Federal Register / Vol. 70, No. 191 / Tuesday, October 4, 2005 / Notices 57919 

6See supra note 5. 

7 15 U.S.C. 78f(b). 

8 15 U.S.C. 78f(b)(5). 

9 15 U.S.C. 78f(b)(6) and (7). 

10 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A). 

4 17 CFR 240.19b–4(f)(6). 

5The PHLX Housing SectorSM (HGXSM) is a 

modified capitalization-weighted index composed 

of 21 companies whose primary lines of business 

are directly associated with the U.S. housing 

construction market. The index composition 

encompasses residential builders, suppliers of 

aggregate, lumber and other construction materials, 

Continued 

it does not minimize the importance of 

compliance with these rules and all 

other rules subject to the imposition of 

fines under the Exchange’s MRP. The 

Exchange relies on its MRP as a tool to 

address enumerated violations to 

provide the Exchange with greater 

flexibility in addressing violations that 

may not require formal disciplinary 

proceedings. Under the proposed rule 

change, the Exchange’s Enforcement 

Department would continue to exercise 

its discretion under PCX Rule 10.12(f) 

and pursue certain cases as a formal 

disciplinary matter under PCX Rule 10.4 

to the extent that the facts or 

circumstances warrant such action.6

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,7 in general, and 

furthers the objectives of Section 6(b)(5) 

of the Act,8 in particular, in that it 

would promote just and equitable 

principles of trade, facilitate 

transactions in securities, remove 

impediments to and perfect the 

mechanisms of a free and open market 

and a national market system, and 

protect investors and the public interest. 

The proposal is also consistent with, 

and furthers the objectives of, Sections 

6(b)(6) and 6(b)(7) of the Act 9 in that it 

would help ensure that members and 

persons associated with members are 

appropriately disciplined for violations 

of the Act, the rules and regulations 

thereunder, and the rules of the 

Exchange, and provide a fair procedure 

for disciplining members and persons 

associated with members. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change would impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the 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, 

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 rulecomments@sec.gov. Please include File 

Number SR–PCX–2005–98 on the 

subject line. 

Paper comments 

• Send paper comments in triplicate 

to Jonathan G. Katz, Secretary, 

Securities and Exchange Commission, 

Station Place, 100 F Street, NE., 

Washington, DC 20549–9303. 

All submissions should refer to File 

Number SR–PCX–2005–98. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site 

(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 

Section, 100 F Street, NE., Washington, 

DC 20549. Copies of such filing also will 

be available for inspection and copying 

at the principal offices of the Exchange. 

All comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–PCX–2005–98 and should 

be submitted on or before October 25, 

2005. 

For the Commission by the Division of 

Market Regulation, pursuant to delegated 

authority.10

Jonathan G. Katz, 

Secretary. 

[FR Doc. 05–19807 Filed 10–3–05; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–52512; File No. SR–Phlx–

2005–50] 

Self-Regulatory Organizations; 

Philadelphia Stock Exchange, Inc.; 

Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change Relating To Reduce the Value 

of PHLX Housing SectorSM Index 

Options by Half 

September 27, 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 

September 15, 2005, the Philadelphia 

Stock Exchange, Inc. (‘‘Phlx’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (‘‘SEC’’ or 

‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Phlx. The Phlx filed the proposal 

pursuant to Section 19(b)(3)(A) under 

the Act,3 and Rule 19b–4(f)(6) 

thereunder,4 which renders the proposal 

effective upon filing with the 

Commission. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Phlx proposes to reduce the value 

of its PHLX Housing SectorSM Index 

(‘‘Index’’) option (‘‘HGX’’) 5 to one-half 

57920 Federal Register / Vol. 70, No. 191 / Tuesday, October 4, 2005 / Notices 

manufactured housing and mortgage insurers. The 

Index is currently composed of the following 

stocks: American Standard Companies, Beazer 

Homes USA, Inc., Champion Enterprises, Inc., 

Centex Corp., DR Horton, Inc., Hovnanian 

Enterprises, Inc., KB Home, Lennar Corp., Masco 

Corp., MDC Holdings, Inc., OfficeMax, Inc., Pulte 

Homes, PMI Group, Inc., Radian Group, Inc., 

Ryland Group, Inc., Standard Pacific Corp., Temple 

Inland, Inc., Toll Brothers, Inc., USG Corp., Vulcan 

Materials Company, and Weyerhaeuser Company. 

6Phlx Rule 1002A indicates that exercise limits 

for index option contracts shall be equivalent to the 

position limits described in Phlx Rule 1001A. 

