Self-Regulatory Organizations; American Stock Exchange LLC; Notice of Filing of a Proposed Rule Change as Revised by Amendment Nos. 1 and 2 Thereto Relating to the Listing and Trading of Notes Linked to the Performance of the Hang Seng China Enterprises Index, 77422-77428 [06-9844]
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77422
Federal Register / Vol. 71, No. 247 / Tuesday, December 26, 2006 / Notices
to premium payments made under the
Contracts should not raise any questions
as to compliance by Jackson National
with the provisions of Section 27(i).
However, to avoid any uncertainty as to
full compliance with the Act,
Applicants request an Amended Order
providing exemption from Section
2(a)(32) and 27(i)(2)(A), to the extent
deemed necessary, to permit the
recapture of the Contract Enhancements,
including the 5% Contract
Enhancement under the circumstances
described herein and in the Application,
without the loss of relief from Section
27 provided by Section 27(i).
7. Applicants state that Section 22(c)
of the Act authorizes the Commission to
make rules and regulations applicable to
registered investment companies and to
principal underwriters of, and dealers
in, the redeemable securities of any
registered investment company to
accomplish the same purposes as
contemplated by Section 22(a). Rule
22c–1 under the Act prohibits a
registered investment company issuing
any redeemable security, a person
designated in such issuer’s prospectus
as authorized to consummate
transactions in any such security, and a
principal underwriter of, or dealer in,
such security, from selling, redeeming,
or repurchasing any such security
except at a price based on the current
net asset value of such security which
is next computed after receipt of a
tender of such security for redemption
or of an order to purchase or sell such
security.
8. Applicants state that it is possible
that someone might view Jackson
National’s recapture of the Contract
Enhancements as resulting in the
redemption of redeemable securities for
a price other than one based on the
current net asset value of the JNL
Separate Account. Applicants contend,
however, that the recapture of the
Contract Enhancement does not violate
Rule 22c–1. The recapture of some or all
of the Contract Enhancement does not
involve either of the evils that Section
22(c) and Rule 22c–1 were intended to
eliminate or reduce as far as reasonably
practicable, namely: (i) The dilution of
the value of outstanding redeemable
securities of registered investment
companies through their sale at a price
below net asset value or repurchase at
a price above it, and (ii) other unfair
results, including speculative trading
practices. To effect a recapture of a
Contract Enhancement, Jackson
National will redeem interests in a
Contract owner’s contract value at a
price determined on the basis of the
current net asset value of the JNL
Separate Account. The amount
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recaptured will be less than or equal to
the amount of the Contract
Enhancement that Jackson National paid
out of its general account assets.
Although Contract owners will be
entitled to retain any investment gains
attributable to the Contract
Enhancement and to bear any
investment losses attributable to the
Contract Enhancement, the amount of
such gains or losses will be determined
on the basis of the current net asset
values of the JNL Separate Account.
Thus, no dilution will occur upon the
recapture of the Contract Enhancement.
Applicants also submit that the second
harm that Rule 22c–1 was designed to
address, namely, speculatively trading
practices calculated to take advantage of
backward pricing, will not occur as a
result of the recapture of the Contract
Enhancement. Because neither of the
harms that Rule 22c–1 was meant to
address is found in the recapture of the
Contract Enhancement, Rule 22c–1
should not apply to any Contract
Enhancement. However, to avoid any
uncertainty as to full compliance with
Rule 22c–1, Applicants request an
Amended Order granting an exemption
from the provisions of Rule 22c–1 to the
extent deemed necessary to permit them
to recapture the Contract Enhancement
under the Contracts.
9. Applicants submit that extending
the requested relief to encompass Future
Contracts and Other Accounts is
appropriate in the public interest
because it promotes competitiveness in
the variable annuity market by
eliminating the need to file redundant
exemptive applications prior to
introducing new variable annuity
contracts. Investors would receive no
benefit or additional protection by
requiring Applicants to repeatedly seek
exemptive relief that would present no
issues under the Act not already
addressed in the Application.
Applicants submit, for the reasons
stated herein, that their exemptive
request meets the standards set out in
Section 6(c) of the Act, namely, that the
exemptions requested are appropriate in
the public interest and consistent with
the protection of investors and the
purposes fairly intended by the policy
and provisions of the Act and that,
therefore, the Commission should grant
the requested order.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Nancy M. Morris,
Secretary.
[FR Doc. E6–22009 Filed 12–22–06; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54943; File No. SR–Amex–
2006–90]
Self-Regulatory Organizations;
American Stock Exchange LLC; Notice
of Filing of a Proposed Rule Change as
Revised by Amendment Nos. 1 and 2
Thereto Relating to the Listing and
Trading of Notes Linked to the
Performance of the Hang Seng China
Enterprises Index
December 15, 2006.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934, as
amended (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 notice is hereby given that
on September 22, 2006, 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
substantially prepared by Amex. On
November 15, 2006, Amex submitted
Amendment No. 1 to the proposed rule
change.3 On December 12, 2006, Amex
submitted Amendment No. 2 to the
proposed rule change.4 The Commission
is publishing this notice to solicit
comments on the proposed rule change,
as amended, from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to list and
trade notes linked to the performance of
the Hang Seng China Enterprises Index
(‘‘Index’’). The text of the proposed rule
change (including Appendix A) is
available on Amex’s Web site at https://
www.amex.com, at Amex’s principal
office, and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
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. Amex has prepared
summaries, set forth in Sections A, B,
1 15
U.S.C. 78s(b)(l).
