Browse: Departments Dates Agencies
SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission
DOCUMENT ID: [Release No. 34-58928; File No. SR-NYSE-2008-109]
NOTICE: NOTICES
ACTION: Self-Regulatory Organizations; Proposed Rule Changes:
SUBJECT CATEGORY: Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change To Clarify Amendments to ``Other Securities'' Initial Listing Standard
DOCUMENT SUMMARY: November 10, 2008.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b4 thereunder,\2\ notice is hereby given that
on October 31, 2008, New York Stock Exchange LLC (``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 Exchange. The
Commission is publishing this notice to solicit comments on the proposal from interested persons.
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b4.
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Exchange proposes to amend Section 703.19 of the Exchange's Listed Company Manual (the ``Manual''), the Exchange's initial listing standards for ``Other Securities.'' The proposed amendment would clarify that companies that are not listed on the Exchange that wish to list securities under Section 703.19 must meet one of the Exchange's financial original listing standards for equity listings, but need not meet any of the other initial listing requirements set forth in Section One of the Manual.
The text of the proposed rule change is available on the Exchange's
Web site (http://www.nyse.com), at the Exchange's Office of the Secretary, and at the Commission's Public Reference Room.
II. SelfRegulatory 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 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 Exchange has prepared summaries, set forth in Sections A, B, and C below, of
[[Page 69707]]
the most significant aspects of such statements.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend Section 703.19 of the Manual, the
Exchange's initial listing standards for ``Other Securities.'' \3\ The
proposed amendment would clarify that companies that are not listed on
the Exchange that wish to list securities under Section 703.19 must
meet one of the Exchange's financial original listing standards for
equity listings, but need not meet any of the other initial listing requirements set forth in Section One of the Manual.
\3\ Section 703.19 was adopted to provide the Exchange with the
flexibility to list securities that could not be readily categorized
under the Exchange's traditional listing standards for common and
preferred stocks, debt securities and warrants. Section 703.19 was
intended to provide flexibility to enable the Exchange to consider
the listing of new securities on a casebycase basis, in light of
the suitability of the issue for auction market trading. Section
703.19 is not intended to accommodate the listing of securities that
raise significant new regulatory issues, which would require a
separate filing with the Commission. See Securities Exchange Act
Release No. 28217 (July 18, 1990) 55 FR 30056 (July 24, 1990) (SR NYSE9030).
The Exchange has long required that unlisted companies wishing to list securities under Section 703.19 must meet its initial common stock listing standards as set forth in Sections 102.01102.03 and 103.0105 of the Manual. While these sections contain common stock distribution requirements (such as the requirement of Section 102.01A that companies listing in connection with an IPO must have at least 400 round lot holders and 1.1 million publiclyheld shares) and public float requirements (such as the requirement of 102.01B that IPOs must have a minimum float of $60 million and all other companies must have a public float of $100 million at the time of initial listing), the Exchange has not imposed these standards with respect to an issuer's common stock when it is only listing securities under Section 703.19. Rather, the Exchange has interpreted the requirement of Section 703.19 as being simply that the company must meet the financial requirements of one of the Exchange's initial listing standards as set forth in Section 102.01C (i.e., the Earnings Test, the Valuation/Revenue Test, the Pure Valuation/Revenue Test and the Affiliated Company Test) or Section 103.01C [sic] (i.e., the Earnings Test, the Valuation/Revenue Test, the Pure Valuation/Revenue Test and the Affiliated Company Test). While the Exchange strongly believes that it needs to ensure that any company that lists its securities under Section 703.19 is of the financial caliber that is required of an NYSE company, it does not believe the common stock distribution and public float requirements are relevant to this qualitative analysis as these requirements are relevant solely with respect to the quality of the trading market in the common stock.
Recently, the Exchange amended its common stock initial listing
standards in Section 102.01B and 103.01A to require listing applicants
at the time of listing to have a closing price, or if listing in
connection with an IPO, an IPO price of $4 at the time of initial
listing.\4\ The Exchange believes that the same rationale articulated
above with respect to distribution and public float requirements
applies in the case of this price requirement, i.e., it is relevant to
the quality of the trading market for the common stock but not to the
qualitative analysis the Exchange performs with respect to a company wishing to list securities under Section 703.19.
