2562 Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Notices

22See also supra notes 14–15.

23 15 U.S.C. § 78s(b)(2) (1988).

24 17 CFR 200.30–3(a)(12) (1994).

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

2 17 CFR 240.19b–4.

3The Exchange amended the proposed rule

change to indicate that the Index will be treated as

a narrow based index. See Letter from Nandita

Yagnik, New Product Development, Phlx, to John

Ayanian, Attorney, Office of Market Supervision

(‘‘OMS’’), Division of Market Regulation (‘‘Market

Regulation’’), Commission, dated December 27,

1995 (‘‘Amendment No. 1’’).

4European-style options can be exercised only

during a specific time period prior to expiration of

the options.

5The components of the Index are: Amgen, Inc.;

Applied Materials; Bay Networks, Inc.; CISCO

Systems; Intel Corp.; Microsoft Corp.; MCI

Communications; Oracle Corp.; Sun Microsystems;

and Tele Communications, Inc.

abuses arising from the Index’s

increased position and exercise limits.

Lastly, the Exchange submitted data

comparing the Index to several other

broad-based indexes, including the

CBOE’s Nasdaq 100 Index, which is

comprised of OTC stocks similar to

those companies in the XOC.22 The

Commission believes that the

comparative data confirms that the

proposed increase in the Index’s

position and exercise limits to 25,000

contracts are comparable to those of

similar indexes which trade on other

options exchanges.

IV. Conclusion

For the foregoing reasons, the

Commission finds that the Phlx’s

proposal to increase the position and

exercise limits of the Index from 17,000

to 25,000 contracts is consistent with

the requirements of the Act and the

rules and regulations thereunder. In

addition, the Commission notes that the

change in position and exercise limits

on the XOC does not become effective

until after the expiration of the June

1996 option series.

It is therefore ordered, pursuant to

Section 19(b)(2) of the Act,23 that the

proposed rule change (SR–Phlx–95–38)

is approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.24

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96–1363 Filed 1–25–96; 8:45 am]

BILLING CODE 8010–01–M

[Release No. 34–36744; File No. SR–Phlx–

95–92]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the Philadelphia Stock Exchange, Inc.

Relating to the Listing and Trading of

Options on the PHLX OTC Industrial

Average Index

January 19, 1996.

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

21, 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 Exchange.

On December 29, 1995, the Exchange

filed with the Commission Amendment

No. 1 to the proposed rule change.3 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 Exchange proposes to list and

trade options on the Phlx OTC

Industrial Average Index (‘‘OTC

Industrial Index’’ or ‘‘Index’’), a price

weighted index developed by the Phlx

composed of ten of the largest stocks, by

capitalization, traded through the

National Association of Securities

Dealers Automated Quotations system

and are reported national market system

securities (‘‘NASDAQ/NMS’’). The text

of the proposed rule change is available

at the Office of the Secretary, the

Exchange, 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, the

Exchange included statements

concerning the purpose of and basis for

the proposed rule change. The text of

these statements may be examined at

the places specified in Item IV below.

The Exchange has prepared summaries,

set forth in Section (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 Phlx proposes to list for trading

an European-style option 4 on the Phlx

OTC Industrial Average Index which is

composed of ten of the largest

capitalized common stock issues traded

through NASDAQ/NMS representing

diversified industries including

Telecommunications, Pharmacetuicals,

Semiconductors, and Data Processing.5

The Phlx believes there are numerous

benefits to listing the OTC Industrial

Index options. First, the Exchange

believes that the OTC Industrial Index

will appeal to individual investors as

well as program and basket traders

because the Index reflects the direction

and pricing of some of the nation’s most

important and heavily traded

companies. These stocks are frequently

found in investor and trader portfolios

alike. Second, because the OTC

Industrial Index is based on a relatively

small number of actively traded stocks,

replication of the Index for hedging

purposes with underlying stocks can be

readily accomplished with complete

accuracy. Third, the Exchange does not

believe that the OTC Industrial Index

will be susceptible to manipulation

because the stocks comprising the OTC

Industrial Index are some of the largest

and most widely held common stocks.

Furthermore, all of the component

stocks in the Index are options eligible

and have overlying options currently

trading.

The formula for calculating the OTC

Industrial Index is as follows:

Index Value

SP = the stock price of each component.

= + + + ⋅⋅⋅⋅⋅ +×

SP SP SP SP

divisor

1 2 3 13 100
Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Notices 2563

6The Phlx’s options listing standards, which are

uniform among the options exchanges, provide that

a security underlying an option must, among other

things, meet the following requirements: (1) the

public float must be at least 7,000,000 shares; (2)

there must be a minimum of 2,000 stockholders; (3)

trading volume in the U.S. must have been at least

2.4 million over the preceding twelve months; and

(4) the U.S. market price must have been at least

$7.50 for a majority of the business days during the

preceding three calendar months. See Phlx Rule

1009, Commentary .01.

7Telephone conversation between Michele

Weisbaum, Associate General Counsel, Phlx, and

John Ayanian, Attorney, OMS, Market Regulation,

Commission, on January 18, 1996.

