Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1 and 2, Relating to the Definition of and Listing Standards for Equity-Linked Notes under NYSE Arca Equities Rules 5.1(b)(14) and 5.2(j)(2), 70918-70921 [E7-24134]

Download as PDF 70918 Federal Register / Vol. 72, No. 239 / Thursday, December 13, 2007 / Notices arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments BILLING CODE 8011–01–P • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSE–2007–111 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. mstockstill on PROD1PC66 with NOTICES For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–24083 Filed 12–12–07; 8:45 am] All submissions should refer to File Number SR–NYSE–2007–111. 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 (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 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, on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the NYSE. 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 Number SR–NYSE–2007–111 and should be submitted on or before January 3, 2008. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56924; File No. SR– NYSEArca–2007–98] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Order Granting Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1 and 2, Relating to the Definition of and Listing Standards for Equity-Linked Notes under NYSE Arca Equities Rules 5.1(b)(14) and 5.2(j)(2) December 7, 2007. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (‘‘Act’’),2 and Rule 19b–4 thereunder,3 notice is hereby given that on September 25, 2007, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’), through its wholly-owned subsidiary NYSE Arca Equities, Inc. (‘‘NYSE Arca Equities’’), filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule changes as described in Items I and II below, which items have been prepared by the Exchange. On October 23, 2007, the Exchange submitted Amendment No. 1 to the proposed rule change. On December 5, 2007, the Exchange submitted Amendment No. 2 to the proposed rule change. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons, and is granting accelerated approval to the proposed rule change. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange, through its whollyowned subsidiary NYSE Arca Equities, proposes to amend its rules governing NYSE Arca, LLC (also referred to as the ‘‘NYSE Arca Marketplace’’), which is the equities trading facility of NYSE Arca Equities. The Exchange is proposing to amend NYSE Arca Equities Rules 5.1(b)(14), the Exchange’s definition of Equity-Linked Notes (‘‘ELNs’’), and 5.2(j)(2), the Exchange’s 13 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 VerDate Aug<31>2005 17:10 Dec 12, 2007 Jkt 214001 PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 listing standards for ELNs, to provide for greater flexibility in the listing criteria for ELNs. The text of the proposed rule change is available at the Exchange, the Commission’s Public Reference Room, and https://www.nyse.com. 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 III below. The NYSE Arca 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 amend NYSE Arca Equities Rules 5.1(b)(14), the Exchange’s definition of ELNs, and 5.2(j)(2), the Exchange’s listing standards for ELNs, to provide for greater flexibility in the listing criteria for ELNs, as set forth below.4 The Exchange notes that the Commission has approved similar proposals by the American Stock Exchange LLC (‘‘Amex’’).5 4 NYSE Arca Equities Rule 5.2(j)(2) was approved by the Commission in September 1996, and was amended once in 2004. See Securities Exchange Act Release Nos. 37648 (September 5, 1996), 61 FR 48195 (September 12, 1996) (SR–PSE–96–23) and 50319 (September 7, 2004), 69 FR 55204 (September 13, 2004) (SR–PCX–2004–75). 5 Amex’s initial listing standards for ELNs are set forth in Section 107A of the Amex Company Guide, which was approved by the Commission in March 1990, and Section 107B of the Amex Company Guide, which was approved by the Commission in May 1993. These sections have been amended several times. The filings that are relevant to the topics discussed in this filing are as follows. See Securities Exchange Act Release Nos. 27753 (March 1, 1990), 55 FR 8626 (March 8, 1990) (SR–Amex– 89–29) (‘‘Amex March 1990 Release’’); 32343 (May 20, 1993), 58 FR 30833 (May 27, 1993) (SR–Amex– 92–42) (‘‘Amex May 1993 Release’’); 34549 (August 18, 1994), 59 FR 43873 (August 25, 1994) (SR– Amex–93–46) (‘‘Amex August 1994 Release’’); 36990 (March 20, 1996), 61 FR 13545 (March 27, 1996) (SR–Amex–95–44) (‘‘Amex March 1996 Release’’); 37783 (October 4, 1996), 61 FR 53246 (October 10, 1996) (SR–Amex–96–31) (‘‘Amex October 1996 Release’’); 47055 (December 19, 2002), 67 FR 79669 (December 30, 2002) (SR–Amex–2002– 110) (‘‘Amex December 2002 Release’’); and 55733 (May 10, 2007), 72 FR 27602 (May 16, 2007) (SR– Amex–2007–34) (‘‘Amex May 2007 Release’’) (collectively ‘‘Amex Releases’’). E:\FR\FM\13DEN1.SGM 13DEN1 mstockstill on PROD1PC66 with NOTICES Federal Register / Vol. 72, No. 239 / Thursday, December 13, 2007 / Notices Number of Linked Securities. NYSE Arca Equities Rule 5.1(b)(14) currently defines ELNs as notes that are linked, in whole or in part, to the market performance of a common stock, nonconvertible preferred stock, or sponsored American Depositary Receipts (‘‘ADRs’’), which may also be referred to as American Depositary Shares (‘‘ADSs’’), overlying such equity securities. The Exchange proposes to amend the definition to simply state that ELNs are defined as notes that are linked, in whole or in part, to the market performance of up to thirty common stocks or non-convertible preferred stocks. This change conforms to Section 107B of the Amex Company Guide.6 The Exchange proposes to expand the number of stocks that may be linked to ELNs in order to accommodate the varying types of ELN products that are currently offered in the marketplace. The Exchange believes that expanding the number of stocks that may be linked to ELNs will also provide investors with enhanced investment flexibility. The Exchange also believes that there would be no investor protection concerns with expanding the number of stocks linked to ELNs because each linked stock is required to individually satisfy the applicable listing standards set forth in Rule 5.2(j)(2). The Exchange also proposes to delete the reference to ADRs in Rule 5.1(b)(14), as such matter is covered in the listing standards. Issuer Listing Standards. Rule 5.2(j)(2)(A) currently provides that the issuer of ELNs must be an entity that is listed on a national securities exchange (or an affiliate of a listed company), with a minimum net worth of $150 million. Further, Rule 5.2(j)(2)(A) provides that the market value of an ELN offering, when combined with the market value of all other ELN offerings previously completed by the issuer and currently traded on a national securities exchange, may not be greater than 25% of the issuer’s net worth at the time of issuance. The Exchange proposes to amend the issuer listing standards under Rule 5.2(j)(2)(A) to provide for alternative minimum tangible net worth criteria for issuers of ELNs, similar to Section 107B(c) of the Amex Company Guide.7 Under the proposed Rule, an issuer with minimum tangible net worth in excess of $250 million and otherwise substantially exceeds the pre-tax income from continuing operations of at least $750,000 in its last fiscal year, or in two 6 See Amex December 2002 Release, note 5, supra. 7 See Amex October 1996 Release, note 5, supra. VerDate Aug<31>2005 17:10 Dec 12, 2007 Jkt 214001 of its last three fiscal years will not be limited to offerings of ELNs that do not exceed 25% of its 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 public interest. Moreover, the Exchange believes that these changes will not have an adverse impact on the market for ELNs nor its investors since issuers with the lower net worth of $150 million will still be required to limit the amount of their ELN offerings to 25% of their net worth. ELNs are dependent upon the individual credit of the issuer. This heightens the possibility that a holder of an ELN may not be able to receive full cash settlement at maturity. The Exchange believes that the proposed alternative net worth standard above, in addition to the proposed additional financial requirements set forth below, reasonably addresses this additional credit risk, and may even serve to minimize this risk. The Exchange also proposes to amend the issuer listing standards under Rule 5.2(j)(2)(A) to apply additional financial standards to issuers, in addition to net worth, which correspond to those set forth in Section 107A(a) of the Amex Company Guide.8 Specifically, the Exchange proposes to amend the issuer listing standards to require that an issuer of ELNs must have assets in excess of $100 