Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing of Proposed Rule Change Amending CBOE Rules 5.3 and 5.4 To Enable the Listing and Trading of Options on Index-Linked Securities, 37516-37518 [E8-14831]
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37516
Federal Register / Vol. 73, No. 127 / Tuesday, July 1, 2008 / Notices
no less than the amount which would
be payable if the employee’s railroad
service had been covered by the Social
Security Act. The Social Security
Overall Minimum Guarantee is
prescribed in 20 CFR part 229. To
administer this provision, the Railroad
Retirement Board (RRB) requires
information about a retired employee’s
spouse and child(ren) who would not be
eligible for benefits under the RRA but
would be eligible for benefits under the
Social Security Act if the employee’s
railroad service had been covered by
that Act. The RRB obtains the required
information by the use of forms G–319
(Statement Regarding Family and
Earnings for Special Guaranty
Computation) and G–320 (Statement by
Employee Annuitant Regarding Student
Age 18–19). One form is completed by
each respondent. The RRB proposes no
changes to Form G–319 or Form G–320.
ESTIMATE OF ANNUAL RESPONDENT BURDEN
The estimated annual respondent burden is as follows:
Annual responses
Form No.(s)
G–319 Employee Completed:
With assistance ................................................................................................................................
Without assistance ...........................................................................................................................
G–319 Spouse Completed:
With assistance ................................................................................................................................
Without assistance ...........................................................................................................................
G–320:
(Age 18 at Special Guaranty begin date or Special Guaranty Age 18 Attainments) ......................
(Student monitoring done in Sept, March, and at end of school year) ...........................................
Charles Mierzwa,
Clearance Officer.
[FR Doc. E8–14825 Filed 6–30–08; 8:45 am]
BILLING CODE 7905–01–P
SECURITIES AND EXCHANGE
COMMISSION
sroberts on PROD1PC70 with NOTICES
[Release No. 34–58007; File No. SR–CBOE–
2008–64]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of
Proposed Rule Change Amending
CBOE Rules 5.3 and 5.4 To Enable the
Listing and Trading of Options on
Index-Linked Securities
June 24, 2008.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
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21:01 Jun 30, 2008
Jkt 214001
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 19,
2008, the 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
substantially 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
The Exchange proposes to revise
CBOE Rules 5.3 and 5.4 to enable the
listing and trading on the Exchange of
options on Index-Linked Securities. The
text of the proposed rule change is
available at the Exchange, the
Commission’s Public Reference Room,
and https://www.cboe.com.
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
1 15
2 17
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00110
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Burden (hrs)
5
100
26
5
2
92
5
100
30
60
3
100
95
170
15
15
24
43
475
Total ...........................................................................................................................................
Additional Information or Comments:
To request more information or to
obtain a copy of the information
collection justification, forms, and/or
supporting material, please call the RRB
Clearance Officer at (312) 751–3363 or
send an e-mail request to
Charles.Mierzwa@RRB.GOV. Comments
regarding the information collection
should be addressed to Ronald J.
Hodapp, Railroad Retirement Board, 844
North Rush Street, Chicago, Illinois
60611–2092 or send an e-mail to
Ronald.Hodapp@RRB.GOV. Written
comments should be received within 60
days of this notice.
Time (min)
....................
264
Exchange 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
The Exchange states that the purpose
of the proposed rule change is to revise
CBOE Rules 5.3 and 5.4 to enable the
listing and trading of options on equity
index-linked securities (‘‘Equity IndexLinked Securities’’), commodity-linked
securities (‘‘Commodity-Linked
Securities’’), currency-linked securities
(‘‘Currency-Linked Securities’’), fixed
income index-linked securities (‘‘Fixed
Income Index-Linked Securities’’),
futures-linked securities (‘‘FuturesLinked Securities’’), and multifactor
index-linked securities (‘‘Multifactor
Index-Linked Securities’’), collectively
known as (‘‘Index-Linked Securities’’)
that are principally traded on a national
securities exchange and an ‘‘NMS
stock’’ (as defined in Rule 600 of
Regulation NMS under the Act).
