Self-Regulatory Organizations; Order Approving Proposed Rule Change by the Philadelphia Stock Exchange, Inc. and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 1 Relating to an Amendment to Its By-Laws To Replace an On-Floor Equity Governor Position With an On-Floor Philadelphia Board of Trade Governor Position, 15968-15969 [E5-1384]

Download as PDF 15968 Federal Register / Vol. 70, No. 59 / Tuesday, March 29, 2005 / Notices For the Commission, by the Division of Market Regulation, pursuant to delegated authority.20 J. Lynn Taylor, Assistant Secretary. [FR Doc. E5–1380 Filed 3–28–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–51420; File No. SR–NASD– 2005–003] Self-Regulatory Organizations; Order Granting Approval to Proposed Rule Change To Amend Rule 4350(n) and IM–4350–7 To Conform the Time Frame for the Disclosure of a Waiver to a Company’s Code of Conduct to the Time Frame Required for Similar Disclosure by the Commission’s Form 8–K March 23, 2005. On January 12, 2005, the National Association of Securities Dealers, Inc. (‘‘NASD’’), through its subsidiary, the Nasdaq Stock Market, Inc. (‘‘Nasdaq’’), filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend NASD Rule 4350 and related interpretive material to conform the time frame for the disclosure of a waiver to a company’s code of conduct to the time frame required for similar disclosure by the Commission’s Form 8– K. The proposed rule change was published for comment in the Federal Register on February 18, 2005.3 The Commission received no comments on the proposal. NASD Rule 4350(n) and interpretive material IM–4350–7 require issuers listed on Nasdaq to adopt codes of conduct that are applicable to all directors, officers, and employees. Each code of conduct must require that any waiver of the code for executive officers or directors may be made only by the board of directors of the issuer and must be disclosed to shareholders, along with the reasons for the waiver. The rule specifies that issuers (other than foreign private issuers) must disclose such waivers in a Form 8–K within five business days. The proposed rule change would amend the rule and interpretive material to require such disclosure within four business days. 20 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 51197 (February 14, 2005), 70 FR 8414 (February 18, 2005). 1 15 VerDate jul<14>2003 17:01 Mar 28, 2005 Jkt 205001 The Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association,4 and, in particular, the requirements of section 15A(b)(6) of the Act.5 The Commission believes that the proposed timing for disclosure of waivers is consistent with similar requirements of Commission rules concerning disclosure of waivers by issuers (other than foreign private issuers) for principal executive, financial, and accounting officers.6 It is therefore ordered, pursuant to section 19(b)(2) of the Act,7 that the proposed rule change (File No. SR– NASD–2005–003) be, and it hereby is, approved. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.8 J. Lynn Taylor, Assistant Secretary. [FR Doc. E5–1385 Filed 3–28–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–51419; File No. SR–Phlx– 2005–11] Self-Regulatory Organizations; Order Approving Proposed Rule Change by the Philadelphia Stock Exchange, Inc. and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 1 Relating to an Amendment to Its By-Laws To Replace an On-Floor Equity Governor Position With an On-Floor Philadelphia Board of Trade Governor Position March 23, 2005. I. Introduction On January 31, 2005, the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’ or the 4 In approving this proposed rule change, the Commission notes that it has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 5 15 U.S.C. 78o–3(b)(6). 6 Item 406(a) of Regulations S–K and S–B (17 CFR 229.406(a) and 228.406(a)) requires an issuer to disclose whether the issuer has adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. Issuers are also required to disclose waivers of the code that are granted to those individuals. See Item 5.05(b) of Form 8–K (17 CFR 249.308). Recent amendments to Form 8–K shorten the time frame for this disclosure from five business days to four business days. See Securities Act Release No. 8400 (March 16, 2004), 69 FR 15594 (March 25, 2004). These amendments were effective August 23, 2004. 7 15 U.S.C. 78s(b)(2). 8 17 CFR 200.30–3(a)(12). PO 00000 Frm 00152 Fmt 4703 Sfmt 4703 ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’), pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend its By-laws to replace an OnFloor Equity Governor position on the Exchange’s Board of Governors with an On-Floor Philadelphia Board of Trade, Inc. (‘‘PBOT’’) Governor position. On March 17, 2005, the Exchange filed Amendment No. 1 to the proposed rule change.3 The proposed rule change was published in the Federal Register on February 9, 2005.4 No comment letters were received on the proposal. This order approves the proposed rule change, as amended, and grants accelerated approval to Amendment No. 1. II. Description of the Proposal Under the proposal, Article IV, Section 4–1 of the Phlx’s By-laws would be amended to change the composition of the Phlx’s Board of Governors. Currently, two of the On-Floor Governors must be industry Governors who are members primarily engaged in business on the Exchange’s Equity Floor or general partners, executive officers (vice president and above) or members associated with member organizations primarily engaged in business on the Exchange’s Equity Floor. The Exchange proposes to replace one of these OnFloor Equity Governor positions with an On-Floor PBOT Governor position. Any On-Floor PBOT Governor must be a member of PBOT, which is a subsidiary of the Exchange. In addition, Article III, Sections 3–6 of the Phlx’s By-laws would be amended to provide that recommendations for the PBOT Governor candidate would be submitted to the Exchange’s Nominating and Elections Committee by the PBOT Board of Governors. The Exchange believes that the revised Board of Governors composition, with a PBOT representative Governor, more accurately represents the strategic ownership and on-going business interests of the Exchange, while still affording appropriate proportional representation of On-Floor Governors— with three On-Floor Equity Options Governors, one On-Floor Equity Governor and one On-Floor PBOT Governor. 