Self-Regulatory Organizations; International Securities Exchange, Inc.; Order Approving a Proposed Rule Change and Amendment No. 1 Thereto and Notice of Filing and Order Granting Accelerated Approval to Amendments No. 2 and 3 Thereto To Permit the Listing and Trading of Quarterly Options Series, 39694-39696 [E6-11002]
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<![CDATA[
39694
Federal Register / Vol. 71, No. 134 / Thursday, July 13, 2006 / Notices
submissions should refer to File
Number SR–Amex–2006–27 and should
be submitted on or before August 3,
2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.11
Jill M. Peterson,
Assistant Secretary.
[FR Doc. E6–11031 Filed 7–12–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54107; File No. SR–CHX–
2006–18]
Self-Regulatory Organization; Chicago
Stock Exchange, Inc.; Order Approving
Proposed Rule Change Amending a
Notice Provision Relating to the
Renewal of Trading Permits
and Policy .01 to CHX Article II, Rule
3, to allow a Participant to cancel a
trading permit in 2006 if the Participant
provided notice to CHX at any time
during the 60 days preceding February
9, 2006. According to CHX, CHX Article
II, Rule 3, caused some confusion
among its Participants. The Commission
therefore finds that the proposed rule
change is an appropriate one time relief
to allow CHX Participants to cancel
their trading permits.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,6 that the
proposed rule change (SR–CHX–2006–
18) be, and it hereby is, approved.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.7
Jill M. Peterson,
Assistant Secretary.
[FR Doc. E6–11004 Filed 7–12–06; 8:45 am]
BILLING CODE 8010–01–P
July 6, 2006.
On May 10, 2006, the Chicago Stock
Exchange, Inc. (‘‘CHX’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to amend the 60-day notice
requirement to cancel trading permits
for 2006. The proposed rule change was
published for comment in the Federal
Register on June 1, 2006.3 The
Commission received no comments
regarding the proposal.
The Commission finds that the
proposed rule change is consistent with
the requirements of the Act and the
rules and regulations thereunder
applicable to a national securities
exchange.4 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,5 which requires that
the rules of the an exchange be designed
to promote just and equitable principles
of trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national securities
system, and, in general, to protect
investors and the public interest.
CHX Article II, Rule 3, requires
Participants to provide CHX with 60days notice to cancel a trading permit.
The Exchange proposes in Interpretation
11 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 53859
(May 24, 2006), 71 FR 31241.
4 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
5 15 U.S.C. 78f(b)(5).
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1 15
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17:46 Jul 12, 2006
Jkt 208001
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54113 File No. SR–ISE–
2006–24]
Self-Regulatory Organizations;
International Securities Exchange, Inc.;
Order Approving a Proposed Rule
Change and Amendment No. 1 Thereto
and Notice of Filing and Order
Granting Accelerated Approval to
Amendments No. 2 and 3 Thereto To
Permit the Listing and Trading of
Quarterly Options Series
July 7, 2006.
I. Introduction
On May 2, 2006, the International
Securities Exchange, Inc. (‘‘ISE’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
initiate a one-year pilot program that
would allow the Exchange to list and
trade options series that expire at the
close of business on the last business
day of a calendar quarter (‘‘Quarterly
Options Series’’). The Exchange filed
Amendment No. 1 with the Commission
on May 17, 2006.3 The amended
proposal was published for comment in
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 In Amendment No. 1, a partial amendment, the
Exchange made minor modifications to the
proposed rule text.
PO 00000
6 15
7 17
Frm 00040
Fmt 4703
Sfmt 4703
the Federal Register on June 1, 2006.4
No comments were received regarding
the amended proposal. The Exchange
filed Amendments No. 2 and 3 with the
Commission on July 6, 2006, and July 7,
2006, respectively.5 This notice and
order approves the proposed rule
change and Amendment No. 1 thereto,
solicits comment on Amendments No. 2
and 3, and approves Amendments No.
2 and 3 on an accelerated basis.
