[Federal Register Volume 65, Number 28 (Thursday, February 10, 2000)]
[Notices]
[Pages 6647-6664]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-3034]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42378; File No. SR-Amex-99-39]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the American Stock Exchange LLC Amending Certain Listing 
Standards

February 2, 2000.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 6648]]

(``Act'' \1\ and Rule 19b-4 thereunder, \2\ notice is hereby given that 
on September 28, 1999, the American Stock Exchange LLC (``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission the 
proposed rule change as described in Items, I, II, and III below, which 
Items have been prepared by the Exchange. The Exchange filed Amendments 
No. 1,\3\ 2,\4\ and 3,\5\ to the proposed rule change on December 14, 
1999, January 4, 2000, and January 19, 2000, respectively. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Letter from Michael Cavalier, Associate General Counsel, 
Legal & Regulatory Policy, Amex, to Jack P. Drogin, Assistant 
Director, Division of Market Regulation (``Division''), Commission, 
dated December 13, 1999 (``Amendment No. 1''). Amendment No. 1 
revises Section 1101 of the Amex Company Guide to add references to 
forms filed with the Commission by unit investments trusts and open-
end management investment companies.
    \4\ Letter from Michael J. Ryan, Jr., Chief of Staff, Amex, to 
Jack P. Drogin, Assistant Director, Division, Commission, dated 
December 31, 1999 (``Amendment No. 2''). As originally filed, the 
proposed rule change eliminated the requirement to submit with an 
original listing application certain corporate documents and an 
opinion of counsel regarding the legality of the organization, 
existence of the issuer, and the validity of the securities to be 
issued. Amendment No. 2 reinstates the requirement to submit these 
documents. Amendment No. 2 also makes certain technical changes to 
the proposed rule change.
    \5\ Letter from Michael J. Ryan, Jr., Chief of Staff, Amex, to 
Jack P. Drogin, Assistant Director, Division, Commission, dated 
January 18, 2000 (``Amendment No. 3''). Amendment No. 3 eliminates 
the requirement to file certain documents with an original listing 
application, including an issuer's charter and by-laws, as well as 
an opinion of counsel. In lieu of requiring these documents to be 
submitted, Amendment No. 3 states that the Exchange will ask issuers 
specific questions concerning quorum requirements, notice of record 
dates to schareholders and closing of transfer books. In addition, 
Amendment No. 3 states that the Exchange will require issuers to (i) 
furnish the Exchange with copies of opinions of counsel filed in 
connection with recent public offerings or private placements or 
(ii) if no opinions of counsel exist, represent to the Exchange that 
they are duly and validly organized under the laws of their state of 
incorporation. Finally, Amendment No. 3 reinstates Section 125 of 
the Amex Company Guide, relating to remedies available to 
bondholders upon default.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend certain provision of its listing 
standards to simplify the listing process, eliminate certain outdated 
processes, and to clarify the Exchange's alternative listing guidelines 
for domestic companies. The text of the proposed rule change is as 
follows. Proposed new language is in italic; deletions are in brackets.
* * * * *

Listing Standards, Policies and Requirements

PART 1. Original Listing Requirements--Listing Fees (Secs. 101-146)

CRITERIA FOR ORIGINAL LISTING (Secs. 101-118)

Sec. 101. GENERAL

    The approval of an application for the listing of securities is 
a matter solely within the discretion of the Exchange. To assist 
companies interested in applying for listing, the Exchange has 
established certain numerical guidelines, outlined below, which will 
be considered in evaluating listing eligibility. Other factors which 
will also be considered include the nature of a company's business, 
the market for its products, the reputation of its management, its 
historical record and pattern of growth, its financial integrity, 
its demonstrated earning power and its future outlook.
    The fact that an applicant may meet the Exchange's numerical 
guidelines does not necessarily mean that its application will be 
approved. On the other hand, an application may be approved even 
though the company does not meet all of the numerical guidelines.
    [The Exchange will furnish, without charge, a confidential 
preliminary opinion as to the eligibility of an applicant for 
listing as described in Sec. 202.]
    See Sec. [Sec. 's] 110 [and 115] for special criteria relating 
to foreign issuers [and member corporations] and Rules 1000, 1000A, 
and 1200 for rules relating to portfolio deposit receipts, Index 
Fund Shares, and Trust Issued Receipts.

(a) REGULAR LISTING CRITERIA

    ([a]1) Size--Stockholders' equity of at least $4,000,000.
    ([b]2) Income--Pre-tax income of at least $750,000 in its last 
fiscal year, or in two of its last three fiscal years.
    Additional criteria applicable to various classes of securities 
and issuers are set forth below. Applicants should also consider the 
policies regarding conflicts of interest, independent directors and 
voting rights described in Secs. 120-125.

(b) ALTERNATE LISTING CRITERIA [FOR DOMESTIC COMPANIES

    It is recognized that certain financially sound companies are 
unable to meet fully the Exchange's regular listing criteria 
because, for example, of the nature of their business, or because of 
continuing large expenditures of funds for research and development. 
Such companies may, however, qualify for listing provided they meet 
the numerical criteria outlined below, have sufficient financial 
resources to continue operations over an extended period of time, 
and are otherwise regarded as suitable for Exchange listing.
    Among the factors considered by the Exchange in determining a 
company's listing eligibility are the following:
    (a) the nature and scope of the applicant's operations, 
including its demonstrated ability to acquire or discover and 
develop new products or properties, the potential or proven market 
for existing or future products and the company's plans for future 
development and expansion of its existing resources;
    (b) the applicant's financial condition and accounting 
practices, its ability to service existing debt and other 
obligations, the availability of financing for currently committed 
programs and future expansion, and the size of its development 
expenses in relation to its equity and revenues;
    (c) the composition of the applicant's assets including its 
reserves, royalties, or other rights and patents;
    (d) the experience and reputation of the applicant and its 
management; and
    (e) the nature and effect of governmental policies or 
restrictions on the company's products or properties and the extent 
of competition and economic conditions within the particular 
industry.
    Numerical Criteria:]
    ([a]1) History of Operations--Three years of operations.
    ([b]2) Size--Stockholders' equity of at least $4,000,000.
    ([c]3) Distribution--See Section 102(a).
    ([d]4) Aggregate Market Value of Publicly Held Shares--
$15,000,000.

Sec. 102. EQUITY ISSUES

    (a) Distribution--Minimum public distribution \*\ of 500,000, 
together with a minimum of 800 public shareholders or minimum public 
distribution of 1,000,000 shares together with a minimum of 400 
public shareholders.

    Footnotes: \*\ The terms ``public distribution'' and ``public 
shareholders'' as used in the Company Guide include both 
shareholders of record and beneficial holders, but are exclusive of 
the holdings of officers, directors, controlling shareholders and 
other concentrated (i.e. [5]10% or greater, affiliated or family 
holdings.
* * * * *

Sec. 103. PREFERRED STOCK

    (a)-(c) no change
    [(d) Redeemable Issues--Redeemable issues, if subject to 
redemption in part, must be redeemable only pro rata or by lot. (See 
Sec. 902.)]

Sec. 104. BONDS AND DEBENTURES

* * * * *

[Redeemable Issues

    Redeemable issues, if subject to redemption in part, must be 
redeemable only pro rata or by lot. (See Sec. 902)]
* * * * *

Issuer or Bond Rating Status

    For the Exchange to list a debt security, the security must be 
characterized by one of the following conditions:
    (A) the issuer of the debt security has equity securities listed 
on the Exchange (or on the New York Stock Exchange or on the Nasdaq 
National Market);
    (B) an issuer of equity securities listed on the Exchange (or on 
the New York Stock Exchange or on the Nasdaq National Market) 
directly or indirectly owns a majority interest in, or is under 
common control with, the issuer of the debt security;

[[Page 6649]]

    (C) an issuer of equity securities listed on the Exchange (or on 
the New York Stock Exchange or on the Nasdaq National Market) has 
guaranteed the debt security;
* * * * *

Sec. 105. WARRANTS

    The listing of warrant issues is concerned on a case by case 
basis. The Exchange will not consider listing the warrant issue of a 
company unless the common stock or other securities underlying the 
warrants are listed and in good standing either on the American or 
New York Stock Exchanges or on the Nasdaq National Market and there 
are at least 200,000 warrants publicly held by not less than 100 
public warrantholders. In addition, to be listed, warrant issues are 
expected to meet the following criteria:
    (a) no change
    [(b) Redeemable (callable) Issues--Warrant, if subject to 
redemption in part, must be redeemable only pro rata or by lot. The 
Exchange requires advance notice of the Call Date (if any) as 
defined in its Warrant Agreement with the warrant agent(s). (See 
Sec. 902.)]
* * * * *

[Sec. 112. EXPLORATION AND DEVELOPMENT COMPANIES

    The Exchange generally will not list the securities of companies 
organized for the exploration and development of natural resources 
until they have reached the production stage and meet the criteria 
set forth in Sec. 101.]
* * * * *

[Sec. 115. MEMBER CORPORATIONS

    The following requirements and procedures will apply to the 
original listings of securities of publicly-owned member 
corporations:
    Minimum Standards:
    (a) Size-Stockholders' equity of at least $10 million. In 
determining a listing applicant's ability to meet this standard, the 
Exchange will value securities owned by the applicant at less than 
market value, depending upon the ready marketability of such 
securities. The applicant shall include in its listing application a 
list and the amounts of the securities owned by it, the names of the 
exchanges on which they are listed, and whether there are any 
restrictions against their sale as in the case of securities 
acquired for investment (``letter stock'').
    (b) Earnings-Pre-tax income of at least $1.5 million for the 
latest fiscal year.
    (c) Historical Operations--A history of satisfactory operations 
for at least 3 years prior to listing in order to demonstrate the 
applicant's ability to operate profitability under normal 
conditions. As in the case of all other listing applicants, all 
relevant factors regarding a member corporation's operations will be 
carefully considered, including the period of time in which present 
management has conducted the corporation's operations and the 
changes, if any, in management during the three year period under 
review.
    (d) Capital Ratios--A regular capital ratio which has not 
exceeded 10-to-1 (or an alternate capital ratio which has not been 
less than 5%) for any period of 15 consecutive days during the six-
month period preceding filing of the applicant's listing 
application.
    Procedures:
    In addition to the usual review procedures applicable to other 
types of corporations, the following special procedures will apply 
in reviewing member corporations for listing:
    (a) Reports received by the Exchange under FOCUS filing 
requirements will be reviewed and any problems indicated by such 
reports will be required to be satisfactorily resolved before 
listing. FOCUS reports will be required of any member corporation 
listing applicant not already filing them for a three-month period 
before consideration of the listing application.
    (b) In the case of an applicant which is also a member of the 
New York Stock Exchange, a copy of the report of the most recent 
examination by the New York Stock Exchange will be reviewed and any 
problems disclosed in such report must be satisfactorily resolved 
before listing.
    Disclosure:
    Any member corporation, which intends to list its securities on 
the Exchange, will be required to include in its prospectus 
additional disclosures with respect to certain regulatory actions 
which the Exchange (or the New York Stock Exchange) may take and 
which may have an adverse impact on the firm's future income and 
prospects. Among the actions which such Exchanges may take are:
    (a) limiting the opening of new offices, employment of new 
registered representatives, or opening of new accounts;
    (b) requiring an organization to cease business as a clearing 
organization and become solely an introducing broker;
    (c) restricting the types of activities which a member 
organization performs;
    (d) requiring an organization to reorganize or even to liquidate 
its business; and
    (e) requiring a listed member corporation to make timely 
disclosure of material information concerning its business, 
financial situation or prospects, or other matters which might have 
a bearing on its operations.
    In addition to publishing quarterly statements of revenues and 
earnings as required by the rules and regulations of the Exchange, a 
listed member corporation shall be required to distribute copies of 
such statements to its stockholders. Such quarterly reports, as well 
as the annual report, shall also contain a statement regarding the 
corporation's net capital position in relation to the standards of 
the Exchange and the New York Stock Exchange.
    A listed member corporation shall be required to file with the 
Exchange copies of its financial statements and questionnaires which 
it files with the New York Stock Exchange.]

[Sec. 116. COMPANIES ENGAGED IN GAMING OPERATIONS

    In addition to the many factors considered in the evaluation of 
any application for original listing (see Sec. 101), the Exchange 
will give particular attention to the historical record, operating 
procedures and management personnel of any applicant company which 
is engaged, to any substantial extent, in gaming operations. An 
applicant of this nature will be required to demonstrate that it has 
adequate procedures and management capabilities to detect and 
appropriately control any of the following:
    (a) the association with any person having a criminal background 
or who would not qualify for a license under any Federal, state or 
local regulatory requirements under which the applicant company 
operates;
    (b) any misuse of the company's funds or misappropriation of its 
receipts from gaming operations; or
    (c) any activities by persons associated either directly or 
indirectly with the company designed to promote the company's 
securities in contravention of the securities laws or to evade the 
disclosure requirements of the Exchange.
    Any of the following factors may be considered by the Exchange 
as a basis for refusing to approve the application of a company 
engaged in gaming operations:
    (a) if the company (or any predecessor organization that has 
been responsible for operating such gaming facilities), or any 
officer, director, controlling stockholder or managerial or 
supervisory employee of the company or of any such predecessor, or 
any other person having an association or relationship with the 
company or such predecessor whereby such person was, or is, in a 
position to influence management decisions with respect to, or to 
receive benefits from, the operation of such gaming facilities, has 
been convicted of any criminal offense relating to gaming or to any 
other business of the company or such predecessor, or relating to 
fraud, violation of the securities laws or violation of any Federal 
or state anti-racketeering or similar statutes, at any time during a 
period ten (10) years preceding the date of the application for 
listing;
    (b) if any person described in the preceding paragraph has been 
indicted or cited for violation of any Federal, state or local 
statute or ordinance relating to gaming or fraud, or has been denied 
a license or had his license revoked by any Federal, state, or local 
agency having jurisdiction over gaming operations, or any such 
person has been identified by an appropriate Federal or state agency 
as being associated with organized crime or with other persons 
conspiring to violate gaming or anti-racketeering statutes, at any 
time during a period of five (5) years preceding the date of the 
application for listing;
    (c) if any investigation (by any appropriate Federal, state or 
local agency) of the company, or of any predecessor or other person 
described in the first paragraph above, has disclosed any material 
violations of any law, rule or regulations applicable to the gaming 
operations of the company, during a period of five (5) years 
preceding the date of the application for listing;
    (d) if the company has in its employ, or has associated with it 
in any capacity, any person who, if required to be licensed in any 
Federal, state or local agency having jurisdiction over gaming 
operations, is not so licensed or has been denied a license or has 
been found to be unsuitable to receive a license;
    (e) if the company, or any predecessor or other person described 
in the first paragraph

[[Page 6650]]

above, shall have been finally determined to be liable for any 
income or other tax deficiency based upon an understatement of 
revenues or income from gaming activities, during a period of five 
(5) years preceding the date of the application for listing; or
    (f) if the company, or any predecessor described in the first 
paragraph above, shall have failed to received an unqualified 
opinion of an independent public accountant with respect to the 
balance sheet and statement of operations of the company or any such 
predecessor for each of the five (5) fiscal years preceding the date 
of the application for listing.
    In connection with the subsequent filing of any listing 
application by a company seeking to issue additional securities, the 
purpose of which is to enable the company to become engaged to a 
substantial degree in gaming or related activities, the Exchange 
will apply all of the above standards to the same extent as though 
the application were for original listing. Moreover, the Exchange 
will consider the suspension of trading in, or removal from listing 
or unlisted trading of, the securities of any company which, after 
the effective date of this policy, takes steps to become engaged in 
gaming operations to any substantial degree, unless the company can 
demonstrate that it meets all of the above special requirements for 
original listing of companies engaged in gaming operations.]
* * * * *

Sec. 118. INVESTMENT TRUSTS

* * * * *

A. INVESTMENT TRUSTS BASED ON SECURITIES OF INDIVIDUAL ISSUERS

    (a)-(d) no change
    [(e) Trustees--The requirements of paragraphs (a), (c) and (d) 
of Sec. 811 of the Guide apply.]
    ([f]e) Voting--no change
    ([g]f) Shareholder Communications--no change
    ([h]g) Listing Agreement--In addition to the above, an 
investment Trust applying for listing under this section of the 
Guide shall sign a listing agreement with the Exchange which, among 
other things, requires compliance with the following Exchange Rules 
and Regulations regarding:
    (i) Additional Listing--(see Part 3 of the Guide);
    (ii) Dividends, Stocks Splits and Distributions (see Secs. 501-
507 and 509 of the Guide);
    (iii) [Transfer Facilities, Certificates--(see Secs. 801-841 of 
the Guide);
    (iv)] Notification--comply with existing notification 
requirements of the Exchange.

