Document ID: SEC-2009-1702-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; New York Stock Exchange LLC; Order Approving a Proposed Rule Change as Modified by Amendment No. 1 To Amend Certain Corporate Governance Requirements
Posted Date: 2009-12-04T05:00Z

[Federal Register: December 4, 2009 (Volume 74, Number 232)]
[Notices]               
[Page 63808-63812]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr04de09-116]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61067; File No. SR-NYSE-2009-89]

 
Self-Regulatory Organizations; New York Stock Exchange LLC; Order 
Approving a Proposed Rule Change as Modified by Amendment No. 1 To 
Amend Certain Corporate Governance Requirements

November 25, 2009.

I. Introduction

    On August 26, 2009, the New York Stock Exchange LLC (``NYSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to amend certain of the Exchange's corporate 
governance requirements for listed companies. NYSE filed Amendment No. 
1 to the proposed rule change on September 10, 2009. The proposal was 
published for comment in the Federal Register on September 17, 2009.\3\ 
The Commission received two comment letters on the proposal.\4\ This 
order approves the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 60653 (September 11, 
2009), 74 FR 47831 (September 17, 2009), 74 FR 48615 (September 23, 
2009) (``Notice'').
    \4\ See letters to Elizabeth M. Murphy, Secretary, Commission, 
from Dorothy M. Donohue, Senior Associate Counsel, Investment 
Company Institute, dated October 8, 2009, and from Davis Polk & 
Wardwell LLP, dated October 9, 2009 (``Davis Polk Letter'').
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II. Description of the Proposed Rule Change

    The Exchange proposes to amend Section 303A of its Listed Company 
Manual (``Manual''), which comprises the Exchange's corporate 
governance standards for listed companies, and to eliminate current 
Section 307.00, regarding related party transactions.\5\ The changes, 
which would take effect on January 1, 2010, include the following:
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    \5\ The Exchange states that current Section 307 is duplicative 
of Section 314. Under the proposal, current Section 303A.14 would be 
re-designated as Section 307.
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A. Corporate Governance Disclosures

1. Disclosures Required by Regulation S-K Under the Act
    Section 303A of the Manual currently requires a listed company to 
disclose the identity of its independent directors, the basis upon 
which its board may determine that a director is independent, and--if 
it is a controlled company--any exemptions from the independence 
requirements upon which it has relied. Disclosures relating to the same 
aspects of a company's corporate governance are now required by Item 
407 of the Commission's Regulation S-K.\6\ The proposal would eliminate 
each of the Exchange's requirements that is similar to a requirement of 
Item 407, and incorporate directly into Section 303A the applicable 
requirement of Item 407.\7\
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    \6\ 17 CFR 229.407.
    \7\ Section 303A also revises the requirements relating to 
reports by a company's audit and compensation committees that are 
required by the Commission and are to be included in the company's 
annual proxy statement or annual report. The proposed rule change 
would amend these requirements to reference the disclosures required 
by Item 407.
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2. Disclosures Regarding Required Web site Postings
    A listed company is required by the NYSE standards to post the 
charters of its audit, compensation, and nominating/corporate 
governance committees, its corporate governance guidelines, and its 
code of business conduct and ethics on the company's Web site, and to 
state in its proxy statement or annual report that these documents are 
so posted. The proposal would add that the listed company's Web site 
address must be included,\8\ but would delete the current requirement 
for the company to state that the documents are available in print to 
any shareholder who requests them.
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    \8\ The proposal also would reorganize the website posting 
requirements in the rule text. Further, Section 303A.07 would state 
expressly that closed-end funds are not subject to the requirement 
to post their audit committee charters, consistent with current 
practice.
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3. Other Required Disclosures
    Section 303A currently also requires various other disclosures to 
be made in the company's proxy statement or annual report.\9\ The 
Exchange proposes to allow a company alternatively to make these 
disclosures on its website.\10\ If a company chooses to do so, it would 
be required to disclose this in its proxy statement or annual report 
and provide the website address.
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    \9\ These disclosures concern contributions by the listed 
company to tax exempt organizations; executive sessions of non-
management or independent directors; communication with the 
presiding director or the non-management or independent directors; 
and simultaneous service of an audit committee member on the audit 
committees of more than three public companies.
    \10\ The proposed rule change would further provide that, if a 
listed company makes a required Section 303A disclosure in its proxy 
statement or annual report filed with the Commission, it may 
incorporate such disclosure by reference from another document that 
is filed with the Commission to the extent permitted by applicable 
Commission rules.
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    Section 303A.11 of the Manual currently requires a foreign private 
issuer to disclose any significant ways in which its corporate 
governance practices differ from those required of domestic companies 
under NYSE listing standards. Under the proposal, a foreign private 
issuer that is required to file an annual report on Form 20-F with the 
Commission would be required to include the statement of significant 
differences in that annual report.
    The proposal also would eliminate the requirement in Section 
303A.12(a) that a listed company disclose in its annual report (or on 
Form 10-K if the company does not prepare an annual report to 
shareholders) that its chief executive officer (``CEO'') filed the 
certification regarding corporate governance required by the Exchange, 
and that the company complied with Commission certification 
requirements regarding public disclosure. The Exchange proposes to 
revise Section 303A.12(b) to provide that the CEO of a listed company 
must notify the Exchange in writing after any executive officer of the 
company becomes aware of any non-compliance with Section 303A, as 
opposed to requiring notification in the event of material non-
compliance as provided by the current rule.

