[Federal Register Volume 66, Number 105 (Thursday, May 31, 2001)]
[Notices]
[Pages 29613-29617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-13634]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-44342; File No. SR-Amex-2001-28]


Self Regulatory Organizations; Notice of Filing and Order 
Granting Accelerated Approval of a Proposed Rule Change by the American 
Stock Exchange LLC Relating to the Listing and Trading of Select Ten 
Notes

May 23, 2001.
    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 May 7, 2001, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been prepared by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons and is approving the 
proposal on an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The Amex proposes to list and trade notes, the return on which is 
based upon an equal-dollar weighted portfolio of securities 
representing the ten highest dividend yielding stocks in the Dow Jones 
Industrial Average (``DJIA'') from year to year (the ``Select Ten 
Index'' or ``Index'').\3\
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    \3\ The initial portfolio of securities comprising the Select 
Ten Index for the first year will be the highest dividend yielding 
stocks as of May 1, 2001, and are as follows: Philip Morris Co., 
Inc.; Eastman Kodak Co.; General Motors Corp.; DuPont El De Nemours; 
J.P. Morgan Chase & Co.; Caterpillar Inc.; International Paper Co.; 
SBC Communications, Inc.; Proctor & Gamble Co.; and Minnesota Mining 
& Manufacturing Co. The portfolio of securities will include the ten 
highest dividend yielding stocks in the DJIA for that year and the 
Amex will not have any discretion in the selection process.
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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 Amex 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 III below. The Exchange 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 107A of the Amex Company Guide (``Company Guide''), 
the Exchange may approve for listing and trading securities which 
cannot be readily categorized under the listing criteria for common and 
preferred stocks, bonds, debentures, or warrants.\4\ The Amex proposes 
to list for trading under section 107A of the Company Guide notes based 
on the Select Ten Index (the ``Select Ten Notes'' or ``Notes''). The 
Select Ten Index will be determined, calculated and maintained solely 
by the Amex.\5\
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    \4\ See Securities Exchange Act Release No. 27753 (March 1, 
1990), 55 FR 8626 (March 8, 1990) (order approving File No. SR-Amex-
89-29).
    \5\ Subject to the criteria in the prospectus regarding the 
construction of the Index, the Exchange has sole discretion 
regarding changes to the Index due to annual reconstitutions and 
adjustments to the Index and the multipliers of the individual 
components.
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    The Select Ten Notes will conform to the initial listing guidelines 
under Section 107 \6\ and continued listing guidelines under sections 
1001-1003 \7\

[[Page 29614]]