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 In Amendment No. 1, the Exchange revised the statutory basis section of the proposed rule change. 4 See Securities Exchange Act Release No. 51127 (February 2, 2005), 70 FR 6918. 2 17 E:\FR\FM\29MRN1.SGM 29MRN1 Federal Register / Vol. 70, No. 59 / Tuesday, March 29, 2005 / Notices III. Discussion and Commission Findings After careful review, 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 5 and, in particular, the requirements of section 6 of the Act.6 Specifically, the Commission finds that the proposal to convert an On-Floor Equity Governor position into an On-Floor PBOT Governor position is consistent with section 6(b)(3) of the Act,7 which, among other things, requires that an exchange assure a fair representation of members in the selection of its directors and administration of its affairs.8 The Phlx’s Board of Governors is currently composed of the Chairman of the Board of Governors and 21 other Governors. Five Governors (i.e., the OnFloor Governors) are required to be representatives of the Exchange’s trading floor—three from the options trading floor and two from the equities trading floor. Although the proposal would convert one On-Floor Equity Governor position into an On-Floor PBOT Governor position, there still would be three On-Floor Equity Options Governors and one On-Floor Equity Governor on the Phlx’s Board of Governors. In addition, the proposal would not alter the right of Phlx members, through their member organization representatives, to vote on the nominees for the On-Floor Governor positions, including the On-Floor PBOT Governor.9 Moreover, the proposal would not interfere with Phlx members’ right to submit independent nominations for the On-Floor Governor positions, including the On-Floor PBOT 5 The Commission has considered the proposed rule change’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 6 15 U.S.C. 78f. 7 15 U.S.C. 78f(b)(3). 8 To the extent that the proposed rule change runs counter to the Commission’s recent governance and transparency proposals, Securities Exchange Act Release No. 50699 (November 18, 2004), 69 CFR 71125 (December 8, 2004), the Phlx represents that upon adoption of final rulemaking the Phlx will conform its By-laws accordingly. Telephone conversation among Scott Donnini, Vice President, Phlx, Nancy Sanow, Assistant Director, Division of Market Regulation (‘‘Division’’), Commission, Gordon Fuller, Counsel to the Assistant Director, Division, Commission and Geraldine Idrizi, Attorney, Division, Commission, on January 26, 2005. 9 As a result of the Exchange’s recent demutualization, Phlx members, through their member organization’s designated representative, vote on the nominees for the On-Floor Governor positions and the nominees that are selected by members must be elected by the holder of Phlx’s Series A preferred stock. See Phlx By-laws, Article III, Section 3–2. VerDate jul<14>2003 17:01 Mar 28, 2005 Jkt 205001 Governor. Although recommendations for the PBOT Governor position would be submitted to the Phlx’s Nominating and Elections Committee by the PBOT Board of Governors, Phlx members, through their member organization representatives, can independently nominate by written petition candidates for On-Floor Governor positions, which would include the PBOT Governor position.10 Therefore, in the Commission’s view, the proposal is consistent with the Act’s requirement that the Exchange assure the fair representation of its members in the selection of the Exchange’s directors. The Commission finds good cause for approving Amendment No. 1 to the proposed rule change prior to the thirtieth day after the date of the publication of notice thereof in the Federal Register. The Commission notes that the amendment simply corrected a reference to a section of the Act that was contained in the original filing. The Commission therefore believes that it is appropriate to accelerate approval of the amendment so that the proposed rule change may be implemented on a timely basis. 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 (https://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–Phlx–2005–11 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549–0609. All submissions should refer to File Number SR–Phlx–2005–11. 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 (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements PO 00000 with respect to the proposed rule change, as amended, that are filed with the Commission, and all written communications relating to the proposed rule change, as amended, 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 such 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–2005–11 and should be submitted on or before April 19, 2005. V. Conclusion For the foregoing reasons, the Commission finds that the proposed rule change, as amended, is consistent with the Act and the rules and regulations thereunder applicable to a national securities exchange, and, in particular, with section 6(b)(3) of the Act.11 It is therefore ordered, pursuant to section 19(b)(2) of the Act,12 that the proposed rule change (SR–Phlx–2005– 11), as amended, is approved, and Amendment No. 1 is approved on an accelerated basis. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.13 J. Lynn Taylor, Assistant Secretary. [FR Doc. E5–1384 Filed 3–28–05; 8:45 am] BILLING CODE 8010–01–P SMALL BUSINESS ADMINISTRATION [Disaster Declaration # 10081] Alaska Disaster # AK–00002 Disaster Declaration U.S. Small Business Administration. ACTION: Notice. AGENCY: SUMMARY: This is a Notice of the Presidential declaration of a major disaster for Public Assistance Only for the State of Alaska (FEMA–1584–DR ), dated 03/14/2005. 11 15 U.S.C. 78f(b)(3). U.S.C. 78f(b)(2). 13 17 CFR 200.30–3(a)(12). 12 15 10 See Phlx By-laws, Article III, Section 3–7. Frm 00153 Fmt 4703 Sfmt 4703 15969 E:\FR\FM\29MRN1.SGM 29MRN1

