37266 Federal Register / Vol. 74, No. 143 / Tuesday, July 28, 2009 / Notices 

9 17 CFR 200.30–3(a)(29). 

1 15 U.S.C. 78k–1. 

2 17 CFR 242.608. 

3On July 6, 2001, the Commission approved the 

OLPP, which was originally proposed by the 

American Stock Exchange LLC (k/n/a NYSE Amex), 

CBOE, ISE, OCC, Philadelphia Stock Exchange, Inc. 

(k/n/a Phlx), and Pacific Exchange, Inc. (k/n/a 

NYSE Arca). See Securities Exchange Act Release 

No. 44521, 66 FR 36809 (July 13, 2001). On 

February 5, 2004, the Boston Stock Exchange, Inc. 

(k/n/a BX) was added as a sponsor to the OLPP. See 

Securities Exchange Act Release No. 49199, 69 FR 

7030 (February 12, 2004). On March 21, 2008, 

NASDAQ was added as a sponsor to the OLPP. See 

Securities Exchange Act Release No. 57546 (March 

21, 2008), 73 FR 16393 (March 27, 2008). 4CBOE, ISE, NASDAQ, BX, Phlx, NYSE Amex, 

and OCC have represented that the Penny Pilot 

Program has resulted in an explosion of quote 

traffic. 

5This restriction would not prohibit the listing of 

at least three options series per expiration month 

in an option class. 

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 4–429. 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 

Amendments that are filed with the 

Commission, and all written 

communications relating to the 

Amendments 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 the Amendments also will be 

available for inspection and copying at 

the respective principal office of BX, 

CBOE, ISE, Nasdaq, Phlx, NYSE Amex, 

and NYSE Arca. 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 4–429 and 

should be submitted on or before 

August 18, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–17880 Filed 7–27–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60365; File No. 4–443] 

Joint Industry Plan; Notice of Filing of 

Amendment No. 3 to the Plan for the 

Purpose of Developing and 

Implementing Procedures Designed To 

Facilitate the Listing and Trading of 

Standardized Options 

July 22, 2009. 

I. Introduction 

On June 30, 2009, June 16, 2009, June 

12, 2009, June 22, 2009, June 12, 2009, 

June 18, 2009, June 23, 2009, July 8, 

2009, the Chicago Board Options 

Exchange, Incorporated (‘‘CBOE’’), 

International Securities Exchange, LLC 

(‘‘ISE’’), NASDAQ Stock Market LLC 

(‘‘NASDAQ’’), NASDAQ OMX BX, Inc. 

(‘‘BX’’), NASDAQ OMX PHLX (‘‘Phlx’’), 

NYSE Amex LLC (‘‘NYSE Amex’’), 

NYSE Arca Inc. (‘‘NYSE Arca’’), and 

The Options Clearing Corporation 

(‘‘OCC’’), respectively, filed with the 

Securities and Exchange Commission 

(‘‘Commission’’), pursuant to Section 

11A of the Securities Exchange Act of 

1934 (‘‘Act’’) 1 and Rule 608 

thereunder,2 Amendment No. 3 to the 

Plan for the Purpose of Developing and 

Implementing Procedures Designed to 

Facilitate the Listing and Trading of 

Standardized Options (‘‘Plan’’ or 

‘‘OLPP’’).3 The amendment would apply 

uniform objective standards to the range 

of options series exercise (or strike) 

prices available for trading on the Plan 

Sponsor exchanges. This notice solicits 

comment on Amendment No. 3 from 

interested persons. 

II. Description of the Proposed 

Amendment 

Amendment No. 3 proposes to apply 

uniform objective standards to the range 

of options series exercise (or strike) 

prices available for trading on the Plan 

Sponsor exchanges as a quote mitigation 

strategy.4 According to the Plan 

Sponsors, by agreeing to uniform 

standards, the Plan Sponsor exchanges 

intend to reduce the overall number of 

option series available for trading, 

which will in turn lessen the rate of 

increase in quote traffic. 

