Federal Register / Vol. 60, No. 85 / Wednesday, May 3, 1995 / Notices 21839

1Amendment No. 1 made non-substantive,

clarifying changes to the proposal. See Letter from

James E. Buck, Senior Vice President and Secretary,

NYSE, to Glen Barrentine, Team Leader, SEC dated

April 17, 1995.

2A LOC order is a limited price order entered for

execution at the closing price if the closing price

is within the limit specified. See Securities

Exchange Act Release No. 33706 (March 3, 1994),

59 FR 111093.

3A MOC order is a market order to be executed

in its entirety at the closing price on the Exchange.

See NYSE Rule 13.

deducted from any payment does not

exceed the proportionate amount

deducted from any prior payment. This

general proviso holds true unless the

increase in sales load deduction is

caused by reductions in the annual cost

of insurance or reductions in sales load

for amounts transferred to a variable life

insurance policy from another plan of

insurance. Applicants represent that

neither exception applies in the present

case.

4. Subsection (d)(1) of Rule 6e–3(T)

provides relief similar to that provided

by subsection (b)(13)(ii), but for sales

charges deducted from other than

premiums, and provided that the sales

load deducted pursuant to any method

permitted thereunder does not exceed

the proportionate amount of sales load

deducted prior thereto pursuant to the

same method. Applicants represent that

the express language of subsection

(d)(1)(ii)(A) prohibits the actual

deduction of proportionately greater

amounts.

5. Applicants represent that although

the Rider causes the Surrender Charge

to increase over a limited period of time,

the actual amount of the Surrender

charge deducted in connection with the

IL 2000 Series and the IL Plus Series

never is proportionately greater than

any Surrender Charge deducted prior

thereto, because either: (a) There has

been no prior Surrender Charge

deduction; or (b) the prior deduction

resulted from a face amount decrease to

which the Rider does not apply, with

the result that the Surrender Charge

percentages applicable to the decrease

are the higher percentages specified in

the Policy.

6. Applicants state that, unlike under

the IL 2000 Series and the IL Plus

Series, however, under the COLI Series,

the Rider applies to amounts of

Surrender Charges imposed upon

decreases in the face amount. Therefore,

the effective rate of a Surrender Charge

imposed upon a decrease in the face

amount under the COLI Series during

the first five Policy years may be lower

than the Surrender Charge applicable to

a later decrease in the face amount,

surrender, or termination of a Policy.

Applicants represent that this

phenomenon results solely from the fact

that the Rider—which is beneficial to

policyowners—applies to decreases in

face amount (as well as surrenders and

Policy termination) under the COLI

Series.

7. Applicants assert that Section

27(a)(3), in conjunction with the other

sales charge limitations in the 1940 Act,

was designed to address the perceived

abuse of periodic payment plan

certificates that deducted large amounts

of front-end sales charges so early in the

life of the plan that an investor

redeeming in the early periods would

recoup little of his or her investment.

Applicants contend that waiver of an

amount of Surrender Charge otherwise

payable under the Policy upon

surrender through operation of the Rider

does not present the abuses addressed

in Section 27(a)(3); indeed, operation of

the Rider could further the purposes of

the 1940 Act.

8. Applicants also assert that one

purpose behind Section 27(h)(3) of the

1940 Act, a provision similar to Section

27(a)(3), is to discourage unduly

complicated sales charges. Applicants

submit that this also may be deemed to

be a purpose of Section 27(a)(3) and

subsections (b)(3)(ii) and (d)(1) of Rule

6e–3(T). Applicants submit that the

variation to the Policies’ sales charge

structure effected by the Rider is

relatively straightforward and easily

understood, as compared to that of

many other variable life insurance

Policies currently being offered.

Moreover, Applicants represent that

eligible policyowners will benefit from

the sales charge structure effected by the

Rider, and that the prospectuses for the

Policies, or supplements thereto, will

contain disclosure informing

prospective eligible policyowners of the

effect of the Rider on the sales charges

under the Policies.

Applicants’ Conclusion

Applicants submit that, for the

reasons and based upon the facts set

forth above, the requested exemptions

from Section 27(a)(3) of the 1940 Act

and subsections (b)(13)(ii) and

(d)(1)(ii)(A) of Rule 6e–3(T) under the

1940 Act—to permit Equitable Variable

to make a Rider available under the

Policies—meet the standards of Section

6(c) of the 1940 Act. In this regard,

Applicants submit that the exemptions

are necessary or appropriate in the

public interest and consistent with the

protection of investors and the purposes

fairly intended by the policies and

provisions of the 1940 Act.

For the Commission, by the Division of

Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–10797 Filed 5–2–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–35653; File No. SR–NYSE–

95–09]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the New York Stock Exchange, Inc.

Relating to Entry of Limit-at-the-Close

Orders

April 27, 1995.

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

Securities Exchange Act of 1934

(‘‘Act’’), 15 U.S.C. 78s(b)(1), notice is

hereby given that on March 3, 1995, the

New York Stock Exchange, Inc.

