6432 Federal Register / Vol. 65, No. 27 / Wednesday, February 9, 2000 / Notices

10 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

3 In Amendment No. 1, the NYSE made several

clarifications to the proposed rule change,

incorporated appropriate provisions for Non-US

issuers, and revised the procedures for the annual

report requirement. See Letter to Richard Strasser,

Assistant Director, Division of Market Regulation

(‘‘Division’’), SEC, from James E. Buck, Senior Vice

President and Secretary, NYSE, dated October 22,

1999 (‘‘Amendment No. 1’’).

4 In Amendment No. 2, the NYSE made several

technical changes to the text of the proposed rule

change and clarified that the supplemental listing

application (‘‘SLAP’’) provision applies to Non-U.S.

issuers. See Letter to Richard Strasser, Assistant

Director, Division, SEC, from James E. Buck, Senior

Vice President and Secretary, NYSE, dated

December 14, 1999 (‘‘Amendment No. 2’’). In

Amendment No. 2, the Exchange also requested

accelerated approval of the proposed rule change.

The Exchange withdrew this request as per

telephone conversation between Amy Bilbija,

Counsel, NYSE, and Terri Evans, Special Counsel,

and Heather Traeger, Attorney, Division, SEC, on

January 4, 2000.

*As such term is defined by the Securities and

Exchange Commission in Rule 16a–1(f) under the

Securities Exchange Act of 1934, or any successor

rule.

B. institute proceedings to determine

whether the proposed rule change

should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing,

including whether the proposed rule

change is consistent with the Act.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, NW,

Washington, DC 20549–0609. 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 at

the Commission’s Public Reference

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the NASD. All

submissions should refer to File No.

SR–NASD–99–77 and should be

submitted by March 1, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.10

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–2967 Filed 2–8–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42364; File No. SR–NYSE–

99–14]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change and

Amendment Nos. 1 and 2 Thereto by

the New York Stock Exchange, Inc.

Relating to Amendments to the Listed

Company Manual

January 28, 2000.

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 April 12,

1999, the New York Stock Exchange,

Inc. (‘‘NYSE’’ 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 Exchange.

On October 25, 1999, the Exchange

submitted Amendment No. 1 to the

proposed rule change.3 On December

16, 1999, the Exchange submitted

Amendment No. 2.4 The Commission is

publishing this notice to solicit

comments on the proposed rule change

from interested persons.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The proposed rule change consists of

amendments to the Listed Company

Manual (‘‘Manual’’) to: (1) Implement

regulatory reviews of key personnel

associated with listing applicants; (2)

codify the Exchange’s procedures

regarding supplemental listing

applications for companies identified as

being below continued listing standards;

and (3) amend its disclosure

requirements for listed companies late

in filing their form 10–K or annual

report. The text of the proposed rule

change follows. New text is italicized.

Deleted text is bracketed.

NYSE Listed Company Manual

* * * * *

Section 3

Corporate Responsibility

* * * * *

315.00 Regulatory Review of Listing

Candidates and their Significant

Related Individuals and Entities

Each listing applicant must provide

the Exchange with a letter from counsel

representing that, to the company’s

knowledge, no officer,* board member,

no non-institutional shareholder with

greater than 10% ownership of the

company has been convicted of a felony

or misdemeanor relating to financial

issues (e.g., embezzlement, fraud, theft)

in the past ten years. In addition, the

Exchange will review background

materials available to its regarding the

aforementioned individuals as part of

the eligibility review process.

* * * * *

Section 7

Listing Applications

* * * * *

703.11 Supplemental Listing Process

* * * * *

(C) No supplemental listing

applications will be approved for

companies that have been identified as

being below the Exchange’s continued

listing standards (see Para. 802.01) for

issuances to new shareholders unless

such issuance is determined to be

consistent with an Exchange-approved

plan (or its goals) pursuant to Para.

802.02 or Para. 802.03 as applicable.

* * * * *

Section 2

Disclosure and Reporting Material

Information

* * * * *

203.00 Annual and Interim Reporting

Requirements

203.01 Annual Report Requirement

The Exchange requires that

companies publish at least once a year

and [submit] distribute to shareholders

an annual report containing financial

statements of the company and its

consolidated subsidiaries prepared in

conformity with generally accepted

accounting principles. The company

must distribute its annual report to its

shareholders not later than [three

months] 120 days (225 days for non-US

issuers) after the close of each fiscal

year. [, but] Notwithstanding the

foregoing, domestic issuers must make

this distribution at least fifteen days in

advance of the annual meeting. )Non-US

issuers are encouraged to do so when

possible.) When the annual report is

mailed to shareholders, two copies

should be sent to the Exchange together

with advice as to the date of mailing to

shareholders.

Companies may satisfy the annual

distribution requirement either by

distributing an annual report to share

holders, or by distributing to

shareholders to Form 10–K (or Form 20–

F for Non-US issuers) filed with the SEC,

with an indication that it is distributed

in lieu of a separate annual report.