Index-Linked Securities are designed
for investors who desire to participate in
a specific market segment by providing
exposure to one or more identifiable
underlying securities, commodities,
currencies, derivative instruments, or
market indexes of the foregoing
(‘‘Underlying Index’’ or ‘‘Underlying
Indexes’’). Index-Linked Securities are
the non-convertible debt of an issuer
that have a term of at least one year but
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Federal Register / Vol. 73, No. 127 / Tuesday, July 1, 2008 / Notices
not greater than thirty years. Despite the
fact that Index-Linked Securities are
linked to an underlying index, each
trade as a single, exchange-listed
security. Accordingly, rules pertaining
to the listing and trading of standard
equity options would apply to IndexLinked Securities. The Exchange does
not propose any changes to rules
pertaining to Index Options.
sroberts on PROD1PC70 with NOTICES
Listing Criteria
The Exchange will consider listing
and trading options on Index-Linked
Securities provided the Index-Liked
Securities meet the criteria for
underlying securities set forth in CBOE
Rule 5.3(a)–(b) and Interpretation and
Policy .01 to Rule 5.3.
The Exchange proposes that IndexLinked Securities deemed appropriate
for options trading represent ownership
of a security that provides for the
payment at maturity, as described
below:
• Equity Index-Linked Securities are
securities that provide for the payment
at maturity of a cash amount based on
the performance of an underlying index
or indexes of equity securities (‘‘Equity
Reference Asset’’);
• Commodity-Linked Securities are
securities that provide for the payment
at maturity of a cash amount based on
the performance of one or more physical
commodities or commodity futures,
options or other commodity derivatives
or Commodity-Based Trust Shares or a
basket or index of any of the foregoing
(‘‘Commodity Reference Asset’’);
• Currency-Linked Securities are
securities that provide for the payment
at maturity of a cash amount based on
the performance of one or more
currencies, or options or currency
futures or other currency derivatives or
Currency Trust Shares 3 or a basket or
index of any of the foregoing (‘‘Currency
Reference Asset’’);
• Fixed Income Index-Linked
Securities are securities that provide for
the payment at maturity of a cash
amount based on the performance of
one or more notes, bonds, debentures, or
evidence of indebtedness that include,
but are not limited to, U.S. Department
of Treasury securities (‘‘Treasury
Securities’’), government-sponsored
entity securities (‘‘GSE Securities’’),
3 See Interpretation and Policy. 06 to CBOE Rule
5.3. The term ‘‘Currency Trust Shares’’ is defined
as a security that: (a) Is issued by a trust or similar
entity that holds a specified non-U.S. currency
deposited with the trust or similar entity; (b) when
aggregated in some specified minimum number
may be surrendered to the trust by the beneficial
owner to receive the specified non-U.S. currency;
and (c) pays the beneficial owner interest and other
distributions on the deposited non-U.S. currency, if
any, declared and paid by the trust.
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21:01 Jun 30, 2008
Jkt 214001
municipal securities, trust preferred
securities, supranational debt and debt
of a foreign country or a subdivision
thereof or a basket or index of any of the
foregoing (‘‘Fixed Income Reference
Asset’’);
• Futures-Linked Securities are
securities that provide for the payment
at maturity of a cash amount based on
the performance of an index of (a)
futures on Treasury Securities, GSE
Securities, supranational debt and debt
of a foreign country or a subdivision
thereof, or options or other derivatives
on any of the foregoing; or (b) interest
rate futures or options or derivatives on
the foregoing in this subparagraph (b)
(‘‘Futures Reference Asset’’); and
• Multifactor Index-Linked Securities
are securities that provide for the
payment at maturity of a cash amount
based on the performance of any
combination of two or more Equity
Reference Assets, Commodity Reference
Assets, Currency Reference Assets,
Fixed Income Reference Assets or
Futures Reference Assets (‘‘Multifactor
Reference Asset’’).
For the purposes of Interpretation and
Policy .13 to CBOE Rule 5.3, Equity
Reference Assets, Commodity Reference
Assets, Currency Reference Assets,
Fixed Income Reference Assets, Futures
Reference Assets, and Multifactor
Reference Assets, would be collectively
referred to as ‘‘Reference Assets.’’