B. Transition Periods for Newly-Listed Companies

    By way of background, NYSE's rules incorporate by reference Rule 
10A-3 under the Act,\11\ which requires a listed

[[Page 63809]]

company to have an audit committee composed solely of independent 
directors. Rule 10A-3 permits a company listing in conjunction with an 
initial public offering (``IPO'') to phase in compliance with this 
requirement. Under Rule 10A-3, all but one member of the audit 
committee may be exempt from the independence requirements of the rule 
for ninety days from the date of effectiveness of the issuer's 
registration statement under Section 12 of the Act or the issuer's 
registration statement under the Securities Act of 1933 covering the 
issuer's initial public offering (``IPO'') of securities to be listed 
by the issuer, and a minority of the members of the committee may be 
exempt from the independence requirements of Rule 10A-3 for one 
year.\12\
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    \11\ 17 CFR 240.10A-3.
    \12\ 17 CFR 240.10A-3(b)(1)(iv)(A).
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    The Exchange's rules require that the nominating and compensation 
committees of a listed company also be composed solely of independent 
directors. However, companies listing in conjunction with an IPO are 
permitted a transition period for these committees to be composed 
solely of independent directors that is similar to that permitted by 
Rule 10A-3 for audit committees: at least one independent director 
member at the time of listing, a majority of independent director 
members within ninety days of listing, and a fully independent 
committee within one year.\13\ The proposal would adjust this 
transition schedule to allow the first independent director member to 
be appointed by the earlier of the date that the IPO closes or five 
business days from the listing date, rather than on the listing 
date.\14\
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    \13\ The proposed rule change would define the ``listing date'' 
for purposes of the phase-in periods in this section generally as 
the date the company's securities first trade on the Exchange.
    \14\ The ninety-day and one-year periods for the phase-in of the 
NYSE independence requirements for these two committees--as well as 
the one-year deadline for a company to satisfy the Exchange's 
requirement that a listed company have a majority of independent 
directors on its board--would begin from the date of listing.
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    The proposed rule change would allow a similar phase-in period for 
a company listing in conjunction with a spin-off or a carve-out 
transaction. In such transactions, there would need to be one 
independent director member on both the nominating and compensation 
committees by the date the transaction closes, at least a majority of 
independent director members on each committee within ninety days of 
the listing date, and fully independent committees within one year of 
the listing date. A company listing upon emergence from bankruptcy, for 
which the NYSE rules already provide a similar phase-in period, would 
continue to be required to have one independent director by the date of 
listing, as under the current rule. The same phase-in would be 
specified for a company that ceases to qualify as a controlled company 
and thereby loses its exemption from the independence requirements for 
these committees, but the first independent director member would be 
required to be in place for the nominating and compensation committees 
by the date the company's status changes.
    The NYSE also proposes to allow a company listing in conjunction 
with an IPO or a spin-off or carve-out transaction a phase-in period 
with respect to the provision in Section 303A.07(a) which requires a 
company to have a minimum of three members on its audit committee. Such 
companies would be required to have at least one member on their audit 
committees by the listing date, at least two members within ninety days 
of the listing date, and at least three members within one year of the 
listing date.\15\ This phase-in of the minimum size requirement would 
not be available to a company emerging from bankruptcy or a company 
ceasing to qualify as a controlled company. Such companies would still 
be required to have a minimum of three members on their audit 
committees from the date of listing on the NYSE or the date of the 
status change, as applicable.
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    \15\ As noted above, all the members of the audit committee must 
be independent as of the listing date unless a phase-in is permitted 
pursuant to Rule 10A-3. Thus, although NYSE rules would permit a 
phase-in of the number of members on the audit committee, all those 
members would still need to be independent (unless the company is 
allowed a phase-in of the Rule 10A-3 independence requirements). For 
example, a company listing in conjunction with a spin-off might have 
only two members on the audit committee on the date the transaction 
closes (and could have as few as one). However, both those members 
would still be required to be independent (assuming the company is 
ineligible for a phase-in of the Rule 10A-3 independence 
requirements).
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    NYSE proposes new rules for companies previously registered 
pursuant to Section 12(g) of the Act \16\ that list on the Exchange. 
Such companies would be required to have a majority independent board 
within one year of the listing date. Their nominating and compensation 
committees would be required to have at least one independent member by 
the listing date, a majority of independent members within ninety days, 
and fully independent members within a year of the listing date. Only 
independent directors would be permitted on the audit committee during 
the transition period (unless an exemption is available under Rule 10A-
3), but a phase-in would be permitted with respect to the committee 
size requirement: at least one independent director member as of the 
date of listing, two independent director members within ninety days of 
the listing date, and three independent director members within one 
year of the listing date.
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    \16\ 15 U.S.C. 78l(g).
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    A foreign private issuer is permitted to follow its home country 
practice in lieu of certain NYSE corporate governance standards for 
domestic listed companies. The proposed rule change would set forth a 
transition period for a foreign issuer that determines that it no 
longer qualifies as a foreign private issuer. The provision references 
Rule 3b-4 under the Act,\17\ which enables a foreign private issuer to 
test its status once a year on the last business day of its second 
fiscal quarter (``Determination Date''), and requires a foreign private 
issuer to comply with the reporting requirements and use the forms 
prescribed for domestic companies beginning on the first day of the 
fiscal year following the Determination Date.
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    \17\ 17 CFR 240.3b-4.
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    In addition, under Section 303A.08 of the NYSE standards, which 
concerns shareholder approval of equity compensation plans, a company 
that ceases to be a foreign private issuer would be granted a limited 
transition period with respect to discretionary plans and formula plans 
that were in place prior to the date that its status changed. A 
shareholder-approved formula plan could continue to be used after the 
end of the transition period if it is amended to provide for a term of 
ten years or less from the later of the date of its original adoption 
or its most recent shareholder approval. A formula plan could be used 
without shareholder approval if the grants after the date of the status 
change are made only from the shares available immediately before the 
Determination Date.
    Finally, pursuant to language proposed in various sections of the 
Introduction to Section 303A.00, the proposal would permit the various 
types of newly-listed companies to comply with requirements for listed 
companies to post certain documents on their websites (discussed above) 
by the same date they are required, respectively, to have at least one 
independent director member on their nominating and compensation 
committees.