CFR 240. 19b–4.
3 Amendment No. 1 supersedes and replaces the
original rule filing in its entirety.
4 Amendment No. 2 supersedes and replaces the
original rule filing and Amendment No. 1 in their
entirety.
2 17
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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
Under Section 107A of the Amex
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.5 Amex proposes to list for
trading under Section 107A of the
Company Guide notes linked to the
performance of the Index (‘‘Notes’’).
Citigroup Funding Inc. (‘‘Issuer’’) will
issue the Notes under the name ‘‘Stock
Market Upturn Notes.’’ The Notes
provide for a multiplier of any positive
performance of the Index during the
stated term, subject to a maximum
payment amount or ceiling to be
determined at the time of issuance
(‘‘Capped Value’’).6
The Notes would conform to the
initial listing guidelines under Section
107A 7 and continued listing guidelines
under Sections 1001–1003 8 of the
Company Guide. The Notes would be
senior non-convertible debt securities of
the Issuer. The Issuer would issue the
Notes on an ‘‘Issue Date’’ approximately
three business days after the ‘‘Trade
Date’’ (as defined below) in
denominations of whole units, with
each unit representing a single Note.
The Notes would mature on March 7,
2008 (‘‘Maturity Date’’) approximately
1.5 years after the Issue Date. The
original public offering price would be
$10 per Note. The Notes would entitle
the owner at maturity to receive an
amount based upon the percentage
change of the Index. The Notes would
not have a minimum principal amount
that would be repaid; accordingly,
payment on the Notes prior to or at
maturity might be less than the original
issue price of the Notes.9 The Notes
would not be callable by the issuer,
Citigroup, or redeemable by the holder.
77423
The payment that a holder or investor
of a Note would be entitled to receive
(‘‘Redemption Amount’’) would depend
on the relation of: (1) The level of the
Index at the close of the market on a
single business day, March 4, 2008
(‘‘Valuation Date’’), shortly prior to
maturity of the Notes (‘‘Final Index
Level’’); and (2) the closing value of the
Index on the date the Notes are priced
for initial sale to the public (‘‘Initial
Index Level’’). If there is a ‘‘Market
Disruption Event’’ (as defined below)
when determining the Final Index
Level, the Final Index Level may be
deferred up to two business days if
deemed appropriate by the calculation
agent.
Depending upon whether the Final
Index Level (as defined below) is less
than or equal to or greater than the
Initial Index Level (as defined below),
the Notes would entitle the owner at
maturity to receive:
• If the Final Index Level is less than
or equal to Initial Index Level:
( Final Index Level − Initial Index Level )
$10 + $10 ×
Initial Index Level
e
• If the Final Index Level is greater
than Initial Index Level:
( Final Index Level − Initial Index Level )
$10 + $10 ×
× Participation Rate , not to exceed the Capped Value
Initial Index Level
e
5 See Securities Exchange Act Release No. 27753
(March 1, 1990), 55 FR 8626 (March 8, 1990) (order
approving File No. SR–Amex–89–29).
6 The Exchange submits that the proposal is
similar to several instruments that it currently lists
and trades. See Securities Exchange Act Release No.
51563 (April 15, 2005), 70 FR 21257 (April 25,
2005) (SR–Amex–2005–01); Securities Exchange
Act Release No. 51227 (February 18, 2005), 70 FR
9395 (February 25, 2005) (SR–Amex–2005–010);
and Securities Exchange Act Release No. 50016
(July 14, 2004), 69 FR 43639 (July 21, 2004) (SR–
Amex–2004–43).
7 The initial listing standards for the Notes
require: (1) A market value of at least $4 million
and (2) a minimum public distribution requirement
of one million trading units with a minimum of 400
public shareholders. In addition, the listing
guidelines require that the issuer have assets in
excess of $100 million and stockholders’ 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
requires 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 stockholders’ equity of at least $20
million.
8 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
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The Hang Seng China Enterprises
Index was launched on August 8, 1994,
to track the performance of the shares of
all Chinese enterprises listed on the
Stock Exchange of Hong Kong (‘‘HShares’’). This was one year after the
first H-Share company was listed on the
Stock Exchange of Hong Kong. Before
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the launch of the 200-stock Hang Seng
Composite Index (‘‘HSCI’’) on October 3,
2001, the Index included all H-Shares
listed on the Main Board of the Stock
Exchange of Hong Kong, but after the
launch of the HSCI, the Index contains
only those components that are
included in the HSCI. Constituents of
the Index comprise only the largest Hwould 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 Notes, the Exchange would rely,
in part, on the guidelines for bonds in Section
1003(b)(iv). Section 1003(b)(iv)(A) provides that the
Exchange would 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.
9 A negative return of the Index would reduce the
redemption amount at maturity with the potential
that the holder of the Note could lose his entire
investment amount.
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EN26DE06.003</GPH>
The Hang Seng China Enterprises Index
EN26DE06.001</GPH>
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The Initial Index Level would be the
closing level of the Index on August 24,
2006, the date the Notes priced for
initial sale to the public (‘‘Trade Date’’)
and the Final Index Level would be the
closing level of the Index on the
Valuation Date on March 4, 2008. The
Participation Rate (in the formula above)
is 300%.
