[Federal Register Volume 70, Number 132 (Tuesday, July 12, 2005)]
[Notices]
[Pages 40069-40073]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-13602]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51966; File No. SR-Amex-2005-049]


Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Order Granting Accelerated Approval of a Proposed 
Rule Change and Amendment Nos. 1 and 2 Thereto Relating to an Amendment 
to the Generic Listing Standards for Index-Linked Securities

July 1, 2005.
    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 April 28, 2005, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by the Exchange. On June 17, 
2005, the Amex submitted Amendment No. 1 to the proposed rule 
change.\3\ On June 24, 2005, the Amex submitted Amendment No. 2 to the 
proposed rule change.\4\ The Commission is publishing this notice to 
solicit comments on the proposed rule change, as amended, from 
interested persons and is approving the proposal on an accelerated 
basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1, which replaced and superseded the original 
filing in its entirety, included an enhanced description of each 
underlying index and included additional support for not requiring 
more frequent dissemination of the underlying BuyWrite index value.
    \4\ Amendment No. 2 made technical corrections to the proposed 
rule text to reflect the text of Section 107D of the Amex Company 
Guide in effect on April 28, 2005.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to add Commentary .01 to Section 107D of the 
Amex Company Guide (``Company Guide'') for the purpose of permitting 
the listing and trading, under Section 107D, of index-linked securities 
(``Index Securities'') based on the Chicago Board Options Exchange, 
Inc. (``CBOE'') S&P 500(sm) BuyWrite Index (``BXM'') and the CBOE 
DJIA(sm) BuyWrite Index (``BXD'') (each an ``Index'' and collectively, 
the ``Indexes''). Proposed Commentary .01 establishes a limited 
exemption for the BXM and BXD from the continued listing requirement in 
Section 107D(h) of the Company Guide that an index be calculated and 
widely disseminated at least every 15 seconds. Below is the text of the 
proposed rule change, as amended. Proposed new language is in italics.
* * * * *
Section 107 Other Securities
    The Exchange will consider listing any security not otherwise 
covered by the criteria of Sections 101 through 106, provided the issue 
is otherwise suited for auction market trading. Such issues will be 
evaluated for listing against the following criteria:
    A-C. No Change.
    D. Index-Linked Securities
    Index-linked securities are securities that provide for the payment 
at maturity of a cash amount based on the performance of an underlying 
index or indexes. Such securities may or may not provide for the 
repayment of the original principal investment amount. The Exchange may 
submit a rule filing pursuant to section 19(b)(2) of the Securities 
Exchange Act of 1934 to permit the listing and trading of index-

[[Page 40070]]

linked securities that do not otherwise meet the standards set forth 
below in paragraphs (a) through (k). The Exchange will consider for 
listing and trading pursuant to Rule 19b-4(e) under the Securities 
Exchange Act of 1934, index-linked securities provided:
    (a) through (k) No Change.
    E. No Change.
    Commentary * * *
    .01 Index-linked securities based on CBOE S&P 500 BuyWrite IndexSM 
(BXMSM) or the CBOE DJIA BuyWrite IndexSM (BXDSM) may be listed and 
traded pursuant to Section 107D of the Company Guide even though the 
continued listing requirement found in paragraph (h)(3) providing that 
an index be calculated and widely disseminated every 15 seconds is not 
satisfied. An indicative value of an index-linked security based on the 
BXM and BXD is required to be calculated and disseminated after the 
close of trading to provide an updated value.
* * * * *

