Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Exchange's Financial Listing Criteria, 30009-30011 [E6-7914]
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Federal Register / Vol. 71, No. 100 / Wednesday, May 24, 2006 / Notices
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 Exchange. All
comments received will be posted
without change; the Commission does
not edit personal identifying
information from submissions. You
should submit only information that
you wish to make available publicly. All
submissions should refer to File
Number SR-CBOE–2006–46 and should
be submitted on or before June 14, 2006.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.12
Nancy M. Morris,
Secretary.
[FR Doc. E6–7918 Filed 5–23–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–53825; File No. SR–NYSE–
2006–38]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Relating to the
Exchange’s Financial Listing Criteria
May 17, 2006.
jlentini on PROD1PC65 with NOTICES
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 May 16,
2006, the New York Stock Exchange
LLC (‘‘NYSE’’ or ‘‘Exchange’’), filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the Exchange. NYSE
has filed this proposal pursuant to
Section 19(b)(3)(A) of the Act 3 and Rule
19b–4(f)(6) thereunder,4 which renders
the proposal effective upon filing with
the Commission. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6).
1 15
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17:08 May 23, 2006
Jkt 208001
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The NYSE proposes to amend its
domestic financial listing standards for
companies proposing to list on the
Exchange contained in Section 102.01C
of the Exchange’s Listed Company
Manual (the ‘‘Manual’’) to allow
domestic companies to qualify for
listing, under certain limited
circumstances, on the basis of their
earnings, cash flows or revenues, as
applicable, in the most recent
completed nine-month period. However
the Exchange must conclude that the
company can reasonably be expected to
qualify under the regular standard upon
completion of its then current fiscal
year.
The text of the proposed rule change
is available on the Exchange’s Web site
(https://www.nyse.com), at the
Exchange’s Office of the Secretary, and
at the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change 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. NYSE
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
NYSE proposes to amend its domestic
financial listing standards for
companies proposing to list on the
Exchange contained in Section 102.01C
of the Exchange’s Listed Company
Manual (the ‘‘Manual’’) to allow
companies seeking to list under the
Exchange’s domestic standards to
qualify for listing, under certain limited
circumstances, on the basis of their
earnings, cash flows or revenues, as
applicable, in the most recent
completed nine-month period.
Section 102.01C of the Manual allows
companies to list under the Exchange’s
domestic listing criteria by meeting one
of the following three standards:
• Earnings Test (1) Pre-tax earnings
from continuing operations and after
minority interest, amortization and
PO 00000
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Fmt 4703
Sfmt 4703
30009
equity in the earnings or losses of
investees, adjusted for certain specified
items, must total at least $10,000,000 in
the aggregate for the last three fiscal
years together with a minimum of
$2,000,000 in each of the two most
recent fiscal years, and positive amounts
in all three years.
• Valuation/Revenue with Cash Flow
Test—
(1) At least $500,000,000 in global
market capitalization,
(2) At least $100,000,000 in revenues
during the most recent 12 month period,
and
(3) At least $25,000,000 aggregate cash
flows for the last three fiscal years with
positive amounts in all three years,
subject to certain adjustments.
• Pure Valuation/Revenue Test—
(1) At least $750,000,000 in global
market capitalization, and
(2) At least $75,000,000 in revenues
during the most recent fiscal year.
Over the years, the Exchange states
that it has been unable to list a number
of financially healthy companies
because those companies had
insufficient earnings, cash flows, or
revenues in the earliest fiscal year
required by the applicable standard. In
many cases, such a company is very
different at the time of its listing
application from the company that had
existed in such earlier period. Such
company may have undergone a
recapitalization transaction in which it
substantially reduced its debt burden.
Alternatively, the company may have
undergone a significant change in its
operations, including, but not limited
to:
• A divestiture or discontinuation of
a loss-making business line,
• A change in management,
• An acquisition or series of
acquisitions,
• Economies of scale and increased
revenues as the company emerges from
its start-up phase,
• The effect of foreign currency
valuation,
• Entering a new geographic region or
market or exiting a geographic region or
market, or
• The launch of a new product or
service.
