Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6647

Applicant’s Conditions

Applicants agree that the order will be

subject to the following conditions:

1. Transactions effected pursuant to

the order will be effected in accordance

with all of the provisions of rule 10f–3,

other than paragraph (b)(8). At least a

majority of any class of an issue of

Minnesota Tax-Exempt Securities

purchased pursuant to the order must be

purchased by persons who are not

Related Purchasers. If the aggregate

number of securities the Related

Purchasers wish to acquire exceeds the

permitted amount, the securities

acquired will be allocated to each

Related Purchaser in the proportion that

the number of securities that such

Related Purchaser wishes to acquire

bears to the total number of securities

that all Related Purchasers wish to

acquire.

2. Purchases of Minnesota TaxExempt Securities directly from Piper

Jaffray or from a syndicate manager of

an underwriting syndicate of which

Piper Jaffray is a member when the

purchases are designated as group sales

may be effected only in Minnesota TaxExempt Securities that, at the time of

purchase, have one of the following

investment grade ratings from at least

one nationally recognized statistical

rating organization: (i) One of the two

highest investment grade ratings in the

case of securities with remaining

maturities of one year or less, or (ii) one

of the three highest investment grade

ratings in the case of securities with

remaining maturities greater than one

year.

3. Purchases of Minnesota TaxExempt Securities directly from Piper

Jaffray or from a syndicate manager of

an underwriting syndicate of which

Piper Jaffray is a member when the

purchases are designated as group sales

will be limited so that no such

transaction will be effected if, as a

result, the aggregate value of Minnesota

Tax-Exempt Securities held by a Fund

and acquired pursuant to the order

would exceed 50% of the total net assets

of that Fund.

4. Purchases of Minnesota TaxExempt Securities directly from Piper

Jaffray or from a syndicate manager of

an underwriting syndicate of which

Piper Jaffray is a member when the

purchases are designated as group sales

will be effected only when the

Minnesota Tax-Exempt Securities to be

acquired are otherwise unavailable for

purchase. If Piper Jaffray is the sole

underwriter of the securities, this

condition is automatically fulfilled

because there is no other potential

seller. When Piper Jaffray is a member

of an underwriting syndicate, U.S. Bank

will observe the following procedures to

determine when the securities are

unavailable from other members of the

syndicate. Initially, U.S. Bank will

determine the aggregate number of

securities that the Related Purchasers

wish to acquire. Next, U.S. Bank will

attempt to purchase as much of this

number as possible from members of the

syndicate other than Piper Jaffray. After

acquiring as many securities as possible

from such other members, U.S. Bank

will attempt to purchase from Piper

Jaffray the number of securities that the

Related Purchasers wish to acquire and

have been unable to obtain from such

other members. The securities acquired

from such other members will be

allocated first to the Funds to the extent

of the number of securities the Funds

wish to acquire, or the number of

securities the Funds are entitled to

acquire based upon the relative needs of

the Related Purchasers and the total

number of securities purchased from

such other members and from Piper

Jaffray, whichever is less.

5. When the Funds purchase

Minnesota Tax-Exempt Securities from

a syndicate manager of an underwriting

syndicate of which piper Jaffray is a

member, the Funds will not: (i) Submit

designated orders to a syndicate

manager that are allocated to Piper

Jaffray; (ii) submit group orders to a

syndicate manager that designate Piper

Jaffray to receive any portion of the

commission; or (iii) otherwise allocate

orders to Piper Jaffray.

6. The exemption will be valid only

so long as U.S. Bank and Piper Jaffray

operate as separate entities and

independent profit centers within the

holding company framework of U.S.

Bancorp, with separate officers and

employees, separate capitalizations, and

separate books and records. Employees

of Piper Jaffray will not participate with,

or seek to influence, U.S. Bank in its

investment decisions as investment

adviser to the Funds, other than in the

normal course of sales activities of the

same nature that are being carried out

simultaneously with respect to

unaffiliated clients of Piper Jaffray.

Senior executives of U.S. Bancorp with

responsibility for overseeing the

operations of various subsidiaries are

not precluded from exercising those

functions over U.S. Bank because they

oversee Piper Jaffray as well, provided

that such persons will not have any

involvement with respect to

transactions effected pursuant to the

exemption and will not attempt to

influence or control the purchase of

securities by the Funds from Piper

Jaffray or an underwriting syndicate of

which Piper Jaffray is a member.

7. U.S. Bank and Piper Jaffray will

adopt a set of guidelines for their

respective personnel to make certain

that transactions conducted pursuant to

the order comply with the conditions

set forth in the application and that the

parties maintain arm’s length

relationships. Compliance officers of

U.S. Bank and Piper Jaffray will

periodically monitor the activities of

their respective companies for

compliance with such guidelines and

with the conditions set forth in the

application.

8. The board of directors of each

Fund, including a majority of the

directors who are not interested persons

under section 2(a)(19) of the Act and

have no direct or indirect financial

interest in the transaction (other than

through ownership of Fund shares), will

review, no less frequently, each

purchase of Minnesota Tax-Exempt

Securities directly from Piper Jaffray or

from a syndicate manager of an

underwriting syndicate of which Piper

Jaffray is a member when the purchases

are designated as group sales since the

last review and will determine that the

terms of such transaction were

reasonable and fair to the shareholders

of the Fund and did not involve

overreaching of the Fund or its

shareholders on the part of any person

concerned. In considering whether the

price paid for the security was

reasonable and fair, the price of the

security will be analyzed with respect to

comparable transactions involving

similar securities being purchased or

sold during a comparable period of

time.

For the Commission, by the Division of

Investment Management, under delegated

authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–3086 Filed 2–9–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42378; File No. SR–Amex–

99–39]

Self-Regulatory Organizations; Notice

of Filing of Proposed Rule Change by

the American Stock Exchange LLC

Amending Certain Listing Standards

February 2, 2000.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

6648 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

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

2 17 CFR 240.19b–4.

3Letter from Michael Cavalier, Associate General

Counsel, Legal & Regulatory Policy, Amex, to Jack

P. Drogin, Assistant Director, Division of Market

Regulation (‘‘Division’’), Commission, dated

December 13, 1999 (‘‘Amendment No. 1’’).

Amendment No. 1 revises Section 1101 of the Amex

Company Guide to add references to forms filed

with the Commission by unit investments trusts

and open-end management investment companies. 4Letter from Michael J. Ryan, Jr., Chief of Staff,

Amex, to Jack P. Drogin, Assistant Director,

Division, Commission, dated December 31, 1999

(‘‘Amendment No. 2’’). As originally filed, the

proposed rule change eliminated the requirement to

submit with an original listing application certain

corporate documents and an opinion of counsel

regarding the legality of the organization, existence

of the issuer, and the validity of the securities to

be issued. Amendment No. 2 reinstates the

requirement to submit these documents.

Amendment No. 2 also makes certain technical

changes to the proposed rule change.

5Letter from Michael J. Ryan, Jr., Chief of Staff,

Amex, to Jack P. Drogin, Assistant Director,

Division, Commission, dated January 18, 2000

(‘‘Amendment No. 3’’). Amendment No. 3

eliminates the requirement to file certain

documents with an original listing application,

including an issuer’s charter and by-laws, as well

as an opinion of counsel. In lieu of requiring these

documents to be submitted, Amendment No. 3

states that the Exchange will ask issuers specific

questions concerning quorum requirements, notice

of record dates to schareholders and closing of

transfer books. In addition, Amendment No. 3 states

that the Exchange will require issuers to (i) furnish

the Exchange with copies of opinions of counsel

filed in connection with recent public offerings or

private placements or (ii) if no opinions of counsel

exist, represent to the Exchange that they are duly

and validly organized under the laws of their state

of incorporation. Finally, Amendment No. 3

reinstates Section 125 of the Amex Company Guide,

relating to remedies available to bondholders upon

default.

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

notice is hereby given that on

September 28, 1999, the American Stock

Exchange LLC (‘‘Amex’’ or ‘‘Exchange’’)

filed with the Securities and Exchange

Commission the proposed rule change

as described in Items, I, II, and III below,

which Items have been prepared by the

Exchange. The Exchange filed

Amendments No. 1,3 2,4 and 3,5 to the

proposed rule change on December 14,

1999, January 4, 2000, and January 19,

2000, respectively. 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 Exchange proposes to amend

certain provision of its listing standards

to simplify the listing process, eliminate

certain outdated processes, and to

clarify the Exchange’s alternative listing

guidelines for domestic companies. The

text of the proposed rule change is as

follows. Proposed new language is in

italic; deletions are in brackets.

* * * * *

Listing Standards, Policies and

Requirements

PART 1. Original Listing Requirements—

Listing Fees (§§ 101–146)

CRITERIA FOR ORIGINAL LISTING

(§§ 101–118)

Sec. 101. GENERAL

The approval of an application for the

listing of securities is a matter solely within

the discretion of the Exchange. To assist

companies interested in applying for listing,

the Exchange has established certain

numerical guidelines, outlined below, which

will be considered in evaluating listing

eligibility. Other factors which will also be

considered include the nature of a company’s

business, the market for its products, the

reputation of its management, its historical

record and pattern of growth, its financial

integrity, its demonstrated earning power and

its future outlook.

The fact that an applicant may meet the

Exchange’s numerical guidelines does not

necessarily mean that its application will be

approved. On the other hand, an application

may be approved even though the company

does not meet all of the numerical guidelines.

[The Exchange will furnish, without

charge, a confidential preliminary opinion as

to the eligibility of an applicant for listing as

described in § 202.]

See §[§’s] 110 [and 115] for special criteria

relating to foreign issuers [and member

corporations] and Rules 1000, 1000A, and

1200 for rules relating to portfolio deposit

receipts, Index Fund Shares, and Trust

Issued Receipts.

(a) REGULAR LISTING CRITERIA

([a]1) Size—Stockholders’ equity of at least

$4,000,000.

([b]2) Income—Pre-tax income of at least

$750,000 in its last fiscal year, or in two of

its last three fiscal years.

Additional criteria applicable to various

classes of securities and issuers are set forth

below. Applicants should also consider the

policies regarding conflicts of interest,

independent directors and voting rights

described in §§ 120–125.

(b) ALTERNATE LISTING CRITERIA [FOR

DOMESTIC COMPANIES

It is recognized that certain financially

sound companies are unable to meet fully the

Exchange’s regular listing criteria because,

for example, of the nature of their business,

or because of continuing large expenditures

of funds for research and development. Such

companies may, however, qualify for listing

provided they meet the numerical criteria

outlined below, have sufficient financial

resources to continue operations over an

extended period of time, and are otherwise

regarded as suitable for Exchange listing.

Among the factors considered by the

Exchange in determining a company’s listing

eligibility are the following:

(a) the nature and scope of the applicant’s

operations, including its demonstrated ability

to acquire or discover and develop new

products or properties, the potential or

proven market for existing or future products

and the company’s plans for future

development and expansion of its existing

resources;

(b) the applicant’s financial condition and

accounting practices, its ability to service

existing debt and other obligations, the

availability of financing for currently

committed programs and future expansion,

and the size of its development expenses in

relation to its equity and revenues;

(c) the composition of the applicant’s

assets including its reserves, royalties, or

other rights and patents;

(d) the experience and reputation of the

applicant and its management; and

(e) the nature and effect of governmental

policies or restrictions on the company’s

products or properties and the extent of

competition and economic conditions within

the particular industry.

Numerical Criteria:]

([a]1) History of Operations—Three years

of operations.

([b]2) Size—Stockholders’ equity of at least

$4,000,000.

([c]3) Distribution—See Section 102(a).

([d]4) Aggregate Market Value of Publicly

Held Shares—$15,000,000.

Sec. 102. EQUITY ISSUES

(a) Distribution—Minimum public

distribution * of 500,000, together with a

minimum of 800 public shareholders or

minimum public distribution of 1,000,000

shares together with a minimum of 400

public shareholders.

Footnotes: *The terms ‘‘public

distribution’’ and ‘‘public shareholders’’ as

used in the Company Guide include both

shareholders of record and beneficial

holders, but are exclusive of the holdings of

officers, directors, controlling shareholders

and other concentrated (i.e. [5]10% or

greater, affiliated or family holdings.

* * * * *

Sec. 103. PREFERRED STOCK

(a)–(c) no change

[(d) Redeemable Issues—Redeemable

issues, if subject to redemption in part, must

be redeemable only pro rata or by lot. (See

§ 902.)]

Sec. 104. BONDS AND DEBENTURES

* * * * *

[Redeemable Issues

Redeemable issues, if subject to

redemption in part, must be redeemable only

pro rata or by lot. (See § 902)]

* * * * *

Issuer or Bond Rating Status

For the Exchange to list a debt security, the

security must be characterized by one of the

following conditions:

(A) the issuer of the debt security has

equity securities listed on the Exchange (or

on the New York Stock Exchange or on the

Nasdaq National Market);

(B) an issuer of equity securities listed on

the Exchange (or on the New York Stock

Exchange or on the Nasdaq National Market)

directly or indirectly owns a majority interest

in, or is under common control with, the

issuer of the debt security;

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6649

(C) an issuer of equity securities listed on

the Exchange (or on the New York Stock

Exchange or on the Nasdaq National Market)

has guaranteed the debt security;

* * * * *

Sec. 105. WARRANTS

The listing of warrant issues is concerned

on a case by case basis. The Exchange will

not consider listing the warrant issue of a

company unless the common stock or other

securities underlying the warrants are listed

and in good standing either on the American

or New York Stock Exchanges or on the

Nasdaq National Market and there are at

least 200,000 warrants publicly held by not

less than 100 public warrantholders. In

addition, to be listed, warrant issues are

expected to meet the following criteria:

(a) no change

[(b) Redeemable (callable) Issues—

Warrant, if subject to redemption in part,

must be redeemable only pro rata or by lot.

The Exchange requires advance notice of the

Call Date (if any) as defined in its Warrant

Agreement with the warrant agent(s). (See

§ 902.)]

* * * * *

[Sec. 112. EXPLORATION AND

DEVELOPMENT COMPANIES

The Exchange generally will not list the

securities of companies organized for the

exploration and development of natural

resources until they have reached the

production stage and meet the criteria set

forth in § 101.]

* * * * *

[Sec. 115. MEMBER CORPORATIONS

The following requirements and

procedures will apply to the original listings

of securities of publicly-owned member

corporations:

Minimum Standards:

(a) Size-Stockholders’ equity of at least $10

million. In determining a listing applicant’s

ability to meet this standard, the Exchange

will value securities owned by the applicant

at less than market value, depending upon

the ready marketability of such securities.

The applicant shall include in its listing

application a list and the amounts of the

securities owned by it, the names of the

exchanges on which they are listed, and

whether there are any restrictions against

their sale as in the case of securities acquired

for investment (‘‘letter stock’’).

(b) Earnings-Pre-tax income of at least $1.5

million for the latest fiscal year.

(c) Historical Operations—A history of

satisfactory operations for at least 3 years

prior to listing in order to demonstrate the

applicant’s ability to operate profitability

under normal conditions. As in the case of

all other listing applicants, all relevant

factors regarding a member corporation’s

operations will be carefully considered,

including the period of time in which present

management has conducted the corporation’s

operations and the changes, if any, in

management during the three year period

under review.