B. INVESTMENT TRUSTS BASED ON STOCK INDEXES OR DEBT INSTRUMENTS

* * * * *
    The eligibility of a Trust for listing is subject to the 
following:
    (a) no change
    (b) no change
    (c) [Trustees--See Sec. 118A(a).
    (d)] Voting--When a share or unit has been divided into separate 
components, any voting rights accorded the share or unit may be 
divided between the component securities as specified in the Trust 
prospectus.
    ([e]d) Listing Agreement--See Sec. 118A([h]g).

CONFLICTS OF INTEREST

Sec. 120. POLICIES--CONFLICTS OF INTEREST, INDEPENDENT DIRECTORS AND 
VOTING RIGHTS (Secs. 120-126)

    [The existence of material conflicts of interest between 
companies and their officers, directors or principal shareholders 
(or members of their families or concerns controlled by, or 
affiliated with, them) will be reviewed by the Exchange in 
considering the eligibility of companies for original listing. In 
many cases, companies are able to eliminate conflict situations 
prior to listing or within a reasonable period after listing, and 
may be asked to do so. Where a conflict cannot be resolved promptly 
for sound business reasons, the Exchange will consider all pertinent 
factors.]
    Each company shall conduct an appropriate review of all related 
party transactions on an ongoing basis and shall utilize the 
company's Audit Committee or a comparable body of the Board of 
Directors for the review of potential conflict of interest 
situations where appropriate.
* * * * *

Sec. 125. REMEDIES AVAILABLE TO BONDHOLDERS UPON DEFAULT

    no change
* * * * *

OTHER REQUIREMENTS (Secs. 130-134)

Sec. 130. ORIGINAL LISTING APPLICATIONS

    Applicants must register the security to be listed under Section 
12(b) of the Exchange Act (Sec. 210) and submit an original listing 
application (Sec. 211). [Before doing so, they should first obtain a 
preliminary opinion as to eligibility (Sec. 202) which the Exchange 
will furnish without charge.]
* * * * *

Sec. 132. LISTING AGREEMENTS

    In addition to meeting the foregoing criteria, companies 
applying for listing enter into agreements with the Exchange and 
become subject to its rules, regulations and policies applicable to 
listed companies.
    Among other things, listed companies are required to:
* * * * *
    (e) [Transfer Facilities, Certificates--Establish facilities or 
agencies for the transfer and registry of stock and the payment of 
principal and interest on, and the registry or exchange of, bond or 
debenture issues (Secs. 801-841.) Requirements for engraving and the 
form of certificates for listed securities are also described in 
these sections;
* * * * *
    (g)]) Additional Information--upon request, furnish to the 
Exchange such information concerning the Company as the Exchange may 
reasonable require.
* * * * *

LISTING FEES (Secs. 140-146)

Sec. 140. ORIGINAL LISTING FEES

* * * * *
    Special Shareholder Rights Plans
    [A processing fee of $1,000 will be charged for special 
shareholder rights plans in lieu of the fees set forth in the above 
schedules, so long as such rights are neither exercisable nor 
tradable as a separate security.]
    Upon the shareholder rights becoming exercisable and tradabale 
separately:
     an original fee will be charged based on the number of 
shareholder rights then outstanding and on additional issuance of 
rights[, less the $1,000 processing fee;]
     shareholder rights will be subject to the Exchange's 
continuing annual fee schedule.

Sec. 141. ANNUAL FEES

    Stock Issues
* * * * *
    The annual fee is payable in January of each year and is based 
on the total number of all classes of shares ([including] excluding 
treasury shares) and warrants [outstanding at] according to 
information available on Exchange records as of December 31 of the 
preceding year. (The above fee schedule also applies to companies 
whose securities are admitted to unlisted trading privileges.)
    In the calendar year in which a company first lists, the annual 
fee will be prorated to reflect only that portion of the year during 
which the security has been admitted to dealings and will be payable 
in December based on the total number of outstanding shares of all 
classes of stock at the time of original listing.
* * * * *

Sec. 144. REFUNDS OF LISTING FEES (see also Sec. 141 above)

    (a) Applications Withdrawn or Not Approved--If a listing 
application is not approved by the Exchange or is withdrawn by the 
applicant, a service charge of $[250]1,000 is deducted by the 
Exchange from the listing fee previously paid by the applicant, and 
the balance is refunded to it. [If an applicant refiles an 
application after such a service charge has been deducted, the 
amount deducted is applied as a credit to the listing fee payable on 
the refiling, with the understanding that if the application is 
again withdrawn or not approved, a further service charge of $250 
will be deducted. This procedure applies to all further refilings.]
    (b) Credits After Approval--No cash refund of a listing fee is 
made where an application has been finally approved by the Exchange. 
If additional unissued shares are authorized for addition to the 
list ``upon official notice of issuance'' and all of such shares are 
not issued for the purpose specified in the application, a credit is 
allowed. The credit may be applied in full or partial payment of 
fees payable for future listing applications of the same company. 
The amount of the credit is the difference between the fee paid for 
the listing of such authorized shares and the fee which would have 
applied had the applications been initially submitted for the number 
of shares, which were actually issued and added to the list under 
the same listing authorization. If a company cancels all listing 
authorization pursuant to any single application (see Sec. 350), 
without the issuance

[[Page 6651]]

of any such shares, the Exchange makes a minimum charge of 
$[250]1,000.
* * * * *

PART 2. Original Listing Procedures (Secs. 201-222)

GENERAL (Secs. 201-207)

Sec. 201. STEPS

    There are normally [eight] seven steps in the listing process:
    (a) [company request preliminary listing eligibility opinion and 
receives favorable opinion;]
    (b)-(h) reclassified as (a)-(g)

[Sec. 202. PRELIMINARY OPINION PRIOR TO PREPARATION OF COMPLETE LISTING 
APPLICATION

    An applicant should obtain an informal and confidential opinion 
as to the eligibility of a particular issue for listing before 
preparing and filing a complete listing application. There is no 
charge for such opinion. The opinion may be obtained by sending the 
following data to the Exchange:
    (a) three copies of the latest prospectus and proxy statement of 
the company (if available);
    (b) three copies of printed annual reports distributed to 
shareholders for the last fiscal year and one copy of the annual 
report for preceding two years (if available) or financial 
statements for such years; five copies of SEC Form 10-K for latest 
fiscal year (if available); five copies of SEC Form 10-Q (if 
available) for interim periods since end of latest fiscal year; and 
one copy of each SEC Form 8-K filed since the latest Form 10-K;
    (c) a certificate showing the extent of the public distribution 
of the stock, to be furnished on a printed form (Listing Form 2) 
supplies by the Exchange;
    (d) information with respect to personal interests of any 
officers, directors or principal shareholders in any business 
arrangements involving the company such as the leasing of property 
to or from the company, interests in minority-held subsidiaries, 
interests in businesses that are competitors, suppliers or customers 
of the company, loans to or from the company, if not included in 
Form 10-K prospectus or proxy statement; and
    (e) information concerning material pending litigation if not 
included in Form 10-K, prospectus, or proxy statement.]

[Sec. 203. TIME SCHEDULE

    A preliminary listing eligibility opinion is normally rendered 
within one to two weeks after the opinion is requested. An 
additional two weeks is normally required for the complete 
processing of an application.]
* * * * *

Sec. 207. [Corporate Relations Manager] Listing Qualifications Analyst

    Each company is assigned to a [Corporate Relations Manager] 
Listing Qualifications Analyst, who serves as the principal liaison 
between the Exchange and the company on all regulatory and 
disclosure-related matters.

PREPARATION OF ORIGINAL LISTING APPLICATIONS (Secs. 210-218)

* * * * *

Sec. 211. ORIGINAL LISTING APPLICATION--GENERAL

    (a) [Initial Submission] form--[No prepared or blank forms are 
available for the listing application itself. The applicant prepares 
its own application, in typewritten narrative form, following the 
instructions outlined below. The Exchange will provide an 
appropriate sample application and assist in its preparation.]
    A [preliminary] typewritten [draft of the] listing application 
(signed by an executive officer of the applicant), together with all 
appropriate attachments, as outlined below, and one copy only of 
each of the required exhibits, should be [initially] filed with the 
Exchange for examination. If any deficiencies are noted, or any 
changes are considered necessary in the form or contents of the 
application and exhibits, the applicant will be notified.
    (b) Incorporation by Reference--A copy of the following 
documents should be attached to each original listing application 
submitted and the information contained therein may be incorporated 
by reference (see Sec. 212, Item 2):
    (i) no change
    (ii) no change
    (iii) no change
    (iv) [a certificate showing the extent of the public 
distribution of the stock, to be furnished on a printed form 
(Listing Form 2) supplied by the Exchange; and
    (v) information concerning material pending litigation if not 
included in Form 10-K, prospectus, or proxy statement; and
    (vi) a statement that there have been no material developments 
since the date of the latest SEC filing; and
    (vii)] such other information, documents or materials as may be 
deemed appropriate by the Exchange for inclusion in the applicant's 
listing application.
    (c) Listing Fee--A check drawn to the order of ``American Stock 
Exchange'' should accompany the [initial] submission. (See Sec. 140 
for computation of amount.)
    (d) Accounting Review--no change
    [(e) Final Application--The listing application need not be 
printed. Three (3) final copies of the application (with attachments 
listed in (b) above) shall be submitted with each copy manually 
signed by a duly authorized officer of the applicant.]

Sec. 212. CONTENT OF ORIGINAL LISTING APPLICATION--STOCK

    [An application for original listing of a stock issue shall 
recite, in substantially the order given below, the following:
    Item 1. Title Page, showing:
    (a) name of the applicant, address and telephone number of 
principal executive officer; and
    (b) date of application and formal request for listing; 
specifying the amount, class and par value of the security applied 
for.
    Application shall be made to list only that part of an issue 
which is actually issued, including both outstanding and treasury 
shares. If an additional unissued amount is reserved for issuance 
for a specific purpose, application may also be made for authority 
to add that amount to the list, upon official notice of issuance for 
that specific purpose. The request for authority to list such 
additional amount should state briefly, but specifically, the 
purpose of issuance, and that the listing authorization of such 
shares is effective only if they are issued for that purpose. No 
additional unissued amount may be applied for, which is not reserved 
for issuance for a specific purpose by the Board of Directors.
    If the applicant has any other classes of stock which are not 
being listed, the application should indicate how many such shares 
are outstanding, how many such shares are reserved for future 
issuance and the purpose thereof.
    Item 2, Attachments. A statement listing the appropriate 
documents which are attached to the listing application and 
incorporated therein by reference (see Sec. 211) and a statement 
that there have been no material developments since the date of the 
latest SEC filing.
    Item 3. Certificate. Certificate and signature of duly 
authorized officer of the applicant.]
    Each company must submit an application for original listing, in 
the form prescribed by the Exchange, together with supporting 
exhibits specified in Sec. 306 (See sample application in Appendix). 


Sec. 213. EXHIBITS TO BE FILED WITH ORIGINAL LISTING APPLICATION-STOCK

    [The following exhibits must be filed i] In support of the 
original listing application, a company must file:
    [1. Listing Agreement. O] one copy of the Listing Agreement, 
executed by an executive officer of the applicant, on Listing Form 1 
supplied by the Exchange. In addition,
    [2. Certificate of Distribution. One copy, signed by an 
executive officer of the applicant, as of a recent date, prepared on 
Listing Form 2 supplied by the Exchange.
    3. Charter. One copy each of charter and all amendments to date, 
with (manually signed) certificate(s) of Secretary of State or 
corresponding authority covering filing of the original charter and 
each amendment. In lieu of the foregoing, the applicant may submit a 
copy of the charter as amended to date, with (manually signed) 
certificate(s) of Secretary of State or corresponding authority with 
respect thereto. Photostatic copies are acceptable.
    4. By-Laws. One copy of the by-laws, as amended to date of 
application, certified by the secretary or other executive officer 
of the applicant.
    5. Specimen Certificates. One specimen copy of each denomination 
of certificate of class to be listed. If transfer agents(s) and 
registrar(s) are located in more than one city, furnish one specimen 
of each denomination of certificates used in each city. Specimens 
should he accompanied by certificate and agreement of the banknote 
company as specified under requirements for ``Form of Securities-
Engraving'' in the attached Appendix.
    6. Opinion of Counsel. One copy of opinion of counsel of 
satisfactory standing, addressed to the Exchange, as to the 
following: (a) the legality of organization and valid existence of 
the applicant; (b) the validity of authorization and issuance (or

[[Page 6652]]

proposed issuance) of the securities applied for; (c) whether the 
securities are (or will be) fully paid and non-assessable, and 
whether personal liability attaches to ownership; and (d) whether 
the outstanding securities were registered or issued pursuant to an 
exemption under the Securities Act.
    If counsel, or any partner of such counsel (or, if a firm, any 
member thereof) is an officer, director or shareholder of the 
applicant, this fact must be disclosed in the opinion and in the 
listing application.
    7. Contract With Transfer Agent. One copy of contract with each 
transfer agent relative to the issuance of additional shares. (Use 
printed Listing Form 3 supplied by the Exchange.)
    8. Contract With Registrar. One copy of contract of each 
registrar relative to the registration of additional shares. (Use 
printed Listing Form 4 supplied by the Exchange.)
    9. Other Information. T] the Exchange may request copies of such 
other documents as are necessary to complete its review of an 
issuer's eligibility for listing.