of the Company Guide. Select Ten Notes are senior non-convertible debt 
securities of Merrill Lynch & Co., Inc. (``Merrill Lynch'') that 
provide for a single payment at maturity. The Select Ten Notes will 
have a term of not less than one, nor more than ten, years. Select Ten 
Notes will entitle the owner at maturity to receive an amount based 
upon the percentage change between the ``Starting Index Value'' and the 
``Ending Index Value'' (the ``Redemption Amount''). The ``Starting 
Index Value'' is the value of the Select Ten Index on the date on which 
the issuer prices the Select Ten Notes issue for the initial offering 
to the public. The ``Ending Index Value'' is the value of the Select 
Ten Index over a period shortly prior to the expiration of the Select 
Ten Notes. The Ending Index Value will be used in calculating the 
amount owners will receive upon maturity. The Select Ten Notes may not 
have a minimum principal amount that will be repaid and, accordingly, 
payments on the Notes prior to or at maturity may be less than the 
original issue price of the Select Ten Notes. During the designated 
month each year, the investors may have the right to require the issuer 
to repurchase the Select Ten Notes at a redemption amount based on the 
value of the Select Ten Index at such repurchase date. Select Ten Notes 
are not callable by the issuer.
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    \6\ The initial listing standards for Select Ten Notes require: 
(1) A minimum public distribution of one million units; (2) a 
minimum of 400 shareholders; (3) a market value of at least $4 
million; and (4) a term of at least one year. In addition, the 
listing guidelines provide that the issuer have assets in excess of 
$100 million, stockholder's equity of at least $10 million, and pre-
tax income of at least $750,000 in the last fiscal year or in two of 
the three prior fiscal years. In the case of an issuer which is 
unable to satisfy the earning criteria stated in Section 101 of the 
Company Guide, the Exchange will require the issuer to have the 
following: (1) Assets in excess of $200 million and stockholders' 
equity of at least $10 million; or (2) assets in excess of $100 
million and stockholder's equity of at least $20 million.
    \7\ The Exchange's continued listing guidelines are set forth in 
Sections 1001 through 1003 of Part 10 to the Exchange's Company 
Guide. Section 1002(b) of the Company Guide states that the Exchange 
will consider removing from listing any security where, in the 
opinion of the Exchange, it appears that the extent of public 
distribution or aggregate market value has become so reduced to make 
further dealings on the Exchange inadvisable. With respect to 
continued listing guidelines for distribution of the Select Ten 
Notes, the Exchange will rely, in part, on the guidelines for bonds 
in Section 1003(b)(iv). Section 1003(b)(iv)(A) provides that the 
Exchange will normally consider suspending dealings in, or removing 
from the list, a security if the aggregate market value or the 
principal amount of bonds publicly held is less than $400,000.
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    Select Ten Notes are cash-settled in U.S. dollars and do not give 
the holder any right to receive a portfolio security or any other 
ownership right or interest in the portfolio securities, although the 
return on the investment is based on the aggregate portfolio value of 
the Select Ten Index securities.
    The Select Ten Index will consist of the ten stocks with the 
highest dividend yields among the thirty stocks that comprise the DJIA, 
adjusted as described below. The Index will be composed and calculated 
in a similar manner as the Top Ten Yield Index previously approved by 
the Commission.\8\
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    \8\ See Securities Exchange Act Release No. 37533 (August 7, 
1996), 61 FR 42075 (August 13, 1996) (order granting accelerated 
approval to File No. SR-Amex-96-28).
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    Components of the Select Ten Index approved pursuant to this filing 
will meet the following criteria: (1) A minimum market value of at 
least $75 million, except that up to 10% of the component securities in 
the Select Ten Index may have a minimum market value of $50 million; 
(2) average monthly trading volume in the last six months of not less 
than 1,000,000 shares, except that up to 10% of the component 
securities in the Select Ten Index may have an average monthly trading 
volume of 500,00 shares or more in the last six months; (3) 90% of the 
Select Ten Index's numerical value and at least 80% of the total number 
