Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval of a Proposed Rule Change and Amendment Nos. 1 and 2 To Amend Exchange Delisting Rules To Conform to Recent Amendments to Commission Rules Regarding Removal From Listing and Withdrawal From Registration, 21056-21058 [E6-6078]

Download as PDF 21056 Federal Register / Vol. 71, No. 78 / Monday, April 24, 2006 / Notices that the financial viability exception has been granted, and the securities have been approved for listing. In addition, the Exchange proposes to require a company that receives the financial viability exception to issue a press release ten days before issuance of the subject securities, in addition to the notice to shareholders that is currently required by Exchange rules. Further, the Exchange proposes to update its disclosure policies by amending sections 402 and 1009 of the Amex Company Guide and to make minor, technical changes to section 401 of the Amex Company Guide. III. Discussion rmajette on PROD1PC67 with NOTICES After careful consideration of the amended proposal and consideration of the comment letters, 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 4 and, in particular, the requirements of section 6 of the Act.5 Specifically, as discussed in detail below, the Commission finds that the proposed rule change is consistent with section 6(b)(5) of the Act,6 which requires, among other things, that the rules of a national securities exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, and processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. Section 6(b)(5) of the Act 7 also requires that the rules of an exchange not be designed to permit unfair discrimination among customers, issuers, brokers, or dealers. The Commission believes that the proposal to set forth the factors used by the Exchange in evaluating the regulatory conduct and corporate governance of a company clarifies the Exchange rules and provides greater transparency to listed companies and applicants about the criteria and evaluation methods that the Exchange employs in its broad discretionary 4 In approving this proposed rule change, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 5 15 U.S.C. 78f. 6 15 U.S.C. 78f(b)(5). 7 Id. VerDate Aug<31>2005 14:56 Apr 21, 2006 Jkt 208001 authority to deny initial or continued listing to a company.8 The Commission believes that the proposal to update the Exchange’s disclosure policies may provide increased investor protection by conforming the disclosure time frames with existing federal securities laws and requiring increased disclosure, such as when the company relies on the financial viability exception or when it receives a Warning Letter or a Deficiency Letter. The Commission also believes that the proposal to amend shareholder approval requirements may provide increased investor protection by requiring companies, when relying on the financial viability exception, to obtain the approval of independent and disinterested directors and to prohibit the issuance or registration of the securities subject to shareholder approval until companies have received written approval confirmation from the Exchange. IV. Conclusion It is therefore ordered, pursuant to section 19(b)(2) of the Act,9 that the proposed rule change (SR–Amex–2006– 04) is approved. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.10 Nancy M. Morris, Secretary. [FR Doc. E6–6040 Filed 4–21–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53666; File No. SR–Amex– 2005–107] Self-Regulatory Organizations; American Stock Exchange LLC; Order Granting Approval of a Proposed Rule Change and Amendment Nos. 1 and 2 To Amend Exchange Delisting Rules To Conform to Recent Amendments to Commission Rules Regarding Removal From Listing and Withdrawal From Registration ‘‘Exchange’’) 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 Exchange delisting rules to conform to recent amendments to Commission rules regarding removal from listing and withdrawal from registration. On October 27, 2005, Amex filed Amendment No. 1 to the proposed rule change.3 On February 1, 2006, Amex filed Amendment No. 2 to the proposed rule change.4 The proposed rule change, as amended, was published for comment in the Federal Register on March 13, 2006.5 No comments were received regarding the proposal. This order approves the proposed rule change, as amended. II. Description of the Proposed Rule Change Section 12 of the Act 6 and Rule 12d2–2 thereunder 7 (‘‘SEC Rule 12d2– 2’’) govern the process for the delisting and deregistration of securities listed on national securities exchanges. Recent amendments to SEC Rule 12d2–2 (‘‘amended SEC Rule 12d2–2’’) and other Commission rules require the electronic filing of revised Form 25 on the Commission’s Electronic Data Gathering, Analysis, and Retrieval (‘‘EDGAR’’) system by exchanges and issuers for all delistings, other than delistings of standardized options and securities futures, which are exempted.8 The Amex proposes to revise Amex Rule 18 and sections 1010, 1011, 1201, 1202, 1203, 1204, 1205 and 1206 of the Amex Company Guide with respect to delisting procedural requirements as mandated by recent amendments to SEC Rule 12d2–2. In the case of exchange-initiated delistings, amended SEC Rule 12d2–2(b) states that a national securities exchange may file an application on Form 25 to strike a class of securities from listing and/or withdraw the registration of such securities, in accordance with its rules, 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Amendment No. 1 replaced the original proposed rule change in its entirety. 4 In Amendment No. 2, Amex added footnotes to the Form 19b–4 and Exhibit 1 that reference appropriate sections of the Amex Company Guide; made grammatical corrections to the proposed rule text regarding the final effective date of the old Amex rules; and clarified the circumstances under which the Exchange is authorized to file a Form 25 for certain corporate actions. 5 See Securities Exchange Act Release No. 53398 (March 2, 2006), 71 FR 12738. 6 15 U.S.C. 78l. 7 17 CFR 240.12d2–2. 8 See Securities Exchange Act Release No. 52029 (July 14, 2005), 70 FR 42456 (July 22, 2005). 2 17 April 17, 2006. I. Introduction On October 24, 2005, the American Stock Exchange LLC (‘‘Amex’’ or 8 The Commission notes that this proposed rule change is substantially similar to a proposal submitted by the National Association of Securities Dealers, Inc. and approved by the Commission. See Securities Exchange Act Release No. 52342 (August 26, 2005), 70 FR 52456 (September 2, 2005) (SR– NASD–2004–125). 9 15 U.S.C. 78s(b)(2). 10 17 CFR 200.30–3(a)(12). PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\24APN1.SGM 24APN1 Federal Register / Vol. 71, No. 78 / Monday, April 24, 2006 / Notices rmajette on PROD1PC67 with NOTICES if the rules of such exchange, at a minimum, provide for: 9 (i) Notice to the issuer of the exchange’s decision to delist its securities; (ii) An opportunity for appeal to the exchange’s board of directors, or to a committee designated by the board; and (iii) Public notice of the national securities exchange’s final determination to remove the security from listing and/or registration, by issuing a press release and posting notice on its Web site. Public notice must be disseminated no fewer than 10 days before the delisting becomes effective pursuant to amended SEC Rule 12d2–2(d)(1), and must remain posted on its Web site until the delisting is effective. With respect to the above requirements set forth in amended SEC Rule 12d2–2(b), Amex rules currently provide the requisite issuer notice as well as an opportunity for appeal to a committee designated by the Board.10 Amex rules do not currently provide for the mandated public notice, and accordingly the Amex is proposing changes to section 1010(c) of the Amex Company Guide to incorporate such public notice as required by the recent amendments to SEC Rule 12d2–2(b). The proposed changes do not impact the Amex’s existing authority to suspend trading in an issuer’s securities following an adverse panel decision but prior to the filing of a delisting application and/or effective date of a delisting. In the case of an issuer-initiated delisting, Amex proposes revisions to Amex Rule 18 and section 1010 of the Amex Company Guide, as mandated, to require the issuer to: (i) Comply with the Exchange’s rules for delisting and applicable state laws; (ii) Submit written notice to the Exchange, no fewer than ten days before filing a Form 25, of its intent to withdraw its security, which notice includes a statement of all material facts relating to the reasons for filing the application (effectively, this notice to the Exchange will be provided at least 20 days before the delisting becomes effective); and (iii) Issue public notice of its intent to delist via a press release, and, if it has a publicly available Web site, by posting the notice on that Web site, contemporaneously with providing written notice to the exchange and keeping it posted until the delisting is effective. In addition, changes are proposed to Amex Rule 18 to require that the board of directors (or comparable governing body) of an issuer initiating the delisting of its securities must approve the decision to delist, and that the issuer provide the Exchange with a certified copy of the relevant board resolution prior to filing the Form 25. The issuer must notify the Exchange that it has filed Form 25 with the Commission contemporaneously with such filing. The Amex also proposes that an issuer seeking to voluntarily apply to withdraw a class of securities from listing on the Exchange that has received notice from the Exchange that it is below the Exchange’s continued listing policies and standards, or that is aware that it is below such continued listing policies and standards notwithstanding that it has not received such notice from the Exchange, must disclose that it is no longer eligible for continued listing (including the specific continued listing policies and standards that the issue is below) in: (i) Its statement of all material facts relating to the reasons for withdrawal from listing provided to the Exchange along with written notice of its determination