II. Description of Proposed Rule
ISE proposes to amend its rules to
establish a pilot program to list and
trade Quarterly Options Series, which
would expire at the close of business on
the last business day of a calendar
quarter (‘‘Pilot Program’’). Under the
proposal, the Exchange could select up
to five approved options classes 6 on
which Quarterly Options Series could
be opened. A series could be opened on
any business day and would expire at
the close of business on the last
business day of a calendar quarter. The
Exchange also could list and trade
Quarterly Options Series on any options
class that is selected by another
exchange that employs a similar pilot
program. For each class selected for the
Pilot Program, the Exchange would list
series that expire at the end of the next
four consecutive calendar quarters, as
well as the fourth quarter of the
following calendar year.
Quarterly Options Series listed on
currently approved options classes
would be P.M. settled and, in all other
respects, would settle in the same
manner as do the monthly expiration
series in the same options class.
The strike price for each series would
be fixed at a price per share, with two
strike prices above and two strike prices
below the value of the underlying
security at about the time that a
Quarterly Options Series is opened for
trading on the Exchange. The interval
between strike prices on Quarterly
Options Series would be the same as the
interval between strike prices for series
in the same options class that expire in
accordance with the normal monthly
expiration cycles. In Amendment No. 3,
4 See Securities Exchange Act Release No. 53857
(May 24, 2006), 71 FR 31246 (‘‘Notice’’).
5 In Amendment No. 2, a partial amendment, the
Exchange modified the provision of the proposed
rule text under which the Exchange may list
additional strike prices for Quarterly Options
Series. In Amendment No. 3, a partial amendment,
the Exchange modified the proposed rule text to
provide that the Exchange may list Quarterly
Options Series with strike prices that are within
$5.00 from the closing price of the underlying
security on the preceding trading day. See
discussion in Part II, infra.
6 Quarterly Options Series may be opened on
indexes or on Exchange Traded Funds that satisfy
the applicable listing criteria under ISE rules.
E:\FR\FM\13JYN1.SGM
13JYN1
Federal Register / Vol. 71, No. 134 / Thursday, July 13, 2006 / Notices
the Exchange proposes rule text
providing that the series listed by the
Exchange under the Pilot Program
would have strike prices that are within
$5.00 from the closing price of the
underlying security on the preceding
trading day.
The proposal would permit the
Exchange to open for trading additional
Quarterly Options Series of the same
class when the Exchange deems it
necessary to maintain an orderly
market, to meet customer demand, or
when the market price of the underlying
security moves substantially from the
initial exercise price or prices. In
Amendment No. 2, the Exchange
proposes rule text that provides that any
additional series opened for trading by
the Exchange would be priced within
$5.00 of the closing price of the
underlying security on the preceding
trading day.
ISE proposes that the Pilot Program
extend one year from the date the
Exchange first initiates trading in a
Quarterly Options Series, which, as per
the proposed rules, would be no later
than July 24, 2006.7
sroberts on PROD1PC70 with NOTICES
III. Discussion
After careful review, the Commission
finds that the proposal, as amended, is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.8 In particular, the
Commission believes that the proposal
is consistent with the requirements of
Section 6(b)(5) of the Act,9 which
requires, among other things, that the
rules of a national securities exchange
be designed to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, to promote just and equitable
principles of trade, and, in general, to
protect investors and the public interest.
The Commission believes that
allowing the Exchange to list and trade
Quarterly Options Series, under the
terms described in the Exchange’s
proposal, should provide investors with
new means of managing their risk
exposures and carrying out their
investment objectives. The Commission
notes that the Pilot Program limits the
series that may be opened pursuant to
the Pilot Program by requiring them to
have strike prices within $5.00 of the
closing price of the underlying security
on the preceding trading day. The
7 See
ISE Proposed Rules 504, Supplementary
Material .03, and 2009, Supplementary Material .02.
8 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
9 15 U.S.C. 78f(b)(5).
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17:46 Jul 12, 2006
Jkt 208001
Commission believes this restriction
should allow the exchange to offer a
wider array of investment opportunities,
while minimizing the impact on
quotation message traffic. The
Commission also notes that the proposal
requires the Exchange to closely
monitor the trading and quotation
volume associated with the additional
options series created under the Pilot
Program and the effect of these
additional series on the capacity of the
Exchange’s, OPRA’s, and vendors’
systems.10
Pursuant to Section 19(b)(2) of the
Act,11 the Commission finds good cause
for approving the amended proposal
prior to the thirtieth day after the
publication of Amendments No. 2 and
3 in the Federal Register. Amendments
No. 2 and 3 modify the proposed rule
text by placing restrictions on the series
the Exchange may open for trading in an
approved class. Any series opened for
trading pursuant to the Pilot Program
would have strike prices within $5.00 of
the closing price of the underlying
security on the preceding trading day.
