28086 Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 

5Securities Exchange Act Release No. 61591, 75 

FR 9979 (Mar. 4, 2010). 

6 15 U.S.C. 78q–1. 

7 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(iii). 

4 17 CFR 240.19b–4(f)(3). 

Gold Shares and ETFS Physical Silver 

Shares.5

In its capacity as a ‘‘derivatives 

clearing organization’’ registered as such 

with the CFTC, OCC is filing this 

proposed rule change for prior approval 

by the CFTC pursuant to provisions of 

the Commodity Exchange Act (‘‘CEA’’) 

in order to foreclose any potential 

liability under the CEA based on an 

argument that the clearing by OCC of 

such options as securities options 

constitutes a violation of the CEA. 

OCC states that the proposed 

interpretation of OCC’s By-Laws is 

consistent with the purposes and 

requirements of Section 17A of the Act 6

because it is designed to promote the 

prompt and accurate clearance and 

settlement of transactions in securities 

options, to foster cooperation and 

coordination with persons engaged in 

the clearance and settlement of such 

transactions, to remove impediments to 

and perfect the mechanism of a national 

system for the prompt and accurate 

clearance and settlement of such 

transactions, and, in general, to protect 

investors and the public interest. It does 

so by reducing the likelihood of a 

dispute as to OCC’s treatment of options 

based on the CBOE Gold ETF Volatility 

Index. The proposed rule change is not 

inconsistent with the By-Laws and 

Rules of OCC. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

OCC does not believe that the 

proposed rule change would impose any 

burden on competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

OCC has not solicited or received 

written comments relating to the 

proposed rule change. OCC will notify 

the Commission of any written 

comments it receives. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within thirty-five days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

ninety days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) By order approve the proposed 

rule change, or 

(B) Institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

No. SR–OCC–2010–07 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File No. 

SR–OCC–2010–07. This file number 

should be included on the subject line 

if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of such filing 

also will be available for inspection and 

copying at OCC’s principal office and on 

OCC’s Web site at http:// 

www.theocc.com/publications/rules/ 

proposed_changes/ 

proposed_changes.jspU. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submission 

should refer to File No. SR–OCC–2010– 

07 and should be submitted on or before 

June 9, 2010. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.7

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2010–11940 Filed 5–18–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62095; File No. SR–CBOE– 

2010–042] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to Suspension 

of Seat Market 

May 13, 2010. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on May 6, 2010, the Chicago Board 

Options Exchange, Incorporated 

(‘‘CBOE’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’ or ‘‘SEC’’) the proposed 

rule change as described in Items I, II 

and III below, which Items have been 

prepared by the CBOE. CBOE has filed 

the proposal pursuant to Section 

19(b)(3)(A)(iii) of the Act 3 and Rule 

19b–4(f)(3) thereunder,4 which renders 

the proposal effective upon filing with 

the Commission. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested parties. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

CBOE proposes to amend its rules 

governing the sale and transfer of 

Exchange memberships by adding new 

Interpretation and Policy .02 to Rule 

3.14. The rule proposal is available on 

the Exchange’s Web site (http:// 

www.cboe.org/legal), at the Exchange’s 

Office of the Secretary, at the 

Commission’s Public Reference Room, 

and on the Commission’s Web site at 

http://www.sec.gov. 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 28087 

5 17 CFR 242.104. 

6 17 CFR 242.104. 

7 15 U.S.C. 78f(b). 

8 15 U.S.C. 78f(b)(5). 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

CBOE included statements concerning 

the purpose of and basis for the 

proposed rule change and discussed any 

comments it received on the proposed 

rule change. The text of those 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in Sections A, B, and C below, of 

the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to provide for a fair and 

