Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change and Amendments Nos. 1, 2, 3, 4 and 5 Thereto To Amend Its By-Laws and Charter in Connection With a Restructuring of Its Board of Governors, 14766-14769 [06-2857]

Download as PDF 14766 Federal Register / Vol. 71, No. 56 / Thursday, March 23, 2006 / Notices 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 Written comments on the proposed rule change, as amended, 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 self-regulatory organization consents, the Commission will: (A) By order approve such rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. 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. Copies of such filing also will be available for inspection and copying at the principal offices of the NYSE Arca, Inc. 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–2005–122 and should be submitted on or before April 13, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. Nancy M. Morris, Secretary. [FR Doc. E6–4182 Filed 3–22–06; 8:45 am] BILLING CODE 8010–01–P 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–PCX–2005–122 on the subject line. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53518; File No. SR–Phlx– 2005–93] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change and Amendments Nos. 1, 2, 3, 4 and 5 Thereto To Amend Its By-Laws and Charter in Connection With a Restructuring of Its Board of Governors March 20, 2006. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 • Send paper comments in triplicate notice is hereby given that on December to Nancy M. Morris, Secretary, 30, 2005, the Philadelphia Stock Securities and Exchange Commission, Exchange, Inc. (‘‘Phlx’’ or ‘‘Exchange’’) 100 F Street, NE., Washington, DC filed with the Securities and Exchange 20549–1090. Commission (‘‘Commission’’) the All submissions should refer to File proposed rule change as described in Number SR–PCX–2005–122. This file Items I and II below, which items have number should be included on the been prepared by the Phlx. On February subject line if e-mail is used. To help the 16, 2006, the Exchange filed Commission process and review your Amendment No. 1 to the proposed rule comments more efficiently, please use change; 3 on March 10, 2006, the only one method. The Commission will Exchange filed Amendment No. 2 to the post all comments on the Commission’s Internet Web site (https://www.sec.gov/ 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. rules/sro.shtml). Copies of the 3 In Amendment No. 1, the Phlx revised the submission, all subsequent proposed definitions of the terms ‘‘Independent’’ amendments, all written statements and ‘‘Material Relationship’’ that are to be included with respect to the proposed rule in the Exchange’s By-Laws and made clarifying change that are filed with the changes to the purpose section and to the rule text of the proposed rule change. Commission, and all written wwhite on PROD1PC61 with NOTICES Paper Comments VerDate Aug<31>2005 16:54 Mar 22, 2006 Jkt 208001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 proposed rule change; 4 on March 17, 2006, the Exchange filed Amendment No. 3 to the proposed rule change; 5 and on March 20, 2006, the Exchange filed Amendment Nos. 4 6 and 5 7 to the proposed rule change. The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend its By-Laws and Charter to revise the current structure of the Phlx Board of Governors (‘‘Board’’). Specifically, the Exchange proposes to: (i) Voluntarily conform to certain aspects of the Commission’s proposed SRO Governance Rulemaking, including the incorporation of the concept of ‘‘independent directors;’’ 8 (ii) create a single Vice-Chairman of the Board; (iii) eliminate the distinction between OnFloor and Off-Floor Governors; (iv) make changes to the election of Governors in the By-Laws and Charter; and (v) make other modifications, including revising the composition of various Phlx standing committees. The text of the proposed rule change, as amended, is available at the Commission’s Public Reference Room, at the Exchange’s Web site (https:// www.phlx.com) and at the Exchange’s principal office. 4 In Amendment No. 2, the Phlx incorporated the proposed definition of ‘‘Independent Governor’’ in the Exchange’s Restated Certificate of Incorporation (‘‘Charter’’); incorporated the definition of ‘‘Annual Independence Review’’ in the Exchange’s By-Laws; revised the rule text to clarify the standards to be applied by the Nominating, Elections and Governance Committee in evaluating nominees for Independent Governor; described in the purpose section of the proposed rule change the selection criteria for the position of Vice-Chairman; and made clarifying changes to the rule text. 5 In Amendment No. 3, the Phlx revised the purpose section and the rule text of the proposed rule change to set forth that the Nominating, Elections and Governance Committee shall be composed of five persons as follows: Three Independent Governors (one of whom must be a Designated Independent Governor), one Stockholder Governor, and one Member Governor. 6 In Amendment No. 4, the Phlx deleted revisions, as proposed in the original filing, that would have capitalized the term ‘‘member’’ in various Charter provisions and reinstated in the Charter a reference to ‘‘member (as such term is defined in the Exchange Act).’’ 7 In Amendment No. 5, the Phlx revised the statutory basis section of the proposed rule change. 