Specifically, the proposal applies 

certain ‘‘range limitations’’ to the 

addition of new series strike prices for 

options classes overlying equity 

securities, Exchange Traded Fund 

Shares, or Trust Issued Receipts. As 

proposed, if the price of the underlying 

security is less than or equal to $20, the 

Series Selecting Exchange would not list 

new option series with an exercise price 

more than 100 percent above or below 

the price of the underlying security.5 If 

the price of the underlying security is 

greater than $20, the Series Selecting 

Exchange would not list new option 

series with an exercise price more than 

50 percent above or below the price of 

the underlying security. 

The proposal provides for an objective 

basis upon which the underlying prices 

for the price range limitations described 

above shall be determined, specifically, 

in regards to intra-day add-on series and 

next-day series additions, new 

expiration months and for option series 

to be added as a result of pre-market 

trading. Furthermore, 8 a.m. Chicago 

time is proposed as the earliest 

permissible time at which a Series 

Selecting Exchange may notify the OCC, 

and each other exchange also trading 

the same options class, that it has 

commenced trading new series as a 

result of pre-market trading. This 

earliest permissible time is established 

to ensure that outlier prices for the 

underlying security which occur at 6 

a.m. Chicago time, for example (i.e., 

well in advance of the opening of the 

standard trading session), are not relied 

upon for purposes of the exercise price 

range limitations. 

Example: XYZ closes on Tuesday at $20, 

but trades in the evening aftermarket trading 

session from a range of $35–$40 on 

speculation of a merger. At 8:15 a.m. Chicago 

time the next day (Wednesday), the 

exchanges wish to list additional series, for 

trading that day, with strike prices that 

reflect the anticipated price increase in XYZ 

relative to the previous trading day. There is 

no official high/low price since the market 

has not yet opened for trading for 

Wednesday, so the exchanges use the most 

recent pre-open trade price of $40. The 

exchanges could therefore add series with 

strike prices from $20–$60 based upon the 

proposed exercise price range limitations. 

As of 2 p.m. Chicago time during the 

Wednesday standard trading session XYZ has 

traded from a range of a low price of $40 to 

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Federal Register / Vol. 74, No. 143 / Tuesday, July 28, 2009 / Notices 37267 

6Application of any of the aforementioned 

exceptions and/or exemptions to the strike price 

range limitations for an underlying security would 

be available to all exchanges listing options on such 

security. 

7This belief could be based upon an expected 

announcement by ABC during the after or 

premarket hours or an impending announcement 

which would directly impact ABC’s industry. 

a high price of $45. An exchange wishes to 

add additional series during the standard 

trading session (‘‘intra-day add-on series’’). 

According to the proposed exercise price 

range limitations the exchanges may list 

series with strike prices between $20 and 

$67.50 (i.e., $40¥(40 × .50) and $45 + (45 × 

.50). Note that the exchanges were already 

able to list series with strike prices as low as 

$20 based upon the pre-open 

determinations). 

As of the 3 p.m. Chicago time close on 

Wednesday XYZ hit a low price of $35 and 

a high price of $50 during Wednesday’s 

standard trading session. The exchanges wish 

to add additional series for trading the 

following day (Thursday) (‘‘next-day series 

additions’’). According to the proposed 

exercise price range limitations, the 

exchanges may list additional series with 

strikes between $17.50–$75 (i.e., $35¥(35 × 

.50) and $50 + (50 × .50)). The exchanges also 

wish to add XYZ series the following 

Monday to replace the series expiring this 

Friday (‘‘new expiration months’’), and 

would use this same range ($17.50–$75) for 

those additional series. 

The proposal also allows each Plan 

Sponsor exchange to designate up to 

five underlying securities to except from 

the aforementioned 50 percent 

restriction and instead apply the 100 

percent restriction. These designations 

would be made on an annual basis and 

cannot be removed during the calendar 

year unless the option class is delisted 

by the designating exchange, in which 

case the designating exchange may 

designate another class to replace the 

delisted class. If a designated class is 

delisted by the designating exchange but 

continues to trade on at least one other 

exchange, any additional series for the 

class which are added from that point 

forward would again be subject to the 

proposed exercise price range 

limitations, unless the class is 

subsequently designated by another 

exchange. The proposal also provides an 

exchange with a procedure to request, if 

conditions warrant, additional case-bycase exceptions even when it has 

already so designated five underlying 

securities. 

