You are on page 1of 8

Federal Register / Vol. 71, No.

125 / Thursday, June 29, 2006 / Notices 37147

Electronic Comments SECURITIES AND EXCHANGE The text of the proposed rule change,
COMMISSION as amended, is available below.
• Use the Commission’s Internet Proposed new language is italicized;
comment form (http://www.sec.gov/ [Release No. 34–54029; File No. SR–NYSE– proposed deletions are in [brackets].
rules/sro.shtml); or 2005–68] * * * * *
• Send an e-mail to rule-
Self-Regulatory Organizations; New Listed Company Manual
comments@sec.gov. Please include File
Number SR–BSE–2006–22 on the York Stock Exchange, Inc. (a/k/a New * * * * *
subject line. York Stock Exchange LLC); Notice of 103.00 [Non-U.S. Companies] Foreign
Filing of Proposed Rule Change Private Issuers
Paper Comments Relating to Annual Financial Statement
The Exchange welcomes listing
Distribution Requirements and Listed
• Send paper comments in triplicate inquiries from [non-U.S. companies]
Company Manual Sections 103.00,
to Nancy M. Morris, Secretary, foreign private issuers. [It continues to
203.00, 203.01, 203.02, 203.03, 204.00
Securities and Exchange Commission, broaden its scope of trading in shares of
Through .33, 303A.14, 313.00, 401.04,
Station Place, 100 F Street, NE., internationally respected companies
and 703.09
Washington, DC 20549–1090. based in other countries. With the rapid
June 21, 2006. growth and need for capital of
All submissions should refer to File Pursuant to Section 19(b)(1) of the multinational companies and the
Number SR–BSE–2006–22. This file Securities Exchange Act of 1934 interdependence of the world’s
number should be included on the (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 economies, the Exchange is prepared to
subject line if e-mail is used. To help the notice is hereby given that on be the global marketplace.]
Commission process and review your September 30, 2005, the New York Foreign private issuers [Non-U.S.
comments more efficiently, please use Stock Exchange, Inc. (‘‘NYSE’’ or companies] may elect to qualify for
only one method. The Commission will ‘‘Exchange’’) filed with the Securities listing either under the Alternate Listing
post all comments on the Commission’s and Exchange Commission Standards for foreign private issuers
Internet Web site (http://www.sec.gov/ (‘‘Commission’’) the proposed rule [non-U.S. companies] or the Exchange’s
rules/sro.shtml). Copies of the change as described in Items I, II, and domestic listing criteria. [An applicant
submission, all subsequent III below, which Items have been company] The foreign private issuer
amendments, all written statements prepared by the NYSE. On June 9, 2006, must meet all of the criteria within the
the Exchange filed Amendment No. 1 to standards under which it seeks to
with respect to the proposed rule
the proposed rule change.3 The qualify for listing. For purposes of this
change that are filed with the
Commission is publishing this notice to Listed Company Manual, the terms
Commission, and all written
solicit comments on the proposed rule ‘‘foreign private issuer’’ and ‘‘non-U.S.
communications relating to the company’’ have the same meaning and
proposed rule change between the change, as amended, from interested
persons. are defined in accordance with the
Commission and any person, other than SEC’s definition of foreign private issuer
those that may be withheld from the I. Self-Regulatory Organization’s set out in Rule 3b–4(c) of the Securities
public in accordance with the Statement of the Terms of Substance of Exchange Act of 1934.
provisions of 5 U.S.C. 552, will be the Proposed Rule Change The Alternate Listing Standards are
available for inspection and copying in The Exchange’s proposed rule change designed to encourage major non-U.S.
the Commission’s Public Reference reflects amendments that eliminate the companies to list their shares on the
Room. Copies of such filing also will be current NYSE Listed Company Manual Exchange. Domestic listing
available for inspection and copying at requirement that listed companies requirements call for minimum
the principal office of the Exchange. All distribute an annual report to distribution of a company’s shares
comments received will be posted shareholders, specify more precisely within the United States, or in the case
without change; the Commission does certain requirements applicable to listed of North American companies, within
not edit personal identifying foreign private issuers, amend the North America. This is a major obstacle
information from submissions. You Exchange’s requirements for notices to for many large non-U.S. companies
should submit only information that and filings with the Exchange, add a which otherwise fulfill many times over
you wish to make available publicly. All new section to the Listed Company the normal size and earnings
submissions should refer to File Manual that specifically requires listed requirements for listing on the
Number SR–BSE–2006–22 and should companies to have and maintain a Web Exchange. The principal Alternate
be submitted on or before July 20, 2006. site, and reorganize and eliminate Listing Standards focus on worldwide
certain sections of the Listed Company rather than U.S. or North American
For the Commission, by the Division of distribution of a non-U.S. company’s
Manual.4
Market Regulation, pursuant to delegated shares.
authority.30 1 15 In addition to the minimum
U.S.C. 78s(b)(1).
Nancy M. Morris, 2 17 CFR 240.19b–4. numerical standards for listing, the
Secretary. 3 In Amendment No. 1, the NYSE eliminated from Exchange has established policies and
[FR Doc. E6–10242 Filed 6–28–06; 8:45 am] the present filing other proposed rule changes to requirements concerning certain
Sections 103 and 302 of the Listed Company corporate governance practices and the
BILLING CODE 8010–01–P Manual, and clarified certain details of its proposal.
Amendment No. 1 replaced and superseded NYSE’s reporting of interim earnings. For
original filing in its entirety. example, in many foreign countries,
jlentini on PROD1PC65 with NOTICES