Therefore, the Exchange proposes to
amend Section 102.01C(I) and (II) (the
‘‘Earnings’’ and ‘‘Valuation/Revenue
with Cash Flow’’ Tests) to enable it to
qualify a company based on the most
recent completed nine months in lieu of
the earliest fiscal year otherwise
required by the applicable standard, in
circumstances where a recapitalization
transaction or significant change in
operations has rendered irrelevant the
financial position of the company in
E:\FR\FM\24MYN1.SGM
24MYN1
30010
Federal Register / Vol. 71, No. 100 / Wednesday, May 24, 2006 / Notices
that third year back and the company
would meet the requirements of Section
102.01C(I) or (II) based on the most
recent nine months and the two
immediately preceding fiscal years. For
the same reasons, the Exchange
proposes to amend Section 102.01C(III)
(the ‘‘Pure Valuation/Revenue’’ Test) on
the basis of the most recent nine
months, instead of a full fiscal year. In
such cases, the Exchange must conclude
that the Company can reasonably be
expected to qualify under the regular
standard upon completion of its then
current fiscal year.
The Exchange believes that investors
are not protected less by the
qualification for listing of companies
that can meet the Earnings or Valuation/
Revenue with Cash Flow Tests on the
basis of 33 months of financial history,
including their last two completed fiscal
quarters, than by the qualification of
companies based on an older three-year
period, particularly if a recapitalization
or significant change in operations has
materially changed the nature of the
company. Similarly, the Exchange
believes that investors are not protected
less by the qualification for listing of
companies that can meet the Pure
Valuation/Revenue Test on the basis of
the most recently completed nine
months period, rather than an older
twelve month period. The Exchange
believes that any company it would
qualify for listing on the basis of the
proposed amendment would meet the
existing standards of Section 102.01C
with the passage of time upon
completion of its next fiscal year.5
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the requirements of Section 6(b) 6 of the
Act, in general, and Section 6(b)(5) 7 of
the Act, in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to remove impediments to, and
perfect the mechanism of a free and
open market and, in general, to protect
investors and the public interest.
jlentini on PROD1PC65 with NOTICES
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
17:08 May 23, 2006
Jkt 208001
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the proposed rule change: (1)
Does not significantly affect the
protection of investors or the public
interest; (2) does not impose any
significant burden on competition; and
(3) does not become operative for 30
days after the date of the filing, or such
shorter time as the Commission may
designate if consistent with the
protection of investors and the public
interest, the proposed rule change has
become effective pursuant to Section
19(b)(3)(A) of the Act 8 and Rule 19b–
4(f)(6) thereunder.9
The Exchange has asked the
Commission to waive the 30-day
operative delay specified in Rule 19b–
4(f)(6)(iii).10 The Commission hereby
grants that request because the
Commission believes that waiving the
30-day operative period is consistent
with the protection of investors and
public interest.11 In its proposal to
qualify a company, in the case of the
Earnings Test and Valuation/Revenue
with Cash Flow Test, on the basis of 33
months of financial history and, in the
case of the Pure Valuation/Revenue
Test, on the basis of nine months of
financial history, the Exchange has
stated its belief that any company that
it would qualify for listing on the basis
of the proposed rule change would meet
the existing standards of Section
102.01C upon completion of its next
fiscal year. Therefore, the Commission
believes that waiving the 30-day
operative delay is consistent with the
protection of investors and the public
interest.
8 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). As required by Rule
19b–4(f)(6)(iii) under the Act, the Exchange also
provided with the Commission with written notice
of its intent to file the proposed rule change, along
with a brief description and text of the proposed
rule change, at least five business days prior to the
date of the proposed rule change.
10 17 CFR 240.19b–4(f)(6)(iii).
11 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f). The
Exchange also requested that the Commission waive
the five-day pre-filing requirement; however, the
Exchange provided the Commission with such
notice; therefore, this request is moot.
9 17
5 For purposes of Rule 3a51–1(a)(1) under the Act,
the Exchange states that, as proposed to be
amended herein, its initial listing standards will be
substantially similar to the initial listing standards
in place on January 8, 2004. 17 CFR 240.3a51–
1(a)(1).
6 15 U.S.C. 78(f)(b).
7 15 U.S.C. 78(f)(b)(5).
VerDate Aug<31>2005
necessary or appropriate in furtherance
of the purposes of the Act.
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At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send e-mail to rulecomments@sec.gov. Please include File
Number SR–NYSE–2006–38 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–NYSE–2006–38. This file
number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro/shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change 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 will also be
available for inspection and copying at
the principal office of the NYSE. 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–NYSE–2006–38 and should
be submitted by June 14, 2006.