(d) Capital Ratios—A regular capital ratio

which has not exceeded 10-to-1 (or an

alternate capital ratio which has not been less

than 5%) for any period of 15 consecutive

days during the six-month period preceding

filing of the applicant’s listing application.

Procedures:

In addition to the usual review procedures

applicable to other types of corporations, the

following special procedures will apply in

reviewing member corporations for listing:

(a) Reports received by the Exchange under

FOCUS filing requirements will be reviewed

and any problems indicated by such reports

will be required to be satisfactorily resolved

before listing. FOCUS reports will be

required of any member corporation listing

applicant not already filing them for a threemonth period before consideration of the

listing application.

(b) In the case of an applicant which is also

a member of the New York Stock Exchange,

a copy of the report of the most recent

examination by the New York Stock

Exchange will be reviewed and any problems

disclosed in such report must be

satisfactorily resolved before listing.

Disclosure:

Any member corporation, which intends to

list its securities on the Exchange, will be

required to include in its prospectus

additional disclosures with respect to certain

regulatory actions which the Exchange (or

the New York Stock Exchange) may take and

which may have an adverse impact on the

firm’s future income and prospects. Among

the actions which such Exchanges may take

are:

(a) limiting the opening of new offices,

employment of new registered

representatives, or opening of new accounts;

(b) requiring an organization to cease

business as a clearing organization and

become solely an introducing broker;

(c) restricting the types of activities which

a member organization performs;

(d) requiring an organization to reorganize

or even to liquidate its business; and

(e) requiring a listed member corporation

to make timely disclosure of material

information concerning its business,

financial situation or prospects, or other

matters which might have a bearing on its

operations.

In addition to publishing quarterly

statements of revenues and earnings as

required by the rules and regulations of the

Exchange, a listed member corporation shall

be required to distribute copies of such

statements to its stockholders. Such quarterly

reports, as well as the annual report, shall

also contain a statement regarding the

corporation’s net capital position in relation

to the standards of the Exchange and the New

York Stock Exchange.

A listed member corporation shall be

required to file with the Exchange copies of

its financial statements and questionnaires

which it files with the New York Stock

Exchange.]

[Sec. 116. COMPANIES ENGAGED IN

GAMING OPERATIONS

In addition to the many factors considered

in the evaluation of any application for

original listing (see § 101), the Exchange will

give particular attention to the historical

record, operating procedures and

management personnel of any applicant

company which is engaged, to any

substantial extent, in gaming operations. An

applicant of this nature will be required to

demonstrate that it has adequate procedures

and management capabilities to detect and

appropriately control any of the following:

(a) the association with any person having

a criminal background or who would not

qualify for a license under any Federal, state

or local regulatory requirements under which

the applicant company operates;

(b) any misuse of the company’s funds or

misappropriation of its receipts from gaming

operations; or

(c) any activities by persons associated

either directly or indirectly with the

company designed to promote the company’s

securities in contravention of the securities

laws or to evade the disclosure requirements

of the Exchange.

Any of the following factors may be

considered by the Exchange as a basis for

refusing to approve the application of a

company engaged in gaming operations:

(a) if the company (or any predecessor

organization that has been responsible for

operating such gaming facilities), or any

officer, director, controlling stockholder or

managerial or supervisory employee of the

company or of any such predecessor, or any

other person having an association or

relationship with the company or such

predecessor whereby such person was, or is,

in a position to influence management

decisions with respect to, or to receive

benefits from, the operation of such gaming

facilities, has been convicted of any criminal

offense relating to gaming or to any other

business of the company or such predecessor,

or relating to fraud, violation of the securities

laws or violation of any Federal or state antiracketeering or similar statutes, at any time

during a period ten (10) years preceding the

date of the application for listing;

(b) if any person described in the preceding

paragraph has been indicted or cited for

violation of any Federal, state or local statute

or ordinance relating to gaming or fraud, or

has been denied a license or had his license

revoked by any Federal, state, or local agency

having jurisdiction over gaming operations,

or any such person has been identified by an

appropriate Federal or state agency as being

associated with organized crime or with

other persons conspiring to violate gaming or

anti-racketeering statutes, at any time during

a period of five (5) years preceding the date

of the application for listing;

(c) if any investigation (by any appropriate

Federal, state or local agency) of the

company, or of any predecessor or other

person described in the first paragraph above,

has disclosed any material violations of any

law, rule or regulations applicable to the

gaming operations of the company, during a

period of five (5) years preceding the date of

the application for listing;

(d) if the company has in its employ, or has

associated with it in any capacity, any person

who, if required to be licensed in any

Federal, state or local agency having

jurisdiction over gaming operations, is not so

licensed or has been denied a license or has

been found to be unsuitable to receive a

license;

(e) if the company, or any predecessor or

other person described in the first paragraph

6650 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

above, shall have been finally determined to

be liable for any income or other tax

deficiency based upon an understatement of

revenues or income from gaming activities,

during a period of five (5) years preceding the

date of the application for listing; or

(f) if the company, or any predecessor

described in the first paragraph above, shall

have failed to received an unqualified

opinion of an independent public accountant

with respect to the balance sheet and

statement of operations of the company or

any such predecessor for each of the five (5)

fiscal years preceding the date of the

application for listing.

In connection with the subsequent filing of

any listing application by a company seeking

to issue additional securities, the purpose of

which is to enable the company to become

engaged to a substantial degree in gaming or

related activities, the Exchange will apply all

of the above standards to the same extent as

though the application were for original

listing. Moreover, the Exchange will consider

the suspension of trading in, or removal from

listing or unlisted trading of, the securities of

any company which, after the effective date

of this policy, takes steps to become engaged

in gaming operations to any substantial

degree, unless the company can demonstrate

that it meets all of the above special

requirements for original listing of companies

engaged in gaming operations.]

* * * * *

Sec. 118. INVESTMENT TRUSTS

* * * * *

A. INVESTMENT TRUSTS BASED ON

SECURITIES OF INDIVIDUAL ISSUERS

(a)–(d) no change

[(e) Trustees—The requirements of

paragraphs (a), (c) and (d) of § 811 of the

Guide apply.]

([f]e) Voting—no change

([g]f) Shareholder Communications—no

change

([h]g) Listing Agreement—In addition to

the above, an investment Trust applying for

listing under this section of the Guide shall

sign a listing agreement with the Exchange

which, among other things, requires

compliance with the following Exchange

Rules and Regulations regarding:

(i) Additional Listing—(see Part 3 of the

Guide);

(ii) Dividends, Stocks Splits and

Distributions (see §§ 501–507 and 509 of the

Guide);

(iii) [Transfer Facilities, Certificates—(see

§§ 801–841 of the Guide);

(iv)] Notification—comply with existing

notification requirements of the Exchange.

B. INVESTMENT TRUSTS BASED ON

STOCK INDEXES OR DEBT INSTRUMENTS

* * * * *

The eligibility of a Trust for listing is

subject to the following:

(a) no change

(b) no change

(c) [Trustees—See § 118A(a).

(d)] Voting—When a share or unit has been

divided into separate components, any voting

rights accorded the share or unit may be

divided between the component securities as

specified in the Trust prospectus.

([e]d) Listing Agreement—See § 118A([h]g).

CONFLICTS OF INTEREST

Sec. 120. POLICIES—CONFLICTS OF

INTEREST, INDEPENDENT DIRECTORS

AND VOTING RIGHTS (§§ 120–126)

[The existence of material conflicts of

interest between companies and their

officers, directors or principal shareholders

(or members of their families or concerns

controlled by, or affiliated with, them) will

be reviewed by the Exchange in considering

the eligibility of companies for original

listing. In many cases, companies are able to

eliminate conflict situations prior to listing or

within a reasonable period after listing, and

may be asked to do so. Where a conflict

cannot be resolved promptly for sound

business reasons, the Exchange will consider

all pertinent factors.]

Each company shall conduct an

appropriate review of all related party

transactions on an ongoing basis and shall

utilize the company’s Audit Committee or a

comparable body of the Board of Directors for

the review of potential conflict of interest

situations where appropriate.

* * * * *

Sec. 125. REMEDIES AVAILABLE TO

BONDHOLDERS UPON DEFAULT

no change

* * * * *

OTHER REQUIREMENTS (§§ 130–134)

Sec. 130. ORIGINAL LISTING

APPLICATIONS

Applicants must register the security to be

listed under Section 12(b) of the Exchange

Act (§ 210) and submit an original listing

application (§ 211). [Before doing so, they

should first obtain a preliminary opinion as

to eligibility (§ 202) which the Exchange will

furnish without charge.]

* * * * *

Sec. 132. LISTING AGREEMENTS

In addition to meeting the foregoing

criteria, companies applying for listing enter

into agreements with the Exchange and

become subject to its rules, regulations and

policies applicable to listed companies.

Among other things, listed companies are

required to:

* * * * *

(e) [Transfer Facilities, Certificates—

Establish facilities or agencies for the transfer

and registry of stock and the payment of

principal and interest on, and the registry or

exchange of, bond or debenture issues

(§§ 801–841.) Requirements for engraving

and the form of certificates for listed

securities are also described in these

sections;

* * * * *

(g)]) Additional Information—upon

request, furnish to the Exchange such

information concerning the Company as the

Exchange may reasonable require.

* * * * *

LISTING FEES (§§ 140–146)

Sec. 140. ORIGINAL LISTING FEES

* * * * *

Special Shareholder Rights Plans

[A processing fee of $1,000 will be charged

for special shareholder rights plans in lieu of

the fees set forth in the above schedules, so

long as such rights are neither exercisable nor

tradable as a separate security.]

Upon the shareholder rights becoming

exercisable and tradabale separately:

• an original fee will be charged based on

the number of shareholder rights then

outstanding and on additional issuance of

rights[, less the $1,000 processing fee;]

• shareholder rights will be subject to the

Exchange’s continuing annual fee schedule.

Sec. 141. ANNUAL FEES

Stock Issues

* * * * *

The annual fee is payable in January of

each year and is based on the total number

of all classes of shares ([including] excluding

treasury shares) and warrants [outstanding at]

according to information available on

Exchange records as of December 31 of the

preceding year. (The above fee schedule also

applies to companies whose securities are

admitted to unlisted trading privileges.)

In the calendar year in which a company

first lists, the annual fee will be prorated to

reflect only that portion of the year during

which the security has been admitted to

dealings and will be payable in December

based on the total number of outstanding

shares of all classes of stock at the time of

original listing.

* * * * *

Sec. 144. REFUNDS OF LISTING FEES (see

also § 141 above)

(a) Applications Withdrawn or Not

Approved—If a listing application is not

approved by the Exchange or is withdrawn

by the applicant, a service charge of

$[250]1,000 is deducted by the Exchange

from the listing fee previously paid by the

applicant, and the balance is refunded to it.

[If an applicant refiles an application after

such a service charge has been deducted, the

amount deducted is applied as a credit to the

listing fee payable on the refiling, with the

understanding that if the application is again

withdrawn or not approved, a further service

charge of $250 will be deducted. This

procedure applies to all further refilings.]

(b) Credits After Approval—No cash refund

of a listing fee is made where an application

has been finally approved by the Exchange.

If additional unissued shares are authorized

for addition to the list ‘‘upon official notice

of issuance’’ and all of such shares are not

issued for the purpose specified in the

application, a credit is allowed. The credit

may be applied in full or partial payment of

fees payable for future listing applications of

the same company. The amount of the credit

is the difference between the fee paid for the

listing of such authorized shares and the fee

which would have applied had the

applications been initially submitted for the

number of shares, which were actually issued

and added to the list under the same listing

authorization. If a company cancels all listing

authorization pursuant to any single

application (see § 350), without the issuance

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6651

of any such shares, the Exchange makes a

minimum charge of $[250]1,000.

* * * * *

PART 2. Original Listing Procedures

(§§ 201–222)

GENERAL (§§ 201–207)

Sec. 201. STEPS

There are normally [eight] seven steps in

the listing process:

(a) [company request preliminary listing

eligibility opinion and receives favorable

opinion;]

(b)–(h) reclassified as (a)–(g)

[Sec. 202. PRELIMINARY OPINION PRIOR

TO PREPARATION OF COMPLETE

LISTING APPLICATION

An applicant should obtain an informal

and confidential opinion as to the eligibility

of a particular issue for listing before

preparing and filing a complete listing

application. There is no charge for such

opinion. The opinion may be obtained by

sending the following data to the Exchange:

(a) three copies of the latest prospectus and

proxy statement of the company (if

available);

(b) three copies of printed annual reports

distributed to shareholders for the last fiscal

year and one copy of the annual report for

preceding two years (if available) or financial

statements for such years; five copies of SEC

Form 10–K for latest fiscal year (if available);

five copies of SEC Form 10–Q (if available)

for interim periods since end of latest fiscal

year; and one copy of each SEC Form 8–K

filed since the latest Form 10–K;

(c) a certificate showing the extent of the

public distribution of the stock, to be

furnished on a printed form (Listing Form 2)

supplies by the Exchange;

(d) information with respect to personal

interests of any officers, directors or principal

shareholders in any business arrangements

involving the company such as the leasing of

property to or from the company, interests in

minority-held subsidiaries, interests in

businesses that are competitors, suppliers or

customers of the company, loans to or from

the company, if not included in Form 10–K

prospectus or proxy statement; and

(e) information concerning material

pending litigation if not included in Form

10–K, prospectus, or proxy statement.]

[Sec. 203. TIME SCHEDULE

A preliminary listing eligibility opinion is

normally rendered within one to two weeks

after the opinion is requested. An additional

two weeks is normally required for the

complete processing of an application.]

* * * * *

Sec. 207. [Corporate Relations Manager]

Listing Qualifications Analyst

Each company is assigned to a [Corporate

Relations Manager] Listing Qualifications

Analyst, who serves as the principal liaison

between the Exchange and the company on

all regulatory and disclosure-related matters.

PREPARATION OF ORIGINAL LISTING

APPLICATIONS (§§ 210–218)

* * * * *

Sec. 211. ORIGINAL LISTING

APPLICATION—GENERAL

(a) [Initial Submission] form—[No prepared

or blank forms are available for the listing

application itself. The applicant prepares its

own application, in typewritten narrative

form, following the instructions outlined

below. The Exchange will provide an

appropriate sample application and assist in

its preparation.]

A [preliminary] typewritten [draft of the]

listing application (signed by an executive

officer of the applicant), together with all

appropriate attachments, as outlined below,

and one copy only of each of the required

exhibits, should be [initially] filed with the

Exchange for examination. If any deficiencies

are noted, or any changes are considered

necessary in the form or contents of the

application and exhibits, the applicant will

be notified.

(b) Incorporation by Reference—A copy of

the following documents should be attached

to each original listing application submitted

and the information contained therein may

be incorporated by reference (see § 212, Item

2):

(i) no change

(ii) no change

(iii) no change

(iv) [a certificate showing the extent of the

public distribution of the stock, to be

furnished on a printed form (Listing Form 2)

supplied by the Exchange; and

(v) information concerning material

pending litigation if not included in Form

10–K, prospectus, or proxy statement; and

(vi) a statement that there have been no

material developments since the date of the

latest SEC filing; and

(vii)] such other information, documents or

materials as may be deemed appropriate by

the Exchange for inclusion in the applicant’s

listing application.

