
[Federal Register Volume 76, Number 147 (Monday, August 1, 2011)]
[Notices]
[Pages 45885-45895]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-19329]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64967; File No. SR-NYSEArca-2011-48]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
of Proposed Rule Change To List and Trade Shares of the Teucrium Wheat 
Fund, the Teucrium Soybean Fund and the Teucrium Sugar Fund Under NYSE 
Arca Equities Rule 8.200, Commentary .02

July 26, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that, on July 11, 2011, NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the Exchange. The Commission 
is publishing this notice to solicit comments on the proposed rule 
change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the Teucrium 
Wheat Fund, the Teucrium Soybean Fund and the Teucrium Sugar Fund under 
NYSE Arca Equities Rule 8.200. The text of the proposed rule change is 
available on the Exchange's Web site at http://www.nyse.com, at the 
Exchange's principal office and at the Commission's Public Reference 
Room.

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 self-regulatory organization 
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 those 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 parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    NYSE Arca Equities Rule 8.200, Commentary .02 permits the trading 
of Trust Issued Receipts (``TIRs'') either by listing or pursuant to 
unlisted trading privileges (``UTP'').\3\ The Exchange proposes to list 
and trade shares (``Shares'') of the Teucrium Wheat Fund, the Teucrium 
Soybean Fund and the Teucrium Sugar Fund (each a

[[Page 45886]]

``Fund'' and, collectively, the ``Funds'') pursuant to NYSE Arca 
Equities Rule 8.200.
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    \3\ Commentary .02 to NYSE Arca Equities Rule 8.200 applies to 
TIRs that invest in ``Financial Instruments.'' The term ``Financial 
Instruments,'' as defined in Commentary .02(b)(4) to NYSE Arca 
Equities Rule 8.200, means any combination of investments, including 
cash; securities; options on securities and indices; futures 
contracts; options on futures contracts; forward contracts; equity 
caps, collars and floors; and swap agreements.
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    The Exchange notes that the Commission has previously approved the 
listing and trading of other issues of TIRs on the American Stock 
Exchange LLC,\4\ trading on NYSE Arca pursuant to UTP,\5\ and listing 
on NYSE Arca.\6\ Among these is the Teucrium Corn Fund, a series of the 
Teucrium Commodity Trust (``Trust'').\7\ In addition, the Commission 
has approved the listing and trading of other exchange-traded fund-like 
products linked to the performance of underlying commodities.\8\
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    \4\ See, e.g., Securities Exchange Act Release No. 58161 (July 
15, 2008), 73 FR 42380 (July 21, 2008) (SR-Amex-2008-39).
    \5\ See, e.g., Securities Exchange Act Release No. 58163 (July 
15, 2008), 73 FR 42391 (July 21, 2008) (SR-NYSEArca-2008-73).
    \6\ See, e.g., Securities Exchange Act Release No. 58457 
(September 3, 2008), 73 FR 52711 (September 10, 2008) (SR-NYSEArca-
2008-91).
    \7\ See Securities Exchange Act Release No. 62213 (June 3, 
2010), 75 FR 32828 (June 9, 2010) (SR-NYSEArca-2010-22) (order 
approving listing on the Exchange of Teucrium Corn Fund).
    \8\ See, e.g., Securities Exchange Act Release Nos. 57456 (March 
7, 2008), 73 FR 13599 (March 13, 2008) (SR-NYSEArca-2007-91) (order 
granting accelerated approval for NYSE Arca listing the iShares GS 
Commodity Trusts); 59781 (April 17, 2009), 74 FR 18771 (April 24, 
2009) (SR-NYSEArca-2009-28) (order granting accelerated approval for 
NYSE Arca listing the ETFS Silver Trust); 59895 (May 8, 2009), 74 FR 
22993 (May 15, 2009) (SR-NYSEArca-2009-40) (order granting 
accelerated approval for NYSE Arca listing the ETFS Gold Trust); 
61219 (December 22, 2009), 74 FR 68886 (December 29, 2009) (SR-
NYSEArca-2009-95) (order approving listing on NYSE Arca of the ETFS 
Platinum Trust).
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    The Shares represent beneficial ownership interests in the Funds, 
as described in the Registration Statements for the Funds.\9\ The Funds 
are commodity pools that are series of the Trust, a Delaware statutory 
trust. The Funds are managed and controlled by Teucrium Trading, LLC 
(``Sponsor''). The Sponsor is a Delaware limited liability company that 
is registered as a commodity pool operator (``CPO'') with the Commodity 
Futures Trading Commission (``CFTC'') and is a member of the National 
Futures Association.
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    \9\ See Amendment No. 3 to Form S-1 for Teucrium Commodity 
Trust, dated June 3, 2011 (File No. 333-167591) relating to the 
Teucrium Wheat Fund; Amendment No. 3 to Form S-1 for Teucrium 
Commodity Trust, dated June 3, 2011 (File No. 333-167590) relating 
to the Teucrium Soybean Fund; and Amendment No. 3 to Form S-1 for 
Teucrium Commodity Trust, dated June 3, 2011 (File No. 333-167585) 
relating to the Teucrium Sugar Fund (each, a ``Registration 
Statement,'' and, collectively, the ``Registration Statements''). 
The discussion herein relating to the Trust and the Shares is based, 
in part, on the Registration Statements.
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Teucrium Wheat Fund
    According to the Registration Statement, the investment objective 
of the Fund is to have the daily changes in percentage terms of the 
Shares' net asset value (``NAV'') reflect the daily changes in 
percentage terms of a weighted average of the closing settlement prices 
for three futures contracts for wheat (wheat futures contracts 
generally referred to herein as ``Wheat Futures Contracts'') that are 
traded on the Chicago Board of Trade (``CBOT''), specifically: (1) The 
second-to-expire CBOT Wheat Futures Contract, weighted 35%, (2) the 
third-to-expire CBOT Wheat Futures Contract, weighted 30%, and (3) the 
CBOT Wheat Futures Contract expiring in the December following the 
expiration month of the third-to-expire contract, weighted 35%. (This 
weighted average of the three referenced Wheat Futures Contracts is 
referred to herein as the ``Wheat Benchmark,'' and the three Wheat 
Futures Contracts that at any given time make up the Wheat Benchmark 
are referred to herein as the ``Wheat Benchmark Component Futures 
Contracts'').\10\
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    \10\ Wheat futures volume on CBOT for 2010 and 2011 (through 
April 29, 2011) was 23,058,783 contracts and 8,860,135 contracts, 
respectively. As of April 29, 2011, open interest for wheat futures 
was 456,851 contracts. The contract price was $40,062.50 (801.25 
cents per bushel and 5,000 bushels per contract). The approximate 
value of all outstanding contracts was $18.3 billion. The position 
limits for all months is 6,500 contracts and the total value of 
contracts if position limits were reached would be approximately 
$260.4 million (based on the $40,062.50 contract price).
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    The Fund seeks to achieve its investment objective by investing 
under normal market conditions \11\ in Wheat Benchmark Component 
Futures Contracts or, in certain circumstances, in other Wheat Futures 
Contracts traded on the CBOT, the Kansas City Board of Trade 
(``KCBT''), or the Minneapolis Grain Exchange (``MGEX''), or Wheat 
Futures Contracts traded on foreign exchanges. In addition, and to a 
limited extent, the Fund also may invest in exchange-traded options on 
Wheat Futures Contracts, and in wheat-based swap agreements that are 
cleared through the CBOT or its affiliated provider of clearing 
services (``Cleared Wheat Swaps'') in furtherance of the Fund's 
investment objective.\12\
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    \11\ The term ``under normal market conditions'' includes, but 
is not limited to, the absence of extreme volatility or trading 
halts in the fixed income markets or the financial markets 
generally; operational issues causing dissemination of inaccurate 
market information; or force majeure type events such as systems 
failure, natural or man-made disaster, act of God, armed conflict, 
act of terrorism, riot or labor disruption or any similar 
intervening circumstance.
    \12\ According to the Registration Statement, a swap agreement 
is a bilateral contract to exchange a periodic stream of payments 
determined by reference to a notional amount, with payment typically 
made between the parties on a net basis. For example, in the case of 
a wheat swap, the Fund may be obligated to pay a fixed price per 
bushel of wheat and be entitled to receive an amount per bushel 
equal to the current value of an index of wheat prices, the price of 
a specified Wheat Futures Contract, or the average price of a group 
of Wheat Futures Contracts such as the Wheat Benchmark.
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    Specifically, once position limits in CBOT Wheat Futures Contracts 
are reached, the Fund's intention is to invest first in Cleared Wheat 
Swaps to the extent permitted under the position limits applicable to 
Cleared Wheat Swaps and appropriate in light of the liquidity in the 
Cleared Wheat Swaps market, and then, using its commercially reasonable 
judgment, in other Wheat Futures Contracts (i.e., Wheat Futures 
Contracts traded on KCBT, MGEX or traded on foreign exchanges) or 
instruments such as cash-settled options on Wheat Futures Contracts and 
forward contracts, swaps other than Cleared Wheat Swaps, and other 
over-the-counter transactions that are based on the price of wheat and 
Wheat Futures Contracts (collectively, ``Other Wheat Interests,'' and 
together with Wheat Futures Contracts and Cleared Wheat Swaps, ``Wheat 
Interests''). By utilizing certain or all of these investments, the 
Sponsor will endeavor to cause the Fund's performance to closely track 
that of the Wheat Benchmark. The circumstances under which such 
investments in Other Wheat Interests may be utilized (e.g., imposition 
of position limits) are discussed below.
    Wheat Futures Contracts traded on the CBOT expire on a specified 
day in five different months: March, May, July, September and December. 
For example, in terms of the Wheat Benchmark, in June of a given year 
the next-to-expire or ``spot month'' Wheat Futures Contract will expire 
in July of that year, and the Wheat Benchmark Component Futures 
Contracts will be the contracts expiring in September of that year (the 
second-to-expire contract), December of that year (the third-to-expire 
contract), and December of the following year. As another example, in 
November of a given year, the Wheat Benchmark Component Futures 
Contracts will be the contracts expiring in March, May and December of 
the following year.
    According to the Registration Statement, the Fund seeks to achieve 
its investment objective primarily by investing in Wheat Interests such 
that daily changes in the Fund's NAV will be

