[Federal Register Volume 61, Number 117 (Monday, June 17, 1996)]
[Notices]
[Pages 30650-30653]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-15274]



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

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37298; File Nos. SR-OCC-96-04 and SR-NSCC-96-11]


Self-Regulatory Organizations; The Options Clearing Corporation; 
National Securities Clearing Corporation; Notice of Filing of Proposed 
Rule Changes Relating to an Amended and Restated Options Exercise 
Settlement Agreement Between the Options Clearing Corporation and the 
National Securities Clearing Corporation

June 10, 1996.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on February 6, 1996, and 
April 6, 1996, The Options Clearing Corporation (``OCC'') and the 
National Securities Clearing Corporation (``NSCC''), respectively, 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule changes (File Nos. SR-OCC-96-04 and SR-NSCC-96-11) as 
described in Items I, II, and III below, which items have been prepared 
primarily by OCC and NSCC, respectively. The Commission is publishing 
this notice to solicit comments on the proposed rule changes from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. Sec. 78s(b)(1) (1988).
---------------------------------------------------------------------------

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

    The purpose of the proposed rule changes is to put into effect the 
Third Amended and Restated Options Exercise Settlement Agreement 
(``Third Restated Agreement'') \2\ between OCC and NSCC providing for 
the settlement of exercises and assignments of equity options.\3\ The 
proposal also seeks to make related changes to OCC's Rules, primarily 
to Rule 601, which sets forth the calculation of margin requirements 
for equity options, and to make related changes in NSCC's clearing fund 
formula in order to exclude from the clearing fund calculation trades 
for which NSCC has protection under the terms of the Third Restated 
Agreement.
---------------------------------------------------------------------------

    \2\ A copy of the executed Third Restated Agreement is attached 
as Exhibit A to OCC's and to NSCC's filings. A copy of each of the 
filings and all exhibits is available for copying and inspection in 
the Commission's Public Reference Room or through OCC or NSCC, 
respectively.
    \3\ OCC has provided Stock Clearing Corporation of Philadelphia 
(``SCCP'') with a Third Restated Agreement which has terms 
substantially parallel to the terms of the Third Restated Agreement 
between OCC and NSCC. OCC has advised SCCP that it is prepared to 
execute a Third Restated Agreement with SCCP if and when SCCP wishes 
to do so. Because Midwest Clearing Corporation (``MCC'') has 
withdrawn from the clearance and settlement business, OCC plans to 
propose entering into a termination agreement with MCC to formally 
terminate the Second Restated Agreement between OCC and MCC.
---------------------------------------------------------------------------

II. Self-Regulatory Organizations' Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Changes

    In their filings with the Commission, OCC and NSCC included 
statements concerning the purpose of and basis for the proposed rule 
changes and discussed any comments they received on the proposed rule 
changes. The text of these statements may be examined at the places 
specified in Item IV below. OCC and NSCC have prepared summaries, set 
forth in sections (A), (B), and (C) below, of the most significant 
aspects of such statements.\4\
---------------------------------------------------------------------------

    \4\ The Commission has modified the text of the summaries 
prepared by OCC and NSCC.
---------------------------------------------------------------------------

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

    In 1977, OCC signed an Options Exercise Settlement Agreement with 
Stock Clearing Corporation (NSCC's predecessor), with MCC, and with 
SCCP. In 1991, OCC and NSCC, MCC, and SCCP each signed a Restated 
Options Exercise Agreement (``Restated Agreements''). The Restated 
Agreements never became effective because in 1993, prior to Commission 
approval of proposed rule changes pertaining to these Restated 
Agreements, OCC and NSCC, MCC, and SCCP each signed a Second Restated 
Options Exercise Agreement (``Second Restated Agreements'').\5\ The 
Commission approved the proposed rule changes pertaining to the Second 
Restated Agreements.\6\ However, after the proposals were approved the 
parties to the Second Restated Agreements agreed to suspend the 
effectiveness of those agreements because OCC's proposed implementation 
of a two product group margin system would have caused increases in the 
margin requirements far in excess of the increases which had been 
anticipated when the Second Restated Agreements were originally 
proposed. The Second Restated Agreements never became effective.
---------------------------------------------------------------------------