(c) Listing Fee—A check drawn to the order

of ‘‘American Stock Exchange’’ should

accompany the [initial] submission. (See

§ 140 for computation of amount.)

(d) Accounting Review—no change

[(e) Final Application—The listing

application need not be printed. Three (3)

final copies of the application (with

attachments listed in (b) above) shall be

submitted with each copy manually signed

by a duly authorized officer of the applicant.]

Sec. 212. CONTENT OF ORIGINAL LISTING

APPLICATION—STOCK

[An application for original listing of a

stock issue shall recite, in substantially the

order given below, the following:

Item 1. Title Page, showing:

(a) name of the applicant, address and

telephone number of principal executive

officer; and

(b) date of application and formal request

for listing; specifying the amount, class and

par value of the security applied for.

Application shall be made to list only that

part of an issue which is actually issued,

including both outstanding and treasury

shares. If an additional unissued amount is

reserved for issuance for a specific purpose,

application may also be made for authority

to add that amount to the list, upon official

notice of issuance for that specific purpose.

The request for authority to list such

additional amount should state briefly, but

specifically, the purpose of issuance, and that

the listing authorization of such shares is

effective only if they are issued for that

purpose. No additional unissued amount

may be applied for, which is not reserved for

issuance for a specific purpose by the Board

of Directors.

If the applicant has any other classes of

stock which are not being listed, the

application should indicate how many such

shares are outstanding, how many such

shares are reserved for future issuance and

the purpose thereof.

Item 2, Attachments. A statement listing

the appropriate documents which are

attached to the listing application and

incorporated therein by reference (see § 211)

and a statement that there have been no

material developments since the date of the

latest SEC filing.

Item 3. Certificate. Certificate and

signature of duly authorized officer of the

applicant.]

Each company must submit an application

for original listing, in the form prescribed by

the Exchange, together with supporting

exhibits specified in § 306 (See sample

application in Appendix). 

Sec. 213. EXHIBITS TO BE FILED WITH

ORIGINAL LISTING APPLICATION-STOCK

[The following exhibits must be filed i] In

support of the original listing application, a

company must file:

[1. Listing Agreement. O] one copy of the

Listing Agreement, executed by an executive

officer of the applicant, on Listing Form 1

supplied by the Exchange. In addition,

[2. Certificate of Distribution. One copy,

signed by an executive officer of the

applicant, as of a recent date, prepared on

Listing Form 2 supplied by the Exchange.

3. Charter. One copy each of charter and

all amendments to date, with (manually

signed) certificate(s) of Secretary of State or

corresponding authority covering filing of the

original charter and each amendment. In lieu

of the foregoing, the applicant may submit a

copy of the charter as amended to date, with

(manually signed) certificate(s) of Secretary

of State or corresponding authority with

respect thereto. Photostatic copies are

acceptable.

4. By-Laws. One copy of the by-laws, as

amended to date of application, certified by

the secretary or other executive officer of the

applicant.

5. Specimen Certificates. One specimen

copy of each denomination of certificate of

class to be listed. If transfer agents(s) and

registrar(s) are located in more than one city,

furnish one specimen of each denomination

of certificates used in each city. Specimens

should he accompanied by certificate and

agreement of the banknote company as

specified under requirements for ‘‘Form of

Securities-Engraving’’ in the attached

Appendix.

6. Opinion of Counsel. One copy of

opinion of counsel of satisfactory standing,

addressed to the Exchange, as to the

following: (a) the legality of organization and

valid existence of the applicant; (b) the

validity of authorization and issuance (or

6652 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

proposed issuance) of the securities applied

for; (c) whether the securities are (or will be)

fully paid and non-assessable, and whether

personal liability attaches to ownership; and

(d) whether the outstanding securities were

registered or issued pursuant to an

exemption under the Securities Act.

If counsel, or any partner of such counsel

(or, if a firm, any member thereof) is an

officer, director or shareholder of the

applicant, this fact must be disclosed in the

opinion and in the listing application.

7. Contract With Transfer Agent. One copy

of contract with each transfer agent relative

to the issuance of additional shares. (Use

printed Listing Form 3 supplied by the

Exchange.)

8. Contract With Registrar. One copy of

contract of each registrar relative to the

registration of additional shares. (Use printed

Listing Form 4 supplied by the Exchange.)

9. Other Information. T] the Exchange may

request copies of such other documents as

are necessary to complete its review of an

issuer’s eligibility for listing.

Sec. 214. OIL AND GAS AND MINING

COMPANIES—ADDITIONAL PAPERS TO

BE FILED

Oil and Gas Companies—In addition to the

[E] exhibits [1 to 9] required of all applicants,

companies which have an interest in oil and

gas properties as a material part of their

business must submit the following:

[10.] Engineer’s Reserve Report. Report of

recent date, of qualified engineer, including

estimate of proven reserves. The report shall

be accompanied by a signed statement of the

engineer’s qualifications. The Exchange

recommends and may, in fact, require the

submission of the report of a qualified

independent engineer not in the regular

employ of the company.

Mining Companies—In addition to the [E]

exhibits [1 to 9] required of all applicants,

companies which own or operate mines as a

material part of their business must submit

the following:

[11.] Table of Lands. A tabular list of

mineral and other lands (separate lists for

producing and non-producing properties),

each property designated by number or claim

name. If any property is held under lease,

specify terms. Submit separate lists for

properties held directly and those held

through subsidiaries.

[12.] Engineer’s Mining and Reserve

Report. Report, of recent date, of qualified

engineer. The report shall be accompanied by

a signed statement of the engineer’s

qualifications. (In certain cases, the Exchange

may require the submission of the report of

a qualified independent engineer not in the

regular employ of the applicant.)

In the case of mines which are developing,

the engineer’s report must contain:

(a) recommendations regarding the

development program; (by estimate as to

amount of additional funds which will be

required to complete the development

program as outlined; and (c) estimate of

length of time required to complete such

development program.

* * * * *

[Sec. 216. EXHIBITS TO BE FILED WITH

ORIGINAL LISTING APPLICATION—DEBT

SECURITIES

Applicants with no securities currently

listed on the Exchange should submit all

exhibits specified in § 213, except for

Exhibits 2, 6, 7 and 8, in lieu of which the

following should be submitted:

13. Opinion of Counsel. One copy of

opinion of counsel of satisfactory standing,

addressed to the Exchange, as to the

following: (a) the legality of organization and

valid existence of the applicant; (b) the

validity of authorization and issuance of the

bonds; (c) the legal, valid and binding nature

of the obligations enforceable against the

applicant in accordance with the terms of the

instrument creating such bonds, with

remedies exceptions, if appropriate; and (d)

whether the Indenture is qualified under the

Trust Indenture Act of 1939. If the bonds are

convertible into equity securities of the

applicant, an opinion should be given that

the securities in to which the bonds are

convertible have been duly and validly

authorized and reserved for issuance and that

they will, when issued, be fully paid and

non-assessable, and that no personal liability

will attach to ownership. The opinion should

also indicate whether the bonds and, if

applicable, the securities into which they are

convertible, will be registered or issued

pursuant to an exemption under the

Securities Act.

If counsel, or any partner of such counsel

(or, if a firm, any member thereof) is an

officer, director or shareholder of the

applicant, this fact must be disclosed in the

opinion and in the listing application.

14. Indenture. One copy of the mortgage,

indenture, or equivalent instrument, certified

by the trustee.

15. Trustee’s Certificate. A certificate from

the trustee showing acceptance of the trust.

(See Appendix for suggested form.)

Applicants with securities already listed

on the Exchange should file supporting

Exhibits 13–15 above, as well as Exhibits 1

and 5 set forth in § 213.]

* * * * *

[Sec. 218. EXHIBITS TO BE FILED WITH

ORIGINAL LISTING APPLICATION—

WARRANTS

Applicants with no securities currently

listed on the Exchange should submit all

Exhibits specified in §§ 213–214, except for

Exhibits 6, 7 and 8, in lieu of which the

following should be submitted:

16. Opinion of Counsel. One copy of

opinion of counsel of satisfactory standing,

addressed to the Exchange, as to the

following: (a) the legality of organization and

valid existence of the applicant; (b) the

validity of authorization and issuance of the

warrants; and (c) the legal, valid and binding

nature of the obligations enforceable against

the applicant in accordance with the warrant

agreement, with remedies and exceptions, if

appropriate. An opinion should be given that

the securities for which the warrants are

exercisable have been validly authorized and

reserved for issuance and that they will,

when issued in accordance with the warrant

agreement, he validly issued, fully paid and

non-assessable, and that no personal liability

will attach to ownership. The opinion should

also indicate whether the warrants and the

securities into which they are exercisable

will be registered or issued pursuant to an

exemption under the Securities Act.

If counsel, or a partner of such counsel, is

an officer, director or shareholder of the

applicant, this fact must be disclosed in the

opinion and in the listing application.

17. Contract with Warrant Agent. One

copy of contract from warrant agent(s) on

printed Listing Form 5.

18. Warrant Agreement. One certified copy

of warrant agreement between the issuer and

warrant agent(s).

In the case of applicants with securities

already listed on the Exchange, the

supporting Exhibits shall consist of 16, 17,

and 18 referred to above, plus Exhibits 1, 2

and 5 specified in § 213.]

FOREIGN LISTINGS (§§ 220–222)

* * * * *

Sec. 222. EXHIBITS TO BE FILED WITH

ORIGINAL LISTING APPLICATION—

FOREIGN ISSUERS

Generally, the exhibits to be filed in

support of an original listing application of

a foreign issue will be substantially the same

as those pertaining to an equivalent domestic

issue. [See §§ 213, 216 and 219.)]

Where an application is made to list ADRs,

rather than the underlying securities, a copy

of the Deposit Agreement and a specimen

ADR certificate should also be filed in

support of the listing application.

PART 3. Additional Listings-Requirements

and Procedures—Subscription Rights—

Possible Application of Original Listing

* * * * *

Sec. 304. LISTING OF SHARES PURSUANT

TO A STOCK DIVIDEND OR FORWARD

SPLIT

Stock to be issued in a forward split or

dividend must be listed prior to the

distribution date of such action. A company

must complete the Reconciliation Sheet

provided in the Exchange’s form of

application, as of the record date of the

scheduled distribution.

If fractional shares are to be paid in cash

and the exact number of shares cannot be

determined in advance, the company should

list the maximum number of shares that can

be issued and subsequently request

cancellation of the listing of the balance of

shares not issued.

[EXHIBITS—Exhibits A–2 and A–3

(described in § 306) must be submitted in

connection with a stock dividend or forward

split listing application.]

Sec. 305. LISTING OF SHARES PURSUANT

TO A REVERSE SPLIT/SUBSTITUTION

LISTING

A substitution listing application is

necessary whenever a company engages in a

reverse stock split, re-incorporates, proposes

to list a new class of securities in substitution

for a previously listed class of securities or

otherwise engages in a transaction which

would require it to file a new Form 8–A [or

Form 8–B] with SEC in regard to a previously

listed security.

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6653

[EXHIBITS—Exhibits A–2, A–3, A–4, A–7,

If applicable). A–8 and –9 (except in the case

of a reverse split) (described in § 306) must

be submitted in connection with a reverse

split or substitution listing application. In

addition, if a company is changing its

transfer agent and/or registrar a new Listing

Form 3 (Agreement With Transfer Agent)

and/or Listing Form 4 (Agreement With

Registrar) must be executed and filed with

the Exchange (see forms in Appendix).

If a company is listing debt securities in

substitution for a previously listed debt issue,

it is also required to submit: (i) a specimen

certificate of each denomination of security

to be listed, with certification from the

banknote company as specified in § 823; (ii)

a copy of the mortgage, indenture, or

equivalent instrument (or amendments

thereto) certified by the trustee with

amendments; and (iii) a certificate from the

trustee showing acceptance of the trust (see

Sample Trustee’s Certificate in Appendix).

If a company is listing warrants in

substitution for a previously listed warrant

class, it is also required to submit: (i) a

specimen certificate of each denomination of

security to be listed, with certification from

the banknote company as specified in § 823;

(ii) a copy of the contract with each warrant

agent on Listing Form 5 (see form in

Appendix); and (iii) a certified copy of the

warrant agreement.]

Sec. 306. EXHIBITS TO BE FILED WITH

ADDITIONAL LISTING APPLICATIONS

A–1 Contract. A copy of each executed

contract, plan or agreement pursuant to

which the additional securities applied for

are to be issued.

A–2 [Opinion of Counsel. An opinion of

counsel of satisfactory standing addressed to

the Exchange as to the following: (a) the

validity of authorization and issuance (or

proposed issuance) of the securities applied

for; (b) whether the securities are (or will be)

fully paid and non-assessable, and whether

personal liability attaches to ownership; and

(c) whether the securities to be listed will be

registered or issued pursuant to an

exemption under the Securities Act. If such

counsel, (or, if a firm, any member thereof)

is an officer, director or stockholder of the

applicant, this fact must be disclosed in the

opinion.

A–3 Board Resolutions. One certified copy

of each resolution of the Board of Directors

authorizing the issuance for which the listing

application is being made, and

A–4. Amendments to Charter. One copy of

each amendment to the charter not

previously filed with the Exchange, or, at the

applicant’s option, one copy of the charter as

amended to date, certified by the Secretary of

State or corresponding authority of the state

of incorporation.

A–5] Financial Statements of Acquired

Company. If the securities to be listed are to

be issued in connection with the acquisition

of a controlling interest in, or of substantially

all of the assets subject to the liabilities of,

another company, the most recent audited

financial statements, supplemented by the

latest interim statements. In cases where

independently audited financial statements

are not available, a manually signed

statement certified by the chief accounting

officer of such other company must be

submitted.

A–[6]3. Engineering Report. If the

securities applied for are to be issued in

acquisition of a stock interest in another

company, or properties or other assets,

furnish one copy of any engineering,

geological or appraisal report which may

have been obtained in connection with the

proposed acquisition.

[A–7. Amendments to By-Laws. One

certified copy of each amendment to the bylaws not previously filed with the Exchange.

If desired, there may be filed in lieu of such

amendments, one certified copy of the bylaws as amended to date.

A–8. Stock Certificates. If the form of stock

certificate for the listed class of stock has

been or is to be changed, furnish one

specimen of each denomination of the

changed form, with a certification from the

banknote company that the security has been

prepared in accordance with the printing and

engraving requirements of the Exchange, as

specified in § 823.]

A–[9]4. Listing Agreement. A company

must execute a new listing agreement (see

Listing Form 1) in support of every

substitution listing except in the case of a

reverse split.

* * * * *

SUBSCRIPTION RIGHTS, BACKDOOR

LISTING AND PAIRED SECURITIES

(§§ 340–343)

Sec. 340. SUBSCRIPTION RIGHTS

A listed company must promptly disclose

any action taken by it with respect to the

allotment of rights to subscribe or rights or

benefits pertaining to the ownership of its

listed securities. It is further required to give

prompt notice of any such action to the

Exchange to afford the holders of such

securities a proper period within which to

record their interests and exercise their

rights. These requirements are further

explained in paragraphs (a) through (h)

below.

The Exchange will not admit subscription

rights to dealings unless the underlying

security is or will be listed on the Exchange.

(a) No change

(b) Establishment of Record, Mailing, and

Expiration Dates—The record date should be

no earlier than one day prior to the time the

registration statement or offering circular

becomes effective.