Sec. 214. OIL AND GAS AND MINING COMPANIES--ADDITIONAL PAPERS TO BE 
FILED

    Oil and Gas Companies--In addition to the [E] exhibits [1 to 9] 
required of all applicants, companies which have an interest in oil 
and gas properties as a material part of their business must submit 
the following:
    [10.] Engineer's Reserve Report. Report of recent date, of 
qualified engineer, including estimate of proven reserves. The 
report shall be accompanied by a signed statement of the engineer's 
qualifications. The Exchange recommends and may, in fact, require 
the submission of the report of a qualified independent engineer not 
in the regular employ of the company.
    Mining Companies--In addition to the [E] exhibits [1 to 9] 
required of all applicants, companies which own or operate mines as 
a material part of their business must submit the following:
    [11.] Table of Lands. A tabular list of mineral and other lands 
(separate lists for producing and non-producing properties), each 
property designated by number or claim name. If any property is held 
under lease, specify terms. Submit separate lists for properties 
held directly and those held through subsidiaries.
    [12.] Engineer's Mining and Reserve Report. Report, of recent 
date, of qualified engineer. The report shall be accompanied by a 
signed statement of the engineer's qualifications. (In certain 
cases, the Exchange may require the submission of the report of a 
qualified independent engineer not in the regular employ of the 
applicant.)
    In the case of mines which are developing, the engineer's report 
must contain:
    (a) recommendations regarding the development program; (by 
estimate as to amount of additional funds which will be required to 
complete the development program as outlined; and (c) estimate of 
length of time required to complete such development program.
* * * * *

[Sec. 216. EXHIBITS TO BE FILED WITH ORIGINAL LISTING APPLICATION--DEBT 
SECURITIES

    Applicants with no securities currently listed on the Exchange 
should submit all exhibits specified in Sec. 213, except for 
Exhibits 2, 6, 7 and 8, in lieu of which the following should be 
submitted:
    13. Opinion of Counsel. One copy of opinion of counsel of 
satisfactory standing, addressed to the Exchange, as to the 
following: (a) the legality of organization and valid existence of 
the applicant; (b) the validity of authorization and issuance of the 
bonds; (c) the legal, valid and binding nature of the obligations 
enforceable against the applicant in accordance with the terms of 
the instrument creating such bonds, with remedies exceptions, if 
appropriate; and (d) whether the Indenture is qualified under the 
Trust Indenture Act of 1939. If the bonds are convertible into 
equity securities of the applicant, an opinion should be given that 
the securities in to which the bonds are convertible have been duly 
and validly authorized and reserved for issuance and that they will, 
when issued, be fully paid and non-assessable, and that no personal 
liability will attach to ownership. The opinion should also indicate 
whether the bonds and, if applicable, the securities into which they 
are convertible, will be registered or issued pursuant to an 
exemption under the Securities Act.
    If counsel, or any partner of such counsel (or, if a firm, any 
member thereof) is an officer, director or shareholder of the 
applicant, this fact must be disclosed in the opinion and in the 
listing application.
    14. Indenture. One copy of the mortgage, indenture, or 
equivalent instrument, certified by the trustee.
    15. Trustee's Certificate. A certificate from the trustee 
showing acceptance of the trust. (See Appendix for suggested form.)
    Applicants with securities already listed on the Exchange should 
file supporting Exhibits 13-15 above, as well as Exhibits 1 and 5 
set forth in Sec. 213.]
* * * * *

[Sec. 218. EXHIBITS TO BE FILED WITH ORIGINAL LISTING APPLICATION--
WARRANTS

    Applicants with no securities currently listed on the Exchange 
should submit all Exhibits specified in Secs. 213-214, except for 
Exhibits 6, 7 and 8, in lieu of which the following should be 
submitted:
    16. Opinion of Counsel. One copy of opinion of counsel of 
satisfactory standing, addressed to the Exchange, as to the 
following: (a) the legality of organization and valid existence of 
the applicant; (b) the validity of authorization and issuance of the 
warrants; and (c) the legal, valid and binding nature of the 
obligations enforceable against the applicant in accordance with the 
warrant agreement, with remedies and exceptions, if appropriate. An 
opinion should be given that the securities for which the warrants 
are exercisable have been validly authorized and reserved for 
issuance and that they will, when issued in accordance with the 
warrant agreement, he validly issued, fully paid and non-assessable, 
and that no personal liability will attach to ownership. The opinion 
should also indicate whether the warrants and the securities into 
which they are exercisable will be registered or issued pursuant to 
an exemption under the Securities Act.
    If counsel, or a partner of such counsel, is an officer, 
director or shareholder of the applicant, this fact must be 
disclosed in the opinion and in the listing application.
    17. Contract with Warrant Agent. One copy of contract from 
warrant agent(s) on printed Listing Form 5.
    18. Warrant Agreement. One certified copy of warrant agreement 
between the issuer and warrant agent(s).
    In the case of applicants with securities already listed on the 
Exchange, the supporting Exhibits shall consist of 16, 17, and 18 
referred to above, plus Exhibits 1, 2 and 5 specified in Sec. 213.]

FOREIGN LISTINGS (Secs. 220-222)

* * * * *

Sec. 222. EXHIBITS TO BE FILED WITH ORIGINAL LISTING APPLICATION--
FOREIGN ISSUERS

    Generally, the exhibits to be filed in support of an original 
listing application of a foreign issue will be substantially the 
same as those pertaining to an equivalent domestic issue. [See 
Secs. 213, 216 and 219.)]
    Where an application is made to list ADRs, rather than the 
underlying securities, a copy of the Deposit Agreement and a 
specimen ADR certificate should also be filed in support of the 
listing application.

PART 3. Additional Listings-Requirements and Procedures--Subscription 
Rights--Possible Application of Original Listing

* * * * *

Sec. 304. LISTING OF SHARES PURSUANT TO A STOCK DIVIDEND OR FORWARD 
SPLIT

    Stock to be issued in a forward split or dividend must be listed 
prior to the distribution date of such action. A company must 
complete the Reconciliation Sheet provided in the Exchange's form of 
application, as of the record date of the scheduled distribution.
    If fractional shares are to be paid in cash and the exact number 
of shares cannot be determined in advance, the company should list 
the maximum number of shares that can be issued and subsequently 
request cancellation of the listing of the balance of shares not 
issued.
    [EXHIBITS--Exhibits A-2 and A-3 (described in Sec. 306) must be 
submitted in connection with a stock dividend or forward split 
listing application.]

Sec. 305. LISTING OF SHARES PURSUANT TO A REVERSE SPLIT/SUBSTITUTION 
LISTING

    A substitution listing application is necessary whenever a 
company engages in a reverse stock split, re-incorporates, proposes 
to list a new class of securities in substitution for a previously 
listed class of securities or otherwise engages in a transaction 
which would require it to file a new Form 8-A [or Form 8-B] with SEC 
in regard to a previously listed security.

[[Page 6653]]

    [EXHIBITS--Exhibits A-2, A-3, A-4, A-7, If applicable). A-8 and 
-9 (except in the case of a reverse split) (described in Sec. 306) 
must be submitted in connection with a reverse split or substitution 
listing application. In addition, if a company is changing its 
transfer agent and/or registrar a new Listing Form 3 (Agreement With 
Transfer Agent) and/or Listing Form 4 (Agreement With Registrar) 
must be executed and filed with the Exchange (see forms in 
Appendix).
    If a company is listing debt securities in substitution for a 
previously listed debt issue, it is also required to submit: (i) a 
specimen certificate of each denomination of security to be listed, 
with certification from the banknote company as specified in 
Sec. 823; (ii) a copy of the mortgage, indenture, or equivalent 
instrument (or amendments thereto) certified by the trustee with 
amendments; and (iii) a certificate from the trustee showing 
acceptance of the trust (see Sample Trustee's Certificate in 
Appendix).
    If a company is listing warrants in substitution for a 
previously listed warrant class, it is also required to submit: (i) 
a specimen certificate of each denomination of security to be 
listed, with certification from the banknote company as specified in 
Sec. 823; (ii) a copy of the contract with each warrant agent on 
Listing Form 5 (see form in Appendix); and (iii) a certified copy of 
the warrant agreement.]

Sec. 306. EXHIBITS TO BE FILED WITH ADDITIONAL LISTING APPLICATIONS

    A-1 Contract. A copy of each executed contract, plan or 
agreement pursuant to which the additional securities applied for 
are to be issued.
    A-2 [Opinion of Counsel. An opinion of counsel of satisfactory 
standing addressed to the Exchange as to the following: (a) the 
validity of authorization and issuance (or proposed issuance) of the 
securities applied for; (b) whether the securities are (or will be) 
fully paid and non-assessable, and whether personal liability 
attaches to ownership; and (c) whether the securities to be listed 
will be registered or issued pursuant to an exemption under the 
Securities Act. If such counsel, (or, if a firm, any member thereof) 
is an officer, director or stockholder of the applicant, this fact 
must be disclosed in the opinion.
    A-3 Board Resolutions. One certified copy of each resolution of 
the Board of Directors authorizing the issuance for which the 
listing application is being made, and
    A-4. Amendments to Charter. One copy of each amendment to the 
charter not previously filed with the Exchange, or, at the 
applicant's option, one copy of the charter as amended to date, 
certified by the Secretary of State or corresponding authority of 
the state of incorporation.
    A-5] Financial Statements of Acquired Company. If the securities 
to be listed are to be issued in connection with the acquisition of 
a controlling interest in, or of substantially all of the assets 
subject to the liabilities of, another company, the most recent 
audited financial statements, supplemented by the latest interim 
statements. In cases where independently audited financial 
statements are not available, a manually signed statement certified 
by the chief accounting officer of such other company must be 
submitted.
    A-[6]3. Engineering Report. If the securities applied for are to 
be issued in acquisition of a stock interest in another company, or 
properties or other assets, furnish one copy of any engineering, 
geological or appraisal report which may have been obtained in 
connection with the proposed acquisition.
    [A-7. Amendments to By-Laws. One certified copy of each 
amendment to the by-laws not previously filed with the Exchange. If 
desired, there may be filed in lieu of such amendments, one 
certified copy of the by-laws as amended to date.
    A-8. Stock Certificates. If the form of stock certificate for 
the listed class of stock has been or is to be changed, furnish one 
specimen of each denomination of the changed form, with a 
certification from the banknote company that the security has been 
prepared in accordance with the printing and engraving requirements 
of the Exchange, as specified in Sec. 823.]
    A-[9]4. Listing Agreement. A company must execute a new listing 
agreement (see Listing Form 1) in support of every substitution 
listing except in the case of a reverse split.
* * * * *

SUBSCRIPTION RIGHTS, BACKDOOR LISTING AND PAIRED SECURITIES (Secs. 340-
343)

Sec. 340. SUBSCRIPTION RIGHTS

    A listed company must promptly disclose any action taken by it 
with respect to the allotment of rights to subscribe or rights or 
benefits pertaining to the ownership of its listed securities. It is 
further required to give prompt notice of any such action to the 
Exchange to afford the holders of such securities a proper period 
within which to record their interests and exercise their rights. 
These requirements are further explained in paragraphs (a) through 
(h) below.
    The Exchange will not admit subscription rights to dealings 
unless the underlying security is or will be listed on the Exchange.
    (a) No change
    (b) Establishment of Record, Mailing, and Expiration Dates--The 
record date should be no earlier than one day prior to the time the 
registration statement or offering circular becomes effective.
    The mailing of the subscription rights to shareholders should 
occur as soon after the record date as possible. Most companies have 
their transfer agents mail the rights on the same date as the record 
date or, at the latest, on the business day following the record 
date.
    The subscription period should be for at least 14 calendar days 
following the mailing date. [provided the subscription agent is 
located in New York City. If the transfer agent (which usually also 
acts as the subscription agent) is not located in New York City or 
does not have a New York City ``drop'' (see Sec. 801), such 
additional number of days as is equal to the mailing distance 
between New York City and the location of the subscription agent 
should be added to the 14 day period. For example, if the sole 
subscription agent is located in Boston, without ``drop'' facilities 
in New York City, the subscription period should be at least 15 
days; in Chicago 16 days; and on the Pacific Coast 18 days. 
Companies not having a New York City transfer agent (or the 
equivalent thereof) should consider the advisability of appointing a 
New York City banking institution to act as subscription agent or 
co-subscription agent to facilitate the handling of subscriptions in 
relationship to the minimum subscription period involved.] (See 
Secs. 510-522 for further explanation of ``ex-rights'' rule.)
    (c) No change
    (d) No change
    (e) Dealings in Rights--No application is required to be filed 
with the Exchange for the listing of subscription rights or with the 
SEC for their registration under the Exchange Act. Under SEC Rule 
12a-4, subscription rights are exempt from registration under the 
Exchange Act. [Listed companies must, however, issue all 
transferable rights or benefits pertaining to listed securities in a 
form approved by the Exchange and make the same assignable, 
exercisable and deliverable in the Borough of Manhattan, City of New 
York.]
    Transferable rights may be admitted to dealings on the Exchange 
as soon as notice is received that the company's Securities Act 
registration statement or offering circular has become effective. 
The normal procedure is to admit the rights to dealings at 10:00 
a.m. on the day following the day the registration statement or 
offering circular has become effective. Accordingly, the company 
should arrange to have the registration statement or offering 
circular declared effective as of 4:00 p.m. on the date preceding 
the anticipated trading date. The company or its attorneys should 
notify the Exchange by telephone as soon as they learn of SEC 
clearance.
    Trading in rights on the Exchange will cease at the close of 
business on the business day preceding the expiration date thereof, 
if such rights are exercisable in the New York City metropolitan 
area, and at such time in advance of the expiration date as may be 
announced by the Exchange, if such rights are exercisable outside 
such area. (Exchange Rule 17.) This facilitates open contracts to be 
settled and rights to be exercised on the final day.
    (f) Ex-Rights Date--As specified at Sec. 513(a), in general, 
stocks are quoted ``ex-rights'' the day following the date on which 
the rights are admitted to dealings. (Exchange Rule 830.) This 
arrangement allows one full day's trading to take place in the 
rights to establish their market value for ``ex-rights'' purposes. 
On the day the stock is quoted ``ex-rights'' all open orders to buy 
and open stop orders to sell (pursuant to Exchange Rule 132, as 
amended) on the books of the specialist are reduced by the cash 
value of the rights as determined by the price of the last sale in 
the rights the day before the stock sells ex-rights. Purchasers of 
the stock beginning the fourth business day preceding the record 
date for a stock transferring in New York City [(and earlier if the 
stock transfers only outside of New York City)] and to and including 
the day