C. Other Proposed Revisions

    The following section describes several of the other, more 
substantive changes included in the proposal:

[[Page 63810]]

    The Introduction to Section 303A would include Section 303A.08, 
``Shareholder Approval of Equity Compensation Plans'' in the list of 
sections with which closed end funds must comply.\18\ Securities listed 
under Section 703.22 of the Manual (``Equity Index-Linked Securities, 
Commodity-Linked Securities and Currency-Linked Securities'') would be 
included among the securities to which Section 303A does not apply 
(except as otherwise provided by Rule 10A-3 under the Act).
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    \18\ The Exchange states that the omission of this section in 
the current rule was an oversight.
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    Controlled companies, which are exempt from certain requirements, 
currently are defined as companies of which more than 50% of the voting 
power is held by an individual, a group, or another company. The 
definition would be revised to make clear that the 50% criterion 
relates specifically to voting power for the election of directors. The 
proposal also would clarify that references to a ``listed company'' or 
``company'' in the provisions relating to director independence 
include, in addition to any parent or subsidiary in a consolidated 
group with the listed company, any such other company as is relevant to 
any determination under the applicable independence standards of 
Section 303A.02(b).
    The proposal would allow companies to hold regular executive 
sessions of independent directors as an alternative to the sessions of 
non-management directors currently required. A company would be 
required to enable all interested parties, not only shareholders, to 
communicate concerns regarding the company to these non-management or 
independent directors.
    The Exchange proposes to add language to rule commentary in Section 
303A.07 regarding audit committees to make clear that, if a closed-end 
fund chooses to voluntarily include a ``Management's Discussion of Fund 
Performance'' in its Form N-CSR, its audit committee is required to 
meet to review and discuss it. The Exchange also proposes to clarify 
that telephonic conference calls constitute meetings if allowed by 
applicable corporate law.
    Section 303A.10, requiring a listed company to disclose to 
shareholders any waiver from its code of business conduct and ethics 
that is granted to an executive officer or director, would be amended 
to specify that the disclosure must be made within four business days 
of the determination by the company to grant the waiver, through a 
press release, Web site disclosure, or the filing of a current report 
on Form 8-K with the Commission.
    Finally, the Exchange proposes to amend provision (c) of Section 
303A.12 (Certification Requirements) to require each listed company to 
submit an interim Written Affirmation ``as and when required by the 
interim Written Affirmation form specified by the NYSE,'' as opposed to 
``each time a change occurs to the board or any of the committees 
subject to Section 303A.''