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 Amex included statements 
concerning the purpose of, and basis for, the proposed rule change, as 
amended, and discussed any comments it received on the proposed rule 
change, as amended. The text of these statements may be examined at the 
places specified in Item III below. The Amex 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 Commission recently approved new Section 107D to the Company 
Guide adopting generic listing standards to permit the listing and 
trading of Index Securities pursuant to Rule 19b-4(e) under the Act.\5\ 
As a result, the Exchange may now list Index Securities based on an 
index or indexes (the ``Underlying Index'') that meet the criteria set 
forth in paragraph (g) of Section 107D of the Company Guide.
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    \5\ See Securities Exchange Act Release No. 51563 (Apr. 15, 
2005), 70 FR 21257 (Apr. 25, 2005) (File No. SR-Amex-2005-001).
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    Specifically, an Underlying Index is required either to be (i) an 
index meeting the specific criteria set forth in Section 107D(g) that 
is similar to current Amex Rule Commentary .02 to Rule 901C; or (ii) an 
index previously approved for the trading of options or other 
derivative securities by the Commission under section 19(b)(2) of the 
Act \6\ and rules thereunder. The Commission has granted approvals for 
particular products based on both the BXM and BXD.\7\
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    \6\ 15 U.S.C. 78s(b)(2).
    \7\ See Securities Exchange Act Release Nos. 51840 (June 14, 
2005), 70 FR 35468 (June 20, 2005) (File No. SR-Amex-2005-042) 
(approving the listing and trading of JPMorgan Chase Notes linked to 
the BXD Index); 51634 (Apr. 29, 2005), 70 FR 24138 (May 6, 2005) 
(File No. SR-Amex-2005-036) (approving the listing and trading of 
Wachovia Notes linked to the BXM Index); 51426 (Mar. 23, 2005), 70 
FR 16315 (Mar. 30, 2005) (File No. SR-Amex-2005-022) (approving the 
listing and trading of Morgan Stanley Notes linked to the BXM 
Index); and 50719 (Nov. 22, 2004), 69 FR 69644 (Nov. 30, 2004) (File 
No. SR-Amex-2004-55) (approving the listing and trading of Morgan 
Stanley Notes linked to the BXM Index).
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Description of the Indexes
    BXM Index. The BXM Index is a benchmark index designed to measure 
the performance of a hypothetical ``buy-write'' \8\ strategy on the S&P 
500. Developed by the CBOE in cooperation with Standard & Poor's 
Corporation (``S&P''), the Index was initially announced in April 
2002.\9\ The Exchange states that the CBOE developed the BXM Index in 
response to requests by options portfolio managers that the CBOE 
provide an objective benchmark for evaluating the performance of buy-
write strategies, one of the most popular option trading strategies. In 
addition, the BXM Index could also provide investors with a 
straightforward indicator of the risk-reducing character of options.
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    \8\ A ``buy-write'' is a conservative options strategy in which 
an investor buys a stock or portfolio and writes call options on the 
stock or portfolio. This strategy is also known as a ``covered 
call'' strategy. A buy-write strategy provides option premium income 
to cushion decreases in the value of an equity portfolio, but will 
underperform stocks in a rising market. A buy-write strategy tends 
to lessen overall volatility in a portfolio.
    \9\ The BXM Index consists of a long position in the component 
securities of the S&P 500 and options on the S&P 500.
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    The BXM Index is a passive total return index based on (1) buying a 
portfolio consisting of the component stocks of the S&P 500, and (2) 
``writing'' (or selling) near-term S&P 500 call options (SPX), 
generally on the third Friday of each month. This strategy consists of 
a hypothetical portfolio consisting of a ``long'' position indexed to 
the S&P 500 on which are deemed sold a succession of one-month, at-the-
money call options on the S&P 500 (SPX) listed on the CBOE. Dividends 
paid on the component stocks underlying the S&P 500 and the dollar 
value of option premium deemed received from the sold call options are 
functionally ``re-invested'' in the covered S&P 500 portfolio.
    The value of the BXM Index on any given date will equal: (1) The 
value of the BXM Index on the previous day, multiplied by (2) the daily 
rate of return \10\ on the covered S&P 500 portfolio on that date. 
Thus, the daily change in the BXM Index reflects the daily changes in 
value of the covered S&P 500 portfolio, which consists of the S&P 500 
(including dividends) and the component S&P 500 option (SPX). The daily 
closing price of the BXM Index is calculated and disseminated by the 
CBOE on its Web site at http://www.cboe.com and via the Options Pricing 
and Reporting Authority (``OPRA'') at the end of each trading day. The 
value of the S&P 500 Index is disseminated at least once every fifteen 
(15) seconds throughout the trading day. The Exchange believes that the 
dissemination of the S&P 500 along with the ability of investors to 
obtain S&P 500 call option pricing provides sufficient transparency 
regarding the BXM Index.\11\ In addition, as indicated above, the value 
of the BXM Index is calculated once every trading day, thereby 
providing investors with a daily value of such ``hypothetical'' buy-
write options strategy on the S&P 500.
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    \10\ The daily rate of return on the covered S&P 500 portfolio 
is based on (a) the change in the closing value of the stocks in the 
S&P 500 portfolio, (b) the value of ordinary cash dividends on the 
stocks underlying the S&P 500, and (c) the change in the market 
price of the call option. The daily rate of return will also include 
the value of ordinary cash dividends distributed on the stocks 
underlying the S&P 500 that are trading ``ex-dividend'' on that date 
(that is, when transactions in the stock on an organized securities 
exchange or trading system no longer carry the right to receive that 
dividend or distribution) as measured from the close in trading on 
the previous day.
    \11\ Call options on the S&P 500 (SPX) are traded on the CBOE, 
and both last sale and quotation information for the call options 
are disseminated in real-time through OPRA. The Exchange states that 
the value of the BXM can be readily approximated as a function of 
observable market prices throughout the trading day. In particular, 
such a calculation would require information on the current price of 
the S&P 500 Index and specific nearest-to-expiration call and put 
options on that Index. The Exchange represents that these components 
trade in highly liquid markets, and real-time prices are available 
continuously throughout the trading day from a number of sources 
including Bloomberg and the CBOE.
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    BXD Index. Similar to the BXM Index with respect to the S&P 500, 
the BXD Index is a benchmark index designed to measure the performance 
of a hypothetical ``buy-write'' strategy on the DJIA. Developed by the 
CBOE in cooperation with Dow Jones & Company (``Dow Jones''), the BXD 
Index was

