[Federal Register Volume 62, Number 51 (Monday, March 17, 1997)]
[Notices]
[Pages 12671-12675]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6560]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38376; File No. SR-NYSE-97-05]


Self-Regulatory Organizations; New York Stock Exchange, Inc., 
Notice of Filing of Proposed Rule Change Relating to the Agreement 
Transferring the New York Stock Exchange Options Business to the 
Chicago Board Options Exchange

March 7, 1997.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 12672]]

(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on March 3, 1997, the New York Stock Exchange, Inc. (``NYSE'' 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 NYSE. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1) (1988).
    \2\ 17 CFR 240.19b-4 (1994).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The NYSE has determined to cease maintaining a trading facility for 
transactions in options issued by The Options Clearing Corporation 
(``OCC'') and proposes to facilitate transfer of its options business 
to the Chicago Board Options Exchange, Incorporated (``CBOE'').\3\
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    \3\ On March 3, 1997, the CBOE filed with the Commission a 
proposed rule change, SR-CBOE-97-14, regarding the transfer of the 
NYSE options business.
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    As more fully described below, under the agreement between the 
Exchange and CBOE that sets forth the terms and conditions pursuant to 
which the transfer will take place (''Transfer Agreement''),\4\ CBOE 
will issue trading permits to NYSE options firms in accordance with the 
number of NYSE floor badges held by the firms' partners, employees and 
affiliates. Subject to certain limitations described in the Transfer 
Agreement, the Exchange proposes to have discretion to condition the 
issuance of permits upon the payment of any amounts owed to the 
Exchange by the options firms or their badge holders or other 
affiliates, as the case may be, which may include holders of the 
corresponding NYSE Options Trading Rights (``OTRs'').
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    \4\ CBOE's parallel filing includes the Transfer Agreement as 
Exhibit B to the filing. The Exchange's proposed rule change and 
this notice incorporate Exhibit B to SR-CBOE-97-14.
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    In addition, the Transfer Agreement gives the Exchange control over 
possible payments to certain holders of OTRs or their transferees 
arising from a lease pool of permits called for by the Transfer 
Agreement, as more fully described elsewhere in this notice. The 
Exchange proposes to have discretion to withhold permission for such 
payments until (1) any amounts owed to the Exchange by the OTR holder 
or its affiliates are paid (which may be effected by directing CBOE to 
make the payments directly to the Exchange until the indebtedness is 
satisfied) and (2) in the case where the OTR has been separated, the 
holder transfers his OTR to the Exchange.

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 NYSE included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The NYSE 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