[[Page 6654]]

before the ``ex-rights'' date for the stock have been paying prices 
for their stock which include the value of the rights. Since it is 
not possible for such purchasers to become holders of record on the 
books of the company by the record date for the offering, the 
Exchange rules that the purchasers in such transactions (having paid 
a ``rights on'' price for their stock, i.e., a price including the 
value of the rights) are entitled to the rights and are, therefore, 
entitled to receive a due bill for the rights from the sellers of 
the stock. Such due bills are redeemed by the sellers when they 
receive their rights from the company.
    This arrangement is between the brokers for the purchasers and 
the sellers of the stock, and does not involve the company. For a 
further explanation, see Secs. 510-522.
    (g) No change
    (h) No change
* * * * *

[Sec. 343. SPECIAL SHAREHOLDER RIGHTS PLANS

    The Exchange should be consulted prior to the submission of any 
application involving securities with special shareholder rights. 
(See Sec. 140 for discussion of the fee.)]
* * * * *

PART 4. Disclosure Policies (Secs. 401-405)

DISCLOSURE (Secs. 401-405)

Sec. 401. OUTLINE OF EXCHANGE DISCLOSURE POLICIES

    The Exchange considers that the conduct of a fair and orderly 
market requires every listed company to make available to the public 
information necessary for informed investing and to take reasonable 
steps to ensure that all who invest in its securities enjoy equal 
access to such information. In applying this fundamental principle, 
the Exchange has adopted the following six specific policies 
concerning disclosure, each of which is more fully discussed (in a 
Question and Answer format) in Sec. 402:
    (a) Immediate Public Disclosure of Material Information--A 
listed company is required to make immediate public disclosure of 
all material information concerning its affairs, except in unusual 
circumstances. When such disclosure is to be made during trading 
hours, it is essential that the [company's Corporate Relations 
Manager] Stock Watch Department be notified prior to the 
announcement.
    (b)-(f) no change

Sec. 402. EXPLANATION OF EXCHANGE DISCLOSURE POLICIES

    (a) Immediate Public Disclosure of Material Information
* * * * *
    Q. When may a company properly withhold material information?
    A. Occasionally, circumstances such as those discussed below may 
arise in which-provided that complete confidentiality is maintained-
a company may temporarily refrain from publicly disclosing material 
information. These situations, however, are limited and constitute 
an infrequent exception to the normal requirement of immediate 
public disclosure. Thus, in cases of doubt, the presumption must 
always be in favor of disclosure.
    (i) no change
    (ii) When the facts are in a state of flux and a more 
appropriate moment for disclosure is imminent.
    Occasionally, corporate developments give rise to information 
which, although material, is subject to rapid change. If the 
situation is about to stabilize or resolve itself in the near 
future, it may be proper to withhold public disclosure until a firm 
announcement can be made, since successive public statements 
concerning the same subject (but based on changing facts) may 
confuse or mislead the public rather than enlighten it.
    For example, in the course of a successful negotiation for the 
acquisition of another company, the only information known to each 
party at the outset may be the willingness of the other to hold 
discussions. Shortly thereafter, it may become apparent to the 
parties that it is likely an agreement can be reached. Finally, 
agreement in principle may be reached on specific terms. In such 
circumstances (and assuming the maintenance of strict 
confidentiality), a company need not issue a public announcement at 
each stage of the negotiations, describing the current state of 
constantly changing facts, but may await agreement in principle on 
specific terms. If, on the other hand, progress in the negotiations 
should stabilize at same other point, disclosure should then be made 
if the information is material.
    Whenever material information is being temporarily withheld, the 
strictest confidentiality must be maintained, and the company should 
be prepared to make an immediate public announcement, if necessary. 
During this period, the market action of the company's securities 
should be closely watched, since unusual market activity frequently 
signifies that a ``leak'' may have occurred. This is one reason why 
it is important to keep the company's [Corporate Relations Manager] 
Listing Qualifications Analyst fully apprised of material corporate 
developments.
    Note: Federal securities laws may restrict the extent of 
permissible disclosure before or during a public offering of 
securities or a solicitation of proxies. In such circumstances (as 
more fully discussed below), a company should discuss the disclosure 
of material information in advance with the Exchange and the 
Securities and Exchange Commission. It is the Exchange's experience 
that the requirements of both the securities laws and regulations 
and the Exchange's disclosure policy can be met even in those 
instances where their thrust appears to be different.
    Q. What action is required if rumors occur while material 
information is being temporarily withheld?
    A. If rumors concerning such information should develop, 
immediate public disclosure becomes necessary. (See also 
``Clarification or Confirmation of Rumors and Reports'' on page 4-
7.)
    Q. What action is required if insider trading occurs while 
material information is being temporarily withheld?
    A. Immediate public disclosure of the information in question 
must be effected if the company should learn that insider trading, 
as defined in section 402(f), has taken or is taking place. In 
unusual cases, where the trading is insignificant and does not have 
any influence on the market, and where measures sufficient to halt 
insider trading and prevent its recurrence are taken, exemptions 
might be made following discussions with the Exchange. The company's 
[Corporate Relations Manager] Listing Qualifications Analyst, 
through the facilities of the Exchange's Stock Watch Department, can 
provide current information regarding market activity in the 
company's securities and help assess the significance of such 
trading.
* * * * *
    (b) Thorough Public Dissemination
    Q. What specific disclosure techniques should a company employ?
    A. The steps required are as follows:
    (i) Prior to Public Disclosure. The Exchange expects a company 
to notify [its Corporate Relations Manager] the Exchange's Stock 
Watch Department in advance of public disclosure of information 
which is non-routine or is expected to have an impact on the market 
for its securities. The Exchange, with the benefit of all the facts 
provided by the company, will be able to consider whether a 
temporary halt in trading, pending an announcement, would be 
desirable. A temporary halt in trading is not a reflection on the 
company or its securities, but provides an opportunity for 
disseminating and evaluating the information released. Such a step 
frequently helps avoid rumors and market instability, as well as the 
unfairness to investors that may arise when material information has 
reached part, but not yet all, of the investing community. Thus, in 
appropriate circumstances, the Exchange can often provide a valuable 
service to investors and listed companies by arranging for such a 
halt.
    (ii) At Time of Public Disclosure. As a minimum, any public 
disclosure of material information should be made by an announcement 
released simultaneously to: [(A)] the national business and 
financial news-wire services [(Dow Jones, Reuters, and Bloomberg), 
(B) the national news-wire services (Associated Press and United 
Press International), (C) The New York Times and The Wall Street 
Journal, and (D) Moody's Investors Service and Standard & Poor's 
Corporation. The New York telephone numbers and addresses of these 
organizations are as follows:

Dow Jones & Company, Inc. (The Wall Street Journal), World Financial 
Center, 200 Liberty Street, New York, N.Y. 10281, (212) 416-2471
Reuters Ltd., 1700 Broadway, New York, N.Y. 10019, (212) 603-3300
Bloomberg Business News, 499 Park Avenue, New York, N.Y. 10022, 
(212) 318-2000
Associated Press, 50 Rockefeller Plaza, New York, N.Y. 10020, (212) 
621-1500
United Press International, Five Penn Plaza, New York, N.Y. 10001, 
(212) 560-1100
The New York Times, 229 W. 43rd Street, New York, N.Y. 10036, (212) 
556-1234

[[Page 6655]]

Standard & Poor's Corporation, 25 Broadway, New York, N.Y. 10004, 
(212) 208-8377
Moody's Investors Service, Inc., 99 Church Street, New York, N.Y. 
10007, (212) 553-0300
    Concerns that distribute press releases over private [teletype] 
networks may be extremely helpful in gaining news coverage. Two such 
organizations are PR Newswire, [150 E. 58th St., New York, N.Y. 
10022 [(212) 832-9400 or (800) 832-5522 (outside New York)],] and 
Business Wire [, 1133 Avenue of the Americas, New York, N.Y. 10036 
[(212) 575-8822 or (800) 221-2462 (outside New York)]].
    Companies may also wish to broaden their distribution to other 
news or broadcast media, such as those in the location of the 
company's plants or offices, and to trade publications. The 
information in question should always be given to the media in such 
a way as to promote publication by them as promptly as possible, 
i.e., by telephone, telecopy, or in writing (by hand delivery), on 
an ``immediate release'' basis. Companies are cautioned that some of 
these media may refuse to publish information given by telephone 
until it has been confirmed in writing or may require written 
confirmation after its publication.
    Whenever difficulty is encountered or anticipated in having an 
announcement about a material development published, a company 
should contact [its Corporate Relations Manager who may frequently] 
The Exchange's Stock Watch Department, which may be able to provide 
assistance. Finally, if despite all reasonable efforts, the 
announcement has not been published by one of the national news-wire 
services or one of the above-mentioned newspapers, the company 
should attempt to have the announcement disseminated through other 
media, such as trade, industry or business publications, or local 
newspapers (especially those in the area where the company's 
principal offices or plants are located or where its stockholders 
are concentrated). In cases where the announcement is of particular 
importance, or where unusual difficulty in dissemination is 
encountered, the company should consider the use of paid 
advertisements, a letter to stockholders, or both.
    Companies may also disseminate information over the Internet. 
Information should not be made available over the Internet before 
the same information is transmitted to, and received by, the 
traditional news vendor services.
    Three copies of all public announcements should be sent to the 
Exchange. [Announcements can be telecopied to the Exchange at (212) 
306-1488.]
    Q. How does the policy on thorough public dissemination apply to 
meeting with securities analysts, journalists, stockholders and 
others?
* * * * *
    (c) Clarification or Confirmation of Rumors and Reports
    no change
    (d) Response to Unusual Market Action
    Q. What is the significance of unusual market activity from the 
standpoint of disclosure?
    A. Where unusual market action (in price movement, trading 
activity, or both) occurs without any apparent publicly available 
information which would account for the action, it may signify 
trading by persons who are acting either on unannounced material 
information or on a rumor or report, whether true or false, about 
the company. Most often, of course, unusual market activity may not 
be traceable either to insider trading or to a rumor or report. 
Nevertheless, the market action itself may be misleading to 
investors, who are likely to assume that a sudden and appreciable 
change in the price of a company's stock must reflect a parallel 
change in its business or prospects. Similarly, unusual trading 
volume, even when not accompanied by a significant change in price, 
tends to encourage rumors and give rise to speculative trading 
activity which may be unrelated to actual developments in the 
company's affairs.
    Generally, unusual market activity will first be detected by 
either the Specialist in the company's securities or the Exchange's 
Stock Watch Department[. This information will then be passed on to 
the company's Corporate Relations Manager, who], which in turn, will 
contact company officials to apprise them of the activity.
* * * * *

Sec. 403. CONTENT AND PREPARATION OF PUBLIC ANNOUNCEMENTS

    (a) Exchange Requirements
    no change
    (b) Securities Laws Requirements--The requirements of the 
Federal securities laws must also be carefully considered in the 
preparation of public announcements. In particular, these laws may 
impose special restrictions on the extent of permissible disclosure 
before or during a public offering of securities or a solicitation 
of proxies. Generally, in such circumstances, while the restrictions 
of the securities laws may affect the character of disclosure, they 
do not prohibit the timely disclosure of material factual 
information. Thus, it is normally possible to effect the disclosure 
required by Exchange policy.
    [Whenever a conflict arises, the company should discuss the 
matter with the Securities and Exchange Commission, as well as with 
its Exchange Corporate Relations Manager, who can frequently assist 
in evaluating the problem.]
    (c) Preparation of Announcements--The following guidelines for 
the preparation of press releases and other public announcements 
should help companies to ensure that the content of such 
announcements will meet the requirements discussed above:
    (ii) no change
    (iii) Since skill and experience are important to the 
preparation and editing of accurate, fair and balanced public 
announcements, the Exchange recommends that a limited group of 
individuals within the company be given this assignment on a 
continuing basis. (Since a press announcement usually must be 
prepared and released as quickly as possible, however, the group 
charged with this assignment should be large enough to handle 
problems that arise suddenly and unexpectedly.) The [company's 
Corporate Relations Manager] Exchange's Stock Watch Department can 
assist in assessing whether the release satisfies the Exchange's 
disclosure requirements.
    (iv) no change

Sec. 404. EXCHANGE SURVEILLANCE PROCEDURES

    [As previously noted, the Corporate Relations Managers are 
primarily responsible for the day-to-day relations with listed 
companies. They are familiar with the affairs of their assigned 
companies and are connected by direct wire to the trading floor of 
the Exchange. They also maintain close contact with the Exchange's 
Stock Watch Department, which is responsible for monitoring unusual 
market situations.]
    In many cases, when unusual market action occurs, [it is 
reported to the assigned Corporate Relations Managers. In many 
cases, by checking with] Stock Watch[, the Corporate Relations 
Managers] is able to trace the reason for the action to a specific 
cause, such as recently disclosed information, recommendations by 
advisory services, or rumors. In certain instances, the Exchange's 
Market Surveillance Department may also be asked to check brokerage 
firms as to the source and reasons for activity stemming from their 
particular firms. (This latter information, it should be noted, must 
remain confidential to the Exchange.) If no explanation of the 
unusual activity is revealed, [the Corporate Relations Managers] 
Stock Watch may call officials of the company to determine whether 
the cause of the action is known to them. If the action appears to 
be attributable to a rumor or report, or to material information 
that has not been publicly disseminated, the company is requested to 
take appropriate corrective action, and it may be advisable, after 
consultation with trading floor officials, to halt trading until 
such action has been taken.

[Sec. 405. CONSULTATION WITH EXCHANGE CORPORATE RELATIONS MANAGERS

    A company expecting to make a material corporate announcement 
should first contact its Corporate Relations Managers who is in a 
unique position to evaluate disclosure problems as they arise and 
explain their effect on the public, the company and the Exchange. By 
means of such advance consultation, effective liaison between 
companies and the Exchange is maintained, and a company can obtain 
the benefit of the Representative's experience in the day-to-day 
application of the Exchange's policies relating to corporate 
disclosure.]

PART 5. Dividends and Stock Splits (Secs. 501-522)

NOTICES, RECORD DATE (Secs. 501-509)

Sec. 501. NOTICE OF DIVIDEND

    no change

Sec. 502. RECORD DATE

    A company is not permitted to close its stock transfer books for 
any reason, including the declaration of a dividend. Rather, it must 
establish a record date for shareholders entitled. To a dividend 
which is at least ten days after the date on which the dividend is 
declared (declaration date). [However, in the

[[Page 6656]]

case. Of stock issues that do not have transfer facilities in the 
New York City metropolitan area, the record date shall not be less 
than such number of additional days (in excess of ten) after the 
declaration date as is equal to the mailing time (regular mail) 
between New York City and the city in which the Transfer Agent is 
located.

    Note: The requirement for additional time between the 
declaration date and the record date would also apply in cases where 
there is an intervening holiday or where the record date falls on a 
weekend.]
    A company is also required to give the Exchange at least ten 
days' notice in advance of a record date established for any other 
purpose, including meetings of shareholders.

