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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-33827; File No. SR-BSE-94-4]

Self-Regulatory Organizations; Notice of Filing of Proposed Rule

Change by the Boston Stock Exchange, Inc. Relating to Its Listing

Requirements

March 28, 1994.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act''),\1\ notice is hereby given that on February 25, 1994, the

Boston Stock Exchange, Inc. (``BSE'' or ``Exchange'') filed with the

Securities and Exchange Commission (``Commission'') the proposed rule

change as described in Items I, II and III below, which items have been

prepared by the self-regulatory organization. The Commission is

publishing this notice to solicit comments on the proposed rule change

from interested persons.

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\1\15 U.S.C. 78s(b)(1).

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I. Self-Regulatory Organization's Statement of the Terms of

Substance of the Proposed Rule Change

The BSE proposes to amend its listing requirements to impose more

stringent criteria for initial listing of securities on the

Exchange.\2\

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\2\The BSE proposes to amend Chapter XXVII--Listing Securities--

Requirements  2260, Sec. 1, which outlines mandatory listing

requirements for common stock. The Exchange generally proposes the

following changes:

A. The proposal would increase the company's tangible asset

requirement to $2 million (up from $1.5 million) of $3 million in

total assets. It would also specify that intangible assets shall

include, inter alia, goodwill, patents, licenses, and trademarks and

other assets as the Exchange shall deem intangible.

B. The proposal would increase the required outstanding public

float requirement to 750,000 shares (up from 500,000). It would also

provide that the public float requirement shall be exclusive of

shares held by directors, officers or other concentrated holdings of

5% (down from 10%) or more.

C. The proposal would increase the minimum number of beneficial

stock holders required for listing to 750 (up from 500) beneficial

stockholders exclusive of the holdings of directors, officers or

other concentrated holdings of 5% (down from 10%) or more.

Currently, with respect to companies seeking to list following an

initial public offering, the Exchange must receive assurances from

the company or its representatives that the minimum beneficial

stockholder requirement be met following the distribution of the

shares. If not met within six months of listing, the Exchange shall

take immediate action to suspend dealings until the stockholder

requirement is met. The Exchange proposes to add the following

sentence to this section: Should the company fail to meet the

requirement within 90 days of suspension, the Exchange shall file an

application for delisting.

D. The proposal would increase the minimum bid price per share

to $2.00 per share (up from $1.00 per share) at the time of listing

in the case of an initial public offering. It would also require a

bid price of $2.00 (up from $1.00) to be maintained for 45 days (up

from 30) prior to listing in the case of a company not involved in

an initial public offering.

E. The proposal would increase the net tangible asset

requirement to $2 million (up from $500,000). The proposal would,

therefore, provide that the company must have either net income of

$100,000 in two of the past three years or net tangible assets in

the amount of $2 million.

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II. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

In its filing with the Commission, the self-regulatory organization

included statements concerning the purpose of and basis for the

proposed rule change and discussed any comments it received on the

proposed rule change. The text of these statements may be examined at

the places specified in Item IV below. The self-regulatory organization

has prepared summaries, set forth in Sections A, B, and C below, of the

most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

The purpose of the proposed rule change is to amend the listing

requirements of the Exchange to establish minimum quantitative and

qualitative requirements where practicable, to modernize and clarify

the language of the rule, and to begin to respond to the Commission's

concerns regarding certain issuers and promoters seeking listing solely

as a means to avoid the requirements of SEC Rule 15c2-6.

The statutory basis for the proposed rule change is Section 6(b)(5)

of the Act in that it is designed to prevent fraudulent and

manipulative acts and practices, to promote just and equitable

principles of trade, to perfect the mechanism of a free and open market

and a national market system, and in general, to protect investors and

the public interest.

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

The Exchange does not believe that the proposed rule change will

impose any burden on competition that is not necessary or appropriate

in furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed

Rule Change Received From Members, Participants or Others

The Exchange has neither solicited nor received comments on the

proposed rule change, except from the Stock List Committee.

III. Date of Effectiveness of the Proposed Rule Change and Timing

for Commission Action

Within 35 days of the publication of this notice in the Federal

Register or within such other period (i) as the Commission may

designate up to 90 days of such date if it finds such longer period to

be appropriate and publishes its reasons for so finding or (ii) as to

which the self-regulatory organization consents, the Commission will:

(A) By order approve the proposed rule change, or

(B) Institute proceedings to determine whether the proposed rule

change should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and

arguments concerning the foregoing. Persons making written submissions

should file six copies thereof with the Secretary, Securities and

Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.

Copies of the submission, all subsequent amendments, all written

statements with respect to the proposed rule change that are filed with

the Commission, and all written communications relating to the proposed

rule change between the Commission and any person, other than those

that may be withheld from the public in accordance with the provisions

of 5 U.S.C. 552, will be available for inspection and copying at the

Commission's Public Reference Section, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such filing will also be available for

inspection and copying at the principal office of the BSE. All

submissions should refer to File No. SR-BSE-94-4 and should be

submitted by April 25, 1994.

For the Commission, by the Division of Market Regulation,

pursuant to delegated authority.

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-7968 Filed 4-1-94; 8:45 am]

BILLING CODE 8010-01-M