(a) Purpose
    The purpose of the proposed rule change is to effect the fair and 
orderly transfer of the Exchange's options business to CBOE and to 
secure for traders and brokers who currently make their living on the 
Exchange's options floor an opportunity to continue their occupations 
at CBOE.
    The basic parameters of the transfer and their purposes, as well as 
the environmental factors that led to the transfer and molded the 
negotiations between the Exchange and CBOE, are described below.
(i) Overview
    CBOE will acquire the options business conducted through the 
Exchange's options facilities pursuant to the Transfer Agreement. The 
effective date of the acquisition is scheduled for April 28, 1997, 
subject to fulfillment of conditions specified in the Transfer 
Agreement and approval of this proposed rule change and the parallel 
filing by CBOE.
(ii) Background
    In April 1996, the Exchange undertook a strategic review of the 13-
year operation of its options business. In the course of the review, 
the Exchange considered the potential for overall growth in the options 
industry; explored the needs of the order-providing firms and the 
relationships through which the options business is done; assessed the 
existing capacity and structure in the options industry and the 
Exchange's existing and potential competitive position; and examined 
the scale of the effort necessary to make the Exchange's options 
business line profitable. The Exchange concluded that remaining in the 
options business, even at the then-current market share, would require 
significant capital expenditures, and that any effort to significantly 
improve market share would require an enormous expenditure of capital 
and human resources.
    On May 2, 1996, upon presentation of the strategic review to the 
Exchange's Board of Directors, it was determined that further 
investigation would be made into the possibility of exiting the options 
business and directing the resources previously expended on that 
business to the Exchange's core equity business.
    Publicity via Reuters and other news media followed this 
determination, resulting in numerous inquiries from options exchanges, 
commodities exchanges, member firms and others as to the possible 
acquisition of the Exchange's options business. Several of these 
inquiries mentioned the possibility of granting special trading 
privileges, relocation payments and other benefits to the Exchange's 
options members in connection with their collective relocation to the 
acquirer, as well as the possibility of paying licensing fees and other 
amounts to the Exchange.
    In light of these inquiries and other factors, on June 24, 1996, 
the Exchange notified its members and member organizations that it 
would transmit to the various exchanges and others that had expressed 
interest in acquiring its options business the proposed terms for the 
sale of the business, as well as certain operational and other 
statistical data. This information was sent on or about June 27, 1996, 
except as to one recipient to whom it was sent on July 19, 1996.
    These transmissions resulted in a series of telephone and face-to-
face discussions with a variety of potential purchasers. The American 
Stock Exchange (``AMEX''), CBOE and the Philadelphia Stock Exchange 
(``PHLX'') provided detailed, written preliminary bids and executed 
confidentiality agreements with the Exchange.\5\
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    \5\ NYSE also met on several occasions with the New York Cotton 
Exchange (``Cotton Exchange''), but the Cotton Exchange did not make 
a written submission to NYSE and did not comply with any deadlines 
under NYSE's tender process during August and September 1996. 
Moreover, the cotton Exchange faced barriers to entry not applicable 
to the other exchanges, including absence of registration as a 
national securities exchange with the Commission and lack of 
requisite systems and regulatory capacity. By letter to NYSE dated 
December 16, 1996, (attached as a part of Exhibit A to this filing), 
the Cotton Exchange indicated that it had no interest in acquiring 
NYSE's options business.
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    During these discussions, it became clear that because there are as 
many

[[Page 12673]]

