Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing of Proposed Rule Change Relating to Amendments to Certain Rules Applicable to Stock Futures, 33794-33796 [2012-13767]
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33794
Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Notices
that trading in the securities of
Optimized Transportation Management
is suspended for the period from
9:30 a.m. EDT on June 5, 2012, through
11:59 p.m. EDT on June 18, 2012.
By the Commission.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2012–13933 Filed 6–5–12; 4:15 pm]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[File No. 500–1]
Future Now Group, Inc., and
Gammacan International, Inc.; Order of
Suspension of Trading
because it has not filed a periodic report
since it filed its Form 10–Q for the
period ending March 31, 2009, filed on
May 20, 2009.
The Commission is of the opinion that
the public interest and the protection of
investors require a suspension of trading
in the securities of True Product.
Therefore, it is ordered, pursuant to
Section 12(k) of the Securities Exchange
Act of 1934, that trading in the
securities of True Product is suspended
for the period from 9:30 a.m. EDT on
June 5, 2012, through 11:59 p.m. EDT on
June 18, 2012.
By the Commission.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2012–13932 Filed 6–5–12; 4:15 pm]
BILLING CODE 8011–01–P
June 5, 2012.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Future Now
Group, Inc. because it has not filed any
periodic reports since the period ended
March 31, 2010.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of Gammacan
International, Inc. because it has not
filed any periodic reports since the
period ended June 30, 2008.
The Commission is of the opinion that
the public interest and the protection of
investors require a suspension of trading
in the securities of the above-listed
companies.
Therefore, it is ordered, pursuant to
Section 12(k) of the Securities Exchange
Act of 1934, that trading in the
securities of the above-listed companies
is suspended for the period from 9:30
a.m. EDT on June 5, 2012, through 11:59
p.m. EDT on June 18, 2012.
By the Commission.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2012–13931 Filed 6–5–12; 4:15 pm]
BILLING CODE 8011–01–P
srobinson on DSK4SPTVN1PROD with NOTICES
True Product ID, Inc.; Order of
Suspension of Trading
June 5, 2012.
It appears to the Securities and
Exchange Commission that there is a
lack of current and accurate information
concerning the securities of True
Product ID, Inc. (‘‘True Product’’)
Jkt 226001
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Notice of Designation of a Longer
Period for Commission Action on
Proposed Rule Change To List and
Trade Option Contracts Overlying 10
Shares of a Security
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Kevin M. O’Neill,
Deputy Secretary.
June 1, 2012.
[FR Doc. 2012–13768 Filed 6–6–12; 8:45 am]
On April 9, 2012, the International
Securities Exchange, LLC (‘‘ISE’’) 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 list and trade option contracts
overlying 10 shares of a security. The
proposed rule change was published for
comment in the Federal Register on
April 24, 2012.3 The Commission
received four comment letters on the
proposal.4
Section 19(b)(2) of the Act 5 provides
that, within 45 days of the publication
of notice of the filing of a proposed rule
change, or within such longer period up
BILLING CODE 8011–01–P
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 66827
(April 18, 2012), 77 FR 24547.
4 See letters to Elizabeth M. Murphy, Secretary,
Commission, from Christopher Nagy, Managing
Director Order Routing & Market Data Strategy, TD
Ameritrade, Inc., dated April 30, 2012; Edward T.
Tilly, President and Chief Operating Officer,
Chicago Board Options Exchange, Incorporated,
dated April 30, 2012; Manisha Kimmel, Executive
Director, Financial Information Forum, dated April
30, 2012; and Joan Conley, Senior Vice President &
Corporate Secretary, The NASDAQ OMX Group,
Inc., dated April 30, 2012.
5 15 U.S.C. 78s(b)(2).