    \5\ The three Second Restated Agreements were filed by OCC with 
the Commission in Amendment No. 2 to File No. SR-OCC-92-5, and also 
were filed by NSCC, SCCP, and MCC in amendments to File No. SR-NSCC-
91-7, File No. SR-SCCP-92-01, and File No. SR-MCC-92-02, 
respectively.
    \6\ Securities Exchange Act Release No. 33543 (January 28, 
1994), 59 FR 5639 [File Nos. SR-OCC-92-05, SR-NSCC-91-07, SR-SCCP-
92-01, and SR-MCC-92-02].
---------------------------------------------------------------------------

    OCC and NSCC now propose to make effective the Third Restated 
Agreement executed by them. The Third Restated Agreement will become 
effective upon approval by the Commission of the proposed rule changes 
herein.
Changes Made by the Third Restated Agreements
    The Third Restated Agreement alters the provisions of the Second 
Restated Agreement between OCC and NSCC principally to establish a two-
way guarantee between OCC and NSCC and to change the guarantee 
formulas. In the Second Restated Agreement, OCC guaranteed compensation 
to NSCC for losses incurred by NSCC in closing out the exercise and 
assignment activity (``E&A activity'') of a defaulting OCC clearing 
member, and NSCC agreed to guarantee settlement of pending stock trades 
arising from E&A activity commencing at the same time that it 
guarantees regular-way settlements of ordinary stock transactions 
(i.e., at midnight of T+1). However, the Second Restated Agreement did 
not require NSCC to return to OCC any net value remaining from the 
liquidation of the E&A activity of a defaulting clearing member. As a 
result, OCC provided for a two product group margin system for equity 
options to ensure that OCC gave no margin credit for net positive 
values of a clearing member's E&A activity that would be unavailable to 
OCC if NSCC were to liquidate the clearing member's positions at NSCC 
arising from its E&A activity.
    The Third Restated Agreement provides for a two-way guarantee 
between OCC and NSCC. Thus, if NSCC suspends a common member \7\ and

[[Page 30651]]

incurs a loss, OCC would owe NSCC an amount determined in accordance 
with the formula described below, and if OCC suspends a common member 
and incurs a loss, NSCC would owe OCC an amount determined in 
accordance with the formula described below. The guarantee from NSCC to 
OCC entitles OCC to reimbursement from NSCC if OCC were to incur a loss 
in liquidating the positions of a suspended clearing member to whom OCC 
had been giving margin credit for its E&A activity which had been 
reported to NSCC for settlement. This entitlement permits OCC to give 
margin credit for long option positions in firm accounts and market-
maker's and specialist's accounts that have been reported to NSCC for 
settlement and therefore allows OCC to calculate margin for equity 
options in one product group.
---------------------------------------------------------------------------

    \7\ In the Third Restated Agreement, the term common member 
refers to an OCC clearing member that also is an NSCC member and 
that has designated NSCC as its designated clearing corporation for 
purposes of effecting settlement of its E&A activity. Under the 
Third Restated Agreement, like the Second Restated Agreement, three 
alternatives are available to a clearing member that does not want 
to become a member of NSCC or SCCP but wants to settle its E&A 
activity through another entity which is a member of NSCC or SCCP. A 
clearing member may appoint (1) another OCC clearing member (an 
``appointed clearing member''), (2) a member of NSCC (a ``nominated 
correspondent''), or (3) if the OCC clearing member is a Canadian 
clearing member, the Canadian Depository for Securities. These three 
alternative settlement arrangements are described in detail in 
Amendment No. 2 to File No. SR-OCC-92-5. This notice of filing 
describes the provisions of the Third Restated Agreement with 
respect to an OCC clearing member that is a common member, but the 
provisions of the Third Restated Agreement are designed to apply to 
each of the alternative settlement arrangements.
---------------------------------------------------------------------------