The mailing of the subscription rights to

shareholders should occur as soon after the

record date as possible. Most companies have

their transfer agents mail the rights on the

same date as the record date or, at the latest,

on the business day following the record

date.

The subscription period should be for at

least 14 calendar days following the mailing

date. [provided the subscription agent is

located in New York City. If the transfer

agent (which usually also acts as the

subscription agent) is not located in New

York City or does not have a New York City

‘‘drop’’ (see § 801), such additional number

of days as is equal to the mailing distance

between New York City and the location of

the subscription agent should be added to the

14 day period. For example, if the sole

subscription agent is located in Boston,

without ‘‘drop’’ facilities in New York City,

the subscription period should be at least 15

days; in Chicago 16 days; and on the Pacific

Coast 18 days. Companies not having a New

York City transfer agent (or the equivalent

thereof) should consider the advisability of

appointing a New York City banking

institution to act as subscription agent or cosubscription agent to facilitate the handling

of subscriptions in relationship to the

minimum subscription period involved.] (See

§§ 510–522 for further explanation of ‘‘exrights’’ rule.)

(c) No change

(d) No change

(e) Dealings in Rights—No application is

required to be filed with the Exchange for the

listing of subscription rights or with the SEC

for their registration under the Exchange Act.

Under SEC Rule 12a–4, subscription rights

are exempt from registration under the

Exchange Act. [Listed companies must,

however, issue all transferable rights or

benefits pertaining to listed securities in a

form approved by the Exchange and make the

same assignable, exercisable and deliverable

in the Borough of Manhattan, City of New

York.]

Transferable rights may be admitted to

dealings on the Exchange as soon as notice

is received that the company’s Securities Act

registration statement or offering circular has

become effective. The normal procedure is to

admit the rights to dealings at 10:00 a.m. on

the day following the day the registration

statement or offering circular has become

effective. Accordingly, the company should

arrange to have the registration statement or

offering circular declared effective as of 4:00

p.m. on the date preceding the anticipated

trading date. The company or its attorneys

should notify the Exchange by telephone as

soon as they learn of SEC clearance.

Trading in rights on the Exchange will

cease at the close of business on the business

day preceding the expiration date thereof, if

such rights are exercisable in the New York

City metropolitan area, and at such time in

advance of the expiration date as may be

announced by the Exchange, if such rights

are exercisable outside such area. (Exchange

Rule 17.) This facilitates open contracts to be

settled and rights to be exercised on the final

day.

(f) Ex-Rights Date—As specified at § 513(a),

in general, stocks are quoted ‘‘ex-rights’’ the

day following the date on which the rights

are admitted to dealings. (Exchange Rule

830.) This arrangement allows one full day’s

trading to take place in the rights to establish

their market value for ‘‘ex-rights’’ purposes.

On the day the stock is quoted ‘‘ex-rights’’ all

open orders to buy and open stop orders to

sell (pursuant to Exchange Rule 132, as

amended) on the books of the specialist are

reduced by the cash value of the rights as

determined by the price of the last sale in the

rights the day before the stock sells ex-rights.

Purchasers of the stock beginning the fourth

business day preceding the record date for a

stock transferring in New York City [(and

earlier if the stock transfers only outside of

New York City)] and to and including the day

6654 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

before the ‘‘ex-rights’’ date for the stock have

been paying prices for their stock which

include the value of the rights. Since it is not

possible for such purchasers to become

holders of record on the books of the

company by the record date for the offering,

the Exchange rules that the purchasers in

such transactions (having paid a ‘‘rights on’’

price for their stock, i.e., a price including

the value of the rights) are entitled to the

rights and are, therefore, entitled to receive

a due bill for the rights from the sellers of the

stock. Such due bills are redeemed by the

sellers when they receive their rights from

the company.

This arrangement is between the brokers

for the purchasers and the sellers of the

stock, and does not involve the company. For

a further explanation, see §§ 510–522.

(g) No change

(h) No change

* * * * *

[Sec. 343. SPECIAL SHAREHOLDER

RIGHTS PLANS

The Exchange should be consulted prior to

the submission of any application involving

securities with special shareholder rights.

(See § 140 for discussion of the fee.)]

* * * * *

PART 4. Disclosure Policies (§§ 401–405)

DISCLOSURE (§§ 401–405)

Sec. 401. OUTLINE OF EXCHANGE

DISCLOSURE POLICIES

The Exchange considers that the conduct

of a fair and orderly market requires every

listed company to make available to the

public information necessary for informed

investing and to take reasonable steps to

ensure that all who invest in its securities

enjoy equal access to such information. In

applying this fundamental principle, the

Exchange has adopted the following six

specific policies concerning disclosure, each

of which is more fully discussed (in a

Question and Answer format) in § 402:

(a) Immediate Public Disclosure of Material

Information—A listed company is required to

make immediate public disclosure of all

material information concerning its affairs,

except in unusual circumstances. When such

disclosure is to be made during trading

hours, it is essential that the [company’s

Corporate Relations Manager] Stock Watch

Department be notified prior to the

announcement.

(b)–(f) no change

Sec. 402. EXPLANATION OF EXCHANGE

DISCLOSURE POLICIES

(a) Immediate Public Disclosure of Material

Information

* * * * *

Q. When may a company properly

withhold material information?

A. Occasionally, circumstances such as

those discussed below may arise in whichprovided that complete confidentiality is

maintained-a company may temporarily

refrain from publicly disclosing material

information. These situations, however, are

limited and constitute an infrequent

exception to the normal requirement of

immediate public disclosure. Thus, in cases

of doubt, the presumption must always be in

favor of disclosure.

(i) no change

(ii) When the facts are in a state of flux and

a more appropriate moment for disclosure is

imminent.

Occasionally, corporate developments give

rise to information which, although material,

is subject to rapid change. If the situation is

about to stabilize or resolve itself in the near

future, it may be proper to withhold public

disclosure until a firm announcement can be

made, since successive public statements

concerning the same subject (but based on

changing facts) may confuse or mislead the

public rather than enlighten it.

For example, in the course of a successful

negotiation for the acquisition of another

company, the only information known to

each party at the outset may be the

willingness of the other to hold discussions.

Shortly thereafter, it may become apparent to

the parties that it is likely an agreement can

be reached. Finally, agreement in principle

may be reached on specific terms. In such

circumstances (and assuming the

maintenance of strict confidentiality), a

company need not issue a public

announcement at each stage of the

negotiations, describing the current state of

constantly changing facts, but may await

agreement in principle on specific terms. If,

on the other hand, progress in the

negotiations should stabilize at same other

point, disclosure should then be made if the

information is material.

Whenever material information is being

temporarily withheld, the strictest

confidentiality must be maintained, and the

company should be prepared to make an

immediate public announcement, if

necessary. During this period, the market

action of the company’s securities should be

closely watched, since unusual market

activity frequently signifies that a ‘‘leak’’ may

have occurred. This is one reason why it is

important to keep the company’s [Corporate

Relations Manager] Listing Qualifications

Analyst fully apprised of material corporate

developments.

Note: Federal securities laws may restrict

the extent of permissible disclosure before or

during a public offering of securities or a

solicitation of proxies. In such circumstances

(as more fully discussed below), a company

should discuss the disclosure of material

information in advance with the Exchange

and the Securities and Exchange

Commission. It is the Exchange’s experience

that the requirements of both the securities

laws and regulations and the Exchange’s

disclosure policy can be met even in those

instances where their thrust appears to be

different.

Q. What action is required if rumors occur

while material information is being

temporarily withheld?

A. If rumors concerning such information

should develop, immediate public disclosure

becomes necessary. (See also ‘‘Clarification

or Confirmation of Rumors and Reports’’ on

page 4–7.)

Q. What action is required if insider

trading occurs while material information is

being temporarily withheld?

A. Immediate public disclosure of the

information in question must be effected if

the company should learn that insider

trading, as defined in section 402(f), has

taken or is taking place. In unusual cases,

where the trading is insignificant and does

not have any influence on the market, and

where measures sufficient to halt insider

trading and prevent its recurrence are taken,

exemptions might be made following

discussions with the Exchange. The

company’s [Corporate Relations Manager]

Listing Qualifications Analyst, through the

facilities of the Exchange’s Stock Watch

Department, can provide current information

regarding market activity in the company’s

securities and help assess the significance of

such trading.

* * * * *

(b) Thorough Public Dissemination

Q. What specific disclosure techniques

should a company employ?

A. The steps required are as follows:

(i) Prior to Public Disclosure. The Exchange

expects a company to notify [its Corporate

Relations Manager] the Exchange’s Stock

Watch Department in advance of public

disclosure of information which is nonroutine or is expected to have an impact on

the market for its securities. The Exchange,

with the benefit of all the facts provided by

the company, will be able to consider

whether a temporary halt in trading, pending

an announcement, would be desirable. A

temporary halt in trading is not a reflection

on the company or its securities, but provides

an opportunity for disseminating and

evaluating the information released. Such a

step frequently helps avoid rumors and

market instability, as well as the unfairness

to investors that may arise when material

information has reached part, but not yet all,

of the investing community. Thus, in

appropriate circumstances, the Exchange can

often provide a valuable service to investors

and listed companies by arranging for such

a halt.

(ii) At Time of Public Disclosure. As a

minimum, any public disclosure of material

information should be made by an

announcement released simultaneously to:

[(A)] the national business and financial

news-wire services [(Dow Jones, Reuters, and

Bloomberg), (B) the national news-wire

services (Associated Press and United Press

International), (C) The New York Times and

The Wall Street Journal, and (D) Moody’s

Investors Service and Standard & Poor’s

Corporation. The New York telephone

numbers and addresses of these organizations

are as follows:

Dow Jones & Company, Inc. (The Wall Street

Journal), World Financial Center, 200

Liberty Street, New York, N.Y. 10281, (212)

416–2471

Reuters Ltd., 1700 Broadway, New York, N.Y.

10019, (212) 603–3300

Bloomberg Business News, 499 Park Avenue,

New York, N.Y. 10022, (212) 318–2000

Associated Press, 50 Rockefeller Plaza, New

York, N.Y. 10020, (212) 621–1500

United Press International, Five Penn Plaza,

New York, N.Y. 10001, (212) 560–1100

The New York Times, 229 W. 43rd Street,

New York, N.Y. 10036, (212) 556–1234

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6655

Standard & Poor’s Corporation, 25 Broadway,

New York, N.Y. 10004, (212) 208–8377

Moody’s Investors Service, Inc., 99 Church

Street, New York, N.Y. 10007, (212) 553–

0300

Concerns that distribute press releases over

private [teletype] networks may be extremely

helpful in gaining news coverage. Two such

organizations are PR Newswire, [150 E. 58th

St., New York, N.Y. 10022 [(212) 832–9400

or (800) 832–5522 (outside New York)],] and

Business Wire [, 1133 Avenue of the

Americas, New York, N.Y. 10036 [(212) 575–

8822 or (800) 221–2462 (outside New York)]].

Companies may also wish to broaden their

distribution to other news or broadcast

media, such as those in the location of the

company’s plants or offices, and to trade

publications. The information in question

should always be given to the media in such

a way as to promote publication by them as

promptly as possible, i.e., by telephone,

telecopy, or in writing (by hand delivery), on

an ‘‘immediate release’’ basis. Companies are

cautioned that some of these media may

refuse to publish information given by

telephone until it has been confirmed in

writing or may require written confirmation

after its publication.

Whenever difficulty is encountered or

anticipated in having an announcement

about a material development published, a

company should contact [its Corporate

Relations Manager who may frequently] The

Exchange’s Stock Watch Department, which

may be able to provide assistance. Finally, if

despite all reasonable efforts, the

announcement has not been published by

one of the national news-wire services or one

of the above-mentioned newspapers, the

company should attempt to have the

announcement disseminated through other

media, such as trade, industry or business

publications, or local newspapers (especially

those in the area where the company’s

principal offices or plants are located or

where its stockholders are concentrated). In

cases where the announcement is of

particular importance, or where unusual

difficulty in dissemination is encountered,

the company should consider the use of paid

advertisements, a letter to stockholders, or

both.

Companies may also disseminate

information over the Internet. Information

should not be made available over the

Internet before the same information is

transmitted to, and received by, the

traditional news vendor services.

Three copies of all public announcements

should be sent to the Exchange.

[Announcements can be telecopied to the

Exchange at (212) 306–1488.]

Q. How does the policy on thorough public

dissemination apply to meeting with

securities analysts, journalists, stockholders

and others?

* * * * *

(c) Clarification or Confirmation of Rumors

and Reports

no change

(d) Response to Unusual Market Action

Q. What is the significance of unusual

market activity from the standpoint of

disclosure?

A. Where unusual market action (in price

movement, trading activity, or both) occurs

without any apparent publicly available

information which would account for the

action, it may signify trading by persons who

are acting either on unannounced material

information or on a rumor or report, whether

true or false, about the company. Most often,

of course, unusual market activity may not be

traceable either to insider trading or to a

rumor or report. Nevertheless, the market

action itself may be misleading to investors,

who are likely to assume that a sudden and

appreciable change in the price of a

company’s stock must reflect a parallel

change in its business or prospects.

Similarly, unusual trading volume, even

when not accompanied by a significant

change in price, tends to encourage rumors

and give rise to speculative trading activity

which may be unrelated to actual

developments in the company’s affairs.

Generally, unusual market activity will

first be detected by either the Specialist in

the company’s securities or the Exchange’s

Stock Watch Department[. This information

will then be passed on to the company’s

Corporate Relations Manager, who], which in

turn, will contact company officials to

apprise them of the activity.

* * * * *

Sec. 403. CONTENT AND PREPARATION

OF PUBLIC ANNOUNCEMENTS

(a) Exchange Requirements

no change

(b) Securities Laws Requirements—The

requirements of the Federal securities laws

must also be carefully considered in the

preparation of public announcements. In

particular, these laws may impose special

restrictions on the extent of permissible

disclosure before or during a public offering

of securities or a solicitation of proxies.

Generally, in such circumstances, while the

restrictions of the securities laws may affect

the character of disclosure, they do not

prohibit the timely disclosure of material

factual information. Thus, it is normally

possible to effect the disclosure required by

Exchange policy.

[Whenever a conflict arises, the company

should discuss the matter with the Securities

and Exchange Commission, as well as with

its Exchange Corporate Relations Manager,

who can frequently assist in evaluating the

problem.]

(c) Preparation of Announcements—The

following guidelines for the preparation of

press releases and other public

announcements should help companies to

ensure that the content of such

announcements will meet the requirements

discussed above:

(ii) no change

(iii) Since skill and experience are

important to the preparation and editing of

accurate, fair and balanced public

announcements, the Exchange recommends

that a limited group of individuals within the

company be given this assignment on a

continuing basis. (Since a press

announcement usually must be prepared and

released as quickly as possible, however, the

group charged with this assignment should

be large enough to handle problems that arise

suddenly and unexpectedly.) The [company’s

Corporate Relations Manager] Exchange’s

Stock Watch Department can assist in

assessing whether the release satisfies the

Exchange’s disclosure requirements.