2 17
[File No. 500–1]
17:48 Jun 06, 2012
[Release No. 34–67097; File No. SR–ISE–
2012–26]
1 15
SECURITIES AND EXCHANGE
COMMISSION
VerDate Mar<15>2010
SECURITIES AND EXCHANGE
COMMISSION
to 90 days as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or as to which the
self-regulatory organization consents,
the Commission shall either approve the
proposed rule change, disapprove the
proposed rule change, or institute
proceedings to determine whether the
proposed rule change should be
disapproved. The 45th day for this filing
is June 8, 2012. The Commission is
extending this 45-day time period.
The Commission finds that it is
appropriate to designate a longer period
within which to take action on the
proposed rule change so that it has
sufficient time to consider the proposed
rule change, the comment letters
received, and any response to the
comment letters submitted by ISE.
Accordingly, the Commission,
pursuant to Section 19(b)(2) of the Act,6
designates July 23, 2012 as the date by
which the Commission should either
approve or disapprove, or institute
proceedings to determine whether to
disapprove, the proposed rule change
(File No. SR–ISE–2012–26).
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67095; File No. SR–OCC–
2012–08]
Self-Regulatory Organizations; The
Options Clearing Corporation; Notice
of Filing of Proposed Rule Change
Relating to Amendments to Certain
Rules Applicable to Stock Futures
June 1, 2012.
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 May 24,
2012, The Options Clearing Corporation
(‘‘OCC’’) filed with the Securities and
Exchange Commission (‘‘Commission’’)
the proposed rule change as described
in Items I and II below, which Items
have been prepared primarily by OCC.
The Commission is publishing this
notice to solicit comments on the
6 15
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(31).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
7 17
E:\FR\FM\07JNN1.SGM
07JNN1
Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Notices
proposed rule change from interested
persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Several separate purposes underlie
the proposed rule change. First, the rule
change clarifies the applicability of
OCC’s rules to stock futures overlying
index-linked securities. Second, it
eliminates a de minimis exception
relating to adjustments to stock futures
overlying ETFs. Third, it makes a
technical change to the rules that permit
the acceleration of the maturity
(expiration) date of stock futures (stock
options) following an adjustment in
response to cash-out events.
srobinson on DSK4SPTVN1PROD with NOTICES
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
OCC 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 self-regulatory
organization has prepared summaries,
set forth in sections (A), (B), and (C)
below, of the most significant aspects of
such statements.3
(A) Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
The first purpose of this proposed
rule change is to clarify the applicability
of OCC’s By-Laws and Rules to security
futures on index-linked securities such
as exchange-traded notes, which are
currently traded on OneChicago, LLC.
Index-linked securities are nonconvertible debt of a major financial
institution that typically have a term of
at least one year but not greater than
thirty years and that provide for
payment at maturity based upon the
performance of an index or indexes of
equity securities or futures contracts,
one or more physical commodities,
currencies or debt securities, or a
combination of any of the foregoing.
Index-linked securities are traded on
national securities exchanges and,
although they are technically debt
securities, meet the definition of ‘‘NMS
stock’’ under Regulation NMS.4
3 The Commission has modified the text of the
summaries prepared by OCC.
4 ‘‘NMS stock’’ is defined in Rule 600(b)(47) of
Regulation NMS to mean ‘‘any NMS security other
than an option.’’ ‘‘NMS security’’ is defined in Rule
600(b)(46) to mean any security for which
VerDate Mar<15>2010
17:48 Jun 06, 2012
Jkt 226001
Furthermore, index-linked securities
traded on designated contract markets
meet the requirements of Commodity
Futures Trading Commission Regulation
41.21 for the underlying securities of
security futures products that are
eligible to be treated as a single security.
