54410 Federal Register / Vol. 75, No. 172 / Tuesday, September 7, 2010 / Notices 

8 17 CFR 200.30–3(a)(12). 

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

2The Commission has modified the text of the 

summaries prepared by OCC. 

3The standard method for adjusting futures 

contracts in response to cash distributions is to 

decrease the prior day’s settlement price by the 

amount of the dividend. This adjustment is 

effective at the opening of business on the exdistribution date and parallels the adjustment made 

to the price of the underlying stock by the securities 

exchanges on the ex-distribution date. It is intended 

to ensure that no futures mark-to-the-market 

attributable to the adjustment made to the stock 

price for the dividend will occur. 

4OCC also proposes to add Interpretation and 

Policy .10 to Article XII, Section 3 that provides 

that officially reported settlement prices will not be 

adjusted (other than as provided for in the By-Laws 

and Rules) except in extraordinary circumstances. 

The Interpretation further provides that in no event 

will a completed settlement be adjusted due to 

errors discovered thereafter. This latter provision is 

intended to preserve the finality of money 

settlements should it be later determined that an 

officially reported settlement price was erroneous 

and is based on existing provisions of OCC’s ByLaws. See, e.g., Article XIV, Section 6, 

Interpretation and Policy .01; Article XVI, Section 

4, Interpretation and Policy .01; and Article XVII, 

Section 4, Interpretation and Policy .01. 

5Amendment No. 1, which will be executed after 

the effectiveness of this filing, would amend and 

restate Section 5 of the Clearing Agreement. 

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 

will also be available for inspection and 

copying at the principal office of the 

Exchange. 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 No. SR–CBOE– 

2010–076 and should be submitted on 

or before September 28, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–22207 Filed 9–3–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62801; File No. SR–OCC– 

2010–13] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing of a Proposed Rule Change 

To Allow for Adjustments to the 

Settlement Price of ExchangeDesignated Security Futures for All 

Cash Dividends or Distributions Paid 

by the Issuer of the Underlying 

Security 

August 31, 2010. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),1 notice is hereby given that on 

August 19, 2010, The Options Clearing 

Corporation (‘‘OCC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) and on August 25, 2010, 

amended the proposed rule change as 

described in Items I and II below, which 

items have been prepared primarily by 

OCC. The Commission is publishing 

this notice to solicit comments from 

interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The purpose of the proposed rule 

change is to revise OCC’s By-Laws to 

allow OCC to make adjustments to the 

settlement price of exchange-designated 

security futures for all cash dividends or 

distributions paid by the issuer of the 

underlying security. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

OCC 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. OCC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of such statements.2

(A) Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

The primary purpose of this proposed 

rule change is to revise OCC’s By-Laws 

to allow OCC to make adjustments to 

the settlement price of exchangedesignated security futures for all cash 

dividends or distributions paid by the 

issuer of the underlying security. Under 

its current rules, OCC makes such 

adjustments only for ‘‘non-ordinary’’ 

dividends. However, OneChicago, LLC 

(‘‘OneChicago’’) has informed OCC that 

it believes there is a demand for security 

futures that would be adjusted in 

response to all cash dividends or 

distributions. Accordingly, OCC is 

proposing to amend Section 3 of Article 

XII of its By-Laws to permit exchanges 

to designate certain security futures that 

would be adjusted for ordinary as well 

as ‘‘non-ordinary’’ dividends. Exchanges 

could continue to trade security futures 

that would be adjusted only in the event 

of a ‘‘non-ordinary’’ dividend. 

For security futures subject to 

adjustment for all cash dividends or 

distributions, it would be the exchange’s 

responsibility to inform OCC of the 

issuance of a cash dividend or 

distribution and the appropriate 

adjustment amount. Provided that such 

information (including any corrections 

thereto) is reported to OCC before a 

designated cut-off time prior to the exdate, OCC would then make the 

appropriate adjustment to the settlement 

price of the security futures contract. 