of component securities will meet the then current criteria for 
standardized option trading set forth in Exchange Rule 915; and (4) all 
component stocks will either be listed on the Amex, the New York Stock 
Exchange, Inc. (``NYSE''), or traded through the facilities of the 
National Association of Securities Dealers Automated Quotation System 
(``NASDAQ'') and reported National Market System securities.
    As of May 1, 2001, the market capitalization of the initial 
portfolio of securities representing the Select Ten Index ranged from a 
high of $145 billion to a low of $12.8 billion. The average monthly 
trading volume for the last six months, as of the same date, ranged 
from a high of 188 million shares to a low of 34 million shares. 
Moreover, as of May 1, 2001, all of the components comprising the 
initial portfolio of securities representing the Select Ten Index were 
eligible for standardized options trading pursuant to Amex Rule 915.
    At the outset, each of the securities in Select Ten Index will 
represent approximately an equal percentage of the starting value of 
the Select Ten Index. Specifically, each security included in the 
portfolio will be assigned a multiplier on the date of issuance so that 
the security represents approximately an equal percentage of the value 
of the entire portfolio on the date of issuance. The multiplier 
indicates the number of shares (or fraction of one share) of a 
security, given its market price on an exchange or through NASDAQ, to 
be included in the calculation of the portfolio. Accordingly, initially 
each of the ten companies included in the Select Ten Index will 
represent approximately ten percent of the total portfolio at the time 
of issuance. The Select Ten Index will initially be set to provide a 
benchmark value of 100.00 at the close of trading on the day the Select 
Ten Notes are priced for initial sale to the public.
    The value of the Select Ten Index at any time will equal: (1) The 
sum of the products of the current market price for each stock 
underlying the Select Ten Index and the applicable share multiplier, 
plus (2) an amount reflecting current calendar quarter dividends, and 
less (3) a pro rata portion of the annual index adjustment factor.\9\ 
Current quarter dividends for any day will be determined by the Amex 
and will equal the sum of each dividend paid by the issuer on one share 
of stock during the current calendar quarter multiplied by the share 
multiplier applicable to such stock on the ex-dividend date.
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    \9\ At the end of each day, the Index will be reduced by a pro 
rata portion of the annual index adjustment factor, 1.5% (i.e., 
1.5%/365 days = 0.0041% daily). Telephone conversation between 
Jeffrey P. Burns, Senior Counsel, Amex, and Sapna C. Patel, 
Attorney, Division of Market Regulation, Commission, on May 22, 
2001. This reduction to the value of the Index will reduce the total 
return to investors upon redeeming Select Ten Notes at maturity. The 
Amex represents that an explanation of this deduction will be 
included in any marketing materials, fact sheets, or any other 
materials circulated to investors regarding the trading of this 
product.
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    As of the first day of the start of each calendar quarter, the Amex 
will allocate the current quarter dividends as of the end of the 
immediately preceding calendar quarter to each then outstanding 
components of the Select Ten Index. The amount of the current quarter 
dividends allocated to each stock will equal the percentage of the 
value of such stock contained in the portfolio of securities comprising 
the Select Ten Index relative to the value of the entire portfolio 
based on the closing market price of such stock on the last day in the 
immediately preceding calendar quarter. The share multiplier of each 
stock will be increased to reflect the number of shares, or portion of 
a share, that the amount of the current quarter dividend allocated to 
each stock can purchase of each stock based on the closing market price 
on the last day in the immediate preceding calendar quarter.
    As of the close of business on each anniversary date (anniversary 
of the date of the initial issuance of Select Ten Notes) through the 
applicable anniversary date in the year preceding the maturity of the 
Select Ten Notes, the portfolio of securities comprising the Select Ten 
Index will be reconstituted by the Amex so as to include the ten common 
stocks in the DJIA having the highest dividend yield on the second 
scheduled index business day prior to such anniversary date. The 
Exchange will announce such changes to investors