4 See Telephone Conversation between controlling law or common practice


Annemarie Tierney, Assistant General Counsel, compel or permit the non-U.S. company
NYSE, and Raymond Lombardo, Special Counsel,
Division of Market Regulation, Commission and
to issue interim earnings reports on a
Rahman Harrison, Special Counsel, Division of semi-annual, as opposed to quarterly,
30 17 CFR 200.30–3(a)(12). Market Regulation, Commission, on June 20, 2006. basis or to have a class or classes of

VerDate Aug<31>2005 17:47 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
37148 Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices

common stock having more or less than 202.05 Timely Disclosure of Material filed with the SEC. This press release
one vote per share. News Developments must also indicate that shareholders
Other Exchange policies concerning A listed company is expected to have the ability to receive a hard copy
the corporate governance practices release quickly to the public any news of the company’s complete audited
required of domestic companies which or information which might reasonably financial statements free of charge upon
may not be consistent with the home be expected to materially affect the request. Companies must provide such
country laws or practices of non-U.S. market for its securities. This is one of hard copies within a reasonable period
companies include those which address the most important and fundamental of time following the request. Moreover,
the structure and composition of the purposes of the listing agreement which the press release must be published
Board of Directors, shareholder the company enters into with the pursuant to the Exchange’s press release
approval, quorum requirements for Exchange. policy (see Section 202.06 above).
shareholders’ meetings and related A listed company should also act A company that fails to file its annual
continued listing criteria. promptly to dispel unfounded rumors report on Forms 10–K, 20–F, 40–F or N–
[Where it appears to the Exchange which result in unusual market activity CSR with the SEC in a timely manner is
that a non-U.S. company’s interim or price variations. subject to the procedures in Section
earnings reporting or corporate The issuer of income deposit 802.01E.
governance practices are not prohibited securities traded as a unit shall [The Exchange requires that
by the law in the country in which it is publicize any change in the terms of the companies publish at least once a year
domiciled, such practices need not unit, such as changes to the terms and and distribute to shareholders an annual
necessarily be barriers to listing or conditions of any of the components report containing financial statements of
continued listing. In addition, the (including changes with respect to any the company and its consolidated
Exchange will permit non-U.S. issuers original issue discount or other subsidiaries prepared in conformity
to follow home-country practices significant tax attributes of any with generally accepted accounting
regarding the distribution of annual component), or to the ratio of the principles. The company must
reports to shareholders, if, at a components within the unit. Such distribute its annual report to its
minimum, (a) shareholders are provided publication shall be made as soon as shareholders not later than 120 days
at least summary annual reports, practicable in relation to the effective (225 days for Non-U.S. issuers) after the
including summary financial date of the change, and should close of each fiscal year.
information, (b) shareholders have the otherwise be made in accordance with Notwithstanding the foregoing,
ability, upon request, to receive an the procedures specified in [Para.] domestic issuers must make this
annual report that complies with the Section 202.06 below. In addition, the distribution at least fifteen days in
requirements of Para. 203.01 (a ‘‘full issuer must provide information advance of the annual meeting. (Non-
annual report’’), and (c) the financial regarding the terms and conditions of U.S. issuers are encouraged to do so
information contained in the summary the components of the unit (including when possible.) When the annual report
annual report is reconciled to U.S. information with respect to any original is distributed to shareholders, two
generally-accepted accounting issue discount or other significant tax copies should be sent to the Exchange
principles to the extent that such attributes of any component), and the together with advice as to the date of
reconciliation would be required in the ratio of the components comprising the distribution to shareholders.
unit[,] on its website [or, if it does not The company must distribute its
full annual report.
A non-U.S. issuer that seeks to use a maintain a website, in its annual report annual report to its shareholders not
summary annual report in lieu of a full to unit holders]. later than 120 days (225 days for Non-
annual report should contact its U.S. issuers) after the close of each fiscal
* * * * * year. Notwithstanding the foregoing,
Exchange representative to determine 203.00 Reporting Financial
whether the proposed use of the domestic issuers must make this
Information to Shareholders [Annual distribution at least fifteen days in
summary annual report would meet and Interim Reporting Requirements] advance of the annual meeting. (Non-
these requirements.] 203.01 Annual Financial Statement
To assist the Exchange in considering U.S. issuers are encouraged to do so
[Report] Requirement when possible.) When the annual report
the question of the listing or continued
listing of the securities of a non-U.S. Any company with voting or non- is distributed to shareholders, two
company whose interim earnings voting common securities listed on the copies should be sent to the Exchange
reporting or corporate governance Exchange that is required to file with the together with advice as to the date of
practices are not in compliance with SEC an annual report that includes delivery to shareholders.
audited financial statements (including Companies may satisfy the annual
Exchange requirements for domestic
on Forms 10–K, 20–F, 40–F or N–CSR) distribution requirement either by
companies, the non-U.S. company
is required to simultaneously make such distributing an annual report to
should furnish the Exchange with a
annual report available to shareholders shareholders, or by distributing to
written certification from independent
of such securities on or through the shareholders the Form 10–K (or Form
counsel in the country of the non-U.S.
company’s website. 20–F for Non-U.S. issuers) filed with the
company’s domicile as to whether or
Companies must also post to their SEC, with an indication that it is
not the non-complying practices are
website a prominent undertaking in the distributed in lieu of a separate annual
prohibited by home country law.
English language to provide all holders report. When the annual report (or Form
The Alternate Listing Standards for
(including preferred stockholders and 10–K or Form 20–F) is distributed to
non-U.S. companies apply only where
bondholders) the ability, upon request, shareholders, two copies should be sent
there is a broad, liquid market for the
to receive a hard copy of the company’s to the Exchange, together with advice as
company’s shares in its country of
jlentini on PROD1PC65 with NOTICES

complete audited financial statements to the date of delivery to shareholders.