OTRs as there are Exchange members (a total of 1366), but only 92 OTRs 
were directly involved in the options business, there was an excess of 
1,274 OTRs, thus complicating negotiations to obtain cost-free trading 
permits. Accordingly, by resolution on September 5, 1996, the 
Exchange's Board limited the universe of OTR holders potentially 
entitled to direct benefits from the transfer to present and future 
holders of the 92 ``activated'' OTRs, that is, to: (1) Regular members 
who already were using or leasing out their OTRs, (2) holders of OTRs 
separated from equity memberships, and (3) subsequent purchasers from 
them.
    Based upon review of these preliminary bids and other factors, the 
Exchange sent to those three preliminary bidders a letter dated 
September 10, 1996, requesting firm, written bids (the acceptance of 
which by NYSE would create a letter of intent between the parties), 
providing parameters for the bids, and asking that the bids be 
submitted within a week. The Exchange received written bids from CBOE 
and AMEX, each dated September 17, 1996, and from PHLX, dated September 
16, 1996.
    Based upon its comparison of these bids, telephone conferences and 
discussions with representatives of the bidders, the Exchange staff 
recommended the CBOE bid to the Exchange's Board of Directors. The 
recommendation was based on several factors, including that CBOE's bid 
was competitive with the other bids financially and generally superior 
in terms of the opportunity it promised for NYSE options traders and 
brokers to continue to make their livings in the options business. In 
particular, the CBOE bid, which was competitive from the standpoint of 
trading rights, offered a separate, state-of-the-art facility for the 
transferred business. The likelihood that CBOE would remain viable for 
the long term was also a key factor.
    On October 3, 1996, the Board indicated its preference for 
negotiations with CBOE based upon CBOE's bid. By letter to CBOE dated 
October 3, 1996, NYSE accepted CBOE's bid, thereby creating a letter of 
intent between NYSE and CBOE.
    On November 7, 1996, following further clarification of CBOE's bid 
and extensive discussions between CBOE and NYSE, the Board authorized 
execution and delivery of the requisite agreements and other 
appropriate actions with CBOE to consummate the proposed transaction.
    On December 5, 1996, the Exchange and CBOE executed a revised 
letter of intent for the purpose of further clarifying certain points. 
On December 9, 1996, the Exchange distributed on its options floor a 
memorandum explaining the proposed transaction and, shortly thereafter, 
mailed copies thereof to the 92 OTR holders discussed above. The 
Exchange and CBOE executed the Transfer Agreement as of February 5, 
1997.
(iii) Trading Permits and How They Benefit Exchange Options Firms and 
Options Trading Rights
    This section highlights the key elements of the rights, privileges 
and benefits available to transferring NYSE options members pursuant to 
the rules CBOE proposes to adopt in accordance with the Transfer 
Agreement.
(aa) Creation and Issuance of CBOE Trading Permits
    CBOE will create and issue 75 trading permits, each having a seven-
year duration. Subject to limited exceptions, the permits may not be 
sold, leased or transferred for a period of one year after the 
effective date under the Transfer Agreement. The permits will provide 
for trading on a new and separate trading floor at CBOE's Chicago 
facility. Representatives of the Exchange's options community will have 
the opportunity to participate in the design of the new trading floor, 
which will have services and support facilities comparable to those 
used on CBOE's principal options trading floor. Upon qualification 
pursuant to CBOE rules, permit recipients will have (1) the right to 
act as broker or dealer in transferred options (i.e., options traded on 
NYSE and not dually listed on CBOE), as well as in options subsequently 
allocated to the program by CBOE; (2) the right to trade ``by order'' 
as principal on CBOE's principal trading facility those options dually 
listed on NYSE and CBOE; and (3) the right to trade ``by order'' as 
principal on CBOE's principal trading facility any other classes of 
CBOE options up to an aggregate of 20 percent of the holder's quarterly 
contract volume on CBOE.
    In addition, each NYSE options specialist unit will be appointed as 
the CBOE Designated Primary Market-Maker (``DPM'') in its transferred 
specialty options. CBOE will allocate to the new program securities 
underlying at least 14 options classes per year for the first seven 
years after the transfer.
    Permit holders will be subject generally to the same obligations 
under the CBOE rules as are regular CBOE members, except that 
application fees will be waived in certain instances. Under certain 
circumstances, recipients of permits or their nominees who move their 
principal residence to Chicago and qualify under CBOE rules may receive 
up to $10,000 per permit for customary moving expenses.
(bb) Recipients of Permits; Manner of Issuing Permits; Lease Pool
    The 75 Permits are to be issued as follows:
    (1) Non-Specialist Firms (``Homesteader Rule''). Each Exchange non-
specialist options firm, including sole proprietors, doing business on 
the NYSE options floor will be offered the same number of permits as 
that firm had in valid NYSE floor badges as of December 5, 1996. 
However, in order for the firm to actually receive permits, the firm's 
individual badge holders on that date must personally qualify and trade 
on CBOE as individual permit holders or as ``nominees'' of the firms 
owning permits. Consistent with CBOE rules permitting partnerships and 
corporations to be members, the firms themselves may own permits. CBOE 
may impose limits on transfers of permits and prohibit substitution of 
nominees in a manner designed to assure that permits are not 
transferred, and that nominees remain with the firm at CBOE, for one 
year after issuance.
    (2) Specialist Firms. As in the case of non-specialist firms, each 
Exchange specialist options firm, including joint books, will be 
offered the same number of permits as that firm had in valid NYSE floor 
badges as of December 5, 1996. However in contrast to non-specialist 
firms, no specified individual will be required to be a specialist 
firm's nominee or to move to or remain at CBOE as a condition of a 
permit's effectiveness. Instead, the specialist firms can select the 
persons to become nominees and use the permits. Nominees may be freely 
substituted, but CBOE may impose limits on transfers of permits 
designed to assure that permits are not transferred for one year after 
issuance.
    (3) Creation of Lease Pool and Distribution of Proceeds. CBOE will 
lease out any of the 75 permits not issued as specified above, as well 
as any permits revoked due to violation of CBOE restrictions on 
transfer and substitution of nominees, through an auction or other 
competitive process. The proceeds from the leases will be distributed 
pro rata to the approximately 92 persons who, as a result of their 
OTRs, were entitled to possible benefits, as discussed above.