    The guarantee of each clearing corporation to the other in the 
Third Restated Agreement is unconditional in that each clearing 
corporation's guarantee is not dependent on the ability of the clearing 
corporation to use assets of its suspended member to make a guarantee 
payment. Therefore, OCC and NSCC believe that the trustee for a 
bankrupt OCC clearing member or for a bankrupt NSCC member should not 
be able to successfully attack OCC's or NSCC's right to receive 
guarantee payments from each other or to make guarantee payments to 
each other in accordance with the provisions of the Third Restated 
Agreement. OCC or NSCC would seek recovery of the amount of any 
guarantee payment which either made to the other from the assets of the 
suspended clearing member whose failure necessitated the payment. OCC 
and NSCC believe that its authority to do so would be within the 
special provisions of the Bankruptcy Code that protect the close-out 
activities of securities clearing agencies.\8\
---------------------------------------------------------------------------

    \8\ 11 U.S.C. Secs. 555 and 559.
---------------------------------------------------------------------------

Guarantee Formulas
    The Second Restated Agreement between NSCC and OCC provided that 
OCC would compensate NSCC for losses incurred by NSCC in closing out 
the E&A activity of a defaulting participating member \9\ reported by 
OCC to NSCC. The amount that OCC guaranteed to NSCC would be the 
smallest of three quantities referred to in the Second Restated 
Agreement as the net options loss, the net overall loss, and the 
maximum guarantee.\10\ The Third Restated Agreement between OCC and 
NSCC sets forth a revised formula for the calculation of the amount 
which OCC would owe NSCC if NSCC were to suspend a common member. It 
also provides an analogous formula for the calculation of the amount 
which NSCC would owe OCC if OCC were to suspend a common member.
---------------------------------------------------------------------------

    \9\ As defined in the Second Restated Agreement, the term 
participating member generally refers to an entity that is an OCC 
clearing member and also is a participant in a correspondent 
clearing corporation (``CCC'') (i.e., NSCC, MCC, or SCCP) or an 
entity that is a party to any of the three alternative arrangements 
for effecting settlement through a CCC as provided under the Second 
Restated Agreement.
    \10\ The net options loss was essentially the actual net loss 
incurred by NSCC in closing out the E&A activity with respect to 
which NSCC was unconditionally obligated at the time of the default. 
The net overall loss was essentially the actual net loss incurred by 
NSCC in closing out all transactions of the defaulting participating 
member with respect to which NSCC was unconditionally obligated at 
the time of the default. The maximum guarantee amount was 
essentially the sum of the mark-to-market amounts, positive and 
negative, for all E&A activity with respect to which NSCC was 
unconditionally obligated at the time of the default. The term mark-
to-market amount was defined in the Second Restated Agreement to 
mean the difference between the exercise price of an option and the 
closing price of the underlying stock on the trading day immediately 
preceding the then most recently completed regular morning 
settlement with OCC of the participating member. As set forth in 
footnote 13 below, the term is defined somewhat differently in the 
Third Restated Agreement.
---------------------------------------------------------------------------

    Pursuant to the Third Restated Agreement, the formula for payment 
by OCC under its guarantee to NSCC provides that if NSCC were to 
suspend a common member, OCC would owe NSCC the lesser of the common 
member's (i) net member debit to NSCC or (ii) calculated margin 
requirement. The formula for payment by NSCC under its guarantee to OCC 
provides that if OCC were to suspend a common member, NSCC would owe 
OCC the lesser of the common member's (i) net member debit to OCC or 
(ii) calculated margin Credit.\11\ The term net member debit to NSCC is 
defined to mean the actual net overall debit or loss, if any, realized 
by NSCC from its close-out of the common member (i.e., the debit or 
loss after application of all assets available to NSCC including the 
common member's contribution to NSCC's clearing fund).\12\ The term net 
member debit to OCC is defined to mean the actual net overall debit or 
loss, if any, realized by OCC from its close-out of the common member 
(i.e., the debit or loss after application of all assets available to 
OCC including the common member's margin deposits and contribution to 
OCC's clearing fund). The term calculated margin credit is defined to 
mean the algebraic sum of the mark-to-market amounts \13\ calculated by 
OCC's margin system relating to settlements arising from E&A activity 
with respect to which NSCC has become unconditionally obligated to 
settle and the mark-to-market amounts calculated by NSCC's system for 
offsetting activity in NSCC's system in the same underlying stocks if 
the algebraic sum is positive (i.e., if the sum represents a net 
positive value of the settlements). The term calculated margin 
requirement is defined to mean the same algebraic sum if the algebraic 
sum is negative (i.e., if the sum represents a net negative value of 
the settlements).\14\
---------------------------------------------------------------------------