This restriction is modeled after the
identical provision previously approved
as part of the Exchange’s $1 Strike Pilot
Program, and thus raises no new issues
of regulatory concern.12 The
Commission finds good cause to
accelerate approval of the amended
proposal because it believes this
restriction should help to minimize the
Pilot Program’s impact on quotation
message traffic.
IV. Solicitation of Comments
Concerning Amendments No. 2 and 3
Interested persons are invited to
submit written data, views, and
arguments concerning Amendments No.
2 and 3, including whether it is
consistent with the Act. Comments may
be submitted by any of the following
methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–ISE–2006–24 on the subject
line.
10 If the Exchange were to propose an extension,
expansion, or permanent approval of the Pilot
Program, the Exchange would be required to submit
a report on the Pilot Program to the Commission at
least 60 days prior to the Pilot Program expiration
date. See Notice, supra note 4, at 31248.
11 15 U.S.C. 78s(b)(2).
12 See ISE Rule 504(g).
PO 00000
Frm 00041
Fmt 4703
Sfmt 4703
39695
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–ISE–2006–24. 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 (https://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. 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–ISE–2006–24 and should be
submitted on or before August 3, 2006.
V. Conclusion
For the foregoing reasons, the
Commission finds that the proposed
rule change, as amended, is consistent
with the requirements of the Act and the
rules and regulations thereunder.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,13 that the
proposed rule change (File No. SR–ISE–
2006–24), as amended, is approved, and
that Amendments No. 2 and 3 thereto
are approved on an accelerated basis, as
a pilot program for a one-year period
commencing on the day the Exchange
first initiates trading in a Quarterly
Options Series, which, as per the
proposed rules, would be no later than
July 24, 2006.14
13 Id.
14 See ISE Proposed Rules 504, Supplementary
Material .03, and 2009, Supplementary Material .02.
E:\FR\FM\13JYN1.SGM
13JYN1
39696
Federal Register / Vol. 71, No. 134 / Thursday, July 13, 2006 / Notices
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.15
Nancy M. Morris,
Secretary.
[FR Doc. E6–11002 Filed 7–12–06; 8:45 am]
BILLING CODE 8010–01–P
DEPARTMENT OF STATE
State (telephone: 202/453–8052). The
address is U.S. Department of State, SA–
44, 301 4th Street, SW., Room 700,
Washington, DC 20547–0001.
Dated: July 6, 2006.
C. Miller Crouch,
Principal Deputy Assistant Secretary for
Educational and Cultural Affairs, Department
of State.
[FR Doc. E6–11048 Filed 7–12–06; 8:45 am]
BILLING CODE 4710–05–P
Culturally Significant Objects Imported
for Exhibition Determinations: ‘‘Gregor
Mendel: Planting the Seeds of
Genetics’’
sroberts on PROD1PC70 with NOTICES
[Public Notice 5463]
DEPARTMENT OF STATE
Summary: Notice is hereby given of
the following determinations: Pursuant
to the authority vested in me by the Act
of October 19, 1965 (79 Stat. 985; 22
U.S.C. 2459), Executive Order 12047 of
March 27, 1978, the Foreign Affairs
Reform and Restructuring Act of 1998
(112 Stat. 2681, et seq.; 22 U.S.C. 6501
note, et seq.), Delegation of Authority
No. 234 of October 1, 1999, Delegation
of Authority No. 236 of October 19,
1999, as amended, and Delegation of
Authority No. 257 of April 15, 2003 [68
FR 19875], I hereby determine that the
objects to be included in the exhibition
‘‘Gregor Mendel: Planting the Seeds of
Genetics’’, imported from abroad for
temporary exhibition within the United
States, are of cultural significance. The
objects are imported pursuant to loan
agreements with the foreign owners or
custodians. I also determine that the
exhibition or display of the exhibit
objects at The Field Museum, Chicago,
Illinois, beginning on or about
September 15, 2006, until on or about
April 1, 2007, at a second venue yet to
be determined, beginning on or about
April 2007, until on or about September
2007, at the Center of Science and
Industry, Columbus, Ohio, beginning on
or about October 13, 2007, until on or
about January 6, 2008, at Pink Palace
Family of Museums, Memphis,
Tennessee, beginning on or about
February 2, 2008, until on or about
April 27, 2008, and at Academy of
Natural Sciences, Philadelphia,
Pennsylvania, beginning on or about
May 24. 2008, until on or about
September 28, 2008, and at possible
additional venues yet to be determined,
is in the national interest. Public Notice
of these Determinations is ordered to be
published in the Federal Register.
