Federal Register / Vol. 79, No. 230 / Monday, December 1, 2014 / Notices 71145 

including the applicant, have 

affiliations with underwriters to Issuers. 

Applicant states that, as a result, when 

an affiliate of the applicant is selected 

to underwrite ABS in an ABS 

Transaction, Rule 3a–7(a)(4)(i)’s 

Independent Trustee Requirement 

generally prevents applicant from 

serving as trustee for the Issuer. 

Applicant states that the Independent 

Trustee Requirement imposes an 

unnecessary regulatory limitation on 

trustee selection and causes market 

distortions by leading to the selection of 

trustees for reasons other than 

customary market considerations of 

pricing and expertise. This result is 

disadvantageous to the ABS market and 

to ABS investors. 

5. Applicant submits that due to the 

nature and timing of the roles of the 

trustee and the underwriter, applicant’s 

affiliation with an underwriter would 

not result in a conflict of interest or 

possibility of overreaching that could 

harm investors. Applicant states that the 

trustee’s role begins with the Issuer’s 

issuance of its securities, and the trustee 

performs its role over the life of the 

Issuer. Applicant states that, in contrast, 

the underwriter is chosen early in the 

ABS Transaction process, may help to 

structure the ABS Transaction, 

distributes the Issuer’s securities to 

investors, and generally has no role 

subsequent to the distribution of the 

Issuer’s securities. Applicant further 

states that an ABS trustee does not 

monitor the distribution of securities or 

any other activity performed by 

underwriters and there is no 

opportunity for a trustee and an 

affiliated underwriter to act in concert 

to benefit themselves at the expense of 

holders of the ABS either prior to or 

after the closing of the ABS Transaction. 

6. Applicant states that the trustee’s 

role is narrowly defined, and that the 

trustee is neither expected nor required 

to exercise discretion or judgment 

except after a default in the ABS 

transaction, which rarely occurs. 

Applicant states that the duties of a 

trustee after a default are limited to 

enforcing the terms of the Agreement for 

the benefit of debt holders as a ‘‘prudent 

person’’ would enforce such interests 

for his own benefit. Applicant further 

states that the trustee of the Issuer has 

virtually no discretion to pursue anyone 

in any regard other than preserving and 

realizing on the assets. In any event, 

Applicant states that any role taken by 

the Trustee in the event of a default 

would occur after the underwriter has 

terminated its role in the transaction. 

7. Applicant submits that the 

concerns underlying the Independent 

Trustee Requirement are not implicated 

if the trustee for an Issuer is 

independent of the sponsor, servicer, 

and credit enhancer for the Issuer, but 

is affiliated with an underwriter for the 

Issuer, because in that situation no 

single entity would act in all capacities 

in the issuance of the ABS and the 

operation of an Issuer. Applicant states 

that applicant would continue to act as 

an independent party safeguarding the 

assets of any Issuer regardless of an 

affiliation with an underwriter of the 

ABS. Applicant submits that the 

concern that affiliation could lead to a 

trustee monitoring the activities of an 

affiliate also is not implicated by a 

trustee’s affiliation with an underwriter, 

because, in practice, a trustee for an 

Issuer does not monitor the distribution 

of securities or any other activity 

performed by underwriters. Applicant 

further states that the requested relief 

would be consistent with the broader 

purpose of Rule 3a–7 of not hampering 

the growth and development of the ABS 

market, to the extent consistent with 

investor protection. 

8. Applicant states that the conditions 

set forth below provide additional 

protections against conflicts and 

overreaching. For example, the 

conditions ensure that the Applicant 

will continue to act as an independent 

party safeguarding the assets of an 

Issuer regardless of an affiliation with 

the underwriter of the ABS and would 

not allow the underwriter any greater 

access to the assets, or cash flows 

derived from the assets, of the Issuer 

than if there were no affiliation. 

Applicant’s Conditions 

The applicant agrees that any order 

granting the requested relief will be 

subject to the following conditions: 

1. The applicant will not be affiliated 

with any person involved in the 

organization or operation of the Issuer 

in an ABS Transaction other than the 

underwriter. 

2. The applicant’s relationship to an 

affiliated underwriter will be disclosed 

in writing to all parties involved in an 

ABS Transaction, including the rating 

agencies and the ABS holders. 

3. An underwriter affiliated with the 

applicant will not be involved in the 

operation of an Issuer, and its 

involvement in the organization of an 

Issuer will extend only to determining 

the assets to be pooled, assisting in 

establishing the terms of the ABS to be 

underwritten, and providing the 

sponsor with a warehouse line of credit 

with which to purchase the pool assets. 