[[Page 40071]]

initially announced in March 2005.\12\ The BXD was set to an initial 
value of 100.00 as of October 16, 1997. The Exchange states that, as 
with the BXM Index, the CBOE developed the BXD Index in response to 
requests by options portfolio managers to provide an objective 
benchmark for evaluating the performance of buy-write strategies, as 
well as to provide investors with a straightforward indicator of the 
risk-reducing character of options.
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    \12\ The BXD Index consists of a long position in the component 
securities of the DJIA and options on the DJIA (DJX). See http://www.cboe.com/bxd.
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    The BXD Index is a passive total return index based on (1) buying a 
portfolio consisting of the component stocks of the DJIA, and (2) 
``writing'' (or selling) near-term DJIA call options (DJX), generally 
on the third Friday of each month. This strategy consists of a 
hypothetical portfolio consisting of a ``long'' position indexed to the 
DJIA on which are deemed sold a succession of one-month, at-the-money 
call options on the DJIA (DJX) listed on the CBOE. Dividends paid on 
the component stocks underlying the DJIA and the dollar value of option 
premium deemed received from the sold call options are functionally 
``re-invested'' in the covered DJIA portfolio.
    The value of the BXD Index on any given date will equal: (1) The 
value of the BXD Index on the previous day, multiplied by (2) the daily 
rate of return \13\ on the covered DJIA portfolio on that date. Thus, 
the daily change in the BXD Index reflects the daily changes in value 
of the covered DJIA portfolio, which consists of the DJIA (including 
dividends) and the component DJIA call option (DJX). The daily closing 
price of the BXD Index is calculated and disseminated by the CBOE on 
its Web site at http://www.cboe.com and via OPRA at the end of each 
trading day. The value of the DJIA is disseminated at least once every 
fifteen (15) seconds throughout the trading day. The Exchange believes 
that the dissemination of the DJIA along with the ability of investors 
to obtain DJIA call option (DJX) pricing provides sufficient 
transparency regarding the BXD Index.\14\ In addition, as indicated 
above, the value of the BXD Index is calculated once every trading day, 
thereby providing investors with a daily value of such ``hypothetical'' 
buy-write options strategy on the DJIA.
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    \13\ The daily rate of return on the covered DJIA portfolio is 
based on (a) the change in the closing value of the stocks in the 
DJIA portfolio, (b) the value of ordinary cash dividends on the 
stocks underlying the DJIA, and (c) the change in the market price 
of the call option. The daily rate of return will also include the 
value of ordinary cash dividends distributed on the stocks 
underlying the DJIA that are trading ``ex-dividend'' on that date 
(that is, when transactions in the stock on an organized securities 
exchange or trading system no longer carry the right to receive that 
dividend or distribution) as measured from the close in trading on 
the previous day.
    \14\ Call options on the DJIA (DJX) are traded on the CBOE, and 
both last sale and quotation information for the call options are 
disseminated in real-time through OPRA. The Exchange states that the 
value of the BXD can be readily approximated as a function of 
observable market prices throughout the trading day. In particular, 
such a calculation would require information on the current price of 
the DJIA and specific nearest-to-expiration call and put options on 
that Index. The Exchange represents that these components trade in 
highly liquid markets, and real-time prices are available 
continuously throughout the trading day from a number of sources 
including Bloomberg and the CBOE.
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Generic Listing Standards for Index-Linked Securities
    The Exchange represents that, consistent with Section 107D(g)(1) of 
the Company Guide, the Index Securities based on the BXM or BXD, as 
applicable, will comply with the conditions of the applicable 
Commission orders regarding such Index.\15\ For example, Index 
Securities based on the Indexes are subject to the condition in the 
