Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 6243 

21The text of the proposed rule change is 

available on the Commission’s Web site at http:// 

www.sec.gov. 

22 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

respect to, and facilitating transactions 

in securities, to remove impediments to 

and perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. The 

proposed rule change is designed to 

facilitate companies’ compliance with 

Nasdaq rules by aligning Nasdaq’s 

disclosure requirements with those of 

the Commission. Nasdaq notes that the 

proposed changes to permit disclosure 

by a Form 8–K will not eliminate or 

reduce information now available to 

investors, but will minimize duplicative 

disclosures. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

Nasdaq does not believe that the 

proposed rule change will result in any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 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 

90 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 such 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–NASDAQ-2010–006 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 No. 

SR–NASDAQ–2010–006. 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,21 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 

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 Nasdaq. 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–NASDAQ–2010–006 and should be 

submitted on or before March 1, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2633 Filed 2–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61466; File No. SR–CBOE– 

2010–005] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing of 

Proposed Rule Change, and 

Amendment No. 1 Thereto, To 

Establish Strike Price Intervals and 

Trading Hours for Options on IndexLinked Securities 

February 2, 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 January 27, 2010, Chicago Board 

Options Exchange, Incorporated 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. On February 

2, 2010, CBOE filed Amendment No. 1 

to the proposed rule change. 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 

Prior to the commencement of trading 

options on Index-Linked Securities, 

CBOE proposes to establish strike price 

intervals and trading hours for these 

new products. The text of the proposed 

rule change is available on CBOE’s Web 

site at (http://www.cboe.org/legal), on 

the Commission’s Web site at http:// 

www.sec.gov, at CBOE, and at the 

Commission’s Public Reference Room. 

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 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. 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

6244 Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 

3See e.g., Securities Exchange Act Release Nos. 

58204 (July 22, 2008), 73 FR 43807 (July 28, 2008) 

(approving SR–CBOE–2008–64); 58203 (July 22, 

2008), 73 FR 43812 (July 28, 2008) (approving SR– 

NYSEArca–2008–57); 58985 (November 10, 2008), 

73 FR 72538 (November 28, 2008) (approving SR– 

ISE–2008–86). 

4OCC previously received Commission approval 

to clear options based on Index-Linked Securities. 

See Securities Exchange Act Release No. 60872 

(October 23, 2009), 74 FR 55878 (October 29, 2009) 

(SR–OCC–2009–14). 

5See Interpretation and Policy .08 to Rule 5.5. 

See also Securities Exchange Act Release No. 46507 

(September 17, 2007), 67 FR 60266 (September 25, 

2002) (permitting list of options on ETFs at $1 strike 

price intervals) (SR–CBOE–2002–54). 

6See Amendment No. 1. 7See supra note 5. 8See Amendment No. 1. 9See Id. 

10 15 U.S.C. 78f(b). 11 15 U.S.C. 78f(b)(5). 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Prior to the commencement of trading 

options on Index-Linked Securities (also 

known as exchange-traded notes 

(‘‘ETN’’)), the Exchange is proposing to 

establish strike price intervals and 

trading hours for these new products. 

The Commission has approved 

CBOE’s and other option exchanges’ 

proposals to enable the listing and 

trading of options on Index-Linked 

Securities.3 Options trading has not 

commenced to date and is contingent 

upon the Commission’s approval of The 

Options Clearing Corporation’s (‘‘OCC’’) 

proposed supplement to the Options 

Disclosure Document (‘‘ODD’’) that will 

provide disclosure regarding options on 

Index-Linked Securities.4

$1 Strikes for ETN Options 

Prior to the commencement of trading 

options on Index-Linked Securities, the 

Exchange is proposing to establish that 

strike price intervals of $1 will be 

permitted where the strike price is less 

than $200. Where the strike price is 

greater than $200, $5 strikes will be 

permitted. These proposed changes are 

reflected by the proposed addition of 

new Interpretation and Policy .09 to 

Rule 5.5. 

Without discounting the differences 

between exchange-traded funds (‘‘ETFs’’) 

and Index-Linked Securities, the 

Exchange seeks to extend the trading 

conventions applicable to options on 

ETFs to options on Index-Linked 

Securities. CBOE contends that the 

proposed strike price intervals for 

options on Index-Linked Securities are 

consistent with the strike price intervals 

currently permitted for options on 

ETFs.5 The Exchange believes that $1 

strike price intervals for options on 

Index-Linked Securities will provide 

investors with greater flexibility by 

allowed [sic] them to establish positions 

that are better tailored to meet their 

investment objectives. 

The Exchange states that it is seeking 

to establish $1 strikes for ETN options 

(where the strike price is less than $200) 

because CBOE believes the marketplace 

and investors will be expecting ETN 

options to trade in a similar manner to 

options on exchange-traded funds 

(‘‘ETFs’’).6 Strike prices for ETF options 

are permitted in $1 or greater intervals 

where the strike price is $200 or less 

and $5 or greater where the strike price 

is greater than $200.7 Accordingly, the 

Exchange believes that the rationale for 

permitting $1 strikes for ETF options 

equally applies to permitting $1 strikes 

for ETN options and the Exchange 

believes that investors will be better 

served if $1 strike price intervals are 

available for ETN options (where the 

strike price is less than $200).8

CBOE has analyzed its capacity and 

represents that it believes the Exchange 

and the Options Price Reporting 

Authority have the necessary systems 

capacity to handle the additional traffic 

associated with the listing and trading 

of $1 strikes (where the strike price is 

less than $200) for ETN options.9

Trading Hours for ETN Options 

Similar to the trading hours for ETF 

options, the Exchange proposes to 

amend Interpretation and Policy .03 to 

Rule 6.1 by adding new subparagraph 

(b) to provide that options on IndexLinked Securities, as defined under 

Interpretation and Policy .13 to Rule 5.3, 

may be traded on the Exchange until 

3:15 p.m. each business day. The 

Exchange is also proposing to make a 

technical change to Interpretation and 

Policy .03 to Rule 6.1. 

