[Federal Register Volume 59, Number 64 (Monday, April 4, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-7968]


[[Page Unknown]]

[Federal Register: April 4, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-33827; File No. SR-BSE-94-4]

 

Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the Boston Stock Exchange, Inc. Relating to Its Listing 
Requirements

March 28, 1994.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on February 25, 1994, the 
Boston Stock Exchange, Inc. (``BSE'' or ``Exchange'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I, II and III below, which items have been 
prepared by the self-regulatory organization. The Commission is 
publishing this notice to solicit comments on the proposed rule change 
from interested persons.
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    \1\15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The BSE proposes to amend its listing requirements to impose more 
stringent criteria for initial listing of securities on the 
Exchange.\2\
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    \2\The BSE proposes to amend Chapter XXVII--Listing Securities--
Requirements  2260, Sec. 1, which outlines mandatory listing 
requirements for common stock. The Exchange generally proposes the 
following changes:
    A. The proposal would increase the company's tangible asset 
requirement to $2 million (up from $1.5 million) of $3 million in 
total assets. It would also specify that intangible assets shall 
include, inter alia, goodwill, patents, licenses, and trademarks and 
other assets as the Exchange shall deem intangible.
    B. The proposal would increase the required outstanding public 
float requirement to 750,000 shares (up from 500,000). It would also 
provide that the public float requirement shall be exclusive of 
shares held by directors, officers or other concentrated holdings of 
5% (down from 10%) or more.
    C. The proposal would increase the minimum number of beneficial 
stock holders required for listing to 750 (up from 500) beneficial 
stockholders exclusive of the holdings of directors, officers or 
other concentrated holdings of 5% (down from 10%) or more. 
Currently, with respect to companies seeking to list following an 
initial public offering, the Exchange must receive assurances from 
the company or its representatives that the minimum beneficial 
stockholder requirement be met following the distribution of the 
shares. If not met within six months of listing, the Exchange shall 
take immediate action to suspend dealings until the stockholder 
requirement is met. The Exchange proposes to add the following 
sentence to this section: Should the company fail to meet the 
requirement within 90 days of suspension, the Exchange shall file an 
application for delisting.
    D. The proposal would increase the minimum bid price per share 
to $2.00 per share (up from $1.00 per share) at the time of listing 
in the case of an initial public offering. It would also require a 
bid price of $2.00 (up from $1.00) to be maintained for 45 days (up 
from 30) prior to listing in the case of a company not involved in 
an initial public offering.
    E. The proposal would increase the net tangible asset 
requirement to $2 million (up from $500,000). The proposal would, 
therefore, provide that the company must have either net income of 
$100,000 in two of the past three years or net tangible assets in 
the amount of $2 million.
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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 self-regulatory organization 
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 self-regulatory organization 
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

    The purpose of the proposed rule change is to amend the listing 
requirements of the Exchange to establish minimum quantitative and 
qualitative requirements where practicable, to modernize and clarify 
the language of the rule, and to begin to respond to the Commission's 
concerns regarding certain issuers and promoters seeking listing solely 
as a means to avoid the requirements of SEC Rule 15c2-6.
    The statutory basis for the proposed rule change is Section 6(b)(5) 
of the Act in that it is designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to perfect the mechanism of a free and open market 
and a national market system, and in general, to protect investors and 
the public interest.

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

    The Exchange has neither solicited nor received comments on the 
proposed rule change, except from the Stock List Committee.

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

    Within 35 days of the publication of this notice in the Federal 
Register or within such other 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 self-regulatory organization consents, the Commission will:
    (A) By order approve the 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. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549. 
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 at the 
Commission's Public Reference Section, 450 Fifth Street, NW., 
Washington, DC 20549. Copies of such filing will also be available for 
inspection and copying at the principal office of the BSE. All 
submissions should refer to File No. SR-BSE-94-4 and should be 
submitted by April 25, 1994.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-7968 Filed 4-1-94; 8:45 am]
BILLING CODE 8010-01-M