E:\FR\FM\24MYN1.SGM
24MYN1
Federal Register / Vol. 71, No. 100 / Wednesday, May 24, 2006 / Notices
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.12
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
Nancy M. Morris,
Secretary.
[FR Doc. E6–7914 Filed 5–23–06; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–53834; File No. SR–NYSE–
2006–32]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing of Proposed Rule Change
Relating to the NYSE Retail Trading
Product and the NYSE Program
Trading Product
May 18, 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 May 9,
2006, the New York Stock Exchange
LLC (‘‘NYSE’’ or ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the NYSE. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
jlentini on PROD1PC65 with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is proposing to
establish fees for two new market data
products: The NYSE Retail Trading
Product and the NYSE Program Trading
Product. The text of the proposed rule
change is available on the Exchange’s
Web site (https://www.nyse.com), at the
NYSE’s Office of the Secretary, and at
the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of, and basis for,
the proposed rule change 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
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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17:08 May 23, 2006
Jkt 208001
1. Purpose
Pursuant to a separate proposed rule
change that NYSE has filed
contemporaneously with the proposed
rule change (see SR–NYSE–2006–31; the
‘‘Pilot Program Filing’’), NYSE proposes
to make available to vendors and
investors the following:
(1) The NYSE Retail Trading Product
will consist of (A) a real-time datafeed
of certain execution report information
that has been recorded as trades for
accounts of ‘‘individual investors’’ 3 and
(B) an end-of-day summary of the retail
trading activity on the Exchange for that
day, including total buy-and-sell retail
share volume for each stock traded (the
‘‘End-of-Day Retail Trading Summary’’).
(2) The NYSE Program Trading
Product will consist of (A) a real-time
datafeed of certain execution report
information that has been recorded as
program trades 4 and (B) an end-of-day
summary of program trading activity on
the Exchange for that day, including
total index arbitrage (as opposed to nonindex arbitrage) program trading volume
(the ‘‘End-of-Day Program Trading
Summary’’).
Each published report of a trade
execution that is included in the
datafeed for either product shall
indicate such information as the
security’s symbol, the size of the trade,
the time of the trade’s execution and
other related information.5 (More
information regarding the NYSE Retail
Trading Product and the NYSE Program
Trading Product can be found on the
NYSE Web site at https://
www.nysedata.com/InfoTools.)
The Exchange believes the NYSE
Retail Trading Product should provide
investors with increased information
3 For this purpose, the ‘‘account of an individual
investor’’ means an account covered by Section
11(a)(1)(E) of the Act. That section refers to the
‘‘account of a natural person, or a trust created by
a natural person for himself or another natural
person.’’
4 For this purpose, ‘‘program trading’’ has the
definition that Supplementary Material .40(b) to
NYSE Rule 80A (‘‘Index Arbitrage Trading
Restrictions’’) gives to that term.
5 NYSE will only include in the NYSE Retail
Trading Product and the NYSE Program Trading
Product information that is attached to execution
reports. While the NYSE believes the information
contained in the NYSE Retail Trading Product and
the NYSE Program Trading Product is accurate, the
NYSE does not guarantee the completeness or
accuracy of account information submitted by order
entry firms on which the InfoTools product is
based.
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30011
regarding individual investors’ trading
activity on the Exchange. Similarly, the
NYSE Program Trading Product should
provide investors with increased
information regarding program trading
activity.
Pursuant to the proposed rule change,
NYSE proposes to establish:
(1) A monthly access fee of $1,500 for
receipt of the NYSE Retail Trading
Product datafeed (for receipt of the realtime datafeed, the end-of-day
summaries, or both);
(2) A monthly access fee of $1,500 for
receipt of the NYSE Program Trading
Product datafeed (for receipt of the realtime datafeed, the end-of-day
summaries, or both);
(3) A monthly display fee of $2.00
that the vendor or its subscribers are to
pay for each display device receiving
NYSE Retail Product information and/or
NYSE Program Trading Product
information (collectively, ‘‘NYSE
Trading Information’’) that the vendor
makes available from the real-time
datafeed; and
(4) A monthly fee of $250 if the
vendor makes NYSE Trade Information
available from the end-of-day
summaries, rather than from the realtime datafeeds.
