Federal Register / Vol. 62, No. 175 / Wednesday, September 10, 1997 / Notices 47711

2SunAmerica Inc. does not own any of the

outstanding shares of the Acquired Fund as of June

30, 1997. 1 15 U.S.C. 78s(b)(1).

Acquiring Fund and Acquired Fund,

respectively.

8. The distribution of the Issued

Shares to the shareholders of the

Acquired Fund will be accomplished by

the establishment of an open account on

the share records of the Acquiring Fund

in the name of each shareholder of the

Acquired Fund and representing the

respective pro rata number of Issued

Shares of the same class as, and equal

in value to the value of, the Exchanged

Shares held by such shareholder at the

Effective Date. Exchanged Shares held

in an open account with the transfer

agent of the Acquired Fund will

automatically become the number of

Issued Shares provided for above and be

held in an open account with the

transfer agent of the Acquiring Fund.

9. The Agreement provides that the

Acquired Fund will make one or more

distributions to shareholders prior to the

Effective Date which, together with all

previous distributions, will have the

effect of distributing to its Class A and

B shareholders all of its net investment

income and capital gains for the period

from the close of its last fiscal year to

the close of business on the Effective

Date and any undistributed amounts

thereof from the last fiscal year.

10. On May 22, 1997, the board of

directors of the Company and the board

of trustees of the Trust (collectively, the

‘‘Boards’’), including their disinterested

directors and trustees, respectively,

unanimously approved the Agreement.

In deciding to approve the Agreement,

the Boards concluded that the

Reorganization would operate in the

best interests of the relevant Fund and

its shareholders and that the interests of

the shareholders of each Fund would

not be diluted as a result of the

Reorganization.

11. In deciding to approve the

Agreement and recommend it to the

shareholders of the Acquired Fund, the

Board of the Trust reviewed information

related to the following factors: (1)

Performance of the Funds; (2) Funds’

fees and expenses; (3) Funds’ growth

rate and economies of scale; (4) the

similarities of the Funds; (5) the tax-free

nature of the transaction; and (6) lack of

dilution of the interests of the Acquired

Fund shareholders.

12. All costs of the Reorganization,

including the costs of printing and

mailing the prospectus/proxy statement

and the costs of the special meeting of

shareholders of the Acquired Fund

scheduled for September 5, 1997 (the

‘‘Meeting’’), will be borne by SAAMCo

and not by either Fund.

13. A definitive prospectus/proxy

statement relating to the Meeting was

filed with the SEC on July 8, 1997.

Applicants sent the prospectus/proxy

statement to shareholders of the

Acquired Fund on July 8, 1997, for their

approval at the Meeting.

14. The Agreement sets forth certain

conditions to the consummation of the

Reorganization, including the approval

of the Reorganization by shareholders of

the Acquired Fund, receipt of an

opinion of counsel as to tax matters, and

receipt of the SEC order requested in the

application.

15. The Agreement and the

Reorganization may be terminated by

either Board notwithstanding approval

by the shareholders of the Acquired

Fund at any time prior to the Effective

Date if circumstances should develop

that, in the opinion of either Board,

make proceeding with the Agreement

inadvisable. Applicants agree not to

make any material changes to the

Agreement without prior SEC approval.

Applicants’ Legal Analysis

1. Section 17(a) generally prohibits an

affiliated person of a registered

investment company, or any affiliated

person of such person, from selling any

security to or purchasing any security

from the company. Section 2(a)(3)(C)

defines the term ‘‘affiliated person’’ of

another person to include any person

controlling, controlled by, or under

common control with such person.

2. Rule 17a–8 exempts from the

prohibitions of section 17(a) mergers,

consolidations, or purchases or sales of

substantially all of the assets of

registered investment companies that

are affiliated persons solely by reason of

having a common investment adviser,

common directors/trustees, and/or

common officers, provided that certain

conditions are satisfied.

3. Applicants believe that they may

not rely on rule 17a–8 in connection

with the Reorganization because the

Acquiring Fund and the Acquired Fund

may be affiliated for reasons other than

those set forth in the rule. Specifically,

SunAmerica Inc. indirectly owns 100%

of the outstanding voting securities of

each of SAAMCo and SACS, the adviser

to and distributor of, respectively, both

Funds. As of June 30, 1997, the record

date for the Meeting, SunAmerica Inc.

also owns with the power to vote

approximately 32% of the outstanding

shares of the Acquiring Fund.2 Because

of this ownership, applicants believe

that the Acquiring Fund may be deemed

an affiliated person of an affiliated

person of the Acquired Fund, and vice

versa, for reasons not based solely on

their common adviser.

4. Section 17(b) authorizes the SEC to

exempt a proposed transaction from

section 17(a) if the terms of the

proposed transaction, including the

consideration to be paid or received, are

reasonable and fair and do not involve

overreaching on the part of any person

concerned; the proposed transaction is

consistent with the policies of each

registered investment company

concerned and the general purposes of

the Act.