[[Page 45887]]

expected to closely track the changes in the Wheat Benchmark. The 
Fund's positions in Wheat Interests will be changed or ``rolled'' on a 
regular basis in order to track the changing nature of the Wheat 
Benchmark. For example, five times a year (on the date on which a Wheat 
Futures Contract expires), the second-to-expire Wheat Futures Contract 
will become the next-to-expire Wheat Futures Contract and will no 
longer be a Wheat Benchmark Component Futures Contract, and the Fund's 
investments will have to be changed accordingly.\13\
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    \13\ For each of the Funds, in order that the Fund's trading 
does not cause unwanted market movements and to make it more 
difficult for third parties to profit by trading based on such 
expected market movements, the Fund's investments typically will not 
be rolled entirely on that day, but rather will typically be rolled 
over a period of several days.
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    Consistent with achieving the Fund's investment objective of 
closely tracking the Wheat Benchmark, the Sponsor may for certain 
reasons cause the Fund to enter into or hold Cleared Wheat Swaps and/or 
Other Wheat Interests. For example, certain Cleared Wheat Swaps have 
standardized terms similar to, and are priced by reference to, a 
corresponding Wheat Benchmark Component Futures Contract. Additionally, 
Other Wheat Interests that do not have standardized terms and are not 
exchange-traded (``over-the-counter'' Wheat Interests), can generally 
be structured as the parties desire. Therefore, the Fund might enter 
into multiple Cleared Wheat Swaps and/or over-the-counter Wheat 
Interests intended to exactly replicate the performance of each of the 
three Wheat Benchmark Component Futures Contracts, or a single over-
the-counter Wheat Interest designed to replicate the performance of the 
Wheat Benchmark as a whole. According to the Registration Statement, 
assuming that there is no default by a counterparty to an over-the-
counter Wheat Interest, the performance of the over-the-counter Wheat 
Interest will necessarily correlate exactly with the performance of the 
Wheat Benchmark or the applicable Wheat Benchmark Component Futures 
Contract.\14\ The Fund might also enter into or hold over-the-counter 
Wheat Interests to facilitate effective trading, consistent with the 
discussion of the Fund's ``roll'' strategy in the preceding paragraph. 
In addition, the Fund might enter into or hold over-the-counter Wheat 
Interests that would be expected to alleviate overall deviation between 
the Fund's performance and that of the Wheat Benchmark that may result 
from certain market and trading inefficiencies or other reasons.
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    \14\ According to the Registration Statements, the Funds face 
the risk of non-performance by the counterparties to over-the-
counter contracts. Unlike in futures contracts, the counterparty to 
these contracts is generally a single bank or other financial 
institution, rather than a clearing organization backed by a group 
of financial institutions. As a result, there will be greater 
counterparty credit risk in these transactions. The creditworthiness 
of each potential counterparty will be assessed by the Sponsor. The 
Sponsor will assess or review, as appropriate, the creditworthiness 
of each potential or existing counterparty to an over-the-counter 
contract pursuant to guidelines approved by the Sponsor. The 
creditworthiness of existing counterparties will be reviewed 
periodically by the Sponsor.
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    The Fund will invest in Wheat Interests to the fullest extent 
possible without being leveraged or unable to satisfy its expected 
current or potential margin or collateral obligations with respect to 
its investments in Wheat Interests.\15\ After fulfilling such margin 
and collateral requirements, the Fund will invest the remainder of its 
proceeds from the sale of baskets in obligations of the United States 
government (``Treasury Securities'') or cash equivalents, and/or hold 
such assets in cash (generally in interest-bearing accounts). 
Therefore, the focus of the Sponsor in managing the Fund is investing 
in Wheat Interests and in Treasury Securities, cash and/or cash 
equivalents. Each of the Funds will earn interest income from the 
Treasury Securities and/or cash equivalents that it purchases and on 
the cash it holds through each Fund's custodian, the Bank of New York 
Mellon (the ``Custodian'' and the ``Administrator'').
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    \15\ The Sponsor represents that the Fund will invest in Wheat 
Interests in a manner consistent with the Fund's investment 
objective and not to achieve additional leverage.
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    The Sponsor endeavors to place the Fund's trades in Wheat Interests 
and otherwise manage the Fund's investments so that the Fund's average 
daily tracking error against the Wheat Benchmark will be less than 10 
percent over any period of 30 trading days. More specifically, the 
Sponsor will endeavor to manage the Fund so that A will be within plus/
minus 10 percent of B, where A is the average daily change in the 
Fund's NAV for any period of 30 successive valuation days, i.e., any 
trading day as of which the Fund calculates its NAV, and B is the 
average daily change in the Wheat Benchmark over the same period.\16\
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    \16\ For each of the Funds, the Sponsor believes that market 
arbitrage opportunities will cause each Fund's respective Share 
price on the NYSE Arca to closely track the Fund's NAV per Share. 
The Sponsor believes that the net effect of this expected 
relationship and the expected relationship described above between 
the Fund's respective NAV and the respective benchmark will be that 
the changes in the price of the Fund's Shares on the NYSE Arca will 
closely track, in percentage terms, changes in such benchmark, less 
expenses.
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    According to the Registration Statement, the Sponsor employs a 
``neutral'' investment strategy intended to track the changes in the 
Wheat Benchmark regardless of whether the Wheat Benchmark goes up or 
goes down. The Fund's ``neutral'' investment strategy is designed to 
permit investors generally to purchase and sell the Fund's Shares for 
the purpose of investing indirectly in the wheat market in a cost-
effective manner. Such investors may include participants in the wheat 
industry and other industries seeking to hedge the risk of losses in 
their wheat-related transactions, as well as investors seeking exposure 
to the wheat market. The Sponsor does not intend to operate the Fund in 
a fashion such that its per Share NAV will equal, in dollar terms, the 
spot price of a bushel or other unit of wheat or the price of any 
particular Wheat Futures Contract.
    According to the Registration Statement, the CFTC and U.S. 
designated contract markets such as the CBOT may establish position 
limits on the maximum net long or net short futures contracts in 
commodity interests that any person or group of persons under common 
trading control (other than as a hedge) may hold, own or control.\17\ 
For example, the current position limit for investments at any one time 
in CBOT Wheat Futures Contracts are 600 spot month contracts, 5,000 
contracts expiring in any other single month, and 6,500 contracts total 
for all months. Cleared Wheat Swaps are subject to position limits that 
are substantially identical to, but measured separately from, the 
limits on Wheat Futures Contracts. Position limits are fixed ceilings 
that the Fund would not be able to exceed without specific exchange 
authorization. Under current law, all Wheat Futures Contracts traded on 
a particular exchange that are held under the control of the Sponsor, 
including those held by any future series of the Trust, are aggregated 
in determining the application of applicable position limits.
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    \17\ According to the Registration Statement, position limits 
generally impose a fixed ceiling on aggregate holdings in futures 
contracts relating to a particular commodity, and may also impose 
separate ceilings on contracts expiring in any one month, contracts 
expiring in the spot month, and/or contracts in certain specified 
final days of trading.
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    In addition to position limits, the exchanges may establish daily 
price fluctuation limits on futures contracts. The daily price 
fluctuation limit establishes the maximum amount that