    \11\ Generally, if either NSCC or OCC suspended a common member, 
the other would also suspend the common member. OCC's Rule 1102(a) 
entitles OCC to suspend a clearing member which had been suspended 
by its designated clearing corporation (Securities Exchange Act 
Release No. 33543 (January 28, 1994) 59 FR 5639 [File No. SR-OCC-92-
05]). However, the two formulas under the Third Restated Agreement 
would require at most a payment by one of the two clearing 
corporations to the other and not to a payment by each clearing 
corporation to the other. This is true because the suspended common 
member's E&A activity in settlement at NSCC would generate either a 
calculated margin requirement or a calculated margin credit but not 
both. Thus, the application of at least one of the two formulas 
would result in a guaranteed amount equal to zero.
    \12\ The net member Debit to NSCC concept is similar to the net 
overall loss concept under the Second Restated Agreement. However, 
the concepts differ in that the net overall loss was the net loss 
resulting from the close-out of all of a suspended member's 
settlement activity at NSCC whereas the net member debit to NSCC is 
the net debit remaining after application of all of a suspended 
member's assets that are available to NSCC. The difference in these 
concepts reflects a judgment on the part of the two clearing 
corporations that the guarantee of each of the other should not 
obligate either to make any payment to the other if the other in 
fact has sufficient assets of the suspended member to make itself 
whole without recourse to the clearing fund deposits of its other 
members.
    \13\ Under the Third Restated Agreement, the term mark-to-market 
amount is defined to mean: (i) with respect to any option exercise 
or assignment position, the difference between the value of the 
position calculated using its exercise price and its closing price 
on the preceding trading day and (ii) with respect to any other 
position at NSCC, the difference between the value of the position 
calculated using its trade price and its closing price on the 
preceding trading day.
    \14\ The calculated margin requirement concept is similar to the 
maximum guarantee amount concept under the Second Restated 
Agreement. The concepts differ in that the maximum guarantee amount 
did not take into account offsetting activity in NSCC's system in 
the same underlying stocks. OCC and NSCC have concluded that the 
calculated margin requirement and calculated margin credit concepts 
render the net options loss concept under the Second Restated 
Agreement superfluous. Thus, there is no counterpart in the 
guarantee formula in the Third Restated Agreement to the net options 
loss concept in the Second Restated Agreement.
---------------------------------------------------------------------------

    The calculation of the calculated margin requirement or calculated 
margin credit will take into account the value of offsetting deliver 
and receive obligations at NSCC including fails but including free 
deliver and receive obligations in the underlying stocks in which each 
common member has E&A activity. NSCC will give OCC a report of

[[Page 30652]]

offsetting deliver and receive obligations in its system on a daily 
basis prior to 8:00 P.M. Central Time.
    The calculation of the calculated margin requirement or calculated 
margin credit is perhaps best illustrated with an example. Suppose that 
ABC is a common member of NSCC and OCC, that ABC is assigned the 
exercise of 100 XYZ June 85 call options, that the closing price of XYZ 
on the day after the exercise (``E+1'') is 90, and that ABC has no 
other E&A activity at all. If ABC also has no non-E&A settlements in 
XYZ in settlement at NSCC, the calculated margin requirement for ABC 
would be $50,000 (90 minus 85 equals $5.00 per share for each of 10,000 
shares). If ABC's non-E&A activity at NSCC in XYZ netted to a right to 
receive 5000 shares at a weighted average price of 87, and if NSCC gave 
OCC notice to that effect prior to 8:00 P.M. on E+1, then the $15,000 
in-the-money value of those shares would be taken into account as an 
offsetting obligation, and the calculated margin requirement for ABC 
would be $35,000 commencing at the time on E+2 when OCC is scheduled to 
make regular daily money settlement with ABC.\15\ If ABC's non-E&A 
activity at NSCC in XYZ instead netted to a right to receive 15,000 
shares at a weighted average price of 87 and if NSCC gave OCC notice to 
that effect prior to 8:00 P.M. on E+1, the value of only 10,000 of 
those shares (i.e., the amount on the opposite side of the market from 
the obligation to deliver created by the assigned call) would be taken 
into account in calculating the calculated margin requirement. Those 
10,000 shares would have an in-the-money value of $30,000, and the 
calculated margin requirement for ABC would be $20,000 commencing at 
the time on E+2 when OCC is scheduled to make regular daily money 
settlement with ABC.
---------------------------------------------------------------------------

