2418 Federal Register / Vol. 60, No. 5 / Monday, January 9, 1995 / Notices

4Rule 823 also demonstrates the ‘‘five day

delivery plan’’ by stating that a transaction that

occurs on Monday will settle on the Monday of the

following week. This language will be changed to

be consistent with the ‘‘three day delivery plan.’’

the contract. ‘‘Fifth’’ will be changed to

‘‘third.’’

Rule 291 requires, unless otherwise

agreed, securities loaned to be delivered

on the fifth business day following the

day of the loan. ‘‘Fifth’’ will be changed

to ‘‘third.’’ Rule 294 will be amended to

change the return date for securities

loaned from the fifth full business day

following the date the notice is given to

the third full business day.

Rule 362 will require the contract

price of bonds dealt in ‘‘and interest’’

and made ‘‘regular way delayed

delivery’’ to include interest computed

only up to but not including the third

business day rather than the fifth

business day following the day of the

contract. Rule 371(a) states that with

‘‘delayed delivery’’ contracts in bonds

dealt in ‘‘and interest’’ made prior to the

fifth business day preceding the interest

payment date for delivery on or after the

interest payment date, there will be a

cash adjustment for coupons paid. The

rule will be changed to prior to the third

business day preceding the interest

payment date. Similarly, Rule 371(b)

will require that ‘‘seller’s option’’

contracts in bonds dealt in ‘‘and

interest’’ made prior to the third

business day, instead of the fifth

business day, preceding the interest

payment date for delivery on or after the

payment date will have a cash

adjustment for coupons paid.

Rule 431 states that transactions

(except those made for ‘‘cash’’) shall be

ex-dividend or ex-rights on the fourth

business day preceding the record date.

This will be changed to the second

business day. With regard to a record

date on other than a business day, the

transaction shall be ex-dividend or exrights on the third preceding business

day rather than on the fifth preceding

business day. Rule 432 prescribes when

ex-warrant trading will begin. The exwarrant period will be changed from the

fourth business day preceding date of

expiration of warrants to the second

business day. When warrant expiration

occurs on a day other than a business

day, the ex-warrant period will be

changed from fifth business day

preceding expiration date to third

business day.

Rule 823 requires that all transactions

effected on the PHLX will be settled

pursuant to the ‘‘five day delivery plan’’

which requires regular way transactions

to settle on the fifth business day after

the transaction date. The proposed rule

change will change all references from

five to three.4

Rule 825(b) provides that the exdividend date for transactions in stock

for which there exists a transfer facility

in Philadelphia is the fourth business

day preceding the record date. The

reference to fourth business day will be

changed to second business day. In the

event the record date is not a business

day, the ex-dividend date will be

changed from the fifth preceding

business day to the third preceding

business day. Rule 825(c) establishes the

equivalent ex-dividend record date for

those stocks with transfer facilities

outside Philadelphia. For these stocks,

the ex-dividend date will be the second

business day, instead of the fourth

business day, preceding the equivalent

Philadelphia record date.

The PHLX’s implementation of these

rule changes will be consistent with the

June 1995 conversion schedule which

the Stock Clearing Corporation of

Philadelphia and National Securities

Clearing Corporation have developed for

industry use. The schedule is as follows:

Trade date

Settlement

cycle

Settlement date

June 2 Friday ..... 5 Day June 9 Friday.

June 5 Monday .. 4 Day June 9 Friday.

June 6 Tuesday . 4 Day June 12 Monday.

June 7 Wednesday.3 Day June 12 Monday.

If the Commission determines to alter

the exemptions currently provided in

Rule 15c6–1, the PHLX may need to

submit additional rule amendments. It

is intended that the proposed rule

change will become effective the same

date as Commission Rule 15c6–1.

The proposed rule change is

consistent with Section 6(b)(5) of the

Act in that it protects investors and the

public interest by reducing the risk to

clearing corporations, their members,

and public investors which is inherent

in settling securities transactions. This

is accomplished by reducing the time

period for settlement of most securities

transactions which will correspondingly

decrease the number of unsettled trades

in the clearance and settlement system

at any given time.

The proposed change also is

consistent with Commission Rule 15c6–

1 which will require brokers or dealers

to settle most securities transactions no

later than the third business day after

the date of the contract unless otherwise

expressly agreed to by the parties at the

time of the transaction.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

The PHLX does not believe that the

proposed rule change will impose any

inappropriate 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 either

solicited or 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 or such date if it finds such

longer period to be appropriate and

publishes its reasons for so finding or

(ii) as to which the PHLX 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 also will be available for

inspection and copying at the principal

office of the PHLX. All submissions

should refer to File No. SR–Phlx–94–55

and should be submitted by January 30,

1995.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–383 Filed 1–6–95; 8:45 am]

BILLING CODE 8010–01–M