origin.
free of charge. In addition, Distribution shall be in such format and
* * * * * simultaneously with this posting, the by such means as permitted or required
202.00 Material Information company must issue a press release by applicable law and regulation
* * * * * stating that its annual report has been (including any interpretations thereof by

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00117 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices 37149

the SEC). (See, for example, the public accountants who are qualified time limit on the basis of necessity, does
following interpretations by the SEC: under the laws of some state or country not feel free to do so on the basis of
Release No. 34–36345; File No. S7–31– and are subject to a code of professional convenience. For example it cannot
95; Release No. 34–37182, File No. S7– ethics of the professional accountancy consent to a delay in the issuance of the
13–96; and Release No. 34–42728, File body in that state or country. The statements just to make possible their
No. S7–11–00.) financial statements will be simultaneous distribution with the
A company that is unable to timely accompanied by a copy of the report proxy material.
file its Form 10–K or Form 20–F with issued by the independent public In the event of a delay in issuance of
the SEC must notify the Exchange prior accountants with respect to their the audited financial statements,
to the SEC filing deadline, explaining examination of such statements. unaudited earnings information, if
the reason for the delay and the (C) Form of Financial Statements expected to be substantially in
anticipated filing date. The Exchange agreement with the final audited figures,
The Exchange requires that all
will evaluate the circumstances and the should be released to the financial
financial statements contained in
continued listing status of the company, press. (See Para. 202.06(C) for details.)
annual reports to shareholders be in the
and at a minimum will require the If that procedure is not feasible, general
same form as the corresponding
company to issue a press release newspaper publicity should be given to
statements contained in the company’s
indicating the delay, the reason for the the audited figures as soon as they
original listing application or as
delay and the anticipated filing date. In become available without awaiting
modified to include the additional
making its evaluation, the Exchange will completion of the full, formal annual
disclosure agreed upon by the company
consider whether the company has report.]
and the Exchange. The statements are to
released or plans to release to the press * * * * *
be prepared in conformity with
information regarding its financial
generally accepted accounting 203.02 Interim Earnings [Reporting]
results for the fiscal year. Once the
principles. Release Requirement
company does file its Form 10–K (Form
20–F) with the SEC, it must then (D) General Information in Annual Any company with voting or non-
distribute to the shareholders an annual Report voting common securities listed on the
report or a Form 10–K (Form 20-F) in The Exchange recommends that the Exchange that is required to file interim
lieu thereof no later than 15 days (30 following information be included in all financial statements with the SEC is
days for a non-U.S. issuer) after the annual reports: required to release to the press an
filing. • Address of principal office. interim earnings release as soon as its
• Names of directors and officers. interim financial statements are
(A) Method of Publication
• Identification of directors available. See Section 202.06 above for
The Exchange requires publication of the Exchange’s press release policy.
the annual financial statements, as well comprising the Audit Committee and
other major committees of the Board of While the Exchange does not require
as their submission to shareholders. that the interim reports be sent to
While distribution of the statements Directors.
• Names and addresses of trustees, shareholders, as a matter of fairness,
to shareholders usually results in their
transfer agents and registrars. listed companies that distribute interim
receiving some publicity, to be sure of
• Number of employees. reports to shareholders should
news coverage, companies should
• Number of shareholders. distribute such reports to both registered
submit the statements, or a news release
and beneficial shareholders.
based thereon, to newspapers of general (E) Occasional Delay in Issuance of
circulation in large cities and to the Statements [(A) Time of Publication
national news wire services as described The probability of a delay in the No specific time limit for publication
in the ‘‘Immediate Release Policy.’’ (See issuance of annual financial statements of interim earnings statements has been
Para. 202.06(A).) In addition, the can ordinarily be foreseen. As soon as set, but it is assumed that such
statements, in the form in which sent to it becomes apparent that there may be statements will be published as soon as
shareholders, should also be sent to the a delay, the company should advise its available.
securities statistical services, in whose Exchange representative of the It is expected that, in this respect,
publications they will remain available circumstances and the probable extent each company will conform at least to
for ready public reference. of the delay. the pattern established by the majority
In the case of a company having only If the statements cannot be sent to of companies in its industry and, where
bonds listed on the Exchange, the shareholders at least fifteen days in the company has a previous record of
Exchange expects that the required advance of the annual meeting, it may publication of interim statements, to the
statements or news releases based be necessary for the company to pattern established by that previous
thereon be sent to the securities postpone the meeting or to adjourn it record.
statistical services and requires that without transaction of business to a date (B) Method of Publication
copies of the statements be sent to which shall be fifteen days after the The Exchange requires publication of
bondholders who request them. It also statements are issued. Whether or not interim statements as news items in the
urges that the statements, or news such postponement or adjournment will public press. It is not required that the
releases based thereon, be sent to be necessary can be determined only in statements be sent to shareholders. As a
newspapers of general circulation in the light of the particular circumstances. matter of fairness, corporations which
large cities and to the national news The matter should be discussed with the distribute interim reports to
wire services. Exchange representative as soon as the shareholders should distribute such
(B) Annual Statement to be possibility of the delay becomes reports to both registered and beneficial
jlentini on PROD1PC65 with NOTICES

Independently Audited apparent. shareholders.