[[Page 45888]]

the price of futures contracts may vary either up or down from the 
previous day's settlement price. Once the daily price fluctuation limit 
has been reached in a particular futures contract, no trades may be 
made at a price beyond that limit.\18\ Position limits, accountability 
levels, and daily price fluctuation limits set by the exchanges have 
the potential to cause tracking error, which could cause the price of 
Shares to substantially vary from the Wheat Benchmark and prevent an 
investor from being able to effectively use the Fund as a way to hedge 
against wheat-related losses or as a way to indirectly invest in wheat.
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    \18\ For example, the CBOT imposes a $3,000 per contract price 
fluctuation limit for Wheat Futures Contracts. This limit is 
initially based off of the previous trading day's settlement price. 
If two or more Wheat Futures Contract months within the first five 
listed non-spot contracts close at the limit, the daily price limit 
increases to $4,500 per contract for the next business day and to 
$6,750 for the next business day.
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    The Fund does not intend to limit the size of the offering and will 
attempt to expose substantially all of its proceeds to the wheat market 
utilizing Wheat Interests. If the Fund encounters position limits, 
accountability levels, or price fluctuation limits for Wheat Futures 
Contracts and/or Cleared Wheat Swaps on the CBOT, it may then, if 
permitted under applicable regulatory requirements, purchase Other 
Wheat Interests and/or Wheat Futures Contracts listed on other domestic 
or foreign exchanges. However, the Wheat Futures Contracts available on 
such foreign exchanges may have different underlying sizes, deliveries, 
and prices. In addition, the Wheat Futures Contracts available on these 
exchanges may be subject to their own position limits and 
accountability levels. In any case, notwithstanding the potential 
availability of these instruments in certain circumstances, position 
limits could force the Fund to limit the number of Creation Baskets (as 
defined below) that it sells.\19\
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    \19\ With respect to each of the Funds, there will be no 
specified limit on the maximum amount of Creation Baskets that can 
be sold. At some point, however, applicable position limits may 
practically limit the number of Creation Baskets that will be sold 
if the Sponsor determines that the other investment alternatives 
available to a Fund at that time will not enable it to meet its 
stated investment objective.
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Teucrium Soybean Fund
    According to the Registration Statement, the investment objective 
of the Fund is to have the daily changes in percentage terms of the 
Shares' NAV reflect the daily changes in percentage terms of a weighted 
average of the closing settlement prices for three futures contracts 
for soybeans (soybean futures contracts generally referred to herein as 
``Soybean Futures Contracts'') that are traded on the CBOT. Except as 
described in the following paragraph, the three Soybean Futures 
Contracts will be: (1) Second-to-expire CBOT Soybean Futures Contract, 
weighted 35%, (2) the third-to-expire CBOT Soybean Futures Contract, 
weighted 30%, and (3) the CBOT Soybean Futures Contract expiring in the 
November following the expiration month of the third-to-expire 
contract, weighted 35%. The weighted average of the three Soybean 
Futures Contracts is referred to herein as the ``Soybean Benchmark,'' 
and the three Soybean Futures Contracts that at any given time make up 
the Soybean Benchmark are referred to herein as the ``Soybean Benchmark 
Component Futures Contracts.'' The circumstances under which such 
investments in Other Soybean Interests may be utilized (e.g., 
imposition of position limits) are discussed below.\20\
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    \20\ Soybean futures volume on CBOT for 2010 and 2011 (through 
April 29, 2011) was 36,962,868 contracts and 16,197,385 contracts, 
respectively. As of April 29, 2011, open interest for soybean 
futures was 572,959 contracts. The contract price was $69,700.00 
(1394 cents per bushel and 5,000 bushels per contract). The 
approximate value of all outstanding contracts was $39.9 billion. 
The position limits for all months is 6,500 contracts and the total 
value of contracts if position limits were reached would be 
approximately $453 million (based on the $69,700.00 contract price).
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    Soybean Futures Contracts traded on the CBOT expire on a specified 
day in seven different months: January, March, May, July, August, 
September and November. However, there is generally a less liquid 
market for the Soybean Futures Contracts expiring in August (the 
``August Contract'') and September (the ``September Contract'' and, 
together with the August Contract, the ``Excluded Contracts''), and the 
Sponsor has determined not to incorporate the Excluded Contracts into 
the Soybean Benchmark calculation. Accordingly, during the period when 
the Excluded Contracts are the second-to-expire and third-to-expire 
Soybean Futures Contract, the fourth-to-expire and fifth-to-expire 
Soybean Futures Contracts will take the place of the second-to-expire 
and third-to-expire Soybean Futures Contracts, respectively, as Soybean 
Benchmark Component Futures Contracts. Similarly, when the August 
Contract is the third-to-expire Soybean Futures Contract, the fifth-to-
expire Soybean Futures Contract will take the place of the August 
Contract as a Soybean Benchmark Component Futures Contract, and when 
the September Contract is the second-to-expire Soybean Futures 
Contract, the third-to-expire and fourth-to-expire Soybean Futures 
Contracts will be Soybean Benchmark Component Futures Contracts.\21\
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    \21\ See the Registration Statement for additional information 
regarding specific Soybean Futures Contracts that will be used in 
the calculation of the Soybean Benchmark at any point in a given 
year, based on the same 35%/30%/35% weighting methodology described 
above.
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    According to the Registration Statement, the Fund seeks to achieve 
its investment objective by investing under normal market conditions in 
Soybean Benchmark Component Futures Contracts or, in certain 
circumstances, in other Soybean Futures Contracts traded on CBOT or 
Soybean Futures Contracts traded on foreign exchanges. In addition, and 
to a limited extent, the Fund also may invest in exchange-traded 
options on Soybean Futures Contracts and in soybean-based swap 
agreements that are cleared through the CBOT or its affiliated provider 
of clearing services (``Cleared Soybean Swaps'') in furtherance of the 
Fund's investment objective.
    Specifically, once CBOT position limits in Soybean Futures 
Contracts are reached, the Fund's intention is to invest first in 
Cleared Soybean Swaps to the extent permitted under the CBOT position 
limits applicable to Cleared Soybean Swaps and appropriate in light of 
the liquidity in the Cleared Soybean Swaps market, and then, using its 
commercially reasonable judgment, in other Soybean Futures Contracts 
(i.e., Soybean Futures Contracts traded on foreign exchanges) and 
instruments such as cash-settled options on Soybean Futures Contracts 
and forward contracts, swaps other than Cleared Soybean Swaps, and 
other over-the-counter transactions that are based on the price of 
soybeans and Soybean Futures Contracts (collectively, ``Other Soybean 
Interests,'' and together with Soybean Futures Contracts and Cleared 
Soybean Swaps, ``Soybean Interests'').
    The Fund seeks to achieve its investment objective primarily by 
investing in Soybean Interests such that daily changes in the Fund's 
NAV will be expected to closely track the changes in the Soybean 
Benchmark. The Fund's positions in Soybean Interests will be changed or 
``rolled'' on a regular basis in order to track the changing nature of 
the Soybean Benchmark. For example, five times a year (on the date on 
which certain Soybean Futures Contracts expire), a particular Soybean 
Futures Contract will no longer be a Soybean Benchmark Component 
Futures Contract, and the Fund's investments will have to be changed 
accordingly.