In addition, a procedure is created for 

a Series Listing Exchange to request an 

exemption, on a case-by-case basis, from 

the 100 percent range limitation, 

whereby, if unanimously agreed upon 

by all exchanges that list the particular 

options class, the Series Listing 

Exchange may list options series with 

strike prices that are more than 100 

percent above or below the price of the 

underlying security.6

Example: Exchange E has designated ABC 

as one of its five classes for which the 100 

percent exercise price range limitations shall 

apply despite ABC’s price exceeding $20. 

ABC hit a low price of $25 and a high price 

of $30 during the standard trading session as 

of the 3 p.m. Chicago time market close on 

Wednesday. The exchanges are considering 

next-day series additions for Thursday’s 

opening, and, according to the proposed 

exercise price range limitations, may list 

additional series with strikes ranging from 

$0–$60. However, Exchange E believes that 

$60 as the high strike available to add will 

be insufficient to allow for adequate 

customer demand should ABC’s price 

fluctuate to the high side.7 Exchange E 

requests an exemption from the 100% range 

limitation for the purpose of adding strikes 

beyond $60 beginning on Thursday. If all 

exchanges that trade ABC unanimously 

consent then Exchange E, and all other 

exchanges that list ABC, may exceed the $60 

upper strike price limitation when adding 

new series. If unanimous consent is not given 

then all exchanges will be limited to the 100 

percent exercise price range limitations. The 

exchanges may add strikes beyond $60 to all 

existing series months at the time of consent. 

They may also add strikes beyond $60 in the 

series month that will be created at the next 

standard expiration after consent is provided, 

and if appropriate, any non-standard 

expiration that occurs prior to the standard 

expiration. 

The proposal would not allow for the 

listing of options series that would 

otherwise be prohibited by the rules of 

a Series Selecting Exchange or the Plan, 

nor does it restrict the ability of an 

exchange to list options series that have 

been properly listed by another 

exchange. The proposal also expressly 

eliminates the applicability of the strike 

price range limitations with regard to: 

(1) The listing of $1 strike prices in 

option classes participating in the $1 

Strike Program, where instead, the 

Series Selecting Exchange shall be 

permitted to list $1 strike prices to the 

fullest extent as permitted under its 

rules for the $1 Strike Program; and (2) 

the listing of series of Flexible Exchange 

Options. 

The Commission directed the thencurrent options exchanges to act jointly 

to develop strategies to address overall 

capacity concerns in an Order dated 

September 8, 1999, as confirmed in a 

letter from the Director of the Division 

of Market Regulation dated September 

13, 2000. According to the Plan 

Sponsors, this amendment is an 

additional strategy to meet this goal. 

According to one study cited by the 

Plan Sponsor exchanges, the options 

industry would expect an approximate 

four percent reduction in the number of 

series traded, with only a nominal 

reduction in trading volume, upon 

implementation of the changes 

proposed in this amendment. 

III. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether proposed 

Amendment No. 3 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 4–443 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 4–443. 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 

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 the filing will also be available 

for inspection and copying at principal 

offices of the exchanges. 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 4–443 and 

should be submitted on or before 

August 18, 2009. 

mstockstill on DSKH9S0YB1PROD with NOTICES

37268 Federal Register / Vol. 74, No. 143 / Tuesday, July 28, 2009 / Notices 

8 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. 60085 

(June 10, 2009), 74 FR 28741 (June 17, 2009). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–17883 Filed 7–27–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting 

Notice is hereby given, pursuant to 

the provisions of the Government in the 

Sunshine Act, Public Law 94–409, that 

the Securities and Exchange 

Commission will hold a Closed Meeting 

on Tuesday, July 28, 2009 at 3 p.m. 

Commissioners, Counsel to the 

Commissioners, the Secretary to the 

Commission, and recording secretaries 

will attend the Closed Meeting. Certain 

staff members who have an interest in 

the matters also may be present. 

The General Counsel of the 

Commission, or his designee, has 

certified that, in his opinion, one or 

more of the exemptions set forth in 5 

U.S.C. 552b(c)(10) and 17 CFR 

200.402(a)(10), permit consideration of 

the scheduled matters at the Closed 

Meeting. 