\4\ See Securities Exchange Act Release No. 27597 [sic] (May 6, 2008), 73 FR 27597 (May 13, 2008) (SRNYSE200817).
To avoid any ambiguity in the application of Section 703.19 to companies that do not have their common stock listed on the Exchange, the Exchange proposes to replace the requirement that companies must meet the Exchange's initial common stock listing standards as set forth in Sections 102.01102.03 and 103.0105 of the Manual with a more narrowlytailored requirement that such companies must meet one of the financial standards in Section 102.01C or, if applicable, in the case of foreign companies, Section 103.01B. The Exchange also proposes to remove the subheading (``Earnings/Net Tangible Assets'') from the second paragraph of Section 703.19, as it is a remnant from a much earlier version of the rule and is a source of confusion.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \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 free and open market
and, in general, to protect investors and the public interest. The
Exchange believes that the proposed amendment is consistent with the
protection of investors and the public interest in that the Exchange
will continue to apply stringent eligibility requirements to securities listed under Section 703.19.
\5\ 15 U.S.C. 78f(b)(5).
B. SelfRegulatory Organization's Statement on Burden on Competition
The Exchange does not believe that this proposed rule change would
impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
C. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received from Members, Participants or Others
Written comments on the proposed rule change were neither solicited nor received.
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 selfregulatory 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 is consistent with the Act. Comments may be submitted by any of the following methods:
Electronic Comments
Paper Comments
[[Page 69708]]
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, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. 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 Number SRNYSE2008109 and should be submitted on or before December 10, 2008.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\6\
\6\ 17 CFR 200.303(a)(12).
Florence E. Harmon,
Acting Secretary.
[FR Doc. E827419 Filed 111808; 8:45 am]
BILLING CODE 801101P
SUMMARY: New York Stock Exchange LLC,
DOCUMENT BODY 2: November 10, 2008.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b4 thereunder,\2\ notice is hereby given that
on October 31, 2008, New York Stock Exchange LLC (``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 Exchange. The
Commission is publishing this notice to solicit comments on the proposal from interested persons.
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b4.
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Exchange proposes to amend Section 703.19 of the Exchange's Listed Company Manual (the ``Manual''), the Exchange's initial listing standards for ``Other Securities.'' The proposed amendment would clarify that companies that are not listed on the Exchange that wish to list securities under Section 703.19 must meet one of the Exchange's financial original listing standards for equity listings, but need not meet any of the other initial listing requirements set forth in Section One of the Manual.
The text of the proposed rule change is available on the Exchange's
Web site (http://www.nyse.com), at the Exchange's Office of the Secretary, and at the Commission's Public Reference Room.
II. SelfRegulatory 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 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 Exchange has prepared summaries, set forth in Sections A, B, and C below, of
[[Page 69707]]
the most significant aspects of such statements.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend Section 703.19 of the Manual, the
Exchange's initial listing standards for ``Other Securities.'' \3\ The
proposed amendment would clarify that companies that are not listed on
the Exchange that wish to list securities under Section 703.19 must
meet one of the Exchange's financial original listing standards for
equity listings, but need not meet any of the other initial listing requirements set forth in Section One of the Manual.
\3\ Section 703.19 was adopted to provide the Exchange with the
flexibility to list securities that could not be readily categorized
under the Exchange's traditional listing standards for common and
preferred stocks, debt securities and warrants. Section 703.19 was
intended to provide flexibility to enable the Exchange to consider
the listing of new securities on a casebycase basis, in light of
the suitability of the issue for auction market trading. Section
703.19 is not intended to accommodate the listing of securities that
raise significant new regulatory issues, which would require a
separate filing with the Commission. See Securities Exchange Act
Release No. 28217 (July 18, 1990) 55 FR 30056 (July 24, 1990) (SR NYSE9030).