[[Page 45889]]

    According to the Registration Statement, consistent with achieving 
the Fund's investment objective of closely tracking the Soybean 
Benchmark, the Sponsor may for certain reasons cause the Fund to enter 
into or hold Cleared Soybean Swaps and/or Other Soybean Interests. For 
example, certain Cleared Soybean Swaps have standardized terms similar 
to, and are priced by reference to, a corresponding Soybean Benchmark 
Component Futures Contract. Additionally, Other Soybean Interests that 
do not have standardized terms and are not exchange-traded (``over-the-
counter'' Soybean Interests) can generally be structured as the parties 
desire. Therefore, the Fund might enter into multiple Cleared Soybean 
Swaps and/or over-the-counter Soybean Interests intended to exactly 
replicate the performance of each of the three Soybean Benchmark 
Component Futures Contracts, or a single over-the-counter Soybean 
Interest designed to replicate the performance of the Soybean Benchmark 
as a whole. According to the Registration Statement, assuming that 
there is no default by a counterparty to an over-the-counter Soybean 
Interest, the performance of the over-the-counter Soybean Interest will 
necessarily correlate exactly with the performance of the Soybean 
Benchmark or the applicable Soybean Benchmark Component Futures 
Contract. The Fund might also enter into or hold over-the-counter 
Soybean Interests to facilitate effective trading, consistent with the 
discussion of the Fund's ``roll'' strategy in the preceding paragraph. 
In addition, the Fund might enter into or hold over-the-counter Soybean 
Interests that would be expected to alleviate overall deviation between 
the Fund's performance and that of the Soybean Benchmark that may 
result from certain market and trading inefficiencies or other reasons.
    The Fund will invest in Soybean Interests to the fullest extent 
possible without being leveraged or unable to satisfy its expected 
current or potential margin or collateral obligations with respect to 
its investments in Soybean Interests.\22\ After fulfilling such margin 
and collateral requirements, the Fund will invest the remainder of its 
proceeds from the sale of baskets in Treasury Securities or cash 
equivalents, and/or hold such assets in cash (generally in interest-
bearing accounts). Therefore, the focus of the Sponsor in managing the 
Fund is investing in Soybean Interests and in Treasury Securities, cash 
and/or cash equivalents.
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    \22\ The Sponsor represents that the Fund will invest in Soybean 
Interests in a manner consistent with the Fund's investment 
objective and not to achieve additional leverage.
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    The Sponsor endeavors to place the Fund's trades in Soybean 
Interests and otherwise manage the Fund's investments so that the 
Fund's average daily tracking error against the Soybean Benchmark will 
be less than 10 percent over any period of 30 trading days. More 
specifically, the Sponsor will endeavor to manage the Fund so that A 
will be within plus/minus 10 percent of B, where A is the average daily 
change in the Fund's NAV for any period of 30 successive valuation 
days, i.e., any trading day as of which the Fund calculates its NAV, 
and B is the average daily change in the Soybean Benchmark over the 
same period.
    The Sponsor employs a ``neutral'' investment strategy intended to 
track the changes in the Soybean Benchmark regardless of whether the 
Soybean Benchmark goes up or goes down. The Fund's ``neutral'' 
investment strategy is designed to permit investors generally to 
purchase and sell the Fund's Shares for the purpose of investing 
indirectly in the soybean market in a cost-effective manner. Such 
investors may include participants in the soybean industry and other 
industries seeking to hedge the risk of losses in their soybean-related 
transactions, as well as investors seeking exposure to the soybean 
market. The Sponsor does not intend to operate the Fund in a fashion 
such that its per Share NAV will equal, in dollar terms, the spot price 
of a bushel or other unit of soybean or the price of any particular 
Soybean Futures Contract.
    The CFTC's position limits for Soybean Futures Contracts (including 
related options) are 600 spot month contracts, 6,500 contracts expiring 
in any other single month, and 10,000 contracts for all months. 
Position limits could in certain circumstances effectively limit the 
number of Creation Baskets that the Fund can sell but, because the Fund 
is new, it is not expected to reach asset levels that would cause these 
position limits to be implicated in the near future. Cleared Soybean 
Swaps are subject to position limits that are substantially identical 
to, but measured separately from, the positions limits applicable to 
Soybean Futures Contracts. Under current law, all Soybean Futures 
Contracts that are held under the control of the Sponsor, including 
those held by any future series of the Trust, are aggregated in 
determining the application of applicable position limits.
    According to the Registration Statement, in contrast to position 
limits, accountability levels are not fixed ceilings, but rather 
thresholds above which an exchange may exercise greater scrutiny and 
control over an investor, including by imposing position limits on the 
investor. In light of the position limits discussed above, the CBOT has 
not set any accountability levels for Soybean Futures Contracts.
    According to the Registration Statement, the CBOT imposes a $0.70 
per bushel ($3,500 per contract) daily price fluctuation limit for 
Soybean Futures Contracts. Once the daily price fluctuation limit has 
been reached in a particular Soybean Futures Contract, no trades may be 
made at a price beyond that limit. If two or more Soybean Futures 
Contract months within the first seven listed non-spot contracts close 
at the limit, the daily price limit increases to $1.05 per bushel 
($5,250 per contract) the next business day and to $1.60 per bushel 
($8,000 per contract) the next business day. These limits are based off 
the previous trading day's settlement price. Position limits and daily 
price fluctuation limits set by the CFTC and the exchanges have the 
potential to cause tracking error, which could cause the price of 
Shares to substantially vary from the Soybean Benchmark and prevent an 
investor from being able to effectively use the Fund as a way to hedge 
against soybean-related losses or as a way to indirectly invest in 
soybeans.
    The Fund does not intend to limit the size of the offering and will 
attempt to expose substantially all of its proceeds to the soybean 
market utilizing Soybean Interests. If the Fund encounters position 
limits or price fluctuation limits for Soybean Futures Contracts and/or 
Cleared Soybean Swaps on the CBOT, it may then, if permitted under 
applicable regulatory requirements, purchase Other Soybean Interests 
and/or Soybean Futures Contracts listed on foreign exchanges. However, 
the Soybean Futures Contracts available on such foreign exchanges may 
have different underlying sizes, deliveries, and prices. In addition, 
the Soybean Futures Contracts available on these exchanges may be 
subject to their own position limits or similar restrictions. In any 
case, notwithstanding the potential availability of these instruments 
in certain circumstances, position limits could force the Fund to limit 
the number of Creation Baskets (as defined below) that it sells.\23\
---------------------------------------------------------------------------

    \23\ See note 19, supra.
---------------------------------------------------------------------------

Teucrium Sugar Fund
    According to the Registration Statement, the investment objective 
of the Fund is to have the daily changes in percentage terms of the 
Shares' NAV