OneChicago therefore treats security
futures on index-linked securities as
security futures on single securities, or
‘‘single stock futures,’’ for listing and
trading purposes, and trading in them
will generally be governed by the same
rules that are applicable to other single
stock futures. OCC similarly treats
futures on index-linked securities as
single stock futures, and accordingly is
proposing to amend the definition of
‘‘stock future’’ in Article I of its By-Laws
to explicitly include index-linked
securities.5
In addition to amending the definition
of ‘‘stock future’’ to reference indexlinked securities, OCC is proposing to
amend Interpretation and Policy .05 to
Article XII, Section 3 of its By-Laws to
clarify that a call of an entire class of
index-linked securities will result in an
adjustment of security futures on indexlinked securities similar to the
adjustment that would be made to other
stock futures in the event of a cash
merger, but that a partial call will not
result in an adjustment. OCC is also
proposing to add Interpretation and
Policy .11 to Article XII, Section 3 of its
By-Laws to establish that interest
payments on index-linked securities
will generally be considered ‘‘ordinary
cash dividends or distributions’’ within
the meaning of paragraph (c) of Section
3. The proposed amendments parallel
amendments previously made to Article
VI, Section 11A of the By-Laws to
accommodate options on index-linked
securities.6
The second purpose of this proposed
rule change is to amend Interpretation
and Policy .08 to Article XII, Section 3,
which provides that OCC will ordinarily
adjust for capital gains distributions on
underlying ‘‘fund shares,’’ i.e., shares of
exchange-traded funds (‘‘ETFs’’) but
with a de minimis exception under
which no adjustment will be made in
respect of distributions of less than
transaction reports are collected and disseminated
under an effective national market system plan, and
because index-linked securities are exchange traded
they fall within this definition.
5 Article I of OCC’s By-Laws defines ‘‘indexlinked security’’ to mean ‘‘a debt security listed on
a national securities exchange, the payment upon
maturity of which is based in whole or in part upon
the performance of an index or indexes of equity
securities or futures contracts, one or more physical
commodities, currencies or debt securities, or a
combination of any of the foregoing.’’
6 Securities Exchange Act Release No. 34–60872
(October 23, 2009), 74 FR 55878 (October 29, 2009).
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33795
$.125 per fund share. (An equivalent de
minimis provision is contained in the
Interpretations and Policies to Article
VI, Section 11A, governing stock
options.) However, in the case of stock
futures, OneChicago, the only futures
exchange clearing through OCC that
currently trades such futures, has
requested that adjustments be made for
capital gains distributions in respect of
fund shares without exception in order
to permit the stock futures on ETFs to
more closely reflect the economic
characteristics of the ETFs’ underlying
stocks. This revision to the provision for
fund shares futures will establish
consistency with Interpretation and
Policy .01(b) to Article XII, Section 3
which also does not contain a de
minimis threshold for stock futures
adjusted for cash distributions.
Accordingly, OCC is proposing to
amend Interpretation and Policy .08 to
eliminate the de minimis exception.
Additionally, OCC proposes to make
a technical correction to Rule 1304,
which permits the acceleration of the
maturity date for stock futures adjusted
to require the delivery of cash, and Rule
807, which permits the acceleration of
the expiration date of stock options
adjusted to require the delivery of cash.
Rules 1304 and 807 contain language
that could be read to suggest that such
acceleration would occur only in the
event of a cash-out merger. However,
cash-outs also may occur as a result of
bankruptcies, ADS liquidations and
other events, and there is no reason to
limit such accelerations to cash-out
merger events. Accordingly, OCC
proposes to amend Rules 1304 and 807
to delete language that may be perceived
to limit OCC’s ability to accelerate a
maturity or expiration date to such
events. OCC is also proposing to delete
as obsolete a version of Rule 807 that
was effective before January 1, 2008,
and related language regarding the
effective date in what would now be the
only version of Rule 807.
OCC believes that the proposed
changes to OCC’s By-Laws are
consistent with the purposes and
requirements of Section 17A of the Act 7
and the rules and regulations
thereunder applicable to OCC because
they will promote the prompt and
accurate clearance and settlement of
securities transactions by clarifying that
security futures on index-linked
securities will be cleared and settled
subject to the same rules and procedures
that are used successfully by OCC to
clear and settle stock futures,
eliminating an unnecessary de minimis
threshold for adjusting stock futures on
7 15
E:\FR\FM\07JNN1.SGM
U.S.C. 78q–1.
