Federal Register / Vol. 60, No. 111 / Friday, June 9, 1995 / Notices 30615

5The issuer will not attempt to find a

replacement stock or compensate for the extinction

of a security due to bankruptcy or a similar event. 6 17 CFR 200.30–3(a) (12) (1994).

numerical Index value and at least 80%

of the total number of component

securities will meet the then current

criteria for standardized options trading

set forth in Exchange Rule 915; and (4)

all component stocks will (i) either be

listed on the Amex, the New York Stock

Exchange, or will be National Market

securities traded through the facilities of

Nasdaq and (ii) be subject to last sale

reporting pursuant to Rule 11Aa–3 of

the Act.

Index Calculation

The Index will be calculated using an

‘‘equal dollarweighting’’ methodology

designed to ensure that each of the

component securities is represented in

an approximately equal dollar amount

in the Index at the time the Notes are

issued. To create the Index, a portfolio

of the securities comprising the Index

will be established by the issuer

representing an investment of a

specified dollar amount in each

component security (rounded to the

nearest whole share). The value of the

Index will equal the current market

value of the sum of the assigned number

of shares of each of the component

securities divided by the current Index

divisor. The Index divisor will initially

be set to provide a benchmark value of

100.00 at the close of trading on the day

preceding the issuance of the Notes.

The number of shares of each

component stock in the Index will

remain fixed except in the event of

certain types of corporate actions such

as the payment of a dividend (other than

an ordinary cash dividend), a stock

distribution, stock split, reverse stock

split, rights offering, distribution,

reorganization, recapitalization, or

similar event with respect to the

component securities. The number of

shares of each component security may

also be adjusted, if necessary, in the

event of a merger, consolidation,

dissolution, or liquidation of an issuer

or in certain other events such as the

distribution of property by an issuer to

shareholders. Shares of a component

security may be replaced (or

supplemented) with other securities

under certain circumstances, such as the

conversion of a component stock into

another class of security, or the spin-off

of a subsidiary. If the security remains

in the Index, the number of shares of

that security may be adjusted, to the

nearest whole share, to maintain the

component’s relative weight in the

Index at the level immediately prior to

the event(s) discussed above.5 In all

cases, the divisor will be adjusted, if

necessary, to ensure continuity of the

value of the Index. In the event that a

security in the Index is canceled due to

a corporate consolidation and the

holders of such security receive cash,

the cash value of that security will be

included in the Index and will accrue

interest at LIBOR to term, compounded

daily.

The value of the Index will be

calculated continuously by the Amex

and disseminated every 15 seconds over

the Consolidated Tape Association’s

Network B.

Payment at Maturity

The Notes will provide for a single

payment at maturity, i.e., there will be

no periodic interest payments. The

Notes will entitle the holder, upon

maturity, to receive an amount based

upon the percentage change between the

‘‘original portfolio value’’ and the

‘‘average portfolio value,’’ provided,

however that the amount payable at

maturity will not be less than 90% of

the principal amount of the Notes. The

‘‘original portfolio value’’ is the closing

level of the Index on the day

immediately preceding the issuance of

the Notes. The ‘‘average portfolio value’’

is the average of the closing values of

the Index on the last trading day of each

of the last 30 months of the term of the

Notes.

The Exchange believes that the

proposed rule change is consistent with

Section 6(b) of the Act, in general, and

furthers the objectives of Section 6(b)(5)

in particular, in that it is designed to

prevent fraudulent and manipulative

acts and practices, to promote just and

equitable principles of trade, to foster

cooperation and coordination with

persons engaged in facilitating

transactions in securities, and to remove

impediments to and perfect the

mechanism of a free and open market

and a national market system.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

The Amex 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 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 35 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 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. Copies of such filing

will also be available for inspection and

copying at the principal office of the

Amex. All submissions should refer to

File No. SR–Amex–95–20 and should be

submitted by June 30, 1995.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.6

Jonathan G. Katz,

Secretary.

[FR Doc. 95–14192 Filed 6–8–95; 8:45 am]

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