56220 Federal Register / Vol. 62, No. 209 / Wednesday, October 29, 1997 / Notices

3 15 U.S.C. 78f(b)(4).

4 In approving this rule, the Commission notes

that it has considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

U.S.C. 78c(f).

5Telephone conversation between Vincent A.

Pattent, Assistant Vice President, NYSE, and

Heather Seidel, Attorney, Market Regulation,

Commission, on October 7, 1997,

6 15 U.S.C. 78s(b)(2).

7 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4. 3 15 U.S.C. 78f(b)(5).

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 at

the Commission’s Public Reference

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the Exchange. All

submissions should refer to File No.

SR–NYSE–97–26 and should be

submitted by November 19, 1997.

IV. Commission’s Findings and Order

Granting Accelerated Approval of

Proposed Rule Change

The Commission finds that the

NYSE’s proposed rule change is

consistent with the requirements of

Section 6(b) of the Act and the rules and

regulations thereunder applicable to a

national securities exchange.

Specifically, the Commission finds that

the proposed rule change is consistent

with Section 6(b)(4) of the Act 3 which

provides that an exchange have rules

that provide for the equitable allocation

of reasonable dues, fees and other

charges among its members and other

persons using its facilities.4 The

Commission believes that the proposed

rule change to amend the definition of

short-term security, for purposes of

listing fees only, is reasonable because

it could help benefit issuers and

investors by reducing listing fees on

certain short-term products. The

Commission notes that the NYSE has

represented that this proposed change

would not effect any other NYSE rules.5

The Commission finds good cause for

approving the proposed rule change

prior to the thirtieth day after the date

of publication of notice of filing thereof

in the Federal Register. The

Commission believes that accelerated

approval of the proposal is appropriate

because it will provide benefits to

investors in an expedited way. Further,

the Commission believes that the

proposed rule change does not raise any

new regulatory issues.

It is therefore ordered, pursuant to

Section 19(b)(2) 6 that the proposed rule

change is hereby approved on an

accelerated basis.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.7

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–28569 Filed 10–28–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39262; File No. SR–NYSE–

97–29]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by New York

Stock Exchange, Inc., Relating to

Subsequent Listing Applications

October 21, 1997.

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

Securities Exchange Act of 1934,

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that on October

17, 1997, the New York Stock Exchange,

Inc. (‘‘NYSE’’ or the ‘‘Exchange’’) filed

with the Securities and Exchange

Commission (‘‘Commission’’ or ‘‘SEC’’)

the proposed rule change as described

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

have been prepared by the NYSE. 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 NYSE is proposing to amend the

form of listing application for

companies seeking, among other things,

to list additional securities on the

Exchange or seeking to make changes in

securities already listed. The proposed

rule change will change the format of

the listing application into that of a

memorandum and will remove from the

application information not necessary

for the Exchange to review in analyzing

the transaction and authorizing the

listing.

The text of the proposed rule change

is available at the Office of the

Secretary, NYSE, and at the

Commission.

II. Self-Regulatory Organization’s

Statement of the Purpose of and

Statutory Basis for, the Proposed Rule

Change

In this filing with the Commission,

the NYSE 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

NYSE has prepared summaries, set forth

in sections A, B, and C below, of the

most significant aspects of such

statements.

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

1. Purpose

Under Section 7, ¶ 703.01 of the

Listed Company Manual, NYSE-listed

companies must apply for Exchange

approval to list additional securities

(such as additional shares of common

stock the company may be issuing), to

make changes in a listed security (such

as with respect to a company’s name

change or change in state of

incorporations), or to list securities that

could be issued upon conversion of

other securities. These subsequent

listing applications generally are routine

in nature. In 1995 and 1996, the

Exchange authorized over 1805 and

2160 subsequent listing applications,

respectively.

The NYSE believes that the current

listing application format, as provided

in Section 9, ¶ 903.02 of the Listed

Company Manual, is cumbersome and

requires companies to provide

information beyond that necessary for

the Exchange to analyze the transaction

and authorize the listing of the

securities. This proposed rule change

would simplify the application process

by changing the form of the application

to a ‘‘memorandum format’’ and

removing the requirement to provide

information beyond that necessary to

analyze the transaction and authorize

the listing. Companies still would be

required to submit all relevant

supporting documents, such as a

Commission registration statement and

an opinion of counsel.

2. Basis

The Exchange believes that the basis

under the Act for the proposed rule

change is the requirement under Section

6(b)(5) 3 that an exchange have rules that

are designed to prevent fraudulent and
Federal Register / Vol. 62, No. 209 / Wednesday, October 29, 1997 / Notices 56221

4 15 U.S.C. 78s(b)(3)(A).

5 17 CFR 240.19b–4(e)(6).

6 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b-4.

3The Commission previously approved the

trading of standardized cash-settled, Europeanstyle

stock index options on the Taiwan Index on

December 23, 1996. See Securities Exchange Act

Release No. 38081, 62 FR 138 (January 2, 1997)

(order approving File No. SR–PSE–96–40). The

Taiwan Index is a broad-based index, comprised of

113 representative stocks traded on the Taiwan

Stock Exchange.