orderly market in shares of common 

stock of CBOE Holdings, Inc. (‘‘CBOE 

Holdings Common Stock’’) in the unique 

circumstances presented during the 

brief period, anticipated to be three 

business days, between the 

commencement of the initial public 

offering of such shares and the 

effectiveness of the demutualization of 

the Exchange. The timetable for the 

demutualization of the Exchange and 

the public offering of CBOE Holdings 

Common Stock is such that, although 

the demutualization transaction will 

have been approved in a vote of the 

Exchange membership prior to the 

commencement of the public offering, 

the demutualization will not become 

effective until just prior to the closing of 

the public offering, which is expected to 

occur three business days after the 

commencement of the offering. This 

timetable avoids having to address 

difficult administrative issues that 

would otherwise arise on account of the 

need to issue special ‘‘Class A’’ and 

‘‘Class B’’ shares of CBOE Holdings 

Common Stock to Exchange 

membership owners and to participants 

in the settlement of the ‘‘Exercise Right’’ 

litigation, respectively, upon the 

effectiveness of the demutualization. 

Upon the closing of the public offering, 

both of these special share Classes will 

be converted into the same classes of 

shares of CBOE Holding Common Stock. 

By essentially eliminating the time 

interval between the effectiveness of the 

demutualization and the closing of the 

public offering, the Exchange is able to 

avoid difficult issues that would 

otherwise have to be addressed as a 

result of having both Class A and Class 

B shares of CBOE Holdings Common 

Stock outstanding prior to just before 

the closing of the public offering. 

As is customary in underwritten 

public offerings, immediately upon the 

commencement of the public offering of 

shares of CBOE Holdings common stock 

the shares will begin to be traded on a 

when-issued basis on the exchange 

where the shares are listed. However, 

because the effectiveness of the 

demutualization will not occur until 

just before the closing of the public 

offering for the reason explained above, 

Exchange memberships will continue to 

be outstanding concurrently with the 

when-issued trading of the same class of 

shares into which they will ultimately 

be converted. It is essential to the 

orderliness of the public offering of 

shares of CBOE Holdings Common 

Stock and consistent with the ability of 

the underwriters to engage in 

stabilization transactions in those shares 

under Rule 104 of Regulation M under 

the Securities Exchange Act of 1934,5

that while there is when-issued trading 

in shares of CBOE Holdings Common 

Stock in the listed market for these 

shares, there must not be an alternative 

market in the same class of shares or in 

interests that are equivalent to those 

shares. If there were to continue to be 

a market for Exchange memberships 

during this brief period, it would 

amount to an alternative market for the 

class of shares being offered, since upon 

the effectiveness of the demutualization 

all outstanding Exchange memberships 

will be converted into shares of CBOE 

Holdings Common Stock. The Exchange 

believes that such a seat market would 

be outside of the scope of Regulation 

M 6 and the underwriters’ ability to 

stabilize the price of the shares being 

offered. Accordingly, the existence of 

such an alternative market would 

jeopardize the orderliness of the public 

offering. For this reason, the Exchange 

believes that it is necessary to suspend 

the operation of the Exchange’s seat 

market during this brief period. A rule 

change is needed to accomplish this 

suspension, since it is for a longer 

period than the Board of Directors is 

authorized to declare under existing 

Interpretation and Policy .01 under 

Exchange Rule 3.14. 

There should be no adverse 

consequences to Exchange members as 

a result of suspending the CBOE seat 

market for a brief, three-day period. 

Before the public offering commences, 

and as a condition of the offering, the 

demutualization of the Exchange will 

have been approved by a vote of the 

Exchange membership, although as 

explained above the demutualization 

will not become effective until after the 

public offering has been completed and 

just prior to its closing. During this 

period, the ownership interests in the 

Exchange will, for all practical 

purposes, be represented by the shares 

of CBOE Holdings common stock into 

which memberships will be converted 

in accordance with the terms and upon 

the effectiveness of the demutualization, 

which will have been approved by 

CBOE’s membership. Once this 

happens, Exchange memberships will 

cease to exist and the purchase and sale 

of Exchange memberships will no 

longer be possible. Thus the effect of the 

proposed rule change is simply to 

accelerate the termination of the seat 

market by three days prior to the time 

it would have ended in any event. 

In the unlikely event that the 

demutualization, having been approved 

by the membership, does not become 

effective as anticipated, the public 

offering will not close and Exchange 

memberships will remain outstanding. 

