33786 Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Notices

1Section 17(b) applies to specific proposed

transactions, rather than an ongoing series of future

transactions. See Keystone Custodian Funds, 21

S.E.C. 295, 298–99 (1945). Section 6(c) frequently

is used to grant relief from section 17(a) to permit

an ongoing series of future transactions.

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

3The Commission notes that Rule 117—the

Exchange’s ‘‘circuit breaker’’ rule—provides that

Portfolios from unexpected large

redemptions.

7. Section 17(a) makes it unlawful for

an affiliated person of a registered

investment company to sell securities

to, or purchase securities from, the

company. The Funds and the

Underlying Portfolios may be

considered affiliated persons because

they share a common adviser. Thus,

purchases or sales of securities between

a Fund and an Underlying Portfolio may

be prohibited by section 17(a).

8. Section 17(b) provides that the SEC

shall exempt a proposed transaction

from section 17(a) if evidence

establishes that: (a) The terms of the

proposed transaction are reasonable and

fair and do not involve overreaching; (b)

the proposed transaction is consistent

with the policies of the registered

investment company concerned; and (c)

the proposed transaction is consistent

with the general provisions of the Act.

Applicants request an exemption under

sections 6(c) and 17(b) to permit the

Funds to purchase shares of an

Underlying Portfolio, and an Underlying

Portfolio to redeem such shares.1

Applicants believe that the proposed

transactions meet the standards of

sections 6(c) and 17(b).

Applicants’ Conditions

Applicants expressly consent to the

imposition of the following conditions

in connection with this request for

exemptive relief:

1. The Funds and each Underlying

Portfolio will be part of the same ‘‘group

of investment companies,’’ as defined in

rule 11a–3 under the Act.

2. No Underlying Portfolio will

acquire securities of any other

investment company in excess of the

limits contained in section 12(d)(1)(A)

of the Act.

3. A majority of the directors of the

Funds will not be ‘‘interested persons,’’

as defined in section 2(a)(19) of the Act.

4. Any sales-related charges or service

fees relating to the shares of the Funds,

when aggregated with any charges or

service fees paid by the Funds with

respect to the securities of the

Underlying Portfolio, will not exceed

the limits set forth in Article III, section

26, of the NASD’s Rules of Fair Practice.

5. Before approving any advisory

contract under section 15 of the Act, the

board of directors of the Funds,

including a majority of the directors

who are not ‘‘interested persons,’’ as

defined in section 2(a)(19), will find that

the advisory fees charged under the

contract are based on services provided

that are in addition to, rather than

duplicative of, services provided under

any Underlying Portfolio advisory

contract. This finding, and the basis

upon which the finding was made, will

be recorded fully in the minute books of

the Funds.

6. Applicants agree to provide the

following information, in an electronic

format, to the Chief Financial Analyst of

the SEC’s Division of Investment

Management: monthly average total

assets for the Funds and Underlying

Portfolios; monthly purchases and

redemptions (other than by exchange)

for the Funds and each Underlying

Portfolio; monthly exchanges into and

out of the Funds and each Underlying

Portfolio; month-end allocations of the

Funds’ assets among the Underlying

Portfolios; annual expense ratios for the

Funds and each Underlying Portfolio;

and a description of any vote taken by

the shareholders of any Underlying

Portfolio, including a statement of the

percentage of votes cast for and against

the proposal by the Funds and by the

other shareholders of the Underlying

Portfolio. The information will be

provided as soon as reasonably

practicable following each fiscal yearend of the Funds (unless the Chief

Financial Analyst notifies applicants in

writing that the information need no

longer be submitted).

For the Commission, by the Division of

Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96–16572 Filed 6–27–96; 8:45 am]

BILLING CODE 8010–01–M

Agency Sunshine Act Meeting

Notice is hereby given, pursuant to

the provisions of the Government in the

Sunshine Act, Pub. L. 94–409, that the

Securities and Exchange Commission

will hold the following meeting during

the week of July 1, 1996.

A closed meeting will be held on

Tuesday, July 2, 1996, at 10:00 a.m.

Commissioners, Counsel to the

Commissioners, the Secretary to the

Commission, and recording secretaries

will attend the closed meeting. Certain

staff members who have an interest in

the matters may also be present.

The General Counsel of the

Commission, or his designee, has

certified that, in his opinion, one or

more of the exemptions set forth in 5

U.S.C. 552b(c)(4), (8), (9)(A) and (10)

and 17 CFR 200.402(a)(4), (8), (9)(i) and

(10), permit consideration of the

scheduled matters at the closed meeting.

Commissioner Johnson, as duty

officer, voted to consider the items

listed for the closed meeting in a closed

session.