(iv) no change

Sec. 404. EXCHANGE SURVEILLANCE

PROCEDURES

[As previously noted, the Corporate

Relations Managers are primarily responsible

for the day-to-day relations with listed

companies. They are familiar with the affairs

of their assigned companies and are

connected by direct wire to the trading floor

of the Exchange. They also maintain close

contact with the Exchange’s Stock Watch

Department, which is responsible for

monitoring unusual market situations.]

In many cases, when unusual market

action occurs, [it is reported to the assigned

Corporate Relations Managers. In many cases,

by checking with] Stock Watch[, the

Corporate Relations Managers] is able to trace

the reason for the action to a specific cause,

such as recently disclosed information,

recommendations by advisory services, or

rumors. In certain instances, the Exchange’s

Market Surveillance Department may also be

asked to check brokerage firms as to the

source and reasons for activity stemming

from their particular firms. (This latter

information, it should be noted, must remain

confidential to the Exchange.) If no

explanation of the unusual activity is

revealed, [the Corporate Relations Managers]

Stock Watch may call officials of the

company to determine whether the cause of

the action is known to them. If the action

appears to be attributable to a rumor or

report, or to material information that has not

been publicly disseminated, the company is

requested to take appropriate corrective

action, and it may be advisable, after

consultation with trading floor officials, to

halt trading until such action has been taken.

[Sec. 405. CONSULTATION WITH

EXCHANGE CORPORATE RELATIONS

MANAGERS

A company expecting to make a material

corporate announcement should first contact

its Corporate Relations Managers who is in a

unique position to evaluate disclosure

problems as they arise and explain their

effect on the public, the company and the

Exchange. By means of such advance

consultation, effective liaison between

companies and the Exchange is maintained,

and a company can obtain the benefit of the

Representative’s experience in the day-to-day

application of the Exchange’s policies

relating to corporate disclosure.]

PART 5. Dividends and Stock Splits (§§ 501–

522)

NOTICES, RECORD DATE (§§ 501–509)

Sec. 501. NOTICE OF DIVIDEND

no change

Sec. 502. RECORD DATE

A company is not permitted to close its

stock transfer books for any reason, including

the declaration of a dividend. Rather, it must

establish a record date for shareholders

entitled. To a dividend which is at least ten

days after the date on which the dividend is

declared (declaration date). [However, in the

6656 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

case. Of stock issues that do not have transfer

facilities in the New York City metropolitan

area, the record date shall not be less than

such number of additional days (in excess of

ten) after the declaration date as is equal to

the mailing time (regular mail) between New

York City and the city in which the Transfer

Agent is located.

Note: The requirement for additional time

between the declaration date and the record

date would also apply in cases where there

is an intervening holiday or where the record

date falls on a weekend.]

A company is also required to give the

Exchange at least ten days’ notice in advance

of a record date established for any other

purpose, including meetings of shareholders.

Sec. 503. FORM OF NOTICE

Immediately after the board of directors

has declared a cash or stock dividend, the

company should: (a) release the news to the

newspapers and news services, including the

news-ticker services operated by Dow Jones

& Company, Inc., and Reuters Ltd., (see

§ 402); and (b) notify the Exchange by

telephone[, telegram] or [telecopier] facsimile

and confirm by letter. The announcement

and notice should specify the name of the

company, date of declaration, amount (per

share) of the dividend, and the record and

payment dates.

* * * * *

EX-DIVIDEND-EX-RIGHTS (§§ 501–522)

Sec. 512. EX-DIVIDEND PROCEDURE

[In the establishment and announcement of

ex-dividend dates, the Exchange proceeds as

follows:

Transfer Facilities Located in New York

City] Transactions in stocks (except those

made for ‘‘cash’’) [for which there exist

transfer facilities in New York City (see

§ 801)] are ex-dividend on the second

business day preceding the record date. If the

record date selected is not a business day, the

stock will be quoted ex-dividend on the third

preceding business day. ‘‘Cash’’ transactions

are ex-dividend on the business day

following the record date.

* * * * *

[Sec. 520. SCHEDULE FOR CUSTOMARY

EX-DIVIDEND DATES

The ‘‘ex-dividend’’ date established by the

Exchange is based on the location of the

transfer facilities either in, or nearest to, New

York City. Thus, if an issue transfers both in

New York City and outside of New York City,

the ‘‘ex’’ date is based on the New York City

transfer facilities. If an issue does not transfer

in New York City, but transfers in two or

more cities outside of that area, the ‘‘ex’’ date

is based on the location of the transfer

facilities closest to New York City.

To avoid unnecessary claims for dividends,

members receiving deliveries of stocks

against ‘‘dividend on’’ transactions, are urged

to provide for the early mailing of such

stocks which transfer out of town, in order

to ensure receipt by the transfer agent by the

record date.]

Sec. 521. SPECIAL EX-DIVIDEND RULINGS

(a) no change

(b) no change

(c) ‘‘Cash’’ Transactions—The Ex-Dividend

Rule of the Exchange specifies that ‘‘cash’’

transactions (in which delivery of the

security must be made on the date of the

transaction) [in the case of stocks transferring

in the New York City Metropolitan area,]

shall be ‘‘ex-dividend’’ on the business day

following the record date[, and in the case of

stocks transferring only outside of that area

shall be ‘‘ex-dividend’’ on the business day

following the ‘‘equivalent New York record

date’’].

* * * * *

PART 6. According; Annual and Quarterly

Reports (§§ 603–624)

ACCOUNTING (§ 603, § 604)

Sec. 603. CHANGE IN ACCOUNTANTS

A listed company is required to notify its

[Corporate Relations Managers] Listing

Qualifications Analysis promptly (prior to

filing its 8-K) if it changes independent

accountants; and must state the reason for

such change.

* * * * *

INTERIM REPORTS (§§ 622–624)

[Sec. 622. REQUESTS FOR EXTENSION

A company should immediately notify its

Corporate Relations Manager whenever it

files with the SEC a request for extension of

time for the filing of its interim statements on

SEC Form 12b-25.]

* * * * *

PART 7. Shareholders’ Meetings, Approval

and Voting of Proxies (§§ 701–726)

SHAREHOLDERS’ APPROVAL (§§ 701–706)

* * * * *

[Sec. 702. CHARTER AND BY-LAW

AMENDMENTS

A listed company is required to file with

the Exchange a copy of any amendment to its

charter or by-laws (or equivalent documents),

as soon as it becomes effective. Such filing

must include:

(a) in the case of a charter amendment—

a certification by the Secretary of State (or

similar authority) that the filing is a true and

complete copy of the amendments; and

(b) in the case of a by-law amendment—

a resolution of the board of directors

(certified by an officer of the company)

authorizing the by-law amendment.]

* * * * *

SHAREHOLDERS’ APPROVAL (§§ 710–713)

* * * * *

Sec. 713. OTHER TRANSACTIONS

The Exchange will require shareholder

approval (pursuant to a proxy solicitation

conforming to SEC proxy rules) as a

prerequisite to approval of applications to list

additional shares to be issued in connection

with:

(a) a transaction involving:

(i) the sale, [or] issuance, or potential

issuance by the company of common stock

(or securities convertible into common stock)

at a price less than the greater of book or

market value which together with sales by

officers, directors or principal shareholders

of the company equals 20% or more of

presently outstanding common stocks; or

(ii) the sale, [or] issuance, or potential

issuance by the company of common stock

(or securities convertible into common stock)

equal to 20% or more of presently

outstanding stock for less than the greater of

book or market value of the stock; or

(b) a transaction which would involve the

application of the Exchange’s original listing

guidelines as described in § 341.

VOTING BY EXCHANGE MEMBERS,

TRANSMISSION OF PROXY MATERIALS

(§§ 720–726)

* * * * *

Sec. 726. VOTING BY SPECIALISTS (SEE

EXCHANGE RULE 186)

[An] Exchange specialists [is] are

prohibited from soliciting, directly or

indirectly, any proxy on behalf of [himself]

themselves or any other person in respect of

a security in which [he is] they are registered

as a specialist. [A specialist is] Specialists are

also prohibited from voting in any proxy

contest any such security in which [he has]

they have a beneficial interest.

[PART 8. Transfer Facilities; Certificate

Requirements (§§ 801–841)

TRANSFER AGENTS, REGISTRARS,

TRUSTEES (§§ 801–811)

Sec. 801. TRANSFER AND REGISTRY

FACILITIES

Listed companies are required to maintain

transfer and registry facilities (including

facilities for conversion or exchange) for their

listed securities, which are satisfactory to the

Exchange. Such transfer and registry facilities

may be located in New York City or outside

of New York City provided, in each case, that

the requirements of Rule 891 of the Board of

Governors of the Exchange, set forth below,

are met.

Board of Governors Rule 891:

Requirements in order to qualify as a

Transfer Agent for securities listed on the

American Stock Exchange (where the listed

Company does not act as its own Transfer

Agent) in respect of (i) all Transfer Agents

located in New York City, and (ii) Transfer

Agents located out-of-town where the listed

Company has no Transfer Agent in New York

City.

1. Office facilities (hereinafter referred to as

the ‘‘office’’) satisfactory to the Exchange and

the issuer to receive and redeliver securities

must be located south of Chambers Street in

the Borough of Manhattan, City of New York.

2. Routine transfers are to be processed and

available for pick-up at the office under

normal conditions within 48 hours, e.g., if

received before Noon on Monday must be

available for pick-up no later than

immediately after 1:00 P.M. on Wednesday.

3. The Transfer Agent must assume total

responsibility and liability for securities from

the time of deposit at the office until delivery

at the window. The Transfer Agent must

maintain insurance coverage of a least

$10,000,000 to protect securities while in

transit or in process of transfer, and it must

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6657

be in a position to demonstrate that it has a

substantial new worth. If the Transfer Agent

does not have capital, surplus (both capital

and earned), undivided profits and/or capital

reserves aggregating at least $3,000,000, it

will be required to furnish additional

evidence of its ability to meet financial

obligations and it may be required to

maintain insurance coverage in excess of

$10,000,000. In this regard, all relevant

factors will be considered such as its past

record of operations as a transfer agent, the

experience of its management and

supervisory personnel, its security and

record-keeping procedures, the nature and

scope of any other activities in which it is

engaged and the amount of its capital in

relation to its overall business activities.

4. Out-of-town agents having a drop in

New York must make appropriate

arrangements to pick up from and deliver to

Depositary Trust Company normally within

the 48-hour period and framework

mentioned above.

5. Personnel at the office must have

sufficient experience to respond promptly to

inquiries regarding transfers, including legal

items.

6. Securities received before the close

business at the office on a record date or any

other date involving the rights of a security

holder must be recorded as of the date so as

to establish the transferee’s rights.

7. Facilities should be available for

expediting transfer service when needed. No

objection will be made if a reasonable charge

is made for such special service.

8. The Exchange reserves the right to

request a company with securities listed on

the Exchange to terminate the appointment of

its transfer agent in the event of failure of

such transfer agent to conform to all of the

foregoing requirements.

Sec. 802. AGREEMENT WITH TRANSFER

AGENT

A company is required to cause its transfer

agent or agents to enter into an agreement

with the Exchange (Listing Form 3 for

common stock and Listing Form 5 for

warrants) whereby the transfer agent must

notify the Exchange 10 days after the close

of each calendar quarter of the number of

shares outstanding as of the last business day

of the calendar quarter for each security

listed on the Exchange. The transfer agent

must also notify the Exchange if its services

are discontinued.

Sec. 803. AGREEMENT WITH REGISTRAR

A company is also required to cause its

registrar or registrars to enter into an

agreement with the Exchange (Listing Form

4) whereby the registrar agrees to notify the

Exchange 10 days after the close of each

calendar quarter of the number of shares

registered for each security listed on the

Exchange. A registrar must also notify the

Exchange if its services are discontinued.

Sec. 804. ADDITIONAL TRANSFER AND

REGISTRY FACILITIES

Transfer and registry agencies maybe

maintained in more than one city. However,

when shares are transferred in more than one

transfer office, the combined amounts of

stocks registered in all transfer offices shall

not exceed the amount authorized for listing

(See also § 829.)

Sec. 805. ACTING IN DUAL CAPACITY

A qualified bank, trust company, listed

company or other qualified organization may

act in the dual capacities of transfer agent

and registrar, provided that it countersigns

stock certificates in both capacities. All

entities which act in the dual capacity of

transfer agent and registrar are required to

assure the Exchange that such functions are

maintained separately and distinctly with

appropriate internal controls, subject to an

annual review by the agent’s independent

auditors which shall be provided to the

entity’s board of directors.

A listed company acting in the dual

capacity of transfer agent and registrar for its

own securities shall be required to sign an

appropriate agreement with the Exchange to,

among other things:

1. maintain offices, staffed by qualified

personnel, with adequate facilities for the

safekeeping of securities in its possession

where transfer and registration may be

completed within forty-eight hours;

2. be responsible to indemnify purchasers

for any loss arising out of over/under

issuance of all securities delivered to, or

picked up by, it as agent, until such

securities are delivered pursuant to

instructions; and

3. maintain the transfer agent and registrar

functions as separate and distinct with

appropriate internal controls, such controls

to be reviewed annually by the company’s

independent auditors.

Sec. 806. COMPANY ACTING AS OWN

TRANSFER AGENT AND/OR REGISTRAR

If a security is transferred and/or registered

at the company’s office, the persons who

shall be authorized to sign certificates in the

capacity of registrar and transfer agent shall

be appointed by specific authority of the

board of directors and shall not be an officer

who is otherwise authorized to sign

certificates on the company’s behalf.

Note: A listed company which acts as

transfer agent and/or registrar for the

securities of another issuer must comply with

Exchange rules pertaining to unaffiliated

banks, trust companies or other organizations

(see Amex Rule 891).

Sec. 807. APPOINTMENT OF NEW AGENT

A company is not permitted to appoint a

transfer agent, registrar, or other fiscal agent

of a security of the company listed on the

Exchange without prior notice to and

approval of the Exchange. A registrar must,

at the time of its appointment, be acceptable

to the Exchange as a registrar for securities

listed on the Exchange.

Sec. 808. SPLIT-UP OF CERTIFICATES

AFTER CLOSING TRANSFER BOOKS

If the transfer books of a company should

be closed permanently, the company is

required to continue to split-up certificates

into smaller denominations in the same name

so long as such stock remains listed on the

Exchange.

Sec. 809. AGENT FOR REGISTRATION ON

BONDS OR DEBENTURES

A company applying for the listing (or

having listed) registered bonds or debentures

on the Exchange is required to maintain in

New York City (See § 801) an office or

agency, satisfactory to the Exchange, where

such bonds or debentures are registerable. In

the case of bonds or debentures issued in

bearer form, such office or agency must

provide for the payment of principal and

interest on such indebtedness.

Sec. 810. AGENT FOR PAYMENT OF

DIVIDENDS, INTEREST AND PRINCIPAL

A listed company is permitted to designate

an agent, satisfactory to the Exchange,

located in or outside New York City, for the

payment of dividends, interest and principal

(on bonds or debentures), and other

payments with respect to a listed security. If,

however, checks for such payments are

drawn on a bank located outside New York

City, additional arrangements must be made

for payment against such checks at a bank,

trust company or agency located in New York

City; and the details of those arrangements

disclosed to the payee.