8 See Securities Exchange Act Release No. 50669 (November 18, 2004), 69 FR 71126 (December 8, 2004) (‘‘Proposed SRO Governance Rulemaking’’). E:\FR\FM\23MRN1.SGM 23MRN1 Federal Register / Vol. 71, No. 56 / Thursday, March 23, 2006 / Notices 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 Phlx included statements concerning the purpose of, and basis for, the proposed rule change, as amended, 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 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 address various governance issues in both the Exchange’s By-Laws and Charter. Conformance to Certain Aspects of the Proposed SRO Governance Rulemaking One purpose of the proposed rule change is to amend the Exchange’s ByLaws and Charter to voluntarily conform to certain aspects of the Proposed SRO Governance Rulemaking, including the concept of ‘‘independent directors’’ as set forth in the proposed rulemaking.9 The Exchange proposes to convert all non-industry 10 positions to independent positions and to add an additional Independent Governor to ensure a majority of Independent Governors in accordance with the Proposed SRO Governance Rulemaking.11 An Independent Governor would be defined as a Governor who has no material relationship with the Exchange or any affiliate of the Exchange, any member of the Exchange or any affiliate of such 9 See id. Single Vice-Chairman The Phlx proposes to amend its ByLaws and Charter to create, in proposed Phlx By-Laws Article V, Section 5–2, a single Vice-Chairman of the Board who would be recommended by the Chairman for nomination by the Nominating, Elections and Governance Committee and elected by the stockholders. The Vice-Chairman would not be subject to a term limit. The ViceChairman would be an individual who, anytime within the prior three years, has been a Member primarily engaged in business on the Exchange’s equity market or equity options market or is a general partner, executive officer (vicepresident or above) or a Member associated with a Member Organization primarily engaged in business on the Exchange’s equity market or equity options market. Currently, the By-Laws require two Vice-Chairmen of the Board, 10 Currently, wwhite on PROD1PC61 with NOTICES ‘‘non-industry’’ is defined as follows: The term non-industry when used in the context of Governors or committee members shall mean (a) public Governors; (b) officers and employees of issuers of securities listed on the Exchange; (c) persons affiliated with brokers and dealers that operate solely to assist the securitiesrelated activities of the business of non-member affiliates (such as brokers or dealers established to (i) distribute an affiliate’s securities which are issued on a continuous or regular basis, or (ii) process the limited buy and sell orders of the shares of employee owners of the affiliate); (d) employees of an entity that is affiliated with a broker or dealer that does not account for a material portion of the revenues of the consolidated entity, and who are primarily engaged in the business of the nonmember entity; and (e) other individuals who would not be industry Governors or committee members. Phlx By-Laws Article I, Section 1–1(t). 11 See supra at note 8. member, or any issuer of securities that are listed or traded on the Exchange or a facility of the Exchange. A material relationship would be defined as a relationship, compensatory or otherwise, that reasonably could affect the independent judgment or decisionmaking of a Governor. The Board would make this independence determination upon a Governor’s nomination and no less frequently than annually and as often as necessary in light of a Governor’s circumstances and pursuant to Article IV, Section 4–4 of the Phlx By-Laws to ensure that the status of all incumbent Independent Governors do not fall outside the definition of Independent.12 The designation of ‘‘Independent’’ would replace the defined terms ‘‘public’’ 13 and ‘‘nonindustry,’’ as presently set forth in the Phlx’s By-Laws and Charter. Currently, the Board consists of 22 Governors.14 Under this proposal, the Board would consist of 23 Governors. Accordingly, the Board would consist of a majority of Independent Governors. VerDate Aug<31>2005 16:54 Mar 22, 2006 Jkt 208001 12 ‘‘Independent’’ would be defined in the Phlx By-Laws, Article 1, Section 1–1(o) as follows: The term ‘‘Independent,’’ when used in the context of Governor or Committee Members, shall mean persons affirmatively determined by the Board as having no Material Relationship with the Exchange or any affiliate of the Exchange, any member of the Exchange or any affiliate of such member, or any issuer of securities that are listed or traded on the Exchange or a facility of the Exchange. 13 ‘‘Public’’ is defined in the Phlx By-Laws Article I, Section 1–1(y) as follows: The term ‘‘public’’ when used in the context of Governors or committee members shall mean non-industry persons who have no material business relationship with a broker, dealer or the Exchange.’’ The proposed rule change would delete the definition of ‘‘public’’ from the Phlx By-Laws. 14 See Phlx Charter Article Seventh, and Phlx ByLaws Article IV, Section 4–1. PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 14767 with one Vice-Chairman elected as an On-Floor Governor by the Members, and the other Vice-Chairman elected as an Off-Floor Governor by the stockholders. The Exchange proposes this change to conform to a structure that is more typical of a for-profit stock corporation and also because the two Vice-Chairmen model is not sustainable if the ‘‘OnFloor’’ and ‘‘Off-Floor’’ distinctions are eliminated, as discussed below. Elimination of the ‘‘On-Floor’’ and ‘‘OffFloor’’ Governor Distinction The Exchange proposes to eliminate the distinction between ‘‘On-Floor’’ 15 and ‘‘Off-Floor’’ 16 Governors, in both its By-Laws and Charter, to allow for greater stockholder representation and, specifically, representation on the Board of the six recently acquired strategic investors.17 Presently, there are five OffFloor Industry Governors elected by the stockholders and five On-Floor Industry Governors elected by the Members. The Exchange proposes to replace this current model with nine positions that would consist of six positions elected by stockholders, two Member positions and one Philadelphia Board of Trade 15 Phlx By-Laws Article IV, Section 4–1 provides that an ‘‘On-Floor Governor’’ is ‘‘an industry Governor and is a member primarily engaged in business on the Exchange’s Equity Floor or a general partner, executive officer (vice president and above) or member associated with a member organization primarily engaged in business on the Exchange’s Equity Floor (On-Floor Equity Governor) * * * [and] is an industry Governor and is a member of the Philadelphia Board of Trade (On-Floor PBOT Governor) * * * [and] is an industry Governor and is a member primarily engaged in business as a specialist on the Exchange’s Equity Options Floor or a general partner, executive officer (vice president and above) or a member associated with a member organization primarily engaged in specialist business on the Exchange’s Equity Options Floor (On-Floor Equity Options Specialist Governor) * * * [and] is an industry Governor and is a member primarily engaged in business as a registered options trader on the Exchange’s Equity Options Floor or a general partner, executive officer (vice president and above) or a member associated with a member organization primarily engaged in registered options trader business on the Exchange’s Equity Options Floor (On-Floor Equity Options Registered Options Trader Governor); and * * * who is an industry Governor and is a member primarily engaged in business on the Exchange’s Equity Options Floor as a floor broker (On-Floor Equity Options Broker Governor).’’ 