77424
Federal Register / Vol. 71, No. 247 / Tuesday, December 26, 2006 / Notices
Shares companies that are included in
the HSCI. The Index is a capitalizationweighted index. The base value of the
Index is 2000 as of January 3, 2000. The
Index replaced the old HSCE index on
October 3, 2001. The Index components
are subject to review semi-annually at
the same time as the HSCI. H-Share
companies joining or leaving the HSCI
are automatically included or excluded
from the Index.
As of July 31, 2006, the Index
consisted of H-Shares of 38 separate
entities. Information relating to the
Index and components is available on
the Web site for the Stock Exchange of
Hong Kong at https://www.hkex.com.hk,
Hang Seng Indexes at https://
www.hsi.com.hk, as well as various
market data vendors and financial news
publications.
Annual Reweighting and Rebalancing of
the Index
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The Index is published and compiled
by HSI Services Limited, a wholly
owned subsidiary of Hang Seng Bank.10
The Index is reviewed twice each year
at the same time the HSCI is reviewed.
As previously mentioned, H-Share
companies joining or leaving the HSCI
are automatically included or excluded
from the Index. The weightings
(freefloat-adjusted market capitalization
weightings, described below) for the
Index, as well as any associated Cap
Factors (described below), are reviewed
and announced generally twice each
year within the first six weeks of Q1 and
Q3 under the supervision of HSI
Services Limited. The current
weightings, as listed in Appendix A,
were updated on August 11, 2006,
which resulted in 37 companies being
included in the Index.
To ensure that no H-Share company
has a weighting exceeding 15%, a Cap
Factor (‘‘CF’’) is calculated based on
market value as of each regular semiannual review date. A review of the CF
is conducted semi-annually to coincide
with the regular review of the freefloatadjusted market capitalization
weightings for the Index. For
constituents whose weightings do not
exceed 15% of the Index, the CF is set
at 100% and for those constituents
whose weightings exceed 15% of the
Index, the CF is set so as to ensure the
weighting does not exceed 15% as of the
10 HSI Services Limited is a member of the Hang
Seng Bank Group and affiliated with broker dealers.
HSI Services Limited has represented to the
Exchange that the following exist: (1) Appropriate
firewalls to ensure independence of operations
among different units within the Hang Seng Group;
and (2) policies and procedures containing among
other things, insider trading prohibitions, designed
to prevent conflicts of interest.
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16:15 Dec 22, 2006
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semi-annual review date. Individual
constituent weightings may exceed 15%
during the periods between the semiannual reviews. The current CFs for the
Index were set as of September 8, 2006,
with a CF of 100% for all constituent
companies other than PetroChina (CF of
77.66%).
A freefloat-adjusted market
capitalization weighting with a cap of
15% for the H-Share portion of each
constituent company has been adopted
for the Index calculation since March 6,
2006. The freefloat adjustment is
calculated by excluding the following
types of holdings:
• Shares held by strategic
shareholder(s) who individually or
collectively control more than 30% of
the shareholdings (‘‘Strategic
Holdings’’);
• Shares held by director(s) who
individually control more than 5% of
the shareholdings (‘‘Directors’
Holdings’’);
• Shares held by a Hong Kong-listed
company which controls more than 5%
of the shareholdings as investments
(‘‘Cross-Holdings’’); and
• Shares held by shareholder(s) who
individually or collectively represent
more than 5% of the shareholdings in
the company and with a publicly
disclosed lock-up arrangement (‘‘LockUp Shares’’).
The data used for the freefloat
adjustment are taken from publicly
available sources, including annual
reports and Securities Notification
History Reports from Hong Kong
Exchanges and Clearing Limited.
Index Calculation Disruption Events
From time to time, disruptions can
occur in trading on exchanges. The
daily calculation of the Index would be
adjusted in the event of the occurrence
or existence of any suspension of or
limitation imposed on trading (by
reason of movements in price exceeding
limits permitted by any relevant
exchange or market or otherwise) of, or
the unavailability, through a recognized
system of public dissemination of
transaction information, for a period
longer than two hours, or during the
one-half hour period preceding the close
of trading, on the applicable exchange
or market, of accurate price, volume or
related information in respect of:
(1) Stocks which then comprise 20%
or more of the value of the Hang Seng
China Enterprises Index or any
successor index;
(2) Any options or futures contracts,
or any options on such futures contracts
relating to the Hang Seng China
Enterprises Index or any successor
index; or
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(3) Any options or futures contracts
relating to stocks which then comprise
20% or more of the value of the Hang
Seng China Enterprises Index or any
successor index on any exchange or
market, if in each case, any such
suspension, limitation, or unavailability
is considered to be material by Citigroup
Global Markets (each, a ‘‘Market
Disruption Event’’).11
In the case of a temporary disruption
in connection with the trading of the HShares comprising the Index or a Market
Disruption Event, the Exchange believes
that it is unnecessary for a filing
pursuant to Section 19(b) under the Act
to be submitted to the Commission. The
Exchange submits that for a temporary
disruption of said securities or a Market
Disruption Event, the Exchange would
typically use the last available price,
except that if and to the extent
determined by Citigroup Global Markets
the value of the Index for that day
would be the arithmetic mean of the
value of the Index obtained from as
many dealers in equity securities, but
not exceeding three such dealers (‘‘fair
value’’ pricing). The Exchange
represents that, if the use of the last
available price or ‘‘fair value’’ pricing
for an Index constituent or the Index is
more than of a temporary nature, the
Exchange will submit a proposed rule
change pursuant to Rule 19b–4 seeking
the Commission’s approval to continue
to trade the Notes. Unless approved for
continued trading, the Exchange would
commence delisting proceedings.