Sec. 811. TRUSTEES FOR BOND ISSUES

(a) Trustee to be a bank or trust company—

The trustee of a bond issue must be a trust

company or banking institution having

substantial capital and surplus and the

experience and facilities for handling

corporate trust business. In cases where, for

any reason, an individual has been appointed

as trustee, a qualified trust company or

banking institution must be appointed cotrustee.

(b) Separate trustee for each issue—If the

company, either at the time of listing or

subsequently, should have bonds or other

evidences of indebtedness outstanding under

more than one mortgage, indenture or deed

or trust, each issue shall be represented by

a different trustee; provided, however, that

separate trustee shall not be required in the

case of several issues of bonds issued under

one or more indentures that have been

qualified under the Trust Indenture Act of

1939, as amended.

(c) Persons not acceptable as trustees—The

Exchange does not regard as satisfactory to

act as a trustee for a listed issue any: (i)

officer or director of the issuing company; (ii)

trust company, banking institution, or other

organization in which an officer of the

issuing company is an executive officer; or

(iii) organization controlled by, under

common control with, or which itself

controls, the issuing company.

(d) Changes in trustees—No change is to be

made in the trustee of a listed issue without

prior notice to and approval of the Exchange.

FORM OF SECURITIES-ENGRAVING

(§ § 820–830)

Sec. 820. REVIEW BY THE EXCHANGE

In addition to complying with the

requirements set forth below, companies

should submit the following to the Exchange

for review and approval:

(a) proofs of a security prior to final

printing; and

6658 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

(b) specimens of the security in final form,

printed on the bond paper to be used for the

definitive security, accompanied by the

banknote company agreement described in

§ 823. No change in the form of a certificate

should be made without the approval of the

Exchange.

Sec. 821. ENGRAVED BORDER

The face of listed securities (stocks and

bonds) must be printed from at least one

engraved steel border plate produced by a

banknote company whose work is acceptable

to the Exchange. The company may, at its

option, use a second steel engraved face

plate.

Sec. 822. BORDER PLATE ORIGINAL

The engraved border plate (and engraved

face plate, if used) must be original to the

banknote company which prepared the

security, and the name of such banknote

company must appear on the face of all

securities and also on the face of coupons

and filing panel of each bond.

The border plate shall remain in the

permanent possession of the banknote

company which produced it. The plate may

be used by such banknote company in the

production of ‘‘controlled stock’’ securities of

more than one company, provided that such

securities are prepared in their entirety on

the premises of such banknote company,

which shall furnish the Exchange with the

certificate and agreement described in § 823.

Sec. 823. AGREEMENT OF BANKNOTE

COMPANY

The final specimen submitted to the

Exchange must be accompanied by:

(a) a certificate of the banknote company

that:

(i) the security has been prepared in

accordance with the printing and engraving

requirements of the American Stock

Exchange; and

(ii) all work done in connection with the

preparation and manufacture of the dies,

rolls, plates and certificates has been and will

be done entirely on the premises of the

banknote company, except as may be

specifically noted (if there are any

exceptions, full details must be given);

(b) an agreement by the banknote company

(by its terms binding upon the banknote

company, its successors and assigns) that all

dies, rolls, plates and other engravings used

in connection with the manufacture of

certificates of the particular issue will, at all

times, be and remain in the possession of the

banknote company and, when not actually

being used in connection with the

manufacture and preparation of certificates,

will be kept in a vault on the premises of the

banknote company, and all completed

certificates of the issue and all certificates in

process will, prior to delivery to or upon the

order of the issuing company (except when

in actual process of manufacture), be kept in

such vault. (See Appendix for suggested

format.)

Sec. 824. COLOR

The printing of securities must be in

distinctive colors to make classes and

denominations readily distinguishable.

Sec. 825. PAPER-SIZE

All paper used for securities must be of an

excellent grade of bond paper, of adequate

weight and strong enough to withstand the

strains and stresses of frequent handling.

Stock certificates shall be of the standard size

of 8 × 12 inches.

Sec. 826. DENOMINATIONS

The Exchange has no requirements as to

denominations of stock certificates and

permits either the sole use of single

(unlimited) denomination certificates, or

certificates for 100 shares, less than 100

shares and unlimited denominations.

The denomination of 100 shares, less than

100 shares and more than 100 share

certificates should be appropriately indicated

on the certificate by engraving or surface

printing at the option of the company.

Companies which do not have a separate

certificate for more than 100 shares may alter

the certificate for 100 shares or for less than

100 shares by over-printing.

Certificates for other than 100 shares

should indicate the exact number of shares

by the use of a macerating machine that

breaks the paper or a matrix. A company may

also use a punchout panel in addition to one

of the methods noted above.

Sec. 827. PAR VALUE

The par value of common stock may be

eliminated from common stock certificates,

except where required by law. Par value may

also be eliminated from preferred stock

certificates, except where the dividend rate is

expressed as a percentage of par value.

Where a company elects to eliminate par

value from its stock certificates, an opinion

of counsel as to legality under applicable

state law and the company’s charter should

be filed with the Exchange. Where par value

is shown on certificates, either as the result

of legal requirements or a company’s

preference, it may be surface printed rather

than engraved.

Sec. 828. PREFERENCES

If the stock certificates of a company do not

recite the preference of all classes of its stock,

the company is required to furnish to its

shareholders, upon request and without

charge, a printed copy of preferences of all

classes of its stock. A reference to the

availability of such copy should appear on

such certificates.

Sec. 829. CERTIFICATES TRANSFERRED

IN MORE THAN ONE TRANSFER OFFICE

When shares are transferred in more than

one transfer office, certificates should be

interchangeably transferable and identical in

color and form, except as to names of transfer

agent and registrar, and the certificates shall

bear a legend naming all cities in which they

may be transferred.

Sec. 830. SUPPLY OF CERTIFICATES

A company is required to have on hand at

all times a sufficient supply of certificates to

meet the demands for transfer.

LOST CERTIFICATES, CUSIP NUMBERS

(§§ 840, 841)

Sec. 840. REPLACEMENT OF LOST

CERTIFICATES

A company is required to issue new

certificates for securities listed on the

Exchange replacing lost ones immediately

upon notification of loss and receipt of

proper indemnity.

In the event of the issuance of any

duplicate bond to replace a bond which has

been alleged to be lost, stolen or destroyed

and the subsequent appearance of the

original bond in the hands of an innocent

bondholder, either the original or the

duplicate bond will be taken up and canceled

and the company must deliver to such holder

another bond theretofore issued and

outstanding.

Sec. 841. CUSIP IDENTIFICATION

NUMBER

Certificates for listed securities are

required to have imprinted thereon the

appropriate CUSIP identification number

which is provided by Standard & Poor’s

Corp.

PART 9. Treasury Shares; Additional

Matters (§§ 901–994)

TREASURY SHARES, REDEMPTIONS AND

REPURCHASES (§§ 901–903)

* * * * *

Sec. 901. ACQUISITION OR DISPOSITION

OF TREASURY SHARES

A company is required to report to the

Exchange, within ten days after the close of

each fiscal quarter, any reacquisition or

disposition of its previously issued shares

listed on the Exchange made during the

quarter. Such reports are to include treasury

share transactions for the account of the

company, whether direct or indirect, and are

to show separate totals for acquisitions and

dispositions and the number of treasury

shares held by it at the end of the quarter.

A sample form of report is shown below:

American Stock Exchange

86 Trinity Place

New York, N.Y. 10006–1881

Dear Sirs: Pursuant to section 901 of the

Company Guide, this is to report that the

company effected transactions in shares of its

previously issued common stock, $1 par

value, during the quarter ended (date), as

follows:

Treasury shares held as of (date): 60,000

Shares reacquired during quarter ended

(date):

Total: 60,000

Shares disposed of during quarter ended

(date):

(Date)—Exercise of option: 2,000

(Date)—Exercise of option: 8,000

Total shares disposed of: 10,000

Balance as of (date): 50,000

Very truly yours,

XYZ COMPANY

Sec. 902. REDEMPTION, CANCELLATION,

RETIREMENT

A company is not permitted to select any

of its listed securities for redemption

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6659

otherwise than pro rata or by lot, and is

required to notify the Exchange at least 15

days in advance of any redemption and to

furnish it promptly with any information

requested in connection with the

redemption.

Bonds, debentures or preferred stocks

issued, or to be issued, under an indenture

or charter provision not conforming to this

requirement are not eligible for listing on the

Exchange.

A company is also required to notify the

Exchange promptly of any corporate action

which will result in the redemption,

cancellation or retirement, in whole or in

part, of any of its securities listed on the

Exchange, and to notify the Exchange as soon

as the company has notice of any other action

which will result in any such redemption,

cancellation or retirement.

Notices under this section should be

directed to the attention of the company’s

Corporate Relations Manager.

Sec. 903. REPURCHASES OF LISTED

COMPANY SECURITIES

(a) Private Transactions—Purchase Above

Market—A company is required to notify the

Exchange promptly of all facts relating to the

purchase, direct or indirect, of any of its

securities listed on the Exchange at a price

in excess of the market price of such security

prevailing on the Exchange at the time of

purchase. Such reports should be made by

telephone or telex and confirmed by letter.

Since such transactions may involve state

and Federal legal considerations, it is

recommended that company counsel and

officials of the Exchange be consulted prior

to effecting a proposed repurchase of listed

securities above the market.

It is the policy of the Exchange to make

such reports available to the public in its

library. In addition, the Exchange may

require the company to issue a public

announcement and a notice to its

shareholders regarding such repurchase.

(b) Open Market Purchases.—Rule 10b–18

under the Exchange Act provides a ‘‘safe

harbor’’ for issuer repurchases of up to 25%

of the average daily volume for the preceding

four weeks of exchange-traded securities

when certain timing, price and broker-dealer

conditions are met. Part (c) of such Rule

specifically provides, however, that

compliance with the conditions is not the

exclusive method available to listed

companies to effect repurchases in the

marketplace.

Companies planning to repurchase their

securities in the marketplace, should consult

with their Corporate Relations Manager

(whether or not they plan to rely on the safe

harbor of the Rule) to ascertain the

appropriate disclosure necessary for the

maintenance of a fair and orderly market.

Note: Companies should be aware of the

prohibitions on purchases contained in Rule

10b–6 under the Act when they are involved

in a non-technical distribution of their

securities.

(c) Purchases on behalf of certain employee

plans—Rule 10b–6 under the Exchange Act

exempts purchases by independent agents, as

defined, on behalf of certain employee and

shareholder plans.

(d) Tender Offer—A listed company

contemplating the making of a tender offer

for any or all of its securities should structure

the offer so as to comply with all applicable

Federal and state securities laws.

Inasmuch as a tender offer may

significantly affect the market for or the

continued listing eligibility of the security,

the company should consult with its

Corporate Relations Manager prior to the

announcement and commencement of such

offer.

(e) Odd-lot Tender Offers—A company

intending to make a tender offer to its oddlot (1 to 99 shares) holders may find the

following guidelines helpful:

(i) the use of a retroactive record date (i.e.,

a date immediately preceding the date of

announcement) will enable the company to

restrict the offer to existing odd-lot holders.

(ii) the tender offer should remain open for

a sufficient period of time to provide all oddlot holders with ample opportunity to

participate; and

(iii) since many odd-lot holdings are in

‘‘street’’ or nominee names, the company

should provide a mechanism which allows

its beneficial holders to participate equally

with record holders. In this connection, a

company may wish to consider the following:

(A) a ‘‘broker guarantee’’ provision which

permits the tender of odd-lot holdings that

are not readily available for physical delivery

within the tender period;

(B) a requirement that holders of record

tendering on behalf of a beneficial owner

confirm to the company that the securities

tendered represent the beneficial owner’s

entire holdings of that security.]

RELATIONSHIP WITH SPECIALIST (§ 910)

Sec. 910. PROCEDURES, RULES AND

REGULATIONS

From time to time, company officials

inquire about Exchange rules or regulations

affecting their relationship to the registered

specialist in their securities.

(a) Specialist’s Function—[The specialist is

a] Specialists are members of the Exchange

who performs two basic functions regarding

the issues in which [he] they specialize[s]. As

[a] brokers, [he they hold[s] and execute[s]

orders entrusted to [him] them by other

brokers on behalf of their customers. As [a]

dealers, [he is] they are obliged, insofar as

reasonably practicable, to purchase and sell

securities for [his] their own account in order

to help maintain a fair and orderly market.

[His] Their aim is to provide a continuous

auction market throughout the trading day,

with minimum price changes between

transactions. [The specialist does] Specialists

do not by [his] their own activities determine

the trend of stock prices. Rather, the price at

any given moment is determined

fundamentally by the balance of public buy

and sell orders.

(b) Liaison—The Exchange recognizes that

periodic communication between company

officials and their specialists, if appropriately

conducted, can be beneficial to both parties.

Such communication may provide company

officials with a better understanding of the

auction market, the specialist system and

their own specialist’s role in relation to the

company’s securities. From the specialist’s

viewpoint, an awareness and understanding

of the company and its affairs may aid [him]

specialists in discharging [his] their

responsibility for maintaining a fair and

orderly market in the company’s securities.

(c) Scope of Permissible Disclosure—In

view of the specialist’s central and sensitive

role in the auction market, it is essential that

Federal securities laws, Exchange rules and

a responsible code of conduct be observed in

all communications between specialists and

company officials. The following summary

may serve as a guide as to the scope of

permissible disclosure in such

communications.

A company may make available to the

specialist whatever information it has

provided to its stockholders, security

analysts or the general public, such as

specific data and information concerning

general trends relating to the company’s

business, as well as industry and general

economic developments that may influence

the company’s welfare. It is improper,

however, to furnish to the specialist any

material information not previously released

to the public regarding such matters as

earnings, forecasts, anticipated dividend

action, a proposed stock split, merger

negotiations or any other undisclosed matter

which is likely to have a significant effect on

the price of the company’s securities or

influence investment decisions.

While it is not contemplated that a

company will be in continuous contact with

its specialist, the specialist may from time to

time inform company officials of unusual

market problems and respond to broad

questions about the market in the company’s

stock. The restrictions imposed on [a]

specialists concerning the information [he]

they may disclose are set forth in paragraph

(d)(i) below.

Within this framework, company officials

and specialists should feel free to call upon

each other so that a mutually beneficial

understanding of the problems encountered

by each is fostered.

(d) Exchange Rules Governing Specialist’s

Activities—In addition to certain provisions

of the Securities Exchange Act of 1934, a

number of Exchange regulations place clearly

defined limits on a specialist’s activities. An

awareness of both the intent and spirit of

Exchange rules, and the responsibilities the

Exchange places on the specialist, will help

ensure that contacts between company

officials and the specialist are conducted

within the framework provided for above.

