[Federal Register Volume 60, Number 250 (Friday, December 29, 1995)]
[Notices]
[Pages 67386-67387]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31509]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36633; File No. SR-Amex-95-51]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the American Stock Exchange,
Inc. Relating to the Use of Automated Telephone Voting Systems by
Member Organizations or Their Proxy Agents
December 22, 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 December
13, 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. On
December 15, 1995, the Exchange submitted Amendment No. 1 to the
proposed rule change.\1\ The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
\1\ See Letter from Claudia Crowley, Special Counsel, Amex, to
Glen Barrentine, Team Leader, Division of Market Regulation, SEC,
dated December 14, 1995. Amendment No. 1 clarifies that the Exchange
is filing its proposed rule change pursuant to Rule 19b-4(e)(6) as a
``non-controversial'' rule change and makes appropriate changes to
the Form 19b-4. See infra note 3 for further description of
Amendment No. 1.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is proposing to amend Rule 577 and Section 723 of the
Company Guide to permit the use of automated telephone voting systems
by member organizations or their proxy agents.
The proposed rule change would amend Amex Rule 577 and Section 723
of the Amex Company Guide by adding the following text:
Instructions from beneficial owners may also be accepted by
member organizations or their agents through the use of an automated
telephone voting system which has been approved by the Exchange.
Such a system shall utilize an identification code for beneficial
owners and provide an opportunity for beneficial owners to validate
votes to ensure that they were received correctly. The automated
system must provide beneficial owners with the same power and
authority to issue, revoke, or otherwise change voting instructions
as currently exists for instructions communicated in written form.
Records of voting including the date of receipt of instructions and
the name of the recipient must be retained by the member
organizations or their agents.
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 an 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
Exchange Rules 575 through 585 specify the manner in which an
Exchange member organization must transmit proxy materials to customers
who are the beneficial owners of securities held of record by the
member organization. The voting process which is currently used by
member organizations (or their proxy agents) provides for the
transmission of a proxy statement and voting authorization form to
beneficial owners. The appropriate voting selections are indicated on
the form by the beneficial owner and mailed
[[Page 67387]]
back to the members organization or its agent. Beneficial owners
presently also have the option of providing oral voting instructions to
the member organization.
The New York Stock Exchange (``NYSE'') recently amended its rules
to permit member organizations or their proxy agents to use automated
telephone voting systems to receive voting instructions from beneficial
owners.\2\ Such systems permit beneficial owners to give voting
instructions on appropriate corporate proposals through a touch tone
telephone, which utilizes identification codes and provides a
validation opportunity to confirm that the voting instructions were
received correctly. This type of system is deemed to be less prone to
tabulation error than the current system.
\2\ See Securities Exchange Act Release No. 36040 (July 31,
1995), 60 FR 40215 (Aug. 7, 1995) (File No. SR-NYSE-95-15).
---------------------------------------------------------------------------
To provide member organizations and beneficial owners of securities
with consistent industry procedures (which in turn are more efficient
and cost effective) the Exchange is proposing to conform its rules to
those of the NYSE by amending Rule 577 and Section 723 of the Company
Guide to permit the use of automated telephone voting systems by member
organizations and their proxy agents. Beneficial owners will be
informed of the new voting option by specific language at the top of
the voting form.\3\ However, the use of such systems will not be
mandatory, and beneficial owners will still have the option to vote in
writing using the voting authorization form.
\3\ The following language, which is also in use by the NYSE,
will be used: ``As an alternative to completing this form, you may
enter your vote instructions by telephone. Call toll free 1-800-454-
8683 and follow the simple instructions.'' In Amendment No. 1, the
Exchange clarifies that if the specific language in the voting form
to inform beneficial owners of the new telephone voting option is
changed in any manner, the Exchange will contact the Commission and
receive approval before using the new language.
---------------------------------------------------------------------------
The proposed rule change provides that only those automated
telephone systems which have received Exchange approval may be used by
member organizations or their proxy agents, and specifies that the
Exchange may only approve an automated system if it provides an
identification code for beneficial owners as well as an opportunity for
beneficial owners to validate instructions to ensure that they were
received correctly. In addition, the automated system must provide
beneficial owners with the same power and authority to issue, revoke,
or otherwise change voting instructions as currently exists for
instructions communicated in written form. Further, member
organizations or their agents utilizing this method must maintain
records of voting, including the date of receipt of the instructions
and the name of the recipient.
Initially, the Exchange anticipates approving only the Automatic
Data Processing Brokerage Information Services Group (``ADP''), which
is also the only system currently approved by the NYSE. As is the case
with the NYSE, the Exchange will consult with the Commission Staff
prior to approving any additional system(s) and will only approve such
system(s) if the Commission Staff believes that it operates in a manner
consistent with Section 14(a) of the Act and the rules and regulations
thereunder.
2. Statutory Basis
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 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 proposed rule change will impose no 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
Because the foregoing proposed rule change: (1) Does not
significantly affect the protection of investors or the public
interest; (2) does not impose any significant burden on competition;
(3) does not become operative for 30 days from December 13, 1995, the
date on which it was filed, and the Exchange provided the Commission
with written notice of its intent to file the proposed rule change at
least five business days prior to the filing date, it has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(e)(6) thereunder.\4\
\4\ 17 CFR 240.19b-4(e)(6).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
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, 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. Sec. 552, will be available for inspection and copying at
the Commission's Public Reference Section, 450 Fifth Street, NW.,
Washington, D.C. 20549. 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-95-51 and should be
submitted by January 19, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-31509 Filed 12-28-95; 8:45 am]
BILLING CODE 8010-01-M