Exchange Rules Applicable to the Notes
The Notes are cash-settled in U.S.
dollars and do not give the holder any
right or other ownership interest in the
Index or commodities comprising the
Index. The Notes are designed for
investors who desire to participate in, or
gain exposure to, an index composed of
H-Shares and are willing to hold the
investment to maturity.
The Notes would trade as equity
securities subject to Amex equity
trading rules including, among others,
rules governing priority, parity, and
precedence of orders; specialist
responsibilities; account opening, and
customer suitability requirements. In
addition, the Notes would be subject to
the equity margin rules of the
Exchange.12 The Exchange would, prior
to trading the Notes, distribute a circular
to the membership providing guidance
with regard to member firm compliance
11 Options and futures contracts relating to the
Index, the Hang Seng China Enterprises Index, or
stocks comprising the Hang Seng Enterprises Index
are indicators of the liquidity of said stocks or
indexes.
12 See Amex Rule 462.
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responsibilities (including suitability
recommendations) when handling
transactions in the Notes and
highlighting the special risks and
characteristics of the Notes. With
respect to suitability recommendations
and risks, the Exchange would require
members, member organizations, and
employees thereof recommending a
transaction in the Notes: (1) To
determine that such transaction is
suitable for the customer; and (2) to
have a reasonable basis for believing
that the customer can evaluate the
special characteristics of, and is able to
bear the financial risks of, such
transaction. In addition, the Issuer
would deliver a prospectus in
connection with the initial sales of the
Notes.
Criteria for Initial and Continued
Listing
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The Exchange represents that it
prohibits the initial and/or continued
listing of any security that is not in
compliance with Rule 10A–3 under the
Securities Act of 1934.13 The Exchange
also has a general policy that prohibits
the distribution of material, non-public
information by its employees.
The Exchange represents that it would
file a proposed rule change pursuant to
Rule 19b–4 under the Act, seeking
approval to continue trading the Notes
and unless approved, the Exchange
would commence delisting the Notes if:
• HSCI substantially changes either
the index component selection
methodology or the weighting
methodology;
• If a new component is added to the
Index (or pricing information is used for
a new or existing component) that
constitutes more than 10% of the weight
of the Index with whose principal
trading market the Exchange does not
have a comprehensive surveillance
sharing agreement; or
• If a successor or substitute index is
used in connection with the Notes. The
filing would address, among other
things the listing and trading
characteristics of the successor or
substitute index and the Exchange’s
surveillance procedures applicable
thereto.
If the Index value does not change
during some or all of the period when
trading is occurring on the Exchange
because of time zone differences or
holidays in Hong Kong, then the last
official calculated Index value would
remain available throughout Exchange
trading hours.
Trading Halts
The Exchange would halt trading in
the Notes if the circuit breaker
parameters of Exchange Rule 117 have
been reached. In exercising its
discretion to halt or suspend trading in
the Notes, the Exchange may consider
factors such as those set forth in
Exchange Rule 918C(b), in addition to
other factors that may be relevant. In
particular, if the Index value is not
being disseminated as required, the
Exchange may halt trading during the
day in which the interruption to the
dissemination of the Index value occurs.
If the interruption to the dissemination
of the Index value persists past the
trading day in which it occurred, the
Exchange would halt trading no later
than the beginning of the trading day
following the interruption.
The Exchange represents that its
surveillance procedures are adequate to
properly monitor the trading of the
Notes. Amex, has stated that it would
rely on its existing surveillance
procedures governing index-linked
securities. The Exchange currently has
in place an Information Sharing
Agreement with the Stock Exchange of
Hong Kong for the purpose of providing
information in connection with trading
in or related to the components
comprising the Index.
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 cooperation 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.
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.
14 15
13 See
17 CFR 240.10A–3(c)(1).
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15 15
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U.S.C. 78f(b).
U.S.C. 78f(b)(5).
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77425
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 so finding or
(ii) as to which the self-regulatory
organization 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.
Amex has requested accelerated
approval of this proposed rule change,
as amended, prior to the 30th day after
the date of publication of the notice of
the filing thereof, following the
conclusion of a 15-day comment period.
The Commission has determined that a
15-day comment period is appropriate
before taking any action.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form at https://www.sec.gov/
rules/sro.shtml or send an e-mail to
rule-comments@sec.gov. Please include
File No. SR–Amex–2006–90 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File No.
SR–Amex–2006–90. This file number
should be included on the subject line
if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site at https://www.sec.gov/
rules/sro.shtml. 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
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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
Room, 100 F Street, NE., Washington,
DC 20549. Copies of such filing also will
be available for inspection and copying
at the principal office of the Exchange.
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16:15 Dec 22, 2006
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All comments received will be posted
without change; the Commission does
not edit personal identifying
information from submissions. You
should submit only information that
you wish to make available publicly. All
submissions should refer to File No.