When the annual report (or Form 10–K

or Form 20–F) is mailed to shareholders,

two copies should be sent to the

Federal Register / Vol. 65, No. 27 / Wednesday, February 9, 2000 / Notices 6433

5This provision will apply to both U.S. and NonU.S. issuers.

6See Amendment No. 1, supra note 3. Domestic

companies are required to submit their annual

filings on Form 10–K to the SEC within 90 days of

the fiscal year end. International companies are

required to submit their annual filings on Form 20–

F within 180 days of the fiscal year end.

7 Id.

8 Id.

9 Id.

10 15 U.S.C. 78f(b)(5).

Exchange together with advice as to the

date of mailing to shareholders.

Distribution by electronic means

(including by posting on the company’s

web site) will be effective only as to

beneficial holders who have given their

prior consent to receiving the report in

that form. Such consent must be in

writing, which may be in the form of

electronic mail.

A company that is unable to timely

file its Form 10–K or Form 20–F with the

SEC must notify the Exchange prior to

the SEC filing deadline, explaining the

reason for the delay and the anticipated

filing date. The Exchange will evaluate

the circumstances and the continued

listing status of the company, and at a

minimum will require the company to

issue a press release indicating the

delay, the reason for the delay and the

anticipated filing date. In making its

evaluation, the Exchange will consider

whether the company has released or

plans to release to the press information

regarding its financial results for the

fiscal year. Once the company does file

its Form 10–K (Form 20–F) with the SEC,

it must then distribute to shareholders

an annual report or a Form 10–K (Form

20–F) in lieu thereof no later than 15

days (30 days for a non-US issuer) after

the filing.

(A)–(E) Unchanged.

* * * * *

[(F) Availability of Form 10–K When

Annual Report is Delayed If distribution

of the annual report to shareholders to

be delayed more than two weeks even

though the Form 10–K has been filed,

the company should release to the

financial press copies of the Form 10–

K together with a statement advising

that the annual report has been delayed

and the reason for the delay, specifying

the date when the annual report will be

mailed and indicating that a copy of the

Form 10–K is available to shareholders

on request.]

* * * * *

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

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 implement several

enhancements to the Exchange’s

procedures and oversight of listed

companies. First, the Exchange proposes

to institute a regulatory review

procedure for listing applicants whereby

Exchange staff would access media

outlets, run Central Registration

Depository checks, and consult with

staff in the SEC’s Division of

Enforcement to identify any potential

issues of concern regarding the

applicant company’s board members,

officers (as the term ‘‘Officer’’ is defined

in Section 16 of the Act), and noninstitutional shareholders with an

interest in excess of 10 percent. In

addition, the Exchange will require each

applicant company to submit a letter

from inside or outside counsel

representing that, to the company’s

knowledge, no officer, board member, or

non-institutional shareholder with more

than 10 percent ownership in the

company has been convicted of a felony

or misdemeanor relating to financial

issues (e.g., embezzlement, fraud, or

theft) in the past 10 years.

Second, the Exchange proposes to

amend its procedures for processing

SLAPs submitted for consideration by

companies that have been identified as

being below the Exchange’s continued

listing criteria.5 Upon receipt of a SLAP

from such a company, Exchange staff

would first determine whether or not

the SLAP is for an issuance to current

shareholders (e.g., a stock split). If so,

the application would be authorized. If,

however, the SLAP is for an issuance to

new shareholders, the application will

be reviewed against the plan pursuant to

which the company is operating to

return to financial compliance with the

Exchange’s listing standards. If the

proposed issuance is within the scope of

the plan, or furthers the goals of the

plan, it will be approved. Conversely,

the Exchange will deny authorization if

the proposed issuance is outside the

scope of the plan or contradicts its

goals. In this context, the Exchange

recognizes that employee stock option

plans, although rarely a specific element

of a financial plan, are customarily in

furtherance of the company’s objectives

in that they are adopted to facilitate

equity-based compensation to

employees and thus provide incentive

to employees to further the financial

health of the company—a goal that is by

its nature consistent with any approved

plan.

Third, the Exchange proposes to

amend its annual report requirements.

The Exchange proposes to require that

a company mail to shareholders by the

specified date either an annual report or

a Form 10–K (Form 20–F for Non-U.S.

issuers) with an indication that is in lieu

of the annual report.6 Due to longer

mailing and processing time,

international companies will have a

maximum period following the SEC

filing deadlines of 45 days to mail either

the annual report or Form 20–F (with an

indication that it is in lieu of the annual

report), where domestic issuers have 30

days.7

For companies that are unable to

timely file a Form 10–K (or Form 20–F),

the Exchange proposes to consider why

the filing cannot be made, evaluate the

continued listing status of the company

in light of the specific facts presented,

and require that the company issue a

press release. Once the Form 10–K (or

Form 20–F) is filed, the Exchange

proposes to require a mailing of the

Form 10–K (or Form 20–F) or an annual

report to shareholders within 15 days

(30 days for a Non-U.S. issuer).8

Additionally, the Exchange proposes

to permit companies to distribute the

annual reports or SEC forms

electronically to beneficial holders who

give prior written consent. Such consent

must be in writing, which may be in the

form of electronic mail.9

Failure to comply with these

requirements will result in presentation

of the company’s situation to Exchange

staff for appropriate action. Such action

could include the determination to

proceed with suspension of trading and

application to the SEC to delist the

security.