5. Applicants submit that the terms of

the Reorganization satisfy the standards

set forth in section 17(b), in that the

terms are fair and reasonable and do not

involve overreaching on the part of any

person concerned. Applicants note that

each Board, including the noninterested trustees and directors, as

applicable, reviewed the terms of the

Reorganization as set forth in the

Agreement, including the consideration

to be paid or received, and found that

participation in the Reorganization as

contemplated by the Agreement is in the

best interests of the Company, the Trust,

and each Fund, and that the interests of

existing shareholders of each Fund will

not be diluted as a result of the

Reorganization. Applicants also note

that the exchange of the Acquired

Fund’s assets and liabilities for the

shares of the Acquiring Fund will be

based on the Funds’ relative net asset

values.

For the SEC, by the Division of Investment

Management, under delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–23952 Filed 9–9–97; 8:45 am]

BILLIING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39008; File No. SR–Amex–

97–32]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

American Stock Exchange, Inc.

Relating to Board Telephone

Conferencing and Exchange Official

Qualification Requirements

September 3, 1997.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

August 20, 1997, the American Stock

Exchange, Inc. (‘‘Amex’’ or ‘‘Exchange’’)

filed with the Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’)
47712 Federal Register / Vol. 62, No. 175 / Wednesday, September 10, 1997 / Notices

2See Article IV, Section 5 of the New York Stock

Exchange Constitution.

3 15 U.S.C. 78f(b).

4 15 U.S.C. 78f(b)(5).

5 17 CFR 240.19b–4(e)(6). 6 17 CFR 200.30–3(a)(12).

the proposed rule change as described

in Items I, II, and III below, which Items

have been prepared by the selfregulatory organization. The

Commission is publishing this notice to

solicit comments on the proposed rule

change from interested persons.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The Exchange is proposing to amend

Article II, Section 2 of the Exchange

Constitution to (i) permit Governors to

attend Board meetings by means of a

conference telephone, and (ii) clarify

that individuals who are employed by

or associated with a member

organization in a senior capacity may be

appointed as Exchange Officials. The

text of these statements may be

examined at the places specified in Item

IV below.

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 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.

A. Self-Regulatory Organization’s

Statement of the Purpose of, and the

Statutory Basis for, the Proposed Rule

Change

1. Purpose

In order to facilitate the fullest

possible participation in board

meetings, it is proposed that Article II,

Section 2 of the Exchange Constitution

be amended to provide that

participation in a meeting of the Board

of Governors by means of a conference

telephone or similar communications

equipment, which allows all persons

participating in the meeting to hear each

other at the same time, shall constitute

presence in person at a meeting. New

York law permits this procedure, but

only if the appropriate authorization is

contained in the corporate by-laws (in

the case of the Exchange, its

Constitution). It has become common in

corporate America to provide for this

convenience, and the New York Stock

Exchange and most other self-regulatory

organizations permit it as well.2

In addition, it is proposed that Article

II, Section 2 of the Exchange

Constitution be amended to clarify the

description of the pool of individuals

who are qualified to serve as Exchange

Officials. Particularly as upstairs firms

have grown and developed more

complex organizations, the senior

employees who are so well qualified to

serve as Exchange Officials may not

easily be described as ‘‘principal

executive officers’’ or ‘‘control persons.’’

Accordingly, we would expand the

Constitutional qualification to include

individuals who are employed by or

associated with a member organization

in a senior capacity.

2. Statutory Basis

The proposed rule change is

consistent with Section 6(b) of the Act 3

in general and furthers the objectives of

Section 6(b)(5) 4 in particular in that it

is designed to promote just and

equitable principles of trade and protect

the public interest.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The proposed rule change will impose

no burden on competition.

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

Because the foregoing proposed rule

change: (1) Does not significantly affect

the protection of investors or the public

interest; (2) does not impose any

significant burden on competition; and

(3) does not become operative for 30

days from August 20, 1997, the date on

which it was filed, and the Exchange

provided the Commission with written

notice of its intent to file the proposed

rule change at least five business days

prior to the filing date, it has become

operative pursuant to Section

19(b)(3)(A) of the Act and Rule 19b–

4(e)(6) thereunder.5

At any time within 60 days of the

filing of the proposed rule change, the

Commission may summarily abrogate

such rule change if it appears to the

Commission that such action is

necessary or appropriate in the public

interest, for the protection of investors,

or otherwise in furtherance of the

purposes of the Act.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views and

arguments concerning the foregoing.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of the

submission, all subsequent

amendments, all written statements

with respect to the proposed rule

change that are filed with the

Commission, and all written

communications relating to the

proposed rule change between the

Commission and any person, other than

those that may be withheld from the

public in accordance with the

provisions of 5 U.S.C. 552, will be

available for inspection and copying in

the Commission’s Public Reference

Room. Copies of the filing will also be

available for inspection and copying at

the principle office of the Amex. All

submissions should refer to the file

number SR–Amex–97–32 and should be

submitted by October 1, 1997.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–23956 Filed 9–9–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39010; File No. SR–CBOE–

97–39]

Self-Regulatory Organizations; Notice

of Filing of and Order Granting

Accelerated Approval to Proposed

Rule Change by the Chicago Board

Options Exchange, Incorporated

Relating to Amendments to the

Exchange’s Telephone Solicitation

Rule

September 3, 1997.

Pursuant to section 19(b)(1) of the

Securities Exchange Act of 1934, 15

U.S.C. 78s(b)(1), notice is hereby given

that on August 25, 1997, the Chicago

Board Options Exchange, Incorporated

(‘‘CBOE or Exchange’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change as described in Items I, II, and

III below, which Items have been