PO 00000
SR–Amex–2006–90 and should be
submitted on or before January 10, 2007.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.16
Nancy M. Morris
Secretary.
BILLING CODE 8011–01–P
16 17
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EN26DE06.002</GPH>
sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 71, No. 247 / Tuesday, December 26, 2006 / Notices
77428
Federal Register / Vol. 71, No. 247 / Tuesday, December 26, 2006 / Notices
[FR Doc. 06–9844 Filed 12–22–06; 8:45 am]
BILLING CODE 8011–01–C
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54949; File No. SR–BSE–
2006–53]
Self-Regulatory Organizations; Boston
Stock Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change and
Amendment No. 1 Thereto To Allow
Exchange Traded Funds To Trade on
the Boston Equities Exchange Until
4:15 p.m. Eastern Standard Time
December 18, 2006.
sroberts on PROD1PC70 with NOTICES
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 November
30, 2006, the Boston Stock Exchange,
Inc. (‘‘Exchange’’ or ‘‘BSE’’) 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 substantially prepared by the
Exchange. On December 14, 2006, the
BSE submitted Amendment No. 1 to the
proposed rule change. The Exchange
filed the proposed rule change pursuant
to Section 19(b)(3)(A) of the Act 3 and
Rule 19b–4(f)(6) thereunder,4 which
renders the proposal effective upon
filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change, as amended, from interested
persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The BSE proposes to allow Exchange
Traded Funds, or ETFs, to trade on the
Boston Equities Exchange (‘‘BeX’’) until
4:15 p.m. Eastern Standard Time each
business day. Additionally, by this
filing the BSE is providing notice to its
Members that the Good Till Time order
type will not be available for
approximately six to eight weeks
following the November 20, 2006
launch of the BeX marketplace. The BSE
will provide its Members with at least
one day’s notice of the date Good Till
Time order types will be accepted on
BeX.
The text of the proposed rule changes
is available on the Exchange’s Web site
(https://www.bse.com), at the Exchange’s
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6).
16:15 Dec 22, 2006
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
Exchange 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
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
On June 13, 2006, the BSE filed
Amendment No. 3 to SR–BSE–2006–22,
a rule filing submitted in connection
with the implementation of the first of
two phases of BeX, a fully automated
electronic book for the display and
execution of orders in securities. On
August 25, 2006, SR–BSE–2006–22 was
approved by the Commission.5 On
August 3, 2006, the BSE filed, in
connection with the implementation of
the second phase of the BeX trading
system and in connection with
satisfying the requirements of
Regulation NMS, SR–BSE–2006–30. On
September 29, 2006, the Commission
approved SR–BSE–2006–30.6
The purpose of this filing is to amend
the operating hours of the BeX
marketplace to reflect that ETFs may
trade on BeX until 4:15 p.m. Eastern
Standard Time each business day. The
Amendment to the filing clarifies that
although ETFs may trade on BeX until
4:15 p.m. Eastern Standard Time, ETFs
cannot be submitted as Limit or Close
Orders, will not participate in the
Market on Close Period described in
Chapter XXXVII, Section 3(f)(i) of the
BSE Rules, and will not be placed in the
Authorized Reserve State described in
Chapter XXXVII, Section 3(f)(ii) of the
BSE Rules. Rather, ETFs will simply
cease matching in the BeX system after
4:15 p.m.
Further, by this filing, the BSE is
providing notice to its Members that the
Good Till Time order type will not be
available for approximately six to eight
5 See Securities Exchange Act Release No. 54365
(Aug. 25, 2006), 71 FR 52192 (Sept. 1, 2006).
6 See Securities Exchange Act Release No. 54546
(Sept. 29, 2006), 71 FR 59161 (Oct. 6, 2006).
2 17
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Commission’s Public Reference Room.
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weeks following the November 20, 2006
launch of the BeX marketplace. The BSE
will provide its Members with at least
one day’s notice of the date Good Till
Time order types will be accepted on
BeX.
2. Statutory Basis
The Exchange believes that the
proposal, as amended, is consistent with
the requirements of Section 6(b) of the
Act,7 in general, and furthers the
objectives of Section 6(b)(5) of the Act,8
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
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.9
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 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 neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (1) Significantly affect
the protection of investors or the public
interest; (2) impose any significant
burden on competition; and (3) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate if
consistent with the protection of
investors and the public interest,
provided that the Exchange has given
the Commission written notice of its
intent to file the proposed rule change
7 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
9 For purposes of calculating the 60-day period
within which the Commission may summarily
abrogate the proposed rule change under Section
19(b)(3)(C) of the Act, the Commission considers
the period to commence on December 14, 2006, the
date on which the BSE filed Amendment No. 1. See
15 U.S.C. 78s(b)(3)(C).
8 15
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]]>Agencies
[Federal Register Volume 71, Number 247 (Tuesday, December 26, 2006)]
[Notices]
[Pages 77422-77428]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-9844]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54943; File No. SR-Amex-2006-90]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing of a Proposed Rule Change as Revised by Amendment Nos.
1 and 2 Thereto Relating to the Listing and Trading of Notes Linked to
the Performance of the Hang Seng China Enterprises Index
December 15, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934, as amended (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is
hereby given that on September 22, 2006, 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 substantially
prepared by Amex. On November 15, 2006, Amex submitted Amendment No. 1
to the proposed rule change.\3\ On December 12, 2006, Amex submitted
Amendment No. 2 to the proposed rule change.\4\ The Commission is
publishing this notice to solicit comments on the proposed rule change,
as amended, from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(l).