    \15\ OCC currently collects from clearing members who owe OCC a 
net dollar amount in regular daily settlement at 9:00 A.M. and pays 
clearing members who are entitled to receive a net dollar amount in 
regular daily settlement at 10:00 A.M. In the example in the text, 
OCC would be obligated to take the in-the-money value of ABC's non-
E&A activity into account in calculating ABC's calculated margin 
requirement if NSCC suspended ABC after 10:00 A.M. (at the latest) 
even if ABC in fact failed to make money settlement with OCC on E+2. 
OCC staff has concluded after discussing with NSCC staff the 
question of when offsetting non-E&A activity should be taken into 
account that the time of regular daily money settlement is an 
appropriate time to incorporate the information in the preceding 
evening's report from NSCC into calculations of the calculated 
margin requirement or calculated margin credit.
---------------------------------------------------------------------------

    OCC reports E&A activity to NSCC each night. Offsetting positions 
information reported back to OCC by NSCC on the evening of E+1 would be 
taken into account in the calculation of the calculated margin 
requirement or calculated margin credit and would be reflected in OCC's 
regular morning settlement on the morning of E+2. Information reported 
back to OCC by NSCC on the evening of E+2 would be taken into account 
in any calculation of the calculated margin requirement or calculated 
margin credit and would be reflected in OCC's regular morning 
settlement on the morning of E+3.
    Although NSCC will provide OCC with reports of offsetting deliver 
and receive obligations in its system on a daily basis and although OCC 
will monitor these reports for unusual position concentrations, OCC 
will not actually use the information in the reports in its margin 
calculations for its members.\16\
---------------------------------------------------------------------------

    \16\ Unlike NSCC, OCC employs three types of accounts for its 
members: customer accounts, market-maker accounts, and firm 
accounts. Separate margin calculations are made with respect to each 
type of member account. Therefore, in order to use the information 
in NSCC's reports in OCC's margin calculations, OCC would have to 
disaggregate the information received from NSCC on an account-by-
account basis. This disaggregation, even if possible, could not be 
done without major changes in both OCC's and NSCC's systems.
---------------------------------------------------------------------------

    OCC's guarantee in the Third Restated Agreement is similar to its 
guarantee in the Second Restated Agreement in that the guarantee does 
not cover the exposure of NSCC to loss from exercise settlements that 
would result if a participating member \17\ transfers settlements from 
its account at NSCC to the account of any other member of NSCC (even 
another participating member or another member that is an affiliate of 
the participating member) and that second member defaults on its 
obligations to NSCC with respect to those settlements.
---------------------------------------------------------------------------

    \17\ Under the Third Restated Agreement the term participating 
member specifically refers to (1) a common member, (2) an NSCC 
clearing member that (i) has been appointed as an appointed clearing 
member by an OCC clearing member that is an appointing clearing 
member and (ii) has designated NSCC as its designated clearing 
corporation for the settlement of its E&A activity. (3) an OCC 
clearing member that (i) is a nominating clearing member, (ii) has 
appointed a nominated correspondent that is an NSCC member, and 
(iii) has designated NSCC as its designated clearing corporation for 
the settlement of its E&A activity, and (4) an OCC clearing member 
that is a Canadian clearing member. The terms appointing clearing 
member, appointed clearing member, nominating clearing member, and 
nominated correspondent are defined in Article I of OCC's By-Laws.
---------------------------------------------------------------------------