[[Page 45890]]

reflect the daily changes in percentage terms of a weighted average of 
the closing settlement prices for three futures contracts for sugar 
(sugar futures contracts generally referred to herein as ``Sugar 
Futures Contracts'') that are traded on ICE Futures US (``ICE 
Futures''), specifically: (1) The second-to-expire Sugar No. 11 Futures 
Contract (a ``Sugar No. 11 Futures Contract''), weighted 35%, (2) the 
third-to-expire Sugar No. 11 Futures Contract, weighted 30%, and (3) 
the Sugar No. 11 Futures Contract expiring in the March following the 
expiration month of the third-to-expire contract, weighted 35%. The 
weighted average of the three Sugar No. 11 Futures Contracts is 
referred to herein as the ``Sugar Benchmark,'' and the three Sugar No. 
11 Futures Contracts that at any given time make up the Sugar Benchmark 
are referred to herein as the ``Sugar Benchmark Component Futures 
Contracts.'' \24\
---------------------------------------------------------------------------

    \24\ Sugar futures volume on ICE Futures for 2010 and 2011 
(through April 29, 2011) was 27,848,391 contracts and 9,045,069 
contracts, respectively. As of April 29, 2011, open interest for 
sugar futures was 570,948 contracts. The contract price was 
$24,920.00 (22.25 cents per pound and 112,000 pounds per contract). 
The approximate value of all outstanding contracts was $14.2 
billion. The position limits for all months is 15,000 contracts and 
the total value of contracts if position limits were reached would 
be approximately $373.8 million (based on the $24,920.00 contract 
price).
---------------------------------------------------------------------------

    The Fund seeks to achieve its investment objective by investing 
under normal market conditions in Sugar Benchmark Component Futures 
Contracts or, in certain circumstances, in other Sugar Futures 
Contracts traded on ICE Futures or the New York Mercantile Exchange 
(``NYMEX''), or Sugar Futures Contracts traded on foreign exchanges. In 
addition, and to a limited extent, the Fund also may invest in 
exchange-traded options on Sugar Futures Contracts and in sugar-based 
swap agreements that are cleared through ICE Futures or its affiliated 
provider of clearing services (``Cleared Sugar Swaps'') in furtherance 
of the Fund's investment objective.
    Specifically, once accountability levels in Sugar No. 11 Futures 
Contracts traded on ICE Futures are reached, the Fund's intention is to 
invest first in Cleared Sugar Swaps to the extent permitted under the 
accountability levels applicable to Cleared Sugar Swaps and appropriate 
in light of the liquidity in the Cleared Sugar Swaps market, and then, 
using its commercially reasonable judgment, in other Sugar Futures 
Contracts (i.e., Sugar Futures Contracts traded on the NYMEX or foreign 
exchanges) and instruments such as cash-settled options on Sugar 
Futures Contracts and forward contracts, swaps other than Cleared Sugar 
Swaps, and other over-the-counter transactions that are based on the 
price of sugar and Sugar Futures Contracts (collectively, ``Other Sugar 
Interests,'' and together with Sugar Futures Contracts and Cleared 
Sugar Swaps, ``Sugar Interests'').
    Sugar No. 11 Futures Contracts traded on the ICE Futures expire on 
a specified day in four different months: March, May, July, and 
October. For example, in terms of the Sugar Benchmark, in June of a 
given year (``year 1'') the next-to-expire or ``spot month'' Sugar No. 
11 Futures Contract will expire in July of year 1, and the Sugar 
Benchmark Component Futures Contracts will be the contracts expiring in 
October of year 1 (the second-to-expire contract), March of year 2 (the 
third-to-expire contract), and March of year 3. As another example, in 
November of year 1 the Sugar Benchmark Component Futures Contracts will 
be the contracts expiring in May of year 2, July of year 2, and March 
of year 3.
    The Fund seeks to achieve its investment objective primarily by 
investing in Sugar Interests such that daily changes in the Fund's NAV 
will be expected to closely track the changes in the Sugar Benchmark. 
The Fund's positions in Sugar Interests will be changed or ``rolled'' 
on a regular basis in order to track the changing nature of the Sugar 
Benchmark. For example, four times a year (on the date on which a Sugar 
No. 11 Futures Contract expires), a particular Sugar No. 11 Futures 
Contract will no longer be a Sugar Benchmark Component Futures 
Contract, and the Fund's investments will have to be changed 
accordingly.
    Consistent with achieving the Fund's investment objective of 
closely tracking the Sugar Benchmark, the Sponsor may for certain 
reasons cause the Fund to enter into or hold Cleared Sugar Swaps and/or 
Other Sugar Interests. For example, certain Cleared Sugar Swaps have 
standardized terms similar to, and are priced by reference to, a 
corresponding Sugar Benchmark Component Futures Contract. Additionally, 
Other Sugar Interests that do not have standardized terms and are not 
exchange-traded, referred to as ``over-the-counter'' Sugar Interests, 
can generally be structured as the parties desire. Therefore, the Fund 
might enter into multiple Cleared Sugar Swaps and/or over-the-counter 
Sugar Interests intended to exactly replicate the performance of each 
of the three Sugar Benchmark Component Futures Contracts, or a single 
over-the-counter Sugar Interest designed to replicate the performance 
of the Sugar Benchmark as a whole. According to the Registration 
Statement, assuming that there is no default by a counterparty to an 
over-the-counter Sugar Interest, the performance of the over-the-
counter Sugar Interest will necessarily correlate exactly with the 
performance of the Sugar Benchmark or the applicable Sugar Benchmark 
Component Futures Contract. The Fund might also enter into or hold 
over-the-counter Sugar Interests other than Sugar Benchmark Component 
Futures Contracts to facilitate effective trading, consistent with the 
discussion of the Fund's ``roll'' strategy in the preceding paragraph. 
In addition, the Fund might enter into or hold over-the-counter Sugar 
Interests that would be expected to alleviate overall deviation between 
the Fund's performance and that of the Sugar Benchmark that may result 
from certain market and trading inefficiencies or other reasons.
    The Fund will invest in Sugar Interests to the fullest extent 
possible without being leveraged or unable to satisfy its expected 
current or potential margin or collateral obligations with respect to 
its investments in Sugar Interests.\25\ After fulfilling such margin 
and collateral requirements, the Fund will invest the remainder of its 
proceeds from the sale of baskets in Treasury Securities or cash 
equivalents, and/or hold such assets in cash (generally in interest-
bearing accounts). Therefore, the focus of the Sponsor in managing the 
Fund is investing in Sugar Interests and in Treasury Securities, cash 
and/or cash equivalents.
---------------------------------------------------------------------------

    \25\ The Sponsor represents that the Fund will invest in Sugar 
Interests in a manner consistent with the Fund's investment 
objective and not to achieve additional leverage.
---------------------------------------------------------------------------

    The Sponsor endeavors to place the Fund's trades in Sugar Interests 
and otherwise manage the Fund's investments so that the Fund's average 
daily tracking error against the Sugar Benchmark will be less than 10 
percent over any period of 30 trading days. More specifically, the 
Sponsor will endeavor to manage the Fund so that A will be within plus/
minus 10 percent of B, where A is the average daily change in the 
Fund's NAV for any period of 30 successive valuation days, i.e., any 
trading day as of which the Fund calculates its NAV, and B is the 
average daily change in the Sugar Benchmark over the same period.
    The Sponsor employs a ``neutral'' investment strategy intended to 
track the changes in the Sugar Benchmark regardless of whether the 
Sugar Benchmark goes up or goes down. The Fund's ``neutral'' investment 
strategy is

