Document ID: SEC-2007-1751-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: New York Stock Exchange LLC
Posted Date: 2007-12-26T05:00Z

[Federal Register: December 26, 2007 (Volume 72, Number 246)]
[Notices]               
[Page 73055-73056]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26de07-111]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56976; File No. SR-NYSE-2007-98]

 
Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing of Proposed Rule Change, as Modified by Amendment No. 
1 Thereto, to Reduce From Six Months to Three Months the Period for 
Which a Company's Average Global Market Capitalization Must Exceed the 
Levels Established by the Exchange's Pure Valuation/Revenue Test

December 17, 2007.
    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 October 29, 2007, New York Stock Exchange LLC (``NYSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been substantially prepared by the 
Exchange. On December 14, 2007, the Exchange filed Amendment No. 1 to 
the proposed rule change. \3\ The Commission is publishing this notice 
to solicit comments on the proposed rule change, as modified by 
Amendment No. 1, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The Exchange notes that Amendment No. 1 superseded the 
original filing in its entirety.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to reduce from six months to three months the 
period for which the average global market capitalization of 
prospective listed companies must exceed the levels established by the 
Exchange's ``pure valuation/revenue'' test contained in section 102.01C 
of the Exchange's Listed Company Manual (the ``Manual''). The text of 
the proposed rule change is included below. Proposed new language is 
italicized; proposed deletions are in [brackets].
NYSE Listed Company Manual
* * * * *
    102.01 Minimum Numerical Standards--Domestic Companies--Equity 
Listings
* * * * *
    102.01C A company must meet one of the following financial 
standards.
* * * * *
    (II) Valuation/Revenue Test Companies listing under this standard 
may satisfy either (a) the Valuation/Revenue with Cash Flow Test or (b) 
the Pure Valuation/Revenue Test.
* * * * *
    (b) Pure Valuation/Revenue Test--
    (1) At least $750,000,000 in global market capitalization, and
    (2) At least $75,000,000 in revenues during the most recent fiscal 
year*.
    In the case of companies listing in connection with an IPO, the 
company's underwriter (or, in the case of a spin-off, the parent 
company's investment banker or other financial advisor) must provide a 
written representation that demonstrates the company's ability to meet 
the $750,000,000 global market capitalization requirement based upon 
the completion of the offering (or distribution). For all other 
companies, market capitalization valuation will be determined over a 
[six]three-month average. In considering the suitability for listing of 
a company pursuant to the provision in the immediately preceding 
sentence, the Exchange will consider whether the company's business 
prospects and operating results indicate that the company's market 
capitalization value is likely to be sustained or increase over time.
* * * * *

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

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

1. Purpose
    The Exchange proposes to reduce from six months to three months the 
period for which the average global market capitalization of 
prospective listed companies must exceed the levels established by the 
Exchange's financial listing criteria contained in section 102.01C of 
the Manual.
    Section 102.01C requires companies listing under the Exchange's 
``pure valuation/revenue'' test to have a global market capitalization 
of $750 million. In the case of companies listing other than in 
connection with an initial public offering or a spin-off or upon 
emergence from bankruptcy, section 102.01C provides that the company 
must have met the required level of market capitalization on the basis 
of a six-month average. The Exchange believes that a reduction of this 
requirement from six months to three months will not diminish the 
quality of companies listing under the relevant tests. Rather, the 
Exchange believes that the primary effect of the proposed amendment 
would be to permit the earlier listing of companies that would 
ultimately qualify on the basis of a six-month average.\4\ In accepting 
companies that

[[Page 73056]]

have met the required market capitalization requirement for less than 
six months, the Exchange will consider whether the company's business 
prospects and operating results indicate that the company's market 
capitalization value is likely to be sustained or increase over time or 
whether more transient conditions have led to a valuation that is 
unlikely to be sustained.\5\
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    \4\ The Exchange notes that under The NASDAQ Stock Market LLC 
(``Nasdaq'') Global Market Standard 3, a company can list with $75 
million in market value of listed securities (sustained over 90 
consecutive trading days) and $20 million in market value of 
publicly held shares. See Nasdaq Rule 4420(c). The Exchange believes 
that, notwith- standing the proposed shift to a three-month from a 
six-month test period, the NYSE's ``pure valuation/revenue'' 
standard's requirement of a global market capitalization of $750 
million is far more stringent than Nasdaq Global Market Standard 3.
    \5\ See proposed rule text, supra Section I.
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2. Statutory Basis
    The proposed rule change is consistent with section 6(b)\6\ of the 
Act, in general, and furthers the objectives of section 6(b)(5),\7\ 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 facilitating transactions in securities, and to 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

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

    Written comments were neither solicited nor received.

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

    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. 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-NYSE-2007-98 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-NYSE-2007-98. 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, 100 F Street, 
NE., Washington, DC 20549, on official business days between the hours 
of 10 a.m. and 3 p.m. 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-NYSE-2007-98 and should be 
submitted on or before January 16, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
Florence E. Harmon,
Deputy Secretary.
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    \8\ 17 CFR 200.30-3(a)(12).
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 [FR Doc. E7-24889 Filed 12-21-07; 8:45 am]

BILLING CODE 8011-01-P