The Exchange requires that all So far as the 120 day (225 day) time Whether or not the statements are sent
financial statements contained in limit stated in the first paragraph of this to shareholders, to be sure of adequate
annual reports of the company to its section Section 203.01 is concerned, the coverage the statements should be
shareholders be audited by independent Exchange, while ready to extend such released to newspapers and to the

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00118 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
37150 Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices

national news wire services, as annual statements of earnings, or As to many matters concerning which
described in the ‘‘Immediate Release interim statements reporting certain notice is required, some action on the
Policy.’’ (See Para. 202.06(A).) In operating statistics which will strive to part of the Exchange may be necessary
addition, they should be sent to the indicate the trend of the company’s and such action can only be taken on
securities statistical services. business during the period between the basis of direct, authoritative advice
Two copies of each interim earnings annual reports. from the company.]
statement, in the form released for While no fourth quarter statement is (B) Filings with the Exchange
publication, should be filed with the required, items of unusual or non- The Exchange[, as well as the SEC,]
Exchange. If the company sends interim recurrent nature occurring in the fourth requires that listed companies file hard
statements to its shareholders, two quarter should be reflected separately in copies of certain SEC reports and other
copies should be filed with the the full year earnings release.] materials (such as proxies [and
Exchange. * * * * * prospectuses]) with the Exchange. Since
(C) Form of Interim Financials [203.03 Distributing Annual and all [domestic and non-U.S.] listed
The listing agreement merely requires Interim Reports to Beneficial Owners of companies are required to file their
publication (quarterly or semi-annually, Stock] periodic and current reports, as well as
as the case may be), of a statement of In order to assure that annual and other materials, through the SEC’s
earnings; it does not require that such interim reports are distributed to Electronic Data Gathering Analysis and
statement be sent to shareholders. beneficial owners of stock held in street Retrieval (EDGAR) system, the Exchange
Interim earnings statements shall be on name by Exchange member [will access certain SEC documents
the same basis of consolidation as the organizations, Exchange Rules provide through that system and, except as
company’s annual financial statements that a member organization, when provided below,] will not also require a
and shall disclose, at a minimum, any requested by a company and given listed company to file hard copies of
substantial items of unusual or non- assurance that it will be reimbursed for most SEC filings with the Exchange.
recurrent nature and either net income all reasonable out-of-pocket and clerical Specifically, the Exchange only requires
before and after federal income taxes or expenses, is required to transmit copies companies to file:
net income and the amount of federal of annual and interim reports to each • one hard copy[ies] of materials
taxes. Additional information, and U.S. resident beneficial owner. This necessary to support a listing
particularly sales data, will, of course, requirement applies to both listed and application [(see Paras. 703.00 &
be useful to shareholders. unlisted companies. The Exchange has 903.00)] as required by Sections 702.04,
Such statements may cover each approved, as fair and reasonable, certain 703.00 and 903.00,
quarter individually or may cover, rates of reimbursement of member • six hard copies of proxy materials
cumulatively, the elapsed quarters of organizations for all out-of-pocket and not later than the date on which the
the current fiscal year; i.e., the statement clerical expenses incurred in connection material is physically or electronically
for the first quarter covering three with mailing annual and interim delivered to shareholders (see Section
months, that for the second quarter reports. See Para. 402.10 for full details 402.00),
covering six months and that for the • one hard copy of any filing[s] made
and current rates of reimbursement.]
third quarter covering nine months. on Form 6–K that is [are] not required
Publication, each quarter, of a statement * * * * * to be filed through EDGAR not later
covering the preceding twelve months is 204.00 Notice[s] to and Filings with than the date on which the Form 6–K is
not generally acceptable, although such [by the Company to] the Exchange filed with the SEC, and
moving-year statement may be included 204.00 Notice[s] to and Filings with • one hard copy of notice to
as a supplement to the individual or [by the Company to] the Exchange shareholders with respect to any
cumulative quarterly statement. (A) Prompt Written Notice to the proposed amendments to the company’s
It is recommended that each interim Exchange charter, as well as a certified copy of the
statement include like figures of the Prompt written notice from the listed amended charter along with a letter of
same period of the previous year, to company to the Exchange is required in transmittal indicating the sections
afford a basis for comparison. This connection with certain actions or amended since the previous filing of
device may be particularly useful in a events as specified in Sections 204.01 amendments or amended documents,
case where there is a seasonal cycle in through 204.25, [These notices are promptly following the date that the
the business. essential for the Exchange to exercise its notice is given or the charter is
(D) Exceptions to Policy self-regulatory responsibilities under the amended. Similar procedure shall be
Exceptions have been made to this Securities Exchange Act of 1934, followed with respect to resolutions of
requirement only in cases where including its function of providing a fair the Board of Directors, or any certificate
conditions peculiar to the type of and orderly market for a company’s or other document, having the effect of
company, or to the particular company securities. Filings required of the an amendment to the charter or by-laws.
itself, would make quarterly statements company under the 1934 Act do not * * * * *
impracticable or misleading, as in the satisfy the company’s obligation to give [204.03 Amendment of Charter or By-
case of companies dependent upon prompt written notice to the Exchange. Laws
long-term contracts, or companies Prompt written notice is required and Four copies of any notice to
dependent upon the growth and sale of is] in addition to notice required to be shareholders with respect to proposed
a crop in an annual cycle, or companies given through the Exchange’s telephone amendments to the company’s charter
operating under conditions which make alert procedures. (See [Para.] Section are required to be sent promptly to the
publication of quarterly statements 202.06(B).) Exchange.
jlentini on PROD1PC65 with NOTICES

virtually impossible. [While the Exchange does take note of When such amendments have become
In a case where the Exchange is advertisements, circulars, SEC filings effective, a certified copy is required to
convinced that quarterly statements are and news items appearing in the public be sent promptly to the Exchange.
impracticable, or misleading, it may press, such material is not acceptable as Similar procedure shall be followed
require an agreement to publish semi- authoritative advice from the company. with respect to resolutions of the Board