7HGX was listed for trading pursuant to Section 

19b–4(e) on July 17, 2002. The initial index value 

of HGX was established on or about January 2, 

2002, at $250 by dividing the total market value of 

all HGX components by a divisor to reach the $250 

valuation. The HGX index value has increased 

substantially with the increase in the total market 

value of the HGX components, leading to the 

proposed market value split that will be achieved 

by increasing the divisor. 

8See Securities Exchange Act Release No. 42814 

(May 23, 2000), 65 FR 35152 (June 1, 2000) (SR–

Phlx–00–11) (two-for-one split of index value 

resulted in a doubling of the applicable position 

and exercise limits until the last expiration month 

expired or traded out, and then reverted to pre-split 

levels). 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(5). 

11 15 U.S.C. 78s(b)(3)(A). 

12 17 CFR 240.19b–4(f)(6). 

its present value by multiplying by two 

the base market divisor used to calculate 

the Index. In addition, the option 

contract position and exercise limits 

applicable to the HGX (currently 31,500 

contracts per Rule 1001A) will be 

increased to 63,000 contracts until all 

pre-split option contracts expire.6

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 

self-regulatory organization 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 Phlx 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 purpose of the proposed rule 

change is to do a two-for-one split of the 

Index to reduce its value by half. A twofor-one split should have a positive 

effect on overall transaction volumes of 

options on the Index by attracting 

additional liquidity and making option 

premiums more attractive for retail 

investors. A split would allow investors 

to better utilize the HGX as a trading 

and hedging vehicle with a smaller 

capital outlay. 

HGX was listed on the Exchange and 

commenced trading on or about July 17, 

2002,7 and has continued trading. As of 

July 3, 2005, the Index value was 

$571.75 and the near-month at-themoney call premium was $12.50 per 

contract. The Exchange’s proposed 

‘‘two-for-one split’’ of the Index would 

reduce the Index value to one-half of its 

current value, or $285.88; the options 

premium would likewise be reduced by 

half. In order to maintain economic 

equivalence pre and post-split, however, 

the number of HGX contracts will be 

increased two-fold for current contract 

holders, such that for each HGX contract 

currently held, the holder would receive 

two contracts at the reduced post-split 

value, each with a strike price equal to 

one-half of the original strike price. For 

example, the holder of one HGX 570 call 

with a premium of $12.50 would receive 

two HGX 285 calls with a premium of 

$6.25. 

In addition, the position limits 

applicable to HGX, which are currently 

31,500 contracts per Rule 1001A, would 

be increased to 63,000 until such time 

that all pre-split options expire, at 

which point the position limits would 

return to the 31,500 position limit 

specified in Phlx Rule 1001A. This is 

being done to accommodate the twofold increase in the number of contracts 

outstanding. By operation of Phlx Rule 

1002A, exercise limits would be 

equivalent to the position limits 

established in Phlx Rule 1001A. The 

proposed rule change process is similar 

to what has been previously employed 

pursuant to an index value split.8 The 

trading symbol would remain HGX. 

In conjunction with the proposed 

split, the Exchange would continue to 

list strike price intervals surrounding 

the new lower Index value pursuant to 

Phlx Rule 1101A, which will not change 

pursuant to this proposal. The Exchange 

would announce the effective date of 

the split by way of an Exchange 

memorandum to the membership, 

which would also serve as notice of the 

strike price and position limit changes. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,9 in general, and 

furthers the objectives of Section 6(b)(5) 

of the Act,10 in particular, in that it is 

designed to promote just and equitable 

principles of trade and to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest, by establishing a lower 

Index value, which should, in turn, 

facilitate trading in HGX, creating a 

more liquid trading environment. The 

Exchange believes that reducing the 

value of the Index should not raise 

manipulation concerns and should not 

cause adverse market impact because 

the Exchange will continue to employ 

its surveillance procedures and has 

proposed an orderly procedure to 

achieve the Index split, including 

adequate prior notice to market 

participants. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any inappropriate burden on 

competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received from 

Members, Participants or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The Phlx has filed the proposed rule 

change pursuant to Section 19(b)(3)(A) 

of the Act 11 and subparagraph (f)(6) of 

Rule 19b-4 thereunder.12 Because the 

foregoing proposed rule change: (1) 

Does not significantly affect the 

protection of investors or the public 

interest; (2) does not impose any 

significant burden on competition; and 

(3) does not become operative for 30 

days from the date of filing, or such 

shorter time as the Commission may 

designate if consistent with the 

protection of investors and the public 

interest, the proposed rule change has 

become effective pursuant to Section 

19(b)(3)(A) of the Act and Rule 19b–

4(f)(6) thereunder. As required under 

Rule 19b–4(f)(6)(iii), the Phlx provided 

the Commission with written notice of 

its intent to file the proposed rule 

change at least five business days prior 

to filing the proposal with the 

Commission or such shorter period as 

designated by the Commission. 