\2\ 17 CFR 240. 19b-4.
\3\ Amendment No. 1 supersedes and replaces the original rule
filing in its entirety.
\4\ Amendment No. 2 supersedes and replaces the original rule
filing and Amendment No. 1 in their entirety.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to list and trade notes linked to the
performance of the Hang Seng China Enterprises Index (``Index''). The
text of the proposed rule change (including Appendix A) is available on
Amex's Web site at https://www.amex.com, at Amex's principal office, and
at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, 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. Amex has prepared summaries, set forth in Sections A,
B,
[[Page 77423]]
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
Under Section 107A of the Amex 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.\5\ Amex proposes to list for trading
under Section 107A of the Company Guide notes linked to the performance
of the Index (``Notes''). Citigroup Funding Inc. (``Issuer'') will
issue the Notes under the name ``Stock Market Upturn Notes.'' The Notes
provide for a multiplier of any positive performance of the Index
during the stated term, subject to a maximum payment amount or ceiling
to be determined at the time of issuance (``Capped Value'').\6\
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 27753 (March 1,
1990), 55 FR 8626 (March 8, 1990) (order approving File No. SR-Amex-
89-29).
\6\ The Exchange submits that the proposal is similar to several
instruments that it currently lists and trades. See Securities
Exchange Act Release No. 51563 (April 15, 2005), 70 FR 21257 (April
25, 2005) (SR-Amex-2005-01); Securities Exchange Act Release No.
51227 (February 18, 2005), 70 FR 9395 (February 25, 2005) (SR-Amex-
2005-010); and Securities Exchange Act Release No. 50016 (July 14,
2004), 69 FR 43639 (July 21, 2004) (SR-Amex-2004-43).
---------------------------------------------------------------------------
The Notes would conform to the initial listing guidelines under
Section 107A \7\ and continued listing guidelines under Sections 1001-
1003 \8\ of the Company Guide. The Notes would be senior non-
convertible debt securities of the Issuer. The Issuer would issue the
Notes on an ``Issue Date'' approximately three business days after the
``Trade Date'' (as defined below) in denominations of whole units, with
each unit representing a single Note. The Notes would mature on March
7, 2008 (``Maturity Date'') approximately 1.5 years after the Issue
Date. The original public offering price would be $10 per Note. The
Notes would entitle the owner at maturity to receive an amount based
upon the percentage change of the Index. The Notes would not have a
minimum principal amount that would be repaid; accordingly, payment on
the Notes prior to or at maturity might be less than the original issue
price of the Notes.\9\ The Notes would not be callable by the issuer,
Citigroup, or redeemable by the holder.
---------------------------------------------------------------------------
\7\ The initial listing standards for the Notes require: (1) A
market value of at least $4 million and (2) a minimum public
distribution requirement of one million trading units with a minimum
of 400 public shareholders. In addition, the listing guidelines
require that the issuer have assets in excess of $100 million and
stockholders' 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 requires 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
stockholders' equity of at least $20 million.
\8\ 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
would 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 Notes, the
Exchange would rely, in part, on the guidelines for bonds in Section
1003(b)(iv). Section 1003(b)(iv)(A) provides that the Exchange would
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.
\9\ A negative return of the Index would reduce the redemption
amount at maturity with the potential that the holder of the Note
could lose his entire investment amount.
---------------------------------------------------------------------------
The payment that a holder or investor of a Note would be entitled
to receive (``Redemption Amount'') would depend on the relation of: (1)
The level of the Index at the close of the market on a single business
day, March 4, 2008 (``Valuation Date''), shortly prior to maturity of
the Notes (``Final Index Level''); and (2) the closing value of the
Index on the date the Notes are priced for initial sale to the public
(``Initial Index Level''). If there is a ``Market Disruption Event''
(as defined below) when determining the Final Index Level, the Final
Index Level may be deferred up to two business days if deemed
appropriate by the calculation agent.
Depending upon whether the Final Index Level (as defined below) is
less than or equal to or greater than the Initial Index Level (as
defined below), the Notes would entitle the owner at maturity to
receive:
If the Final Index Level is less than or equal to Initial
Index Level:
[GRAPHIC] [TIFF OMITTED] TN26DE06.001
If the Final Index Level is greater than Initial Index
Level:
[GRAPHIC] [TIFF OMITTED] TN26DE06.003
The Initial Index Level would be the closing level of the Index on
August 24, 2006, the date the Notes priced for initial sale to the
public (``Trade Date'') and the Final Index Level would be the closing
level of the Index on the Valuation Date on March 4, 2008. The
Participation Rate (in the formula above) is 300%.
The Hang Seng China Enterprises Index
The Hang Seng China Enterprises Index was launched on August 8,
1994, to track the performance of the shares of all Chinese enterprises
listed on the Stock Exchange of Hong Kong (``H-Shares''). This was one
year after the first H-Share company was listed on the Stock Exchange
of Hong Kong. Before the launch of the 200-stock Hang Seng Composite
Index (``HSCI'') on October 3, 2001, the Index included all H-Shares
listed on the Main Board of the Stock Exchange of Hong Kong, but after
the launch of the HSCI, the Index contains only those components that
are included in the HSCI. Constituents of the Index comprise only the
largest H-
[[Page 77424]]
Shares companies that are included in the HSCI. The Index is a
capitalization-weighted index. The base value of the Index is 2000 as
of January 3, 2000. The Index replaced the old HSCE index on October 3,
2001. The Index components are subject to review semi-annually at the
same time as the HSCI. H-Share companies joining or leaving the HSCI
are automatically included or excluded from the Index.
