Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Notices 67377

appropriate to reflect the differences

between unit investment trusts and

open-end management investment

companies) and a schedule setting forth

the number and date of each installment

payment.

B. Condition for Exemption From

Section 14(a)

Applicants will comply in all respects

with the requirements of rule 14a–3,

except that the Equity Trusts will not

restrict their portfolio investments to

‘‘eligible trust securities.’’

C. Conditions for Exemption From

Section 17(a)

1. Each sale of Equity Securities by an

Index Trust, or Eligible Companies’

securities by a State Trust, to a New

Trust will be effected at the closing

price of the securities sold on the

applicable Exchange or the NasdaqNMS on the sale date, without any

brokerage charges or other remuneration

except customary transfer fees, if any.

2. The nature and conditions of such

transactions will be fully disclosed to

investors in the appropriate prospectus

of each future Rollover Trust and new

Trust.

3. The trustee of each Rollover Trust

and New Trust will (a) review the

procedures discussed in the application

relating to the sale of securities from a

Rollover Trust and the purchase of those

securities for deposit in a New Trust

and (b) make such changes to the

procedures as the trustee deems

necessary that are reasonably designed

to comply with paragraphs (a) through

(d) of rule 17a–7.

4. A written copy of these procedures

and a written record of each transaction

pursuant to any order granting the

application will be maintained as

provided in rule 17a–7(f).

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–31513 Filed 12–28–95; 8:45 am]

BILLING CODE 8010–01–M

[Investment Company Act Release No.

21618; 811–7684]

Household Personal Portfolios

December 22, 1995.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Deregistration under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANT: Household Personal

Portfolios.

RELEVANT ACT SECTION: Section 8(f).

SUMMARY OF APPLICATION: Applicant

requests an order declaring that it has

ceased to be an investment company.

FILING DATES: The application was filed

on August 10, 1995 and amended on

December 12, 1995.

HEARING OR NOTIFICATION OF HEARING: An

order granting the application will be

issued unless the SEC orders a hearing.

Interested persons may request a

hearing by writing to the SEC’s

Secretary and serving applicant with a

copy of the request, personally or by

mail. Hearing requests should be

received by the SEC by 5:30 p.m. on

January 16, 1996 and should be

accompanied by proof of service on the

applicant, in the form of an affidavit or,

for lawyers, a certificate of service.

Hearing requests should state the nature

of the writer’s interest, the reason for the

request, and the issues contested.

Persons may request notification of a

hearing by writing to the SEC’s

Secretary.

ADDRESSES: Secretary, SEC, 450 5th

Street, NW., Washington, D.C. 20549.

Applicant, 2 North LaSalle Street,

Chicago, Illinois 60602.

FOR FURTHER INFORMATION CONTACT:

Sarah A. Buescher, Staff Attorney, at

(202) 942–0573, or Alison E. Baur,

Branch Chief, at (202) 942–0564

(Division of Investment Management,

Office of Investment Company

Regulation).

SUPPLEMENTARY INFORMATION: The

following is a summary of the

application. The complete application

may be obtained for a fee from the SEC’s

Public Reference Branch.

Applicant’s Representations

1. Applicant is an open-end,

diversified management investment

company organized as a Massachusetts

business trust. Applicant has five

portfolios; Growth Equity Portfolio;

Equity Income Portfolio; Fixed Income

Portfolio; Tax-Exempt Income Portfolio;

and Short-Term Income Portfolio.

2. SEC records indicate that applicant

registered under the Act on April 28,

1993 by filing a notification of

registration on Form N–8A pursuant to

section 8(a) of the Act. Also on that

date, applicant filed a registration

statement on Form N–1A pursuant to

section 8(b) of the Act and the Securities

Act of 1933. The registration statement

became effective on August 3, 1993, and

the initial public offering commenced

on the same date.

3. On December 19, 1994, after

determining that applicant could no

longer provide the desired safety,

diversity, or earnings to shareholders

because of applicant’s small asset base,

applicant’s board of trustees authorized

the appropriate officers to enter into an

Agreement and Plan of Liquidation

(‘‘Plan’’).

4. Pursuant to the Plan, applicant

would be liquidated on February 28,

1995 (‘‘Liquidation Date’’), and on that

date shareholders who had not

redeemed their shares would have them

automatically redeemed. Shareholders

of applicant on or after December 19,

1994 would receive, upon redemption,

the greater of (a) the shareholder’s

account balance (reflecting net asset

value per share) on the date the

redemption request is received or the

Liquidation Date (whichever applies) or

(b) the aggregate amount of the

shareholder’s purchase payments. Such

payment method was used to ensure

that shareholders would not receive less

than their minimum initial investment.

Household International, Inc.,

(‘‘Household’’) the parent of applicant’s

manager/distributor, Hamilton

Investments, Inc., agreed to compensate

any shareholder of record on or after

December 19, 1994 for the amount by

which all purchase payments made by

that shareholder exceeded the

shareholder’s account balance upon

redemption.

5. On February 28, 1995, all

outstanding shares of applicant were

liquidated and the proceeds were paid

in cash to the shareholders.

Distributions to all securityholders in

complete liquidation of their interests

have been made. Applicant did not

incur any brokerage commissions

attributable to the disposition of its

portfolio securities.

6. In connection with the liquidation,

applicant incurred $9,725 of aggregate

expenses, consisting primarily of legal

fees and mailing expenses, all of which

were paid by Household. Household

also reimbursed applicant for

applicant’s remaining unamortized

organizational expenses of $287,710.