[[Page 45891]]

designed to permit investors generally to purchase and sell the Fund's 
Shares for the purpose of investing indirectly in the sugar market in a 
cost-effective manner. Such investors may include participants in the 
sugar industry and other industries seeking to hedge the risk of losses 
in their sugar-related transactions, as well as investors seeking 
exposure to the sugar market. The Sponsor does not intend to operate 
the Fund in a fashion such that its per Share NAV will equal, in dollar 
terms, the spot price of a pound or other unit of sugar or the price of 
any particular Sugar Futures Contract.
    U.S. designated contract markets such as the ICE Futures and the 
NYMEX have established accountability levels on the maximum net long or 
net short Sugar Futures Contracts that any person or group of persons 
under common trading control may hold, own or control. For example, the 
current ICE Futures-established accountability level for investments in 
Sugar No. 11 Futures Contracts for any one month is 10,000, and the 
accountability level for all combined months is 15,000. While 
accountability levels are not fixed ceilings, they are thresholds above 
which the exchange may exercise greater scrutiny and control over an 
investor, including limiting an investor to holding no more Sugar No. 
11 Futures Contracts than the amount established by the accountability 
level. Cleared Sugar Swaps are subject to an ICE Futures accountability 
level of 10,000 swap positions for all months combined. This limit is 
measured separately from the accountability levels on Sugar No. 11 
Futures Contracts. Under current law, all Sugar Futures Contracts 
traded on a particular exchange that are held under the control of the 
Sponsor, including those held by any future series of the Trust, are 
aggregated in determining the application of applicable accountability 
levels. The Fund does not intend to invest in Sugar Futures Contracts 
or Cleared Sugar Swaps in excess of any applicable accountability 
levels.
    According to the Registration Statement, the CFTC has not currently 
set position limits for Sugar Futures Contracts, and ICE Futures and 
NYMEX have established such position limits only on spot month Sugar 
No. 11 Futures Contracts. Cleared Sugar Swaps are subject to ICE 
Futures position limits that are substantially identical to, but 
measured separately from, the limits on Sugar No. 11 Futures Contracts. 
However, because the Fund does not expect to hold spot month contracts 
at any time when these position limits would be applicable, it is 
unlikely that these limits will come into play. Currently, the ICE 
Futures and the NYMEX have not imposed maximum daily price fluctuation 
limits on Sugar Futures Contracts. Accountability levels, position 
limits and daily price fluctuation limits set by the CFTC and the 
exchanges have the potential to cause tracking error, which could cause 
the price of Shares to substantially vary from the Sugar Benchmark and 
prevent an investor from being able to effectively use the Fund as a 
way to hedge against sugar-related losses or as a way to indirectly 
invest in sugar.
    The Fund does not intend to limit the size of the offering and will 
attempt to expose substantially all of its proceeds to the sugar market 
utilizing Sugar Interests. If the Fund encounters accountability 
levels, position limits, or price fluctuation limits for Sugar Futures 
Contracts and/or Cleared Sugar Swaps on ICE Futures, it may then, if 
permitted under applicable regulatory requirements, purchase Other 
Sugar Interests and/or Sugar Futures Contracts listed on the NYMEX or 
foreign exchanges. However, the Sugar Futures Contracts available on 
such foreign exchanges may have different underlying sizes, deliveries, 
and prices. In addition, the Sugar Futures Contracts available on these 
exchanges may be subject to their own position limits and 
accountability levels. In any case, notwithstanding the potential 
availability of these instruments in certain circumstances, position 
limits could force the Fund to limit the number of Creation Baskets 
that it sells.\26\
---------------------------------------------------------------------------

    \26\ See note 19, supra.
---------------------------------------------------------------------------

Creation and Redemption of Shares
    The Funds create and redeem Shares only in blocks called ``Creation 
Baskets'' and ``Redemption Baskets,'' respectively, each consisting of 
50,000 Shares. Only Authorized Purchasers may purchase or redeem 
Creation Baskets or Redemption Baskets. An Authorized Purchaser is 
under no obligation to create or redeem baskets, and an Authorized 
Purchaser is under no obligation to offer to the public Shares of any 
baskets it does create. Baskets are generally created when there is a 
demand for Shares, including, but not limited to, when the market price 
per Share is at (or perceived to be at) a premium to the NAV per Share. 
Similarly, baskets are generally redeemed when the market price per 
Share is at (or perceived to be at) a discount to the NAV per Share. 
Retail investors seeking to purchase or sell Shares on any day are 
expected to effect such transactions in the secondary market, on the 
NYSE Arca, at the market price per Share, rather than in connection 
with the creation or redemption of baskets.
    The total deposit required to create each basket (``Creation Basket 
Deposit'') is the amount of Treasury Securities and/or cash that is in 
the same proportion to the total assets of each Fund (net of estimated 
accrued but unpaid fees, expenses and other liabilities) on the 
purchase order date as the number of Shares to be created under the 
purchase order is in proportion to the total number of Shares 
outstanding on the purchase order date. The redemption distribution 
from each Fund will consist of a transfer to the redeeming Authorized 
Purchaser of an amount of Treasury Securities and/or cash that is in 
the same proportion to the total assets of such Fund (net of estimated 
accrued but unpaid fees, expenses and other liabilities) on the date 
the order to redeem is properly received as the number of Shares to be 
redeemed under the redemption order is in proportion to the total 
number of Shares outstanding on the date the order is received.
    The Funds will meet the initial and continued listing requirements 
applicable to TIRs in NYSE Arca Equities Rule 8.200 and Commentary .02 
thereto. With respect to application of Rule 10A-3 \27\ under the Act, 
the Trust relies on the exception contained in Rule 10A-3(c)(7).\28\ A 
minimum of 100,000 Shares for each Fund will be outstanding as of the 
start of trading on the Exchange.
---------------------------------------------------------------------------

    \27\ 17 CFR 240.10A-3.
    \28\ 17 CFR 240.10A-3(c)(7).
---------------------------------------------------------------------------

    A more detailed description of Wheat Interests, Soybean Interests 
and Sugar Interests and other aspects of the applicable commodities 
markets, as well as investment risks, are set forth in the Registration 
Statements. All terms relating to the Funds that are referred to, but 
not defined in, this proposed rule change are defined in the 
Registration Statements.
Availability of Information Regarding the Shares
    The Web site for the Funds (http://www.teucriumwheatfund.com, 
http://www.teucriumsoybeanfund.com and http://www.teucriumsugarfund.com, respectively) and/or the Exchange, which are 
publicly accessible at no charge, will contain the following 
information: (a) The current NAV per Share daily and the prior business 
day's NAV and the reported closing price; (b) the midpoint of the bid-
ask price in

[[Page 45892]]

relation to the NAV as of the time the NAV is calculated (the ``Bid-Ask 
Price''); (c) calculation of the premium or discount of such price 
against such NAV; (d) the bid-ask price of Shares determined using the 
highest bid and lowest offer as of the time of calculation of the NAV; 
(e) data in chart form displaying the frequency distribution of 
discounts and premiums of the Bid-Ask Price against the NAV, within 
appropriate ranges for each of the four (4) previous calendar quarters; 
(f) the prospectus; and (g) other applicable quantitative information. 
The Funds will also disseminate the Funds' holdings on a daily basis on 
the Funds' respective Web sites.
    The NAV for the Funds will be calculated by the Administrator once 
a day and will be disseminated daily to all market participants at the 
same time.\29\ The Exchange also will disseminate on a daily basis via 
the Consolidated Tape Association (``CTA'') information with respect to 
recent NAV, and Shares outstanding. The Exchange will also make 
available on its Web site daily trading volume of each of the Shares, 
closing prices of such Shares, and the corresponding NAV. The closing 
price and settlement prices of the Wheat Futures Contracts and Soybean 
Futures Contracts are also readily available from the CBOT, and of the 
Sugar No. 11 Futures Contracts from ICE Futures. In addition, such 
prices are available from automated quotation systems, published or 
other public sources, or on-line information services such as Bloomberg 
or Reuters. Each benchmark will be disseminated by one or more major 
market data vendors every 15 seconds during the NYSE Arca Core Trading 
Session of 9:30 a.m. to 4:00 p.m. E.T. Quotation and last-sale 
information regarding the Shares will be disseminated through the 
facilities of the CTA. In addition, the Exchange will provide a 
hyperlink on its Web site at http://www.nyx.com to the Funds' Web 
sites, which will display all intraday and closing benchmark levels, 
the intraday Indicative Trust Value (see below), and NAV.
---------------------------------------------------------------------------

    \29\ For each Fund, the NAV will be calculated by taking the 
current market value of the Fund's total assets and subtracting any 
liabilities. Under the Funds' current operational procedures, the 
Administrator will generally calculate the NAV of the Funds' Shares 
as of 4:00 p.m. Eastern Time (``E.T.''). The NAV for a particular 
trading day will be released after 4:15 p.m. E.T.
---------------------------------------------------------------------------

