Federal Register / Vol. 62, No. 35 / Friday, February 21, 1997 / Notices 8071

5 15 U.S.C. 78q–1.

6 17 CFR 200.30–3(1)(12).

1 15 U.S.C. § 78s(b).

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 34–38127

(January 14, 1997). 4 15 U.S.C. § 78(b).

ambiguity as to the latest time for

honoring demands upon letters of

credit, letters of credit must state

expressly that payment must be made

prior to the close of business on the

third banking day following demand.

Second, letters of credit must be

irrevocable. Third, letters of credit must

expire on a quarterly basis. Fourth, OCC

included language in its Rule 604 to

make explicit OCC’s authority to draw

upon letters of credit at any time,

whether or not the clearing member that

deposited the letter of credit has been

suspended or is in default, if OCC

determines that such draws are

advisable to protect OCC, other clearing

members, or the general public.

According to OCC, since its original

filing, OCC has received no adverse

comments or complaints from any of its

clearing members, the banks, or other

interested parties with respect to the

modifications to Rule 604 or the

implementation of the revised letter of

credit standards. As a result, OCC now

requests that the Commission

permanently approve its revisions.

OCC believes that the proposed rule

change is consistent with the

requirements of Section 17A of the Act 5

because the proposed rule change

promotes the protection of investors by

enhancing OCC’s ability to safeguard the

securities and funds in its possession or

subject to its control.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

OCC does not believe that the

proposed rule change would impose any

burden on competition.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

Comments were not and are not

intended to be solicited by OCC with

respect to the proposed rule change, and

none were received.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Within thirty-five 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

ninety 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 OCC consents, the

Commission will:

(a) by order approve such proposed

rule change or

(b) institute proceedings to determine

whether the proposed rule change

should be disapproved.

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

Section, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of OCC. All submissions should

refer to the file number SR–OCC–96–15

and should be submitted by March 14,

1997.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–4234 Filed 2–20–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38279; File No. SR–PSE–

96–48]

Self-Regulatory Organizations; Pacific

Stock Exchange, Inc.; Order Granting

Approval to Proposed Rule Change

Relating to A.M.-Settlement

February 12, 1997.

On December 18, 1996, the Pacific

Stock Exchange, Inc. (‘‘PSE’’ or

‘‘Exchange’’) submitted to the Securities

and Exchange Commission

(‘‘Commission’’), pursuant to Section

19(b)(1) of the Securities Exchange Act

of 1934 (‘‘Act’’) 1 and Rule 19b–4

thereunder,2 a proposed rule change to

codify certain existing procedures

relating to a.m.-settled index options.

Notice of the proposed rule change

was published for comment in the

Federal Register on January 14, 1997.3

No comments were received on the

proposal. This order approves the

proposal.

I. Description

The Exchange proposes to adopt new

Rule 7.8(e), entitled ‘‘A.M.-Settled Index

Options.’’ This rule provides that the

last day of trading for A.M.-settled index

option shall be the business day

preceding the last day of trading in the

underlying securities prior to

expiration. It states that the current

index value at the expiration of an A.M.-

settled option shall be determined on

the last day of trading in the underlying

securities prior to expiration. It further

provides that the current index value

shall be determined by reference to the

reported level of such index is derived

from first reported sale (opening) prices

of the underlying securities on such

day. In addition, in any case where the

security does not open for trading on

that day, the last reported sale price of

such security shall be used unless the

exercise settlement amount is fixed in

accordance with the Rules and By-Laws

of The Options Clearing Corporation.

Subsection (1)(B) of the proposed rule

further states that in any case where an

exercise settlement amount is fixed for

any series of index options pursuant to

the Rules and By-Laws of The Options

Clearing Corporation, the amount so

fixed shall be the amount required to be

paid upon exercise of options of that

series notwithstanding any difference

between the current index value used by

The Options Clearing Corporation in

fixing that amount and the index value

determined pursuant to Exchange Rules

or practices.

The rule change further states that the

following A.M.-settled index options are

approved for trading on the Exchange:

the PSE Technology Index; the Wilshire

Small Cap Index, and the Dow Jones &

Co. Taiwan Index.

II. Discussion

After careful review, the Commission

finds that the proposed rule change is

consistent with the requirements of the

Act and the rules and regulations

thereunder applicable to a national

securities exchange, and, in particular,

with the requirements of Section 6(b).4

Specifically, the proposal clarifies

procedures for determining the current

index value of A.M.-settled index

options by conforming PSE’s rules and

practices regarding these products to the

current rules and practices of The
8072 Federal Register / Vol. 62, No. 35 / Friday, February 21, 1997 / Notices

5 15 U.S.C. § 78(b)(5).

6 In approving these rules, the Commission has

considered the proposed rules’ impact on

efficiency, competition, and capital formation. 15

U.S.C. § 78c(f).

7 15 U.S.C. § 78s(b)(2).

8 17 CFR 200.30–3(a)(12).

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

2The Commission has modified the text of the

summaries prepared by PTC.