16 Phlx By-Laws Article IV, Section 4–1 provides that ‘‘Off-Floor Governors’’ are ‘‘industry Governors and general partners, executive officers (vice president or above), or members or participants associated with member or participant organizations which conduct a non-member or non participant public customer business and shall individually not be primarily engaged in business activities on the Exchange Floor.’’ 17 During 2005, six firms invested in the Exchange: Citigroup Financial Products, Inc.; Credit Suisse First Boston NEXT Fund, Inc.; Morgan Stanley & Co., Inc., UBS Securities LLC; Citadel Derivatives Group, LLC; and Merrill Lynch, Pierce Fenner & Smith, Inc. E:\FR\FM\23MRN1.SGM 23MRN1 14768 Federal Register / Vol. 71, No. 56 / Thursday, March 23, 2006 / Notices (‘‘PBOT’’) position. The Member positions and the PBOT position would be elected by Members of the Exchange. Election of Governors The Exchange proposes to amend its By-Laws and Charter to reflect that two of the Independent Governors will be nominated and elected by the Members of the Exchange, as will both Member Governors and the PBOT Governor, in order to maintain the 20% fair representation of membership on the Board.18 The Exchange represents that the proposed amendments to its Charter and By-Laws, in and of themselves, would require minimal changes to the present composition of the Board, subject to a formal analysis and determination by the Board of the qualifications of the Independent Governors, and would be largely a reclassification of Board positions. The Exchange would conform the composition of the Board to the provisions of the proposed rule change as follows: upon the approval of the proposed rule change by the Commission, the Exchange will hold an Annual Meeting of Member and Member Organizations, to be followed by the Annual Meeting of Stockholders to elect the class of Governors for 2006. The class of 2006 Governors will be nominated and elected pursuant to the Charter and By-Laws, as proposed to be amended, with two of the nine Board positions being nominated and selected by the Members and elected by the Trustee of the Series Class A Preferred Stock. The classes of 2007 and 2008 Governors will be permitted to complete their terms but will be appointed by the Nominating, Elections and Governance Committee, with the approval of the Board, to fill the new positions established by the amendments until which time those positions come up for election in either 2007 and 2008 respectively.19 Following the election of the class of 2006, over 20% of the Governors serving on the Board will have been nominated and elected by the Members. wwhite on PROD1PC61 with NOTICES Stockholder Meetings With regard to its Charter, the Phlx seeks to remove Article Ninth to allow greater flexibility in the Exchange’s governance processes. In the absence of this Article, the issue of obtaining the written consent of the stockholders of 18 See Section 6(b)(3) of the Act, 15 U.S.C. 78f(b)(3). See also Proposed SRO Governance Rulemaking. The Exchange states that it is proposing to voluntarily adopt certain concepts addressed in the Commission’s Proposed SRO Governance Rulemaking. 19 See Phlx By-Laws Article IV, Section 4–7. VerDate Aug<31>2005 16:54 Mar 22, 2006 Jkt 208001 the Exchange for any action in lieu of a meeting will be governed by Delaware General Corporation Law, which will allow stockholders to take actions outside of a stockholder meeting by lessthan-unanimous written consent. Other Modifications To conform with the proposed changes to the Board’s composition described above, the Exchange also proposes to amend its By-Laws and Charter sections relating to Board Committees as follows: 20 • The following committees are not affected by the changes described herein with the exception of minor technical modifications: Æ Admissions Æ Options Allocation, Evaluation and Securities Committee Æ Equity Allocation Evaluation and Securities Committee Æ Floor Procedure Æ Foreign Currency Options Æ Marketing Æ Options Æ The Automation Committee currently allows for the Chairman of the Committee to be designated as a NonIndustry or Off-Floor Governor. The proposal would change this designation to a Stockholder or Independent Governor. Æ The Business Conduct Committee is currently composed of three NonIndustry Governors (one of whom must be Public); one Equity Floor Member; one Equity Options Floor Member; one At-Large Floor Member; and three OffFloor Members. The proposal would modify the composition as follows: Three Independent Governors; four Members or persons associated with a Member Organization; one Member who primarily conducts business on the Equity Floor; and one Member who primarily conducts business on the Equity Options Floor. Æ The Compensation Committee is currently composed of one Chairman (who must be a Non-Industry Governor); two Non-Industry Governors (one of whom must be a Public Governor); and the two Vice-Chairmen of the Board. The proposal would modify the composition as follows: Four Independent Governors (one of whom must serve as chairman of the 20 The Exchange notes that no changes are being made to Phlx By-Laws Article X, Section 10–9, its Audit Committee provision. The Commission recently approved a proposed rule change to amend this provision of the Phlx By-Laws to require, among other things, that the members of the Audit Committee be ‘‘Independent Governors.’’ See Securities Exchange Act Release No. 53356 (February 23, 2006), 71 FR 10741 (March 2, 2006) (SR–Phlx–2004–37). PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 committee) and the Vice-Chairman of the Board. Æ The Executive Committee is currently composed of the Chairman of the Board; the two Vice-Chairmen of the Board; the Chairman of the Finance Committee; one Chairman of a floor committee not represented by the OnFloor Vice-Chairman; one Chairman of a floor committee not represented by the Off-Floor Vice-Chairman; one Off-Floor Governor; and two Non-Industry Governors (one of whom must be a Public Governor). The proposal would modify the composition as follows: the Chairman of the Board; the ViceChairman of the Board; two Stockholder Governors; two Independent Governors; the Chairman of the Finance Committee; and two Chairmen of Floor Committees. Æ The Finance Committee is currently composed as follows: the Chairman of the Board; the two Vice-Chairmen of the Board; one On-Floor Member (who may be a Governor); one Off-Floor Member (who may be a Governor); and four NonIndustry Governors (one whom must be a Public Governor). The proposal would modify the composition as follows: the Chairman and Vice-Chairman of the Board; two Members or persons associated with a Member Organization, who may be Governors (one of whom conducts business primarily on the Equity or Equity Options Floor); one Stockholder Governor; and four Independent Governors. The Chairman of this committee would be the ViceChairman of the Board, a Stockholder Governor or a Member Governor. Æ The Nominating and Elections Committee would be renamed the Nominating, Elections and Governance Committee. The purpose of this change is to have the Committee’s name more properly reflect the existing role and function of this Committee. No substantive changes in the Committee’s functions are proposed. The Nominating and Elections Committee is currently composed of the following: The Chairman (who must be a Non-Industry Public Governor); three Non-Industry Governors; one Off-Floor Member (who may be a Governor); one On-Floor Equity Governor; and one On-Floor Equity Options Governor. The proposal would modify the composition as follows: Three Independent Governors (one of whom must be a Designated Independent Governor); one Stockholder Governor; and one Member Governor. The Nominating, Elections and Governance Committee would select its Chairman from among the members of such Committee who are Independent Governors. Constituted in this manner, the interests of the Members of the Exchange, by virtue of E:\FR\FM\23MRN1.SGM 23MRN1 Federal Register / Vol. 71, No. 56 / Thursday, March 23, 2006 / Notices the Member Governor and the Designated Independent Governor who are both elected by the Members, would be represented by at least 20% of the Committee in compliance the fair representation requirement of Section 6(b)(3) of the Act.21 Æ The Quality of Markets Committee would not change in any way, except that ‘‘Non-Industry Governors’’ would be called ‘‘Independent Governors’’ and ‘‘Industry Governors’’ would be called ‘‘Stockholder Governors.’’ In addition, various technical modifications have been made to the Phlx By-Laws for purposes of consistency. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act 22 in general, and furthers the objectives of Section 6(b)(3) of the Act 23 in particular, in that it is designed to assure a fair representation of its members in the selection of its directors and administration of its affairs because the members will elect five Designated Governors, including two Designated Independent Governors, one PBOT Governor, and 2 Member Governors. The Exchange also believes that its proposal furthers the objectives of Section 6(b)(3) of the Act 24 because the Nominating, Elections and Governance Committee will consist of three Independent Governors (one of whom must be a Designated Independent Governor), one Stockholder Governor, and one Member Governor, with the Designated Independent Governor elected by the Members, ensuring greater Member representation. 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 either solicited or received by the Exchange. wwhite on PROD1PC61 with NOTICES III. Date of Effectiveness of the Proposed Rule Within 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) 21 15 U.S.C. 78f(b)(3). U.S.C. 78f(b). 23 15 U.S.C. 78f(b)(3). 24 15 U.S.C. 78f(b)(3). 22 15 VerDate Aug<31>2005 16:54 Mar 22, 2006 Jkt 208001 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. The Phlx has requested accelerated approval of the proposed rule change. While the Commission will not grant accelerated approval at this time, the Commission will consider granting accelerated approval of the proposal at the close of the comment period, 21 days from the date of publication of the proposal in the Federal Register. 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 No. SR–Phlx–2005–93 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–Phlx–2005–93. 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 Commissions 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 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 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 14769 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–2005–93 and should be submitted by April 13, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.25 Jill M. Peterson, Assistant Secretary. [FR Doc. 06–2857 Filed 3–21–06; 11:52 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53496; File No. SR–Phlx– 2005–62] Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change and Amendment No. 1 Thereto Relating to Amending Exchange Delisting Rules To Conform to Recent Amendments to Commission Rules Regarding Removal From Listing and Withdrawal From Registration March 16, 2006. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’)&thnsp;1, and Rule 19b–4 2 thereunder, notice is hereby given that on October 25, 2006, 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, II, and III below, which Items have been prepared by the Phlx. On January 4, 2006, Phlx filed Amendment No. 1 to the proposed rule change.3 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 25 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 In Amendment No. 1, Phlx amended its rule text and the purpose section of the Exchange’s Form 19b–4 to clarify the effective date of the proposed rule change and revised Phlx Rule 809 to state that an issuer proposing to withdraw a security from listing on the Exchange must provide a copy of Form 25 to the Exchange upon filing with the Commission. 1 15 E:\FR\FM\23MRN1.SGM 23MRN1