[[Page 12674]]

(cc) Transfer Agreement Provisions As Pragmatic Compromises
    The elements of the transfer outlined above represent a series of 
pragmatic compromises negotiated to reconcile the respective goals of 
the Exchange and CBOE. As noted above, the Exchange sought to minimize 
the disruption in the lives of the option badge holders and to maximize 
the opportunity for its options traders and brokers to continue to make 
their livings in the options business after the transfer.
    In contrast, CBOE sought to maximize the success of the transferred 
market as a whole by seeking to assure (1) That the NYSE options 
specialists participated in the transfer, (2) that NYSE option traders 
and brokers with trading experience moved to Chicago, and (3) that the 
number of permits issued optimized the viability of the transferred 
market as a whole and of the businesses of the permit holders 
individually. Thus, for example, the Transfer Agreement's 
``homesteader'' element was designed to support CBOE's general goal of 
attracting experienced traders. However, the omission of a homesteading 
requirement for specialists reflects the higher priority attached by 
CBOE to assuring that all of the options specialists participated in 
the transfer.
(iv) Purchase Price and Economic Rationale
    The purchase price under the Transfer Agreement is $5,000,000. 
Following is a discussion of the economic basis supporting this 
purchase price and the transaction, generally.
    By acquiring the Exchange's options business, CBOE will obtain a 
trained pool of talent with experience in the trading characteristics 
of the transferring option classes and customer relationships. Assuming 
that these attributes and CBOE's own assets enable it at least to 
retain the Exchange's market share. CBOE will acquire a substantial 
revenue stream offset by only marginal increases in operating costs. 
CBOE also will face a one-time investment in facilities.
    Typically in the sale of a going business, the seller receives a 
multiple of annual revenues, especially if lower fixed or marginal 
costs, or other factors, allow the purchaser a better opportunity than 
the seller to realize benefits from existing or anticipated revenues. 
The Exchange believes that the Transfer Agreement does no more than 
recognize an appropriate sharing of these revenues.
(v) Use of Proceeds
    The Exchange will retain $1.2 million of the purchase price to 
partially offset Exchange exit costs and as compensation for a ten-year 
license given to CBOE to list and trade options on the NYSE Composite 
Index. The Exchange will distribute the remaining $3.8 million of the 
purchase price, net of an appropriate tax reserve, on a pro rata basis 
to all of its 1366 members, subject to a determination of whether or 
not the distribution will be taxed both to the Exchange and to the 
member recipients. The tax reserve recognizes that the distribution of 
the lease pool proceeds discussed elsewhere in this notice may also 
result in imputed income to the Exchange. The Exchange will apply to 
the Internal Revenue Service for Private Letter Rulings to resolve the 
two tax question. Pending receipt of the rulings, CBOE will pay the 
$3.8 million into an Escrow Account.
    If the Exchange receives an adverse ruling on the lease proceeds, a 
portion of the escrow account will be released annually as needed to 
fund tax payments, with any surplus reverting to the Exchange's 
treasury after the lease pool terminates in the year 2004. If the 
Exchange receives an adverse ruling on the distribution to the 1366 
members, distribution (net of any tax reserve for the lease pool 
proceeds) of some or all of the escrow account may be made to the NYSE 
Foundation \6\ instead of the 1366 members. Under no circumstances will 
escrow funds, except for amounts owed to the Exchange and any tax 
reserves or reserve surplus, be distributed other than to the 1366 
members or the NYSE Foundation.
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    \6\ The NYSE Foundation, authorized by the Board of Directors of 
the Exchange in October 1983 and incorporated as a not-for-profit 
organization in November 1983, provides funds for educational, civic 
and charitable purposes. The Foundation's charitable giving focuses 
on three main areas: education, quality of life, and community. The 
escrow funds would be available for any such purposes other than 
those specifically targeted at the securities industry.
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(vi) Conditions to Receipt of Permits and Lease-Pool Payments
    The discretionary conditions requiring payment of outstanding 
amounts owing to the Exchange implement similar existing requirements 
under the Exchange's Constitution and rules. (See, e.g., NYSE 
Constitution, Article II, Section 8; NYSE Rule 795(d)(i); and NYSE Rule 
795.10, Supplementary Material.) The discretionary condition requiring 
transfer of separated OTRs to the Exchange is a housekeeping matter 
designed to assure that all OTRs, which will have only speculative 
value at the conclusion of the transfer, are held either by regular 
members or the Exchange itself.
(b) Basis
    The Exchange believes the basis under the Act for this proposed 
rule change is the requirement under Section 6(b)(5) that an exchange 
have rules that are designed to prevent fraudulent and manipulative 
acts and practices, to promote just and equitable principles of trade, 
to remove impediments to and perfect the mechanism of a full and open 
market and a national market system, and, in general, to protect 
investors and the public interest.