8See Phlx Rules 1000A through 1103A, and 1000

through 1070. 9 15 U.S.C. § 78f(b)(5) (1988).

The current price of each component

issue is added and multiplied by 100

shares to determine the current

aggregate market value of the issues in

the Index. To compute the current Index

value, the aggregate market value is

divided by the divisor. The Index value

was set at a starting value of 150 as of

November 1, 1995.

In order to maintain continuity in the

value of the Index, the Index divisor

will be adjusted for changes in

capitalization of any of the component

issues resulting from, among other

things, mergers, acquisitions, delistings,

and substitutions. Adjustments in the

value of the Index which are

necessitated by the addition and/or the

deletion of an issue from the Index are

made by adding and/or subtracting the

market value (price times shares

outstanding) of the relevant issues. The

value of the Index as of the close of

trading on Friday, January 4, 1996 was

279.27.

The Index value will be updated

dynamically at least once every 15

seconds during the trading day. The

Phlx has retained Bridge Data, Inc. to

compute and do all necessary

maintenance of the Index. Pursuant to

Phlx Rule 1100A, updated Index values

will be disseminated and displayed by

means of primary market prints reported

by the Consolidated Tape Association

and over the facilities of the Options

Price Reporting Authority. The Index

value will also be available on broker/

dealer interrogation devices to

subscribers of the option information.

In accordance with Phlx Rule 1009A,

if any change in the nature of any stock

in the Index occurs as a result of

delisting, merger, acquisition or

otherwise, the Exchange will take

appropriate steps to delete that stock

from the Index and replace it with

another stock which the Exchange

believes would be compatible with the

intended market character of the Index.

In making replacement determinations,

the Exchange will also take into account

the capitalization, liquidity, and

volatility of a particular stock.

The Exchange represents that all of

the stocks comprising the Index are

options eligible 6 and have overlying

options currently trading. At least 90%

of the component issues, by weight, and

80% of the number of stocks, must be

options eligible at all times.7 If at any

time the Index does not meet the 90%/

80% requirement, the Exchange will

submit a Rule 19b–4 filing to the

Commission before opening any new

series of options on the Index for

trading. Additionally, if at any time, the

Exchange determines to increase to

more than thirteen or decrease to fewer

than seven, the number of component

issues in the Index, the Exchange will

submit a new Rule 19b–4 filing.

The settlement value for the Index

options will be based on the opening

values of the component securities on

the date prior to expiration. Index

options will expire on the Saturday

following the third Friday of the

expiration month, and the last day for

trading in an expiring series will be the

second business day (ordinarily a

Thursday) preceding the expiration

date.

The Phlx proposes to employ the

same position and exercise limits

applicable to the Exchange’s other

narrow-based indexes pursuant to Phlx

Rule 1001A(b)(i) and 1002A,

respectively. Exercise prices will be

initially set at 5 point intervals and

additional exercise prices will be added

in accordance with Phlx Rule 1101A(a).

As with the Exchange’s other indexes,

the multiplier for options on the OTC

Industrial Index will be 100. The OTC

Industrial Index options will trade from

9:30 a.m. to 4:10 p.m. eastern time.

The Phlx will trade consecutive and

cycle month series pursuant to Phlx

Rule 1101A. Specifically, there will be

three expiration months from the

March, June, September, December

cycle plus two additional near-term

months so that the three nearest term

months will always be available.

OTC Industrial Index options will be

traded pursuant to current Phlx rules

governing the trading of index options.8

The Exchange notes that procedures

currently used to monitor trading in

each of the Exchange’s other index

options will also be used to monitor the

trading of options on the OTC Industrial

Index. These procedures included

having complete access to trading

activity in the underlying securities

which are all traded on the NYSE via

the Intermarket Surveillance Group

Agreement (‘‘ISG Agreement’’) dated

July 14, 1983, as amended on January

29, 1990.

The Exchange believes that the

proposed rule change is consistent with

Section 6 of the Act, in general, and

furthers the objectives of Section

6(b)(5),9 in particular, in that it is

designed to prevent fraudulent and

manipulative acts and practices, to

facilitate transactions in securities, and

to remove impediments to and perfect

the mechanism of a free and open

market.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

The Exchange does not believe that

the proposed rule change will impose

any 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 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.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of the

submission, all subsequent

amendments, all written statements

with respect to the proposed rule

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
2564 Federal Register / Vol. 61, No. 18 / Friday, January 26, 1996 / Notices

10 17 CFR 200.30–3(a)(12).

available for inspection and copying at

the Commission’s Public Reference

Section, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of the PHLX. All submissions

should refer to SR–Phlx–95–92 and

should be submitted by February 16,

1996.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.10

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 96–1364 Filed 1–25–96; 8:45 am]

BILLING CODE 8010–01–M

SMALL BUSINESS ADMINISTRATION

[Application No. 99000180]

Enterprise Fund, L.P.; Notice of Filing

of Application for a License To Operate

as a Small Business Investment

Company

Notice is hereby given of the filing of

an application with the Small Business

Administration (SBA) pursuant to

Section 107.102 of the Regulations

governing small business investment

companies (13 CFR 107.102 (1995)) by

Enterprise Fund, L.P., 150 North

Meramec, Clayton, Missouri 63105–

3753 for a license to operate as a small

business investment company (SBIC)

under the Small Business Investment

Act of 1958, as amended, (15 U.S.C. et.

