Document ID: SEC-2005-0281-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: American Stock Exchange LLC
Posted Date: 2005-11-28T05:00Z

[Federal Register: November 28, 2005 (Volume 70, Number 227)]
[Notices]               
[Page 71342-71344]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28no05-100]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52804; File No. SR-Amex-2005-114]

 
Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing of a Proposed Rule Change and Amendment No. 1 Thereto 
Relating to the Amex Initial Listing Standards

November 18, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on November 2, 2005, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange. On 
November 10, 2005, the Amex submitted Amendment No. 1 to the proposed 
rule change.\3\ The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 (``Amendment No. 1'') makes a clarification 
to the purpose section of the filing and makes changes to Section 
101 of the Guide, to reference Section 102(b) of the Guide in the 
listing provisions.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Amex proposes to amend Section 102(b) of the Amex Company Guide

[[Page 71343]]

(``Guide'') to require a minimum market price of $2 per share for 
issuers seeking to qualify for initial listing pursuant to Initial 
Listing Standard 3 (Section 101(c)). The Amex also proposes to amend 
Section 101 of the Guide to include a reference to Section 102(b) in 
each of the four initial listing standards to clarify that Section 
102(b) applies to each initial listing standard listed in Section 101 
of the Guide.\4\
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    \4\ See Amendment No. 1, Id.
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    Below is the text of the proposed rule change. Proposed new 
language is in italics; proposed deletions are in [brackets].

American Stock Exchange Company Guide Criteria for Original Listing

Sec. 101. GENERAL
    The approval of an application for the listing of securities is a 
matter solely within the discretion of the Exchange. The Exchange has 
established certain minimum numerical standards, set forth below. The 
fact that an applicant may meet the Exchange's numerical standards does 
not necessarily mean that its application will be approved. 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.
    See Sec.  110 for special criteria relating to foreign issuers and 
Rules 1000, 1000A, and 1200 for rules relating to Portfolio Depositary 
Receipts, Index Fund Shares, and Trust Issued Receipts.
    (a) INITIAL LISTING STANDARD 1
    (1)-(3) No change.
    (4) Stock Price/Market Value of Shares Publicly Held--See Section 
102(b).
    (b) INITIAL LISTING STANDARD 2
    (1)-(4) No change.
    (5) Stock Price/Market Value of Shares Publicly Held--See Section 
102(b). 
    (c) INITIAL LISTING STANDARD 3
    (1)-(4) No change.
    (5) Stock Price/Market Value of Shares Publicly Held--See Section 
102(b).
    (d) INITIAL LISTING STANDARD 4
    (1)-(3) No change.
    (4) Stock Price/Market Value of Shares Publicly Held--See Section 
102(b).
    (e)-(g) No change.
* * * * *
Sec. 102. EQUITY ISSUES
    (a) No change.
    (b) Stock Price/Market Value of Shares Publicly Held--The Exchange 
requires a minimum market price of $3 per share for applicants seeking 
to qualify for listing pursuant to Section 101 (a), (b) or (d), a 
minimum market price of $2 per share for applicants seeking to qualify 
for listing pursuant to Section 101(c), and $3,000,000 aggregate market 
value of publicly held shares for applicants seeking to qualify for 
listing pursuant to Section 101(a). [In certain instances, however, the 
Exchange may favorably consider listing an issue selling for less than 
$3 per share after considering all pertinent factors, including market 
conditions in general, whether historically the issue has sold above $3 
per share, the applicant's capitalization and the number of outstanding 
and publicly-held shares of the issue.]
    (c) No change.

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, as 
amended. The text of these statements may be examined at the places 
specified in Item IV below. The Exchange has prepared summaries, set 
forth in Sections A, B, and C below, of the most significant aspects of 
such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Amex states that an approval of an application for the listing 
of securities on the Exchange is based on an applicant's ability to 
satisfy a series of quantitative and qualitative listing standards as 
evaluated by the Listing Qualifications Department. The Amex represents 
that the quantitative standards currently provide four alternative 
approaches for a company to satisfy the Amex's initial listing 
standards.
    For applicants to meet Initial Listing Standards 1, 2 and 4 (Guide 
Section 101 (a), (b), and (d), respectively), in addition to specified 
minimum numerical standards, the Exchange requires a minimum market 
price of $3 per share. Listing Standard 3 currently requires an 
applicant to meet minimum specified numerical standards but does not 
require the applicant to meet a minimum market price per share.
    The Exchange is proposing to enhance its initial listing 
quantitative standards to require applicants seeking to qualify under 
Initial Listing Standard 3 pursuant to Section 101(c) of the Guide to 
have a minimum market price of $2 per share. Accordingly, the Exchange 
is proposing to amend Section 102(b) to incorporate this requirement. 
The Exchange also proposes to amend Section 101 of the Guide to include 
a reference to Section 102(b) in each of the four initial listing 
standards to clarify that Section 102(b) applies to each standard 
listed in Section 101 of the Guide.\5\
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    \5\ See Amendment No. 1, supra note 3.
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    In addition, the Exchange proposes to delete the last sentence of 
Section 102(b) of the Guide. The Exchange states that this provision, 
which has been in place for many years, gives the Exchange the 
discretion under certain circumstances to consider listing an issue 
that qualified under Initial Listing Standards 1, 2 or 4 even if the 
issue's share price is less than $3. The Exchange represents that this 
provision was meant to cover the situation in which an applicant issuer 
meets all of the initial listing standards but experiences a decline in 
share price to below $3 per share just before listing. In light of the 
current and proposed configuration of the initial listing standards, 
the Exchange believes that this provision is no longer necessary or 
appropriate.\6\
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    \6\ Id.
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2. Statutory Basis
    The Exchange believes the proposal, as amended, is consistent with 
Section 6(b) of the Act \7\, in general, and furthers the objectives of 
Section 6(b)(5) of the Act,\8\ in particular, in that it is designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade, to foster cooperation and 
coordination with persons engaged in regulating, clearing, settling, 
processing information with respect to, and facilitating transactions 
in securities, to remove impediments to and perfect the mechanism of a 
free and open market and a national market system, and, in general, to 
protect investors and the public interest; and the proposal is not 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers, or to regulate by virtue of any authority 
conferred by the Act matters not related

[[Page 71344]]

to the purpose of the Act or the administration of the Exchange.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes the proposed rule change, as amended, will 
impose no burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    No written comments were solicited or received by the Exchange on 
this proposal, as amended.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding, or (ii) as to 
which the Exchange consents, the Commission will:
    A. By order approve the proposed rule change, as amended, or
    B. Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended, is consistent with the Act. Comments may be 
submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to rule-comments@sec.gov. Please include 

File Number SR-Amex-2005-114 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.
    All submissions should refer to File Number SR-Amex-2005-114. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments, 

all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for inspection 
and copying in the Commission's Public Reference Room. Copies of the 
filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-Amex-2005-114 and should be submitted on or before 
December 19, 2005.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. E5-6537 Filed 11-25-05; 8:45 am]

BILLING CODE 8010-01-P