to withdraw from listing required by amended SEC Rule 12d2–2(c)(2)(ii) and; (ii) its public press release and Web site notice required by amended SEC Rule 12d2–2(c)(2)(iii). Further, as required by amended SEC Rule 12d2–2(c)(3), the Amex represents that it will post notice of issuer-initiated delistings on its Web site beginning on the business day following receipt of notice from the issuer, and it will keep the notice posted until the delisting becomes effective. As in the case of an exchange-initiated delisting, the Amex will retain the ability to suspend trading in an issuer’s securities, in order to accommodate its transfer to another marketplace, prior to the effective date of the delisting. Finally, Amex has made changes in its rules to clarify that the Form 25 serves as the application to remove a security from listing and/or registration and to specify that the proposed changes will be effective as of April 24, 2006 as required by amended SEC Rule 12d2–2. 9 See also Form 8–K (Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing), which sets forth disclosure requirements for issuers that do not satisfy listing standards. 10 See Amex Company Guide, Section 1202 (Written Notice of Staff Determination) and section 1203 (Request for Hearing). III. Discussion 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 VerDate Aug<31>2005 14:56 Apr 21, 2006 Jkt 208001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 21057 exchange 11 and, in particular, the requirements of section 6 of the Act.12 Specifically, as discussed below, the Commission finds that the proposal is consistent with section 6(b)(5) of the Act,13 which requires, in part, that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, and processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. Further, as noted in more detail below, the changes being adopted by Amex meet the requirements of amended SEC Rule 12d2–2. A. Exchange Delisting Amended SEC Rule 12d2–2(b) states that a national securities exchange may file an application on Form 25 to strike a class of securities from listing and/or withdraw the registration of such securities, in accordance with its rules, if the rules of such exchange, at a minimum, provide for notice to the issuer of the exchange’s decision to delist, opportunity for appeal, and public notice of the exchange’s final determination to delist. The Commission believes that Amex’s current rules and proposal comply with the dictates of amended SEC Rule 12d2– 2(b). Amex rules currently provide the requisite issuer notice as well as an opportunity for appeal to a committee designated by the Board.14 Specifically, issuers may appeal staff delisting determinations to panel of at least two members of the Committee on Securities, which is a board-appointed committee.15 Adverse panel decisions may be appealed to the Committee on Securities.16 In addition, the Board may in its discretion call any Committee on Securities decision for review.17 In addition, the proposed rule change will provide for public notice of the Exchange’s final determination to 11 In approving this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 12 15 U.S.C. 78f. 13 15 U.S.C. 78f(b)(5). 14 See supra note 10. 15 See Amex Company Guide, section 1204 (The Listing Qualifications Panel). 16 See Amex Company Guide, section 1205 (Review by the Amex Committee on Securities). 17 See Amex Company Guide, section 1206 (Discretionary Review by Amex Board). E:\FR\FM\24APN1.SGM 24APN1 21058 Federal Register / Vol. 71, No. 78 / Monday, April 24, 2006 / Notices rmajette on PROD1PC67 with NOTICES remove the security from listing and/or registration. The Commission notes that the proposed changes do not impact the Amex’s existing authority to suspend trading in an issuer’s securities following an adverse panel decision but prior to the filing of a delisting application and/or effective date of a delisting. B. Issuer Voluntary Delisting In the case of an issuer-initiated delisting, Amex is proposing revisions to Amex Rule 18 and section 1010 of the Amex Company Guide, as mandated, to require the issuer to: (i) Comply with the Exchange’s rules for delisting and applicable state laws; (ii) Submit written notice to the Exchange, no fewer than ten days before filing a Form 25, of its intent to withdraw its security, which notice includes a statement of all material facts relating to the reasons for filing the application (effectively, this notice to the Exchange will be provided at least 20 days before the delisting becomes effective); and (iii) Issue public notice of its intent to delist via a press release, and, if it has a publicly available Web site, by posting the notice on that Web site, contemporaneously with providing written notice to the exchange and keeping it posted until the delisting is effective. The Commission believes that the amendments will fully inform issuers of the requirements for voluntary delisting of their securities under Amex rules and federal securities laws. The proposal also sets forth a new requirement not in amended SEC Rule 12d2–2 that would require the issuer