The Exchange has long required that unlisted companies wishing to list securities under Section 703.19 must meet its initial common stock listing standards as set forth in Sections 102.01102.03 and 103.0105 of the Manual. While these sections contain common stock distribution requirements (such as the requirement of Section 102.01A that companies listing in connection with an IPO must have at least 400 round lot holders and 1.1 million publiclyheld shares) and public float requirements (such as the requirement of 102.01B that IPOs must have a minimum float of $60 million and all other companies must have a public float of $100 million at the time of initial listing), the Exchange has not imposed these standards with respect to an issuer's common stock when it is only listing securities under Section 703.19. Rather, the Exchange has interpreted the requirement of Section 703.19 as being simply that the company must meet the financial requirements of one of the Exchange's initial listing standards as set forth in Section 102.01C (i.e., the Earnings Test, the Valuation/Revenue Test, the Pure Valuation/Revenue Test and the Affiliated Company Test) or Section 103.01C [sic] (i.e., the Earnings Test, the Valuation/Revenue Test, the Pure Valuation/Revenue Test and the Affiliated Company Test). While the Exchange strongly believes that it needs to ensure that any company that lists its securities under Section 703.19 is of the financial caliber that is required of an NYSE company, it does not believe the common stock distribution and public float requirements are relevant to this qualitative analysis as these requirements are relevant solely with respect to the quality of the trading market in the common stock.
Recently, the Exchange amended its common stock initial listing
standards in Section 102.01B and 103.01A to require listing applicants
at the time of listing to have a closing price, or if listing in
connection with an IPO, an IPO price of $4 at the time of initial
listing.\4\ The Exchange believes that the same rationale articulated
above with respect to distribution and public float requirements
applies in the case of this price requirement, i.e., it is relevant to
the quality of the trading market for the common stock but not to the
qualitative analysis the Exchange performs with respect to a company wishing to list securities under Section 703.19.
\4\ See Securities Exchange Act Release No. 27597 [sic] (May 6, 2008), 73 FR 27597 (May 13, 2008) (SRNYSE200817).
To avoid any ambiguity in the application of Section 703.19 to companies that do not have their common stock listed on the Exchange, the Exchange proposes to replace the requirement that companies must meet the Exchange's initial common stock listing standards as set forth in Sections 102.01102.03 and 103.0105 of the Manual with a more narrowlytailored requirement that such companies must meet one of the financial standards in Section 102.01C or, if applicable, in the case of foreign companies, Section 103.01B. The Exchange also proposes to remove the subheading (``Earnings/Net Tangible Assets'') from the second paragraph of Section 703.19, as it is a remnant from a much earlier version of the rule and is a source of confusion.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \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 free and open market
and, in general, to protect investors and the public interest. The
Exchange believes that the proposed amendment is consistent with the
protection of investors and the public interest in that the Exchange
will continue to apply stringent eligibility requirements to securities listed under Section 703.19.
\5\ 15 U.S.C. 78f(b)(5).
B. SelfRegulatory Organization's Statement on Burden on Competition
The Exchange does not believe that this proposed rule change would
impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
C. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received from Members, Participants or Others
Written comments on the proposed rule change were neither solicited nor received.
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 selfregulatory 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 is consistent with the Act. Comments may be submitted by any of the following methods:
Electronic Comments
Paper Comments
[[Page 69708]]
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, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. 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 Number SRNYSE2008109 and should be submitted on or before December 10, 2008.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\6\
\6\ 17 CFR 200.303(a)(12).
Florence E. Harmon,
Acting Secretary.
[FR Doc. E827419 Filed 111808; 8:45 am]
BILLING CODE 801101P
Common CFR Searches
14 CFR Part 39 40 CFR Part 52 14 CFR Part 71 33 CFR Part 165 47 CFR Part 73 26 CFR Part 1 50 CFR Part 679 40 CFR Part 180 50 CFR Part 17 33 CFR Part 117 44 CFR Part 67 50 CFR Part 648 14 CFR Part 97 40 CFR Part 63 6 CFR Part 5 33 CFR Part 100 50 CFR Part 622 50 CFR Part 660 26 CFR Part 301 44 CFR Part 65 39 CFR Part 111 40 CFR Part 271 40 CFR Part 300 47 CFR Part 64 40 CFR Parts 52 and 81 50 CFR Part 665 39 CFR Part 3020 50 CFR Part 229 44 CFR Part 64 49 CFR Part 571