Index-Linked Securities must meet
the criteria and guidelines for
underlying securities set forth in
Interpretation and Policy .01 to CBOE
Rule 5.3, or the Index-Linked Securities
must be redeemable at the option of the
holder at least on a weekly basis
through the issuer at a price related to
the applicable underlying Reference
Asset. In addition, the issuing company
is obligated to issue or repurchase the
securities in aggregation units for cash
or cash equivalents satisfactory to the
issuer of Index-Linked Securities which
underlie the option as described in the
Index-Linked Securities prospectus.
Continued Listing Requirements
Options on Index-Linked Securities
would be subject to all Exchange rules
governing the trading of equity options.
The current continuing or maintenance
listing standards for options traded on
CBOE would continue to apply.
The Exchange proposes to establish
Interpretation and Policy .16 to CBOE
Rule 5.4 which would include criteria
related to the continued listing of
options on Index-Linked Securities.
Under the applicable continued
listing criteria in proposed
Interpretation and Policy .16 to CBOE
Rule 5.4, options on Index Linked
PO 00000
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37517
Securities initially approved for trading
pursuant to proposed Interpretation and
Policy .13 to CBOE Rule 5.3 may be
subject to the suspension of opening
transactions as follows: (1) Noncompliance with the terms of
Interpretation and Policy .13 to CBOE
Rule 5.3; (2) non-compliance with the
terms of Interpretation and Policy .01 to
CBOE Rule 5.4, except that in the case
of options covering Index-Linked
Securities approved pursuant to
Interpretation and Policy .13(3)(B) to
CBOE Rule 5.3 that are redeemable at
the option of the holder at least on a
weekly basis, then option contracts of
the class covering such Securities may
only continue to be open for trading as
long as the Securities are listed on a
national securities exchange and are an
‘‘NMS stock’’ as defined in Rule 600 of
Regulation NMS; (3) in the case of any
Index-Linked Security trading pursuant
to Interpretation and Policy .13 to CBOE
Rule 5.3, the value of the Reference
Asset is no longer calculated or
available; or (4) such other event shall
occur or condition exist that in the
opinion of the Exchange makes further
dealing in such options on the Exchange
inadvisable.
The Exchange represents that the
listing and trading of options on IndexLinked Securities under Interpretation
and Policy .13 to CBOE Rule 5.3 will not
have any effect on the rules pertaining
to position and exercise limits 4 or
margin.5
The Exchange states that it will
implement surveillance procedures for
options on Index-Linked Securities,
including adequate comprehensive
surveillance sharing agreements with
markets trading in non-U.S.
components, as applicable. CBOE
represents that these procedures will be
adequate to properly monitor Exchange
trading of options on these securities
and to deter and detect violations of
Exchange rules.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,6 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,7 in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
facilitating transactions in securities,
and to remove impediments to and
4 See
CBOE Rules 4.11 and 4.12.
CBOE Rule 12.3.
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(5).
5 See
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Federal Register / Vol. 73, No. 127 / Tuesday, July 1, 2008 / Notices
perfect the mechanisms of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest. The
Exchange believes that the proposed
rules applicable to trading pursuant to
generic listing and trading criteria,
together with the Exchange’s
surveillance procedures applicable to
trading in the securities covered by the
proposed rules, serve to foster investor
protection.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is 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
The Exchange states that written
comments on the proposed rule change
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 Exchange 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.
The CBOE has requested accelerated
approval of this proposed rule change
prior to the 30th day after the date of
publication of the notice of the filing
thereof. The Commission has
determined that a 15-day comment
period is appropriate in this case.
IV. Solicitation of Comments
sroberts on PROD1PC70 with NOTICES
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:
Number SR–CBOE–2008–64 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper Comments
[Release No. 34–58016, File No. SR–MSRB–
2008–04]
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street, NE.,
Washington, DC 20549–1090.