Commissioner Walter, as duty officer, 

voted to consider the items listed for the 

Closed Meeting in a closed session, and 

determined that no earlier notice thereof 

was possible. 

The subject matter of the Closed 

Meeting scheduled for Tuesday, July 28, 

2009 will be: 

A litigation matter; and 

Consideration of amicus participation. 

At times, changes in Commission 

priorities require alterations in the 

scheduling of meeting items. 

For further information and to 

ascertain what, if any, matters have been 

added, deleted or postponed, please 

contact: 

The Office of the Secretary at (202) 

551–5400. 

Dated: July 24, 2009. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. E9–18070 Filed 7–24–09; 4:15 pm] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting 

Notice is hereby given, pursuant to 

the provisions of the Government in the 

Sunshine Act, Public Law 94–409, that 

the Securities and Exchange 

Commission Investor Advisory 

Committee will hold an Open Meeting 

on Monday, July 27, 2009, in the 

Auditorium, Room L–002. The meeting 

will begin at 10 a.m. and will be open 

to the public, with seating on a firstcome, first-served basis. Doors will open 

at 9:30 a.m. Visitors will be subject to 

security checks. 

On July 8, 2009, the Commission 

published notice of the Committee 

meeting (Release No. 33–9049), 

indicating that the meeting is open to 

the public and inviting the public to 

submit written comments to the 

Committee. This Sunshine Act notice is 

being issued because a majority of the 

Commission plans to attend the 

meeting. Commissioner Walter, as duty 

officer, determined that no earlier 

Sunshine Act notice was possible. 

The agenda for the meeting includes 

opening remarks, introduction of 

Committee members, discussion of 

Committee agenda and organization, 

and discussion of investor views of 

possible refinements to the disclosure 

regime. 

For further information, please 

contact the Office of the Secretary at 

(202) 551–5400. 

Dated: July 22, 2009. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. E9–17861 Filed 7–27–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting 

Notice is hereby given, pursuant to 

the provisions of the Government in the 

Sunshine Act, Public Law 94–409, that 

the Securities and Exchange 

Commission will hold a Closed Meeting 

on Thursday, July 30, 2009 at 2 p.m. 

Commissioners, Counsel to the 

Commissioners, the Secretary to the 

Commission, and recording secretaries 

will attend the Closed Meeting. Certain 

staff members who have an interest in 

the matters also may be present. 

The General Counsel of the 

Commission, or his designee, has 

certified that, in his opinion, one or 

more of the exemptions set forth in 5 

U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) 

and 17 CFR 200.402(a)(3), (5), (7), 9(ii) 

and (10), permit consideration of the 

scheduled matters at the Closed 

Meeting. 

Commissioner Walter, as duty officer, 

voted to consider the items listed for the 

Closed Meeting in a closed session. 

The subject matter of the Closed 

Meeting scheduled for Thursday, July 

30, 2009 will be: 

Institution and settlement of injunctive 

actions; 

Institution and settlement of 

administrative proceedings; 

Other matters relating to enforcement 

proceedings; and an adjudicatory 

matter. 

At times, changes in Commission 

priorities require alterations in the 

scheduling of meeting items. 

For further information and to 

ascertain what, if any, matters have been 

added, deleted or postponed, please 

contact: 

The Office of the Secretary at (202) 

551–5400. 

Dated: July 22, 2009. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. E9–17860 Filed 7–27–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60366; File No. SR–FINRA– 

2009–030] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Order Approving a 

Proposed Rule Change To Amend 

Rules 6440 and 6540 To Require 

Members To Create a 

Contemporaneous Record of Certain 

Customer and Order Information 

July 22, 2009. 

On May 22, 2009, the Financial 

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’ 

or ‘‘SEC’’), pursuant to Section 19(b)(1) 

of the Securities Exchange Act of 1934 

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

thereunder,2 a proposed rule change to 

amend Rules 6440 and 6540 to require 

members to create a contemporaneous 

record of certain customer and order 

information. The proposed rule change 

was published for comment in the 

Federal Register on June 17, 2009.3 The 

Commission received no comments on 

the proposal. This order approves the 

proposed rule change. 

I. Description of the Proposed Rule 

Change 

FINRA has proposed to amend Rules 

6440 and 6540 to, among other things, 

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