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]

Download as PDF 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 VerDate Aug<31>2005 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 http://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 Fmt 4703 Sfmt 4703 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 E:\FR\FM\01JYN1.SGM 01JYN1 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. VerDate Aug<31>2005 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 Frm 00111 Fmt 4703 Sfmt 4703 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 E:\FR\FM\01JYN1.SGM 01JYN1 37518 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 (http://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] BILLING CODE 8010–01–P VerDate Aug<31>2005 21:01 Jun 30, 2008 Jkt 214001 8 17 PO 00000 CFR 200.30–3(a)(12). Frm 00112 Fmt 4703 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 (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File 1 15 Sfmt 4703 E:\FR\FM\01JYN1.SGM 01JYN1

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 http://
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\
---------------------------------------------------------------------------

    \4\ See CBOE Rules 4.11 and 4.12.
    \5\ See CBOE Rule 12.3.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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 (http://
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 (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 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