As of July 31, 2006, the Index consisted of H-Shares of 38 separate
entities. Information relating to the Index and components is available
on the Web site for the Stock Exchange of Hong Kong at https://
www.hkex.com.hk, Hang Seng Indexes at https://www.hsi.com.hk, as well as
various market data vendors and financial news publications.
Annual Reweighting and Rebalancing of the Index
The Index is published and compiled by HSI Services Limited, a
wholly owned subsidiary of Hang Seng Bank.\10\ The Index is reviewed
twice each year at the same time the HSCI is reviewed. As previously
mentioned, H-Share companies joining or leaving the HSCI are
automatically included or excluded from the Index. The weightings
(freefloat-adjusted market capitalization weightings, described below)
for the Index, as well as any associated Cap Factors (described below),
are reviewed and announced generally twice each year within the first
six weeks of Q1 and Q3 under the supervision of HSI Services Limited.
The current weightings, as listed in Appendix A, were updated on August
11, 2006, which resulted in 37 companies being included in the Index.
---------------------------------------------------------------------------
\10\ HSI Services Limited is a member of the Hang Seng Bank
Group and affiliated with broker dealers. HSI Services Limited has
represented to the Exchange that the following exist: (1)
Appropriate firewalls to ensure independence of operations among
different units within the Hang Seng Group; and (2) policies and
procedures containing among other things, insider trading
prohibitions, designed to prevent conflicts of interest.
---------------------------------------------------------------------------
To ensure that no H-Share company has a weighting exceeding 15%, a
Cap Factor (``CF'') is calculated based on market value as of each
regular semi-annual review date. A review of the CF is conducted semi-
annually to coincide with the regular review of the freefloat-adjusted
market capitalization weightings for the Index. For constituents whose
weightings do not exceed 15% of the Index, the CF is set at 100% and
for those constituents whose weightings exceed 15% of the Index, the CF
is set so as to ensure the weighting does not exceed 15% as of the
semi-annual review date. Individual constituent weightings may exceed
15% during the periods between the semi-annual reviews. The current CFs
for the Index were set as of September 8, 2006, with a CF of 100% for
all constituent companies other than PetroChina (CF of 77.66%).
A freefloat-adjusted market capitalization weighting with a cap of
15% for the H-Share portion of each constituent company has been
adopted for the Index calculation since March 6, 2006. The freefloat
adjustment is calculated by excluding the following types of holdings:
Shares held by strategic shareholder(s) who individually
or collectively control more than 30% of the shareholdings (``Strategic
Holdings'');
Shares held by director(s) who individually control more
than 5% of the shareholdings (``Directors' Holdings'');
Shares held by a Hong Kong-listed company which controls
more than 5% of the shareholdings as investments (``Cross-Holdings'');
and
Shares held by shareholder(s) who individually or
collectively represent more than 5% of the shareholdings in the company
and with a publicly disclosed lock-up arrangement (``Lock-Up Shares'').
The data used for the freefloat adjustment are taken from publicly
available sources, including annual reports and Securities Notification
History Reports from Hong Kong Exchanges and Clearing Limited.
Index Calculation Disruption Events
From time to time, disruptions can occur in trading on exchanges.
The daily calculation of the Index would be adjusted in the event of
the occurrence or existence of any suspension of or limitation imposed
on trading (by reason of movements in price exceeding limits permitted
by any relevant exchange or market or otherwise) of, or the
unavailability, through a recognized system of public dissemination of
transaction information, for a period longer than two hours, or during
the one-half hour period preceding the close of trading, on the
applicable exchange or market, of accurate price, volume or related
information in respect of:
(1) Stocks which then comprise 20% or more of the value of the Hang
Seng China Enterprises Index or any successor index;
(2) Any options or futures contracts, or any options on such
futures contracts relating to the Hang Seng China Enterprises Index or
any successor index; or
(3) Any options or futures contracts relating to stocks which then
comprise 20% or more of the value of the Hang Seng China Enterprises
Index or any successor index on any exchange or market, if in each
case, any such suspension, limitation, or unavailability is considered
to be material by Citigroup Global Markets (each, a ``Market Disruption
Event'').\11\
---------------------------------------------------------------------------
\11\ Options and futures contracts relating to the Index, the
Hang Seng China Enterprises Index, or stocks comprising the Hang
Seng Enterprises Index are indicators of the liquidity of said
stocks or indexes.
---------------------------------------------------------------------------
In the case of a temporary disruption in connection with the
trading of the H-Shares comprising the Index or a Market Disruption
Event, the Exchange believes that it is unnecessary for a filing
pursuant to Section 19(b) under the Act to be submitted to the
Commission. The Exchange submits that for a temporary disruption of
said securities or a Market Disruption Event, the Exchange would
typically use the last available price, except that if and to the
extent determined by Citigroup Global Markets the value of the Index
for that day would be the arithmetic mean of the value of the Index
obtained from as many dealers in equity securities, but not exceeding
three such dealers (``fair value'' pricing). The Exchange represents
that, if the use of the last available price or ``fair value'' pricing
for an Index constituent or the Index is more than of a temporary
nature, the Exchange will submit a proposed rule change pursuant to
Rule 19b-4 seeking the Commission's approval to continue to trade the
Notes. Unless approved for continued trading, the Exchange would
commence delisting proceedings.