3Letter from William A. Wiles, Secretary of the

Board, Board of Governors, to Thomas A. Williams,

Milbank, Tweed, Hadley & McCloy (March 27,

1989).

4Letter from Jennifer J. Johnson, Associate

Secretary, to the Board, Board of Governors, to

Leopold S. Rassnick, Vice President and General

Counsel, PTC (June 9, 1992)

5Securities Exchange Act Release No. 31746

(January 15, 1993), 58 FR 6319 [File No. SR–PTC–

92–15].

6 Id.

7Securities Exchange Act Release No. 33487

(January 18, 1994), 59 FR 3900 [File No. SR–PTC–

93–07].

8Securities Exchange Act Release No. 35205

(January 9, 1995), 59 FR 3444 [File No. SR–PTC–

94–08].

9Securities Exchange Act Release No. 36790

(January 30, 1996), 61 FR 4507 [File No. SR–PTC–

95–09].

10The 90-day United States Treasury bill rate, as

published in The Wall Street Journal on December

19, 1996, was 5.00%.

11 15 U.S.C. 78q–1(b)(3)(D).

Options Clearing Corporation and the

other exchanges. Thus, the Commission

believes that the proposal is consistent

with the Section 6(b)(5) 5 requirements

that the rules of an exchange be

designed to promote just and equitable

principles of trade, to prevent

fraudulent and manipulative acts, and,

in general, to protect investors and the

public, in that it will foster cooperation

and coordination with persons engaged

in regulating, clearing, selling and

processing information with respect to

transactions in securities.6

III. Conclusion

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,7 that the

proposed rule change (SR–PSE–96–48)

be, and hereby is, approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.8

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–4233 Filed 2–20–97; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–38280; FIle No. SR–PTC–

96–09]

Self-Regulatory Organizations,

Participants Trust Company; Notice of

Filing and Immediate Effectiveness of

Proposed Rule Change Declaring a

Dividend

February 12, 1997.

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

Securities Exchange Act of 1934

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

December 23, 1996, the Participants

Trust Company (‘‘PTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change (File No. SR–PTC–96–09) as

described in Items I, II, and III below,

which Items have been prepared

primarily by PTC. 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 proposed rule change declares a

dividend payable on January 21, 1997,

to PTC’s stockholders of record as of

December 31, 1996.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission, PTC

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. PTC has prepared

summaries, set forth in sections (A), (B),

and (C) below, of the most significant

aspects of such statements.2

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

As a condition to approving PTC’s

application for stock in the Federal

Reserve Bank of New York, the Board of

Governors of the Federal Reserve

System (‘‘Board of Governors’’)

prohibited PTC from paying dividends

to its stockholders.3 The Board of

Governors subsequently relieved PTC of

the restriction on payment of dividends

with the understanding that dividends,

if declared, would be declared

periodically by PTC’s Board of Directors

and would be paid at a rate not to

exceed the 90-day United States

Treasury bill rate in effect at the time

the dividend is declared.4

The Commission approved PTC’s

practice of paying dividends out of net

profits subject to the limitations

imposed by the Board of Governors and

subject to the limitations imposed by

the Board of Governors and subject to

the further requirements that (i) prior to

using excess income from invested

principal and interest (‘‘P&I’’) to pay a

dividend, PTC’s Board of Directors be

advised of any amount related to the

investment of P&I which has not been

rebated and is part of the net profits

used to declare the dividend and

affirmatively approve the application of

such excess P&I income for the dividend

and (ii) PTC file a proposed rule change

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

Act each time it declares a dividend.5

PTC has paid dividends on January

18, 1993, in the amount of $.52 per

share to stockholders of record as of the

close of business on December 31,

1992,6 on January 20, 1994, in the

amount of $.525 per share to

stockholders of record as of the close of

business on December 31, 1993,7 on

January 20, 1995, in the amount of $1.00

per share to stockholders of record as of

the close of business on December 31,

1994,8 and on December 29, 1995, in the

amount of $.98 per share to stockholders

of record as of the close of business on

December 21, 1995.9 At its meeting on

December 19, 1996, PTC’s Board of

Directors declared a dividend payable

on January 21, 1997, in the amount of

$.98 per share to stockholders of record

as of the close of business on December

31, 1996. This dividend rate does not

exceed the 90-day United States

Treasury bill rate in effect on December

19, 1996.10 The dividend does not

include any excess income attributable

to investments of P&I as all such P&I

related income with respect to fiscal

year ended December 31, 1996, will be

rebated to participants on a pro rata

basis based on the amount of P&I

disbursements to each participant.

PTC believes that the proposed rule

change is consistent with Section

17A(b)(3)(D) of the Act 11 and the rules

and regulations thereunder in that it

provides for the equitable allocation of

reasonable fees and other charges among

participants.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

PTC does not believe that the

proposed rule change will impose any

burden on competition 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

PTC has not solicited comments with

respect to the proposed rule change, and

none have been received.