Sec. 503. FORM OF NOTICE

    Immediately after the board of directors has declared a cash or 
stock dividend, the company should: (a) release the news to the 
newspapers and news services, including the news-ticker services 
operated by Dow Jones & Company, Inc., and Reuters Ltd., (see 
Sec. 402); and (b) notify the Exchange by telephone[, telegram] or 
[telecopier] facsimile and confirm by letter. The announcement and 
notice should specify the name of the company, date of declaration, 
amount (per share) of the dividend, and the record and payment 
dates.
* * * * *

EX-DIVIDEND-EX-RIGHTS (Secs. 501-522)

Sec. 512. EX-DIVIDEND PROCEDURE

    [In the establishment and announcement of ex-dividend dates, the 
Exchange proceeds as follows:
    Transfer Facilities Located in New York City] Transactions in 
stocks (except those made for ``cash'') [for which there exist 
transfer facilities in New York City (see Sec. 801)] are ex-dividend 
on the second business day preceding the record date. If the record 
date selected is not a business day, the stock will be quoted ex-
dividend on the third preceding business day. ``Cash'' transactions 
are ex-dividend on the business day following the record date.
* * * * *

[Sec. 520. SCHEDULE FOR CUSTOMARY EX-DIVIDEND DATES

    The ``ex-dividend'' date established by the Exchange is based on 
the location of the transfer facilities either in, or nearest to, 
New York City. Thus, if an issue transfers both in New York City and 
outside of New York City, the ``ex'' date is based on the New York 
City transfer facilities. If an issue does not transfer in New York 
City, but transfers in two or more cities outside of that area, the 
``ex'' date is based on the location of the transfer facilities 
closest to New York City.
    To avoid unnecessary claims for dividends, members receiving 
deliveries of stocks against ``dividend on'' transactions, are urged 
to provide for the early mailing of such stocks which transfer out 
of town, in order to ensure receipt by the transfer agent by the 
record date.]

Sec. 521. SPECIAL EX-DIVIDEND RULINGS

    (a) no change
    (b) no change
    (c) ``Cash'' Transactions--The Ex-Dividend Rule of the Exchange 
specifies that ``cash'' transactions (in which delivery of the 
security must be made on the date of the transaction) [in the case 
of stocks transferring in the New York City Metropolitan area,] 
shall be ``ex-dividend'' on the business day following the record 
date[, and in the case of stocks transferring only outside of that 
area shall be ``ex-dividend'' on the business day following the 
``equivalent New York record date''].
* * * * *

PART 6. According; Annual and Quarterly Reports (Secs. 603-624)

ACCOUNTING (Sec. 603, Sec. 604)

Sec. 603. CHANGE IN ACCOUNTANTS

    A listed company is required to notify its [Corporate Relations 
Managers] Listing Qualifications Analysis promptly (prior to filing 
its 8-K) if it changes independent accountants; and must state the 
reason for such change.
* * * * *

INTERIM REPORTS (Secs. 622-624)

[Sec. 622. REQUESTS FOR EXTENSION

    A company should immediately notify its Corporate Relations 
Manager whenever it files with the SEC a request for extension of 
time for the filing of its interim statements on SEC Form 12b-25.]
* * * * *

PART 7. Shareholders' Meetings, Approval and Voting of Proxies 
(Secs. 701-726)

SHAREHOLDERS' APPROVAL (Secs. 701-706)

* * * * *

[Sec. 702. CHARTER AND BY-LAW AMENDMENTS

    A listed company is required to file with the Exchange a copy of 
any amendment to its charter or by-laws (or equivalent documents), 
as soon as it becomes effective. Such filing must include:
    (a) in the case of a charter amendment--a certification by the 
Secretary of State (or similar authority) that the filing is a true 
and complete copy of the amendments; and
    (b) in the case of a by-law amendment--a resolution of the board 
of directors (certified by an officer of the company) authorizing 
the by-law amendment.]
* * * * *

SHAREHOLDERS' APPROVAL (Secs. 710-713)

* * * * *

Sec. 713. OTHER TRANSACTIONS

    The Exchange will require shareholder approval (pursuant to a 
proxy solicitation conforming to SEC proxy rules) as a prerequisite 
to approval of applications to list additional shares to be issued 
in connection with:
    (a) a transaction involving:
    (i) the sale, [or] issuance, or potential issuance by the 
company of common stock (or securities convertible into common 
stock) at a price less than the greater of book or market value 
which together with sales by officers, directors or principal 
shareholders of the company equals 20% or more of presently 
outstanding common stocks; or
    (ii) the sale, [or] issuance, or potential issuance by the 
company of common stock (or securities convertible into common 
stock) equal to 20% or more of presently outstanding stock for less 
than the greater of book or market value of the stock; or
    (b) a transaction which would involve the application of the 
Exchange's original listing guidelines as described in Sec. 341.

VOTING BY EXCHANGE MEMBERS, TRANSMISSION OF PROXY MATERIALS (Secs. 720-
726)

* * * * *

Sec. 726. VOTING BY SPECIALISTS (SEE EXCHANGE RULE 186)

    [An] Exchange specialists [is] are prohibited from soliciting, 
directly or indirectly, any proxy on behalf of [himself] themselves 
or any other person in respect of a security in which [he is] they 
are registered as a specialist. [A specialist is] Specialists are 
also prohibited from voting in any proxy contest any such security 
in which [he has] they have a beneficial interest.

[PART 8. Transfer Facilities; Certificate Requirements (Secs. 801-841)

TRANSFER AGENTS, REGISTRARS, TRUSTEES (Secs. 801-811)

Sec. 801. TRANSFER AND REGISTRY FACILITIES

    Listed companies are required to maintain transfer and registry 
facilities (including facilities for conversion or exchange) for 
their listed securities, which are satisfactory to the Exchange. 
Such transfer and registry facilities may be located in New York 
City or outside of New York City provided, in each case, that the 
requirements of Rule 891 of the Board of Governors of the Exchange, 
set forth below, are met.
    Board of Governors Rule 891:
    Requirements in order to qualify as a Transfer Agent for 
securities listed on the American Stock Exchange (where the listed 
Company does not act as its own Transfer Agent) in respect of (i) 
all Transfer Agents located in New York City, and (ii) Transfer 
Agents located out-of-town where the listed Company has no Transfer 
Agent in New York City.
    1. Office facilities (hereinafter referred to as the ``office'') 
satisfactory to the Exchange and the issuer to receive and redeliver 
securities must be located south of Chambers Street in the Borough 
of Manhattan, City of New York.
    2. Routine transfers are to be processed and available for pick-
up at the office under normal conditions within 48 hours, e.g., if 
received before Noon on Monday must be available for pick-up no 
later than immediately after 1:00 P.M. on Wednesday.
    3. The Transfer Agent must assume total responsibility and 
liability for securities from the time of deposit at the office 
until delivery at the window. The Transfer Agent must maintain 
insurance coverage of a least $10,000,000 to protect securities 
while in transit or in process of transfer, and it must

[[Page 6657]]

be in a position to demonstrate that it has a substantial new worth. 
If the Transfer Agent does not have capital, surplus (both capital 
and earned), undivided profits and/or capital reserves aggregating 
at least $3,000,000, it will be required to furnish additional 
evidence of its ability to meet financial obligations and it may be 
required to maintain insurance coverage in excess of $10,000,000. In 
this regard, all relevant factors will be considered such as its 
past record of operations as a transfer agent, the experience of its 
management and supervisory personnel, its security and record-
keeping procedures, the nature and scope of any other activities in 
which it is engaged and the amount of its capital in relation to its 
overall business activities.
    4. Out-of-town agents having a drop in New York must make 
appropriate arrangements to pick up from and deliver to Depositary 
Trust Company normally within the 48-hour period and framework 
mentioned above.
    5. Personnel at the office must have sufficient experience to 
respond promptly to inquiries regarding transfers, including legal 
items.
    6. Securities received before the close business at the office 
on a record date or any other date involving the rights of a 
security holder must be recorded as of the date so as to establish 
the transferee's rights.
    7. Facilities should be available for expediting transfer 
service when needed. No objection will be made if a reasonable 
charge is made for such special service.
    8. The Exchange reserves the right to request a company with 
securities listed on the Exchange to terminate the appointment of 
its transfer agent in the event of failure of such transfer agent to 
conform to all of the foregoing requirements.

Sec. 802. AGREEMENT WITH TRANSFER AGENT

    A company is required to cause its transfer agent or agents to 
enter into an agreement with the Exchange (Listing Form 3 for common 
stock and Listing Form 5 for warrants) whereby the transfer agent 
must notify the Exchange 10 days after the close of each calendar 
quarter of the number of shares outstanding as of the last business 
day of the calendar quarter for each security listed on the 
Exchange. The transfer agent must also notify the Exchange if its 
services are discontinued.

Sec. 803. AGREEMENT WITH REGISTRAR

    A company is also required to cause its registrar or registrars 
to enter into an agreement with the Exchange (Listing Form 4) 
whereby the registrar agrees to notify the Exchange 10 days after 
the close of each calendar quarter of the number of shares 
registered for each security listed on the Exchange. A registrar 
must also notify the Exchange if its services are discontinued.

Sec. 804. ADDITIONAL TRANSFER AND REGISTRY FACILITIES

    Transfer and registry agencies maybe maintained in more than one 
city. However, when shares are transferred in more than one transfer 
office, the combined amounts of stocks registered in all transfer 
offices shall not exceed the amount authorized for listing (See also 
Sec. 829.)

Sec. 805. ACTING IN DUAL CAPACITY

    A qualified bank, trust company, listed company or other 
qualified organization may act in the dual capacities of transfer 
agent and registrar, provided that it countersigns stock 
certificates in both capacities. All entities which act in the dual 
capacity of transfer agent and registrar are required to assure the 
Exchange that such functions are maintained separately and 
distinctly with appropriate internal controls, subject to an annual 
review by the agent's independent auditors which shall be provided 
to the entity's board of directors.
    A listed company acting in the dual capacity of transfer agent 
and registrar for its own securities shall be required to sign an 
appropriate agreement with the Exchange to, among other things:
    1. maintain offices, staffed by qualified personnel, with 
adequate facilities for the safekeeping of securities in its 
possession where transfer and registration may be completed within 
forty-eight hours;
    2. be responsible to indemnify purchasers for any loss arising 
out of over/under issuance of all securities delivered to, or picked 
up by, it as agent, until such securities are delivered pursuant to 
instructions; and
    3. maintain the transfer agent and registrar functions as 
separate and distinct with appropriate internal controls, such 
controls to be reviewed annually by the company's independent 
auditors.

Sec. 806. COMPANY ACTING AS OWN TRANSFER AGENT AND/OR REGISTRAR

    If a security is transferred and/or registered at the company's 
office, the persons who shall be authorized to sign certificates in 
the capacity of registrar and transfer agent shall be appointed by 
specific authority of the board of directors and shall not be an 
officer who is otherwise authorized to sign certificates on the 
company's behalf.

    Note: A listed company which acts as transfer agent and/or 
registrar for the securities of another issuer must comply with 
Exchange rules pertaining to unaffiliated banks, trust companies or 
other organizations (see Amex Rule 891).

Sec. 807. APPOINTMENT OF NEW AGENT

    A company is not permitted to appoint a transfer agent, 
registrar, or other fiscal agent of a security of the company listed 
on the Exchange without prior notice to and approval of the 
Exchange. A registrar must, at the time of its appointment, be 
acceptable to the Exchange as a registrar for securities listed on 
the Exchange.

Sec. 808. SPLIT-UP OF CERTIFICATES AFTER CLOSING TRANSFER BOOKS

    If the transfer books of a company should be closed permanently, 
the company is required to continue to split-up certificates into 
smaller denominations in the same name so long as such stock remains 
listed on the Exchange.

 Sec. 809. AGENT FOR REGISTRATION ON BONDS OR DEBENTURES

    A company applying for the listing (or having listed) registered 
bonds or debentures on the Exchange is required to maintain in New 
York City (See Sec. 801) an office or agency, satisfactory to the 
Exchange, where such bonds or debentures are registerable. In the 
case of bonds or debentures issued in bearer form, such office or 
agency must provide for the payment of principal and interest on 
such indebtedness.

Sec. 810. AGENT FOR PAYMENT OF DIVIDENDS, INTEREST AND PRINCIPAL

    A listed company is permitted to designate an agent, 
satisfactory to the Exchange, located in or outside New York City, 
for the payment of dividends, interest and principal (on bonds or 
debentures), and other payments with respect to a listed security. 
If, however, checks for such payments are drawn on a bank located 
outside New York City, additional arrangements must be made for 
payment against such checks at a bank, trust company or agency 
located in New York City; and the details of those arrangements 
disclosed to the payee.

Sec. 811. TRUSTEES FOR BOND ISSUES

    (a) Trustee to be a bank or trust company--The trustee of a bond 
issue must be a trust company or banking institution having 
substantial capital and surplus and the experience and facilities 
for handling corporate trust business. In cases where, for any 
reason, an individual has been appointed as trustee, a qualified 
trust company or banking institution must be appointed co-trustee.
    (b) Separate trustee for each issue--If the company, either at 
the time of listing or subsequently, should have bonds or other 
evidences of indebtedness outstanding under more than one mortgage, 
indenture or deed or trust, each issue shall be represented by a 
different trustee; provided, however, that separate trustee shall 
not be required in the case of several issues of bonds issued under 
one or more indentures that have been qualified under the Trust 
Indenture Act of 1939, as amended.
    (c) Persons not acceptable as trustees--The Exchange does not 
regard as satisfactory to act as a trustee for a listed issue any: 
(i) officer or director of the issuing company; (ii) trust company, 
banking institution, or other organization in which an officer of 
the issuing company is an executive officer; or (iii) organization 
controlled by, under common control with, or which itself controls, 
the issuing company.
    (d) Changes in trustees--No change is to be made in the trustee 
of a listed issue without prior notice to and approval of the 
Exchange.

FORM OF SECURITIES-ENGRAVING (Sec. Sec. 820-830)

Sec. 820. REVIEW BY THE EXCHANGE

    In addition to complying with the requirements set forth below, 
companies should submit the following to the Exchange for review and 
approval:
    (a) proofs of a security prior to final printing; and

[[Page 6658]]

    (b) specimens of the security in final form, printed on the bond 
paper to be used for the definitive security, accompanied by the 
banknote company agreement described in Sec. 823. No change in the 
form of a certificate should be made without the approval of the 
Exchange.

Sec. 821. ENGRAVED BORDER

    The face of listed securities (stocks and bonds) must be printed 
from at least one engraved steel border plate produced by a banknote 
company whose work is acceptable to the Exchange. The company may, 
at its option, use a second steel engraved face plate.

Sec. 822. BORDER PLATE ORIGINAL

    The engraved border plate (and engraved face plate, if used) 
must be original to the banknote company which prepared the 
security, and the name of such banknote company must appear on the 
face of all securities and also on the face of coupons and filing 
panel of each bond.
    The border plate shall remain in the permanent possession of the 
banknote company which produced it. The plate may be used by such 
banknote company in the production of ``controlled stock'' 
securities of more than one company, provided that such securities 
are prepared in their entirety on the premises of such banknote 
company, which shall furnish the Exchange with the certificate and 
agreement described in Sec. 823.