to notify the Exchange that it has filed Form 25 with the Commission contemporaneously with such filing. This requirement will allow the Exchange to be fully informed of the actual filing of a Form 25 and prepare to take timely action in accordance with the filing of the Form. In addition, Amex has proposed a new requirement that the board of directors (or comparable governing body) of an issuer initiating the delisting of its securities must approve the decision to delist and that the issuer provide the Exchange with a certified copy of the relevant board resolution. The Commission believes that these requirements may help ensure that the decision to delist a security voluntarily has been well-considered by the issuer’s board. Amex also proposes that an issuer seeking to voluntarily apply to withdraw a class of securities from listing on the Exchange that has VerDate Aug<31>2005 14:56 Apr 21, 2006 Jkt 208001 received notice from the Exchange that it is below the Exchange’s continued listing policies and standards, or that is aware that it is below such continued listing policies and standards notwithstanding that it has not received such notice from the Exchange, must disclose that it is no longer eligible for continued listing (including the specific continued listing policies and standards that the issue is below) in: (i) Its statement of all material facts relating to the reasons for withdrawal from listing provided to the Exchange along with written notice of its determination to withdraw from listing required by amended SEC Rule 12d2–2(c)(2)(ii) and; (ii) its public press release and Web site notice required by amended SEC Rule 12d2–2(c)(2)(iii). The Commission believes that this requirement will allow shareholders to be informed and aware that the issuer has failed to meet Exchange listing standards and is voluntarily delisting. Issuers will therefore not be permitted to delist voluntarily without public disclosure of their noncompliance with Exchange listing standards. The Commission notes that Amex represents that it will, as required by the revised Commission rules, post notice of issuer-initiated delistings on its Web site beginning on the business day following receipt of notice from the issuer, and it will keep the notice posted until the delisting becomes effective. The Commission also notes that, as in the case of an exchange-initiated delisting, the Amex will retain the ability to suspend trading in an issuer’s securities, in order to accommodate its transfer to another marketplace, prior to the effective date of the delisting. IV. Conclusion It is therefore ordered, pursuant to section 19(b)(2) of the Act,18 that the proposed rule change (File No. SR– Amex–2005–107), as amended, is approved. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.19 Nancy M. Morris, Secretary. [FR Doc. E6–6078 Filed 4–21–06; 8:45 am] BILLING CODE 8010–01–P 18 Id. 19 17 PO 00000 CFR 200.30–3(a)(12). Frm 00090 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–53665; File No. SR–CBOE– 2005–87] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Approval of a Proposed Rule Change and Amendment Nos. 1 and 2 To Amend Exchange Delisting Rules to Conform to Recent Amendments to Commission Rules Regarding Removal From Listing and Withdrawal From Registration April 17, 2006. I. Introduction On October 21, 2005, the Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’ or ‘‘SEC’’), 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 Exchange delisting rules to conform to recent amendments to Commission rules regarding removal from listing and withdrawal from registration. On December 14, 2005, CBOE filed Amendment No. 1 to the proposed rule change.3 On February 24, 2006, CBOE filed Amendment No. 2 to the proposed rule change.4 The proposed rule change, as amended, was published for comment in the Federal Register on March 13, 2006.5 No comments were received regarding the proposal. This order approves the proposed rule change, as amended. II. Description of the Proposed Rule Change Section 12 of the Act 6 and SEC Rule 12d2–2 govern the process for the delisting and deregistration of securities listed on national securities exchanges. Recent amendments to SEC Rule 12d2– 2 (‘‘amended SEC Rule 12d2–2’’) and 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Amendment No. 1 replaced the original proposed rule change in its entirety. 4 In Amendment No. 2, CBOE amended CBOE Rule 31.94(G)(h) to state that in appropriate circumstances, when the Exchange is considering delisting because a company no longer meets the requirements for continued listing, a company may, with the consent of the Exchange, file a Form 25 with the SEC, provided that it follows the requirements set forth in SEC Rule 12d2–2(c) and discloses that it is no longer eligible for continued listing on the Exchange in its written notice to the Exchange and public press release, and if it has a publicly accessible Web site, posts such notice on that Web site. 5 See Securities Exchange Act Release No. 53399 (March 2, 2006), 71 FR 12749. 6 15 U.S.C. 78l. 2 17 E:\FR\FM\24APN1.SGM 24APN1