Such adjustments would be effective 

before the opening of business on the 

ex-date.3 If the exchange failed to report 

dividend or distribution information to 

OCC on a timely basis or reported 

incorrect dividend or distribution 

information to OCC, then the exchange 

would be able to report such 

information or corrected information to 

OCC on the ex-date, and OCC would 

effect the adjustment as soon as 

practicable thereafter.4 In the event the 

exchange already opened trading in the 

security futures contracts affected 

thereby, the exchange would provide 

OCC with direction on whether such 

trades should be cleared or disregarded 

as provided for in Article VI, Section 7 

of OCC’s By-Laws. Pursuant thereto, 

disregarded transactions would be 

deemed null and void and given no 

effect. These procedures are intended to 

preserve OCC’s ability to initiate and 

conduct nightly processing on a timely 

basis, but they also provide the 

exchange with the opportunity to report 

to OCC dividend or distribution 

information that was not available to it 

before OCC’s processing cut-offs or to 

correct erroneously reported 

information to ensure an appropriate 

adjustment to the settlement price for 

the affected contracts. 

In connection with OneChicago’s 

proposal, OneChicago and OCC also 

have agreed to amend the Security 

Futures Agreement for Clearing and 

Settlement Services, dated April 1, 2002 

(the ‘‘Clearing Agreement’’), by entering 

into Amendment No. 1 thereto.5

Amendment No. 1 would amend 

Section 5 of the Clearing Agreement to 

permit OneChicago to designate those 

security futures contracts for which 

adjustments will be made in response to 

all cash dividends or distributions and 

to set forth for OneChicago’s obligation 

to furnish OCC with notice of all 

relevant information regarding such 

dividends or distributions in order for 


wwoods2 on DSK1DXX6B1PROD with NOTICES_PART 1
Federal Register / Vol. 75, No. 172 / Tuesday, September 7, 2010 / Notices 54411 

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. 

OCC to adjust the settlement price of the 

affected security future as described 

above. Amended Section 5 further 

extends the current indemnification 

provided by OneChicago to OCC to also 

cover losses resulting from adjusting 

security futures in accordance with 

dividend or distribution information 

supplied by OneChicago or failing to 

adjust in the event OneChicago did not 

supply OCC with information regarding 

such an adjustment. 

OCC believes that the proposed rule 

change is consistent with the 

requirements of Section 17A of the Act,6

as amended, and the rules and 

regulations thereunder applicable to 

OCC because it is designed to promote 

the prompt and accurate clearance and 

settlement of security transactions and 

generally to protect investors and the 

public interest by allowing the clearing 

and settling of security futures contracts 

that reflect the issuance of all cash 

dividends or distributions on the 

underlying security. 

(B) Self-Regulatory Organization’s 

Statement on Burden on Competition 

OCC does not believe that the 

proposed rule change will have an 

impact on or impose a burden on 

competition. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments relating to the 

proposed rule change have been 

solicited or received. OCC will notify 

the Commission of any written 

comments received by OCC. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 45 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 or disapprove 

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, as amended, 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–OCC–2010–13 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–OCC–2010–13. 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 inspection and copying in 

the Commission’s Public Reference 

Section, 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 OCC and on 

OCC’s Web site at http:// 

www.theocc.com. 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–OCC– 

2010–13 and should be submitted on or 

before September 28, 2010. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.7

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–22209 Filed 9–3–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62791; File No. SR–NYSE– 

2010–60] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Amending 

NYSE Rule 107B To Revise the 

Quoting Requirements and Add a 

Volume Requirement 

August 30, 2010. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on August 

26, 2010, New York Stock Exchange 

LLC (‘‘NYSE’’ or the ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II, below, which Items have 

been prepared by the self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

NYSE Rule 107B (‘‘Supplemental 

Liquidity Providers’’) (‘‘SLPs’’), which is 

a pilot program, to revise the quoting 

requirements and add a volume 

requirement. The text of the proposed 

rule change is available on the 

Exchange’s Web site at http:// 

www.nyse.com, at the Exchange’s 

principal office, at the Commission’s 

Public Reference Room, and on the 

Commission’s Web site at http:// 

www.sec.gov. 

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 


wwoods2 on DSK1DXX6B1PROD with NOTICES_PART 1