    The daily settlement prices for the Wheat Futures Contracts and 
Soybeans Futures Contracts are publicly available on the Web site of 
the CBOT (http://www.cmegroup.com) and, for the Sugar No. 11 Futures 
Contracts, on the Web site of ICE Futures (http://www.theice.com). In 
addition, various data vendors and news publications publish futures 
prices and data. The Exchange represents that quotation and last sale 
information for the Wheat Futures Contracts, Soybean Futures Contracts 
and Sugar No. 11 Futures Contracts are widely disseminated through a 
variety of major market data vendors worldwide, including Bloomberg and 
Reuters. In addition, the Exchange further represents that complete 
real-time data for such contracts is available by subscription from 
Reuters and Bloomberg. The CBOT and ICE Futures also provide delayed 
futures information on current and past trading sessions and market 
news free of charge on their Web sites. The specific contract 
specifications for such contracts are also available at the CBOT and 
ICE Futures Web sites, as well as other financial informational 
sources. The spot price of wheat, soybeans and sugar also is available 
on a 24-hour basis from major market data vendors.
    Each Fund will provide Web site disclosure of portfolio holdings 
daily and will include, as applicable, the names, quantity, price and 
market value of Wheat, Soybean and Sugar Benchmark Component Futures 
Contracts, as applicable, and other financial instruments, if any, and 
the characteristics of such instruments and cash equivalents, and 
amount of cash held in the portfolios of the Funds. This Web site 
disclosure of the portfolio composition of the Funds will occur at the 
same time as the disclosure by the Sponsor of the portfolio composition 
to Authorized Purchasers so that all market participants are provided 
portfolio composition information at the same time. Therefore, the same 
portfolio information will be provided on the public Web sites as well 
as in electronic files provided to Authorized Purchasers. Accordingly, 
each investor will have access to the current portfolio composition of 
the Funds through the Funds' Web sites.
Dissemination of Indicative Trust Value
    In addition, in order to provide updated information relating to 
the Funds for use by investors and market professionals, an updated 
Indicative Trust Value (``ITV'') will be calculated. The ITV is 
calculated by using the prior day's closing NAV per Share of each Fund 
as a base and updating that value throughout the trading day to reflect 
changes in the value of the Wheat, Soybean and Sugar Benchmark 
Component Futures Contracts, as applicable, and other financial 
instruments, if any. As stated in the Registration Statements, changes 
in the value of Treasury Securities and cash equivalents will not be 
included in the calculation of the ITV. The ITV disseminated during 
NYSE Arca trading hours should not be viewed as an actual real time 
update of the NAV, which is calculated only once a day.
    The ITV will be disseminated on a per Share basis by one or more 
major market data vendors every 15 seconds during the NYSE Arca Core 
Trading Session. The normal trading hours for Wheat Futures Contracts 
on the CBOT are 10:30 a.m. E.T. to 2:15 p.m. E.T. The normal trading 
hours for Soybean Futures Contracts on the CBOT are 10:30 a.m. E.T. to 
2:15 p.m. E.T. Thus, there is a gap in time at the end of each day 
during which the Funds' Shares are traded on the NYSE Arca, but real-
time CBOT trading prices for Wheat Futures Contracts and Soybean 
Futures Contracts traded on CBOT are not available. As a result, during 
those gaps there will be no update to the ITV. Therefore, a static ITV 
will be disseminated, between the close of trading on CBOT of Wheat 
Futures Contracts and Soybean Futures Contracts and the close of the 
NYSE Arca Core Trading Session.
    The normal trading hours for Sugar No. 11 Futures Contracts on ICE 
Futures are 3:30 a.m. E.T. to 2:00 p.m. E.T. Thus, there is a gap in 
time at the end of each day during which the Teucrium Sugar Fund's 
Shares are traded on NYSE Arca, but real-time ICE Futures trading 
prices for Sugar Futures Contracts traded on ICE Futures are not 
available. As a result, during those gaps there will be no update to 
the ITV. Therefore, a static ITV will be disseminated, between the 
close of trading on ICE Futures of Sugar No. 11 Futures Contracts and 
the close of the NYSE Arca Core Trading Session. The value of Shares of 
each Fund may be influenced by non-concurrent trading hours between 
NYSE Arca and the CBOT and ICE Futures, as applicable, when such Shares 
are traded on NYSE Arca after normal trading hours of the applicable 
futures contracts on CBOT or ICE Futures.
    The Exchange believes that dissemination of the ITV provides 
additional information regarding each Fund that is not otherwise 
available to the public and is useful to professionals and investors in 
connection with the related Shares trading on the Exchange or the 
creation or redemption of such Shares.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's

[[Page 45893]]

existing rules governing the trading of equity securities. Shares will 
trade on the NYSE Arca Marketplace from 4:00 a.m. to 8:00 p.m. E.T. The 
Exchange has appropriate rules to facilitate transactions in the Shares 
during all trading sessions. As provided in NYSE Arca Equities Rule 
7.6, Commentary .03, the minimum price variation (``MPV'') for quoting 
and entry of orders in equity securities traded on the NYSE Arca 
Marketplace is $0.01, with the exception of securities that are priced 
less than $1.00 for which the MPV for order entry is $0.0001.
    The trading of the Shares will be subject to NYSE Arca Equities 
Rule 8.200, Commentary .02(e), which sets forth certain restrictions on 
ETP Holders acting as registered Market Makers in TIRs to facilitate 
surveillance. See ``Surveillance'' below for more information.
    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in the Shares. Trading may be halted because of market 
conditions or for reasons that, in the view of the Exchange, make 
trading in the Shares inadvisable. These may include: (1) The extent to 
which trading is not occurring in the underlying futures contracts, or 
(2) whether other unusual conditions or circumstances detrimental to 
the maintenance of a fair and orderly market are present. In addition, 
trading in Shares will be subject to trading halts caused by 
extraordinary market volatility pursuant to the Exchange's ``circuit 
breaker'' rule \30\ or by the halt or suspension of trading of the 
underlying futures contracts.
---------------------------------------------------------------------------

    \30\ See NYSE Arca Equities Rule 7.12.
---------------------------------------------------------------------------

    The Exchange represents that the Exchange may halt trading during 
the day in which an interruption to the dissemination of the ITV or the 
value of the underlying futures contracts or the applicable benchmark 
occurs. If the interruption to the dissemination of the ITV, the value 
of the underlying futures contracts or the applicable benchmark 
persists past the trading day in which it occurred, the Exchange will 
halt trading no later than the beginning of the trading day following 
the interruption. In addition, if the Exchange becomes aware that the 
NAV with respect to the Shares is not disseminated to all market 
participants at the same time, it will halt trading in the Shares until 
such time as the NAV is available to all market participants.
Surveillance
    The Exchange intends to utilize its existing surveillance 
procedures applicable to derivative products, including TIRs, to 
monitor trading in the Shares. The Exchange represents that these 
procedures are adequate to properly monitor Exchange trading of the 
Shares in all trading sessions and to deter and detect violations of 
Exchange rules and applicable federal securities laws.
    The Exchange's current trading surveillances focus on detecting 
securities trading outside their normal patterns. When such situations 
are detected, surveillance analysis follows and investigations are 
opened, where appropriate, to review the behavior of all relevant 
parties for all relevant trading violations. The Exchange is able to 
obtain information regarding trading in the Shares, the physical 
commodities included in, or options, futures or options on futures on, 
Shares through ETP Holders, in connection with such ETP Holders' 
proprietary or customer trades through ETP Holders which they effect on 
any relevant market. The Exchange can obtain market surveillance 
information, including customer identity information, with respect to 
transactions occurring on exchanges that are members of the Intermarket 
Surveillance Group (``ISG'') or with which the Exchange has in place a 
comprehensive surveillance sharing agreement. With respect to the 
Teucrium Wheat Fund, the Exchange can obtain market surveillance 
information from CBOT, KCBT and MGEX in that CBOT is a member of ISG 
and the Exchange has in place a comprehensive surveillance sharing 
agreement with KCBT and MGEX. Likewise, with respect to the Teucrium 
Soybean Fund, the Exchange can obtain market surveillance information 
from CBOT as a member of ISG. With respect to the Teucrium Sugar Fund, 
the Exchange can obtain market surveillance information from NYMEX and 
ICE Futures in that both such exchanges are ISG members. A list of ISG 
members is available at http://www.isgportal.org.\31\
---------------------------------------------------------------------------