With respect to any security in which a

specialist is registered, Exchange rules

prohibit [the] specialists (and, with respect to

paragraphs iii through ix, the member firm or

member corporation of which the specialist

is a member) from:

(i) disclosing, at any time, to any person

other than a Floor Official or authorized

Exchange Official, any information in regard

to orders entrusted to the specialist or the

name of a buyer or seller except as may be

necessary solely for the purpose of

processing a transaction; however, that when

requested by a member, member

organization, or representative of the issuer

of the security involved, [the] specialists

shall, to the best of [his] their ability, disclose

6660 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

to such parties the names of buying and

selling member organizations in completed

Exchange transactions unless specifically

directed to the contrary by the member

organizations involved;

(ii) effecting transactions for [his] their own

account, unless such dealings are reasonably

necessary to permit [him] them to maintain

a fair and orderly market;

(iii) acquiring, holding or granting an

option in any such security;

(iv) being an officer or director of the issuer

of any such security;

(v) nominating, directly or indirectly, any

person to be on the board of directors of the

issuer of any such security;

(vi) effecting, directly or indirectly, any

business transaction with the issuer of any

such security or any officer, director or 10%

stockholder of any such issuer;

(vii) accepting an order for the purchase or

sale of any stock directly from the company

issuing such stock; from any officer, director

or 10% stockholder of that company; from

any pension or profit-sharing fund; or from

any bank, trust company, insurance

company, investment company, or similar

institution;

(viii) soliciting any proxy, directly or

indirectly, on behalf of [himself] the

specialist or any other persons in respect of

any such security; and

(ix) voting, directly or indirectly, in any

proxy contest involving any such security in

which [he] the specialist has a beneficial

interest.

With respect to any security in which a

specialist is registered, Exchange rules

require the specialist to report to the

Exchange:

(i) unusual activity or price change:

(ii) information which may materially

affect the business or financial structure of

the issuer of, or the market for, such security;

(iii) the existence of options or selling

agreements;

(iv) any unusual transaction in which the

specialist participates as a broker or dealer;

and

(v) each purchase and sale for the

specialists’ own account.

[(e) Corporate Relations Manager—A

company’s Corporate Relations Manager may

serve as a communications link between a

company and the specialist and can be

helpful whenever questions about activity in

a company’s stock or other matters arise (see

§§ 207 and 405).] Director—The company

will be assigned a day-to-day contact

(Director) who will:

(i) respond to questions concerning

performance of the company stock;

(ii) assist the company in developing

customized investor relations programs;

(iii) keep company officials abreast of

industry—related issues and rule changes;

and

(iv) serve as liaison between company

officials and specialist and generally provide

guidance to the company concerning its

Exchange listing.

* * * * *

CHANGE OF NAME (§ 930, § 931)

Sec. 930. CHANGE OF NAME

A company proposing to change its name

should:

* * * * *

(c) As soon as the change in name has been

approved by shareholders, notify the

Exchange [(by telephone or telex)] of the time

when the amendment to the charter will be

filed and the change in name will become

effective. Confirm this advice by letter.

* * * * *

(e) Notify the Exchange [(by telephone or

telex)] as soon as the amendment has actually

been filed and confirm this advice by letter.

[(f) As soon as available, furnish the

Exchange with a copy of the amendment to

the charter covering the change in name

certified as to its filing by the office of the

Secretary of State. A specimen copy of each

denomination of the stock certificates on

which the change in name is reflected (in the

form in which such certificates will be issued

against transfers after the effective date of the

change in name) should also be furnished.]

* * * * *

CHANGE IN PAR VALUE (§ 940)

Sec. 940. CHANGE IN PAR VALUE

A company that changes the par value of

a stock issue listed on the Exchange, without

an increase or decrease in the number of

shares listed, is required to follow the

procedures and file the papers specified

below:

* * * * *

[(d) Immediately after the filing of the

charter amendment, the company must

furnish the Exchange with the following

documents:

(i) A copy of the Certificate of Amendment

of the charter effecting the change in par

value, certified by the Secretary of State or

corresponding authority.

(ii) Specimens of all denominations of the

new or changed form of stock certificates

reflecting the change in par value. It is

advisable to furnish these prior to the filing

of the charter amendment.

(iii) Opinion of counsel of satisfactory

standing: (A) as to the legality of

authorization of the change and the validity

of the new par value shares resulting from

such change; (B) that the new par value

shares are validly issued, fully-paid and nonassessable; and (C) that no personal liability

attaches to ownership thereof. If such

counsel or any partner of such, counsel (or,

if a firm, any member thereof) is an officer,

director or shareholder of the company, this

fact should be stated in the opinion.]

* * * * *

APPLICATION AND INTERPRETATION OF

REQUIREMENTS (§§ 90–994)

* * * * *

Sec. 994. NEW POLICIES

Copies of new or revised rules, policies, or

forms, adopted subsequent to the date of this

Guide, will be distributed, following their

adoption. Questions concerning new

materials, as well as materials contained in

this Guide, should be directed to a

company’s assigned [Corporate Relations

manager] Listing Qualifications Analyst.

* * * * *

PART 11. Guide To Filing Requirements

(§ 1101, § 1102)

Sec. 1101. GENERAL

A company having a security listed on the

Exchange and registered under Section 12(b)

of the Securities Exchange Act of 1934 is

required to file information, documents and

reports with the SEC (or other appropriate

regulatory agency) on a timely basis and file

original or conformed copies with the

Exchange. With the exception of annual

reports to shareholders, which must continue

to be filed with the Exchange in hard copy,

a company which submits such material

electronically to the SEC will be deemed to

have satisfied this requirement.

The Exchange also requires timely notice

and written confirmation of certain

additional information, including proposed

amendments to and certified copies of the

Certificate of Incorporation, By-laws or other

similar organization documents and all

material sent to shareholders or released to

the press. A summary guide to the

Exchange’s filing requirements following:

* * * * *

[Treasury Stock Changes ................................................. Within ten days after the end of a quarter in which a

change occurred.

1 901]

* * * *** *

[Charter or By-Law Amendments ..................................... As soon as effective ......................................................... 1 702]

* * * *** *

Form N–SAR (for unit investment trusts and open-end

management investment companies).

Concurrently with SEC filing ............................................ *1 1101

Form N–30D (for unit investment trusts and open-end

management investment companies).

Concurrently with SEC filing ............................................ 3 1101

Form 24F–2; Form S–6; Form N–8B–2 (for unit investment trusts).Concurrently with SEC filing ............................................ *1 1101

497 (for open-end management investment companies) Concurrently with SEC filing ............................................ 3 1101

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6661

Form 24F–2 NT (for open-end management investment

companies).

Concurrently with SEC filing ............................................ *1 1101

* * * *** *

Supplement

Emerging Company Marketplace

The Exchange established the Emerging

Company Marketplace to accommodate the

listing of companies, domestic or foreign,

which are too small to qualify for regular

listing. In May 1995 the Exchange

determined to discontinue the list of new

companies on the ECM. Companies which

were listed on the ECM at that time were

permitted to continue listed there, subject to

all the rules applicable to ECM issues.

[NUMERICAL CRITERIA

A. Common Stock

Regular Alternate

Companies Traded in NASDAQ:

Total Assets ........................................................................................................................ $2 million ............................ $2 million.

Stockholders’ Equity ........................................................................................................... $1 million ............................ $2 million.

Aggregate Market Value .................................................................................................... $2.5 million ......................... $2.5 million.

Public Float * ....................................................................................................................... 250,000 shares .................. 250,000 shares.

Public Shareholders * ......................................................................................................... 300 ..................................... 300.

Minimum Price .................................................................................................................... $1 ....................................... Below $1.

Companies Not Traded in NASDAQ:

Total Assets ........................................................................................................................ $4 million ............................ $3 million.

Stockholders’ Equity ........................................................................................................... $2 million ............................ $2 million.

Aggregate Market Value .................................................................................................... $2.5 million ......................... Above $10 million.

Public Float * ....................................................................................................................... 250,000 shares .................. 400,000 shares.

Public Shareholders * ......................................................................................................... 300 ..................................... 3,300.

Minimum Price .................................................................................................................... $3 ....................................... $2.

* These terms include both shareholders of record and beneficial holders, but are exclusive of the holdings of officers, directors, controlling

shareholders, and other concentrated (i.e. 5 or grater), affiliated or family holdings.

B. Preferred Stock

In addition to satisfying the assets, equity

and price criteria set forth in A above, the

company must (i) appear to be in a financial

position sufficient to satisfactorily service the

dividend requirements for the issue, and (ii)

have at least 100,000 preferred shares

publicly held (as defined in A above) with an

aggregate market value of at least 2,000,000.

The Exchange will not list convertible

preferred issues containing a provision

which gives the company the right, as its

discretion, to reduce the conversion price for

periods of time, or from time to time, unless

the company establishes a minimum period

of ten business days within which such price

reduction will be in effect.* The Exchange

also will not consider listing a convertible

preferred issue unless the underlying

common stock meets all the criteria set forth

in Part A above.

The Exchange strongly recommends that

each preferred issue listed on the ECM be

structured so as to comply with the voting

requirements of Section 124 of the Company

Guide.

C. Warrants

The listing of warrant issues is subject to

all of the numerical criteria set forth in Part

A, except for those with respect to price and

market value. However, the Exchange will

not consider listing warrants exercisable into

common stock unless such common stock

meets all the criteria set forth in Part A

above.*

The Exchange will not list warrant issues

containing provisions which give the

company the right, at its discretion, to reduce

the exercise price of the warrants for periods

of time, or from time to time, during the life

of the warrants, unless the company

establishes a minimum period of ten business

days within which such price reduction will

be in effect. This policy will not preclude the

listing of warrant issues for which regularly

scheduled and specified changes in the

exercise price have been previously

established.

Whenever a company having warrants

listed on the Exchange effects a split of 3-for2 or greater in the underlying shares, the

Exchange requires that a corresponding split

be made in the warrants.

D. Debt Issues

Companies applying for listing of bonds or

debenture issues are expected to meet the

following criteria:

(a) The company appears to be in a

financial position sufficient to satisfactorily

service the debt issue to be listed and meets

the assets and stockholders’ equity criteria

set forth in A above.

(b) Listing will be limited to debt securities

of at least $5 million in principal amount/

aggregate market value.

(c) The Exchange will not list convertible

debt issues containing a provision which

gives the company the right, at its discretion,

to reduce the conversion price for periods of

time, or from time to time, unless the

company establishes a minimum period of

ten business days within which such price

reduction will be in effect.* The Exchange

also will not consider listing a convertible

debt issue unless the underlying common

stock meets all the criteria set forth in Part

A above.

E. Units

The Exchange may list units comprised of

one or more of the securities enumerated

above provided that each of the component

parts of the unit would otherwise separately

satisfy the applicable listing requirements.

F. Redemption, Cancellation, Retirement

A company is not permitted to select any

of its listed securities for redemption

otherwise than pro rata or by lot, and is

required to notify the Exchange at least 15

days in advance of any redemption and to

furnish it promptly with any information

requested in connection with the

redemption.

G. Listing Procedures

A company which satisfies the original

listing criteria may apply for a confidential

preliminary listing eligibility opinion which

will be furnished without charge as described

in § 202.

Footnotes: *The Exchange will not

consider listing warrants, convertible

preferred or convertible debt issues of a

company unless current last sale information

is available with respect to the underlying

security.]

* * * * *

[LISTING FEES

There is a one-time original listing fee of

$5,000 which is inclusive of all issues which

become listed on the ECM. In addition, an

annual fee shall be payable, as provided by

§ 141.]

* * * * *

CONTINUED LISTING CRITERIA

Continued listing on the Exchange is

dependent upon compliance with the

following numerical criteria:

A. Common Stock

no change

[B. Preferred Stock

In addition to satisfying the assets, equity,

market value and price criteria set forth in A

above, the company will be subject to

6662 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

6Changes to Part 4 of the Listing Standards reflect

the elimination of the Corporate Relations Manager

job function and the function and the division of

the responsibilities of the former Corporate

Relations Manager among the Listing

Qualifications, Stock Watch, and Issuer Service

Departments.

7 In the standard comment letter that the

Exchange sends issuers after Exchange staff has

reviewed the issuer’s listing application, the

Exchange will ask issuers specific questions

concerning quorum requirements, notice of record

dates to shareholders and closing of transfer books.

Telephone call between Michael S. Emen, Vice

President, Listing Qualifications, Amex, Rebekah

Liu, Special Counsel, Division, Commission, and

Sonia Patton, Attorney, Division, Commission, on

January 27, 2000.

delisting if it does not have at least 50,000

preferred shares publicly held (as defined in

A above).

C. Warrants

Warrant issues must satisfy all the

numerical criteria set forth in Part A, except

those with respect to price and market value.

In addition if the warrants are exercisable

into common stock, the warrants are subject

to delisting if the common stock is not in

compliance with the numerical criteria set

forth in A above.

D. Debt Issues

Continued listing on the Exchange for bond

and debenture issues is dependent upon

compliance with the criteria specified in

§§ 1003 (b)(iii) and (e) of the Company Guide.

E. Units

Continued listing on the Exchange of units

comprised of one or more of the securities

enumerated above is dependent upon

compliance by each component part of the

unit with the applicable criteria enumerated

above.

F. Additional Requirements

Companies with a deficiency in market

value or price for 10 consecutive trading days

shall have 90 days thereafter in which to

comply with the continued listing

requirements. Companies with a deficiency

in any other criteria shall be immediately

subject to delisting in accordance with the

procedures set forth in § 1010 of the

Company Guide.

In addition, the Exchange shall delist any

issue which ‘‘ceases to be an Eligible

Security’’ pursuant to Section VI(c)(iii) of the

Consolidated Tape Plan, and the issues of

any company which fails to take appropriate

steps to ensure that no ECM-listed securities

are sold in its behalf in reliance upon the

exemption from state securities registration

which is otherwise available to companies

listed on the Exchange.

Appendix: Listing Forms

* * * * *

Listing Form 1

Listing Agreement

—(the ‘‘Company’’), in consideration of the

listing of its securities, hereby agrees with the

American Stock Exchange, Inc. (the

‘‘Exchange’’), that it will:

(1) Comply with all Exchange rules,

policies and procedures which apply to

listed companies as they are now in effect

and as they may be amended from time to

time, regardless of whether the company’s

organization documents would allow for a

different result.

(2) Notify the Exchange, at least 20 days in

advance, of any change in the form or nature

of any listed security or in the rights, benefits

and privileges of the holders of such security.

(3) File with the Exchange (i) proposed

amendments to and certified copies of the

Certificate of Incorporation; By-Laws or other

similar organization documents; (ii) all SEC

filings; and (iii) all material sent to

shareholders or released to the press.]

Listing Form 2

Distribution and Trading Information

DELETED

Listing Form 3

Agreement With Transfer Agent

DELETED

Listing Form 4

Agreement With Registrar

DELETED

Listing Form 5

Agreement With Warrant Agent

DELETED

Sample Trustee’s Certificate

DELETED

Sample Agreement of Banknote Company

DELETED

* * * * *

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

Due to the merger between the National

Association of Securities Dealers (‘‘NASD’’)

and the Amex, the qualifications functions

for the Nasdaq Stock Market (‘‘Nasdaq’’) and

the Amex have been centralized in the

Nasdaq-Amex Listing Qualifications

Department (‘‘Listing Qualifications’’). As a

result of this centralization, a number of

Exchange rules have been reviewed with the

goal of modernizing the Exchange’s initial

and continued listing process, creating

consistent rules and processes across all of

the NASD’s marketplaces, and reflecting the

current business practices and procedures

used by Listing Qualifications. This filing

addresses those goals and makes other nonsubstantive changes to reflect changed job

titles 6 and responsibilities following the

merger, and clarifies the application of

certain Exchange rules.