B. Self-Regulatory Organization's Statement on Burden on Competition

    This proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the 1934 Act.
    The Exchange notes that in CBOE's parallel filing, Item 4 of SR-
CBOE-97-14, CBOE outlines the way in which the transfer enhances the 
competitive environment and imposes no restrictions on trading by NYSE 
or other markets of the stock options now traded on NYSE, other than 
options on the NYSE Composite Index subject to the license agreement 
with CBOE. The Exchange's proposed rule change and this notice 
incorporate Item 4 of CBOE's filing.

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

    The Exchange has received the following written comments from 
members or other interested parties:
    Letter to Richard Grasso, Chairman and Chief Executive Officer of 
the Exchange, from Stephen G. O'Grady Frank Barbato and Greg 
Tenbekjian, Exchange options traders, dated November 22, 1996, 
objecting to the proposed transaction with CBOE on the grounds that 
various classes of options participants were not treated equally. The 
Exchange has not made and could not make any representation to members 
concerning exact equality of treatment. As more fully explained 
elsewhere in this notice, the bid process initiated by the Exchange 
brought to bear the dictates of the market which, generally, placed a 
higher premium on specialist participation in any transfer than on 
participation by brokers. The Exchange, which was under no obligation 
to obtain any benefits for any options participants, felt it was 
unreasonable to

[[Page 12675]]