million and stockholders’ equity of at least $10 million. In addition, the Exchange proposes to amend the issuer listing standards to require that an issuer of ELNs must have one of the following: (i) Pre-tax income from continuing operations of at least $750,000 in its last fiscal year, or in two of its last three fiscal years; (ii) assets in excess of $200 million and stockholders’ equity of at least $10 million; or (iii) assets in excess of $100 million and stockholders’ equity of at least $20 million. The Exchange proposes these additional financial standards to ensure that only the more financially sound companies will be eligible to have their ELNs listed on the Exchange. The Exchange believes that this is important considering the additional or contingent financial obligations created by ELNs, and should serve to protect investors and the public interest by ensuring that the ELNs listed on the Exchange have met predetermined financial criteria set by the Exchange. ELN Listing Standards. Rule 5.2(j)(2)(B) currently provides that an 8 See PO 00000 Amex March 1990 Release, note 5, supra. Frm 00104 Fmt 4703 Sfmt 4703 70919 issue of ELNs must have a minimum public distribution of one million ELNs, a minimum of 400 holders (provided, however, that if the ELN is traded in $1,000 denominations, there is no minimum number of holders), a minimum market value of $4 million, and a minimum term of one year. The Exchange proposes to add an exception to the minimum public distribution standard in Rule 5.2(j)(2)(B) to provide that if the ELN is traded in $1,000 denominations, there is no minimum public distribution requirement. This change corresponds to Section 107A(b) of the Amex Company Guide.9 The Exchange notes that, without the exception to the one million ELN minimum public distribution requirement, the Exchange would be unable to list ELNs in $1,000 dollar denominations having a market value of less than $1 billion. The Exchange believes that the proposed exception is a reasonable accommodation for those issuances in $1,000 denominations. In addition, the Exchange proposes to add an exception to the holders requirement in Rule 5.2(j)(2)(B) to provide that if the ELNs are redeemable at the option of the holders thereof on at least a weekly basis, there is no minimum number of holders. This change also corresponds to Section 107A(b) of the Amex Company Guide.10 The Exchange recently submitted a proposal to the Commission to add this exception to NYSE Arca Equities Rule 5.2(j)(6) (‘‘Index-Linked Securities’’),11 which was based on a rule proposal by the New York Stock Exchange LLC recently approved by the Commission.12 The Exchange also proposes to clarify that the holders requirement applies to ‘‘public’’ holders only. The Exchange believes that a weekly redemption right will ensure a strong correlation between the market price of the ELNs and the performance of the underlying asset, such as a single security or basket of securities and/or securities index, as holders will be unlikely to sell their securities for less than their redemption value if they have a weekly right to redeem such securities for their full value. In addition, in the case of certain ELNs with a weekly redemption feature, the issuer may have the ability to issue new ELNs from time to time at market prices prevailing at the 9 See Amex May 2007 Release, note 5, supra. 10 Id. 11 See Securities Exchange Act Release No. 56593 (October 1, 2007), 72 FR 57362 (October 9, 2007) (SR–NYSEArca–2007–96). 12 See Securities Exchange Act Release No. 56271 (August 16, 2007), 72 FR 47107 (August 22, 2007) (SR–NYSE–2007–74). E:\FR\FM\13DEN1.SGM 13DEN1 mstockstill on PROD1PC66 with NOTICES 70920 Federal Register / Vol. 72, No. 239 / Thursday, December 13, 2007 / Notices time of sale, at prices related to market prices, or at negotiated prices. This provides a ready supply of new ELNs, thereby lessening the possibility that the market price of such securities will be affected by a scarcity of available ELNs for sale. The Exchange believes that it also assists in maintaining a strong correlation between the market price and the indicative value, as investors will be unlikely to pay more than the indicative value in the open market if they can acquire ELNs from the issuer at that price. The Exchange believes that the ability to list ELNs with these characteristics without any minimum number of units issued or holders is important to the successful listing of such securities. Issuers issuing these types of ELNs generally do not intend to do so by way of an underwritten offering. Rather, the distribution arrangement is analogous to that of an exchange traded fund issuance, in that the issue is launched without any significant distribution event and the float increases over time as investors purchase additional securities from the issuer at the then indicative value. Investors will generally seek to purchase the securities at a point when the underlying index is at a level that they perceive as providing an attractive growth opportunity. In the context of such a distribution arrangement, it is difficult for an issuer to guarantee its ability to sell a specific number of units on the listing date. However, the Exchange believes that this difficulty in ensuring the sale of one million units or 400 public holders on the listing date is not indicative of a likely long-term lack of liquidity in the securities or, for the reasons set forth in the prior paragraph, of a difficulty in establishing a pricing equilibrium in the securities or a successful two-sided market. The Linked Securities. Rule 5.2(j)(2)(C) currently provides minimum standards applicable to the linked securities and the issuers of such securities. The Rule currently provides that the ELNs must be issued by either: (i) A U.S. company or (ii) a non-U.S. company that meets certain additional standards. The Exchange proposes to amend the language in the Rule to indicate that an issue of ELNs may be linked to more than one security and, therefore, more than one issuer of a security, in accordance with the Exchange’s proposed amendments to Rule 5.1(b)(14), as set forth above. In addition, the Exchange proposes to amend the requirement that the issuer be a U.S. company (in order not to have to meet additional standards of a nonU.S. company) to require that the issuer VerDate Aug<31>2005 17:10 Dec 12, 2007 Jkt 214001 be a reporting company under the Act listed on a national securities exchange. This change corresponds to Section 107B(e) of the Amex Company Guide.13 The Exchange proposes this revision in order to encompass non-U.S. companies that have reporting requirements under the federal securities laws, which better addresses the Exchange’s concern regarding the public availability of financial information for the issuers of the underlying securities. The Exchange believes that such information serves to protect investors and the public interest. In Rule 5.2(j)(2)(C) and (D), the Exchange also proposes certain minor changes in order to clarify certain language, including the language regarding common shares and American Depositary Shares (‘‘ADSs’’), generally conforming it to Section 107B(e) of the Amex Company Guide.14 In Rule 5.2(j)(2)(D), the Exchange also proposes to add the standard that if any non-U.S. security and related securities has less than 20% of the worldwide trading volume occurring in the U.S. market during the six month period preceding the date of listing, then the ELN may not be linked to that non-U.S. security. The Exchange believes that this standard makes sense in the context of the current Rule,15 and notes that it corresponds to Section 107B(f) of the Amex Company Guide.16 The Exchange believes that this additional standard is appropriate in that it limits the listing of ELNs linked to non-U.S. securities to those that have a significant amount of U.S. market trading volume, which provides reasonable assurance that the underlying non-U.S. securities are deliverable upon exercise of the ELNs. Additional Changes. In Rule 5.2(j)(2)(E), the Exchange currently provides that it will distribute an information circular to ETP Holders prior to the commencement of trading of particular ELNs in order to provide guidance to ETP Holders regarding compliance responsibilities (including suitability recommendations and account approval) when handling transactions in ELNs. The Exchange proposes to amend this requirement to provide that the Exchange will evaluate the nature and complexity of the issue and, if appropriate, distribute an 13 See Amex May 1993 Release, note 5, supra. Amex August 1994 Release, note 5, supra. 15 The current Rule provides that the issuance of ELNs relating to underlying non-U.S. securities cannot exceed certain percentage limits of the total outstanding shares of the underlying security. These percentage limits are tied to 20%, 50% and 70% of worldwide trading volume. Therefore, the Rule as currently in effect, does not contemplate less than 20% worldwide trading volume. 