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices 37151

of Directors, or any certificate or other 204.[16]12 Dividends and Stock 204.ø31¿23 Rights or Privileges of
document, having the effect of an Distributions Listed Security Changed
amendment to the charter or by-laws. * * * * * * * * * *
If the company so desires, it may file 204.[17]13 Form or Nature of the 204.ø32¿24 Rights to Subscribe
copies of the charter or by-laws as Listed Securities Changed * * * * *
amended. If this is done, it will be
helpful if the amended documents are * * * * * 204.ø33¿25 Treasury Stock Changes
accompanied by a letter of transmittal 204.[18]14 Interest Payments * * * * *
indicating the sections amended since * * * * * 303A Corporate Governance Standards
the previous filing of amendments or 204.[19]15 Contingent Interest * * * * *
amended documents. Payments 14. Listed companies must have and
204.04 Annual Report * * * * * maintain a publicly accessible website.
The Exchange requires that two Commentary: To the extent that a listed
[204.20 Interim Earnings Statements
copies of the company’s annual report company is subject to the requirements
The Exchange requires that two of Sections 303A.04, .05, .07(c), .09 or
be provided to the Exchange when it is copies of each interim earnings
distributed to shareholders. These .10, each listed company’s website must
statement in the form released for include a printable version of the
reports should be accompanied by publication be filed promptly with the
notice to the Exchange as to the date applicable charters of its compensation,
Exchange.] nominating and audit committees, as
distributed to shareholders.] * * * * * well as its corporate governance
* * * * *
204.[21]16 Legal Proceedings guidelines and code of business conduct
204.[05]03 Auditors Changed * * * * * and ethics. In addition, a listed
* * * * * company that is a foreign private issuer
204.[22]17 Meetings of Shareholders
204.[06]04 Business Purpose Changed is required to include the disclosure
The Exchange is required to be given
required by Section 303A.11 on its
* * * * * at least ten days’ notice of the fixing of
website in the English language and
204.[07]05 Capital Surplus Charges a date for the closing of transfer books
such website must be accessible from
* * * * * in connection with any meeting of
the United States.
shareholders. See [Para. 204.29] Section
204.[08]06 Closing of Transfer Books 204.21. The notice should include the * * * * *
* * * * * record date and the meeting date. 313.00 Voting Rights
204.[09]07 Collateral Removed or * * * * * 313.00 Voting Rights
Changed 204.[23]18 Name Change * * * * *
* * * * * * * * * * (B) Non-Voting Common Stock
[204.10 Communications to The Exchange’s voting rights policy
204.[24]19 Nature of Business
Shareholders permits the listing of the voting
Changed
The company is required to send two common stock of a company which also
* * * * * has outstanding a non-voting common
copies to the Exchange of every
communication directed to 204.[25]20 Increases In Outstanding stock as well as the listing of non-voting
shareholders. Amount Of Securities[, Increases In] common stock. However, certain
* * * * * safeguards must be provided to holders
204.11 Control, Change of of a listed non-voting common stock:
[204.26 Press Release
The Exchange does not require notice (1) Any class of non-voting common
from the company in the event of a Two copies of any press release are
stock that is listed on the Exchange
change in control but relies instead required to be sent promptly to the
must meet all original listing standards.
upon filings made with it pursuant to Exchange.
The rights of the holders of the non-
the Securities Exchange Act of 1934.] 204.27 Prospectus voting common stock should, except for
* * * * * Seven copies of any prospectus or voting rights, be substantially the same
offering circular required to be used as those of the holders of the company’s
204.[12]08 Conversion Rate, Changes pursuant to the Securities Act of 1933 voting common stock.
* * * * * in connection with the sale of a listed (2) [The requirement that listed
204.[13]09 Decrease in Floating security are required to be filed companies publish at least once a year
Supply of Stock promptly with the Exchange. and submit to shareholders an annual
* * * * * 204.28 Proxy Material report (Para. 203.01) applies equally to
204.[14]10 Directors or Executive Six definitive copies of all proxy holders of voting common stock and to
Officers Changed material of the company are required to holders of listed non-voting common
be filed with the Exchange not later than stock.
Prompt notice is required to be given
the date on which such material is sent (3) In addition, a] Although the
to the Exchange of any changes in
to any security holder. holders of shares of listed non-voting
directors or executive officers of the
The Exchange urges that preliminary common stock are not entitled to vote
company. (Please also see Section
proxy material be submitted for review generally on matters submitted for
303A.12(c) which requires that listed
as more fully discussed in Section 4.] shareholder action, holders of any listed
companies file an interim written
non-voting common stock must receive
affirmation relating to changes to the 204.ø29¿21 Record Date
jlentini on PROD1PC65 with NOTICES

all communications, including proxy


board of directors.) * * * * * material, sent generally to the holders of
* * * * * 204.ø30¿22 Redemption of Listed the voting securities of the listed
204.[15]11 Disposition in Assets Securities company.
* * * * * * * * * * * * * * *

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
37152 Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices

401.00 Shareholders’ Meetings (D) [E] Supporting Documents companies also post such annual reports
* * * * * * * * * * to their corporate Web sites. In SR–
401.04 Interval between End of Fiscal NYSE–2001–40,9 the NYSE specified
II. Self-Regulatory Organization’s that U.S. companies were permitted to
Year and Annual Meeting of
Statement of the Purpose of, and use Commission-approved methods of
Shareholders
Statutory Basis for, the Proposed Rule electronic delivery to satisfy the annual
There is no Exchange requirement Change financial statement delivery
relating to the interval between the end requirement.
of a company’s fiscal year and the date In its filing with the Commission, the
Exchange included statements A recent Neilsen/Net Ratings study 10
of its annual meeting of shareholders. shows that 75% of Americans have
However, the Exchange believes that the concerning the purpose of, and basis for,
the proposed rule change and discussed access to the Internet in their homes,
annual meeting should be held within a and that those numbers are steadily
any comments it received on the
reasonable interval after the close of the increasing among all age groups. As a
proposed rule change. The text of these
fiscal year so that the information in the result, the NYSE believes that the vast
statements may be examined at the
annual report is relatively timely. majority of people in this country that
places specified in Item IV below. The
The standard Listing Agreement review company financials access them
Exchange has prepared summaries, set
requires that the annual report be sent online—either through the company’s
forth in sections A, B, and C below, of
to shareholders not later than 120 days own Web site, EDGAR, or some other
the most significant aspects of such
(225 days for non-U.S. issuers) after the service provider. The Exchange also
statements.
close of the company’s fiscal year and notes the Commission’s statement when
at least 15 days in advance of the annual A. Self-Regulatory Organization’s proposing changes in its Securities
meeting.] Statement of the Purpose of, and Offering Reform Act filing 11 that, ‘‘[a]t
* * * * * Statutory Basis for, the Proposed Rule this time, we believe that Internet usage
703.00 Subsequent Listing Change has increased sufficiently to allow us to
Applications and Debt Securities 1. Purpose propose a prospectus delivery model for
Applications issuers and their intermediaries that
The Exchange has long recognized the relies on timely access to filed
* * * * * importance of investors receiving information and documents.’’
703.09 Stock Option, Stock Purchase adequate financial information The Exchange believes that the ability
and Other Remuneration Plans Listing regarding listed companies and, in fact, to review a company’s financials
Process has required for many years that all electronically provides a more timely,
* * * * * listed companies distribute an annual efficient and cost effective method for
report including annual audited companies to provide and investors to
[(C) Disclosure of Options, etc. in
financial statements to their access current financial information.
Annual Report
shareholders.5 However, Rule 14a–3 6 of The proposed amendments to the
A listed company’s annual report to the Act has for many decades made that
shareholders should disclose the Exchange’s rules regarding annual
requirement redundant for most NYSE- reports reflect that current reality.
following information as to its option listed U.S. companies, since the
plans: For these reasons, the NYSE proposes
Commission rule requires companies to amend its rules to provide that
• The number of shares of its stock subject to the proxy rules to distribute companies can satisfy the annual
issuable under outstanding options at annual audited financials to financial statement distribution
the beginning of the year. shareholders with or prior to the requirement by making the company’s
• Separate totals of changes in the distribution of the annual meeting proxy annual report on Form 10–K, 20–F, 40–
number of shares of its stock under statement.7 The Commission’s proxy F or N–CSR available on or by a link
option resulting from issuance, exercise, rules do not apply to foreign private through its corporate Web site, with a
expiration or cancellation of options. issuers who are exempt as a result of prominent undertaking in English to
• The number of shares issuable Rule 3a12–3 of the Act.8 deliver a paper copy of the company’s
under outstanding options at the close Today all listed companies, U.S. and complete audited financial statements
of the year. foreign, are required to file annual free of charge to any shareholder who
• The number of unoptioned shares reports containing audited financial requests it. Listed companies will also
available at the beginning and at the statements prepared in accordance with be required to issue a press release
close of the year for the granting of or reconciled to U.S. GAAP (including simultaneously with their Web site
options under an option plan. on Forms 10–K, 20–F, 40–F and N–CSR) posting stating that their annual report
• Any changes in the exercise price of with the Commission via the Electronic has been filed with the Commission.
outstanding options, through Data Gathering, Analysis and Retrieval This press release must also indicate
cancellation and reissuance or system (EDGAR). Many of these that shareholders have the ability to
otherwise, except price changes
receive a hard copy of the complete
resulting from the normal operation of 5 This requirement is presently contained in

Section 203.01 of the Listed Company Manual. It audited financial statements free of
anti-dilution provisions of the options.]
can be traced back to an 1895 recommendation that charge upon request within a reasonable
(C) [(D)] Filing a Listing Application all listed companies send their shareholders an period of time.
Relative to Stock Option, Stock annual report with an income statement and The Exchange believes that existing
Purchase or Other Remuneration Plans balance sheet.
6 17 CFR 240.14a–3.
Commission requirements regarding
It is recommended that an application 7 The requirement to distribute annual reports in
for listing of unissued shares in Rule 14a–3 of the Act does not apply to registered 9 See Securities Exchange Act Release No. 45838
jlentini on PROD1PC65 with NOTICES

connection with a stock option, stock investment companies. However, registered (April 26, 2002), 67 FR 22144 (May 2, 2002) (SR–
investment companies, at least semi-annually, must NYSE–2001–40).
purchase or other remuneration plan be 10 See Three out of Four Americans Have Access
transmit reports to shareholders under Section 30(e)
filed as soon as possible after all of the Investment Company Act of 1940 and the to the Internet, Neilsen/NetRatings, March 18, 2004.
required corporate and shareholder rules thereunder. 11 See Securities Act Release No. 8501 (November

action has been taken. 8 17 CFR 240.3a12–3. 3, 2004), 69 FR 71126 (December 8, 2004).