reject potential benefits to almost all options participants, including 
brokers whose badge holders were willing to transfer to CBOE, because 
the marketplace placed a higher premium on participation by one group 
than another.
    Letter to Lewis J. Horowitz, Executive Vice President of the 
Exchange, from Joseph J. O'Neill, President of the New York Cotton 
Exchange, dated December 16, 1996, to the effect that the Cotton 
Exchange had no interest in acquiring the Exchange's options 
operations.
    Letter to Rudolph Giuliani, Mayor of the City of New York, from 
Mark Green, Public Advocate of the City of New York, dated January 8, 
1997, regarding possible loss of jobs in New York City as a result of 
the transfer to CBOE.
    Letter to the Exchange from Isaac M. Ovadiah, an OTR lessor, dated 
January 9, 1997, reflecting the writer's intent to arbitrate against 
the Exchange's future plans concerning trading rights and to apply to 
the federal courts seeking injunctive relief. The Exchange knows of no 
basis pursuant to which arbitration would be available to Mr. Ovadiah 
and no basis for the granting of an injunction or similar relief with 
respect to any of the proposed transactions with CBOE. The Exchange has 
received no further written communication from Mr. Ovadiah concerning 
the matters referred to above.
    Letter to William Johnston, President and Chief Operating Officer 
of the Exchange, from Cohen, Duffy, McGowan & Co., LLC, dated January 
16, 1997, to the effect that the Exchange's process for the proposed 
transfer to CBOE was fair and that the economic benefit to members 
choosing to go to CBOE will surpass anything they could have achieved 
elsewhere.
    Memorandum to William Johnston, President and Chief Operating 
Officer of the Exchange, from Mark Duffy, an Exchange options trader, 
dated January 20, 1997, to the effect that the proposed CBOE 
transaction is fair and provides beneficial opportunities.
    Letter to William Johnston, President and Chief Operating Officer 
of the Exchange, from Lawrence Helfant, Inc., dated February 4, 1997, 
indicating that the firm did not support any possible legal action 
against the Exchange by OTR holders with respect to the proposed 
transfer to CBOE and that it endorsed the proposed transfer.
    Letter to William Johnston, President and Chief Operating Officer 
of the Exchange, from BE Partners, dated February 12, 1997, to the 
effect that the CBOE proposal was the best of the proposals from the 
major exchanges for transfer of the options business.
    Undated notice entitled ``An Open Letter To The Members, Directors, 
and Chairman of the New York Stock Exchange'' from certain NYSE options 
participants named therein, as distributed on the Exchange's Options 
floor, reflecting opposition to the proposed transaction. The Exchange 
notes that is could simply have terminated its options business and 
sought no benefits for any options participants.
    However, as is more fully explained elsewhere in this notice, the 
Exchange has obtained substantial benefits for a broad cross-section of 
options participants. The objections voiced in this notice do not take 
into account the foregoing fact or the limitations and trade-offs 
inherent in the negotiation process necessarily undertaken by the 
Exchange in connection with the proposed transaction. The Exchange 
believes that all objections set forth in the notice from the options 
participants have been addressed in the Exchange's notice and rule 
filing and that the proposed transaction will be beneficial to the 
Exchange's overall membership.
    Undated and unsigned notice entitled ``NYSE Options Update'', as 
distributed on the Exchange options floor, alleging various 
shortcomings in the proposed transaction, all of which were responded 
to or explained in the body of the Exchange's notice. An abbreviated 
reiteration of those responses with respect to all substantive issues 
in the notice follows: (i) The assertion that NYSE members who have not 
activated their OTRs will receive no compensation is not correct; 
depending upon rulings from the Internal Revenue Services with respect 
to tax treatment of certain proceeds from the transaction, members may 
receive a pro rata distribution of some or all of such proceeds, or 
will benefit indirectly from contribution of amounts to the NYSE 
Foundation; (ii) as to OTR lessors ``losing their income'' for OTR 
leases, it is anticipated that, subject to certain contingencies, OTR 
lessors will receive, for 7 years, payments from the lease pool to be 
maintained by CBOE which will exceed lease payments now received for 
OTRs; and (iii) as to current ``operatives'' of OTRs receiving 
``severely limited trading rights on CBOE'', in fact, CBOE is creating 
a new and separate trading floor with new and very broad-based trading 
rights available in former NYSE options and other options to 
transferring NYSE participants who meet CBOE rules and requirements.

III. Date of Effectiveness of the Proposed Rule Change 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 the self-regulatory organization consents, 
the Commission will:
    (A) by order approve such proposed rule change or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

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, Security 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 at the 
Commission's Public Reference Section, 450 Fifth Street, NW., 
Washington, DC 20549. Copies of such filing will also be available for 
inspection and copying at the principal office of the NYSE. All 
submissions should refer to File No. SR-NYSE-97-05 and should be 
submitted by April 7, 1997.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-6560 Filed 3-14-97; 8:45 am]
BILLING CODE 8010-01-M