For Further Information Contact: For
further information, including a list of
the exhibit objects, contact Paul
Manning, Attorney-Adviser, Office of
the Legal Adviser, U.S. Department of
15 17
CFR 200.30–3(a)(12).
VerDate Aug<31>2005
17:46 Jul 12, 2006
Jkt 208001
[Public Notice 5464]
Rescission of Determination
Regarding Libya
In accordance with section 6(j) of the
Export Administration Act of 1979 (50
U.S.C. App. 2405(j)), and as continued
in effect by Executive Order 13222 of
August 17, 2001, I hereby rescind the
Determination of December 29, 1979
regarding Libya (Public Notice 1264).
This action is based upon the
considerations contained in the
memorandum accompanying
Presidential Determination No. 2006–14
of May 12, 2006, [71 FR 31909]
This rescission shall also satisfy the
provisions of section 620A(c) of the
Foreign Assistance Act of 1961, Public
Law 87–195, as amended (22 U.S.C.
2371(c)), and section 40(f) of the Arms
Export Control Act, Public Law 90–629,
as amended (22 U.S.C. 2780(f)).
Dated: June 30, 2006.
Condoleezza Rice,
Secretary of State, Department of State.
[FR Doc. E6–11046 Filed 7–12–06; 8:45 am]
BILLING CODE 4710–31–P
Special Passenger Amending Between
Sri Lanka and India (Memo 0983).
Intended effective date: 31 October
2006.
Docket Number: OST–2006–25170.
Date Filed: June 20, 2006.
Parties: Members of the International
Air Transport Association.
Subject:
CAC/34/Meet/011/06 dated 15 June
2006
Normal Resolutions 801/801a/801r/
801re/803/805/805zz/807/809/809zz/
813/815/815e
(Minutes relevant to the Resolutions are
included in CAC/34/Meet/010/06
dated 14 June 2006).
Intended effective date: 1 October 2006.
Docket Number: OST–2006–25172.
Date Filed: June 20, 2006.
Parties: Members of the International
Air Transport Association.
Subject:
TC2 Within Europe
Expedited Resolutions (Memo 0636)
Minutes: TC2 Within Europe (Memo
0637).
Intended effective date: 15 July 2006.
Docket Number: OST–2006–25179.
Date Filed: June 21, 2006.
Parties: Members of the International
Air Transport Association.
Subject:
Mail Vote 491—Resolution 010r
TC3 Japan, Korea-South East Asia
Special Passenger Amending between
Japan and Russia (in Asia) (Memo
0984).
Intended effective date: 1 July 2006.
Renee V. Wright,
Program Manager, Docket Operations,
Federal Register Liaison.
[FR Doc. E6–11036 Filed 7–12–06; 8:45 am]
BILLING CODE 4910–9X–P
DEPARTMENT OF TRANSPORTATION
DEPARTMENT OF TRANSPORTATION
Office of the Secretary
Aviation Proceedings, Agreements
Filed the Week Ending June 23, 2006
The following Agreements were filed
with the Department of Transportation
under Sections 412 and 414 of the
Federal Aviation Act, as amended (49
U.S.C. 1382 and 1384) and procedures
governing proceedings to enforce these
provisions. Answers may be filed within
21 days after the filing of the
application.
Docket Number: OST–2006–25151.
Date Filed: June 19, 2006.
Parties: Members of the International
Air Transport Association.