Agencies

[Federal Register Volume 70, Number 59 (Tuesday, March 29, 2005)]
[Notices]
[Pages 15968-15969]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-1384]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51419; File No. SR-Phlx-2005-11]


Self-Regulatory Organizations; Order Approving Proposed Rule 
Change by the Philadelphia Stock Exchange, Inc. and Notice of Filing 
and Order Granting Accelerated Approval to Amendment No. 1 Relating to 
an Amendment to Its By-Laws To Replace an On-Floor Equity Governor 
Position With an On-Floor Philadelphia Board of Trade Governor Position

March 23, 2005.

I. Introduction

    On January 31, 2005, the Philadelphia Stock Exchange, Inc. 
(``Phlx'' or the ``Exchange'') filed with the Securities and Exchange 
Commission (``SEC'' or ``Commission''), pursuant to section 19(b)(1) of 
the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to amend its By-laws to replace 
an On-Floor Equity Governor position on the Exchange's Board of 
Governors with an On-Floor Philadelphia Board of Trade, Inc. (``PBOT'') 
Governor position. On March 17, 2005, the Exchange filed Amendment No. 
1 to the proposed rule change.\3\ The proposed rule change was 
published in the Federal Register on February 9, 2005.\4\ No comment 
letters were received on the proposal. This order approves the proposed 
rule change, as amended, and grants accelerated approval to Amendment 
No. 1.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, the Exchange revised the statutory basis 
section of the proposed rule change.
    \4\ See Securities Exchange Act Release No. 51127 (February 2, 
2005), 70 FR 6918.
---------------------------------------------------------------------------

II. Description of the Proposal

    Under the proposal, Article IV, Section 4-1 of the Phlx's By-laws 
would be amended to change the composition of the Phlx's Board of 
Governors. Currently, two of the On-Floor Governors must be industry 
Governors who are members primarily engaged in business on the 
Exchange's Equity Floor or general partners, executive officers (vice 
president and above) or members associated with member organizations 
primarily engaged in business on the Exchange's Equity Floor. The 
Exchange proposes to replace one of these On-Floor Equity Governor 
positions with an On-Floor PBOT Governor position. Any On-Floor PBOT 
Governor must be a member of PBOT, which is a subsidiary of the 
Exchange.
    In addition, Article III, Sections 3-6 of the Phlx's By-laws would 
be amended to provide that recommendations for the PBOT Governor 
candidate would be submitted to the Exchange's Nominating and Elections 
Committee by the PBOT Board of Governors.
    The Exchange believes that the revised Board of Governors 
composition, with a PBOT representative Governor, more accurately 
represents the strategic ownership and on-going business interests of 
the Exchange, while still affording appropriate proportional 
representation of On-Floor Governors--with three On-Floor Equity 
Options Governors, one On-Floor Equity Governor and one On-Floor PBOT 
Governor.