Agencies

[Federal Register Volume 71, Number 56 (Thursday, March 23, 2006)]
[Notices]
[Pages 14766-14769]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-2857]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53518; File No. SR-Phlx-2005-93]


Self-Regulatory Organizations; Philadelphia Stock Exchange, Inc.; 
Notice of Filing of Proposed Rule Change and Amendments Nos. 1, 2, 3, 4 
and 5 Thereto To Amend Its By-Laws and Charter in Connection With a 
Restructuring of Its Board of Governors

March 20, 2006.
    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 30, 2005, 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 and 
II below, which items have been prepared by the Phlx. On February 16, 
2006, the Exchange filed Amendment No. 1 to the proposed rule change; 
\3\ on March 10, 2006, the Exchange filed Amendment No. 2 to the 
proposed rule change; \4\ on March 17, 2006, the Exchange filed 
Amendment No. 3 to the proposed rule change; \5\ and on March 20, 2006, 
the Exchange filed Amendment Nos. 4 \6\ and 5 \7\ to the proposed rule 
change. The Commission is publishing this notice to solicit comments on 
the proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, the Phlx revised the proposed 
definitions of the terms ``Independent'' and ``Material 
Relationship'' that are to be included in the Exchange's By-Laws and 
made clarifying changes to the purpose section and to the rule text 
of the proposed rule change.
    \4\ In Amendment No. 2, the Phlx incorporated the proposed 
definition of ``Independent Governor'' in the Exchange's Restated 
Certificate of Incorporation (``Charter''); incorporated the 
definition of ``Annual Independence Review'' in the Exchange's By-
Laws; revised the rule text to clarify the standards to be applied 
by the Nominating, Elections and Governance Committee in evaluating 
nominees for Independent Governor; described in the purpose section 
of the proposed rule change the selection criteria for the position 
of Vice-Chairman; and made clarifying changes to the rule text.
    \5\ In Amendment No. 3, the Phlx revised the purpose section and 
the rule text of the proposed rule change to set forth that the 
Nominating, Elections and Governance Committee shall be composed of 
five persons as follows: Three Independent Governors (one of whom 
must be a Designated Independent Governor), one Stockholder 
Governor, and one Member Governor.
    \6\ In Amendment No. 4, the Phlx deleted revisions, as proposed 
in the original filing, that would have capitalized the term 
``member'' in various Charter provisions and reinstated in the 
Charter a reference to ``member (as such term is defined in the 
Exchange Act).''
    \7\ In Amendment No. 5, the Phlx revised the statutory basis 
section of the proposed rule change.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its By-Laws and Charter to revise 
the current structure of the Phlx Board of Governors (``Board''). 
Specifically, the Exchange proposes to: (i) Voluntarily conform to 
certain aspects of the Commission's proposed SRO Governance Rulemaking, 
including the incorporation of the concept of ``independent 
directors;'' \8\ (ii) create a single Vice-Chairman of the Board; (iii) 
eliminate the distinction between On-Floor and Off-Floor Governors; 
(iv) make changes to the election of Governors in the By-Laws and 
Charter; and (v) make other modifications, including revising the 
composition of various Phlx standing committees. The text of the 
proposed rule change, as amended, is available at the Commission's 
Public Reference Room, at the Exchange's Web site (https://www.phlx.com) 
and at the Exchange's principal office.
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    \8\ See Securities Exchange Act Release No. 50669 (November 18, 
2004), 69 FR 71126 (December 8, 2004) (``Proposed SRO Governance 
Rulemaking'').

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[[Page 14767]]

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 Phlx included statements 
concerning the purpose of, and basis for, the proposed rule change, as 
amended, 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 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 address various 
governance issues in both the Exchange's By-Laws and Charter.