Sec. 823. AGREEMENT OF BANKNOTE COMPANY

    The final specimen submitted to the Exchange must be accompanied 
by:
    (a) a certificate of the banknote company that:
    (i) the security has been prepared in accordance with the 
printing and engraving requirements of the American Stock Exchange; 
and
    (ii) all work done in connection with the preparation and 
manufacture of the dies, rolls, plates and certificates has been and 
will be done entirely on the premises of the banknote company, 
except as may be specifically noted (if there are any exceptions, 
full details must be given);
    (b) an agreement by the banknote company (by its terms binding 
upon the banknote company, its successors and assigns) that all 
dies, rolls, plates and other engravings used in connection with the 
manufacture of certificates of the particular issue will, at all 
times, be and remain in the possession of the banknote company and, 
when not actually being used in connection with the manufacture and 
preparation of certificates, will be kept in a vault on the premises 
of the banknote company, and all completed certificates of the issue 
and all certificates in process will, prior to delivery to or upon 
the order of the issuing company (except when in actual process of 
manufacture), be kept in such vault. (See Appendix for suggested 
format.)

Sec. 824. COLOR

    The printing of securities must be in distinctive colors to make 
classes and denominations readily distinguishable.

Sec. 825. PAPER-SIZE

    All paper used for securities must be of an excellent grade of 
bond paper, of adequate weight and strong enough to withstand the 
strains and stresses of frequent handling. Stock certificates shall 
be of the standard size of 8  x  12 inches.

Sec. 826. DENOMINATIONS

    The Exchange has no requirements as to denominations of stock 
certificates and permits either the sole use of single (unlimited) 
denomination certificates, or certificates for 100 shares, less than 
100 shares and unlimited denominations.
    The denomination of 100 shares, less than 100 shares and more 
than 100 share certificates should be appropriately indicated on the 
certificate by engraving or surface printing at the option of the 
company. Companies which do not have a separate certificate for more 
than 100 shares may alter the certificate for 100 shares or for less 
than 100 shares by over-printing.
    Certificates for other than 100 shares should indicate the exact 
number of shares by the use of a macerating machine that breaks the 
paper or a matrix. A company may also use a punchout panel in 
addition to one of the methods noted above.

Sec. 827. PAR VALUE

    The par value of common stock may be eliminated from common 
stock certificates, except where required by law. Par value may also 
be eliminated from preferred stock certificates, except where the 
dividend rate is expressed as a percentage of par value. Where a 
company elects to eliminate par value from its stock certificates, 
an opinion of counsel as to legality under applicable state law and 
the company's charter should be filed with the Exchange. Where par 
value is shown on certificates, either as the result of legal 
requirements or a company's preference, it may be surface printed 
rather than engraved.

Sec. 828. PREFERENCES

    If the stock certificates of a company do not recite the 
preference of all classes of its stock, the company is required to 
furnish to its shareholders, upon request and without charge, a 
printed copy of preferences of all classes of its stock. A reference 
to the availability of such copy should appear on such certificates.

Sec. 829. CERTIFICATES TRANSFERRED IN MORE THAN ONE TRANSFER OFFICE

    When shares are transferred in more than one transfer office, 
certificates should be interchangeably transferable and identical in 
color and form, except as to names of transfer agent and registrar, 
and the certificates shall bear a legend naming all cities in which 
they may be transferred.

Sec. 830. SUPPLY OF CERTIFICATES

    A company is required to have on hand at all times a sufficient 
supply of certificates to meet the demands for transfer.

LOST CERTIFICATES, CUSIP NUMBERS (Secs. 840, 841)

Sec. 840. REPLACEMENT OF LOST CERTIFICATES

    A company is required to issue new certificates for securities 
listed on the Exchange replacing lost ones immediately upon 
notification of loss and receipt of proper indemnity.
    In the event of the issuance of any duplicate bond to replace a 
bond which has been alleged to be lost, stolen or destroyed and the 
subsequent appearance of the original bond in the hands of an 
innocent bondholder, either the original or the duplicate bond will 
be taken up and canceled and the company must deliver to such holder 
another bond theretofore issued and outstanding.

Sec. 841. CUSIP IDENTIFICATION NUMBER

    Certificates for listed securities are required to have 
imprinted thereon the appropriate CUSIP identification number which 
is provided by Standard & Poor's Corp.

PART 9. Treasury Shares; Additional Matters (Secs. 901-994)

TREASURY SHARES, REDEMPTIONS AND REPURCHASES (Secs. 901-903)

* * * * *

Sec. 901. ACQUISITION OR DISPOSITION OF TREASURY SHARES

    A company is required to report to the Exchange, within ten days 
after the close of each fiscal quarter, any reacquisition or 
disposition of its previously issued shares listed on the Exchange 
made during the quarter. Such reports are to include treasury share 
transactions for the account of the company, whether direct or 
indirect, and are to show separate totals for acquisitions and 
dispositions and the number of treasury shares held by it at the end 
of the quarter.
    A sample form of report is shown below:

American Stock Exchange

86 Trinity Place
New York, N.Y. 10006-1881
    Dear Sirs: Pursuant to section 901 of the Company Guide, this is 
to report that the company effected transactions in shares of its 
previously issued common stock, $1 par value, during the quarter 
ended (date), as follows:

Treasury shares held as of (date): 60,000
Shares reacquired during quarter ended (date):
    Total: 60,000
Shares disposed of during quarter ended (date):
    (Date)--Exercise of option: 2,000
    (Date)--Exercise of option: 8,000
Total shares disposed of: 10,000
Balance as of (date): 50,000

Very truly yours,
XYZ COMPANY

Sec. 902. REDEMPTION, CANCELLATION, RETIREMENT

    A company is not permitted to select any of its listed 
securities for redemption

[[Page 6659]]

otherwise than pro rata or by lot, and is required to notify the 
Exchange at least 15 days in advance of any redemption and to 
furnish it promptly with any information requested in connection 
with the redemption.
    Bonds, debentures or preferred stocks issued, or to be issued, 
under an indenture or charter provision not conforming to this 
requirement are not eligible for listing on the Exchange.
    A company is also required to notify the Exchange promptly of 
any corporate action which will result in the redemption, 
cancellation or retirement, in whole or in part, of any of its 
securities listed on the Exchange, and to notify the Exchange as 
soon as the company has notice of any other action which will result 
in any such redemption, cancellation or retirement.
    Notices under this section should be directed to the attention 
of the company's Corporate Relations Manager.

Sec. 903. REPURCHASES OF LISTED COMPANY SECURITIES

    (a) Private Transactions--Purchase Above Market--A company is 
required to notify the Exchange promptly of all facts relating to 
the purchase, direct or indirect, of any of its securities listed on 
the Exchange at a price in excess of the market price of such 
security prevailing on the Exchange at the time of purchase. Such 
reports should be made by telephone or telex and confirmed by 
letter.
    Since such transactions may involve state and Federal legal 
considerations, it is recommended that company counsel and officials 
of the Exchange be consulted prior to effecting a proposed 
repurchase of listed securities above the market.
    It is the policy of the Exchange to make such reports available 
to the public in its library. In addition, the Exchange may require 
the company to issue a public announcement and a notice to its 
shareholders regarding such repurchase.
    (b) Open Market Purchases.--Rule 10b-18 under the Exchange Act 
provides a ``safe harbor'' for issuer repurchases of up to 25% of 
the average daily volume for the preceding four weeks of exchange-
traded securities when certain timing, price and broker-dealer 
conditions are met. Part (c) of such Rule specifically provides, 
however, that compliance with the conditions is not the exclusive 
method available to listed companies to effect repurchases in the 
marketplace.
    Companies planning to repurchase their securities in the 
marketplace, should consult with their Corporate Relations Manager 
(whether or not they plan to rely on the safe harbor of the Rule) to 
ascertain the appropriate disclosure necessary for the maintenance 
of a fair and orderly market.

    Note: Companies should be aware of the prohibitions on purchases 
contained in Rule 10b-6 under the Act when they are involved in a 
non-technical distribution of their securities.

    (c) Purchases on behalf of certain employee plans--Rule 10b-6 
under the Exchange Act exempts purchases by independent agents, as 
defined, on behalf of certain employee and shareholder plans.
    (d) Tender Offer--A listed company contemplating the making of a 
tender offer for any or all of its securities should structure the 
offer so as to comply with all applicable Federal and state 
securities laws.
    Inasmuch as a tender offer may significantly affect the market 
for or the continued listing eligibility of the security, the 
company should consult with its Corporate Relations Manager prior to 
the announcement and commencement of such offer.
    (e) Odd-lot Tender Offers--A company intending to make a tender 
offer to its odd-lot (1 to 99 shares) holders may find the following 
guidelines helpful:
    (i) the use of a retroactive record date (i.e., a date 
immediately preceding the date of announcement) will enable the 
company to restrict the offer to existing odd-lot holders.
    (ii) the tender offer should remain open for a sufficient period 
of time to provide all odd-lot holders with ample opportunity to 
participate; and
    (iii) since many odd-lot holdings are in ``street'' or nominee 
names, the company should provide a mechanism which allows its 
beneficial holders to participate equally with record holders. In 
this connection, a company may wish to consider the following:
    (A) a ``broker guarantee'' provision which permits the tender of 
odd-lot holdings that are not readily available for physical 
delivery within the tender period;
    (B) a requirement that holders of record tendering on behalf of 
a beneficial owner confirm to the company that the securities 
tendered represent the beneficial owner's entire holdings of that 
security.]

RELATIONSHIP WITH SPECIALIST (Sec. 910)

Sec. 910. PROCEDURES, RULES AND REGULATIONS

    From time to time, company officials inquire about Exchange 
rules or regulations affecting their relationship to the registered 
specialist in their securities.
    (a) Specialist's Function--[The specialist is a] Specialists are 
members of the Exchange who performs two basic functions regarding 
the issues in which [he] they specialize[s]. As [a] brokers, [he 
they hold[s] and execute[s] orders entrusted to [him] them by other 
brokers on behalf of their customers. As [a] dealers, [he is] they 
are obliged, insofar as reasonably practicable, to purchase and sell 
securities for [his] their own account in order to help maintain a 
fair and orderly market. [His] Their aim is to provide a continuous 
auction market throughout the trading day, with minimum price 
changes between transactions. [The specialist does] Specialists do 
not by [his] their own activities determine the trend of stock 
prices. Rather, the price at any given moment is determined 
fundamentally by the balance of public buy and sell orders.
    (b) Liaison--The Exchange recognizes that periodic communication 
between company officials and their specialists, if appropriately 
conducted, can be beneficial to both parties. Such communication may 
provide company officials with a better understanding of the auction 
market, the specialist system and their own specialist's role in 
relation to the company's securities. From the specialist's 
viewpoint, an awareness and understanding of the company and its 
affairs may aid [him] specialists in discharging [his] their 
responsibility for maintaining a fair and orderly market in the 
company's securities.
    (c) Scope of Permissible Disclosure--In view of the specialist's 
central and sensitive role in the auction market, it is essential 
that Federal securities laws, Exchange rules and a responsible code 
of conduct be observed in all communications between specialists and 
company officials. The following summary may serve as a guide as to 
the scope of permissible disclosure in such communications.
    A company may make available to the specialist whatever 
information it has provided to its stockholders, security analysts 
or the general public, such as specific data and information 
concerning general trends relating to the company's business, as 
well as industry and general economic developments that may 
influence the company's welfare. It is improper, however, to furnish 
to the specialist any material information not previously released 
to the public regarding such matters as earnings, forecasts, 
anticipated dividend action, a proposed stock split, merger 
negotiations or any other undisclosed matter which is likely to have 
a significant effect on the price of the company's securities or 
influence investment decisions.
    While it is not contemplated that a company will be in 
continuous contact with its specialist, the specialist may from time 
to time inform company officials of unusual market problems and 
respond to broad questions about the market in the company's stock. 
The restrictions imposed on [a] specialists concerning the 
information [he] they may disclose are set forth in paragraph (d)(i) 
below.
    Within this framework, company officials and specialists should 
feel free to call upon each other so that a mutually beneficial 
understanding of the problems encountered by each is fostered.
    (d) Exchange Rules Governing Specialist's Activities--In 
addition to certain provisions of the Securities Exchange Act of 
1934, a number of Exchange regulations place clearly defined limits 
on a specialist's activities. An awareness of both the intent and 
spirit of Exchange rules, and the responsibilities the Exchange 
places on the specialist, will help ensure that contacts between 
company officials and the specialist are conducted within the 
framework provided for above.
    With respect to any security in which a specialist is 
registered, Exchange rules prohibit [the] specialists (and, with 
respect to paragraphs iii through ix, the member firm or member 
corporation of which the specialist is a member) from:
    (i) disclosing, at any time, to any person other than a Floor 
Official or authorized Exchange Official, any information in regard 
to orders entrusted to the specialist or the name of a buyer or 
seller except as may be necessary solely for the purpose of 
processing a transaction; however, that when requested by a member, 
member organization, or representative of the issuer of the security 
involved, [the] specialists shall, to the best of [his] their 
ability, disclose

[[Page 6660]]

to such parties the names of buying and selling member organizations 
in completed Exchange transactions unless specifically directed to 
the contrary by the member organizations involved;
    (ii) effecting transactions for [his] their own account, unless 
such dealings are reasonably necessary to permit [him] them to 
maintain a fair and orderly market;
    (iii) acquiring, holding or granting an option in any such 
security;
    (iv) being an officer or director of the issuer of any such 
security;
    (v) nominating, directly or indirectly, any person to be on the 
board of directors of the issuer of any such security;
    (vi) effecting, directly or indirectly, any business transaction 
with the issuer of any such security or any officer, director or 10% 
stockholder of any such issuer;
    (vii) accepting an order for the purchase or sale of any stock 
directly from the company issuing such stock; from any officer, 
director or 10% stockholder of that company; from any pension or 
profit-sharing fund; or from any bank, trust company, insurance 
company, investment company, or similar institution;
    (viii) soliciting any proxy, directly or indirectly, on behalf 
of [himself] the specialist or any other persons in respect of any 
such security; and
    (ix) voting, directly or indirectly, in any proxy contest 
involving any such security in which [he] the specialist has a 
beneficial interest.
    With respect to any security in which a specialist is 
registered, Exchange rules require the specialist to report to the 
Exchange:
    (i) unusual activity or price change:
    (ii) information which may materially affect the business or 
financial structure of the issuer of, or the market for, such 
security;
    (iii) the existence of options or selling agreements;
    (iv) any unusual transaction in which the specialist 
participates as a broker or dealer; and
    (v) each purchase and sale for the specialists' own account.
    [(e) Corporate Relations Manager--A company's Corporate 
Relations Manager may serve as a communications link between a 
company and the specialist and can be helpful whenever questions 
about activity in a company's stock or other matters arise (see 
Secs. 207 and 405).] Director--The company will be assigned a day-
to-day contact (Director) who will:
    (i) respond to questions concerning performance of the company 
stock;
    (ii) assist the company in developing customized investor 
relations programs;
    (iii) keep company officials abreast of industry--related issues 
and rule changes; and
    (iv) serve as liaison between company officials and specialist 
and generally provide guidance to the company concerning its 
Exchange listing.
* * * * *