(‘‘NYSE’’ or ‘‘Exchange’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’ or ‘‘SEC’’) the proposed

rule change, and on April 18, 1995, filed

Amendment No. 1 to the proposed rule

change,1 as described in Items I, II and

III below, which Items have been

prepared by the self-regulatory

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 proposed rule change would

provide for a one-year pilot for the entry

of limit-at-the-close (‘‘LOC’’) orders 2 to

offset a market-at-the-close (‘‘MOC’’)

order 3 imbalance of 50,000 shares or

more in all stocks for which MOC order

imbalances are published.

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.
21840 Federal Register / Vol. 60, No. 85 / Wednesday, May 3, 1995 / Notices

4The term ‘‘expiration days’’ refers to both (1) the

trading day, usually the third Friday of the month,

when some stock index options, stock index futures

and options on stock index futures expire or settle

concurrently (‘‘Expiration Fridays’’) and (2) the

trading day on which end of calendar quarter index

options expire (‘‘QIX Expiration Days’’).

5The Expiration Friday pilot stocks consist of the

50 most highly capitalized Standard & Poors

(‘‘S&P’’) 500 stocks and any component stocks of

the Major Market Index (‘‘MMI’’) not included

therein. The QIX Expiration Day pilot stocks consist

of the 50 most highly capitalized S&P 500 stocks,

any component stocks of the MMI not included

therein and the 10 highest weighted S&P Midcap

400 stocks.

6See Securities Exchange Act Release No. 33706

(March 3, 1994), 59 FR 11093.

7Currently, MOC imbalances are published for

pilot stocks on expiration days and non-expiration

days. In addition, on non-expiration days, MOC

imbalances are published for stocks that are being

added to or dropped from an index and, upon the

request of a specialist, any other stock with the

approval of a Floor Official. See Securities

Exchange Act Release No. 35589 (April 10, 1995),

60 FR 19313.

8 Given the limited use of the LOC order type in

the current pilot for five stocks, the Exchange

proposes that the existing pilot be replaced with the

one year pilot for LOCs in all stocks proposed

herein.

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The purpose of the proposed rule

change is to expand the universe of

stocks in which LOC orders may be

entered to all stocks for which MOC

imbalances are published pursuant to

such procedures regarding time of order

entry and order cancellation as the

Exchange may establish from time to

time. The Exchange intends to keep the

3:55 p.m. cutoff time for the entry of

LOC orders, except to correct a bona

fide error. On expiration days,4 LOC

orders will continue to be irrevocable

after 3:40 p.m., except to correct a bona

fide error. For non-expiration days,

cancellation of LOC orders would be

prohibited after 3:55 p.m., except to

correct errors.

In SR–NYSE–92–37, the Exchange

filed a proposed amendment to

Exchange Rule 13 to provide that LOC

orders may be entered to offset

published imbalances of MOC orders of

50,000 shares or more in stocks selected

from the expiration day pilot stocks.5

The Commission approved this proposal

on a 15-month pilot basis through July

15, 1995.6

The LOC pilot currently consists of

only five of the expiration day ‘‘pilot

stocks.’’ Thus far, the LOC order type

has been used rarely. Members cite the

limited number of stocks for which this

order type may be entered as a primary

reason for not committing resources to

effect system program changes

necessary to support this order type.

The Exchange believes that by

expanding the universe of eligible LOC

stocks, the Exchange will make it more

feasible for member firms to effect the

systems changes required to use this

order type. The Exchange is therefore

proposing to expand the pilot to permit

the entry of LOC orders to offset a MOC

order imbalance of 50,000 shares or

more in all stocks for which MOC order

imbalances are published.7

The Exchange believes that the LOC

order type may be a useful means to

help address the prospect of excess

market volatility that may be associated

with an imbalance of MOC orders at the

close. Therefore, the Exchange believes

it is appropriate to expand the current

pilot for LOC orders to all stocks for

which MOC imbalances are published

and to extend the pilot for LOC orders

one year from the date of approval of

this proposed rule change.8

2. Statutory Basis

The basis under the Act for this

proposed rule change is the requirement

under Section 6(b)(5) that an Exchange

have rules that are designed 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. The proposed rule

change perfects the mechanism of a free

and open market by providing investors

with the ability to use LOC orders as a

vehicle for managing risk at the close.

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 that is not

necessary or appropriate in furtherance

of the proposes of the Act.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

The Exchange has neither solicited

nor received written comments on the

proposed rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Within 35 days of the publication of

this notice in the Federal Register or

within such other 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 the 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 date, 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, NW.,

Washington, DC 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

Section, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of the NYSE. All submissions

should refer the File No. SR–NYSE–95–

09 and should be submitted by May 24,

1995.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–10853 Filed 5–2–95; 8:45 am]

BILLING CODE 8010–01–M

SMALL BUSINESS ADMINISTRATION

[Declaration of Disaster Loan Area #2769]

Oklahoma; Declaration of Disaster

Loan Area

As a result of the President’s major

disaster declaration on April 26, 1995,

I find that Oklahoma County in the State

of Oklahoma constitutes a disaster area

due to damages caused by an explosion

at the Alfred P. Murrah Federal Building

in Oklahoma City on April 19, 1995.

Applications for loans for physical

damages may be filed until the close of

business on June 24, 1995, and for loans

for economic injury until the close of

business on January 26, 1996, at the

address listed below:

U.S. Small Business Administration,

Disaster Area 3 Office, 4400 Amon