    \31\ The Exchange notes that not all Wheat Interests, Soybean 
Interests and Sugar Interests may trade on markets that are members 
of ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.
---------------------------------------------------------------------------

    In addition, with respect to the Funds' futures contracts traded on 
exchanges, not more than 10% of the weight of such futures contracts in 
the aggregate shall consist of components whose principal trading 
market is not a member of ISG or is a market with which the Exchange 
does not have a comprehensive surveillance sharing agreement.
    The Exchange also has a general policy prohibiting the distribution 
of material, non-public information by its employees.
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its 
ETP Holders in an Information Bulletin of the special characteristics 
and risks associated with trading the Shares. Specifically, the 
Information Bulletin will discuss the following: (1) The risks involved 
in trading the Shares during the Opening and Late Trading Sessions when 
an updated ITV will not be calculated or publicly disseminated; (2) the 
procedures for purchases and redemptions of Shares in Creation Baskets 
and Redemption Baskets (and that Shares are not individually 
redeemable); (3) NYSE Arca Equities Rule 9.2(a), which imposes a duty 
of due diligence on its ETP Holders to learn the essential facts 
relating to every customer prior to trading the Shares; (4) how 
information regarding the ITV is disseminated; (5) that a static ITV 
will be disseminated, between the close of trading on the applicable 
futures exchange and the close of the NYSE Arca Core Trading Session; 
(6) the requirement that ETP Holders deliver a prospectus to investors 
purchasing newly issued Shares prior to or concurrently with the 
confirmation of a transaction; and (7) trading information.
    In addition, the Information Bulletin will advise ETP Holders, 
prior to the commencement of trading, of the prospectus delivery 
requirements applicable to the Funds. The Exchange notes that investors 
purchasing Shares directly from each Fund will receive a prospectus. 
ETP Holders purchasing Shares from each Fund for resale to investors 
will deliver a prospectus to such investors. The Information Bulletin 
will also discuss any exemptive, no-action and interpretive relief 
granted by the Commission from any rules under the Act.
    In addition, the Information Bulletin will reference that the Funds 
are subject to various fees and expenses described in the Registration 
Statements. The Information Bulletin will also reference that the CFTC 
has regulatory jurisdiction over the trading of wheat, soybean and 
sugar futures contracts traded on U.S. markets.
    The Information Bulletin will also disclose the trading hours of 
the Shares of each Fund and that the NAV for the Shares is calculated 
after 4:00 p.m. E.T. each trading day. The Bulletin will

[[Page 45894]]

disclose that information about the Shares of each Fund is publicly 
available on the Funds' Web sites.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under Section 6(b)(5) \32\ that an exchange have rules that 
are designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to, and perfect the mechanism of a free and open market 
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \32\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed rule change is designed to 
prevent fraudulent and manipulative acts and practices in that the 
Shares will be listed and traded on the Exchange pursuant to the 
initial and continued listing criteria in NYSE Arca Equities Rule 8.200 
and Commentary .02 thereto. The Exchange has in place surveillance 
procedures that are adequate to properly monitor trading in the Shares 
in all trading sessions and to deter and detect violations of Exchange 
rules and applicable federal securities laws. The Wheat, Soybean and 
Sugar Benchmark Component Futures Contracts are traded on futures 
exchanges that are members of ISG or with which the Exchange has in 
place a comprehensive surveillance sharing agreement. With respect to 
the Funds' futures contracts traded on exchanges, not more than 10% of 
the weight of such futures contracts in the aggregate shall consist of 
components whose principal trading market is not a member of ISG or is 
a market with which the Exchange does not have a comprehensive 
surveillance sharing agreement. The closing price and settlement prices 
of the Wheat Futures Contracts and Soybean Futures Contracts are 
readily available from the CBOT, and of the Sugar No. 11 Futures 
Contracts from ICE Futures. In addition, such prices are available from 
automated quotation systems, published or other public sources, or on-
line information services. Each benchmark will be disseminated by one 
or more major market data vendors every 15 seconds during the NYSE Arca 
Core Trading Session of 9:30 a.m. to 4:00 p.m. E.T. Quotation and last-
sale information regarding the Shares will be disseminated through the 
facilities of the CTA. The ITV will be disseminated on a per Share 
basis by one or more major market data vendors every 15 seconds during 
the NYSE Arca Core Trading Session. The Exchange may halt trading 
during the day in which the interruption to the dissemination of the 
ITV or the value of the underlying futures contracts or applicable 
benchmark occurs. If the interruption to the dissemination of the ITV, 
the value of the underlying futures contracts or the applicable 
benchmark persists past the trading day in which it occurred, the 
Exchange will halt trading no later than the beginning of the trading 
day following the interruption. In addition, if the Exchange becomes 
aware that the NAV with respect to the Shares is not disseminated to 
all market participants at the same time, it will halt trading in the 
Shares until such time as the NAV is available to all market 
participants.
    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that a large amount of information is publicly available regarding the 
Funds and the Shares, thereby promoting market transparency. Quotation 
and last sale information for the Wheat Futures Contracts, Soybean 
Futures Contracts and Sugar No. 11 Futures Contracts are widely 
disseminated through a variety of major market data vendors worldwide. 
Complete real-time data for such contracts is available by subscription 
from Reuters and Bloomberg. The CBOT and ICE Futures also provide 
delayed futures information on current and past trading sessions and 
market news free of charge on their Web sites. Each benchmark will be 
disseminated by one or more major market data vendors every 15 seconds 
during the NYSE Arca Core Trading Session of 9:30 a.m. to 4:00 p.m. 
E.T. The spot price of wheat, soybeans and sugar also is available on a 
24-hour basis from major market data vendors. Each Fund will provide 
Web site disclosure of portfolio holdings daily and will include, as 
applicable, the names, quantity, price and market value of Wheat, 
Soybean and Sugar Benchmark Component Futures Contracts, as applicable, 
and other financial instruments, if any, and the characteristics of 
such instruments and cash equivalents, and amount of cash held in the 
portfolios of the Funds. The NAV per Share will be calculated daily and 
made available to all market participants at the same time. One or more 
major market data vendors will disseminate for the Funds on a daily 
basis information with respect to the recent NAV per Share and Shares 
outstanding. NYSE Arca will calculate and disseminate every 15 seconds 
throughout the NYSE Arca Core Trading Session an updated ITV.
    The proposed rule change is designed to perfect the mechanism of a 
free and open market and, in general, to protect investors and the 
public interest in that it will facilitate the listing and trading of 
additional types of exchange-traded products that will enhance 
competition among market participants, to the benefit of investors and 
the marketplace. As noted above, the Exchange has in place surveillance 
procedures relating to trading in the Shares and may obtain information 
via ISG from other exchanges that are members of ISG or with which the 
Exchange has entered into a comprehensive surveillance sharing 
agreement. In addition, as noted above, investors will have ready 
access to information regarding the Funds' holdings, ITV, and quotation 
and last sale information for the Shares.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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 (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 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 (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File

[[Page 45895]]

Number SR-NYSEArca-2011-48 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-NYSEArca-2011-48. 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 Web site 
viewing and printing 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 such filing also will be 
available for inspection and copying at the principal office of the 
Exchange. All comments received will be posted without change; the 
Commission does not edit personal identifying information from 
submissions. You should submit only information that you wish to make 
available publicly. All submissions should refer to File Number SR-
NYSEArca-2011-48 and should be submitted on or August 22, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\33\
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    \33\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-19329 Filed 7-29-11; 8:45 am]
BILLING CODE 8011-01-P