The subject matter of the closed

meeting scheduled for Tuesday, July 2,

1996, at 10:00 a.m., will be:

Institution and settlement of administrative

proceedings of an enforcement nature.

Institution of injunctive actions.

Settlement of injunctive action.

Opinion.

At times, changes in Commission

priorities require alterations in the

scheduling of meeting items. For further

information and to ascertain what, if

any, matters have been added, deleted

or postponed, please contact: The Office

of the Secretary at (202) 942–7070.

Dated: June 25, 1996.

Jonathan G. Katz,

Secretary.

[FR Doc. 96–16675 Filed 6–26–96; 12:57 pm]

BILLING CODE 8010–01–M

[Release No. 34–37356; File No. SR-Amex96–21]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the American Stock Exchange, Inc.

Relating to Dissemination of

Indications in Connection With Circuit

Breaker Trading Halts Under Rule 117

June 24, 1996.

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 June 17,

1996, the American Stock Exchange,

Inc. (‘‘Amex’’ or ‘‘Exchange’’) filed with

the Securities and Exchange

Commission (‘‘Commission’’ or ‘‘SEC’’)

the proposed rule change as described

in Items I, II and III below, which Items

have been prepared by the selfregulatory 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 implement

guidelines for dissemination of

indications to the consolidated tape in

connection with the resumption of

trading following a ‘‘circuit breaker’’

trading halt pursuant to the Amex’s

Rule 117.3
Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Notices 33787

trading in securities on the Exchange shall halt (a

‘‘Rule 117 halt’’) and not reopen for one hour if the

Dow Jones Industrial Average (‘‘DJIA’’) falls 250

points or more below its closing value on the

previous trading day. The rule provides further that

trading on the Exchange shall halt for two hours if

the DJIA falls 400 points or more on that same day.

Rule 117 was approved by the Commission on a

pilot basis on October 19, 1988 and has been

extended annually since then. See Securities

Exchange Act Release No. 36414 (Oct. 25, 1995), 60

FR 55630 (Nov. 1, 1995) (Commission’s most recent

order extending temporary approval of Rule 117).

The Amex has filed a proposal to amend Rule 117

to reduce from one hour to thirty minutes the time

period during which trading is halted due to a

decline in the DJIA of 250 points below its closing

value on the previous trading day, and to reduce

from two hours to one hour the time period for a

halt due to a 400 points decline in the DJIA. See

Securities Exchange Act Release No. 37146 (April

26, 1996), 61 FR 19650 May 2, 1996). The

Commission has not yet completed its review of

this proposed amendment.

4The Exchange notes that the proposed criteria

are identical to those currently in place at the New

York Stock Exchange (‘‘NYSE’’) in connection with

circuit breaker halts under NYSE Rule 80B. See

Securities Exchange Act Release No. 26419 (January

5, 1989), 54 FR 1041 (January 11, 1989).

5 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1) (1988).

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.

A. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

1. Purpose

The Exchange proposes to implement

guidelines for the mandatory

dissemination of indications to the

consolidated tape in connection with

the resumption of trading following a

circuit breaker halt pursuant to its Rule

117. The purposes of the proposed

criteria is to provide guidance to the

Exchange’s specialists as to the specific

circumstances under which they are

required to disseminate indications if a

significant decline in the price of a stock

from the previous last sale on the

Exchange is anticipated when trading

resumes following a circuit breaker halt.

The Exchange proposes to implement

the following guidelines:

• Dissemination of an indication shall

be mandatory prior to the reopening of

trading if such reopening will result in

a price change constituting the lesser of

10% or three points from the last sale

reported on the Amex, or five points if

the previous reported last sale is $100

or higher. No indications would be

required if the price change is less than

one point.

• If, on any day that a Rule 117 halt

is in effect, trading in a security has not

reopened by one-half hour after the

resumption of trading on the Exchange,

the matter should be treated as a

delayed opening, and would require an

indication as well as a Floor Official’s

supervision.

The Exchange has existing procedures

which require dissemination of

indications prior to delayed openings

and reopenings following regulatory or

non-regulatory halts in individual

securities. The Exchange will continue

to require dissemination of indications

in those situations.4

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

protect 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 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 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, 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 at

the Commission’s Public Reference

Section, 450 Fifth Street, N.W.,

Washington, D.C. 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–96–

21 and should be submitted by July 19,

1996.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.5

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96–16574 Filed 6–27–96; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–37349; File No. SR–CBOE–

96–38]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by the

Chicago Board Options Exchange,

Incorporated Relating to the Definition

of Expiration Month for Purposes of

Determining Log-On Obligations for

RAES in SPX Options

June 21, 1996.

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

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

June 20, 1996, the Chicago Board

Options Exchange, Incorporated

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

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change as described in Items I, II, and