[Federal Register Volume 69, Number 43 (Thursday, March 4, 2004)]
[Notices]
[Pages 10285-10286]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-4835]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49331; File No. SR-Amex-2004-15]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto by 
the American Stock Exchange LLC Relating to Disclosure of Independent 
Director Determinations

February 27, 2004.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on February 23, 2004, the American Stock Exchange LLC (the ``Amex'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by Amex. On February 26, 
2004, the Exchange filed Amendment No. 1 to the proposed rule 
change.\3\ Amex has filed the proposed rule change as a ``non-
controversial'' rule change under Rule 19b-4(f)(6) under the Act,\4\ 
which renders the proposal effective upon filing with the Commission. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Letter from Claudia Crowley, Vice President, Listing 
Qualifications, Amex, to Nancy Sanow, Assistant Director, Division 
of Market Regulation, Commission, dated February 26, 2004. Amendment 
No. 1 made a technical correction to the text of the proposed rule 
change to reflect a revision that was made in File No. SR-Amex-2004-
06. See Securities Exchange Act Release No. 49295 (February 23, 
2004).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Amex proposes to amend section 802 of the Amex Company Guide to 
specify that a listed company must disclose those directors that its 
board of directors has determined to be independent. The text of the 
proposed rule change is available at the Office of the Secretary, Amex, 
and at the Commission.

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 Amex 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 Amex 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
    On December 1, 2003 the Commission approved comprehensive 
enhancements to the corporate governance requirements applicable to 
listed companies in order to promote accountability, transparency, and 
integrity by such companies, including the changes required by 
Commission Rule 10A-3 \5\ with respect to listed company audit 
committees.\6\ Among other things, these enhancements require that for 
most listed companies at least a majority of the directors on the 
company's board of directors must be independent as defined in section 
121A of the Amex Company Guide. Small business issuers are required to 
maintain a board of directors comprised of at least 50% independent 
directors.\7\ In order to provide increased disclosure to investors, 
the Exchange is proposing to amend section 802 of the Amex Company 
Guide to specify that a listed company must disclose in its annual 
meeting proxy statement (or in its next annual report on SEC Form 10-K 
or equivalent if the issuer does not file an annual proxy statement) 
those directors that the board of directors has determined to be 
independent pursuant to section 121A of the Amex Company Guide.
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    \5\ 17 CFR 240.10A-3.
    \6\ See Securities Exchange Act Release No. 48863 (December 1, 
2003), 68 FR 68432 (December 8, 2003) (order approving File No. SR-
Amex-2003-65).
    \7\ The disclosure required in the proposed rule change will 
apply equally to small business issuers. Telephone conference 
between Claudia Crowley, Vice President, Listing Qualifications, 
Amex, and Geoffrey Pemble, Special Counsel, Division of Market 
Regulation, Commission, on February 25, 2004.
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2. Statutory Basis
    The Amex believes that the proposed rule change, as amended, is 
consistent with section 6(b) of the Act \8\ in general and furthers the 
objectives of section 6(b)(5) of the Act,\9\ in particular, in that it 
is designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities, and to remove impediments to and perfect 
the mechanism of a free and open market and a national market system.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change, as 
amended, will impose any burden on competition.

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

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

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

    The proposed rule change has been filed by the Amex as a ``non-
controversial'' rule change pursuant to section 19(b)(3)(A) of the Act 
\10\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\11\
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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6).
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    Consequently, because the foregoing proposed rule change: (1) Does 
not significantly affect the protection of investors or the public 
interest, (2) does not impose any significant burden on competition, 
and (3) by its terms does not become operative for 30 days after the 
date of this filing, or such shorter time as the Commission may 
designate, if consistent with the protection of investors and the 
public interest, and the self-regulatory organization has given the 
Commission written notice of its intent to file the proposed rule 
change, along with a brief description and text of the proposed rule 
change, at least five business days prior to the date of filing of the 
proposed rule change, it has become effective pursuant to section 
19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder.
    Pursuant to Rule 19b-4(f)(6)(iii),\12\ a proposed ``non-
controversial'' rule change does not become operative for 30 days after 
the date of filing, or such shorter time as the Commission may

[[Page 10286]]

designate if consistent with the protection of investors and the public 
interest. The Amex has requested that the Commission waive the 30-day 
operative delay and the five-business day pre-filing requirement to 
permit the Exchange to implement the proposal immediately.
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    \12\ 17 CFR 240.19b-4(f)(6)(iii).
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    The Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest. 
The revision contained in the proposed rule change relating to 
disclosure of independent director determinations is substantially 
identical to a rule change by the National Association of Securities 
Dealers, Inc. that was recently approved by the Commission.\13\ In 
addition, waiving the 30-day operative delay will ease implementation 
of the new rule and assure consistent application of corporate 
governance disclosure requirements between listing markets. For these 
reasons, the Commission designates the proposed rule change to be 
effective and operative upon filing with the Commission.\14\ The 
Commission also waives the five business day pre-filing requirement.
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    \13\ See Securities Exchange Act Release No. 48745 (November 4, 
2003), 68 FR 64154 (November 12, 2003) (approval of File Nos. SR-
NYSE-2002-33, SR-NASD-2002-77, SR-NASD-2002-80, SR-NASD-2002-138, 
SR-NASD-2002-139, and SR-NASD-2002-141).
    \14\ For the purposes only of waiving the operative date of this 
proposal, the Commission has considered the proposed rules impact on 
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the proposed rule change, as amended, 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. Comments may also be submitted 
electronically at the following e-mail address: [email protected]. 
All comment letters should refer to File No. SR-Amex-2004-15. This file 
number should be included on the subject line if e-mail is used. To 
help the Commission process and review your comments more efficiently, 
comments should be sent in hardcopy or by e-mail but not by both 
methods. Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for inspection and 
copying at the Commission's Public Reference 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-2004-15 and should be submitted by March 25, 2004.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 04-4835 Filed 3-3-04; 8:45 am]
BILLING CODE 8010-01-P