16 See Amex March 1996 Release, note 5, supra. information circular to ETP Holders, which conforms with Section 107A of the Amex Company Guide.17 In determining whether a circular is necessary, the Exchange will consider such characteristics of the issue as: Unit size and term; cash settlement; exercise or call provisions; characteristics that may affect payment of dividends and/or appreciation potential; whether the securities are primarily of retail or institutional interest; and such other features of the issue that might entail special risks not normally associated with securities currently listed on the Exchange. The Exchange proposes this change in order to allow the Exchange greater flexibility while still protecting investors. The Exchange also proposes to add new Rule 5.2(j)(2)(F), which provides that ELNs will be treated as equity instruments, in accordance with Section 107B(g) of the Amex Company Guide.18 The Exchange proposes this change to provide clarity to its ETP Holders that ELNs will be treated as equity instruments for, among other purposes, margin treatment. The Exchange also proposes to add that the Exchange may approve for listing and trading ELN’s pursuant to Rule 19b–4(e) under the Act if the requirements of proposed Rule 5.2(j)(2) are met.19 The Exchange proposes this change to clarify that this requirement applies to ELN’s. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,20 in general, and furthers the objectives of Section 6(b)(5) of the Act,21 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 engaging 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. 14 See PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 17 See Amex March 1990 Release, note 5, supra. Amex May 1993 Release, note 5, supra. 19 Telephone conference between Timothy J. Malinowski, Director, Exchange, and Michou H.M. Nguyen, Special Counsel, Division of Trading and Markets, Commission, on December 6, 2007. 20 15 U.S.C. 78f(b). 21 15 U.S.C. 78f(b)(5). 18 See E:\FR\FM\13DEN1.SGM 13DEN1 Federal Register / Vol. 72, No. 239 / Thursday, December 13, 2007 / Notices 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 mstockstill on PROD1PC66 with NOTICES No written comments were solicited, or received, with respect to the proposed rule change, by NYSE Arca. 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 number SR–NYSEArca–2007–98 and should be submitted by January 3, 2008. IV. Commission’s Findings and Order Granting Accelerated Approval of the Proposed Rule Change After careful consideration, the Commission finds that the proposed III. Solicitation of Comments rule change is consistent with the requirements of the Act and the rules Interested persons are invited to and regulations thereunder applicable to submit written data, views and a national securities exchange 22 and, in arguments concerning the foregoing, particular, the requirements of Section 6 including whether the proposed rule of the Act.23 Specifically, the change is consistent with the Act. Commission finds that the proposed Comments may be submitted by any of rule change is consistent with Section the following methods: 6(b)(5) of the Act,24 which requires, Electronic Comments among other things, that the rules of a national securities exchange be • Use the Commission’s Internet designed to promote just and equitable comment form (https://www.sec.gov/ principles of trade, to foster cooperation rules/sro.shtml); or and coordination with persons engaged • Send e-mail to rulein regulating, clearing, settling, comments@sec.gov. Please include File Number SR–NYSEArca–2007–98 on the processing information with respect to, and facilitating transactions in subject line. securities, to remove impediments to Paper Comments and perfect the mechanism of a free and • Send paper comments in triplicate open market and a national market to Nancy M. Morris, Secretary, system, and, in general, to protect Securities and Exchange Commission, investors and the public interest. 100 F Street, NE., Washington, DC The Commission finds good cause for 20549–1090. approving the proposed rule change prior to the 30th day after the date of All submissions should refer to File publication of the notice of filing thereof Number SR–NYSEArca–2007–98. This in the Federal Register. The proposal file number should be included on the subject line if e-mail is used. To help the seeks to conform the Exchange’s rules for ELNs to the rules of the Amex that Commission process and review your have previously been approved by the comments more efficiently, please use only one method. The Commission will Commission.25 Therefore, the post all comments on the Commission’s Commission does not believe that the Exchange’s proposal raises any novel Internet Web site (https://www.sec.gov/ regulatory issues. The Commission rules/sro.shtml). Copies of the believes that accelerating approval of submission, all subsequent this proposal should benefit investors amendments, all written statements by creating, without undue delay, with respect to the proposed rule additional competition in the market for change that are filed with the ELNs. Commission, and all written communications relating to the Therefore the Commission finds good proposed rule change between the cause, consistent with Section 19(b)(2) Commission and any person, other than of the Act,26 to approve the proposed those that may be withheld from the rule change on an accelerated basis. public in accordance with the provisions of 5 U.S.C. 552, will be 22 In approving this proposed rule change, the Commission has considered the proposed rule’s available for inspection and copying in impact on efficiency, competition, and capital the Commission’s Public Reference formation. 15 U.S.C. 78c(f). Room, 100 F Street, NE., Washington, 23 15 U.S.C. 78f. DC 20549, on official business days 24 15 U.S.C. 78f(b)(5). between the hours of 10 a.m. and 3 p.m. 25 See Amex Rules 101 and 107; see also Amex Copies of such filing also will be Release, note 5 supra. 26 15 U.S.C. 78s(b)(2). available for inspection and copying at VerDate Aug<31>2005 17:22 Dec 12, 2007 Jkt 214001 PO 00000 Frm 00106 Fmt 4703 Sfmt 4703 70921 V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,27 that the proposed rule change, as amended (SR– NYSEArca–2007–98), be, and it hereby is, approved on an accelerated basis. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.28 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–24134 Filed 12–12–07; 8:45 am] BILLING CODE 8011–01–P DEPARTMENT OF STATE [Public Notice 6025] Bureau of Educational and Cultural Affairs (ECA) Request for Grant Proposals: Global Connections and Exchange Program. Announcement Type: New Grant. Funding Opportunity Number: ECA/ PE/C/PY–08–13. Catalog of Federal Domestic Assistance Number: 00.000. Key Dates: Application Deadline: February 8, 2008. Executive Summary: The Youth Programs Division of the Bureau of Educational and Cultural Affairs announces an open competition for the Global Connections and Exchange program. Public and private non-profit organizations meeting the provisions described in Internal Revenue Code section 26 U.S.C. 501(c)(3) may submit proposals to administer the Global Connections and Exchange program in (1) Afghanistan and/or (2) the Palestinian Territories, West Bank only. The Bureau will award one grant for each program. The grantee organizations and/or their partners will select overseas schools and provide them with access to the Internet and related training to develop collaborative partnerships with U.S. schools. Thematic online projects will enhance mutual understanding as they encourage learning, research and free expression among participating schools. All Global Connections and Exchange activities will be undertaken in regular and consistent consultation with the Public Affairs Section (PAS) of the U.S. Embassy in Kabul and the U.S. Consulate in Jerusalem respectively. Please note that all Global Connections Exchange activities in the Palestinian Territories must be carried out according to all relevant laws and 27 15 28 17 E:\FR\FM\13DEN1.SGM U.S.C. 78s(b)(2). CFR 200.30–3(a)(12). 13DEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 72, Number 239 (Thursday, December 13, 2007)]
[Notices]
[Pages 70918-70921]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-24134]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56924; File No. SR-NYSEArca-2007-98]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Order Granting Accelerated Approval of Proposed Rule Change, as 
Modified by Amendment Nos. 1 and 2, Relating to the Definition of and 
Listing Standards for Equity-Linked Notes under NYSE Arca Equities 
Rules 5.1(b)(14) and 5.2(j)(2)