It is expected that other options 

exchanges that have adopted rules 

providing for the listing and trade of 

options on Index-Linked Securities will 

submit similar proposals. 

2. Statutory Basis 

Because the Exchange believes that 

the current rule proposal will lessen 

investor confusion by having strike 

price intervals and trading hours 

established prior to the commencement 

of trading in options on Index-Linked 

Securities, the Exchange believes the 

rule proposal is consistent with the Act 

and the rules and regulations under the 

Act applicable to a national securities 

exchange and, in particular, the 

requirements of Section 6(b) of the 

Act.10 Specifically, the Exchange 

believes that the proposed rule change 

is consistent with the Section 6(b)(5) 

Act 11 requirements that the rules of an 

exchange be designed to promote just 

and equitable principles of trade, to 

prevent fraudulent and manipulative 

acts and, in general, to 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 not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

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 

Within 35 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 

90 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 Comment 

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–CBOE–2010–005 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. 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 6245 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Securities Exchange Act Release No. 34–61460 

(February 1, 2010) (SR–NASDAQ–2010–018). 

4 15 U.S.C. 78f. 

5 15 U.S.C. 78f(b)(4). 

All submissions should refer to File 

Number SR–CBOE–2010–005. 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, 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 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 

Number SR–CBOE–2010–005 and 

should be submitted on or before 

February 23, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2632 Filed 2–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61467; File No. SR– 

NASDAQ–2010–020] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Modify Fees 

for Members Using the NASDAQ 

Market Center 

February 2, 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 February 

1, 2010, The NASDAQ Stock Market 

LLC (‘‘NASDAQ’’ or the ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the Exchange. 

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 

NASDAQ proposes to modify pricing 

for NASDAQ members using the 

NASDAQ Market Center. NASDAQ will 

implement the proposed change on 

February 1, 2010. The text of the 

proposed rule change is available at 

http://nasdaqomx.cchwallstreet.com/, at 

NASDAQ’s principal office, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

NASDAQ 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. 

NASDAQ 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 

NASDAQ is introducing pricing for its 

SAVE routing strategy, which was 

recently filed on an immediately 

effective basis in SR–NASDAQ–2010– 

018.3 In the SAVE strategy, at the option 

of the entering party, orders either route 

to NASDAQ OMX BX (‘‘BX’’), check the 

NASDAQ book, and then route to other 

destinations on the routing table for 

SAVE, or check the NASDAQ book first 

and then route to routing table 

destinations, which may include BX. 

For orders pursuing this routing 

approach, NASDAQ will pass through 

all fees assessed and rebates offered by 

BX, charge $0.0010 per share executed 

for orders that execute at the New York 

Stock Exchange (‘‘NYSE’’), and charge 

$0.0026 per share executed for orders 

that execute in other away venues. 

Orders that execute in the NASDAQ 

Market Center will be charged the 

normal NASDAQ execution charges. 

NASDAQ is also amending its fee 

schedule to reflect recent modifications 

to Rule 4758, which governs order 

routing. NASDAQ amended that rule to 

describe various routing options with 

greater specificity than had previously 

been provided by the rule. Whereas the 

NASDAQ fee schedule contained in 

Rule 7018 had previously contained 

descriptive references to the routing 

parameters of particular routing options, 

the schedule is now being amended to 

refer to specific order routing options by 

the same name used in Rule 4758, such 

as SCAN, DOT, or TFTY. NASDAQ 

believes that this change will increase 

the clarity of both its routing rule and 

its fee schedule. The amended fee 

schedule also clarifies that TFTY, 

MOPP, SAVE, and directed orders are 

not counted for purposes of determining 

a member’s shares of liquidity routed 

under provisions that base certain 

discounts on the number of shares of 

liquidity routed, removed and/or 

provided. 

NASDAQ is also removing several 

unnecessary provisions from Rule 7018. 

Specifically, NASDAQ is deleting 

references to (i) orders in NASDAQlisted securities that execute at BX prior 

to routing to NYSE or NYSE Amex, 

since neither venue trades NASDAQlisted securities, and (ii) ‘‘other orders’’ 

that execute at BX without attempting to 

execute at NASDAQ, since all possible 

execution parameters for orders that 

execute at BX without checking the 

NASDAQ book are covered by other fee 

provisions. 

2. Statutory Basis 

NASDAQ believes that the proposed 

rule change is consistent with the 

provisions of Section 6 of the Act,4 in 

general, and with Section 6(b)(4) of the 

Act,5 in particular, in that it provides for 

the equitable allocation of reasonable 

dues, fees and other charges among 

members and issuers and other persons 

using any facility or system which 

NASDAQ operates or controls. 

NASDAQ is introducing fees for the 

new SAVE routing option, under which 

members pay a low fee to route to the 

NYSE and other destinations to 

encourage members to make greater use 

of NASDAQ’s routing services. The 

changes will result in a reduction of fees 

paid by members that make use of 

SAVE, as compared with currently 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES