[Federal Register Volume 60, Number 244 (Wednesday, December 20, 1995)]
[Notices]
[Pages 65700-65701]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-30911]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36578; File No. SR-Amex-95-48]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the American Stock Exchange, Inc. Relating to Revised Listing 
Standards for Equity-Linked Notes

December 13, 1995.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''), 15 U.S.C. Sec. 78s(b)(1), notice is hereby given that on 
December 5, 1995, the American Stock Exchange, Inc. (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change 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 Amex proposes to amend Section 107B of the Amex Company Guide 
to provide greater flexibility for the listing of Equity-Linked Notes 
(``ELNs'').
    The text of the proposed rule change is available at the Office of 
the Secretary, Amex and at the Commission.

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 IV below. The Amex has prepared summaries, set forth in Sections 
A, B, and C below of the most significant aspects of such statements.

[[Page 65701]]


A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On May 20, 1993 and December 13, 1993, the SEC approved amendments 
to Section 107 of the Amex Company Guide (``Section 107'') to provide 
for the listing and trading of ELNs.\1\ ELNs are intermediate term, 
nonconvertible, hybrid debt instruments, the value of which is linked 
to the performance of a highly capitalized, actively traded U.S. common 
stock (``linked security''). In order to list an ELNs product, Section 
107B currently requires the linked security to meet one of the 
following criteria:

    \1\ See Securities Exchange Act Release Nos. 32345 (May 20, 
1993) and 33328 (Dec. 13, 1993).

------------------------------------------------------------------------
                                                        Annual trading  
      Market capitalization                                 volume      
------------------------------------------------------------------------
$3 billion......................  and...............  2.5 million       
                                                       shares.          
$1.5 billion....................  and...............  20 million shares.
$500 million....................  and...............  80 million shares.
------------------------------------------------------------------------

    Amex now proposes to amend Section 107(B) to provide for greater 
flexibility in the listing criteria for ELNs. The proposed rule change 
will lower the trading volume requirements criteria such that ELNs may 
be listed where the linked security meets one of these revised 
criteria:

------------------------------------------------------------------------
                                                        Annual trading  
     Market  capitalization                                 volume      
------------------------------------------------------------------------
$3 billion......................  and...............  2.5 million       
                                                       shares.          
$1.5 billion....................  and...............  10 million shares.
$500 million....................  and...............  15 million shares.
------------------------------------------------------------------------

    The Exchange believes this revision strikes an appropriate balance 
between the Exchange's responsiveness to innovations in the securities 
markets and its need to ensure the protection of investors and the 
maintenance of fair and orderly markets. Moreover, the Exchange 
believes that these changes will not have an adverse impact on the 
markets for the underlying linked security in view of the requirements 
that the linked security have a large minimum market capitalization and 
a fairly large trading volume over the preceding twelve months. The 
Exchange will continue to require that the issuer have a minimum 
tangible net worth of $150 million and that the total issue price of 
the ELNs combined with all of the issuers's other listed ELNs shall not 
be greater than 25% of the issuer's tangible net worth at the time of 
issuance. The rule change will also delete the current provision of the 
rule that allows the Exchange to list ELNs that do not meet these 
criteria if the Division of Market Regulation of the SEC concurs.
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 prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, 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.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes the proposed rule change will impose no 
burden on competition that is 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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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 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 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 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, 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. Sec. 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 Amex. All 
submissions should refer to File No. SR-Amex-95-48 and should be 
submitted by January 10, 1996.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\2\

    \2\ 17 CFR 200.30-3(a)(12)(1994).
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Jonathan G. Katz,
Secretary.
[FR Doc. 95-30911 Filed 12-19-95; 8:45 am]
BILLING CODE 8010-01-M