[[Page 29615]]

at least one day prior to the anniversary date.\10\
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    \10\ The Exchange will publish a notice to advise investors of 
changes to the securities underlying the Index if any such changes 
are made following an annual reconstitution.
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    The portfolio will be reconstituted and rebalanced on the 
anniversary date so that each stock in the Select Ten Index will 
represent 10% of the value of the Index. To effectuate this, the share 
multiplier for each new stock will be determined by the Amex and will 
indicate the number of shares or fractional portion thereof of each new 
stock, given the closing market price of such new stock on the 
anniversary date, so that each new stock represents an equal percentage 
of the Select Ten Index value at the close of business on such 
anniversary date. For example, if the Select Ten Index value at the 
close of business on an anniversary date was 200, then each of the ten 
new stocks comprising the Select Ten Index would be allocated a portion 
of the value of the Index equal to 20, and if the closing market price 
of one such new stock on the anniversary date was 40, the applicable 
share multiplier would be 0.5. Conversely, if the Select Ten Index 
value was 80, then each of the ten new stocks comprising the Select Ten 
Index would be allocated a portion of the value of the Select Ten Index 
equal to 8, and if the closing market price of one such new stock on 
the anniversary was 40, the applicable share multiplier would be 0.2. 
The last anniversary date on which such reconstitution will occur will 
be the anniversary date in the year preceding the maturity of the 
Select Ten Notes. As noted above, investors will receive information on 
the new portfolio of securities comprising the Select Ten Index at 
least one day prior to each anniversary date.
    The multiplier of each component stock in the Select Ten Index will 
remain fixed unless adjusted for quarterly dividend adjustments, annual 
reconstitutions or certain corporate events, such as payment of a 
dividend other than an ordinary cash dividend, a distribution of stock 
of another issuer to its shareholders,\11\ stock split, reverse stock 
split, and reorganization.
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    \11\ If the issuer of a component security in the Select Ten 
Index issues to all of its shareholders publicly traded stock of 
another issuer, such new securities will be added to the portfolio 
comprising the Select Ten Index until the subsequent anniversary 
date. The multiplier for the new component will equal the product of 
the original issuer's multiplier and the number of shares of the new 
component issued with respect to one share of the original issuer.
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    The multiplier of each component stock may 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. If the issuer of 
a stock included in the Select Ten Index were to no longer exist, 
whether by reason of a merger, acquisition or similar type of corporate 
transaction, a value equal to the stock's final value will be assigned 
to the stock for the purpose of calculating the Select Ten Index value 
prior to the subsequent anniversary date. For example, if a company 
included in the Select Ten Index were acquired by another company, a 
value will be assigned to the company's stock equal to the value per 
share at the time the acquisition occurred. If the issuer of stock 
included in the Select Ten Index is in the process of liquidation or 
subject to a bankruptcy proceeding, insolvency, or other similar 
adjudication, such security will continue to be included in the Select 
Ten Index so long as a market price for such security is available or 
until the subsequent anniversary date. If a market price is no longer 
available for an Index stock due to circumstances including but not 
limited to, liquidation, bankruptcy, insolvency, or any other similar 
proceeding, then the security will be assigned a value of zero when 
calculating the Select Ten Index for so long as no market price exists 
for that security or until the subsequent anniversary date. If the 
stock remains in the Select Ten Index, the multiplier of that security 
in the Select Ten Index may be adjusted to maintain the component's 
relative weight in the Select Ten Index at the level immediately prior 
to the corporate action. In all cases, the multiplier will be adjusted, 
if necessary, to ensure Select Ten Index continuity.
    The Exchange will calculate the Select Ten Index and, similar to 
other stock index values published by the Exchange, the value of the 
Index will be calculated continuously and disseminated every fifteen 
seconds over the Consolidated Tape Association's Network B. The Index 
value will equal the sum of the products of the most recently available 
market prices and the applicable multipliers for the component 
securities.
    Because Select Ten Notes are linked to a portfolio of equity 
securities, the Amex's existing equity floor trading rules will apply 
to the trading of Select Ten Notes. First, pursuant to Amex Rule 411, 
the Exchange will impose a duty of due diligence on its members and 
member firms to lean the essential facts relating to every customer 
prior to trading Select Ten Notes.\12\ Second, Select Ten Notes will be 
subject to the equity margin rules of the Exchange.\13\ Third, the 
Exchange, will, prior to trading Select Ten Notes, distribute a 
circular to the membership providing guidance with regard to member 
firm compliance responsibilities (including suitability 
recommendations) when handling transactions in Select Ten Notes and 
highlighting the special risks and characteristics of the Select Ten 
Notes.
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    \12\ Ammex Rule 411 requires that every member, member firm or 
member corporation use due diligence to learn the essential facts 
relative to every customer to every order or account accepted.
    \13\ See Amex Rule 462 and section 107B of the Company Guide.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with section 6 of the Act \14\ in general and furthers the objectives 
of section 6(b)(5) \15\ 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 corporation 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.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(5).
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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

    The Exchange did not receive any written comments on the proposed 
rule change.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether proposed rule 
change is consistent with the Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
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

[[Page 29616]]

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-Amex-2001-28 and should be submitted by June 21, 2001.

IV. Commission's Findings and Order Granting Accelerated Approval 
of Proposed Rule Change

    After careful consideration, 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)(5) 
of the Act.\16\ The Commission finds that this proposal is similar to 
several approved instruments currently listed and traded on the Amex 
and the NYSE.\17\ Accordingly, the Commission finds that the listing 
and trading of Select Ten Notes is consistent with the Act and will 
promote just and equitable principles of trade, foster cooperation and 
coordination with persons engaged in regulating, clearing, settling, 
processing information with respect to, and facilitating transactions 
in securities, and, in general, protect investors and the public 
interest consistent with section 6(b)(5) of the Act.\18\
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    \16\ Id.
    \17\ See Securities Exchange Act Release Nos. 42582 (March 27, 
2000), 65 FR 17685 (April 4, 2000) (accelerated approval order for 
the listing and trading of notes linked to a basket of no more than 
twenty equity securities) (File No. SR-Amex-99-42); 41546 (June 22, 
1999), 64 FR 35222 (June 30, 1999) (accelerated approval order for 
the listing and trading of notes linked to a narrow based index with 
a non-principal protected put option) (File No. SR-Amex-99-15); 
39402 (December 4, 1997), 62 FR 65459 (December 12, 1997) (notice of 
immediate effectiveness for the listing and trading non-principal 
protected commodity preferred securities linked to certain 
commodities indices) (File No. SR-Amex-97-47); 37533 (August 7, 
1996), 61 FR 42075 (August 13, 1996) (accelerated approval order for 
the listing and trading of the Top Ten Yield Market Index Target 
Term Securities (``MITTS'')) (File No. SR-Amex-96-28); 33495 
(January 19, 1994), 59 FR 3883 (January 27, 1994) (accelerated 
approval order for the listing and trading of Stock Upside Note 
Securities) (File No. SR-Amex-93-40); 32840 (September 2, 1993), 58 
FR 47485 (September 9, 1993) (accelerated approval order for the 
listing and trading of MITTS on the NYSE) (File No. SR-NYSE-93-31); 
and 32343 (May 20, 1993), 58 FR 30833 (May 27, 1993) (accelerated 
approval order for the listing and trading on non-principal 
protected notes linked to a single equity security) (File No. SR-
Amex-92-42).
    \18\ 15 U.S.C. 78f(b)(5). 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).
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    Select Ten Notes are not leveraged instruments; however, their 
price will still be derived and based upon the underlying linked 
security. Accordingly, the level of risk involved in the purchase or 
sale of a Select Ten Notes is similar to the risk involved in the 
purchase or sale of traditional common stock. Nonetheless, because the 
final rate of return of a Select Ten Notes is derivatively priced, 
based on the performance of a portfolio of securities, and the 
components of the Select Ten Index are more likely to change each year, 
over the term of the Select Ten Notes, than products previously issued, 
there are several issues regarding the trading of this type of product.
    The Commission notes that the Exchange's rules and procedures that 
address the special concerns attendant to the trading of hybrid 
securities will be applicable to Select Ten Notes. In particular, by 
imposing the hybrid listing standards, suitability, disclosure, and 
compliance requirements noted above, the Commission believes the 
Exchange has addressed adequately the potential problems that could 
arise from the hybrid nature of Select Ten Notes. Moreover, the 
Exchange will distribute a circular to its membership calling attention 
to the specific risks associated with Select Ten Notes.
    In approving the product, the Commission recognizes that the 
components are likely to change each year over the life of the product. 
Nevertheless, the Commission believes that this is acceptable because 
the Amex has clearly stated its guidelines and formula for replacing 
components from a specific group of thirty well-known, and highly 
capitalized securities. Each year, as noted above, the portfolio of 
securities comprising the Select Ten Index will represent the ten 
highest dividend yielding securities in the DJIA. Amex will do the 
calculation for replacements based on a set formula to determine which 
of the DJIA securities will be in the Index for the following year. The 
Commission believes that within these confines the potential frequent 
changes in the components of the Select Ten Index are reasonable and 
will meet the expectation of investors.
    In addition, the Commission notes that the Select Ten Notes are 
non-principal protected. The Notes may not have a minimum principal 
amount that will be repaid and that payments on the Notes prior to or 
at maturity may be less than the original issue price of the Select Ten 
Notes. The Commission also recognizes the during the designated month 
each year, the investors may have the right to require the issuer to 
repurchase the Select Ten Notes at a redemption amount based on the 
value of the Select Ten Index at such repurchase date.
    The Commission notes that Select Ten Notes are dependent upon the 
individual credit of the issuer, Merrill Lynch. To some extent this 
credit risk is minimized by the Exchange's listing standards in Section 
107A of the Company Guide which provide the only issuers satisfying 
substantial asset and equity requirements may issue securities as 
Select Ten Notes. In addition, the Exchange's hybrid listing standards 
further require that Select Ten Notes have at least $4 million in 
market value.\19\ In any event, financial information regarding Merrill 
Lynch, in addition to the information on the issuers of the underlying 
securities comprising the Select Ten Index, will be publicly 
available.\20\
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    \19\ See Company Guide section 107A.
    \20\ The companies that comprise the Select Ten Index are 
reporting companies under the Act.
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    The Commission also has a systemic concern, however, that a broker-
dealer, such as Merrill Lynch, or a subsidiary providing a hedge for 
the issuer will incur position exposure. As discussed in the prior 
approval orders for similar instruments (e.g., the MITTS), the 
Commission believes this concern is minimal given the size of Select 
Ten Notes issuance is relation to the net worth of Merrill Lynch.
    The Commission also believes that the listing and trading of Select 
Ten Notes should not unduly impact the market for the underlying 
securities comprising the Select Ten Index. First, the underlying 
securities comprising the DJIA, from which the Select Ten Index 
components are selected, are well-capitalized, highly liquid stocks. 
Second, because all of the components of the Select Ten Index will be 
equally weighted, initially and immediately following each annual 
reconstitution of the Select Ten Index, no single stock or group of 
stocks will likely dominate the Select Ten Index. Finally, the issues 
of the underlying securities comprising the Select Ten Index, are 
subject to reporting requirements under the Act, and all of the 
portfolio securities are either listed or traded on, or traded through 
the facilities of, U.S. securities markets. Additionally, the Amex's 
surveillance procedures will serve to deter as well as detect any 
potential manipulation.
    Finally, the Commission notes that the value of the Select Ten 
Index will