CHANGE OF NAME (Sec. 930, Sec. 931)

Sec. 930. CHANGE OF NAME

    A company proposing to change its name should:
* * * * *
    (c) As soon as the change in name has been approved by 
shareholders, notify the Exchange [(by telephone or telex)] of the 
time when the amendment to the charter will be filed and the change 
in name will become effective. Confirm this advice by letter.
* * * * *
    (e) Notify the Exchange [(by telephone or telex)] as soon as the 
amendment has actually been filed and confirm this advice by letter.
    [(f) As soon as available, furnish the Exchange with a copy of 
the amendment to the charter covering the change in name certified 
as to its filing by the office of the Secretary of State. A specimen 
copy of each denomination of the stock certificates on which the 
change in name is reflected (in the form in which such certificates 
will be issued against transfers after the effective date of the 
change in name) should also be furnished.]
* * * * *

CHANGE IN PAR VALUE (Sec. 940)

Sec. 940. CHANGE IN PAR VALUE

    A company that changes the par value of a stock issue listed on 
the Exchange, without an increase or decrease in the number of 
shares listed, is required to follow the procedures and file the 
papers specified below:
* * * * *
    [(d) Immediately after the filing of the charter amendment, the 
company must furnish the Exchange with the following documents:
    (i) A copy of the Certificate of Amendment of the charter 
effecting the change in par value, certified by the Secretary of 
State or corresponding authority.
    (ii) Specimens of all denominations of the new or changed form 
of stock certificates reflecting the change in par value. It is 
advisable to furnish these prior to the filing of the charter 
amendment.
    (iii) Opinion of counsel of satisfactory standing: (A) as to the 
legality of authorization of the change and the validity of the new 
par value shares resulting from such change; (B) that the new par 
value shares are validly issued, fully-paid and non-assessable; and 
(C) that no personal liability attaches to ownership thereof. If 
such counsel or any partner of such, counsel (or, if a firm, any 
member thereof) is an officer, director or shareholder of the 
company, this fact should be stated in the opinion.]
* * * * *

APPLICATION AND INTERPRETATION OF REQUIREMENTS (Secs. 90-994)

* * * * *

Sec. 994. NEW POLICIES

    Copies of new or revised rules, policies, or forms, adopted 
subsequent to the date of this Guide, will be distributed, following 
their adoption. Questions concerning new materials, as well as 
materials contained in this Guide, should be directed to a company's 
assigned [Corporate Relations manager] Listing Qualifications 
Analyst.
* * * * *

PART 11. Guide To Filing Requirements (Sec. 1101, Sec. 1102)

Sec. 1101. GENERAL

    A company having a security listed on the Exchange and 
registered under Section 12(b) of the Securities Exchange Act of 
1934 is required to file information, documents and reports with the 
SEC (or other appropriate regulatory agency) on a timely basis and 
file original or conformed copies with the Exchange. With the 
exception of annual reports to shareholders, which must continue to 
be filed with the Exchange in hard copy, a company which submits 
such material electronically to the SEC will be deemed to have 
satisfied this requirement.
    The Exchange also requires timely notice and written 
confirmation of certain additional information, including proposed 
amendments to and certified copies of the Certificate of 
Incorporation, By-laws or other similar organization documents and 
all material sent to shareholders or released to the press. A 
summary guide to the Exchange's filing requirements following:
* * * * *

[Treasury Stock Changes......  Within ten days            1         901]
                                after the end
                                of a quarter
                                in which a
                                change
                                occurred.
 
*                  *                  *                  *
                  *                *                  *
[Charter or By-Law Amendments  As soon as                 1         702]
                                effective.
 
*                  *                  *                  *
                  *                *                  *
Form N-SAR (for unit           Concurrently              *1         1101
 investment trusts and open-    with SEC
 end management investment      filing.
 companies).
Form N-30D (for unit           Concurrently               3         1101
 investment trusts and open-    with SEC
 end management investment      filing.
 companies).
Form 24F-2; Form S-6; Form N-  Concurrently              *1         1101
 8B-2 (for unit investment      with SEC
 trusts).                       filing.
497 (for open-end management   Concurrently               3         1101
 investment companies).         with SEC
                                filing.

[[Page 6661]]

 
Form 24F-2 NT (for open-end    Concurrently              *1         1101
 management investment          with SEC
 companies).                    filing.
 
*                  *                  *                  *
                  *                *                  *
 

Supplement

    Emerging Company Marketplace
    The Exchange established the Emerging Company Marketplace to 
accommodate the listing of companies, domestic or foreign, which are 
too small to qualify for regular listing. In May 1995 the Exchange 
determined to discontinue the list of new companies on the ECM. 
Companies which were listed on the ECM at that time were permitted 
to continue listed there, subject to all the rules applicable to ECM 
issues.

[NUMERICAL CRITERIA

A. Common Stock

----------------------------------------------------------------------------------------------------------------
                                                    Regular                               Alternate
----------------------------------------------------------------------------------------------------------------
Companies Traded in NASDAQ:
Total Assets......................  $2 million.............................  $2 million.
Stockholders' Equity..............  $1 million.............................  $2 million.
Aggregate Market Value............  $2.5 million...........................  $2.5 million.
Public Float *....................  250,000 shares.........................  250,000 shares.
Public Shareholders *.............  300....................................  300.
Minimum Price.....................  $1.....................................  Below $1.
Companies Not Traded in NASDAQ:
Total Assets......................  $4 million.............................  $3 million.
Stockholders' Equity..............  $2 million.............................  $2 million.
Aggregate Market Value............  $2.5 million...........................  Above $10 million.
Public Float *....................  250,000 shares.........................  400,000 shares.
Public Shareholders *.............  300....................................  3,300.
Minimum Price.....................  $3.....................................  $2.
----------------------------------------------------------------------------------------------------------------
* These terms include both shareholders of record and beneficial holders, but are exclusive of the holdings of
  officers, directors, controlling shareholders, and other concentrated (i.e. 5 or grater), affiliated or family
  holdings.

B. Preferred Stock

    In addition to satisfying the assets, equity and price criteria 
set forth in A above, the company must (i) appear to be in a 
financial position sufficient to satisfactorily service the dividend 
requirements for the issue, and (ii) have at least 100,000 preferred 
shares publicly held (as defined in A above) with an aggregate 
market value of at least 2,000,000.
    The Exchange will not list convertible preferred issues 
containing a provision which gives the company the right, as its 
discretion, to reduce the conversion price for periods of time, or 
from time to time, unless the company establishes a minimum period 
of ten business days within which such price reduction will be in 
effect.* The Exchange also will not consider listing a convertible 
preferred issue unless the underlying common stock meets all the 
criteria set forth in Part A above.
    The Exchange strongly recommends that each preferred issue 
listed on the ECM be structured so as to comply with the voting 
requirements of Section 124 of the Company Guide.

C. Warrants

    The listing of warrant issues is subject to all of the numerical 
criteria set forth in Part A, except for those with respect to price 
and market value. However, the Exchange will not consider listing 
warrants exercisable into common stock unless such common stock 
meets all the criteria set forth in Part A above.*
    The Exchange will not list warrant issues containing provisions 
which give the company the right, at its discretion, to reduce the 
exercise price of the warrants for periods of time, or from time to 
time, during the life of the warrants, unless the company 
establishes a minimum period of ten business days within which such 
price reduction will be in effect. This policy will not preclude the 
listing of warrant issues for which regularly scheduled and 
specified changes in the exercise price have been previously 
established.
    Whenever a company having warrants listed on the Exchange 
effects a split of 3-for-2 or greater in the underlying shares, the 
Exchange requires that a corresponding split be made in the 
warrants.

D. Debt Issues

    Companies applying for listing of bonds or debenture issues are 
expected to meet the following criteria:
    (a) The company appears to be in a financial position sufficient 
to satisfactorily service the debt issue to be listed and meets the 
assets and stockholders' equity criteria set forth in A above.
    (b) Listing will be limited to debt securities of at least $5 
million in principal amount/aggregate market value.
    (c) The Exchange will not list convertible debt issues 
containing a provision which gives the company the right, at its 
discretion, to reduce the conversion price for periods of time, or 
from time to time, unless the company establishes a minimum period 
of ten business days within which such price reduction will be in 
effect.* The Exchange also will not consider listing a convertible 
debt issue unless the underlying common stock meets all the criteria 
set forth in Part A above.

E. Units

    The Exchange may list units comprised of one or more of the 
securities enumerated above provided that each of the component 
parts of the unit would otherwise separately satisfy the applicable 
listing requirements.

F. Redemption, Cancellation, Retirement

    A company is not permitted to select any of its listed 
securities for redemption otherwise than pro rata or by lot, and is 
required to notify the Exchange at least 15 days in advance of any 
redemption and to furnish it promptly with any information requested 
in connection with the redemption.

G. Listing Procedures

    A company which satisfies the original listing criteria may 
apply for a confidential preliminary listing eligibility opinion 
which will be furnished without charge as described in Sec. 202.
    Footnotes: *The Exchange will not consider listing warrants, 
convertible preferred or convertible debt issues of a company unless 
current last sale information is available with respect to the 
underlying security.]
* * * * *

[LISTING FEES

    There is a one-time original listing fee of $5,000 which is 
inclusive of all issues which become listed on the ECM. In addition, 
an annual fee shall be payable, as provided by Sec. 141.]
* * * * *

CONTINUED LISTING CRITERIA

    Continued listing on the Exchange is dependent upon compliance 
with the following numerical criteria:

A. Common Stock

    no change

[B. Preferred Stock

    In addition to satisfying the assets, equity, market value and 
price criteria set forth in A above, the company will be subject to

[[Page 6662]]

delisting if it does not have at least 50,000 preferred shares 
publicly held (as defined in A above).

C. Warrants

    Warrant issues must satisfy all the numerical criteria set forth 
in Part A, except those with respect to price and market value. In 
addition if the warrants are exercisable into common stock, the 
warrants are subject to delisting if the common stock is not in 
compliance with the numerical criteria set forth in A above.

D. Debt Issues

    Continued listing on the Exchange for bond and debenture issues 
is dependent upon compliance with the criteria specified in 
Secs. 1003 (b)(iii) and (e) of the Company Guide.

E. Units

    Continued listing on the Exchange of units comprised of one or 
more of the securities enumerated above is dependent upon compliance 
by each component part of the unit with the applicable criteria 
enumerated above.

F. Additional Requirements

    Companies with a deficiency in market value or price for 10 
consecutive trading days shall have 90 days thereafter in which to 
comply with the continued listing requirements. Companies with a 
deficiency in any other criteria shall be immediately subject to 
delisting in accordance with the procedures set forth in Sec. 1010 
of the Company Guide.
    In addition, the Exchange shall delist any issue which ``ceases 
to be an Eligible Security'' pursuant to Section VI(c)(iii) of the 
Consolidated Tape Plan, and the issues of any company which fails to 
take appropriate steps to ensure that no ECM-listed securities are 
sold in its behalf in reliance upon the exemption from state 
securities registration which is otherwise available to companies 
listed on the Exchange.

Appendix: Listing Forms

* * * * *

Listing Form 1

Listing Agreement

--(the ``Company''), in consideration of the listing of its 
securities, hereby agrees with the American Stock Exchange, Inc. 
(the ``Exchange''), that it will:
    (1) Comply with all Exchange rules, policies and procedures 
which apply to listed companies as they are now in effect and as 
they may be amended from time to time, regardless of whether the 
company's organization documents would allow for a different result.
    (2) Notify the Exchange, at least 20 days in advance, of any 
change in the form or nature of any listed security or in the 
rights, benefits and privileges of the holders of such security.
    (3) File with the Exchange (i) proposed amendments to and 
certified copies of the Certificate of Incorporation; By-Laws or 
other similar organization documents; (ii) all SEC filings; and 
(iii) all material sent to shareholders or released to the press.]

Listing Form 2

Distribution and Trading Information

    DELETED

Listing Form 3

Agreement With Transfer Agent

    DELETED

Listing Form 4

Agreement With Registrar

    DELETED

Listing Form 5

Agreement With Warrant Agent

    DELETED

Sample Trustee's Certificate

    DELETED

Sample Agreement of Banknote Company

    DELETED
* * * * *

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

    Due to the merger between the National Association of Securities 
Dealers (``NASD'') and the Amex, the qualifications functions for 
the Nasdaq Stock Market (``Nasdaq'') and the Amex have been 
centralized in the Nasdaq-Amex Listing Qualifications Department 
(``Listing Qualifications''). As a result of this centralization, a 
number of Exchange rules have been reviewed with the goal of 
modernizing the Exchange's initial and continued listing process, 
creating consistent rules and processes across all of the NASD's 
marketplaces, and reflecting the current business practices and 
procedures used by Listing Qualifications. This filing addresses 
those goals and makes other non-substantive changes to reflect 
changed job titles \6\ and responsibilities following the merger, 
and clarifies the application of certain Exchange rules.
---------------------------------------------------------------------------

    \6\ Changes to Part 4 of the Listing Standards reflect the 
elimination of the Corporate Relations Manager job function and the 
function and the division of the responsibilities of the former 
Corporate Relations Manager among the Listing Qualifications, Stock 
Watch, and Issuer Service Departments.
---------------------------------------------------------------------------

Application Process

    Currently, Exchange rules encourage issuers to obtain an 
informal opinion from Amex staff, known as the Preliminary Listing 
Eligibility Opinion (``PLEO''), as to whether the issuer is eligible 
to list before formally applying to the Exchange. Because of the 
time involved for the issuer to prepare for this extra review and 
for staff to conduct this extra review, the PLEO process causes a 
delay in the time it takes for a final determination to be made on 
an issuer's application for listing on the Exchange. This process is 
also inconsistent with the Nasdaq process in which an application is 
filed at the outset of the process. As a result, when an issuer 
initially pursues listing on both markets, the issuer faces a delay 
in its ability to make a decision as to where to list. In order to 
streamline the application process, the Exchange proposes to 
eliminate the PLEO process. Accordingly, the Exchange proposes to 
delete Sections 202 and 203 of the Listing Standards, Policies and 
Requirements and modify Sections 101, 130, 201 and 211 to eliminate 
references to the PLEO process. Under the proposed revision, issuers 
will only file their completed listing application with the 
Exchange's staff.
    In addition, Exchange rules currently require a number of 
documents to be submitted with an original listing application. The 
Exchange proposes to eliminate certain requirements, including the 
Exchange's Listing Form 2 (Certificate of Distribution), Charter, 
By-Laws, Specimen Certificates, Trustee Certificates, Form for 
Indenture, Board Resolutions and certain contracts. Many of these 
documents are electrically available through an Issuer's public 
filings, or they are generally available to Listing Qualifications 
through other means (or upon request by Exchange staff from the 
issuer). Therefore, the Exchange proposes to remove these general 
requirements and instead request specific documents as necessary.\7\ 
Specifically, the Exchange proposes to modify Sections 213, 216, 
218, 305, 306, and 702 to reflect these changes.
---------------------------------------------------------------------------