Conformance to Certain Aspects of the Proposed SRO Governance 
Rulemaking

    One purpose of the proposed rule change is to amend the Exchange's 
By-Laws and Charter to voluntarily conform to certain aspects of the 
Proposed SRO Governance Rulemaking, including the concept of 
``independent directors'' as set forth in the proposed rulemaking.\9\ 
The Exchange proposes to convert all non-industry \10\ positions to 
independent positions and to add an additional Independent Governor to 
ensure a majority of Independent Governors in accordance with the 
Proposed SRO Governance Rulemaking.\11\ An Independent Governor would 
be defined as a Governor who has no material relationship with the 
Exchange or any affiliate of the Exchange, any member of the Exchange 
or any affiliate of such member, or any issuer of securities that are 
listed or traded on the Exchange or a facility of the Exchange. A 
material relationship would be defined as a relationship, compensatory 
or otherwise, that reasonably could affect the independent judgment or 
decision-making of a Governor. The Board would make this independence 
determination upon a Governor's nomination and no less frequently than 
annually and as often as necessary in light of a Governor's 
circumstances and pursuant to Article IV, Section 4-4 of the Phlx By-
Laws to ensure that the status of all incumbent Independent Governors 
do not fall outside the definition of Independent.\12\ The designation 
of ``Independent'' would replace the defined terms ``public'' \13\ and 
``non-industry,'' as presently set forth in the Phlx's By-Laws and 
Charter. Currently, the Board consists of 22 Governors.\14\ Under this 
proposal, the Board would consist of 23 Governors. Accordingly, the 
Board would consist of a majority of Independent Governors.
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    \9\ See id.
    \10\ Currently, ``non-industry'' is defined as follows: The term 
non-industry when used in the context of Governors or committee 
members shall mean (a) public Governors; (b) officers and employees 
of issuers of securities listed on the Exchange; (c) persons 
affiliated with brokers and dealers that operate solely to assist 
the securities-related activities of the business of non-member 
affiliates (such as brokers or dealers established to (i) distribute 
an affiliate's securities which are issued on a continuous or 
regular basis, or (ii) process the limited buy and sell orders of 
the shares of employee owners of the affiliate); (d) employees of an 
entity that is affiliated with a broker or dealer that does not 
account for a material portion of the revenues of the consolidated 
entity, and who are primarily engaged in the business of the non-
member entity; and (e) other individuals who would not be industry 
Governors or committee members. Phlx By-Laws Article I, Section 1-
1(t).
    \11\ See supra at note 8.
    \12\ ``Independent'' would be defined in the Phlx By-Laws, 
Article 1, Section 1-1(o) as follows: The term ``Independent,'' when 
used in the context of Governor or Committee Members, shall mean 
persons affirmatively determined by the Board as having no Material 
Relationship with the Exchange or any affiliate of the Exchange, any 
member of the Exchange or any affiliate of such member, or any 
issuer of securities that are listed or traded on the Exchange or a 
facility of the Exchange.
    \13\ ``Public'' is defined in the Phlx By-Laws Article I, 
Section 1-1(y) as follows: The term ``public'' when used in the 
context of Governors or committee members shall mean non-industry 
persons who have no material business relationship with a broker, 
dealer or the Exchange.'' The proposed rule change would delete the 
definition of ``public'' from the Phlx By-Laws.
    \14\ See Phlx Charter Article Seventh, and Phlx By-Laws Article 
IV, Section 4-1.
---------------------------------------------------------------------------

Single Vice-Chairman

    The Phlx proposes to amend its By-Laws and Charter to create, in 
proposed Phlx By-Laws Article V, Section 5-2, a single Vice-Chairman of 
the Board who would be recommended by the Chairman for nomination by 
the Nominating, Elections and Governance Committee and elected by the 
stockholders. The Vice-Chairman would not be subject to a term limit. 
The Vice-Chairman would be an individual who, anytime within the prior 
three years, has been a Member primarily engaged in business on the 
Exchange's equity market or equity options market or is a general 
partner, executive officer (vice-president or above) or a Member 
associated with a Member Organization primarily engaged in business on 
the Exchange's equity market or equity options market. Currently, the 
By-Laws require two Vice-Chairmen of the Board, with one Vice-Chairman 
elected as an On-Floor Governor by the Members, and the other Vice-
Chairman elected as an Off-Floor Governor by the stockholders. The 
Exchange proposes this change to conform to a structure that is more 
typical of a for-profit stock corporation and also because the two 
Vice-Chairmen model is not sustainable if the ``On-Floor'' and ``Off-
Floor'' distinctions are eliminated, as discussed below.

Elimination of the ``On-Floor'' and ``Off-Floor'' Governor Distinction

    The Exchange proposes to eliminate the distinction between ``On-
Floor'' \15\ and ``Off-Floor'' \16\ Governors, in both its By-Laws and 
Charter, to allow for greater stockholder representation and, 
specifically, representation on the Board of the six recently acquired 
strategic investors.\17\ Presently, there are five Off-Floor Industry 
Governors elected by the stockholders and five On-Floor Industry 
Governors elected by the Members. The Exchange proposes to replace this 
current model with nine positions that would consist of six positions 
elected by stockholders, two Member positions and one Philadelphia 
Board of Trade

[[Page 14768]]

(``PBOT'') position. The Member positions and the PBOT position would 
be elected by Members of the Exchange.
---------------------------------------------------------------------------