III. Discussion and Commission Findings

    After careful consideration of the proposed rule change and the 
comments received, the Commission finds that the proposal is consistent 
with the Act and the rules and regulations promulgated thereunder 
applicable to a national securities exchange and, in particular, with 
Section 6(b)(5) of the Act \19\ which requires that the rules of an 
exchange be designed, among other things, to prevent fraudulent and 
manipulative acts and practices; to promote just and equitable 
principles of trade; and in general, to protect investors and the 
public interest. The Commission further believes that the proposal is 
consistent with Rule 10A-3 under the Act \20\ concerning audit 
committee requirements for listed issuers.
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    \19\ 15 U.S.C. 78f(b)(5). In approving the proposal, the 
Commission has considered the proposed rules' impact on efficiency, 
competition and capital formation. 15 U.S.C. 78c(f).
    \20\ 17 CFR 240.10A-3.
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Corporate Governance Disclosures

    The Commission believes that it is reasonable for NYSE to revise 
its disclosure provisions in its corporate governance listing standards 
set forth in Section 303A of the Manual to align with the disclosure 
requirements of Item 407 of Regulation S-K, and to incorporate such 
standards by reference in those listing standards so as to reduce 
burdens on listed companies. The Commission notes that, as the Exchange 
has stated, companies that are deficient in their fulfillment of Item 
407 disclosure requirements will be deemed to be out of compliance with 
the Exchange's rules. Consequently, the Exchange will be able to take 
actions against a noncompliant company, ranging from appending a below 
compliance (``BC'') indicator to the company's ticker symbol, issuing a 
public reprimand letter, and, in appropriate cases, delisting.
    In the Commission's view, the proposal improves upon the current 
rules by stating clearly that a listed company must provide its Web 
site address when it discloses in its proxy statement or annual report, 
as required, that its key committee charters, code of ethics, and 
corporate governance guidelines are posted on its Web site. The 
Commission believes that it is reasonable for the Exchange to allow a 
company to fulfill its disclosure obligations with respect to these 
documents by posting them on its Web site, without having to provide 
them in print form. Certain of the disclosures required by the 
Commission's own rules are permitted to be made on a company's Web site 
as long as the company's proxy statement makes reference to the 
information and provides a Web site address.\21\
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    \21\ See, e.g., Instruction 2 to Item 407 of Regulation S-K. See 
also Securities Act Release No. 8732A; Securities Exchange Act 
Release No. 54302A; Investment Company Act Release No. 27444A 
(August 29, 2006), 71 FR 53158 (September 8, 2006).
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    As discussed above, the proposal also would allow a company to make 
certain other Exchange-required disclosures on its Web site instead of 
in its proxy statement or annual report, provided that the company 
states in the proxy statement or annual report that it has done so and 
provides the Web site address. The Commission believes that it is 
reasonable for the Exchange to provide companies with this alternative 
approach with respect to the specified disclosures. Similarly, the 
Commission believes that the amendments to the Exchange's listing rules 
governing disclosure by a foreign private issuer are appropriate.

