[Federal Register Volume 74, Number 179 (Thursday, September 17, 2009)]
[Notices]
[Pages 47842-47844]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-22368]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60644; File No. SR-NYSE-2009-83]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing of Proposed Rule Change Amending Its Initial Listing 
Fees for Operating Companies

September 10, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on August 26, 2009, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its schedule of initial listing fees 
for operating companies as set forth in Section 902.03 of the Listed 
Company Manual (the ``Manual''). A copy of this filing is available on 
the Exchange's Web site at http://www.nyse.com, at the Exchange's 
principal office and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those 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,

[[Page 47843]]

of the most significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its initial listing fees for 
operating companies set forth in Section 902.03 of the Manual, with 
retroactive application to any initial listing of new classes of 
securities on or after the date of original submission of this filing.
    Currently, companies pay initial listing fees according to the 
following schedule: $0.0048 per share for up to and including 75 
million shares, $0.00375 per share for any additional shares over 75 
million shares up to and including 300 million shares, and $0.0019 per 
share for any additional shares over 300 million shares (the ``Listing 
Fee Schedule''). The first time that an issuer lists a class of common 
shares, the issuer is also subject to a one-time special charge of 
$37,500, in addition to fees calculated according to the Listing Fee 
Schedule. The minimum and maximum listing fees applicable the first 
time an issuer lists a class of common shares are $150,000 and 
$250,000, respectively, which amounts include the one-time special 
charge of $37,500.
    Solely with respect to shares listed at the time a class of common 
shares is first listed on the Exchange, the Exchange proposes to 
replace the Listing Fee Schedule with a flat rate initial listing fee 
of $0.0032 per share.\4\ The one-time special charge of $37,500 will be 
increased to $50,000 and the minimum initial listing fee will be 
decreased from $150,000 to $125,000.\5\ No change is being made to the 
maximum initial listing fee of $250,000 at this time. The existing 
Listing Fee Schedule (the ``Listing of Additional Shares Fee 
Schedule'') will remain in effect for the listing of additional shares 
of a class of previously listed securities. In establishing at which 
tier of the Listing of Additional Shares Fee Schedule a company will 
pay fees with respect to additional shares of a previously listed 
class, the Exchange will include the shares with respect to which the 
company paid fees at the time of initial listing of that class in 
calculating the fees for additional shares.
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    \4\ Initial listing fees for the following types of listings 
will also be charged at a rate of $0.0032 per share: (i) At the time 
it first lists, an issuer lists one or more classes of preferred 
stock or warrants, whether or not common shares are also listed at 
that time; and (ii) once listed, an issuer lists a new class of 
preferred stock or warrants.
    \5\ The increase in the one-time special charge is intended to 
offset a portion of the reduction in listing fee revenue 
attributable to the proposed lower listing fee per share and 
proposed lower minimum listing fee.
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    For example: At the time Company A first lists its common stock on 
the Exchange, its initial listing application covers 30 million shares 
of its common stock. Company A must pay initial listing fees of 
$146,000, i.e., the one-time special charge of $50,000 plus $96,000 (30 
million shares multiplied by $0.0032 per share). For comparison, the 
following is how Company A would be charged for the initial listing 
application under the current Listing Fee Schedule: $181,500, i.e., the 
one-time special charge of $37,500 plus $144,000 (30 million shares 
multiplied by $0.0048 per share).
    If Company A subsequently issues an additional 100 million shares, 
Company A will pay fees under the first tier of the Listing of 
Additional Shares Fee Schedule for 45 million shares (representing the 
75 million shares that are subject to the first tier of fees minus the 
30 million shares issued at the time of original listing) and will pay 
fees under the second tier of the Listing of Additional Shares Fee 
Schedule for 55 million shares (representing the remainder of the 
shares listed in the supplemental listing application). Therefore, in 
connection with the supplemental listing application, Company A must 
pay listing fees for the listing of additional shares of $422,250, 
consisting of (i) $216,000 (i.e., 45 million shares multiplied by 
$0.0048 per share) plus (ii) $206,250 (i.e., 55 million shares 
multiplied by $0.00375 per share).\6\