    \7\ In the standard comment letter that the Exchange sends 
issuers after Exchange staff has reviewed the issuer's listing 
application, the Exchange will ask issuers specific questions 
concerning quorum requirements, notice of record dates to 
shareholders and closing of transfer books. Telephone call between 
Michael S. Emen, Vice President, Listing Qualifications, Amex, 
Rebekah Liu, Special Counsel, Division, Commission, and Sonia 
Patton, Attorney, Division, Commission, on January 27, 2000.
---------------------------------------------------------------------------

    Similarly, the Exchange proposes that issuers no longer be 
required to obtain an opinion of counsel which, among other things, 
relates to the legality of the organization and existence of the 
issuer and the validity of the securities to be listed. These rules 
were originally enacted to prevent unauthorized securities from 
entering into the market and to protect the Exchange from legal 
liability, which might arise from the listing and trading of such 
securities. Today, however, such concerns are unwarranted. In 
particular, an issuer's independent auditor reviews the issuance of 
securities as part of its annual audit and, generally, legal comfort 
is provided to market participants with respect to most securities 
issuances, including public offerings. Furthermore, the Exchange is 
largely protected from legal claims against it by its status as a 
self-regulatory organization and no

[[Page 6663]]

recent case has been brought alleging invalid issuance of an 
Exchange security. Accordingly, the Exchange proposes to delete 
requirements related to opinions of counsel in Sections 213, 216, 
218, and 306 of the Listing Standards.\8\
---------------------------------------------------------------------------

    \8\ Through its standard comment letter, the Exchange will 
require issuers to (i) furnish the Exchange with copies of opinion 
of counsel filed in connection with recent public offerings or 
private placements or (ii) if no opinions of counsel exist, 
represent to the Exchange that they are duly and validly organized 
under the laws of their state of incorporation. Telephone call 
between Michael S. Emen, Vice President, Listing Qualifications, 
Amex, Rebekah Liu, Special Counsel, Division, Commission, and Sonia 
Patton, Attorney, Division, Commission, on January 27, 2000.
---------------------------------------------------------------------------

    The Exchange currently requires an application to be submitted 
by an issuer whenever a shareholder rights plan is established and 
the underlying rights are registered with the Commission. These 
rights, commonly known as ``poison pills,'' technically constitute a 
separate security but trade in tandem with an as part of the 
issuer's common stock. Upon the occurence of a ``triggering'' such 
as the announcement of a hostile takeover or the acquisition of a 
specified percentage of the company's outstanding common stock, the 
rights would detached from the common stock and become freely 
tradable as separate securities. At that point, under Exchange 
rules, the issuer is required to file a listing application with 
respect to those new securities. Given the listing application 
requirement upon the occurrence of a triggering event and the fact 
that until that time the securities are not traded as separate 
securities, the Exchange believes the requirements of Section 343 
are not necessary.

Criteria for Original Listing

    Sections 104 and 105 of the Listing Standards allow the listing 
of debt and warrants on the Amex, but only if the issuer is listed 
on the Amex or the New York Stock Exchange (``NYSE''. This rule is 
no longer necessary or appropriate, given the level of the listing 
standards on Nasdaq in comparison to those of the Amex and the NYSE. 
The Exchange therefore proposes to expand the issues which may be 
listed on Amex to include debt and warrants of issuers listed on 
Nasdaq.
    Sections 112, 115, and 116 of the Listing Requirements impose 
more stringent standards on specific types of issuers: exploration 
and development companies, member corporations, and companies 
engaged in gaming operations. These rules arose when such companies 
generally remained private and the listing of companies in such 
sectors was fairly unusual. The Exchange proposes to eliminate these 
sector-specific sections since the listing of securities of issuers 
in these sectors is now fairly common across all markets and issuers 
in these sectors now operate in highly regulated environments. 
Specifically, with respect to exploration and development companies, 
the Exchange notes that detailed disclosures about the issuer's 
stage of development and prospects are provided to potential 
investors in required, publicly filed reports. Accordingly, the 
Exchange does not believe it is appropriate to discriminate against 
such exploration stage companies seeking to raise capital on the 
Exchange. With respect to member corporations, the Exchange notes 
that these issuers are regulated by both the Commission and the 
membership organization to which the issuer belongs. Finally, with 
respect to companies engaged in gaming operations, the Exchange 
notes that these issuers operate in a highly regulated environment 
and are subject to substantial state and/or federal regulation. 
Furthermore, the Exchange notes that under its discretionary 
authority over all issuers, pursuant to Section 101, it has 
authority to deny listing to issuers based on sector-specific issues 
in appropriate situations. Accordingly, the Exchange does not 
believe that the specific rules relating to issuers in these sectors 
are necessary or appropriate.
    The Exchange also proposes to clarify that the alternate listing 
guidelines contained in Section 101 of the Listing Standards are not 
limited to issuers in certain sectors. The alternate guidelines were 
first adopted in 1977 and then modified in 1986 to allow a broader 
range of companies to qualify. The guidelines referenced as 
examples, companies that were unable to satisfy the basic criteria 
due to significant research and development or other similar 
business development costs. The Exchange proposes changes to Section 
101 to clarify that the numerical aspects of the alternate 
guidelines apply to all issuers, regardless of industry. This change 
would be consistent with the approach used on Nasdaq, SmallCap 
Market, and the NYSE, where alternative listing requirements are 
available to all issuers that meet the quantitative requirements.

Fees

    Section 144 of the Listing Standards currently imposes a $250 
non-refundable service charge that is subtracted from any refund 
otherwise due an issuer that is not approved for listing or that 
withdraws after completing the application process. Given the cost 
incurred by the Exchange in reviewing an application, the Exchange 
proposes to raise the non-refundable portion of the initial 
inclusion fee from $250 to $1,000 and to require the payment of this 
amount in advance of processing the application, in order to timely 
recoup such costs, especially in situations where these costs are 
incurred by the Exchange and the application is then withdrawn. The 
Exchange notes that this proposed change will not affect the listing 
fees paid by issuers who ultimately list on the Exchange and that 
this practice is consistent with that followed by Nasdaq. In 
addition, the Exchange notes that if an issuer applies for listing 
on both the Exchange and on Nasdaq, only a single $1,000 non-
refundable fee would be collected for review of both applications.
    The Exchange also proposes to modify the treatment of treasury 
shares for fee purposes. Under existing Section 141, Amex listing 
fees are based on all shares outstanding, including treasury shares. 
The Exchange proposes to modify Section 141 to excluse treasury 
shares when calculating shares outstanding for fee purposes \9\ and 
to clarify that annual fees billed based on shares outstanding 
information refers to information available on Exchange records as 
of December 31, and not shares outstanding information sent to the 
Exchange by issuers some time in February. This proposed change will 
result in a decrease in fees for issuers with treasury shares and 
will not affect other issuers.
---------------------------------------------------------------------------

    \9\ This is consistent with the approach taken on the Nasdaq, 
resulting in identical application across all of the NASD's 
marketplaces.
---------------------------------------------------------------------------

    Finally, as discussed above, because the Exchange proposes to 
eliminate Section 343, requiring the submission of an application 
upon the creation of a shareholder rights plan, the Exchange also 
proposes to modify Section 140, to eliminate the $1,000 fee 
associated with the shareholder rights plan application.

Schedule for Dividends

    The Exchange proposes to eliminate several archaic rules that 
require additional time between the declaration and dividend date 
for dividends of issuers that do not have transfer facilities in the 
New York City area. Given the current state of communication 
networks and electronic interaction between issuers, transfer agents 
and investors, these additional time periods are no longer 
necessary. Accordingly, the Exchange proposes to modify Sections 
502, 512, and 521 and to eliminate Section 520 to implement this 
proposed change.

Transfer Facilities

    Likewise, the Exchange proposes to remove a variety of rules 
concerning the qualification of Transfer Agents, Registrars, and 
Bond Trustees presently contained in Sections 801-811. The 
Commission regulates the transfer agent industry and, since 1976, 
has imposed a series of rules over the industry \10\ that make many 
of the Exchange's rules unnecessary. Other Exchange rules relating 
to transfer agents (as well as Agents for Payment) are archaic, as 
they limit the ability of agents with physical locations outside of 
New York to perform these functions. The Exchange also proposes to 
eliminate the requirements relating to Trustees for Bond Issues in 
Section 811. The Exchange has never experienced a problem with 
respect to the qualification of a Bond Trustee and believes that 
these matters are better left to the individual issuers and 
applicable state law. Accordingly, the Exchange proposes to delete 
Sections 801-811 and to make conforming changes to other sections 
that refer to those sections.
---------------------------------------------------------------------------

    \10\ See Exchange Act Rules 17Ad-1 through 17Ad-21T, 17 CFR 
240.17Ad-1 through 17 CFR 240.17A21T.
---------------------------------------------------------------------------

Certificate Requirements

    The Exchange also proposes to remove requirements relating to 
the form of securities and lost security holders. The rules relating 
to the form of securities are antiquated and may impede the use of 
innovations in this area, such as DTC holdings and book entry 
methods. Furthermore, the Exchange notes that there are no 
comparable rules on Nasdaq. Accordingly, the Exchange proposes

[[Page 6664]]

to delete existing Sections 820 through 830, inclusive, and Section 
841 of the Listing Standards. Likewise, the Exchange rules governing 
the replacement of lost certificates in Section 840 are no longer 
necessary in light of current practices followed by issuers and 
transfer agents.

Treasury Shares

    Existing Exchange rules require an issuer to report changes in 
the number of treasury shares. Given the changes proposed to the fee 
calculation for issuers, resulting in the exclusion of treasury 
shares from the fee base, the Exchange no longer needs this 
information. Accordingly, the Exchange proposes to eliminate Section 
901 of the Listing Standards. Furthermore, Section 903, on 
repurchases of listed company securities, in unnecessary because it 
does not impose any Exchange requirements, but merely refers issuers 
to federal securities laws. Finally, the Exchange notes that Section 
902 allows an issuer to redeem securities only in a pro rata fashion 
or by lot. The Exchange notes that issuers are governed by state law 
requirements in the redemption of securities and that as a practical 
matter, one of these methods is invariably applied. Therefore, the 
Exchange believes that Section 902 is unnecessary and proposes its 
deletion and conforming amendments to Sections 103(d), 104, and 
105(b).

Other Changes to the Exchange's Listing Requirements

    The Exchange proposes certain changes to the listing 
requirements for issuers listed on the Amex. The Exchange proposes 
to change the definition of ``public distribution'' and ``public 
shareholders'' as defined in Section 102. Currently, in determining 
the number of shares in the public, Exchange rules exclude 
concentrated holdings of 5% or greater. The comparable rules on 
Nasdaq, as well as the NYSE, only exclude holdings of 10% or 
greater. The Exchange believes that it is appropriate to exclude 
holdings of between 5% and 10% from the definition of public 
distribution and accordingly, proposes to modify Section 102.
    Next, the Exchange proposes to modify Section 120, relating to 
conflicts of interest. The existing Exchange rule states that the 
Exchange will consider conflicts situations in connection with the 
original listing of an issuer. The Exchange believes that a broader, 
ongoing review of related party transactions is appropriate and that 
the issuer's Audit Committee (or a comparable body) is an 
appropriate body for conducting such a review. Furthermore, the 
Exchange notes that under the proposed change, as in all cases, it 
may review a transaction using the Exchange's general discretionary 
authority if a transaction involved a conflict that raised public 
interest concerns. Accordingly, the Exchange proposes to adopt this 
revised listing requirement to better protect investors.\11\
---------------------------------------------------------------------------

    \11\ The Exchange notes that this proposed change is consistent 
with the rules relating to conflicts of interest that apply to 
Nasdaq issuers and NYSE issuers. See NASD Rules 4310(c)(25)(G) and 
4460(h) and NYSE Listed Company Manual Section 307.00.
---------------------------------------------------------------------------

    The Exchange also proposes to amend its rules relating to 
shareholder approval contained in Section 713 to clarify that 
shareholder approval is required prior to issuance of a security 
that has the potential to result in the issuance of 20% of the pre-
transaction common shares outstanding for less than the greater of 
book or market value of the stock. While the present language of the 
rule does not include the word potential, it is fairly implied and 
Exchange staff has consistently applied the rule to require approval 
in cases where an issuance may potentially exceed the state 
threshold. Accordingly, the Exchange proposes to modify the existing 
rule to clarify that an issuance is not permissible without 
shareholder approval when there is the potential to issue more than 
20% of the pre-transaction common shares outstanding for less than 
the greater of book or market value of the stock.

Emerging Company Marketplace

    In May 1995, the Exchange determined to discontinue the listing 
of new companies on the Emerging Company Marketplace and 
subsequently received Commission approval.\12\ Accordingly, the 
Exchange proposes to delete from the Supplement the criteria for new 
listing on the Emerging Company Marketplace given that no new issues 
are permitted to be listed on that market. Furthermore, the Exchange 
proposes to delete from the Supplement the continued listing 
criteria with respect to all issues other than common stock because 
no existing issuers rely on these provisions and no new issuers can 
be listed that would rely on these provisions. This conforming 
change is consistent with the SEC's order approving the elimination 
of the Energing Company Market.
---------------------------------------------------------------------------

    \12\ See Exchange Act Release No. 36079 (Aug. 9, 1995), 60 FR 
42926 (Aug. 17, 1995) (SE-Amex-95-23). Companies that were listed at 
the time the Emerging Company Marketplace was discontinued were 
permitted to continue their listing, subject to all the rules 
applicable to issuers on that Emerging Company Marketplace.
---------------------------------------------------------------------------

2. Statutory Basis

    The Exchange believes that the proposed rule change is 
consistent with Section 6(b)(5) of the Act,\13\ which requires, 
among other things, the Exchange's rules to be designed to prevent 
fraudulent and manipulative acts and practices and, in general, to 
protect investors and the public interest.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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 Act.

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

    The Exchange did not solicit or receive written comments on the 
proposed rule change.

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. Persons making written 
submissions should file six copies thereof with the Secretary, 
Securities and Exchange Commission, 450 Fifth Street, NW, 
Washington, DC 20549-0609. 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 such filing will also be available 
for inspection and copying at the principal office of the Amex. All 
submissions should refer to the File No. SR-Amex-99-39 and should be 
submitted by March 2, 2000.

For the Commission, by the Division of Market Regulation, pursuant 
to delegated authority.\14\
---------------------------------------------------------------------------

    \14\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 00-3034 Filed 2-9-00; 8:45 am]
BILLING CODE 8010-01-M