Transition Periods for Newly-Listed Companies

    The Commission believes that the proposed amendments relating to 
the phase-in period for specified companies newly listing on the 
Exchange (or newly becoming subject to certain corporate governance 
listing standards as a result of change in status) are reasonable. The 
proposed rules would permit a phase-in schedule similar to that allowed 
under the current rules for a company listing in conjunction with an 
IPO, and would extend such a phase-in schedule appropriately to 
companies listing in conjunction with spin-off and carve-out 
transactions, while offering an acceptable minimal tolerance for the 
special circumstances of each of these types of new listings with 
respect to the point in time that the standards would begin to apply. 
The Commission notes that the Exchange's proposal does not make 
adjustments for compliance with any requirements of Rule 10A-3 under 
the Act.
    The Commission notes that a company listing upon emerging from

[[Page 63811]]

bankruptcy will still be required to have at least one independent 
director member on its nominating and compensation committees from the 
first day of listing (i.e., the day the security first trades on NYSE). 
A company that has relied on the exemptions available for controlled 
companies will be required to meet this standard as of the date its 
status changes.
    The proposed rule change also would allow a company listing in 
conjunction with an IPO, a spin-off, or a carve-out a phase-in period 
with respect to the NYSE requirement that the audit committee of a 
listed company have at least three members. In the Commission's view, 
permitting a company to have only one member on its audit committee by 
the listing date, at least two members within ninety days of the 
listing date, and three members within a year of the listing date, 
affords a reasonable accommodation for such companies. The Commission 
notes that a company emerging from bankruptcy will continue to be 
required to have at least three members on its audit committee from the 
day its securities begin to trade on the Exchange.
    The Commission further notes that the proposed rule change does not 
grant an exemption or phase-in period to any newly-listed company with 
respect to the provision set forth in Section 303A.07 of the Manual 
that requires every listed company's audit committee--without 
distinction as to the committee's size--to have at least one member who 
has accounting or related financial management expertise. In addition, 
Rule 10A-3 under the Act requires at least one member of a listed 
company's audit committee to be independent as of the listing date, 
even when the company is allowed a phase-in period with respect to the 
independence of other audit committee members.\22\ Thus, if a newly-
listed company that is eligible for a phase-in period with respect to 
the size requirement chooses to have initially only one member on its 
audit committee, that member would need to be independent and also to 
meet the NYSE financial expertise requirement.
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    \22\ See 17 CFR 240.10A-3(b)(1)(iv).
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    With respect to NYSE's Section 303A.08 governing shareholder 
approval of equity compensation plans, the Commission believes that it 
is reasonable for NYSE to incorporate the determination date in Rule 
3b-4 under the Act \23\ for a transition period for a company that 
ceases to be a foreign private issuer and to provide its issuers 
guidance on the continued use of formula plans, both with and without 
shareholder approval, after its status changes from a foreign private 
issuer.
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    \23\ 17 CFR 240.3b-4.
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Other Proposed Revisions