December 7, 2007.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act''),\2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that on September 25, 2007, NYSE Arca, Inc. (``NYSE Arca'' or 
``Exchange''), through its wholly-owned subsidiary NYSE Arca Equities, 
Inc. (``NYSE Arca Equities''), filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule changes as described in 
Items I and II below, which items have been prepared by the Exchange. 
On October 23, 2007, the Exchange submitted Amendment No. 1 to the 
proposed rule change. On December 5, 2007, the Exchange submitted 
Amendment No. 2 to the proposed rule change. The Commission is 
publishing this notice to solicit comments on the proposed rule change, 
as amended, from interested persons, and is granting accelerated 
approval to the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange, through its wholly-owned subsidiary NYSE Arca 
Equities, proposes to amend its rules governing NYSE Arca, LLC (also 
referred to as the ``NYSE Arca Marketplace''), which is the equities 
trading facility of NYSE Arca Equities. The Exchange is proposing to 
amend NYSE Arca Equities Rules 5.1(b)(14), the Exchange's definition of 
Equity-Linked Notes (``ELNs''), and 5.2(j)(2), the Exchange's listing 
standards for ELNs, to provide for greater flexibility in the listing 
criteria for ELNs.
    The text of the proposed rule change is available at the Exchange, 
the Commission's Public Reference Room, and https://www.nyse.com.