Exchange Rules Applicable to the Notes
The Notes are cash-settled in U.S. dollars and do not give the
holder any right or other ownership interest in the Index or
commodities comprising the Index. The Notes are designed for investors
who desire to participate in, or gain exposure to, an index composed of
H-Shares and are willing to hold the investment to maturity.
The Notes would trade as equity securities subject to Amex equity
trading rules including, among others, rules governing priority,
parity, and precedence of orders; specialist responsibilities; account
opening, and customer suitability requirements. In addition, the Notes
would be subject to the equity margin rules of the Exchange.\12\ The
Exchange would, prior to trading the Notes, distribute a circular to
the membership providing guidance with regard to member firm compliance
[[Page 77425]]
responsibilities (including suitability recommendations) when handling
transactions in the Notes and highlighting the special risks and
characteristics of the Notes. With respect to suitability
recommendations and risks, the Exchange would require members, member
organizations, and employees thereof recommending a transaction in the
Notes: (1) To determine that such transaction is suitable for the
customer; and (2) to have a reasonable basis for believing that the
customer can evaluate the special characteristics of, and is able to
bear the financial risks of, such transaction. In addition, the Issuer
would deliver a prospectus in connection with the initial sales of the
Notes.
---------------------------------------------------------------------------
\12\ See Amex Rule 462.
---------------------------------------------------------------------------
Criteria for Initial and Continued Listing
The Exchange represents that it prohibits the initial and/or
continued listing of any security that is not in compliance with Rule
10A-3 under the Securities Act of 1934.\13\ The Exchange also has a
general policy that prohibits the distribution of material, non-public
information by its employees.
---------------------------------------------------------------------------
\13\ See 17 CFR 240.10A-3(c)(1).
---------------------------------------------------------------------------
The Exchange represents that it would file a proposed rule change
pursuant to Rule 19b-4 under the Act, seeking approval to continue
trading the Notes and unless approved, the Exchange would commence
delisting the Notes if:
HSCI substantially changes either the index component
selection methodology or the weighting methodology;
If a new component is added to the Index (or pricing
information is used for a new or existing component) that constitutes
more than 10% of the weight of the Index with whose principal trading
market the Exchange does not have a comprehensive surveillance sharing
agreement; or
If a successor or substitute index is used in connection
with the Notes. The filing would address, among other things the
listing and trading characteristics of the successor or substitute
index and the Exchange's surveillance procedures applicable thereto.
If the Index value does not change during some or all of the period
when trading is occurring on the Exchange because of time zone
differences or holidays in Hong Kong, then the last official calculated
Index value would remain available throughout Exchange trading hours.
Trading Halts
The Exchange would halt trading in the Notes if the circuit breaker
parameters of Exchange Rule 117 have been reached. In exercising its
discretion to halt or suspend trading in the Notes, the Exchange may
consider factors such as those set forth in Exchange Rule 918C(b), in
addition to other factors that may be relevant. In particular, if the
Index value is not being disseminated as required, the Exchange may
halt trading during the day in which the interruption to the
dissemination of the Index value occurs. If the interruption to the
dissemination of the Index value persists past the trading day in which
it occurred, the Exchange would halt trading no later than the
beginning of the trading day following the interruption.
The Exchange represents that its surveillance procedures are
adequate to properly monitor the trading of the Notes. Amex, has stated
that it would rely on its existing surveillance procedures governing
index-linked securities. The Exchange currently has in place an
Information Sharing Agreement with the Stock Exchange of Hong Kong for
the purpose of providing information in connection with trading in or
related to the components comprising the Index.
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 cooperation 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.
---------------------------------------------------------------------------
\14\ 15 U.S.C. 78f(b).
\15\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
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. 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 so finding or (ii) as to
which the self-regulatory organization 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.
Amex has requested accelerated approval of this proposed rule
change, as amended, prior to the 30th day after the date of publication
of the notice of the filing thereof, following the conclusion of a 15-
day comment period. The Commission has determined that a 15-day comment
period is appropriate before taking any action.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change, as amended, is consistent with the Act. Comments may be
submitted by any of the following methods:
Electronic Comments
Use the Commission's Internet comment form at https://
www.sec.gov/rules/sro.shtml or send an e-mail to rule-comments@sec.gov.
Please include File No. SR-Amex-2006-90 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File No. SR-Amex-2006-90. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site at https://www.sec.gov/rules/
sro.shtml. 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
[[Page 77426]]
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 Room, 100 F Street, NE., Washington, DC 20549. Copies of such
filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File No. SR-Amex-2006-90 and should be submitted on or before January
10, 2007.
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\16\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\16\
Nancy M. Morris
Secretary.
BILLING CODE 8011-01-P
[[Page 77427]]
[GRAPHIC] [TIFF OMITTED] TN26DE06.002
[[Page 77428]]
[FR Doc. 06-9844 Filed 12-22-06; 8:45 am]
BILLING CODE 8011-01-C