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    \6\ The charge for the supplemental listing application would be 
the same under both the existing and the proposed listing fee 
schedule. Some clarifying changes have been made to the Listing of 
Additional Shares Fee Schedule as presented in Section 902.03, but 
no substantive changes are being made to the fees charged in 
connection with the listing of additional shares pursuant to a 
supplemental listing application.
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    The proposed amendments to the Exchange's initial listing fees will 
reduce the initial listing fees payable by all companies whose fees are 
not limited by the $250,000 maximum and no company will pay higher 
initial listing fees as a result of the proposed amendment. These lower 
initial listing fees will enable the Exchange to compete more 
effectively on a cost basis with other securities exchanges for 
listings of companies undertaking initial public offerings. In 
particular, the Exchange notes that smaller companies than have 
historically listed on the Exchange now qualify for listing under the 
recently adopted Assets and Equity Test \7\ and many of these companies 
would benefit from the lower minimum initial listing fee.
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    \7\ See Securities Exchange Act Release No. 58934 (November 12, 
2008), 73 FR 69708 (November 19, 2008) (SR-NYSE-2008-98).
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    The proposed new initial listing fees for the listing of new 
classes of securities are not inequitable or unfairly discriminatory, 
as all companies will be subject to the same fee schedule. While 
companies that are subject to the $250,000 maximum fee under both the 
current and the proposed fee schedule do not benefit from the reduction 
in fees, this is appropriate because these companies already benefit 
from a lower effective listing fee per share than other companies.
    The Exchange proposes to apply the listing fees as amended by this 
filing retroactively to any new classes of common or preferred equity 
securities listed on or after the date of original submission of this 
filing. The Exchange believes this approach is appropriate, as it will 
enable companies to benefit from any applicable reduction in listing 
fees without having to delay their listing until after Commission 
approval of the filing solely for the purpose of benefitting from that 
fee reduction. As noted above, the proposed amendment will lower the 
initial listing fees payable by all companies whose fees are not 
limited by the $250,000 maximum and no company will pay higher initial 
listing fees as a result of the proposed amendment.
    The reduction in the Exchange's listing fee revenue as a result of 
the proposed rule change is not expected to be substantial and the 
Exchange will continue to have sufficient revenue to continue to 
adequately fund its regulatory activities.
2. Statutory Basis
    The bases under the Act for this proposed rule change are the 
requirement under Section 6(b)(4) \8\ that an exchange have rules that 
provide for the equitable allocation of reasonable dues, fees and other 
charges among its members, listed companies and other persons using its 
facilities and the requirement under Section 6(b)(5) \9\ that an 
exchange have rules that are not designed to permit unfair 
discrimination between customers, issuers, brokers, or dealers. The 
Exchange believes that the proposed new schedule of initial listing 
fees represents an equitable allocation of fees

[[Page 47844]]

among its listed companies, as all companies will be subject to the 
same fee schedule. The proposed new initial listing fees for the 
listing of new classes of securities are not inequitable or unfairly 
discriminatory, as all companies will be subject to the same fee 
schedule. While companies that are subject to the $250,000 maximum fee 
under both the current and the proposed fee schedule do not benefit 
from the reduction in fees, this is appropriate because these companies 
already benefit from a lower effective listing fee per share than other 
companies.
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    \8\ 15 U.S.C. 78f(b)(4).
    \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 will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to 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 self-regulatory organization consents, the Commission will:

    (A) By order approve the proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-NYSE-2009-83 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSE-2009-83. This file 
number should be included on the subject line if e-mail is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for inspection and 
copying in the Commission's Public Reference Room, 100 F Street, NE., 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the filing will also be available for 
inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-NYSE-2009-83 and should be 
submitted on or before October 8, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-22368 Filed 9-16-09; 8:45 am]
BILLING CODE 8010-01-P