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 III below. The NYSE Arca 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 amend NYSE Arca Equities Rules 5.1(b)(14), 
the Exchange's definition of ELNs, and 5.2(j)(2), the Exchange's 
listing standards for ELNs, to provide for greater flexibility in the 
listing criteria for ELNs, as set forth below.\4\ The Exchange notes 
that the Commission has approved similar proposals by the American 
Stock Exchange LLC (``Amex'').\5\
---------------------------------------------------------------------------

    \4\ NYSE Arca Equities Rule 5.2(j)(2) was approved by the 
Commission in September 1996, and was amended once in 2004. See 
Securities Exchange Act Release Nos. 37648 (September 5, 1996), 61 
FR 48195 (September 12, 1996) (SR-PSE-96-23) and 50319 (September 7, 
2004), 69 FR 55204 (September 13, 2004) (SR-PCX-2004-75).
    \5\ Amex's initial listing standards for ELNs are set forth in 
Section 107A of the Amex Company Guide, which was approved by the 
Commission in March 1990, and Section 107B of the Amex Company 
Guide, which was approved by the Commission in May 1993. These 
sections have been amended several times. The filings that are 
relevant to the topics discussed in this filing are as follows. See 
Securities Exchange Act Release Nos. 27753 (March 1, 1990), 55 FR 
8626 (March 8, 1990) (SR-Amex-89-29) (``Amex March 1990 Release''); 
32343 (May 20, 1993), 58 FR 30833 (May 27, 1993) (SR-Amex-92-42) 
(``Amex May 1993 Release''); 34549 (August 18, 1994), 59 FR 43873 
(August 25, 1994) (SR-Amex-93-46) (``Amex August 1994 Release''); 
36990 (March 20, 1996), 61 FR 13545 (March 27, 1996) (SR-Amex-95-44) 
(``Amex March 1996 Release''); 37783 (October 4, 1996), 61 FR 53246 
(October 10, 1996) (SR-Amex-96-31) (``Amex October 1996 Release''); 
47055 (December 19, 2002), 67 FR 79669 (December 30, 2002) (SR-Amex-
2002-110) (``Amex December 2002 Release''); and 55733 (May 10, 
2007), 72 FR 27602 (May 16, 2007) (SR-Amex-2007-34) (``Amex May 2007 
Release'') (collectively ``Amex Releases'').

