[Federal Register Volume 60, Number 21 (Wednesday, February 1, 1995)]
[Notices]
[Pages 6324-6325]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-2384]



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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-35278; File No. SR-CBOE-95-02]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the Chicago Board Options Exchange, Inc. Relating to the 
Listing of Long-Term Index Options Series (``LEAPS'') With a Duration 
of Up to Sixty Months Until Expiration

January 25, 1995.
    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 January 19, 1995, the Chicago Board Options Exchange (``CBOE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the CBOE. The 
Commission is publishing this notice to [[Page 6325]] solicit comments 
on the proposed rule change from interested persons.

    \1\15 U.S.C. Sec. 78s(b)(1) (1988).
    \2\17CFR 240.19b-4 (1991).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The CBOE hereby proposes to amend Exchange Rule 24.9 to permit the 
listing of long-term index option series (``LEAPS'') with a duration of 
up to sixty months (five years). The text of the proposed rule change 
is available at the Office of the Secretary, CBOE, and at the 
Commission.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the 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 placed specified in 
Item IV below. The CBOE has prepared summaries set forth in Sections 
(A), (B), and (C) below, of the most significant aspects of such 
statements.

(A) Self-Regulatory Organizations's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The purpose of the proposed rule change is to permit the Exchange 
to list index LEAPS with a duration of up to sixty months (five 
years).\3\ Presently, the Exchange has authority pursuant to CBOE Rule 
24.9(b) to list index LEAPS that expire from twelve to thirty-six 
months from the time they are listed. The Exchange represents that 
there has been increasing member firm and customer interest in longer 
term instruments. The Exchange, therefore, is proposing to amend 
Exchange Rule 24.9 to permit the listing of index options with up to 
sixth months until expiration. In addition, the Exchange proposes to 
amend Rule 24.9 to allow for up to ten additional expiration months for 
index LEAPS, as opposed to the six additional months currently allowed.

    \3\The Exchange withdrew its proposed rule change to list equity 
LEAPS with a duration of up to five years. See Securities Exchange 
Act Release No. 35032 (November 30, 1994), 59 FR 63149 (December 7, 
1994) (notice of File No. SR-CBOE-94-42) and letter from Nancy L. 
Nielsen, Assistant Corporate Secretary, CBOE, to Sharon Lawson, 
Assistant Director, Office of Market Supervision Division of Market 
Regulation, Commission, Dated January 18, 1995.
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    The Exchange believes that the proposed rule change is consistent 
with Section 6 of the Act, in general, and furthers the objectives of 
Section 6(b)(5) of the Act,\4\ 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, to remove impediments to and perfect the mechanism of a 
free and open market and a national market system, and to protect 
investors and the public interest.

    \4\15 U.S.C. Sec. 78f(b)(5) (1988).
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any inappropriate burden on competition.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants, or Others

    Written comments on the proposed rule change were neither solicited 
nor received.

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 Exchange consents, the Commission will:
    (a) By order approve such proposed rule change, or
    (b) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549. 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for inspection and copying in the 
Commission's Public Reference Section, 450 Fifth Street, NW., 
Washington, DC Copies of such filing will also be available for 
inspection and copying at the principal office of the CBOE. All 
submissions should refer to File No. SR-CBOE-95-02 and should be 
submitted by February 22, 1995.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\

    \5\17 CFR 200.30-3(a)(12) (1994)
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Margaret H. McFarland,
Deputy Secretary,
[FR Doc. 95-2384 Filed 1-31-95; 8:45 am]
BILLING CODE 8010-01-M