Agencies

[Federal Register Volume 71, Number 78 (Monday, April 24, 2006)]
[Notices]
[Pages 21056-21058]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-6078]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53666; File No. SR-Amex-2005-107]


Self-Regulatory Organizations; American Stock Exchange LLC; Order 
Granting Approval of a Proposed Rule Change and Amendment Nos. 1 and 2 
To Amend Exchange Delisting Rules To Conform to Recent Amendments to 
Commission Rules Regarding Removal From Listing and Withdrawal From 
Registration

April 17, 2006.

I. Introduction

    On October 24, 2005, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') 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 Exchange delisting rules to conform to 
recent amendments to Commission rules regarding removal from listing 
and withdrawal from registration. On October 27, 2005, Amex filed 
Amendment No. 1 to the proposed rule change.\3\ On February 1, 2006, 
Amex filed Amendment No. 2 to the proposed rule change.\4\ The proposed 
rule change, as amended, was published for comment in the Federal 
Register on March 13, 2006.\5\ No comments were received regarding the 
proposal. This order approves the proposed rule change, as amended.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 replaced the original proposed rule change 
in its entirety.
    \4\ In Amendment No. 2, Amex added footnotes to the Form 19b-4 
and Exhibit 1 that reference appropriate sections of the Amex 
Company Guide; made grammatical corrections to the proposed rule 
text regarding the final effective date of the old Amex rules; and 
clarified the circumstances under which the Exchange is authorized 
to file a Form 25 for certain corporate actions.
    \5\ See Securities Exchange Act Release No. 53398 (March 2, 
2006), 71 FR 12738.
---------------------------------------------------------------------------

II. Description of the Proposed Rule Change

    Section 12 of the Act \6\ and Rule 12d2-2 thereunder \7\ (``SEC 
Rule 12d2-2'') govern the process for the delisting and deregistration 
of securities listed on national securities exchanges. Recent 
amendments to SEC Rule 12d2-2 (``amended SEC Rule 12d2-2'') and other 
Commission rules require the electronic filing of revised Form 25 on 
the Commission's Electronic Data Gathering, Analysis, and Retrieval 
(``EDGAR'') system by exchanges and issuers for all delistings, other 
than delistings of standardized options and securities futures, which 
are exempted.\8\
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78l.
    \7\ 17 CFR 240.12d2-2.
    \8\ See Securities Exchange Act Release No. 52029 (July 14, 
2005), 70 FR 42456 (July 22, 2005).
---------------------------------------------------------------------------

    The Amex proposes to revise Amex Rule 18 and sections 1010, 1011, 
1201, 1202, 1203, 1204, 1205 and 1206 of the Amex Company Guide with 
respect to delisting procedural requirements as mandated by recent 
amendments to SEC Rule 12d2-2.
    In the case of exchange-initiated delistings, amended SEC Rule 
12d2-2(b) states that a national securities exchange may file an 
application on Form 25 to strike a class of securities from listing 
and/or withdraw the registration of such securities, in accordance with 
its rules,

[[Page 21057]]

if the rules of such exchange, at a minimum, provide for: \9\
---------------------------------------------------------------------------

    \9\ See also Form 8-K (Item 3.01. Notice of Delisting or Failure 
to Satisfy a Continued Listing Rule or Standard; Transfer of 
Listing), which sets forth disclosure requirements for issuers that 
do not satisfy listing standards.
---------------------------------------------------------------------------

    (i) Notice to the issuer of the exchange's decision to delist its 
securities;
    (ii) An opportunity for appeal to the exchange's board of 
directors, or to a committee designated by the board; and
    (iii) Public notice of the national securities exchange's final 
determination to remove the security from listing and/or registration, 
by issuing a press release and posting notice on its Web site. Public 
notice must be disseminated no fewer than 10 days before the delisting 
becomes effective pursuant to amended SEC Rule 12d2-2(d)(1), and must 
remain posted on its Web site until the delisting is effective.
    With respect to the above requirements set forth in amended SEC 
Rule 12d2-2(b), Amex rules currently provide the requisite issuer 
notice as well as an opportunity for appeal to a committee designated 
by the Board.\10\ Amex rules do not currently provide for the mandated 
public notice, and accordingly the Amex is proposing changes to section 
1010(c) of the Amex Company Guide to incorporate such public notice as 
required by the recent amendments to SEC Rule 12d2-2(b). The proposed 
changes do not impact the Amex's existing authority to suspend trading 
in an issuer's securities following an adverse panel decision but prior 
to the filing of a delisting application and/or effective date of a 
delisting.
---------------------------------------------------------------------------

