

[Federal Register: March 28, 2006 (Volume 71, Number 59)]
[Notices]               
[Page 15499-15501]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28mr06-98]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53544; File No. SR-BSE-2005-46]

 
Self-Regulatory Organizations; Boston Stock Exchange, Inc.; 
Notice of Filing of Proposed Rule Change and Amendment Nos. 1 and 2 
Thereto to Amend Exchange Delisting Rules to Conform to Recent 
Amendments to Commission Rules Regarding Removal From Listing and 
Withdrawal From Registration

March 23, 2006.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\, and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on October 24, 2005, the Boston Stock Exchange, Inc. (``BSE'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by the BSE. 
On March 16, 2006, BSE filed Amendment No. 1 to the proposed rule 
change.\3\ BSE filed Amendment No. 2 to the proposed rule change on 
March 21, 2006.\4\ The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, BSE amended its rule text to clarify 
that an issuer that is below the continued listing policies and 
standards of the Exchange and seeks to voluntarily apply to withdraw 
a class of securities from listing must disclose that it is no 
longer eligible for continued listing in its statement of material 
facts relating to the reason for withdrawal from listing, its public 
press release, and its Web site notice. In addition, BSE revised its 
rule text to clarify which provisions in its appeal procedures were 
based on calendar or business days and to cross-reference its rules 
regarding the Exchange's basis for involuntary delisting of a class 
of securities by the Exchange.
    \4\ Amendment No. 2 replaced and superseded the Exchange's 
original Form 19b-4 in its entirety.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its rules regarding delisting 
securities. The text of the proposed rule change is below. Proposed new 
language is italicized.
* * * * *

RULES OF THE BOSTON STOCK EXCHANGE

Chapter XXVII Listed Securities--Requirements

SEC. 1. No change.

SEC. 2.

    (a) Voluntary Withdrawal from Listing
    An issuer proposing to withdraw a security from listing shall 
provide to the Exchange a certified copy of a resolution of the board 
of directors of the issuer authorizing withdrawal from listing. Once 
the copy is provided to the Exchange, the issuer must comply with 
Exchange Act Rule 12d2-2(c). Specifically, the issuer must: 1) comply 
with all applicable laws in effect in the state in which the issuer is 
incorporated; 2) provide written notice, which describes the security 
involved and all material facts relating to the reasons for withdrawal, 
to the Exchange no fewer then 10 days before the issuer files an 
application on Form 25 with the Securities and Exchange Commission; 3) 
publish notice, contemporaneous with providing written notice to the 
Exchange, through a press release, and if it has a publicly accessible 
website by posting such notice on that website, which shall remain 
available until the delisting on Form 25 becomes effective. Upon 
receipt of such notice from the issuer, the Exchange, as required by 
Rule 12d2-2(c)(3), shall post notice of

[[Page 15500]]

the issuer's intent on the Exchange website the next business day, and 
it shall maintain such posting until the delisting on Form 25 takes 
effect. The issuer must contemporaneously file a copy of Form 25 with 
the Exchange upon the submission of such form to the Securities and 
Exchange Commission. Once complete, the securities shall be removed 
from listing on the Exchange on the effective date established by 
Exchange Act Rule 12d2-2(d).
    (b) Involuntary Withdrawal From Listing
    Effective April 24, 2006, pursuant to Securities and Exchange Act 
Rule 12d2-2 for delisting and registration,\5\ where the Exchange is 
initiating the delisting from registration, for instances not provided 
in Rule 12d2-2(a), the Exchange may file an application to strike a 
class of securities from listing of such securities, where and issuer 
has fallen below the Exchange's continued listing policies and 
standards. (See Sec. 1) In such instances the Exchange shall:
---------------------------------------------------------------------------

    \5\ The effective date of Securities Exchange Act Release No. 
52029 (July 14, 2005), 70 FR 42456 (July 22, 2005) amending Rule 
12d2-2 is August 22, 2005. The compliance date is April 24, 2006. 
The BSE is incorporating the same compliance date into its rules.
---------------------------------------------------------------------------

    1. Provide notice to the issuer of its decision to delist its 
securities;
    2. Provide an opportunity to appeal to the Stock List Committee as 
follows:

Appeal Procedure

    A. A request to appeal the Exchange's decision to withdraw from 
listing shall be filed no later than five (5) business days following 
issuer's receipt of the decision. The request must include a five 
thousand dollar ($5,000) appeal fee. If the issuer does not request an 
appeal as specified, the Exchange shall submit to the Securities and 
Exchange Commission an application on Form 25 to strike the security 
from listing. A copy of Form 25 shall be provided to the issuer in 
accordance with Rule 12d2-2.
    B. If a request to appeal is received by the Exchange, the issuer 
will be entitled to present a written appeal before the Stock List 
Committee. The issuer may request a hearing with its request to appeal. 
However, the decision to grant an appeal hearing lies in the sole 
discretion of the Stock List Committee. Regardless of whether a 
hearing, if requested, is granted, the issuer must submit to the 
Exchange any documents or other written materials the issuer wishes to 
be considered within fifteen (15) calendar days of the filing of the 
notice to appeal. No hearing shall be held without giving five (5) 
business days notice to the issuer of the time and place for the 
hearing.
    C. The decision of the Stock List Committee shall be final. A 
written decision shall be served upon the issuer; and
    3. If the decision is that the security is to be withdrawn from 
listing then, in accordance with Rule 12d2-2, no fewer than ten (10) 
days before such action becomes effective, an application on Form 25 
shall be filed with the Securities and Exchange Commission. A copy of 
Form 25 shall be provided to the issuer. Public notice of the final 
determination to remove the security from listing shall be made by the 
Exchange by issuing a press release and posting notice on the Exchange 
Web site. This public notice will remain posted on the Web site until 
the delisting is effective.