A proposed rule change filed under 

Rule 19b–4(f)(6) normally does not 

become operative prior to 30 days after 

the date of filing. However, Rule 19b–

4(f)(6)(iii) permits the Commission to 

designate a shorter time if such action 

is consistent with the protection of 

investors and the public interest. The 

Federal Register / Vol. 70, No. 191 / Tuesday, October 4, 2005 / Notices 57921 

13The Exchange plans to issue a memorandum to 

membership announcing an effective date of the 

split that is prior to expiration of the 30-day 

operative period. Telephone conversation between 

Jurij Trypupenko, Director, Phlx, and Florence 

Harmon, Senior Special Counsel, Commission, on 

September 26, 2005. 

14For purposes only of waiving the operative 

delay for this proposal, the Commission has 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. 15 

U.S.C. 78c(f). 

15See supra, note 8. 16 17 CFR 200.30–3(a)(12). 

Exchange has requested that the 

Commission waive the 30-day operative 

delay specified in Rule 19b–4(f)(6), so 

that all options traded on the indexes 

can be treated uniformly.13

The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest.14

Specifically, the Commission believes 

that the Phlx’s proposal raises no new 

issues or regulatory concerns that the 

Commission did not consider in 

approving a similar proposal of a twofor-one split.15 Additionally, the 

Commission notes that the Exchange 

will continue to employ its surveillance 

procedures and has proposed an orderly 

procedure to achieve the Index split, 

including adequate prior notice to 

market participants. For these reasons, 

the Commission designates that the 

proposal become operative immediately. 

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission may summarily abrogate 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an E-mail to rulecomments@sec.gov. Please include File 

Number SR–Phlx–2005–50 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 

Number SR–Phlx–2005–50. 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 

Section, 100 F Street, NE., Washington, 

DC 20549. Copies of this filing also will 

be available for inspection and copying 

at the principal office of the Phlx. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–Phlx–2005–50 and should 

be submitted on or before October 25, 

2005. 

For the Commission, by the Division of 

Market Regulation, pursuant to delegated 

authority.16

Jonathan G. Katz, 

Secretary. 

[FR Doc. 05–19806 Filed 10–3–05; 8:45 am] 

BILLING CODE 8010–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #10205 and #10206] 

Louisiana Disaster #LA–00004 

AGENCY: U.S. Small Business 

Administration 

ACTION: Notice. 

SUMMARY: This is a Notice of the 

Presidential declaration of a major 

disaster for the State of Louisiana 

(FEMA–1607–DR), dated 09/24/2005. 

Incident: Hurricane Rita. 

Incident Period: 09/23/2005 and 

continuing. 

Effective Date: 09/24/2005. 

Physical Loan Application Deadline 

Date: 11/23/2005. 

EIDL Loan Application Deadline Date: 

06/26/2006. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Disaster Area Office 3, 

14925 Kingsport Road Fort Worth, TX 

76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street, Suite 6050, Washington, 

DC 20416. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

President’s major disaster declaration on 

09/24/2005, applications for disaster 

loans may be filed at the address listed 

above or other locally announced 

locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Parishes: 

Beauregard, Calcasieu, Cameron, 

Jefferson Davis, and Vermilion. 

Contiguous Parishes/Counties: 

Louisiana: 

Acadia, Allen, Evangeline, Iberia, 

Lafayette, and Vernon. Texas: 

Jefferson, Newton, and Orange. 

The Interest Rates are: 

Percent 

Homeowners With Credit Available Elsewhere: ........................ 5.375 

Homeowners Without Credit 

Available Elsewhere: ................. 2.687 

Businesses With Credit Available 

Elsewhere: ................................ 6.557 

Businesses & Small Agricultural 

Cooperatives Without Credit 

Available Elsewhere: ................. 4.000 

Other (Including Non-Profit Organizations) With Credit Available 

Elsewhere: ................................ 4.750 

Businesses and Non-Profit Organizations Without Credit Available Elsewhere ......................... 4.000 

The number assigned to this disaster for 

physical damage is 102058 and for economic 

injury is 102060. (Catalog of Federal 

Domestic Assistance Numbers 59002 and 

59008) 

Herbert L. Mitchell, 

Associate Administrator for Disaster 

Assistance. 

[FR Doc. 05–19835 Filed 10–3–05; 8:45 am] 

BILLING CODE 8025–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #10203 and #10204] 

Texas Disaster #TX–00066 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice.