[Federal Register Volume 61, Number 167 (Tuesday, August 27, 1996)]
[Notices]
[Pages 44097-44098]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-21755]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37587; File No. SR-Amex-96-31]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by American Stock Exchange, Inc. Relating to The Listing
Criteria for Equity Linked Notes
August 20, 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 August 14, 1996, the American Stock Exchange, Inc. (``Amex'' or
``Exchange'') filed with the Securities and Exchange Commission the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the Amex. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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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 Exchange proposes to amend Section 107B of the Amex Company
Guide to provide greater flexibility for issuers listing Equity Linked
Notes.
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.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
(1) Purpose
On May 20, 1993 \3\ and December 13, 1993,\4\ the Commission
approved amendments to Section 107 of the Amex Company Guide to provide
for the listing and trading of Equity Linked Term Notes (``ELNs'').
ELNs are intermediate term (two to seven years), hybrid debt
instruments, the value of which is linked to the performance of a
highly capitalized, actively traded U.S. common stock.
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\3\ See Securities Exchange Act Release No. 32345 (File No. SR-
Amex-92-42).
\4\ See Securities Exchange Act Release No. 33328 (File No. SR-
Amex-93-35).
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The Exchange now proposes to amend Section 107B of the Company
Guide to provide for greater flexibility in the listing criteria for
ELNs. Specifically, the Exchange proposes to provide for an alternative
minimum tangible net worth criteria for issuers of ELNs. An issuer with
minimum tangible net worth in excess of $250,000,000 will not be
limited to offerings of equity linked notes that do not exceed 25% of
their net worth. The Exchange believes that this 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
market for equity linked notes nor its
[[Page 44098]]
investors since issuers with the lower net worth of $150,000,000 will
still be required to limit the amount of their equity linked note
offerings to 25% of their net worth. Finally, such alternative criteria
is currently in place for issuers of currency and index warrants listed
on the exchange.\5\
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\5\ See Section 106 of the Amex Company Guide.
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(2) Basis
The Exchange believes that 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 prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, and is not designed to permit unfair
discrimination between customers, issuers, brokers or dealers.
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
Within 35 days of the date of 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 no finding or (ii) as to
which the Amex consents, the Commission will:
(A) By order approve such 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 in 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 the File No. SR-Amex-96-31 and should be
submitted by [insert date 21 days from date of publication].
For the Commission by the Division of Market Regulation, pursuant
to delegated authority.\6\
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\6\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-21755 Filed 8-26-96; 8:45 am]
BILLING CODE 8010-01-M