4. An affiliated person of the 

applicant, including an affiliated 

underwriter, will not provide credit or 

credit enhancement to an Issuer if the 

applicant serves as trustee to the Issuer. 

5. An underwriter affiliated with the 

applicant will not engage in any 

remarketing agent activities, including 

involvement in any auction process in 

which ABS interest rates, yields, or 

dividends are reset at designated 

intervals in any ABS Transaction from 

which the applicant serves as trustee to 

the Issuer. 

6. All of an affiliated underwriter’s 

contractual obligations pursuant to the 

underwriting agreement will be 

enforceable by the sponsor. 

7. Consistent with the requirements of 

Rule 3a–7(a)(4)(i), the applicant will 

resign as trustee for the Issuer if 

applicant becomes obligated to enforce 

any of an affiliated underwriter’s 

obligations to the Issuer. 

8. The applicant will not price its 

services as trustee in a manner designed 

to facilitate its affiliate being named 

underwriter. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–28174 Filed 11–28–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. IC–31344] 

Notice of Applications for 

Deregistration Under Section 8(f) of the 

Investment Company Act of 1940 

November 21, 2014. 

The following is a notice of 

applications for deregistration under 

section 8(f) of the Investment Company 

Act of 1940 for the month of November 

2014. A copy of each application may be 

obtained via the Commission’s Web site 

by searching for the file number, or for 

an applicant using the Company name 

box, at http://www.sec.gov/search/

search.htm or by calling (202) 551– 

8090. An order granting each 

application will be issued unless the 

SEC orders a hearing. Interested persons 

may request a hearing on any 

application by writing to the SEC’s 

Secretary at the address below and 

serving the relevant applicant with a 

copy of the request, personally or by 

mail. Hearing requests should be 

received by the SEC by 5:30 p.m. on 

December 19, 2014, and should be 

accompanied by proof of service on 

applicants, in the form of an affidavit or, 

for lawyers, a certificate of service. 

Pursuant to Rule 0–5 under the Act, 


asabaliauskas on DSK5VPTVN1PROD with NOTICES
71146 Federal Register / Vol. 79, No. 230 / Monday, December 1, 2014 / Notices 

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

2 17 CFR 240.19b–4. 

3The Penny Pilot was established in March 2008 

and in October 2009 was expanded and extended 

through December 31, 2014. See Securities 

Exchange Act Release Nos. 57579 (March 28, 2008), 

73 FR 18587 (April 4, 2008) (SR–NASDAQ–2008– 

026) (notice of filing and immediate effectiveness 

establishing Penny Pilot); 60874 (October 23, 2009), 

74 FR 56682 (November 2, 2009) (SR–NASDAQ– 

2009–091) (notice of filing and immediate 

effectiveness expanding and extending Penny 

Pilot); 60965 (November 9, 2009), 74 FR 59292 

(November 17, 2009) (SR–NASDAQ–2009–097) 

(notice of filing and immediate effectiveness adding 

seventy-five classes to Penny Pilot); 61455 

(February 1, 2010), 75 FR 6239 (February 8, 2010) 

(SR–NASDAQ–2010–013) (notice of filing and 

immediate effectiveness adding seventy-five classes 

to Penny Pilot); 62029 (May 4, 2010), 75 FR 25895 

(May 10, 2010) (SR–NASDAQ–2010–053) (notice of 

filing and immediate effectiveness adding seventyfive classes to Penny Pilot); 65969 (December 15, 

2011), 76 FR 79268 (December 21, 2011) (SR– 

NASDAQ–2011–169) (notice of filing and 

immediate effectiveness extension and replacement 

of Penny Pilot); 67325 (June 29, 2012), 77 FR 40127 

(July 6, 2012) (SR–NASDAQ–2012–075) (notice of 

filing and immediate effectiveness and extension 

and replacement of Penny Pilot through December 

31, 2012); 68519 (December 21, 2012), 78 FR 136 

(January 2, 2013) (SR–NASDAQ–2012–143) (notice 

of filing and immediate effectiveness and extension 

and replacement of Penny Pilot through June 30, 

2013); 69787 (June 18, 2013), 78 FR 37858 (June 24, 

2013) (SR–NASDAQ–2013–082) (notice of filing 

and immediate effectiveness and extension and 

replacement of Penny Pilot through December 31, 

2013); 71105 (December 17, 2013), 78 FR 77530 

(December 23, 2013) (SR–NASDAQ–2013–154) 

(notice of filing and immediate effectiveness and 

extension and replacement of Penny Pilot through 

June 30, 2014); and 79 FR 31151 (May 23, 2014), 

79 FR 31151 (May 30, 2014) (SR–NASDAQ–2014– 

056) ((notice of filing and immediate effectiveness 

and extension and replacement of Penny Pilot 

through December 31, 2014). See also NOM Rules, 

Chapter VI, Section 5. 