In that event, the seat market will once 

again resume operation, subject only to 

the authority of the Board to delay its 

resumption for no more than one 

business day under existing 

Interpretation and Policy .01 of Rule 

3.14, if the Board determines that under 

the circumstances such a delay is 

needed in the interest of a fair and 

orderly market in memberships. 

2. Statutory Basis 

By providing for a fair and orderly 

public offering of shares of CBOE 

Holdings Common Stock and 

eliminating any possibility that the 

market in Exchange memberships could 

be used to manipulate the when-issued 

market in such shares, the proposed rule 

change is consistent with Section 6(b) of 

the Act 7 in general, and furthers the 

objectives of Section 6(b)(5) 8 in 

particular, in that it would prevent 

fraudulent and manipulative acts and 

practices, would promote just and 

equitable principles of trade and would 

protect investors and the public interest. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE does not believe that the 

proposed rule change will impose any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 


jlentini on DSKJ8SOYB1PROD with NOTICES
28088 Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 

9 15 U.S.C. 78s(b)(3)(A)(iii). 

10 17 CFR 240.19b–4(f)(3). 

11 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A). 

4 17 CFR 240.19b–4(f)(6). 

5The Commission notes that the text of the 

proposed rule change is attached as Exhibit 5 to the 

Form 19b–4, but is not attached to this Notice. 

6The term ‘‘BOXR’’ or ‘‘BOX Regulation’’ means 

Boston Options Exchange Regulation LLC, a 

wholly-owned subsidiary of the Exchange. See 

Chapter I, Section 1(a)(9) of the BOX Rules. 

7The term ‘‘Market Maker’’ means an Options 

Participant registered with the Exchange for the 

purpose of making markets in options contracts 

traded on the Exchange and that is vested with the 

rights and responsibilities specified in Chapter VI 

of the BOX Rules. All Market Makers are designated 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received from 

Members, Participants or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 9 and 

subparagraph (f)(3) of Rule 19b–4 

thereunder.10 At any time within 60 

days of the filing of the proposed rule 

change, the Commission may summarily 

abrogate such rule change if it appears 

to the Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–CBOE–2010–042 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–CBOE–2010–042. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of such filing 

also will be available for inspection and 

copying at the principal office of the 

CBOE. All comments received will be 

posted without change; the Commission 

does not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–CBOE–2010–042 and 

should be submitted on or before June 

9, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2010–11944 Filed 5–18–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62103; File No. SR–BX– 

2010–036] 

Self-Regulatory Organizations; 

NASDAQ OMX BX, Inc.; Notice of Filing 

and Immediate Effectiveness of 

Proposed Rule Change To Reduce the 

Required Number of Market Makers 

Appointed in a Particular Class for the 

Opening of Trading 

May 13, 2010. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on May 4, 

2010, NASDAQ OMX BX, Inc. (the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the self-regulatory organization. The 

Exchange filed the proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act,3 and Rule 19b–4(f)(6) thereunder,4

which renders the proposal effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

NASDAQ OMX BX, Inc. (the 

‘‘Exchange’’) proposes to amend Chapter 

IV, Section 5 (Minimum Participation 

Requirement for Opening Trading of 

Option Classes) of the Rules of the 

Boston Options Exchange Group, LLC 

(‘‘BOX’’) to reduce the required number 

of Market Makers appointed in a 

particular class for the opening of 

trading in series of an options class from 

at least two (2) Market Makers to at least 

one (1) Market Maker. The text of the 

proposed rule change is attached as 

Exhibit 5.5 The text of the proposed rule 

change is available from the principal 

office of the Exchange, at the 

Commission’s Public Reference Room 

and also on the Exchange’s Internet Web 

site at http:// 

nasdaqomxbx.cchwallstreet.com/ 

NASDAQOMXBX/Filings/. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in Sections A, B, and C below, 

of the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Chapter IV, Section 5(a) of the BOX 

Rules currently provides, in relevant 

part, that after a particular class of 

options has been approved for listing on 

BOX, BOXR6 will open trading in series 

of options in that class only if there are 

at least two (2) Market Makers 7


jlentini on DSKJ8SOYB1PROD with NOTICES