Seq.), and the Rules and Regulations

promulgated there under. Enterprise

Fund, L.P., is a Delaware limited

partnership. The Fund investments will

be made primarily in small business

concerns located in the St. Louis,

Missouri metropolitan area. Enterprise

Fund, L.P. may also consider

investments in the Eastern Missouri and

Southern Illinois regions, and the Fund

may make a limited number of

investments in businesses located

within a 250-mile radius of St. Louis.

The General Partner of Enterprise

Fund, L.P. is Enterprise Capital

Management, Inc. The president of the

General Partner is Joseph D. Garea. Mr.

Garea has extensive experience in

banking, finance, and investment

analysis.

Enterprise Fund, L.P. will begin

operations with committed capital of

$10,050,000 and will be a source of

equity and debt financings for qualified

small business concerns. The SBIC GP

will not engage in any business other

than serving as general partner of the

applicant. The applicant will operate

without SBA leverage. The following

limited partners will own 10 percent or

more of the proposed SBIC:

Name and Percentage of Ownership

General American Insurance Co., c/o

Leonard Rubenstein, 700 Market

Street, St. Louis, MO 63101: 30%

Enterbank Holdings, Inc., c/o James C.

Wagner, 150 N. Meramec, Clayton,

MO 63105: 10%

Investments are contemplated in

various manufacturing, distribution, and

service businesses where the portfolio

company’s position offers growth

potential through increased market

share or growth in the market or niche.

No industry is specifically targeted or

excluded; however, the mix of portfolio

companies is expected to mirror the

general business population of the

region. Investments in high technology

companies, restaurants, or companies in

those industries prohibited in the

regulations promulgated by the SBA

will not be pursued.

Matters involved in SBA’s

consideration of the application include

the general business reputation and

character of the proposed owners and

management, and the probability of

successful operations of the new

company under their management,

including profitability and financial

soundness in accordance with the Act

and Regulations.

Notice is hereby given that any person

may, not later that 15 days from the date

of publication of this Notice, submit

written comments on the proposed SBIC

to the Associate Administrator for

Investment, Small Business

Administration, 409 Third Street, SW,

Washington, D.C. 20416.

A copy of this Notice will be

published in a newspaper of general

circulation in Clayton, Missouri.

(Catalog of Federal Domestic Assistance

Programs No. 59.011, Small Business

Investment Companies.)

Dated: January 22, 1996.

Don A. Christensen,

Associate Administrator for Investment.

[FR Doc. 96–1278 Filed 1–25–96; 8:45 am]

BILLING CODE 8025–01–P

[Application No. 99000179]

Wells Fargo Small Business

Investment Company, Inc.; Notice of

Filing of Application for a License To

Operate as a Small Business

Investment Company

Notice is hereby given of the filing of

an application with the Small Business

Administration (SBA) pursuant to

Section 107.102 of the Regulations

governing small business investment

companies (13 CFR 107.102 (1995)) by

Wells Fargo Small Business Investment

Company, Inc., One Montgomery Street,

West Tower, Suite 2530, San Francisco,

CA 94104 for a license to operate as a

small business investment company

(SBIC) under the Small Business

Investment Act of 1958, as amended, (15

U.S.C. et. seq.), and the Rules and

Regulations promulgated there under.

Wells Fargo Small Business Investment

Company, Inc., is a California

corporation. The Fund’s principal

geographic operating area will be

California, however the applicant may

from time to time review selective

opportunities throughout the United

States.

The applicant’s only stockholder is

Wells Fargo Equity Capital, Inc. There is

only one class of stock. All shares have

equal voting rights regarding dividends,

liquidation and other organic matters,

all in accordance with the laws of the

State of California. The stock is not

subject to redemption. The responsible

managers of the applicant are Richard R.

Green, President, and Steven W. Burge,

Managing Director. Both Mr. Green and

Mr. Burge will devote as much of their

time as is necessary to manage the

affairs of the applicant. Both Mr. Green

and Mr. Burge have extensive

experience in banking, finance, and

investment analysis.

The initial capitalization of

$5,000,000 has been provided by Wells

Fargo Equity Capital, Inc., the

applicant’s parent. The applicant will

operate without SBA leverage. The

following shareholders will own 10

percent or more of the proposed SBIC:

Name and Percentage of Ownership

Wells Fargo Equity Capital, Inc., One

Montgomery Street, West Tower,

Suite 2530, San Francisco, CA 94104:

100%

The applicant intends to support the

growth and development of small

business concerns in the State of

California through a focus on the capital

needs of small but viable enterprises

that fall into the main stream of

American business. The applicant

expects to contribute to the small

business community by establishing

itself as a reliable source of

supplimentary risk capital having

different industry interests and different

investment criteria than may be

generally available in the market place.

Matters involved in SBA’s

consideration of the application include

the general business reputation and

character of the proposed owners and

management, and the probability of