    The Commission understands that the Exchange proposes to clarify in 
the Introduction to Section 303A.00 that closed-end funds are subject 
to Section 303A.08. The fact that this provision does not currently 
appear to require closed-end funds to comply with Section 303A.08 
apparently results from an oversight on the part of the Exchange. The 
inclusion of securities governed by Section 703.22 of the Manual 
(Equity Index-Linked Securities, Commodity-Linked Securities and 
Currency-Linked Securities) among the list of preferred and debt 
securities to which the NYSE governance standards do not apply is an 
appropriate update of the rules and is consistent with NYSE's treatment 
of similar securities.\24\ The proposed amendment to the definition of 
a controlled company is a revision that has previously been filed with 
the Commission by another exchange as a ``non-controversial'' proposed 
rule change.\25\
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    \24\ See, e.g., Introduction to Section 303A.00 of the Manual, 
excepting Equity-Linked Debt Securities, Trust Issued Receipts, and 
Other Securities listed pursuant to Section 703.19 of the Manual, 
from certain corporate governance standards.
    \25\ See Securities Exchange Act Release No. 59424 (Feb. 19, 
2009), 74 FR 8831 (Feb. 26, 2009) (SR-NASDAQ-2009-009).
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    The Commission agrees with the Exchange that allowing companies to 
hold executive sessions of independent directors rather than of non-
management directors is consistent with the intention of the current 
rule. The proposal to require that all interested parties, not only 
shareholders, be able to communicate concerns regarding a listed 
company to the director(s) also is appropriate. The Commission further 
believes that it is appropriate to provide that if a closed-end fund 
voluntarily includes a Management's Discussion of Fund Performance in 
its Form N-CSR, its audit committee should be required to meet and 
review it.
    Currently, Section 303A.10 of the Manual provides that waivers of a 
company's code of business ethics and conduct must be ``promptly 
disclosed to shareholders'' and does not specify how such disclosure 
should be made. The proposed rule change sets a timeframe that is 
consistent with the requirements set by the Commission in Item 5.05 of 
Form 8-K \26\ regarding such waivers, and improves the listing standard 
by setting forth specific alternatives by which the disclosures may be 
made.
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    \26\ 17 CFR 249.308.
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    The proposal would remove the provision in Section 303A.12(a) that 
requires a company to disclose in its annual report to shareholders 
(or, if the company does not prepare an annual report, in its annual 
Form 10-K) the specified certifications regarding any non-compliance 
filed with the NYSE and the Commission. The Exchange states that that 
this provision has caused confusion because it relates to 
certifications made in the prior year. Further, the Commission now 
requires a company to provide certifications by its principal executive 
officer and principal financial officer as an exhibit to the company's 
Form 10-Q and 10-K, and the Commission's disclosure requirements now 
include detailed provisions relating to a company's obligation to file 
a Form 8-K in instances where the company notifies the Exchange or the 
Exchange notifies the company of non-compliance with Exchange listing 
standards. In addition, the NYSE appends a BC indicator to the ticker 
symbol of an issuer that is non-compliant with the Exchange's corporate 
governance standards. In view of these changes, the Commission agrees 
that it is reasonable to delete the certification disclosure 
requirement of Section 303A.12(a). The Commission also believes that it 
is reasonable to allow NYSE to modify Section 303A.12(c) to require 
companies to submit a Written Affirmation as and when required by the 
Exchange's interim Written Affirmation form, as opposed to each time a 
change occurs to the board or any of the committees subject to Section 
303A.
    The two comment letters on the proposed rule change generally 
support its revisions, but oppose the amendment to require the CEO of a 
company to notify the NYSE after any executive officer becomes aware of 
``any'' non-compliance with Section 303A, rather than ``any material'' 
non-compliance.\27\ The commenters believe that public companies should 
not be burdened with a duty to report minor or inadvertent breaches, 
and that investors could overlook material instances of non-compliance 
among the many inconsequential matters that would need to be reported 
under the proposal. One commenter was concerned that, upon notification 
of such matters, ``the NYSE may be compelled to include the company on 
the list of noncompliant companies (after the proper notice period) and 
to disseminate a BC indicator for that company over the

[[Page 63812]]

consolidated tape.'' \28\ This commenter states: ``Because the 
noncompliant company list and BC indicator give no further detail about 
the company's infraction or degree of noncompliance, investors may 
assume that a company is in danger of being delisted when only a 
relatively minor infraction exists.'' \29\
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    \27\ See supra, note 5.
    \28\ See Davis Polk Letter.
    \29\ Id.
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    The Commission believes that it is not unreasonable for the NYSE to 
require a company that is listed on its facility to notify the Exchange 
when it becomes aware that it is out of compliance with the Exchange's 
listing standards. With respect to the concern that the BC indicator 
provides no details about the reasons why the BC indicator was appended 
to the company's stock symbol, the NYSE's Web site provides the reason 
why a company has been placed on the non-compliant list.\30\
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    \30\ See http://www.nyse.com/regulation/nyse/bcindex.html. The 
Web site lists companies that are non-compliant with the Exchange's 
corporate governance listing standards separately from those non-
compliant with other standards, and states: ``A noncompliant issuer 
is added to the list seven business days after the NYSE notifies the 
issuer of the deficiency; if the noncompliance results from a death 
or illness of a director, the issuer is added to the list six months 
after the event. An issuer is removed from the list one business day 
after the NYSE determines that the issuer is in compliance with NYSE 
corporate governance listing standards.'' The reason why a company 
is on the list can be seen via a link entitled, ``View more 
information on issuers noncompliant with NYSE corporate governance 
standards.''
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    Finally, the Commission believes that the technical and other minor 
changes in the proposal improve and add to the clarity of the 
Exchange's corporate governance listing rules.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\31\ that the proposed rule change (SR-NYSE-2009-89), as amended, 
be, and hereby is, approved.
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    \31\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\32\
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    \32\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-28890 Filed 12-3-09; 8:45 am]

BILLING CODE 8011-01-P