Commission's orders requiring the Exchange to disseminate an Indicative 
Value. In addition, the Commission's orders also provide that if the 
Indexes cease to be calculated and disseminated, the Exchange would 
undertake to delist the Notes.
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    \15\ See supra note 7.
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    To date, the Exchange has listed non-principal protected Index 
Securities based on the BXM with and without the payment of 
interest.\16\ These Index Securities are also subject to an exchange 
option by investors and redemption by the issuer. As noted above, the 
BXM and BXD are not calculated or disseminated continuously throughout 
the trading day. Instead, the CBOE calculates the value of each Index 
shortly after the close. Pursuant to the previous Commission orders 
regarding the BXM and BXD, the Exchange represents that it will provide 
an Indicative Value of the Index Security based on the BXM or BXD, as 
applicable. The Indicative Value is an updated value of the amount 
investors would receive for the Index Security if exchanged or 
redeemed. The Exchange states that the Indicative Value equals the 
performance of the Index less fees and other adjustment amounts, if 
any. The Indicative Value is calculated by the Amex after the close of 
trading and after the BXM and BXD are calculated for use by investors 
during the next trading day. It is designed to provide investors with a 
daily reference value of the adjusted Index. The Exchange states that 
the Indicative Value may not reflect the precise value of the Index 
Security.
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    \16\ See supra note 7.
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    The new continued listing standards set forth in Section 107D(h) 
provide for the delisting or removal from listing of an Index Security 
under any of the following circumstances:
     If the aggregate market value or the principal amount of 
the securities publicly held is less than $400,000;
     If the value of the Underlying Index is no longer 
calculated and widely disseminated on at least a 15-second basis; or
     If such other event shall occur or condition exists which 
in the opinion of the Exchange makes further dealings on the Exchange 
inadvisable.
    Because the BXM and BXD are not calculated and disseminated every 
15 seconds, the Exchange seeks a limited exception from this continued 
listing requirement. In proposed Commentary .01 to Section 107D of the 
Company Guide, the Exchange provides that, although the BXM and BXD do 
not satisfy the requirements of Section 107D(h), securities based on 
these Indexes may nevertheless be listed and traded pursuant to the 
generic standards set forth in Section 107D. The Exchange believes that 
the dissemination of the S&P 500 with respect to the BXM and the DJIA 
with respect to the BXD, along with the ability of investors to obtain 
call option pricing provides sufficient transparency regarding the 
Indexes. In addition, the value of each Index is calculated once every 
trading day, thereby providing investors with a daily value of such 
``hypothetical'' buy-write options strategy. Given the nature of the 
Indexes as ``buy-write'' strategies coupled with the transparency of 
the underlying S&P 500 or DJIA and related call options, the Exchange 
believes that the dissemination requirement found in Section 107D(h) of 
the Company Guide is not necessary for these particular Indexes. 
Accordingly, the Exchange requests that the Commission approve the 
limited exception found in proposed Commentary .01.
2. Statutory Basis
    The Exchange believes that the proposed rule change, as amended, is 
consistent with section 6(b) of the Act \17\ in general, and furthers 
the objectives of section 6(b)(5) of the Act \18\ 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

[[Page 40072]]

in facilitating transactions in securities, and to remove impediments 
to and perfect the mechanism of a free and open market and a national 
market system.
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    \17\ 15 U.S.C. 78f(b).
    \18\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change, as 
amended, will impose any burden on competition that is not necessary or 
appropriate in furtherance of the purposes of the Act.