4The term ‘‘Customer’’ applies to any transaction 

that is identified by a Participant for clearing in the 

Customer range at The Options Clearing 

Corporation (‘‘OCC’’) which is not for the account 

of broker or dealer or for the account of a 

‘‘Professional’’ (as that term is defined in Chapter 

I, Section 1(a)(48)). 

5The term ‘‘Professional’’ means any person or 

entity that (i) is not a broker or dealer in securities, 

and (ii) places more than 390 orders in listed 

options per day on average during a calendar month 

for its own beneficial account(s) pursuant to 

Chapter I, Section 1(a)(48). All Professional orders 

shall be appropriately marked by Participants. 

6The term ‘‘NOM Market Maker’’ means a 

Participant that has registered as a Market Maker on 

NOM pursuant to Chapter VII, Section 2, and must 

also remain in good standing pursuant to Chapter 

VII, Section 4. In order to receive NOM Market 

Maker pricing in all securities, the Participant must 

be registered as a NOM Market Maker in at least one 

security. 

hearing requests should state the nature 

of the writer’s interest, any facts bearing 

upon the desirability of a hearing on the 

matter, the reason for the request, and 

the issues contested. Persons who wish 

to be notified of a hearing may request 

notification by writing to the 

Commission’s Secretary. 

ADDRESSES: The Commission: Brent J. 

Fields, Secretary, U.S. Securities and 

Exchange Commission, 100 F Street NE., 

Washington, DC 20549–1090. 

FOR FURTHER INFORMATION CONTACT: 

Diane L. Titus at (202) 551–6810, SEC, 

Division of Investment Management, 

Chief Counsel’s Office, 100 F Street NE., 

Washington, DC 20549–8010. 

Cushing Funds Trust 

[File No. 811–22428] 

Summary: Applicant seeks an order 

declaring that it has ceased to be an 

investment company. Applicant 

transferred its assets to corresponding 

series of MainStay Funds Trust, and on 

July 7, 2014, made distributions to its 

shareholders based on net asset value. 

Expenses of $822,606 incurred in 

connection with the reorganization were 

paid by Cushing Asset Management, 

L.P., applicant’s investment adviser, and 

New York Life Investment Management 

LLC, the surviving fund’s investment 

adviser. 

Filing Date: The application was filed 

on October 27, 2014. 

Applicant’s Address: 8117 Preston 

Rd., Suite 440, Dallas, TX 75225. 

Lattice Strategies, LLC 

[File No. 811–23001] 

Summary: Applicant seeks an order 

declaring that it has ceased to be an 

investment company. Applicant states 

the filings on Form N–8A and N–1A 

made under applicant’s file number 

were inadvertent and were intended 

instead to be filed under the file number 

of Lattice Strategies Trust. 

Filing Date: The application was filed 

on October 24, 2014. 

Applicant’s Address: One 

Embarcadero Center, 23rd Floor, San 

Francisco, CA 94111. 

Oceanstone Fund 

[File No. 811–21930] 

Summary: Applicant seeks an order 

declaring that it has ceased to be an 

investment company. On August 29, 

2014, applicant made a liquidating 

distribution to its shareholders, based 

on net asset value. Applicant incurred 

no expenses in connection with the 

liquidation. 

Filing Date: The application was filed 

on October 29, 2014. 

Applicant’s Address: PO Box 130982, 

Carlsbad, CA 92013. 

For the Commission, by the Division of 

Investment Management, pursuant to 

delegated authority. 

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–28175 Filed 11–28–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73676; File No. SR– 

NASDAQ–2014–105] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market, LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Rebates in Penny Pilot Options 

November 24, 2014. 

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 November 

10, 2014, The NASDAQ Stock Market 

LLC (‘‘NASDAQ’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’) 

the proposed rule change as described 

in Items I, II, and III below, which Items 

have been prepared by NASDAQ. 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 Chapter 

XV, entitled ‘‘Options Pricing,’’ at 

Section 2 governing pricing for 

NASDAQ members using the NASDAQ 

Options Market (‘‘NOM’’), NASDAQ’s 

facility for executing and routing 

standardized equity and index options. 

Specifically, NOM proposes to amend 

certain Penny Pilot Options 3 rebates 

currently applicable to Customers,4

Professionals 5 and NOM Market 

Makers.6

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://

www.nasdaq.cchwallstreet.com, at the 

principal office of the Exchange, 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 

Exchange 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. 


asabaliauskas on DSK5VPTVN1PROD with NOTICES