Subject:
Mail Vote 490—Resolution 010q
TC3 Within South Asian Subcontinent
PO 00000
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Sfmt 4703
Office of the Secretary
Notice of Applications for Certificates
of Public Convenience and Necessity
and Foreign Air Carrier Permits Filed
Under Subpart B (Formerly Subpart Q)
During the Week Ending June 23, 2006
The following Applications for
Certificates of Public Convenience and
Necessity and Foreign Air Carrier
Permits were filed under Subpart B
(formerly Subpart Q) of the Department
of Transportation’s Procedural
Regulations (See 14 CFR 301.201 et
seq.). The due date for Answers,
Conforming Applications, or Motions to
Modify Scope are set forth below for
each application. Following the Answer
period DOT may process the application
E:\FR\FM\13JYN1.SGM
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]]>Agencies
[Federal Register Volume 71, Number 134 (Thursday, July 13, 2006)]
[Notices]
[Pages 39694-39696]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-11002]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54113 File No. SR-ISE-2006-24]
Self-Regulatory Organizations; International Securities Exchange,
Inc.; Order Approving a Proposed Rule Change and Amendment No. 1
Thereto and Notice of Filing and Order Granting Accelerated Approval to
Amendments No. 2 and 3 Thereto To Permit the Listing and Trading of
Quarterly Options Series
July 7, 2006.
I. Introduction
On May 2, 2006, the International Securities Exchange, Inc.
(``ISE'' or ``Exchange'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to initiate a one-year pilot
program that would allow the Exchange to list and trade options series
that expire at the close of business on the last business day of a
calendar quarter (``Quarterly Options Series''). The Exchange filed
Amendment No. 1 with the Commission on May 17, 2006.\3\ The amended
proposal was published for comment in the Federal Register on June 1,
2006.\4\ No comments were received regarding the amended proposal. The
Exchange filed Amendments No. 2 and 3 with the Commission on July 6,
2006, and July 7, 2006, respectively.\5\ This notice and order approves
the proposed rule change and Amendment No. 1 thereto, solicits comment
on Amendments No. 2 and 3, and approves Amendments No. 2 and 3 on an
accelerated basis.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ In Amendment No. 1, a partial amendment, the Exchange made
minor modifications to the proposed rule text.
\4\ See Securities Exchange Act Release No. 53857 (May 24,
2006), 71 FR 31246 (``Notice'').
\5\ In Amendment No. 2, a partial amendment, the Exchange
modified the provision of the proposed rule text under which the
Exchange may list additional strike prices for Quarterly Options
Series. In Amendment No. 3, a partial amendment, the Exchange
modified the proposed rule text to provide that the Exchange may
list Quarterly Options Series with strike prices that are within
$5.00 from the closing price of the underlying security on the
preceding trading day. See discussion in Part II, infra.
---------------------------------------------------------------------------
II. Description of Proposed Rule
ISE proposes to amend its rules to establish a pilot program to
list and trade Quarterly Options Series, which would expire at the
close of business on the last business day of a calendar quarter
(``Pilot Program''). Under the proposal, the Exchange could select up
to five approved options classes \6\ on which Quarterly Options Series
could be opened. A series could be opened on any business day and would
expire at the close of business on the last business day of a calendar
quarter. The Exchange also could list and trade Quarterly Options
Series on any options class that is selected by another exchange that
employs a similar pilot program. For each class selected for the Pilot
Program, the Exchange would list series that expire at the end of the
next four consecutive calendar quarters, as well as the fourth quarter
of the following calendar year.
---------------------------------------------------------------------------
\6\ Quarterly Options Series may be opened on indexes or on
Exchange Traded Funds that satisfy the applicable listing criteria
under ISE rules.
---------------------------------------------------------------------------
Quarterly Options Series listed on currently approved options
classes would be P.M. settled and, in all other respects, would settle
in the same manner as do the monthly expiration series in the same
options class.
The strike price for each series would be fixed at a price per
share, with two strike prices above and two strike prices below the
value of the underlying security at about the time that a Quarterly
Options Series is opened for trading on the Exchange. The interval
between strike prices on Quarterly Options Series would be the same as
the interval between strike prices for series in the same options class
that expire in accordance with the normal monthly expiration cycles. In
Amendment No. 3,
[[Page 39695]]
the Exchange proposes rule text providing that the series listed by the
Exchange under the Pilot Program would have strike prices that are
within $5.00 from the closing price of the underlying security on the
preceding trading day.
The proposal would permit the Exchange to open for trading
additional Quarterly Options Series of the same class when the Exchange
deems it necessary to maintain an orderly market, to meet customer
demand, or when the market price of the underlying security moves
substantially from the initial exercise price or prices. In Amendment
No. 2, the Exchange proposes rule text that provides that any
additional series opened for trading by the Exchange would be priced
within $5.00 of the closing price of the underlying security on the
preceding trading day.
ISE proposes that the Pilot Program extend one year from the date
the Exchange first initiates trading in a Quarterly Options Series,
which, as per the proposed rules, would be no later than July 24,
2006.\7\
---------------------------------------------------------------------------
\7\ See ISE Proposed Rules 504, Supplementary Material .03, and
2009, Supplementary Material .02.
---------------------------------------------------------------------------
III. Discussion
After careful review, the Commission finds that the proposal, as
amended, is consistent with the requirements of the Act and the rules
and regulations thereunder applicable to a national securities
exchange.\8\ In particular, the Commission believes that the proposal
is consistent with the requirements of Section 6(b)(5) of the Act,\9\
which requires, among other things, that the rules of a national
securities exchange be designed to remove impediments to and perfect
the mechanism of a free and open market and a national market system,
to promote just and equitable principles of trade, and, in general, to
protect investors and the public interest.
---------------------------------------------------------------------------
\8\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
\9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Commission believes that allowing the Exchange to list and
trade Quarterly Options Series, under the terms described in the
Exchange's proposal, should provide investors with new means of
managing their risk exposures and carrying out their investment
objectives. The Commission notes that the Pilot Program limits the
series that may be opened pursuant to the Pilot Program by requiring
them to have strike prices within $5.00 of the closing price of the
underlying security on the preceding trading day. The Commission
believes this restriction should allow the exchange to offer a wider
array of investment opportunities, while minimizing the impact on
quotation message traffic. The Commission also notes that the proposal
requires the Exchange to closely monitor the trading and quotation
volume associated with the additional options series created under the
Pilot Program and the effect of these additional series on the capacity
of the Exchange's, OPRA's, and vendors' systems.\10\
---------------------------------------------------------------------------
\10\ If the Exchange were to propose an extension, expansion, or
permanent approval of the Pilot Program, the Exchange would be
required to submit a report on the Pilot Program to the Commission
at least 60 days prior to the Pilot Program expiration date. See
Notice, supra note 4, at 31248.
---------------------------------------------------------------------------
Pursuant to Section 19(b)(2) of the Act,\11\ the Commission finds
good cause for approving the amended proposal prior to the thirtieth
day after the publication of Amendments No. 2 and 3 in the Federal
Register. Amendments No. 2 and 3 modify the proposed rule text by
placing restrictions on the series the Exchange may open for trading in
an approved class. Any series opened for trading pursuant to the Pilot
Program would have strike prices within $5.00 of the closing price of
the underlying security on the preceding trading day. This restriction
is modeled after the identical provision previously approved as part of
the Exchange's $1 Strike Pilot Program, and thus raises no new issues
of regulatory concern.\12\ The Commission finds good cause to
accelerate approval of the amended proposal because it believes this
restriction should help to minimize the Pilot Program's impact on
quotation message traffic.
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\11\ 15 U.S.C. 78s(b)(2).
\12\ See ISE Rule 504(g).
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IV. Solicitation of Comments Concerning Amendments No. 2 and 3
Interested persons are invited to submit written data, views, and
arguments concerning Amendments No. 2 and 3, including whether it is
consistent with the Act. Comments may be submitted by any of the
following methods:
Electronic Comments
Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-ISE-2006-24 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-ISE-2006-24. 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 (https://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. 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-ISE-2006-24 and should be submitted on or before August
3, 2006.
V. Conclusion
For the foregoing reasons, the Commission finds that the proposed
rule change, as amended, is consistent with the requirements of the Act
and the rules and regulations thereunder.
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\13\ that the proposed rule change (File No. SR-ISE-2006-24), as
amended, is approved, and that Amendments No. 2 and 3 thereto are
approved on an accelerated basis, as a pilot program for a one-year
period commencing on the day the Exchange first initiates trading in a
Quarterly Options Series, which, as per the proposed rules, would be no
later than July 24, 2006.\14\
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\13\ Id.
\14\ See ISE Proposed Rules 504, Supplementary Material .03, and
2009, Supplementary Material .02.
[[Page 39696]]
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For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-11002 Filed 7-12-06; 8:45 am]
BILLING CODE 8010-01-P