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

    The Exchange states that no written comments were solicited or 
received with respect to the proposed rule change, as amended.

III. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-Amex-2005-049 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.
    All submissions should refer to File No. SR-Amex-2005-049. 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 (http://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. Copies of the 
filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File No. SR-Amex-2005-049 and should be submitted on or before August 
2, 2005.

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

    The Amex has asked the Commission to approve the proposal on an 
accelerated basis. After careful consideration, the Commission finds 
that the proposed rule change, as amended, is consistent with the 
requirements of the Act and the rules and regulations thereunder 
applicable to a national securities exchange, and, in particular, with 
the requirements of section 6(b)(5) of the Act.\19\ The Commission 
notes that it has approved several instruments currently listed and 
traded on the Amex which are based on either the BXM or BXD.\20\ The 
Commission finds that the limited exception for the BXM and BXD Indexes 
contained in proposed Commentary .01 to Section 107D of the Company 
Guide from the continued listing requirement under Section 107D(h) of 
the Company Guide that an index be calculated and disseminated every 15 
seconds is consistent with the Act and will promote just and equitable 
principles of trade, and foster cooperation and coordination with 
persons engaged in regulating, clearing, settling, and processing 
information with respect to and facilitating transactions in securities 
consistent with section 6(b)(5) of the Act.\21\ Consistent with Section 
107D(h)(2) of the Company Guide, the limited exception in Commentary 
.01 incorporates additional continued listing requirements in prior 
approval orders that an Indicative Value, reflecting the performance of 
the Index less fees and other adjustments, must be disseminated shortly 
after the close of trading.
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    \19\ 15 U.S.C. 78f(b)(5).
    \20\ See supra note 7.
    \21\ 15 U.S.C. 78f(b)(5). In approving the proposed rule, the 
Commission has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
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    The requirements of Section 107A of the Company Guide (which are 
applicable pursuant to Section 107D(a)) were designed to address the 
concerns attendant to the trading of hybrid securities, like the 
securities linked to the BXM or BXD Indexes contemplated here. For 
example, Section 107A of the Company Guide provides that only issuers 
satisfying substantial asset and equity requirements may issue 
securities such as the Notes. In addition, the Exchange's ``Other 
Securities'' listing standards further require that the Notes have a 
market value of at least $4 million.\22\ In any event, financial 
information regarding the issuers of such securities, in addition to 
the information on the component stocks, which are reporting companies 
under the Act, and the index-linked securities, which will be 
registered under section 12 of the Act, will be available.
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    \22\ See Section 107A(c) of the Company Guide.
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    In approving the product, the Commission recognizes that the 
Indexes are passive total return indexes based on (1) buying a 
portfolio consisting of the component stocks of the S&P 500 or DJIA, as 
applicable, and (2) ``writing'' (or selling) near-term S&P 500 call 
options (SPX) or DJIA call options (DJX), as applicable, generally on 
the third Friday of each month. Given the large trading volume and 
capitalization of the compositions of the stocks underlying the S&P 500 
and DJIA, the Commission believes that the listing and trading of 
securities that are linked to the BXM or BXD Index should not unduly 
impact the market for the underlying securities compromising the S&P 
500 or DJIA, as applicable, or raise manipulative concerns.\23\ 
Moreover, the issuers of the underlying securities comprising the S&P 
500 or DJIA, as applicable, are subject to reporting requirements under 
the Act, and all of the component stocks are either listed or traded 
on, or traded through the facilities of, U.S. securities markets.
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    \23\ Issuers of such Commission-approved BXM or BXD-linked 
securities have disclosed in the relevant prospectuses and 
prospectus supplements that their (and their affiliates') hedging 
activities, including taking positions in the stocks underlying the 
applicable Index and selling call options on such Index, could 
adversely affect the market value of the securities from time to 
time and the redemption amount holders of the securities would 
receive on them. Such hedging activity must, of course, be conducted 
in accordance with applicable regulatory requirements.
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    The Commission also believes that any concerns that a broker-
dealer, such as the issuer of such index-linked securities, or a 
subsidiary providing a hedge for the issuer, will incur undue position 
exposure are minimized by the size of the issuance in relation to the 
net worth of the issuer.\24\
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    \24\ See Section 107D(e) of the Company Guide; see also 
Securities Exchange Act Release Nos. 44913 (Oct. 9, 2001), 66 FR 
52469 (Oct. 15, 2001) (File No. SR-NASD-2001-73) (order approving 
the listing and trading of notes whose return is based on the 
performance of the Nasdaq-100 Index); 44483 (June 27, 2001), 66 FR 
35677 (July 6, 2001) (File No. SR-Amex-2001-40) (order approving the 
listing and trading of notes whose return is based on a portfolio of 
20 securities selected from the Amex Institutional Index); and 37744 
(Sept. 27, 1996), 61 FR 52480 (Oct. 7, 1996) (File No. SR-Amex-96-
27) (order approving the listing and trading of notes whose return 
is based on a weighted portfolio of healthcare/biotechnology 
industry securities).