In addition, each vendor of NYSE
Trading Information will receive a
monthly credit of $2 for each device that
the vendor has entitled to receive
displays of NYSE Trading Information,
up to a maximum of:
(1) $3,000 per month if the vendor
pays the monthly access fees for both
the NYSE Retail Trading Product
datafeed and the NYSE Program Trading
Product datafeed (which two monthly
access fees total $3,000); and
(2) $1,500 per month if the vendor
pays the monthly access fees for either
the NYSE Retail Trading Product
datafeed or the NYSE Program Trading
Product, but not both (either of which
monthly access fees equals $1,500).
The Exchange would commence to
impose those fees 30 days after the
Commission approves them. NYSE
believes that the access and device fees
for the NYSE Retail Trading Product
and the NYSE Program Trading Product
would reflect an equitable allocation of
NYSE’s overall costs to users of its
facilities.
The access fees, the device fees and
the device fee credit apply equally to
every vendor. The Exchange notes that
it proposes to set the device fee offset of
access fees (i.e. the device fee credit) at
such low levels (i.e., a $1500 access fee
is offset in full if only 750 of a vendor’s
customers subscribe to the service) that
the vast majority of vendors that wish to
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]]>Agencies
[Federal Register Volume 71, Number 100 (Wednesday, May 24, 2006)]
[Notices]
[Pages 30009-30011]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-7914]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-53825; File No. SR-NYSE-2006-38]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to the Exchange's Financial Listing Criteria
May 17, 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 May 16, 2006, the New York Stock Exchange LLC (``NYSE'' or
``Exchange''), filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. NYSE has
filed this proposal pursuant to Section 19(b)(3)(A) of the Act \3\ and
Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective
upon filing with the Commission. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The NYSE proposes to amend its domestic financial listing standards
for companies proposing to list on the Exchange contained in Section
102.01C of the Exchange's Listed Company Manual (the ``Manual'') to
allow domestic companies to qualify for listing, under certain limited
circumstances, on the basis of their earnings, cash flows or revenues,
as applicable, in the most recent completed nine-month period. However
the Exchange must conclude that the company can reasonably be expected
to qualify under the regular standard upon completion of its then
current fiscal year.
The text of the proposed rule change is available on the Exchange's
Web site (https://www.nyse.com), at the Exchange's Office of the
Secretary, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change 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. NYSE 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
NYSE proposes to amend its domestic financial listing standards for
companies proposing to list on the Exchange contained in Section
102.01C of the Exchange's Listed Company Manual (the ``Manual'') to
allow companies seeking to list under the Exchange's domestic standards
to qualify for listing, under certain limited circumstances, on the
basis of their earnings, cash flows or revenues, as applicable, in the
most recent completed nine-month period.
Section 102.01C of the Manual allows companies to list under the
Exchange's domestic listing criteria by meeting one of the following
three standards:
Earnings Test (1) Pre-tax earnings from continuing
operations and after minority interest, amortization and equity in the
earnings or losses of investees, adjusted for certain specified items,
must total at least $10,000,000 in the aggregate for the last three
fiscal years together with a minimum of $2,000,000 in each of the two
most recent fiscal years, and positive amounts in all three years.
Valuation/Revenue with Cash Flow Test--
(1) At least $500,000,000 in global market capitalization,
(2) At least $100,000,000 in revenues during the most recent 12
month period, and
(3) At least $25,000,000 aggregate cash flows for the last three
fiscal years with positive amounts in all three years, subject to
certain adjustments.
Pure Valuation/Revenue Test--
(1) At least $750,000,000 in global market capitalization, and
(2) At least $75,000,000 in revenues during the most recent fiscal
year.
Over the years, the Exchange states that it has been unable to list
a number of financially healthy companies because those companies had
insufficient earnings, cash flows, or revenues in the earliest fiscal
year required by the applicable standard. In many cases, such a company
is very different at the time of its listing application from the
company that had existed in such earlier period. Such company may have
undergone a recapitalization transaction in which it substantially
reduced its debt burden. Alternatively, the company may have undergone
a significant change in its operations, including, but not limited to:
A divestiture or discontinuation of a loss-making business
line,
A change in management,
An acquisition or series of acquisitions,
Economies of scale and increased revenues as the company
emerges from its start-up phase,
The effect of foreign currency valuation,
Entering a new geographic region or market or exiting a
geographic region or market, or
The launch of a new product or service.