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[[Page 70919]]

    Number of Linked Securities. NYSE Arca Equities Rule 5.1(b)(14) 
currently defines ELNs as notes that are linked, in whole or in part, 
to the market performance of a common stock, non-convertible preferred 
stock, or sponsored American Depositary Receipts (``ADRs''), which may 
also be referred to as American Depositary Shares (``ADSs''), overlying 
such equity securities. The Exchange proposes to amend the definition 
to simply state that ELNs are defined as notes that are linked, in 
whole or in part, to the market performance of up to thirty common 
stocks or non-convertible preferred stocks. This change conforms to 
Section 107B of the Amex Company Guide.\6\ The Exchange proposes to 
expand the number of stocks that may be linked to ELNs in order to 
accommodate the varying types of ELN products that are currently 
offered in the marketplace. The Exchange believes that expanding the 
number of stocks that may be linked to ELNs will also provide investors 
with enhanced investment flexibility. The Exchange also believes that 
there would be no investor protection concerns with expanding the 
number of stocks linked to ELNs because each linked stock is required 
to individually satisfy the applicable listing standards set forth in 
Rule 5.2(j)(2). The Exchange also proposes to delete the reference to 
ADRs in Rule 5.1(b)(14), as such matter is covered in the listing 
standards.
---------------------------------------------------------------------------

    \6\ See Amex December 2002 Release, note 5, supra.
---------------------------------------------------------------------------

    Issuer Listing Standards. Rule 5.2(j)(2)(A) currently provides that 
the issuer of ELNs must be an entity that is listed on a national 
securities exchange (or an affiliate of a listed company), with a 
minimum net worth of $150 million. Further, Rule 5.2(j)(2)(A) provides 
that the market value of an ELN offering, when combined with the market 
value of all other ELN offerings previously completed by the issuer and 
currently traded on a national securities exchange, may not be greater 
than 25% of the issuer's net worth at the time of issuance.
    The Exchange proposes to amend the issuer listing standards under 
Rule 5.2(j)(2)(A) to provide for alternative minimum tangible net worth 
criteria for issuers of ELNs, similar to Section 107B(c) of the Amex 
Company Guide.\7\ Under the proposed Rule, an issuer with minimum 
tangible net worth in excess of $250 million and otherwise 
substantially exceeds the pre-tax income from continuing operations of 
at least $750,000 in its last fiscal year, or in two of its last three 
fiscal years will not be limited to offerings of ELNs that do not 
exceed 25% of its 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 public interest. Moreover, the Exchange 
believes that these changes will not have an adverse impact on the 
market for ELNs nor its investors since issuers with the lower net 
worth of $150 million will still be required to limit the amount of 
their ELN offerings to 25% of their net worth.
---------------------------------------------------------------------------

    \7\ See Amex October 1996 Release, note 5, supra.
---------------------------------------------------------------------------

    ELNs are dependent upon the individual credit of the issuer. This 
heightens the possibility that a holder of an ELN may not be able to 
receive full cash settlement at maturity. The Exchange believes that 
the proposed alternative net worth standard above, in addition to the 
proposed additional financial requirements set forth below, reasonably 
addresses this additional credit risk, and may even serve to minimize 
this risk.
    The Exchange also proposes to amend the issuer listing standards 
under Rule 5.2(j)(2)(A) to apply additional financial standards to 
issuers, in addition to net worth, which correspond to those set forth 
in Section 107A(a) of the Amex Company Guide.\8\ Specifically, the 
Exchange proposes to amend the issuer listing standards to require that 
an issuer of ELNs must have assets in excess of $100 million and 
stockholders' equity of at least $10 million. In addition, the Exchange 
proposes to amend the issuer listing standards to require that an 
issuer of ELNs must have one of the following: (i) Pre-tax income from 
continuing operations of at least $750,000 in its last fiscal year, or 
in two of its last three fiscal years; (ii) assets in excess of $200 
million and stockholders' equity of at least $10 million; or (iii) 
assets in excess of $100 million and stockholders' equity of at least 
$20 million.
---------------------------------------------------------------------------

    \8\ See Amex March 1990 Release, note 5, supra.
---------------------------------------------------------------------------

    The Exchange proposes these additional financial standards to 
ensure that only the more financially sound companies will be eligible 
to have their ELNs listed on the Exchange. The Exchange believes that 
this is important considering the additional or contingent financial 
obligations created by ELNs, and should serve to protect investors and 
the public interest by ensuring that the ELNs listed on the Exchange 
have met predetermined financial criteria set by the Exchange.
    ELN Listing Standards. Rule 5.2(j)(2)(B) currently provides that an 
issue of ELNs must have a minimum public distribution of one million 
ELNs, a minimum of 400 holders (provided, however, that if the ELN is 
traded in $1,000 denominations, there is no minimum number of holders), 
a minimum market value of $4 million, and a minimum term of one year.
    The Exchange proposes to add an exception to the minimum public 
distribution standard in Rule 5.2(j)(2)(B) to provide that if the ELN 
is traded in $1,000 denominations, there is no minimum public 
distribution requirement. This change corresponds to Section 107A(b) of 
the Amex Company Guide.\9\ The Exchange notes that, without the 
exception to the one million ELN minimum public distribution 
requirement, the Exchange would be unable to list ELNs in $1,000 dollar 
denominations having a market value of less than $1 billion. The 
Exchange believes that the proposed exception is a reasonable 
accommodation for those issuances in $1,000 denominations.
---------------------------------------------------------------------------