Delivery of Stock Held in Escrow
    The Second Restated Agreement between NSCC and OCC contemplated 
that OCC would, if necessary, deliver to NSCC stock held in lieu of 
margin to cover a suspended clearing member's short call positions 
against payment by NSCC of the exercise price for the positions and 
that the value of any such covered short position would not be taken 
into account in determining the amount guaranteed by OCC to NSCC. In 
contrast, the Third Restated Agreement does not contemplate that OCC 
will deliver stock held to cover short call positions because, as 
described above, the Third Restated Agreement provides for taking the 
value of offsetting deliver and receive obligations at NSCC into 
account in the calculation of the calculated margin requirement or 
calculated margin credit.
Amendments to OCC Rule 601
    Because of the guarantee extended by NSCC to OCC, OCC proposes to 
amend Rule 601 to enable OCC to give margin credit for long option 
positions in firm, market-makers', and specialists' accounts that have 
been reported to NSCC for settlement. As a result, OCC will be able to 
calculate margin for equity options in one product group. The 
amendments to Rule 601 essentially reverse changes which were proposed 
in File No. SR-OCC-92-5.\18\
---------------------------------------------------------------------------

    \18\ Supra note 6.
---------------------------------------------------------------------------

Amendment to OCC Rule 1107
    OCC proposes to amend Rule 1107 to provide that OCC will liquidate 
securities deposited to cover assigned short call positions and use the 
proceeds to reimburse itself for the incremental amount, if any, which 
OCC is obligated to pay to the designated clearing corporation by 
reason of the covered short positions as well as for the exercise price 
of the covered options and for any costs associated with the 
liquidation.
Amendment to NSCC's Clearing Fund Formula
    NSCC proposes to amend its clearing fund formula in order to 
exclude from the calculation trades for which NSCC has protection under 
the terms of the Third Restated Agreement.\19\
---------------------------------------------------------------------------

    \19\ The complete text of the amendments to NSCC's clearing fund 
formula is set forth in Exhibit A to NSCC's filing. A copy of the 
filing and all exhibits is available for copying and inspection in 
the Commission's Public Reference Room or through NSCC.
---------------------------------------------------------------------------

    OCC and NSCC believe the proposed rule changes are consistent with 
the purposes and requirements of Section 17A of the Act because the 
proposals (i) will enhance the system used by OCC to effect settlement 
of exercises and assignments of equity options by providing for a two-
way guarantee between OCC and NSCC thereby permitting OCC to return to 
a one product group margin system and (ii)

[[Page 30653]]

will enhance NSCC's ability to protect itself and its members against 
loss.

(B) Self-Regulatory Organizations' Statement on Burden on Competition

    OCC and NSCC do not believe the proposed rule changes will impose 
any material burden on competition.

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

    Written comments were not and are not intended to be solicited by 
OCC or NSCC with respect to the proposed rule changes, and none have 
been received by OCC or NSCC.

III. Date of Effectiveness of the Proposed Rule Changes and Timing for 
Commission Action

    Within thirty-five 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 ninety 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 OCC and NSCC consent, the Commission will:
    (A) By order approve the proposed rule changes or
    (B) Institute proceedings to determine whether the proposed rule 
changes should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule changes that are filed 
with the Commission, and all written communications relating to the 
proposed rule changes between the Commission and any person, other than 
those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. Sec. 552, will be available for inspection and 
copying in the Commission's Public Reference Room, 450 Fifth Street, 
N.W., Washington, D.C. 20549. Copies of such filing will also be 
available for inspection and copying at the principal office of OCC and 
NSCC. All submission should refer to the File Nos. SR-OCC-96-04 and SR-
NSCC-96-11 and should be submitted by July 8, 1996.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\20\
---------------------------------------------------------------------------

    \20\ 17 CFR 200.30-3(a)(12) (1995).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-15274 Filed 6-14-96; 8:45 am]
BILLING CODE 8010-01-M