Application Process

Currently, Exchange rules encourage

issuers to obtain an informal opinion from

Amex staff, known as the Preliminary Listing

Eligibility Opinion (‘‘PLEO’’), as to whether

the issuer is eligible to list before formally

applying to the Exchange. Because of the

time involved for the issuer to prepare for

this extra review and for staff to conduct this

extra review, the PLEO process causes a

delay in the time it takes for a final

determination to be made on an issuer’s

application for listing on the Exchange. This

process is also inconsistent with the Nasdaq

process in which an application is filed at the

outset of the process. As a result, when an

issuer initially pursues listing on both

markets, the issuer faces a delay in its ability

to make a decision as to where to list. In

order to streamline the application process,

the Exchange proposes to eliminate the PLEO

process. Accordingly, the Exchange proposes

to delete Sections 202 and 203 of the Listing

Standards, Policies and Requirements and

modify Sections 101, 130, 201 and 211 to

eliminate references to the PLEO process.

Under the proposed revision, issuers will

only file their completed listing application

with the Exchange’s staff.

In addition, Exchange rules currently

require a number of documents to be

submitted with an original listing

application. The Exchange proposes to

eliminate certain requirements, including the

Exchange’s Listing Form 2 (Certificate of

Distribution), Charter, By-Laws, Specimen

Certificates, Trustee Certificates, Form for

Indenture, Board Resolutions and certain

contracts. Many of these documents are

electrically available through an Issuer’s

public filings, or they are generally available

to Listing Qualifications through other means

(or upon request by Exchange staff from the

issuer). Therefore, the Exchange proposes to

remove these general requirements and

instead request specific documents as

necessary.7 Specifically, the Exchange

proposes to modify Sections 213, 216, 218,

305, 306, and 702 to reflect these changes.

Similarly, the Exchange proposes that

issuers no longer be required to obtain an

opinion of counsel which, among other

things, relates to the legality of the

organization and existence of the issuer and

the validity of the securities to be listed.

These rules were originally enacted to

prevent unauthorized securities from

entering into the market and to protect the

Exchange from legal liability, which might

arise from the listing and trading of such

securities. Today, however, such concerns

are unwarranted. In particular, an issuer’s

independent auditor reviews the issuance of

securities as part of its annual audit and,

generally, legal comfort is provided to market

participants with respect to most securities

issuances, including public offerings.

Furthermore, the Exchange is largely

protected from legal claims against it by its

status as a self-regulatory organization and no

Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices 6663

8Through its standard comment letter, the

Exchange will require issuers to (i) furnish the

Exchange with copies of opinion of counsel filed in

connection with recent public offerings or private

placements or (ii) if no opinions of counsel exist,

represent to the Exchange that they are duly and

validly organized under the laws of their state of

incorporation. Telephone call between Michael S.

Emen, Vice President, Listing Qualifications, Amex,

Rebekah Liu, Special Counsel, Division,

Commission, and Sonia Patton, Attorney, Division,

Commission, on January 27, 2000.

9This is consistent with the approach taken on

the Nasdaq, resulting in identical application across

all of the NASD’s marketplaces.

10See Exchange Act Rules 17Ad–1 through

17Ad–21T, 17 CFR 240.17Ad–1 through 17 CFR

240.17A21T.

recent case has been brought alleging invalid

issuance of an Exchange security.

Accordingly, the Exchange proposes to delete

requirements related to opinions of counsel

in Sections 213, 216, 218, and 306 of the

Listing Standards.8

The Exchange currently requires an

application to be submitted by an issuer

whenever a shareholder rights plan is

established and the underlying rights are

registered with the Commission. These

rights, commonly known as ‘‘poison pills,’’

technically constitute a separate security but

trade in tandem with an as part of the issuer’s

common stock. Upon the occurence of a

‘‘triggering’’ such as the announcement of a

hostile takeover or the acquisition of a

specified percentage of the company’s

outstanding common stock, the rights would

detached from the common stock and

become freely tradable as separate securities.

At that point, under Exchange rules, the

issuer is required to file a listing application

with respect to those new securities. Given

the listing application requirement upon the

occurrence of a triggering event and the fact

that until that time the securities are not

traded as separate securities, the Exchange

believes the requirements of Section 343 are

not necessary.

Criteria for Original Listing

Sections 104 and 105 of the Listing

Standards allow the listing of debt and

warrants on the Amex, but only if the issuer

is listed on the Amex or the New York Stock

Exchange (‘‘NYSE’’. This rule is no longer

necessary or appropriate, given the level of

the listing standards on Nasdaq in

comparison to those of the Amex and the

NYSE. The Exchange therefore proposes to

expand the issues which may be listed on

Amex to include debt and warrants of issuers

listed on Nasdaq.

Sections 112, 115, and 116 of the Listing

Requirements impose more stringent

standards on specific types of issuers:

exploration and development companies,

member corporations, and companies

engaged in gaming operations. These rules

arose when such companies generally

remained private and the listing of

companies in such sectors was fairly

unusual. The Exchange proposes to eliminate

these sector-specific sections since the listing

of securities of issuers in these sectors is now

fairly common across all markets and issuers

in these sectors now operate in highly

regulated environments. Specifically, with

respect to exploration and development

companies, the Exchange notes that detailed

disclosures about the issuer’s stage of

development and prospects are provided to

potential investors in required, publicly filed

reports. Accordingly, the Exchange does not

believe it is appropriate to discriminate

against such exploration stage companies

seeking to raise capital on the Exchange.

With respect to member corporations, the

Exchange notes that these issuers are

regulated by both the Commission and the

membership organization to which the issuer

belongs. Finally, with respect to companies

engaged in gaming operations, the Exchange

notes that these issuers operate in a highly

regulated environment and are subject to

substantial state and/or federal regulation.

Furthermore, the Exchange notes that under

its discretionary authority over all issuers,

pursuant to Section 101, it has authority to

deny listing to issuers based on sectorspecific issues in appropriate situations.

Accordingly, the Exchange does not believe

that the specific rules relating to issuers in

these sectors are necessary or appropriate.

The Exchange also proposes to clarify that

the alternate listing guidelines contained in

Section 101 of the Listing Standards are not

limited to issuers in certain sectors. The

alternate guidelines were first adopted in

1977 and then modified in 1986 to allow a

broader range of companies to qualify. The

guidelines referenced as examples,

companies that were unable to satisfy the

basic criteria due to significant research and

development or other similar business

development costs. The Exchange proposes

changes to Section 101 to clarify that the

numerical aspects of the alternate guidelines

apply to all issuers, regardless of industry.

This change would be consistent with the

approach used on Nasdaq, SmallCap Market,

and the NYSE, where alternative listing

requirements are available to all issuers that

meet the quantitative requirements.

Fees

Section 144 of the Listing Standards

currently imposes a $250 non-refundable

service charge that is subtracted from any

refund otherwise due an issuer that is not

approved for listing or that withdraws after

completing the application process. Given

the cost incurred by the Exchange in

reviewing an application, the Exchange

proposes to raise the non-refundable portion

of the initial inclusion fee from $250 to

$1,000 and to require the payment of this

amount in advance of processing the

application, in order to timely recoup such

costs, especially in situations where these

costs are incurred by the Exchange and the

application is then withdrawn. The Exchange

notes that this proposed change will not

affect the listing fees paid by issuers who

ultimately list on the Exchange and that this

practice is consistent with that followed by

Nasdaq. In addition, the Exchange notes that

if an issuer applies for listing on both the

Exchange and on Nasdaq, only a single

$1,000 non-refundable fee would be collected

for review of both applications.

The Exchange also proposes to modify the

treatment of treasury shares for fee purposes.

Under existing Section 141, Amex listing fees

are based on all shares outstanding,

including treasury shares. The Exchange

proposes to modify Section 141 to excluse

treasury shares when calculating shares

outstanding for fee purposes 9 and to clarify

that annual fees billed based on shares

outstanding information refers to information

available on Exchange records as of

December 31, and not shares outstanding

information sent to the Exchange by issuers

some time in February. This proposed change

will result in a decrease in fees for issuers

with treasury shares and will not affect other

issuers.

Finally, as discussed above, because the

Exchange proposes to eliminate Section 343,

requiring the submission of an application

upon the creation of a shareholder rights

plan, the Exchange also proposes to modify

Section 140, to eliminate the $1,000 fee

associated with the shareholder rights plan

application.

Schedule for Dividends

The Exchange proposes to eliminate

several archaic rules that require additional

time between the declaration and dividend

date for dividends of issuers that do not have

transfer facilities in the New York City area.

Given the current state of communication

networks and electronic interaction between

issuers, transfer agents and investors, these

additional time periods are no longer

necessary. Accordingly, the Exchange

proposes to modify Sections 502, 512, and

521 and to eliminate Section 520 to

implement this proposed change.

Transfer Facilities

Likewise, the Exchange proposes to remove

a variety of rules concerning the qualification

of Transfer Agents, Registrars, and Bond

Trustees presently contained in Sections

801–811. The Commission regulates the

transfer agent industry and, since 1976, has

imposed a series of rules over the industry 10

that make many of the Exchange’s rules

unnecessary. Other Exchange rules relating to

transfer agents (as well as Agents for

Payment) are archaic, as they limit the ability

of agents with physical locations outside of

New York to perform these functions. The

Exchange also proposes to eliminate the

requirements relating to Trustees for Bond

Issues in Section 811. The Exchange has

never experienced a problem with respect to

the qualification of a Bond Trustee and

believes that these matters are better left to

the individual issuers and applicable state

law. Accordingly, the Exchange proposes to

delete Sections 801–811 and to make

conforming changes to other sections that

refer to those sections.

Certificate Requirements

The Exchange also proposes to remove

requirements relating to the form of securities

and lost security holders. The rules relating

to the form of securities are antiquated and

may impede the use of innovations in this

area, such as DTC holdings and book entry

methods. Furthermore, the Exchange notes

that there are no comparable rules on

Nasdaq. Accordingly, the Exchange proposes

6664 Federal Register / Vol. 65, No. 28 / Thursday, February 10, 2000 / Notices

11The Exchange notes that this proposed change

is consistent with the rules relating to conflicts of

interest that apply to Nasdaq issuers and NYSE

issuers. See NASD Rules 4310(c)(25)(G) and 4460(h)

and NYSE Listed Company Manual Section 307.00.

12See Exchange Act Release No. 36079 (Aug. 9,

1995), 60 FR 42926 (Aug. 17, 1995) (SE–Amex–95–

23). Companies that were listed at the time the

Emerging Company Marketplace was discontinued

were permitted to continue their listing, subject to

all the rules applicable to issuers on that Emerging

Company Marketplace.

13 15 U.S.C. 78f(b)(5). 14 17 CFR 200.30–3(a)(12).

to delete existing Sections 820 through 830,

inclusive, and Section 841 of the Listing

Standards. Likewise, the Exchange rules

governing the replacement of lost certificates

in Section 840 are no longer necessary in

light of current practices followed by issuers

and transfer agents.

Treasury Shares

Existing Exchange rules require an issuer

to report changes in the number of treasury

shares. Given the changes proposed to the fee

calculation for issuers, resulting in the

exclusion of treasury shares from the fee

base, the Exchange no longer needs this

information. Accordingly, the Exchange

proposes to eliminate Section 901 of the

Listing Standards. Furthermore, Section 903,

on repurchases of listed company securities,

in unnecessary because it does not impose

any Exchange requirements, but merely refers

issuers to federal securities laws. Finally, the

Exchange notes that Section 902 allows an

issuer to redeem securities only in a pro rata

fashion or by lot. The Exchange notes that

issuers are governed by state law

requirements in the redemption of securities

and that as a practical matter, one of these

methods is invariably applied. Therefore, the

Exchange believes that Section 902 is

unnecessary and proposes its deletion and

conforming amendments to Sections 103(d),

104, and 105(b).

Other Changes to the Exchange’s Listing

Requirements

The Exchange proposes certain changes to

the listing requirements for issuers listed on

the Amex. The Exchange proposes to change

the definition of ‘‘public distribution’’ and

‘‘public shareholders’’ as defined in Section

102. Currently, in determining the number of

shares in the public, Exchange rules exclude

concentrated holdings of 5% or greater. The

comparable rules on Nasdaq, as well as the

NYSE, only exclude holdings of 10% or

greater. The Exchange believes that it is

appropriate to exclude holdings of between

5% and 10% from the definition of public

distribution and accordingly, proposes to

modify Section 102.

Next, the Exchange proposes to modify

Section 120, relating to conflicts of interest.

The existing Exchange rule states that the

Exchange will consider conflicts situations in

connection with the original listing of an

issuer. The Exchange believes that a broader,

ongoing review of related party transactions

is appropriate and that the issuer’s Audit

Committee (or a comparable body) is an

appropriate body for conducting such a

review. Furthermore, the Exchange notes that

under the proposed change, as in all cases,

it may review a transaction using the

Exchange’s general discretionary authority if

a transaction involved a conflict that raised

public interest concerns. Accordingly, the

Exchange proposes to adopt this revised

listing requirement to better protect

investors.11

The Exchange also proposes to amend its

rules relating to shareholder approval

contained in Section 713 to clarify that

shareholder approval is required prior to

issuance of a security that has the potential

to result in the issuance of 20% of the pretransaction common shares outstanding for

less than the greater of book or market value

of the stock. While the present language of

the rule does not include the word potential,

it is fairly implied and Exchange staff has

consistently applied the rule to require

approval in cases where an issuance may

potentially exceed the state threshold.

Accordingly, the Exchange proposes to

modify the existing rule to clarify that an

issuance is not permissible without

shareholder approval when there is the

potential to issue more than 20% of the pretransaction common shares outstanding for

less than the greater of book or market value

of the stock.

Emerging Company Marketplace

In May 1995, the Exchange determined to

discontinue the listing of new companies on

the Emerging Company Marketplace and

subsequently received Commission

approval.12 Accordingly, the Exchange

proposes to delete from the Supplement the

criteria for new listing on the Emerging

Company Marketplace given that no new

issues are permitted to be listed on that

market. Furthermore, the Exchange proposes

to delete from the Supplement the continued

listing criteria with respect to all issues other

than common stock because no existing

issuers rely on these provisions and no new

issuers can be listed that would rely on these

provisions. This conforming change is

consistent with the SEC’s order approving

the elimination of the Energing Company

Market.

2. Statutory Basis

The Exchange believes that the proposed

rule change is consistent with Section 6(b)(5)

of the Act,13 which requires, among other

things, the Exchange’s rules to be designed to

prevent fraudulent and manipulative acts

and practices 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 Act.

C. Self-Regulatory Organization’s Statement

on Comments on the Proposed Rule Change

Received From Members, Participants, or

Others

The Exchange did not solicit or receive

written comments on 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 such 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 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 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 Amex. All

submissions should refer to the File No. SR–

Amex–99–39 and should be submitted by

March 2, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.14

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–3034 Filed 2–9–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

(Release No. 34–42383; File No. SR–Amex–

99–35)

Self-Regulatory Organizations;

American Stock Exchange LLC; Order

Approving Proposed Rule Change To

Rescind Exchange Rule 106,

‘‘Substitute Principals’’

February 3, 2000.

I. Introduction

On September 1, 1999, the American

Stock Exchange LLC (‘‘Amex’’ or

‘‘Exchange’’) submitted to the Securities

and Exchange Commission (‘‘SEC’’ or

‘Commission’’) pursuant to Section