    \9\ See Amex May 2007 Release, note 5, supra.
---------------------------------------------------------------------------

    In addition, the Exchange proposes to add an exception to the 
holders requirement in Rule 5.2(j)(2)(B) to provide that if the ELNs 
are redeemable at the option of the holders thereof on at least a 
weekly basis, there is no minimum number of holders. This change also 
corresponds to Section 107A(b) of the Amex Company Guide.\10\ The 
Exchange recently submitted a proposal to the Commission to add this 
exception to NYSE Arca Equities Rule 5.2(j)(6) (``Index-Linked 
Securities''),\11\ which was based on a rule proposal by the New York 
Stock Exchange LLC recently approved by the Commission.\12\ The 
Exchange also proposes to clarify that the holders requirement applies 
to ``public'' holders only.
---------------------------------------------------------------------------

    \10\ Id.
    \11\ See Securities Exchange Act Release No. 56593 (October 1, 
2007), 72 FR 57362 (October 9, 2007) (SR-NYSEArca-2007-96).
    \12\ See Securities Exchange Act Release No. 56271 (August 16, 
2007), 72 FR 47107 (August 22, 2007) (SR-NYSE-2007-74).
---------------------------------------------------------------------------

    The Exchange believes that a weekly redemption right will ensure a 
strong correlation between the market price of the ELNs and the 
performance of the underlying asset, such as a single security or 
basket of securities and/or securities index, as holders will be 
unlikely to sell their securities for less than their redemption value 
if they have a weekly right to redeem such securities for their full 
value. In addition, in the case of certain ELNs with a weekly 
redemption feature, the issuer may have the ability to issue new ELNs 
from time to time at market prices prevailing at the

[[Page 70920]]

time of sale, at prices related to market prices, or at negotiated 
prices. This provides a ready supply of new ELNs, thereby lessening the 
possibility that the market price of such securities will be affected 
by a scarcity of available ELNs for sale. The Exchange believes that it 
also assists in maintaining a strong correlation between the market 
price and the indicative value, as investors will be unlikely to pay 
more than the indicative value in the open market if they can acquire 
ELNs from the issuer at that price.
    The Exchange believes that the ability to list ELNs with these 
characteristics without any minimum number of units issued or holders 
is important to the successful listing of such securities. Issuers 
issuing these types of ELNs generally do not intend to do so by way of 
an underwritten offering. Rather, the distribution arrangement is 
analogous to that of an exchange traded fund issuance, in that the 
issue is launched without any significant distribution event and the 
float increases over time as investors purchase additional securities 
from the issuer at the then indicative value. Investors will generally 
seek to purchase the securities at a point when the underlying index is 
at a level that they perceive as providing an attractive growth 
opportunity. In the context of such a distribution arrangement, it is 
difficult for an issuer to guarantee its ability to sell a specific 
number of units on the listing date. However, the Exchange believes 
that this difficulty in ensuring the sale of one million units or 400 
public holders on the listing date is not indicative of a likely long-
term lack of liquidity in the securities or, for the reasons set forth 
in the prior paragraph, of a difficulty in establishing a pricing 
equilibrium in the securities or a successful two-sided market.
    The Linked Securities. Rule 5.2(j)(2)(C) currently provides minimum 
standards applicable to the linked securities and the issuers of such 
securities. The Rule currently provides that the ELNs must be issued by 
either: (i) A U.S. company or (ii) a non-U.S. company that meets 
certain additional standards. The Exchange proposes to amend the 
language in the Rule to indicate that an issue of ELNs may be linked to 
more than one security and, therefore, more than one issuer of a 
security, in accordance with the Exchange's proposed amendments to Rule 
5.1(b)(14), as set forth above. In addition, the Exchange proposes to 
amend the requirement that the issuer be a U.S. company (in order not 
to have to meet additional standards of a non-U.S. company) to require 
that the issuer be a reporting company under the Act listed on a 
national securities exchange. This change corresponds to Section 
107B(e) of the Amex Company Guide.\13\ The Exchange proposes this 
revision in order to encompass non-U.S. companies that have reporting 
requirements under the federal securities laws, which better addresses 
the Exchange's concern regarding the public availability of financial 
information for the issuers of the underlying securities. The Exchange 
believes that such information serves to protect investors and the 
public interest.
---------------------------------------------------------------------------

    \13\ See Amex May 1993 Release, note 5, supra.
---------------------------------------------------------------------------

    In Rule 5.2(j)(2)(C) and (D), the Exchange also proposes certain 
minor changes in order to clarify certain language, including the 
language regarding common shares and American Depositary Shares 
(``ADSs''), generally conforming it to Section 107B(e) of the Amex 
Company Guide.\14\ In Rule 5.2(j)(2)(D), the Exchange also proposes to 
add the standard that if any non-U.S. security and related securities 
has less than 20% of the worldwide trading volume occurring in the U.S. 
market during the six month period preceding the date of listing, then 
the ELN may not be linked to that non-U.S. security. The Exchange 
believes that this standard makes sense in the context of the current 
Rule,\15\ and notes that it corresponds to Section 107B(f) of the Amex 
Company Guide.\16\ The Exchange believes that this additional standard 
is appropriate in that it limits the listing of ELNs linked to non-U.S. 
securities to those that have a significant amount of U.S. market 
trading volume, which provides reasonable assurance that the underlying 
non-U.S. securities are deliverable upon exercise of the ELNs.
---------------------------------------------------------------------------