07JNN1
33796
Federal Register / Vol. 77, No. 110 / Thursday, June 7, 2012 / Notices
ETFs, and clarifying OCC’s ability to
accelerate maturity dates of stock
futures or expiration dates of stock
options in events other than cash-out
merger events and eliminating obsolete
rules or references. The proposed rule
change is not inconsistent with any
rules of OCC, including any that are
proposed to be amended.
(B) Self-Regulatory Organization’s
Statement on Burden on Competition
OCC does not believe that the
proposed rule change would impose any
burden on competition.
(C) Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
Written comments relating to the
proposed rule change have not been
solicited or received. OCC will notify
the Commission of any written
comments received by OCC.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days (i) as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or (ii) as to which
the self-regulatory organization
consents, the Commission will:
(A) By order approve or disapprove
the proposed rule change or
(B) Institute proceedings to determine
whether the proposed rule change
should be disapproved.
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
number should be included on the
subject line if email 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 Web site viewing and
printing in the Commission’s Public
Reference Section, 100 F Street NE.,
Washington, DC 20549–1090, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing will also be available for
inspection and copying at the principal
office of OCC and on OCC’s Web site at
https://www.theocc.com/components/
docs/legal/rules_and_bylaws/sr_occ_12_
08.pdf. 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–OCC–2012–08 and should
be submitted on or before June 28, 2012.
(‘‘Phlx’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘SEC’’ or ‘‘Commission’’) the proposed
rule change as described in Items I and
II below, which Items have been
prepared by the Exchange. The
Exchange has designated the proposed
rule change as constituting a rule
change under Rule 19b–4(f)(6) under the
Act,3 which renders the proposal
effective upon filing with the
Commission. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
For the Commission by the Division of
Trading and Markets, pursuant to delegated
authority.8
Kevin M. O’Neill,
Deputy Secretary.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
[FR Doc. 2012–13767 Filed 6–6–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67094; File No. SR–Phlx–
2012–76]
srobinson on DSK4SPTVN1PROD with NOTICES
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
OCC–2012–08 on the subject line.
Self-Regulatory Organizations;
NASDAQ OMX PHLX LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Extend its
FLEX No Minimum Value Pilot Program
Paper Comments
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 May 30,
2012, NASDAQ OMX PHLX LLC
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–OCC–2012–08. This file
VerDate Mar<15>2010
17:48 Jun 06, 2012
Jkt 226001
June 1, 2012.
8 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00094
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is filing with the
Commission a proposal to amend Phlx
Rule 1079 (FLEX Index, Equity and
Currency Options) to extend a pilot
program that eliminates minimum value
sizes for FLEX index options and FLEX
equity options (together known as
‘‘FLEX Options’’).4
The Exchange requests that the
Commission waive the 30-day operative
delay period contained in Exchange Act
Rule 19b–4(f)(6)(iii).5
The text of the proposed rule change
is available on the Exchange’s Web site
at https://
nasdaqomxphlx.cchwallstreet.com/
NASDAQOMXPHLX/Filings/, at the
principal office of the Exchange, and at
the Commission’s Public Reference
Room.
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.
3 17
CFR 240.19b–4(f)(6).
addition to FLEX Options, FLEX currency
options are also traded on the Exchange. These
flexible index, equity, and currency options provide
investors the ability to customize basic option
features including size, expiration date, exercise
style, and certain exercise prices; and may have
expiration dates within five years. See Rule 1079.
FLEX currency options traded on the Exchange are
also known as FLEX World Currency Options
(‘‘WCO’’) or Foreign Currency Options (‘‘FCO’’).
The pilot program discussed herein does not
encompass FLEX currency options.
5 17 CFR 240.19b–4(f)(6)(iii).