    \10\ See Amex Company Guide, Section 1202 (Written Notice of 
Staff Determination) and section 1203 (Request for Hearing).
---------------------------------------------------------------------------

    In the case of an issuer-initiated delisting, Amex proposes 
revisions to Amex Rule 18 and section 1010 of the Amex Company Guide, 
as mandated, to require the issuer to:
    (i) Comply with the Exchange's rules for delisting and applicable 
state laws;
    (ii) Submit written notice to the Exchange, no fewer than ten days 
before filing a Form 25, of its intent to withdraw its security, which 
notice includes a statement of all material facts relating to the 
reasons for filing the application (effectively, this notice to the 
Exchange will be provided at least 20 days before the delisting becomes 
effective); and
    (iii) Issue public notice of its intent to delist via a press 
release, and, if it has a publicly available Web site, by posting the 
notice on that Web site, contemporaneously with providing written 
notice to the exchange and keeping it posted until the delisting is 
effective.
    In addition, changes are proposed to Amex Rule 18 to require that 
the board of directors (or comparable governing body) of an issuer 
initiating the delisting of its securities must approve the decision to 
delist, and that the issuer provide the Exchange with a certified copy 
of the relevant board resolution prior to filing the Form 25. The 
issuer must notify the Exchange that it has filed Form 25 with the 
Commission contemporaneously with such filing.
    The Amex also proposes that an issuer seeking to voluntarily apply 
to withdraw a class of securities from listing on the Exchange that has 
received notice from the Exchange that it is below the Exchange's 
continued listing policies and standards, or that is aware that it is 
below such continued listing policies and standards notwithstanding 
that it has not received such notice from the Exchange, must disclose 
that it is no longer eligible for continued listing (including the 
specific continued listing policies and standards that the issue is 
below) in: (i) Its statement of all material facts relating to the 
reasons for withdrawal from listing provided to the Exchange along with 
written notice of its determination to withdraw from listing required 
by amended SEC Rule 12d2-2(c)(2)(ii) and; (ii) its public press release 
and Web site notice required by amended SEC Rule 12d2-2(c)(2)(iii).
    Further, as required by amended SEC Rule 12d2-2(c)(3), the Amex 
represents that it will post notice of issuer-initiated delistings on 
its Web site beginning on the business day following receipt of notice 
from the issuer, and it will keep the notice posted until the delisting 
becomes effective. As in the case of an exchange-initiated delisting, 
the Amex will retain the ability to suspend trading in an issuer's 
securities, in order to accommodate its transfer to another 
marketplace, prior to the effective date of the delisting.
    Finally, Amex has made changes in its rules to clarify that the 
Form 25 serves as the application to remove a security from listing 
and/or registration and to specify that the proposed changes will be 
effective as of April 24, 2006 as required by amended SEC Rule 12d2-2.

III. Discussion

    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 exchange \11\ and, in 
particular, the requirements of section 6 of the Act.\12\ Specifically, 
as discussed below, the Commission finds that the proposal is 
consistent with section 6(b)(5) of the Act,\13\ which requires, in 
part, that the rules of an exchange be designed to prevent fraudulent 
and manipulative acts and practices, to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in regulating, clearing, settling, and processing 
information with respect to, and facilitating transactions in 
securities, to remove impediments to and perfect the mechanism of a 
free and open market and a national market system, and, in general, to 
protect investors and the public interest. Further, as noted in more 
detail below, the changes being adopted by Amex meet the requirements 
of amended SEC Rule 12d2-2.
---------------------------------------------------------------------------

    \11\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. See 15 U.S.C. 78c(f).
    \12\ 15 U.S.C. 78f.
    \13\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

A. Exchange Delisting

    Amended SEC Rule 12d2-2(b) states that a national securities 
exchange may file an application on Form 25 to strike a class of 
securities from listing and/or withdraw the registration of such 
securities, in accordance with its rules, if the rules of such 
exchange, at a minimum, provide for notice to the issuer of the 
exchange's decision to delist, opportunity for appeal, and public 
notice of the exchange's final determination to delist. The Commission 
believes that Amex's current rules and proposal comply with the 
dictates of amended SEC Rule 12d2-2(b).
    Amex rules currently provide the requisite issuer notice as well as 
an opportunity for appeal to a committee designated by the Board.\14\ 
Specifically, issuers may appeal staff delisting determinations to 
panel of at least two members of the Committee on Securities, which is 
a board-appointed committee.\15\ Adverse panel decisions may be 
appealed to the Committee on Securities.\16\ In addition, the Board may 
in its discretion call any Committee on Securities decision for 
review.\17\ In addition, the proposed rule change will provide for 
public notice of the Exchange's final determination to