2. Statutory Basis

The Exchange believes that the basis

under the Act for the proposed rule

change is the requirement under section

6(b)(5)10 that an Exchange have rules

that are designed to promote just and

equitable principles of trade, to remove

impediments to, and perfect the

mechanism of a free and open market

6434 Federal Register / Vol. 65, No. 27 / Wednesday, February 9, 2000 / Notices

11 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 41711

(August 5, 1999), 64 FR 44073.

4See Letter from John Dayton, Counsel, Phlx, to

Nancy Sanow, Senior Special Counsel, Division of

Market Regulation, SEC, dated December 23, 1999.

5 17 CFR 200.30–3(a)(12).

and, in general, to protect investors and

the public interest.

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

No written comments were solicited

or received with respect to the proposed

rule change.

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 Exchange consents,

the Commission will:

(a) By order approve the proposed

rule change, or

(b) Institute proceedings to determine

whether the proposed rule change

should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing,

including whether the proposed rule

change, as amended, is consistent with

the Act. Persons making written

submissions should file six copies

thereof with the Secretary, Securities

and Exchange Commission, 450 Fifth

Street, NW., Washington, DC 20549–

0609. 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 at

the Commission’s Public Reference

Room. Copies of such filing will also be

available for inspection and copying at

the principal office of the Exchange. All

submissions should refer to File No.

SR–NYSE–99–14 and should be

submitted by March 1, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–2881 Filed 2–8–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42377; File No. SR–Phlx–

99–24]

Self-Regulatory Organizations; Notice

of Withdrawal of Proposed Rule

Change by the Philadelphia Stock

Exchange, Inc. Relating to the

Establishment of a Fee to Members for

Receiving On-Line Options Information

February 2, 2000.

On June 29, 1999, the Philadelphia

Stock Exchange, Inc. (‘‘Phlx’’ or

‘‘Exchange’’) filed with the Securities

and Exchange Commission

(‘‘Commission’’) a proposed rule

change, pursuant to Section 19(b)(1) of

the Securities Exchange Act of 1934

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 to

adopt a fee for the transmission to

members of option trade information on

a real-time trade basis. Notice of the

proposed rule change was published on

August 12, 1999, in the Federal

Register, to solicit comments from

interested persons.3 On December 28,

1999, the Exchange withdrew the

proposed rule change.4

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.5

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–2966 Filed 2–8–00; 8:45 am]

BILLING CODE 8010–01–M

UNITED STATES SENTENCING

COMMISSION

Sentencing Guidelines for United

States Courts

AGENCY: United States Sentencing

Commission.

ACTION: Notice of finalized policy

development agenda.

SUMMARY: As part of its statutory

authority and responsibility to analyze

sentencing issues, including operation

of the federal sentencing guidelines, and

in accordance with Rule 5.2 of its Rules

of Practice and Procedure, the

Commission proposed, in December

1999, certain priorities as the focus of its

policy development work, including

amendments to guidelines, policy

statements, and commentary, for the

amendment cycle ending May 1, 2000.

The Commission was reconstituted in

November 1999, in the middle of that

amendment cycle. Due to the resulting

constraints of an abbreviated

amendment cycle, the Commission has

proposed as its priorities for the

amendment cycle ending May 1, 2000

only those items the Commission might

be able to conclude by its statutory

deadline of May 1.

The Commission published a notice

of these proposed priorities in the

Federal Register on December 8, 1999.

See 64 FR 68,715, Dec. 8 ,1999. After

reviewing public comment received

pursuant to this notice, the Commission

has decided to limit its current policy

development priorities principally to

the following areas: (i) Implementation

of legislative directives and other high

priority crime legislation enacted by the

105th Congress for which guideline

amendments were not developed or

finalized by the previous Commission;

and (ii) resolution of a limited number

of high priority circuit conflicts in

guideline interpretation, with the goal of

enhancing the consistency with which

the guidelines are applied.

FOR FURTHER INFORMATION CONTACT:

Michael Courlander, Public Affairs

Officer, Telephone: (202) 502–4590.

SUPPLEMENTARY INFORMATION:

Priorities.’’The specific policy

development issues that comprise the

Commission’s finalized agenda are as

follows—

I. Legislative Directives

The Commission has identified the

implementation of the following

directives as a priority for this

amendment cycle:

(A) The No Electronic Theft (NET) Act

of 1997—Congress directed the

Commission, under emergency

amendment authority, to ensure that: (1)

The guideline penalties for intellectual

property offenses are sufficiently

stringent to deter those crimes; and (2)

the guidelines pertaining to intellectual

property offenses provide for

consideration of the retail value and

quantity of infringed items.

(B) The Telemarketing Fraud

Prevention Act of 1998—Congress