4 In
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]]>Agencies
[Federal Register Volume 77, Number 110 (Thursday, June 7, 2012)]
[Notices]
[Pages 33794-33796]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-13767]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67095; File No. SR-OCC-2012-08]
Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing of Proposed Rule Change Relating to Amendments to
Certain Rules Applicable to Stock Futures
June 1, 2012.
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 May 24, 2012, The Options Clearing Corporation (``OCC'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II below, which Items have been
prepared primarily by OCC. The Commission is publishing this notice to
solicit comments on the
[[Page 33795]]
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
Several separate purposes underlie the proposed rule change. First,
the rule change clarifies the applicability of OCC's rules to stock
futures overlying index-linked securities. Second, it eliminates a de
minimis exception relating to adjustments to stock futures overlying
ETFs. Third, it makes a technical change to the rules that permit the
acceleration of the maturity (expiration) date of stock futures (stock
options) following an adjustment in response to cash-out events.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, OCC 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 self-regulatory organization has prepared summaries,
set forth in sections (A), (B), and (C) below, of the most significant
aspects of such statements.\3\
---------------------------------------------------------------------------
\3\ The Commission has modified the text of the summaries
prepared by OCC.
---------------------------------------------------------------------------
(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The first purpose of this proposed rule change is to clarify the
applicability of OCC's By-Laws and Rules to security futures on index-
linked securities such as exchange-traded notes, which are currently
traded on OneChicago, LLC. Index-linked securities are non-convertible
debt of a major financial institution that typically have a term of at
least one year but not greater than thirty years and that provide for
payment at maturity based upon the performance of an index or indexes
of equity securities or futures contracts, one or more physical
commodities, currencies or debt securities, or a combination of any of
the foregoing. Index-linked securities are traded on national
securities exchanges and, although they are technically debt
securities, meet the definition of ``NMS stock'' under Regulation
NMS.\4\ Furthermore, index-linked securities traded on designated
contract markets meet the requirements of Commodity Futures Trading
Commission Regulation 41.21 for the underlying securities of security
futures products that are eligible to be treated as a single security.
OneChicago therefore treats security futures on index-linked securities
as security futures on single securities, or ``single stock futures,''
for listing and trading purposes, and trading in them will generally be
governed by the same rules that are applicable to other single stock
futures. OCC similarly treats futures on index-linked securities as
single stock futures, and accordingly is proposing to amend the
definition of ``stock future'' in Article I of its By-Laws to
explicitly include index-linked securities.\5\
---------------------------------------------------------------------------
\4\ ``NMS stock'' is defined in Rule 600(b)(47) of Regulation
NMS to mean ``any NMS security other than an option.'' ``NMS
security'' is defined in Rule 600(b)(46) to mean any security for
which transaction reports are collected and disseminated under an
effective national market system plan, and because index-linked
securities are exchange traded they fall within this definition.
\5\ Article I of OCC's By-Laws defines ``index-linked security''
to mean ``a debt security listed on a national securities exchange,
the payment upon maturity of which is based in whole or in part upon
the performance of an index or indexes of equity securities or
futures contracts, one or more physical commodities, currencies or
debt securities, or a combination of any of the foregoing.''
---------------------------------------------------------------------------
In addition to amending the definition of ``stock future'' to
reference index-linked securities, OCC is proposing to amend
Interpretation and Policy .05 to Article XII, Section 3 of its By-Laws
to clarify that a call of an entire class of index-linked securities
will result in an adjustment of security futures on index-linked
securities similar to the adjustment that would be made to other stock
futures in the event of a cash merger, but that a partial call will not
result in an adjustment. OCC is also proposing to add Interpretation
and Policy .11 to Article XII, Section 3 of its By-Laws to establish
that interest payments on index-linked securities will generally be
considered ``ordinary cash dividends or distributions'' within the
meaning of paragraph (c) of Section 3. The proposed amendments parallel
amendments previously made to Article VI, Section 11A of the By-Laws to
accommodate options on index-linked securities.\6\
---------------------------------------------------------------------------
\6\ Securities Exchange Act Release No. 34-60872 (October 23,
2009), 74 FR 55878 (October 29, 2009).