[[Page 21058]]

remove the security from listing and/or registration. The Commission 
notes that the proposed changes do not impact the Amex's existing 
authority to suspend trading in an issuer's securities following an 
adverse panel decision but prior to the filing of a delisting 
application and/or effective date of a delisting.
---------------------------------------------------------------------------

    \14\ See supra note 10.
    \15\ See Amex Company Guide, section 1204 (The Listing 
Qualifications Panel).
    \16\ See Amex Company Guide, section 1205 (Review by the Amex 
Committee on Securities).
    \17\ See Amex Company Guide, section 1206 (Discretionary Review 
by Amex Board).
---------------------------------------------------------------------------

B. Issuer Voluntary Delisting

    In the case of an issuer-initiated delisting, Amex is proposing 
revisions to Amex Rule 18 and section 1010 of the Amex Company Guide, 
as mandated, to require the issuer to:
    (i) Comply with the Exchange's rules for delisting and applicable 
state laws;
    (ii) Submit written notice to the Exchange, no fewer than ten days 
before filing a Form 25, of its intent to withdraw its security, which 
notice includes a statement of all material facts relating to the 
reasons for filing the application (effectively, this notice to the 
Exchange will be provided at least 20 days before the delisting becomes 
effective); and
    (iii) Issue public notice of its intent to delist via a press 
release, and, if it has a publicly available Web site, by posting the 
notice on that Web site, contemporaneously with providing written 
notice to the exchange and keeping it posted until the delisting is 
effective.
    The Commission believes that the amendments will fully inform 
issuers of the requirements for voluntary delisting of their securities 
under Amex rules and federal securities laws.
    The proposal also sets forth a new requirement not in amended SEC 
Rule 12d2-2 that would require the issuer to notify the Exchange that 
it has filed Form 25 with the Commission contemporaneously with such 
filing. This requirement will allow the Exchange to be fully informed 
of the actual filing of a Form 25 and prepare to take timely action in 
accordance with the filing of the Form.
    In addition, Amex has proposed a new requirement that the board of 
directors (or comparable governing body) of an issuer initiating the 
delisting of its securities must approve the decision to delist and 
that the issuer provide the Exchange with a certified copy of the 
relevant board resolution. The Commission believes that these 
requirements may help ensure that the decision to delist a security 
voluntarily has been well-considered by the issuer's board.
    Amex also proposes that an issuer seeking to voluntarily apply to 
withdraw a class of securities from listing on the Exchange that has 
received notice from the Exchange that it is below the Exchange's 
continued listing policies and standards, or that is aware that it is 
below such continued listing policies and standards notwithstanding 
that it has not received such notice from the Exchange, must disclose 
that it is no longer eligible for continued listing (including the 
specific continued listing policies and standards that the issue is 
below) in: (i) Its statement of all material facts relating to the 
reasons for withdrawal from listing provided to the Exchange along with 
written notice of its determination to withdraw from listing required 
by amended SEC Rule 12d2-2(c)(2)(ii) and; (ii) its public press release 
and Web site notice required by amended SEC Rule 12d2-2(c)(2)(iii). The 
Commission believes that this requirement will allow shareholders to be 
informed and aware that the issuer has failed to meet Exchange listing 
standards and is voluntarily delisting. Issuers will therefore not be 
permitted to delist voluntarily without public disclosure of their 
noncompliance with Exchange listing standards.
    The Commission notes that Amex represents that it will, as required 
by the revised Commission rules, post notice of issuer-initiated 
delistings on its Web site beginning on the business day following 
receipt of notice from the issuer, and it will keep the notice posted 
until the delisting becomes effective. The Commission also notes that, 
as in the case of an exchange-initiated delisting, the Amex will retain 
the ability to suspend trading in an issuer's securities, in order to 
accommodate its transfer to another marketplace, prior to the effective 
date of the delisting.

IV. Conclusion

    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\18\ that the proposed rule change (File No. SR-Amex-2005-107), as 
amended, is approved. 
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    \18\ Id.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-6078 Filed 4-21-06; 8:45 am]
BILLING CODE 8010-01-P