4See Securities Exchange Act Release No. 38920

(August 11, 1997), 62 FR 44027.

5See Securities Act Release No. 34364 (July 13,

1994), 59 FR 36813 (July 19, 1994) (order approving

File No. SR–PSE–93–13) (‘‘Wilshire/PSE

Technology Order’’).

6The Commission has previously designated

FLEX Index Options as standardized options for the

purposes of the options disclosure framework

established under Rule 9b-1 of the Act. See

Securities Exchange Act Release No. 31910

(February 23, 1993), 58 FR 12056 (March 2, 1993).

In addition, the Commission has approved the

listing by the PCX of FLEX Index Options on the

Wilshire Small Cap and PSE Technology Indexes.

See Wilshire/PSE Technology Order, supra note 5.

7These rules currently allow the Exchange to

trade FLEX Index Options on the Wilshire Small

Cap Index and the PSE Technology Index. The PCX

has proposed to set position and exercise limits for

FLEX options on the Index at 200,000 contracts, as

set forth in PCX Rule 8.107. This is the same FLEX

position and exercise limits established for the

Wilshire Small Cap and PSE Technology Indexes.

8See supra note 3.

9An American-style option is one that may be

exercised at any time on or before the expiration

date.

10A European-style option is one that may be

exercised only during a limited period of time prior

to expiration of the option.

11A capped-style index option is one that is

automatically exercised prior to expiration when

the cap index value is less than or equal to the

index value for calls or when the cap index value

is greater than or equal to the index value for puts.

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 a national market

system, and, in general, to protect

investors and the public interest.

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.

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 rule change: (1)

Does not significantly affect the

protection of investors or the public

interest; (2) does not impose any

significant burden on competition; (3)

does not become operative for 30 days

from the date of its filing; and (4) the

Exchange provided the Commission

with notice of its intent to file the

proposed rule change at least five days

prior to the filing date, the proposed

rule change has become effective

pursuant to Section 19(b)(3)(A) 4 of the

Act and Rule 19b–4(e)(6) 5 thereunder.

At any time within 60 days of the filing

of such proposed rule change, the

Commission may summarily abrogate

such rule change if it appears to

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 U.S.C. 552, will be

available for inspection and copying in

the Commission’s Public Reference

Room. Copies of such filings will also be

available for inspection and copying at

the principal office of the NYSE. All

submissions should refer to the File No.

SR–NYSE–97–29 and should be

submitted by November 19, 1997.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–28570 Filed 10–28–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34– 39265; File No. SR–PCX–

97–22]

Self-Regulatory Organizations; Pacific

Exchange, Inc.; Order Granting

Approval to Proposed Rule Change

Relating to the Trading of FLEX Index

Options and LEAPS on the Dow Jones

& Co. Taiwan Index

October 22, 1997

I. Introduction

On June 9, 1997, the Pacific Exchange,

Inc. (‘‘PCX ’’ or ‘‘Exchange’’) submitted

to the Securities and Exchange

Commission (‘‘SEC’’ or ‘‘Commission’’),

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

Securities Exchange Act of 1934

(‘‘Act’’),1 and Rule 19b-4 thereunder,2 a

proposed rule change to amend its rules

to allow the trading of Flexible

Exchange Options (‘‘FLEX Options’’)

and long-term index option series

(‘‘LEAPS’’) on the Dow Jones & Co.

Taiwan Index (‘‘Taiwan Index’’ or

‘‘Index’’).3

The proposed rule change was

published for comment in the Federal

Register on August 18, 1997.4 No

comments were received on the

proposal. This order approves the

proposal.

II. Description of the Proposal

The Commission previously approved

the Exchange’s proposal to allow trading

in FLEX Options on the Wilshire Small

Cap and PSE Technology Indexes.5

FLEX Options give investors the ability,

within specified limits, to designate

certain of the terms of the options. In

recent years, an over-the-counter

(‘‘OTC’’) market in customized options

has developed which permits

participants to designate the basis terms

of the options, including size, term to

expiration, exercise style, exercise price,

and exercise settlement value, in order

to meet their individual investment

needs. Participants in the OTC market

are typically institutional investors, who

buy and sell options in large-size

transactions through a relatively small

number of securities dealers. To

compete with this growing OTC market

in customized options, the PCX permits

FLEX index options trading with the

Options Clearing Corporation (‘‘OCC’’)

as issuer and guarantor.6

The PCX now proposed to amend its

Rules 8.100 and 8.1027 to permit the

trading of FLEX Options based on the

same Dow Jones & Co. Taiwan Index

previously approved for standardized

non-Flex options trading.8 The PCX’s

proposal will allow FLEX Option

market participants to designate the

following contract terms for FLEX

Options on the Taiwan Index: (1)

exercise price; (2) exercise style (i.e.,

American,9 European,10 or capped 11);