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[[Page 40073]]

    Finally, the Commission notes that the value of the applicable 
Index will be calculated and disseminated by the CBOE once every 
trading day after the close of trading. However, the Commission notes 
that the value of both the S&P 500 and DJIA will be widely disseminated 
at least once every fifteen seconds throughout the trading day and that 
investors are able to obtain real-time call option pricing on the 
Indexes during the trading day.\25\ Further, the Indicative Value for 
the BXM and BXD index-linked securities, which will be calculated by 
the Amex after the close of trading and after the CBOE calculates the 
BXM and BXD Indexes for use by investors during the next trading day, 
is designed to provide investors with a daily reference value of the 
adjusted Index. Consistent with the Commission's previous orders,\26\ 
the Commission notes that issuers of such products have agreed to 
arrange to have the applicable Index calculated and disseminated on a 
daily basis through a third party in the event that the CBOE 
discontinues calculating and disseminating the Index. In such event, 
the Exchange agrees to obtain Commission approval, pursuant to filing 
the appropriate Form 19b-4, prior to the substitution of the applicable 
Index. Further, the Commission notes that the Exchange has agreed to 
undertake to delist the relevant index-linked securities in the event 
that the CBOE ceases to calculate and disseminate the applicable BXM or 
BXD Index, and the relevant issuer is unable to arrange to have such 
Index calculated and widely disseminated through a third party.
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    \25\ In the event that such dissemination of the S&P 500 and 
DJIA index values (or any successor index) and real-time call option 
pricing is not available, the Exchange has agreed to undertake to 
delist the relevant BXM or BXD index-linked securities. Telephone 
conversation between Jeffrey P. Burns, Associate General Counsel, 
Amex and Florence Harmon, Senior Special Counsel, Division of Market 
Regulation, Commission, on June 30, 2005.
    \26\ See supra note 7.
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    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 Exchange has 
requested accelerated approval because it states that this proposal 
raises no new or novel issues and would permit it, pursuant to Section 
107D of the Company Guide, to list and trade index-linked securities 
based on the BXM and BXD Indexes. The Commission believes that the 
listing and trading of such securities should provide investors with 
additional investment choices and that accelerated approval of the 
proposal would allow investors to begin trading such securities 
promptly. Therefore, the Commission finds good cause, consistent with 
section 19(b)(2) of the Act,\27\ to approve the proposal, as amended, 
on an accelerated basis.
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    \27\ 15 U.S.C. 78s(b)(2).
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V. Conclusion

    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\28\ that the proposed rule change (SR-Amex-2005-049), as amended, 
is hereby approved on an accelerated basis.
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    \28\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\29\
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    \29\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 05-13602 Filed 7-11-05; 8:45 am]
BILLING CODE 8010-01-P