[[Page 15969]]

III. Discussion and Commission Findings

    After careful review, 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 \5\ and, in particular, the requirements of section 
6 of the Act.\6\ Specifically, the Commission finds that the proposal 
to convert an On-Floor Equity Governor position into an On-Floor PBOT 
Governor position is consistent with section 6(b)(3) of the Act,\7\ 
which, among other things, requires that an exchange assure a fair 
representation of members in the selection of its directors and 
administration of its affairs.\8\
---------------------------------------------------------------------------

    \5\ The Commission has considered the proposed rule change's 
impact on efficiency, competition, and capital formation. 15 U.S.C. 
78c(f).
    \6\ 15 U.S.C. 78f.
    \7\ 15 U.S.C. 78f(b)(3).
    \8\ To the extent that the proposed rule change runs counter to 
the Commission's recent governance and transparency proposals, 
Securities Exchange Act Release No. 50699 (November 18, 2004), 69 
CFR 71125 (December 8, 2004), the Phlx represents that upon adoption 
of final rulemaking the Phlx will conform its By-laws accordingly. 
Telephone conversation among Scott Donnini, Vice President, Phlx, 
Nancy Sanow, Assistant Director, Division of Market Regulation 
(``Division''), Commission, Gordon Fuller, Counsel to the Assistant 
Director, Division, Commission and Geraldine Idrizi, Attorney, 
Division, Commission, on January 26, 2005.
---------------------------------------------------------------------------

    The Phlx's Board of Governors is currently composed of the Chairman 
of the Board of Governors and 21 other Governors. Five Governors (i.e., 
the On-Floor Governors) are required to be representatives of the 
Exchange's trading floor--three from the options trading floor and two 
from the equities trading floor. Although the proposal would convert 
one On-Floor Equity Governor position into an On-Floor PBOT Governor 
position, there still would be three On-Floor Equity Options Governors 
and one On-Floor Equity Governor on the Phlx's Board of Governors. In 
addition, the proposal would not alter the right of Phlx members, 
through their member organization representatives, to vote on the 
nominees for the On-Floor Governor positions, including the On-Floor 
PBOT Governor.\9\ Moreover, the proposal would not interfere with Phlx 
members' right to submit independent nominations for the On-Floor 
Governor positions, including the On-Floor PBOT Governor. Although 
recommendations for the PBOT Governor position would be submitted to 
the Phlx's Nominating and Elections Committee by the PBOT Board of 
Governors, Phlx members, through their member organization 
representatives, can independently nominate by written petition 
candidates for On-Floor Governor positions, which would include the 
PBOT Governor position.\10\ Therefore, in the Commission's view, the 
proposal is consistent with the Act's requirement that the Exchange 
assure the fair representation of its members in the selection of the 
Exchange's directors.
---------------------------------------------------------------------------

    \9\ As a result of the Exchange's recent demutualization, Phlx 
members, through their member organization's designated 
representative, vote on the nominees for the On-Floor Governor 
positions and the nominees that are selected by members must be 
elected by the holder of Phlx's Series A preferred stock. See Phlx 
By-laws, Article III, Section 3-2.
    \10\ See Phlx By-laws, Article III, Section 3-7.
---------------------------------------------------------------------------

    The Commission finds good cause for approving Amendment No. 1 to 
the proposed rule change prior to the thirtieth day after the date of 
the publication of notice thereof in the Federal Register. The 
Commission notes that the amendment simply corrected a reference to a 
section of the Act that was contained in the original filing. The 
Commission therefore believes that it is appropriate to accelerate 
approval of the amendment so that the proposed rule change may be 
implemented on a timely basis.

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 (https://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-Phlx-2005-11 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-Phlx-2005-11. 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 (https://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change, as 
amended, that are filed with the Commission, and all written 
communications relating to the proposed rule change, as amended, 
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 such 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-2005-11 and should be 
submitted on or before April 19, 2005.

V. Conclusion

    For the foregoing reasons, the Commission finds that the proposed 
rule change, as amended, is consistent with the Act and the rules and 
regulations thereunder applicable to a national securities exchange, 
and, in particular, with section 6(b)(3) of the Act.\11\
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78f(b)(3).
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\12\ that the proposed rule change (SR-Phlx-2005-11), as amended, 
is approved, and Amendment No. 1 is approved on an accelerated basis.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78f(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E5-1384 Filed 3-28-05; 8:45 am]
BILLING CODE 8010-01-P
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