VerDate Aug<31>2005 17:47 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00121 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices 37153

delivery of proxy statements mean that Section 802.01E of the Listed Company financials, these companies are required
the proposed rule changes will have Manual now provides a specific process to distribute two annual reports—one to
minimal effect on domestic companies for the requirements applicable to satisfy home country requirements and
subject to the proxy rules, but the companies that fail to file their required one to satisfy the NYSE’s requirements.
proposed changes will provide annual reports with the Commission by On the other hand, some NYSE-listed
significant efficiencies to listed foreign the required date, including a foreign private issuers are incorporated
private issuers exempt from the proxy requirement that a company issue a in countries that have no requirement to
rules under Rule 3a12–3 of the Act.12 press release disclosing the status of the distribute financials to stockholders, so
The Exchange also proposes to filing.13 Moreover, the Exchange the NYSE requirement is the only one
eliminate other elements of current monitors listed companies for timely mandating a physical distribution of
Section 203.01 of the Listed Company filing of their Commission reports on an annual financial statements.
Manual, including the requirement that ongoing basis.14 The Exchange proposes to amend
a company inform the NYSE if it is The Exchange also proposes to Section 103.00 of the Listed Company
unable to file its annual report with the eliminate language from Section 203.01 Manual to eliminate the requirement
Commission in a timely manner. Under of the Listed Company Manual that sets that foreign private issuers distribute to
the current rule, U.S. companies are out requirements that the annual shareholders at least a summary annual
required to distribute annual reports to financial statements be independently report that includes summary financial
shareholders no later than 120 days audited and prepared in accordance information reconciled to US generally
from the close of the fiscal year (225 for with generally accepted accounting accepted accounting principals and
foreign private issuers). In order to principals in light of the fact that these provide a full annual report to
police compliance with this distribution requirements reflect Commission rules shareholders upon request. Under the
requirement, the Exchange currently relating to the preparation of financial proposed changes to Section 203.01 of
requires that companies inform us of statements. the Listed Company Manual, foreign
delays in filing annual reports with the In light of the fact that the proposed
private issuers will be required to post
SEC. NYSE then considers the amendment to Section 203.01 of the
their annual report on Form 20–F or 40–
circumstances surrounding the delay in Listed Company Manual requires that
F to their Web site and to provide hard
determining whether to allow an companies post their annual reports
copies of the full audited, US GAAP
extension of time for the distribution of filed with the Commission to their Web
reconciled, financial statements to
annual reports past the required date. site, the Exchange proposes to add a
shareholders upon request within a
Due to the fact that under the rules as new section to the Listed Company
reasonable period of time. The Exchange
proposed, the Exchange will no longer Manual—Section 303A.14—that
also proposes to amend Section 103.00
be requiring the distribution of annual specifically requires listed companies to
have and maintain a Web site. This of the Listed Company Manual to
reports, the current language setting out
proposed section also collects into one eliminate the requirement that a
the timeframe by which annual reports
provision the information required company that proposes to distribute a
must be distributed will no longer be
under Section 303A of the Listed summary annual report contact an
applicable. As a result, the Exchange
Company Manual that listed companies Exchange representative to determine
proposes to eliminate this provision.
must post to their Web sites, including whether the proposed use of the
The Exchange notes that the
committee charters, corporate summary annual report meets the
Commission’s proxy rules set forth
requirements for U.S. companies on governance guidelines and their code of Exchange’s requirements. The Exchange
how far in advance of shareholder business conduct and ethics. believes that since companies will no
meetings proxies must be sent to Currently, Section 103.00 of the longer be required to distribute full or
shareholders, as well as requirements Listed Company Manual specifies that summary annual reports, this language
that such proxy be preceded or foreign private issuers must distribute is superfluous. NYSE also proposes to
accompanied by annual audited U.S. GAAP or U.S. GAAP reconciled eliminate language from the first and
financial information. financial statements in the form of an sixth paragraphs of Section 103.00 of
The Exchange also proposes to annual report, or summary annual the Listed Company Manual to the
eliminate the requirement that a report to shareholders. Since many extent that such language does not set
company notify the NYSE prior to the NYSE-listed foreign private issuers are forth actual listing requirements as part
filing deadline if it will not file its also required by home country law to of our overall effort to remove
annual report with the Commission on distribute home country financial superfluous language and guidance from
time, as well as the language setting out statements to shareholders months in the Listed Company Manual.
the date by which a company must advance of the completion of the U.S. Incidental conforming and cleanup
distribute its annual report once the late GAAP or U.S. GAAP reconciled amendments to the NYSE’s
annual report has been filed with the requirements relating to annual reports
Commission. The Exchange notes that 13 The Exchange has contracted with an outside are required to Sections 202.05, 203.03,
vendor to provide us with ongoing reports listing 204.00 through .33 and 313.00 of the
12 The Exchange notes that the Commission’s those companies that failed to file their annual or Listed Company Manual. These
proposed release on internet availability of proxy quarterly reports with the Commission on the
required date. The Exchange receives notification of proposed cleanup changes include
materials would, if adopted, provide companies an
internet posting alternative to the current these late filings on the next business day after the renumbering of sections and the
requirement for physical delivery or electronic filing due date. Exchange staff confirms via an elimination of references to annual
delivery only upon the consent of shareholders of EDGAR search that the listed filing is actually late report obligations throughout the Listed
such materials. See Securities Exchange Act Release and then programs an internal electronic alert that
notifies the applicable compliance staff member Company Manual, including with
No. 52926 (December 8, 2005), 70 FR 74598
(December 15, 2005). If adopted as proposed, the when the delinquent filing is subsequently made. respect to procedures relating to the
jlentini on PROD1PC65 with NOTICES

internet posting alternative in the Commission 14 See Telephone Conversation between distribution of annual reports. The
proposed release would not apply to the Annemarie Tierney, Assistant General Counsel, Exchange also proposes to restructure
requirement for every registered investment NYSE, and Raymond Lombardo, Special Counsel,
company to transmit reports to shareholders under Division of Market Regulation, Commission and
Sections 203.01 and 203.02 of the Listed
Section 30(e) of the Investment Company Act of Rahman Harrison, Special Counsel, Division of Company Manual to present our annual
1940 and the rules thereunder. Market Regulation, Commission, on June 20, 2006. and interim financial statement