* * * Commentary

    An issuer seeking to voluntarily apply to withdraw a class of 
securities from listing on the Exchange that has received notice from 
the Exchange that it is below the Exchange's continued listing policies 
and standards, or that is aware that it is below such continued listing 
policies and standards notwithstanding that it has not received such 
notice from the Exchange, must disclose that it is no longer eligible 
for continued listing (including the specific continued listing 
policies and standards that the issue is below) in: (i) its statement 
of all material facts relating to the reasons for withdrawal from 
listing provided to the Exchange along with written notice of its 
determination to withdraw from listing required by Rule12d2-2(c)(2)(ii) 
under the Exchange Act and; (ii) its public press release and web site 
notice required by Rule 12d2-2(c)(2)(iii) under the Exchange Act.
* * * * *

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 BSE 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 BSE 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 purpose of the proposed rule change is to conform the rules of 
the Exchange to the procedures recently established by the Commission 
for removing from listing, and withdrawal from registration, securities 
under Section 12(b) of the Act.\6\ As amended, Commission Rule 12d2-2 
(the ``Rule'') requires each national securities exchange seeking to 
delist and/or deregister securities to file an electronic application 
on Form 25 with the Commission. In addition, the Rule requires that the 
rules of the Exchange provide (1) notice to the issuer; (2) an 
opportunity for appeal; and (3) public notice.
---------------------------------------------------------------------------

    \6\ See Securities Exchange Act Release No. 52029 (July 14, 
2005), 70 FR 42456 (July 22, 2005).
---------------------------------------------------------------------------

    Specifically, Section 2(a) (Voluntary Withdrawal from Listing) 
revises and codifies the current practices of the Exchanges to conform 
to the Rule.\7\ Section 2(a) provides that any issuer seeking to 
voluntarily delist a security from an exchange must comply with all of 
the requirements of the Rule. The Commentary to the Rule clarifies that 
an issuer that is below the continued listing policies and standards of 
the Exchange and seeks to voluntarily apply to withdraw a class of 
securities from listing must disclose that it is no longer eligible for 
continued listing in its statement of material facts relating to the 
reason for withdrawal from listing, its public press release, and its 
Web site notice.
---------------------------------------------------------------------------

    \7\ While all of the rule text is new, the Exchange clarified 
which provisions of the rule text represented a codification of 
current Exchange practices. Telephone conversation between Maura 
Looney, Assistant Vice President, BSE, and Ronesha A. Butler, 
Special Counsel, Division of Market Regulation, Commission (March 
22, 2006).
---------------------------------------------------------------------------

    Section 2(b) (Involuntary Withdrawal from Listing) provides the 
procedures when the withdrawal of a security from listing is initiated 
by the Exchange as outlined in the Rule. Section 2(b)(1) codifies the 
current practice of the Exchange to provide notice to the issuer of its 
decision to delist a security. New Section 2(b)(2) provides the issuer 
with an opportunity to appeal to the Stock List Committee. Sections 
2(b)(2)(A)-(C) outline the issuers opportunity for a written appeal and 
hearing before the Stock List Committee. When an issuer files an 
appeal, a $5,000 appeals fee must accompany the request. New Section 
2(b)(3) conforms the current practices of the Exchange to comply

[[Page 15501]]

with the Rule. Section 2(b)(3) provides that the Exchange will give 
public notice of its final determination to delist the security by 
issuing a press release and posting a notice on its Web site. The 
public notice will remain on the Web site of the Exchange until the 
delisting is effective.
2. Statutory Basis
    The Exchange believes that its proposal, as amended, is consistent 
with the requirements of Section 6(b) of the Act,\8\ in general, and 
Section 6(b)(5) of the Act \9\ in particular, in that it is designed to 
promote just and equitable principles of trade, to remove impediments 
to and to perfect the mechanism of a free and open market and a 
national market system and is not designed to permit unfair 
discrimination between customers, brokers, or dealers, or to regulate 
by virtue of any authority matters not related to the administration of 
the Exchange.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    The BSE does not believe that the proposed rule change, as amended, 
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

    No written comments were either solicited or 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 BSE 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, as amended, is consistent with the Act. Comments may be 
submitted by any of the following methods:

Electronic Comments

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

File Number SR-BSE-2005-46 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-BSE-2005-46. This file 
number should be included on the subject line if e-mail is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments, all 

written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for inspection and 
copying in the Commission's Public Reference Room. Copies of the filing 
also will be available for inspection and copying at the principal 
office of the BSE. 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-BSE-
2005-46 and should be submitted on or before April 18, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Nancy M. Morris,
Secretary.
[FR Doc. 06-2996 Filed 3-23-06; 4:31 pm]

BILLING CODE 8010-01-P