    \15\ Phlx By-Laws Article IV, Section 4-1 provides that an ``On-
Floor Governor'' is ``an industry Governor and is a member primarily 
engaged in business on the Exchange's Equity Floor or a general 
partner, executive officer (vice president and above) or member 
associated with a member organization primarily engaged in business 
on the Exchange's Equity Floor (On-Floor Equity Governor) * * * 
[and] is an industry Governor and is a member of the Philadelphia 
Board of Trade (On-Floor PBOT Governor) * * * [and] is an industry 
Governor and is a member primarily engaged in business as a 
specialist on the Exchange's Equity Options Floor or a general 
partner, executive officer (vice president and above) or a member 
associated with a member organization primarily engaged in 
specialist business on the Exchange's Equity Options Floor (On-Floor 
Equity Options Specialist Governor) * * * [and] is an industry 
Governor and is a member primarily engaged in business as a 
registered options trader on the Exchange's Equity Options Floor or 
a general partner, executive officer (vice president and above) or a 
member associated with a member organization primarily engaged in 
registered options trader business on the Exchange's Equity Options 
Floor (On-Floor Equity Options Registered Options Trader Governor); 
and * * * who is an industry Governor and is a member primarily 
engaged in business on the Exchange's Equity Options Floor as a 
floor broker (On-Floor Equity Options Broker Governor).''
    \16\ Phlx By-Laws Article IV, Section 4-1 provides that ``Off-
Floor Governors'' are ``industry Governors and general partners, 
executive officers (vice president or above), or members or 
participants associated with member or participant organizations 
which conduct a non-member or non participant public customer 
business and shall individually not be primarily engaged in business 
activities on the Exchange Floor.''
    \17\ During 2005, six firms invested in the Exchange: Citigroup 
Financial Products, Inc.; Credit Suisse First Boston NEXT Fund, 
Inc.; Morgan Stanley & Co., Inc., UBS Securities LLC; Citadel 
Derivatives Group, LLC; and Merrill Lynch, Pierce Fenner & Smith, 
Inc.
---------------------------------------------------------------------------

Election of Governors

    The Exchange proposes to amend its By-Laws and Charter to reflect 
that two of the Independent Governors will be nominated and elected by 
the Members of the Exchange, as will both Member Governors and the PBOT 
Governor, in order to maintain the 20% fair representation of 
membership on the Board.\18\ The Exchange represents that the proposed 
amendments to its Charter and By-Laws, in and of themselves, would 
require minimal changes to the present composition of the Board, 
subject to a formal analysis and determination by the Board of the 
qualifications of the Independent Governors, and would be largely a 
reclassification of Board positions.
---------------------------------------------------------------------------

    \18\ See Section 6(b)(3) of the Act, 15 U.S.C. 78f(b)(3). See 
also Proposed SRO Governance Rulemaking. The Exchange states that it 
is proposing to voluntarily adopt certain concepts addressed in the 
Commission's Proposed SRO Governance Rulemaking.
---------------------------------------------------------------------------

    The Exchange would conform the composition of the Board to the 
provisions of the proposed rule change as follows: upon the approval of 
the proposed rule change by the Commission, the Exchange will hold an 
Annual Meeting of Member and Member Organizations, to be followed by 
the Annual Meeting of Stockholders to elect the class of Governors for 
2006. The class of 2006 Governors will be nominated and elected 
pursuant to the Charter and By-Laws, as proposed to be amended, with 
two of the nine Board positions being nominated and selected by the 
Members and elected by the Trustee of the Series Class A Preferred 
Stock. The classes of 2007 and 2008 Governors will be permitted to 
complete their terms but will be appointed by the Nominating, Elections 
and Governance Committee, with the approval of the Board, to fill the 
new positions established by the amendments until which time those 
positions come up for election in either 2007 and 2008 
respectively.\19\ Following the election of the class of 2006, over 20% 
of the Governors serving on the Board will have been nominated and 
elected by the Members.
---------------------------------------------------------------------------

    \19\ See Phlx By-Laws Article IV, Section 4-7.
---------------------------------------------------------------------------

Stockholder Meetings

    With regard to its Charter, the Phlx seeks to remove Article Ninth 
to allow greater flexibility in the Exchange's governance processes. In 
the absence of this Article, the issue of obtaining the written consent 
of the stockholders of the Exchange for any action in lieu of a meeting 
will be governed by Delaware General Corporation Law, which will allow 
stockholders to take actions outside of a stockholder meeting by less-
than-unanimous written consent.

Other Modifications

    To conform with the proposed changes to the Board's composition 
described above, the Exchange also proposes to amend its By-Laws and 
Charter sections relating to Board Committees as follows: \20\
---------------------------------------------------------------------------

    \20\ The Exchange notes that no changes are being made to Phlx 
By-Laws Article X, Section 10-9, its Audit Committee provision. The 
Commission recently approved a proposed rule change to amend this 
provision of the Phlx By-Laws to require, among other things, that 
the members of the Audit Committee be ``Independent Governors.'' See 
Securities Exchange Act Release No. 53356 (February 23, 2006), 71 FR 
10741 (March 2, 2006) (SR-Phlx-2004-37).
---------------------------------------------------------------------------