---------------------------------------------------------------------------
The second purpose of this proposed rule change is to amend
Interpretation and Policy .08 to Article XII, Section 3, which provides
that OCC will ordinarily adjust for capital gains distributions on
underlying ``fund shares,'' i.e., shares of exchange-traded funds
(``ETFs'') but with a de minimis exception under which no adjustment
will be made in respect of distributions of less than $.125 per fund
share. (An equivalent de minimis provision is contained in the
Interpretations and Policies to Article VI, Section 11A, governing
stock options.) However, in the case of stock futures, OneChicago, the
only futures exchange clearing through OCC that currently trades such
futures, has requested that adjustments be made for capital gains
distributions in respect of fund shares without exception in order to
permit the stock futures on ETFs to more closely reflect the economic
characteristics of the ETFs' underlying stocks. This revision to the
provision for fund shares futures will establish consistency with
Interpretation and Policy .01(b) to Article XII, Section 3 which also
does not contain a de minimis threshold for stock futures adjusted for
cash distributions. Accordingly, OCC is proposing to amend
Interpretation and Policy .08 to eliminate the de minimis exception.
Additionally, OCC proposes to make a technical correction to Rule
1304, which permits the acceleration of the maturity date for stock
futures adjusted to require the delivery of cash, and Rule 807, which
permits the acceleration of the expiration date of stock options
adjusted to require the delivery of cash. Rules 1304 and 807 contain
language that could be read to suggest that such acceleration would
occur only in the event of a cash-out merger. However, cash-outs also
may occur as a result of bankruptcies, ADS liquidations and other
events, and there is no reason to limit such accelerations to cash-out
merger events. Accordingly, OCC proposes to amend Rules 1304 and 807 to
delete language that may be perceived to limit OCC's ability to
accelerate a maturity or expiration date to such events. OCC is also
proposing to delete as obsolete a version of Rule 807 that was
effective before January 1, 2008, and related language regarding the
effective date in what would now be the only version of Rule 807.
OCC believes that the proposed changes to OCC's By-Laws are
consistent with the purposes and requirements of Section 17A of the Act
\7\ and the rules and regulations thereunder applicable to OCC because
they will promote the prompt and accurate clearance and settlement of
securities transactions by clarifying that security futures on index-
linked securities will be cleared and settled subject to the same rules
and procedures that are used successfully by OCC to clear and settle
stock futures, eliminating an unnecessary de minimis threshold for
adjusting stock futures on
[[Page 33796]]
ETFs, and clarifying OCC's ability to accelerate maturity dates of
stock futures or expiration dates of stock options in events other than
cash-out merger events and eliminating obsolete rules or references.
The proposed rule change is not inconsistent with any rules of OCC,
including any that are proposed to be amended.
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\7\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition
OCC does not believe that the proposed rule change would impose any
burden on competition.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants or Others
Written comments relating to the proposed rule change have not been
solicited or received. OCC will notify the Commission of any written
comments received by OCC.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve or disapprove the proposed rule change or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
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 email to rule-comments@sec.gov. Please include
File Number SR-OCC-2012-08 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-OCC-2012-08. This file
number should be included on the subject line if email 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 Web site viewing and
printing in the Commission's Public Reference Section, 100 F Street
NE., Washington, DC 20549-1090, on official business days between the
hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also be
available for inspection and copying at the principal office of OCC and
on OCC's Web site at https://www.theocc.com/components/docs/legal/rules_and_bylaws/sr_occ_12_08.pdf. 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-OCC-2012-08 and should be submitted on
or before June 28, 2012.
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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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-13767 Filed 6-6-12; 8:45 am]
BILLING CODE 8011-01-P