Self-Regulatory Organizations;
Municipal Securities Rulemaking
Board; Order Granting Approval of
Proposed Rule Change Relating to
All submissions should refer to File
MSRB Rule G–34, CUSIP Numbers and
Number SR–CBOE–2008–64. This file
New Issue Requirements, to Require
number should be included on the
Underwriter Registration and Testing
subject line if e-mail is used. To help the with Depository Trust and Clearing
Commission process and review your
Corporation’s New Issue Information
comments more efficiently, please use
Dissemination System
only one method. The Commission will
post all comments on the Commission’s June 25, 2008.
On May 9, 2008, the Municipal
Internet Web site (https://www.sec.gov/
Securities Rulemaking Board (‘‘MSRB’’),
rules/sro.shtml). Copies of the
filed with the Securities and Exchange
submission, all subsequent
Commission (‘‘Commission’’), pursuant
amendments, all written statements
to Section 19(b)(1) of the Securities
with respect to the proposed rule
Exchange Act of 1934 (‘‘Act’’),1 and
change that are filed with the
Rule 19b–4 thereunder,2 a proposed rule
Commission, and all written
change consisting of changes to Rule G–
communications relating to the
34, CUSIP Numbers and New Issue
proposed rule change between the
Requirements. The proposed rule
Commission and any person, other than change was published for comment in
those that may be withheld from the
the Federal Register on May 22, 2008.3
public in accordance with the
The Commission received no comment
provisions of 5 U.S.C. 552, will be
letters about the proposed rule change.
available for inspection and copying in
This order approves the proposed rule
the Commission’s Public Reference
change.
The proposed rule change would
Room, 100 F Street, NE., Washington,
require underwriters to register and
DC 20549, on official business days
between the hours of 10 a.m. and 3 p.m. conduct tests with the Depository Trust
Copies of the filing also will be available and Clearing Corporation’s (‘‘DTCC’’)
New Issue Information Dissemination
for inspection and copying at the
System (‘‘NIIDS’’). The proposed rule
principal office of the Exchange. All
change would help ensure that dealers
comments received will be posted
are prepared for the September 30, 2008
without change; the Commission does
effective date of changes to other MSRB
not edit personal identifying
rules to require underwriters to
information from submissions. You
participate in NIIDS.4 Accordingly, the
should submit only information that
proposed rule change would require all
you wish to make available publicly. All
brokers, dealers and municipal
submissions should refer to File
securities dealers (collectively
Number SR–CBOE–2008–64 and should ‘‘dealers’’) that have acted as
be submitted on or before July 16, 2008. underwriter 5 in the last year on a new
issue of municipal securities with nine
For the Commission, by the Division of
months or greater effective maturity to
Trading and Markets, pursuant to delegated
register to use NIIDS with DTCC and
authority.8
successfully test NIIDS prior to
Florence E. Harmon,
September 15, 2008.6 On an ongoing
Acting Secretary.
[FR Doc. E8–14831 Filed 6–30–08; 8:45 am]
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8 17
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CFR 200.30–3(a)(12).
Frm 00112
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 57830
(May 16, 2008), 73 FR 29799 (May 22, 2008)
(‘‘Commission’s Notice’’).
4 See Securities Exchange Act Release No. 57750
(May 1, 2008), 73 FR 25815 (May 7, 2008).
5 Rule G–34 defines ‘‘underwriter’’ very broadly
to include a dealer acting as a placement agent as
well as any dealer purchasing new issue securities
from the issuer as principal. If there is an
underwriting syndicate, the lead manager is
considered to be the ‘‘underwriter’’ for purposes of
Rule G–34.
6 Many underwriters have already registered with
DTCC and initiated NIIDS testing. The proposed
2 17
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
1 15
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]]>Agencies
[Federal Register Volume 73, Number 127 (Tuesday, July 1, 2008)]
[Notices]
[Pages 37516-37518]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-14831]
=======================================================================
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58007; File No. SR-CBOE-2008-64]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing of Proposed Rule Change Amending CBOE
Rules 5.3 and 5.4 To Enable the Listing and Trading of Options on
Index-Linked Securities
June 24, 2008.
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 June 19, 2008, the 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 substantially
prepared by the Exchange. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to revise CBOE Rules 5.3 and 5.4 to enable
the listing and trading on the Exchange of options on Index-Linked
Securities. The text of the proposed rule change is available at the
Exchange, the Commission's Public Reference Room, and https://
www.cboe.com.