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1
37154 Federal Register / Vol. 71, No. 125 / Thursday, June 29, 2006 / Notices

requirements in a more logical and Regulation S–K and on options issued including whether the proposed rule
orderly manner. as executive compensation pursuant to change is consistent with the Act.
The Exchange also proposes to amend Item 402 of Regulation S–K subsume the Comments may be submitted by any of
Section 204.00 of the Listed Company Exchange’s disclosure requirements, the the following methods:
Manual to consolidate and streamline Exchange no longer deems it necessary
the requirements for companies to to itself recommend specific disclosure Electronic Comments
provide notice to and file certain of these items, particularly in light of
documents with the Exchange. In • Use the Commission’s Internet
the proposed elimination of the
relation to this change, the Exchange comment form (http://www.sec.gov/
Exchange’s requirement that listed
proposes to limit the need for rules/sro.shtml); or
companies distribute an annual report
companies to provide information that to shareholders. • Send an e-mail to rule-
is available via the Commission’s comments@sec.gov. Please include File
Electronic Data Gathering Analysis and 2. Statutory Basis Number SR–NYSE–2005–68 on the
Retrieval (EDGAR) system or through The Exchange believes that its subject line.
electronic media alerts subscribed to by proposed rule change, as amended, is
the NYSE. For example, the Exchange consistent with Section 6(b) of the Act 15 Paper Comments
proposes to eliminate the requirement in general, and furthers the objectives of • Send paper comments in triplicate
that companies provide us with two Section 6(b)(5) of the Act 16 in to Nancy M. Morris, Secretary,
copies of every communication sent to particular, in that it is designed to
shareholders and with copies of press Securities and Exchange Commission,
prevent fraudulent and manipulative
releases as the appropriate Exchange Station Place, 100 F Street, NE.,
acts and practices, to promote just and
staff is automatically notified of EDGAR Washington, DC 20549–1090.
equitable principles of trade, to remove
filings or press release dissemination impediments to, and perfect the All submissions should refer to File
through electronic alert systems to mechanism of a free and open market Number SR–NYSE–2005–68. This file
which the Exchange subscribes. The and, in general, to protect investors and number should be included on the
Exchange also proposes to eliminate the public interest. subject line if e-mail is used. To help the
certain explanatory language from this Commission process and review your
section that the Exchange considers to B. Self-Regulatory Organization’s
Statement on Burden on Competition comments more efficiently, please use
be superfluous as a result of the
only one method. The Commission will
proposed changes. For example, the The Exchange does not believe that
Exchange no longer believes that it post all comments on the Commission’s
the proposed rule change, as amended,
needs to specify that advertisements, Internet Web site (http://www.sec.gov/
would impose any burden on
circulars and news items appearing in rules/sro.shtml). Copies of the
competition that is not necessary or
the public press are acceptable as appropriate in furtherance of the submission, all subsequent
authoritative advice of the company in purposes of the Act. amendments, all written statements
light of the clear list of items that must with respect to the proposed rule
be directly noticed or provided to the C. Self-Regulatory Organization’s change that are filed with the
Exchange. Statement on Comments on the Commission, and all written
The Exchange further proposes to Proposed Rule Change Received From communications relating to the
eliminate Section 401.04 of the Listed Members, Participants, or Others proposed rule change between the
Company Manual. This section provides The Exchange has neither solicited Commission and any person, other than
guidance regarding the interval between nor received written comments on the those that may be withheld from the
end of fiscal year and annual meeting of proposed rule change, as amended. public in accordance with the
shareholders. While the Exchange is not provisions of 5 U.S.C. 552, will be
disavowing that best practice would be III. Date of Effectiveness of the
Proposed Rule Change and Timing for available for inspection and copying in
to hold the annual meeting of the Commission’s Public Reference
shareholders at a reasonable interval Commission Action
Room. Copies of such filing also will be
after the close of the fiscal year, as part Within 35 days of the date of available for inspection and copying at
of overall efforts to streamline the publication of this notice in the Federal the principal office of the Exchange. All
provisions of the Listed Company Register or within such longer period (i) comments received will be posted
Manual, the Exchange has been as the Commission may designate up to
proposing on an ongoing basis to without change; the Commission does
90 days of such date if it finds such not edit personal identifying
eliminate sections that provide ‘‘best longer period to be appropriate and
practice’’ guidance, as opposed to information from submissions. You
publishes its reasons for so finding, or
requiring specific action. The Exchange should submit only information that
(ii) as to which the NYSE consents, the
ultimately intends that the Listed you wish to make publicly available. All
Commission will:
Company Manual will include only A. By order approve such proposed submissions should refer to File
those specific rules that listed rule change; or Number SR–NYSE–2005–68 and should
companies must satisfy in order to list B. Institute proceedings to determine be submitted on or before July 20, 2006.
and remain listed. whether the proposed rule change For the Commission, by the Division of
The Exchange further proposes a should be disapproved. Market Regulation, pursuant to delegated
cleanup of Section 703.09 of the Listed authority.17
Company Manual regarding disclosure IV. Solicitation of Comments
Nancy M. Morris,
of options, stock purchase and other Interested persons are invited to
jlentini on PROD1PC65 with NOTICES

remuneration plans. Due to the fact that Secretary.


submit written data, views, and
the Form 10–K requirements for [FR Doc. E6–10243 Filed 6–28–06; 8:45 am]
arguments concerning the foregoing,
comprehensive disclosure on options BILLING CODE 8010–01–P
available under equity compensation 15 15 U.S.C. 78f(b).
plans pursuant to Item 201(d) of 16 15 U.S.C. 78f(b)(5). 17 17 CFR 200.30–3(a)(12).

VerDate Aug<31>2005 17:03 Jun 28, 2006 Jkt 208001 PO 00000 Frm 00123 Fmt 4703 Sfmt 4703 E:\FR\FM\29JNN1.SGM 29JNN1

You might also like