     The following committees are not affected by the changes 
described herein with the exception of minor technical modifications:
    [cir] Admissions
    [cir] Options Allocation, Evaluation and Securities Committee
    [cir] Equity Allocation Evaluation and Securities Committee
    [cir] Floor Procedure
    [cir] Foreign Currency Options
    [cir] Marketing
    [cir] Options
    [cir] The Automation Committee currently allows for the Chairman of 
the Committee to be designated as a Non-Industry or Off-Floor Governor. 
The proposal would change this designation to a Stockholder or 
Independent Governor.
    [cir] The Business Conduct Committee is currently composed of three 
Non-Industry Governors (one of whom must be Public); one Equity Floor 
Member; one Equity Options Floor Member; one At-Large Floor Member; and 
three Off-Floor Members. The proposal would modify the composition as 
follows: Three Independent Governors; four Members or persons 
associated with a Member Organization; one Member who primarily 
conducts business on the Equity Floor; and one Member who primarily 
conducts business on the Equity Options Floor.
    [cir] The Compensation Committee is currently composed of one 
Chairman (who must be a Non-Industry Governor); two Non-Industry 
Governors (one of whom must be a Public Governor); and the two Vice-
Chairmen of the Board. The proposal would modify the composition as 
follows: Four Independent Governors (one of whom must serve as chairman 
of the committee) and the Vice-Chairman of the Board.
    [cir] The Executive Committee is currently composed of the Chairman 
of the Board; the two Vice-Chairmen of the Board; the Chairman of the 
Finance Committee; one Chairman of a floor committee not represented by 
the On-Floor Vice-Chairman; one Chairman of a floor committee not 
represented by the Off-Floor Vice-Chairman; one Off-Floor Governor; and 
two Non-Industry Governors (one of whom must be a Public Governor). The 
proposal would modify the composition as follows: the Chairman of the 
Board; the Vice-Chairman of the Board; two Stockholder Governors; two 
Independent Governors; the Chairman of the Finance Committee; and two 
Chairmen of Floor Committees.
    [cir] The Finance Committee is currently composed as follows: the 
Chairman of the Board; the two Vice-Chairmen of the Board; one On-Floor 
Member (who may be a Governor); one Off-Floor Member (who may be a 
Governor); and four Non-Industry Governors (one whom must be a Public 
Governor). The proposal would modify the composition as follows: the 
Chairman and Vice-Chairman of the Board; two Members or persons 
associated with a Member Organization, who may be Governors (one of 
whom conducts business primarily on the Equity or Equity Options 
Floor); one Stockholder Governor; and four Independent Governors. The 
Chairman of this committee would be the Vice-Chairman of the Board, a 
Stockholder Governor or a Member Governor.
    [cir] The Nominating and Elections Committee would be renamed the 
Nominating, Elections and Governance Committee. The purpose of this 
change is to have the Committee's name more properly reflect the 
existing role and function of this Committee. No substantive changes in 
the Committee's functions are proposed. The Nominating and Elections 
Committee is currently composed of the following: The Chairman (who 
must be a Non-Industry Public Governor); three Non-Industry Governors; 
one Off-Floor Member (who may be a Governor); one On-Floor Equity 
Governor; and one On-Floor Equity Options Governor. The proposal would 
modify the composition as follows: Three Independent Governors (one of 
whom must be a Designated Independent Governor); one Stockholder 
Governor; and one Member Governor. The Nominating, Elections and 
Governance Committee would select its Chairman from among the members 
of such Committee who are Independent Governors. Constituted in this 
manner, the interests of the Members of the Exchange, by virtue of

[[Page 14769]]

the Member Governor and the Designated Independent Governor who are 
both elected by the Members, would be represented by at least 20% of 
the Committee in compliance the fair representation requirement of 
Section 6(b)(3) of the Act.\21\
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78f(b)(3).
---------------------------------------------------------------------------

    [cir] The Quality of Markets Committee would not change in any way, 
except that ``Non-Industry Governors'' would be called ``Independent 
Governors'' and ``Industry Governors'' would be called ``Stockholder 
Governors.''
    In addition, various technical modifications have been made to the 
Phlx By-Laws for purposes of consistency.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \22\ in general, and furthers the objectives of Section 
6(b)(3) of the Act \23\ in particular, in that it is designed to assure 
a fair representation of its members in the selection of its directors 
and administration of its affairs because the members will elect five 
Designated Governors, including two Designated Independent Governors, 
one PBOT Governor, and 2 Member Governors. The Exchange also believes 
that its proposal furthers the objectives of Section 6(b)(3) of the Act 
\24\ because the Nominating, Elections and Governance Committee will 
consist of three Independent Governors (one of whom must be a 
Designated Independent Governor), one Stockholder Governor, and one 
Member Governor, with the Designated Independent Governor elected by 
the Members, ensuring greater Member representation.
---------------------------------------------------------------------------

    \22\ 15 U.S.C. 78f(b).
    \23\ 15 U.S.C. 78f(b)(3).
    \24\ 15 U.S.C. 78f(b)(3).
---------------------------------------------------------------------------

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 either solicited or received by the 
Exchange.

III. Date of Effectiveness of the Proposed Rule

    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.
    The Phlx has requested accelerated approval of the proposed rule 
change. While the Commission will not grant accelerated approval at 
this time, the Commission will consider granting accelerated approval 
of the proposal at the close of the comment period, 21 days from the 
date of publication of the proposal in the Federal Register.

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 No. SR-Phlx-2005-93 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-Phlx-2005-93. 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 Commissions 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 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. 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-2005-93 and should be submitted by April 13, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\25\
---------------------------------------------------------------------------

    \25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
[FR Doc. 06-2857 Filed 3-21-06; 11:52 am]
BILLING CODE 8010-01-P
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