7. As of the date of this application,

applicant has no assets and no

outstanding debts or liabilities.

Applicant has no shareholders and is

not a party to any litigation or

administrative proceeding. Applicant is

not presently engaged, nor does it

propose to engage, in any business

activities other than those necessary for

the winding up of its affairs.

8. Applicant intends to file an

instrument required to terminate its

existence as a Massachusetts business

trust.
67378 Federal Register / Vol. 60, No. 250 / Friday, December 29, 1995 / Notices

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

2 17 CFR 240.19b–4.

3See Securities Exchange Act Release No. 36020

(July 24, 1995), 60 FR 39039 (July 31, 1995) (order

approving Commentary .05 to Phlx Rule 1009).

For the Commission, by the Division of

Investment Management, pursuant to

delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 95–31510 FIled 12–28–95; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–36625; File No. SR–Phlx–

95–90]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Philadelphia Stock Exchange, Inc.

Relating to Listing Standards for

Options on Equity Securities Issued in

a Reorganization Transaction Pursuant

to a Public Offering or a Rights

Distribution

December 21, 1995.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on December

19, 1995, the Philadelphia Stock

Exchange, Inc. (‘‘Phlx’’ 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 Phlx. 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 amend its listing

standards in respect of options on

equity securities issues in a spin-off,

reorganization, recapitalization,

restructuring or similar transaction

where the issuance is made pursuant to

a public offering or a rights distribution.

The text of the proposed rule change is

available at the Office of the Secretary,

Phlx, and at the Commission.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

Phlx 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

The purpose of the proposed rule

change is to amend the special listing

standards set forth in Phlx Rule 1009,

Commentary .05 that apply to options

on equity securities issued in certain

spin-offs, reorganizations,

recapitalizations, restructurings or

similar transactions (referred to herein

as ‘‘restructuring transactions’’) so as to

also include securities issued pursuant

to a public offering or a rights

distribution that is part of a

restructuring transaction.

The proposed amendment to Rule

1009, Commentary .05 is intended to

facilitate the listing of options on equity

securities issued in restructuring

transactions (referred to as ‘‘Restructure

Securities’’) by permitting the Exchange

to base its determination as to the

satisfaction of certain of the listing

standards set forth in Exchange Rule

1009 and Commentary .01 thereunder

by reference to (1) specified

characteristics of the ‘‘Original

Security’’ in respect of which the

Restructure Security was issued or

distributed; (2) the trading market of the

Original Security; (3) the number of

shares of the Restructure Security issued

and outstanding; or (4) to the listing

standards of the exchange on which the

Restructure Security is listed. Rule

1009, Commentary .05 would permit the

Exchange to certify a Restructure

Security as options eligible sooner than

if it had to wait until it could base its

certification on characteristics of the

Restructure Security itself, but only in

circumstances where the factors relied

upon make it reasonable to conclude

that the Restructure Security will in fact

satisfy applicable listing criteria.

As recently approved by the

Commission, Phlx Rule 1009,

Commentary .05 does not extend to

restructuring transactions involving the

issuance of a Restructure Security in a

public offering or a rights distribution.3

The questions raised by the proposed

extension of Commentary .05 to Phlx

Rule 1009 to reorganization transactions

involving public offering or rights

distributions reflect that when a

Restructure Security is issued in a

public offering or pursuant to a rights

distribution, it cannot automatically be

assumed that the shareholder

population of the Restructure Security

and the Original Security will be the

same. Instead, the holders of a

Restructure Security issued in a public

offering will be those persons who

subscribed for and purchased the

security in the offering, and the holders

of a Restructure Security issued in a

rights distribution will be those persons

who elected to exercise their rights.

Even in the case of a distribution of

nontransferable rights to shareholders of

the Original Security, not all such

shareholders may choose to exercise

their rights. As a result, it cannot be

assumed that the Restructure Security

will necessarily satisfy listing criteria

pertaining to minimum number of

holders, minimum public float and

trading volume simply because the

Original Security satisfied these criteria.

On the other hand, the Exchange

believes that the same reasons for

wanting to make an options market

available without delay to holders of

securities issued in reorganizations that

do not involve public offerings or rights

distributions apply with equal force to

securities issued in reorganizations that

do involve public offerings or rights

distributions, so long as there can be

reasonable assurance that the securities

satisfy applicable options listing

standards. That is, holders of an

Original Security who utilize options to

manage the risks of their stock positions

may well find themselves to be holders

of both the Original Security and the

Restructure Security following a

reorganization because they chose to

purchase the Restructure Security in a

public offering or to exercise rights in

order to maintain the same investment

position they had prior to the

reorganization. Such holders may want

to continue to use options to manage the

risks of their combined stock position

after the reorganization, but they can do

so only if options on the Restructure

Security are available. The Exchange

believes that it is important to avoid any

undue delay in the introduction of

options trading in such a Restructure

Security in circumstances where there is

sound reason to believe that the

Restructure Security does in fact satisfy

options listing standards.

Accordingly, the Phlx proposes to add

new paragraph (d) to Commentary .05 of

Rule 1009, to address situations where

a Restructure Security is issued

pursuant to a public offering or rights

distribution. Pursuant to the proposed

rule change, the Exchange may certify

the Restructure Security as satisfying

minimum shareholder and minimum

public float requirements on the basis

provided for in approved Commentary

.05(c), only after at least five days of

‘‘regular way’’ trading. Moreover, after

due diligence, the Exchange must have

no reason to believe that the Restructure