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.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange states that the purpose of the proposed rule change is
to revise CBOE Rules 5.3 and 5.4 to enable the listing and trading of
options on equity index-linked securities (``Equity Index-Linked
Securities''), commodity-linked securities (``Commodity-Linked
Securities''), currency-linked securities (``Currency-Linked
Securities''), fixed income index-linked securities (``Fixed Income
Index-Linked Securities''), futures-linked securities (``Futures-Linked
Securities''), and multifactor index-linked securities (``Multifactor
Index-Linked Securities''), collectively known as (``Index-Linked
Securities'') that are principally traded on a national securities
exchange and an ``NMS stock'' (as defined in Rule 600 of Regulation NMS
under the Act).
Index-Linked Securities are designed for investors who desire to
participate in a specific market segment by providing exposure to one
or more identifiable underlying securities, commodities, currencies,
derivative instruments, or market indexes of the foregoing
(``Underlying Index'' or ``Underlying Indexes''). Index-Linked
Securities are the non-convertible debt of an issuer that have a term
of at least one year but
[[Page 37517]]
not greater than thirty years. Despite the fact that Index-Linked
Securities are linked to an underlying index, each trade as a single,
exchange-listed security. Accordingly, rules pertaining to the listing
and trading of standard equity options would apply to Index-Linked
Securities. The Exchange does not propose any changes to rules
pertaining to Index Options.
Listing Criteria
The Exchange will consider listing and trading options on Index-
Linked Securities provided the Index-Liked Securities meet the criteria
for underlying securities set forth in CBOE Rule 5.3(a)-(b) and
Interpretation and Policy .01 to Rule 5.3.
The Exchange proposes that Index-Linked Securities deemed
appropriate for options trading represent ownership of a security that
provides for the payment at maturity, as described below:
Equity Index-Linked Securities are securities that provide
for the payment at maturity of a cash amount based on the performance
of an underlying index or indexes of equity securities (``Equity
Reference Asset'');
Commodity-Linked Securities are securities that provide
for the payment at maturity of a cash amount based on the performance
of one or more physical commodities or commodity futures, options or
other commodity derivatives or Commodity-Based Trust Shares or a basket
or index of any of the foregoing (``Commodity Reference Asset'');
Currency-Linked Securities are securities that provide for
the payment at maturity of a cash amount based on the performance of
one or more currencies, or options or currency futures or other
currency derivatives or Currency Trust Shares \3\ or a basket or index
of any of the foregoing (``Currency Reference Asset'');
---------------------------------------------------------------------------
\3\ See Interpretation and Policy. 06 to CBOE Rule 5.3. The term
``Currency Trust Shares'' is defined as a security that: (a) Is
issued by a trust or similar entity that holds a specified non-U.S.
currency deposited with the trust or similar entity; (b) when
aggregated in some specified minimum number may be surrendered to
the trust by the beneficial owner to receive the specified non-U.S.
currency; and (c) pays the beneficial owner interest and other
distributions on the deposited non-U.S. currency, if any, declared
and paid by the trust.
---------------------------------------------------------------------------
Fixed Income Index-Linked Securities are securities that
provide for the payment at maturity of a cash amount based on the
performance of one or more notes, bonds, debentures, or evidence of
indebtedness that include, but are not limited to, U.S. Department of
Treasury securities (``Treasury Securities''), government-sponsored
entity securities (``GSE Securities''), municipal securities, trust
preferred securities, supranational debt and debt of a foreign country
or a subdivision thereof or a basket or index of any of the foregoing
(``Fixed Income Reference Asset'');
Futures-Linked Securities are securities that provide for
the payment at maturity of a cash amount based on the performance of an
index of (a) futures on Treasury Securities, GSE Securities,
supranational debt and debt of a foreign country or a subdivision
thereof, or options or other derivatives on any of the foregoing; or
(b) interest rate futures or options or derivatives on the foregoing in
this subparagraph (b) (``Futures Reference Asset''); and
Multifactor Index-Linked Securities are securities that
provide for the payment at maturity of a cash amount based on the
performance of any combination of two or more Equity Reference Assets,
Commodity Reference Assets, Currency Reference Assets, Fixed Income
Reference Assets or Futures Reference Assets (``Multifactor Reference
Asset'').
For the purposes of Interpretation and Policy .13 to CBOE Rule 5.3,
Equity Reference Assets, Commodity Reference Assets, Currency Reference
Assets, Fixed Income Reference Assets, Futures Reference Assets, and
Multifactor Reference Assets, would be collectively referred to as
``Reference Assets.''
Index-Linked Securities must meet the criteria and guidelines for
underlying securities set forth in Interpretation and Policy .01 to
CBOE Rule 5.3, or the Index-Linked Securities must be redeemable at the
option of the holder at least on a weekly basis through the issuer at a
price related to the applicable underlying Reference Asset. In
addition, the issuing company is obligated to issue or repurchase the
securities in aggregation units for cash or cash equivalents
satisfactory to the issuer of Index-Linked Securities which underlie
the option as described in the Index-Linked Securities prospectus.
Continued Listing Requirements
Options on Index-Linked Securities would be subject to all Exchange
rules governing the trading of equity options. The current continuing
or maintenance listing standards for options traded on CBOE would
continue to apply.
The Exchange proposes to establish Interpretation and Policy .16 to
CBOE Rule 5.4 which would include criteria related to the continued
listing of options on Index-Linked Securities.
Under the applicable continued listing criteria in proposed
Interpretation and Policy .16 to CBOE Rule 5.4, options on Index Linked
Securities initially approved for trading pursuant to proposed
Interpretation and Policy .13 to CBOE Rule 5.3 may be subject to the
suspension of opening transactions as follows: (1) Non-compliance with
the terms of Interpretation and Policy .13 to CBOE Rule 5.3; (2) non-
compliance with the terms of Interpretation and Policy .01 to CBOE Rule
5.4, except that in the case of options covering Index-Linked
Securities approved pursuant to Interpretation and Policy .13(3)(B) to
CBOE Rule 5.3 that are redeemable at the option of the holder at least
on a weekly basis, then option contracts of the class covering such
Securities may only continue to be open for trading as long as the
Securities are listed on a national securities exchange and are an
``NMS stock'' as defined in Rule 600 of Regulation NMS; (3) in the case
of any Index-Linked Security trading pursuant to Interpretation and
Policy .13 to CBOE Rule 5.3, the value of the Reference Asset is no
longer calculated or available; or (4) such other event shall occur or
condition exist that in the opinion of the Exchange makes further
dealing in such options on the Exchange inadvisable.
The Exchange represents that the listing and trading of options on
Index-Linked Securities under Interpretation and Policy .13 to CBOE
Rule 5.3 will not have any effect on the rules pertaining to position
and exercise limits \4\ or margin.\5\
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\4\ See CBOE Rules 4.11 and 4.12.
\5\ See CBOE Rule 12.3.
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The Exchange states that it will implement surveillance procedures
for options on Index-Linked Securities, including adequate
comprehensive surveillance sharing agreements with markets trading in
non-U.S. components, as applicable. CBOE represents that these
procedures will be adequate to properly monitor Exchange trading of
options on these securities and to deter and detect violations of
Exchange rules.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\6\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\7\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in facilitating
transactions in securities, and to remove impediments to and
[[Page 37518]]
perfect the mechanisms of a free and open market and a national market
system, and, in general, to protect investors and the public interest.
The Exchange believes that the proposed rules applicable to trading
pursuant to generic listing and trading criteria, together with the
Exchange's surveillance procedures applicable to trading in the
securities covered by the proposed rules, serve to foster investor
protection.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is 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
The Exchange states that written comments on the proposed rule
change 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 Exchange 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.
The CBOE has requested accelerated approval of this proposed rule
change prior to the 30th day after the date of publication of the
notice of the filing thereof. The Commission has determined that a 15-
day comment period is appropriate in this case.
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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-CBOE-2008-64 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2008-64. 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, 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 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-2008-64 and should be
submitted on or before July 16, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-14831 Filed 6-30-08; 8:45 am]
BILLING CODE 8010-01-P