    \14\ See Amex August 1994 Release, note 5, supra.
    \15\ The current Rule provides that the issuance of ELNs 
relating to underlying non-U.S. securities cannot exceed certain 
percentage limits of the total outstanding shares of the underlying 
security. These percentage limits are tied to 20%, 50% and 70% of 
worldwide trading volume. Therefore, the Rule as currently in 
effect, does not contemplate less than 20% worldwide trading volume.
    \16\ See Amex March 1996 Release, note 5, supra.
---------------------------------------------------------------------------

    Additional Changes. In Rule 5.2(j)(2)(E), the Exchange currently 
provides that it will distribute an information circular to ETP Holders 
prior to the commencement of trading of particular ELNs in order to 
provide guidance to ETP Holders regarding compliance responsibilities 
(including suitability recommendations and account approval) when 
handling transactions in ELNs. The Exchange proposes to amend this 
requirement to provide that the Exchange will evaluate the nature and 
complexity of the issue and, if appropriate, distribute an information 
circular to ETP Holders, which conforms with Section 107A of the Amex 
Company Guide.\17\ In determining whether a circular is necessary, the 
Exchange will consider such characteristics of the issue as: Unit size 
and term; cash settlement; exercise or call provisions; characteristics 
that may affect payment of dividends and/or appreciation potential; 
whether the securities are primarily of retail or institutional 
interest; and such other features of the issue that might entail 
special risks not normally associated with securities currently listed 
on the Exchange. The Exchange proposes this change in order to allow 
the Exchange greater flexibility while still protecting investors.
---------------------------------------------------------------------------

    \17\ See Amex March 1990 Release, note 5, supra.
---------------------------------------------------------------------------

    The Exchange also proposes to add new Rule 5.2(j)(2)(F), which 
provides that ELNs will be treated as equity instruments, in accordance 
with Section 107B(g) of the Amex Company Guide.\18\ The Exchange 
proposes this change to provide clarity to its ETP Holders that ELNs 
will be treated as equity instruments for, among other purposes, margin 
treatment.
---------------------------------------------------------------------------

    \18\ See Amex May 1993 Release, note 5, supra.
---------------------------------------------------------------------------

    The Exchange also proposes to add that the Exchange may approve for 
listing and trading ELN's pursuant to Rule 19b-4(e) under the Act if 
the requirements of proposed Rule 5.2(j)(2) are met.\19\ The Exchange 
proposes this change to clarify that this requirement applies to ELN's.
---------------------------------------------------------------------------

    \19\ Telephone conference between Timothy J. Malinowski, 
Director, Exchange, and Michou H.M. Nguyen, Special Counsel, 
Division of Trading and Markets, Commission, on December 6, 2007.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\20\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\21\ 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 engaging 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.
---------------------------------------------------------------------------

    \20\ 15 U.S.C. 78f(b).
    \21\ 15 U.S.C. 78f(b)(5).

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[[Page 70921]]

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

    No written comments were solicited, or received, with respect to 
the proposed rule change, by NYSE Arca.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
     Send e-mail to rule-comments@sec.gov. Please include File 
Number SR-NYSEArca-2007-98 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 Number SR-NYSEArca-2007-98. 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 (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 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, on official business days between the hours 
of 10 a.m. and 3 p.m. 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 number SR-NYSEArca-2007-98 and should 
be submitted by January 3, 2008.

IV. Commission's Findings and Order Granting Accelerated Approval of 
the Proposed Rule Change

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to a national securities 
exchange \22\ and, in particular, the requirements of Section 6 of the 
Act.\23\ Specifically, the Commission finds that the proposed rule 
change is consistent with Section 6(b)(5) of the Act,\24\ which 
requires, among other things, that the rules of a national securities 
exchange be 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.
---------------------------------------------------------------------------

    \22\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. 15 U.S.C. 78c(f).
    \23\ 15 U.S.C. 78f.
    \24\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Commission finds good cause for approving the proposed rule 
change prior to the 30th day after the date of publication of the 
notice of filing thereof in the Federal Register. The proposal seeks to 
conform the Exchange's rules for ELNs to the rules of the Amex that 
have previously been approved by the Commission.\25\ Therefore, the 
Commission does not believe that the Exchange's proposal raises any 
novel regulatory issues. The Commission believes that accelerating 
approval of this proposal should benefit investors by creating, without 
undue delay, additional competition in the market for ELNs.
---------------------------------------------------------------------------

    \25\ See Amex Rules 101 and 107; see also Amex Release, note 5 
supra.
---------------------------------------------------------------------------

    Therefore the Commission finds good cause, consistent with Section 
19(b)(2) of the Act,\26\ to approve the proposed rule change on an 
accelerated basis.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\27\ that the proposed rule change, as amended (SR-NYSEArca-2007-
98), be, and it hereby is, approved on an accelerated basis.
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\28\
---------------------------------------------------------------------------

    \28\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-24134 Filed 12-12-07; 8:45 am]
BILLING CODE 8011-01-P

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