[[Page 29617]]

be disseminated at least once every fifteen seconds throughout the 
trading day. The Commission believes that providing access to the value 
of the Select Ten Index at least once every fifteen seconds throughout 
the trading day is extremely important and will provide benefits to 
investors in the product.
    The Commission finds good cause for approving the proposed rule 
change prior to the thirtieth day after the date of publication of 
notice thereof in the Federal Register. The Amex has requested 
accelerated approval because this produce is similar to several other 
instruments currently listed and traded on the Amex and the NYSE.\21\ 
In determining to grant the accelerated approval for good cause, the 
Commission notes that the Select Ten Index is a portfolio of highly 
capitalized and actively traded securities similar to hybrid securities 
products that have been approved by the Commission for U.S. exchange 
trading. Additionally, Select Ten Notes will be listed pursuant to 
existing hybrid security listing standards as described below. 
Moreover, the Index's applicable equal-dollar weighting methodology is 
a commonly applied index calculation method. Based on the above, the 
Commission finds, consistent with section 6(b) of the Act,\22\ that 
there is good cause for accelerated approval of the product.
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    \21\ See supra note 17.
    \22\ 15 U.S.C. 78f(b).
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V. Conclusion

    It Is Therefore Ordered, pursuant to section 19(b)(2) of the 
Act,\23\ that the proposed rule change (SR-Amex-2001-28), is hereby 
approved on an accelerated basis.
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    \23\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-13634 Filed 5-30-01; 8:45 am]
BILLING CODE 8010-01-M