Therefore, the Exchange proposes to amend Section 102.01C(I) and
(II) (the ``Earnings'' and ``Valuation/Revenue with Cash Flow'' Tests)
to enable it to qualify a company based on the most recent completed
nine months in lieu of the earliest fiscal year otherwise required by
the applicable standard, in circumstances where a recapitalization
transaction or significant change in operations has rendered irrelevant
the financial position of the company in
[[Page 30010]]
that third year back and the company would meet the requirements of
Section 102.01C(I) or (II) based on the most recent nine months and the
two immediately preceding fiscal years. For the same reasons, the
Exchange proposes to amend Section 102.01C(III) (the ``Pure Valuation/
Revenue'' Test) on the basis of the most recent nine months, instead of
a full fiscal year. In such cases, the Exchange must conclude that the
Company can reasonably be expected to qualify under the regular
standard upon completion of its then current fiscal year.
The Exchange believes that investors are not protected less by the
qualification for listing of companies that can meet the Earnings or
Valuation/Revenue with Cash Flow Tests on the basis of 33 months of
financial history, including their last two completed fiscal quarters,
than by the qualification of companies based on an older three-year
period, particularly if a recapitalization or significant change in
operations has materially changed the nature of the company. Similarly,
the Exchange believes that investors are not protected less by the
qualification for listing of companies that can meet the Pure
Valuation/Revenue Test on the basis of the most recently completed nine
months period, rather than an older twelve month period. The Exchange
believes that any company it would qualify for listing on the basis of
the proposed amendment would meet the existing standards of Section
102.01C with the passage of time upon completion of its next fiscal
year.\5\
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\5\ For purposes of Rule 3a51-1(a)(1) under the Act, the
Exchange states that, as proposed to be amended herein, its initial
listing standards will be substantially similar to the initial
listing standards in place on January 8, 2004. 17 CFR 240.3a51-
1(a)(1).
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the requirements of Section 6(b) \6\ of the Act, in general, and
Section 6(b)(5) \7\ of the Act, in particular, in that it is designed
to prevent fraudulent and manipulative acts and practices, to promote
just and equitable principles of trade, to remove impediments to, and
perfect the mechanism of a free and open market and, in general, to
protect investors and the public interest.
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\6\ 15 U.S.C. 78(f)(b).
\7\ 15 U.S.C. 78(f)(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition 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 were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the proposed rule change: (1) Does not significantly affect
the protection of investors or the public interest; (2) does not impose
any significant burden on competition; and (3) does not become
operative for 30 days after the date of the filing, or such shorter
time as the Commission may designate if consistent with the protection
of investors and the public interest, the proposed rule change has
become effective pursuant to Section 19(b)(3)(A) of the Act \8\ and
Rule 19b-4(f)(6) thereunder.\9\
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\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6). As required by Rule 19b-4(f)(6)(iii)
under the Act, the Exchange also provided with the Commission with
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of the proposed rule
change.
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The Exchange has asked the Commission to waive the 30-day operative
delay specified in Rule 19b-4(f)(6)(iii).\10\ The Commission hereby
grants that request because the Commission believes that waiving the
30-day operative period is consistent with the protection of investors
and public interest.\11\ In its proposal to qualify a company, in the
case of the Earnings Test and Valuation/Revenue with Cash Flow Test, on
the basis of 33 months of financial history and, in the case of the
Pure Valuation/Revenue Test, on the basis of nine months of financial
history, the Exchange has stated its belief that any company that it
would qualify for listing on the basis of the proposed rule change
would meet the existing standards of Section 102.01C upon completion of
its next fiscal year. Therefore, the Commission believes that waiving
the 30-day operative delay is consistent with the protection of
investors and the public interest.
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\10\ 17 CFR 240.19b-4(f)(6)(iii).
\11\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f). The Exchange also requested that the Commission waive the
five-day pre-filing requirement; however, the Exchange provided the
Commission with such notice; therefore, this request is moot.
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At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://
www.sec.gov/rules/sro.shtml); or
Send e-mail to rule-comments@sec.gov. Please include File
Number SR-NYSE-2006-38 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-NYSE-2006-38. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro/
shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change 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 will also be available for inspection and copying at the
principal office of the NYSE. 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-NYSE-2006-38 and should be submitted by June 14, 2006.
[[Page 30011]]
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
Nancy M. Morris,
Secretary.
[FR Doc. E6-7914 Filed 5-23-06; 8:45 am]
BILLING CODE 8010-01-P
