Form 144 30 Day Federal Register Notice

Federal Register / Vol. 85, No. 111 / Tuesday, June 9, 2020 / Notices
SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–203, OMB Control No.
3235–0195]

Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736

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Extension:
Rule 17Ab2–1, Form CA–1

Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the collection of information
provided for in Rule 17Ab2–1 (17 CFR
240.17Ab2–1) and Form CA–1:
Registration of Clearing Agencies (17
CFR 249b.200) under the Securities
Exchange Act of 1934 (‘‘Exchange Act’’)
(15 U.S.C. 78a et seq.). The Commission
plans to submit this existing collection
of information to the Office of
Management and Budget (‘‘OMB’’) for
extension and approval.
Rule 17Ab2–1 and Form CA–1 require
clearing agencies to register with the
Commission and to meet certain
requirements with regard to, among
other things, the clearing agency’s
organization, capacities, and rules. The
information is collected from the
clearing agency upon the initial
application for registration on Form
CA–1. Thereafter, information is
collected by amendment to the initial
Form CA–1 when changes in
circumstances that render certain
information on Form CA–1 inaccurate,
misleading, or incomplete necessitate
modification of the information
previously provided to the Commission.
The Commission uses the information
disclosed on Form CA–1 to (i)
determine whether an applicant meets
the standards for registration set forth in
Section 17A of the Exchange Act, (ii)
enforce compliance with the Exchange
Act’s registration requirement, and (iii)
provide information about specific
registered clearing agencies for
compliance and investigatory purposes.
Without Rule 17Ab2–1, the Commission
could not perform these duties as
statutorily required.
The Commission staff estimates that
the average Form CA–1 requires
approximately 340 hours to complete
and submit for approval, and that on
average, the Commission receives one
application each year. The Commission
staff estimates that completion of an

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initial Form CA–1 will result in an
internal cost of compliance of
approximately $132,140 per year. The
Commission staff estimates that it
receives one amendment per year, and
that an amendment requires
approximately 60 hours of the exempt
or registered clearing agency’s staff time.
The Commission staff estimates that
amendment of a filed Form CA–1 will
result in an internal cost of compliance
of approximately $25,480 per year.
Therefore, the aggregate hour burden is
approximately 400 hours per year (340
+ 60) and the aggregate internal cost of
compliance is approximately $157,620
per year ($132,140 + $25,480).
The external costs associated with
work on Form CA–1 include fees
charged by outside lawyers and
accountants to assist the applicant or
registrant to collect and prepare the
information sought by the form (though
such consultations are not required by
the Commission). The Commission staff
estimates that these external costs are
more likely when novel questions arise
under a new application, rather than
under periodic review and amendment.
The staff estimates an annual external
cost of 45 hours of an Attorney’s time
(estimated at $420 per hour) and 10
hours of a Senior Accountant’s time
(estimated at $219 per hour) for
preparation of the Form CA–1, resulting
in an aggregate external cost of
approximately $21,090 per year (18,900
+ 2,190).
Written comments are invited on: (a)
Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information shall have practical utility;
(b) the accuracy of the Commission’s
estimates of the burden of the proposed
collection of information; (c) ways to
enhance the quality, utility, and clarity
of the information collected; and (d)
ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted in
writing within 60 days of this
publication.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
Please direct your written comments
to: David Bottom, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Cynthia
Roscoe, 100 F Street NE, Washington,

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35357

DC 20549, or send an email to: PRA_
[email protected].
Dated: June 3, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–12390 Filed 6–8–20; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–112, OMB Control No.
3235–0101]

Submission for OMB Review;
Comment Request
Upon Written Request Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Extension:
Form 144

Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget this
request for extension of the previously
approved collections of information
discussed below.
Form 144 (17 CFR 239.144) is used to
report the sale of securities during any
three-month period that exceeds 5,000
shares or other units and has an
aggregate sales price that does not
exceed $50,000. Under Sections
2(a)(11), 4(a)(1), 4(a)(2), 4(a)(4) and 19(a)
of the Securities Act of 1933 (15 U.S.C.
77b(a)(11), 77d(a)(1), 77d(a)(2), 77d(a)(4)
and 77s (a)) and Rule 144 (17 CFR
230.144) there under, the Commission is
authorized to solicit the information
required to be supplied by Form 144.
The objectives of the rule could not be
met, if the information collection was
not required. The information collected
must be filed with the Commission and
is publicly available. Form 144 takes
approximately one burden hour per
response and is filed by 33,725
respondents for a total of 33,725 total
burden hours.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
The public may view background
documentation for this information
collection at the following website:
www.reginfo.gov. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function. Written comments and

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35358

Federal Register / Vol. 85, No. 111 / Tuesday, June 9, 2020 / Notices

recommendations for the proposed
information collection should be sent
within 30 days of publication of this
notice to (i) www.reginfo.gov/public/do/
PRAMain and (ii) David Bottom,
Director/Chief Information Officer,
Securities and Exchange Commission,
c/o Cynthia Roscoe, 100 F Street NE,
Washington, DC 20549, or by sending an
email to: [email protected].
Dated: June 3, 2020.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–12392 Filed 6–8–20; 8:45 am]
BILLING CODE 8011–01–P

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

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–88999; File No. SR–NYSE–
2020–42]

Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend
Section 902.02 of the NYSE Listed
Company Manual Concerning PreRevenue Companies That Can Qualify
for Reduced Listing and Annual Fees
June 3, 2020.

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 May 21,
2020, 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 selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.

jbell on DSKJLSW7X2PROD with NOTICES

I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Section 902.02 of the NYSE Listed
Company Manual (the ‘‘Manual’’) to
modify the definition of a Pre-Revenue
Company contained in that rule. The
proposed rule change is available on the
Exchange’s website at www.nyse.com, at
the principal office of the Exchange, and
at the Commission’s Public Reference
Room.
1 15

U.S.C.78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15

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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 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,
of the most significant parts of such
statements.

1. Purpose
Section 902.02 of the Manual includes
a provision providing for modified
listing and annual fees for companies
that meet the definition of a PreRevenue Company set forth in that rule.
For purposes of this provision, a ‘‘PreRevenue Company’’ is a company
whose initial listing date is on or after
June 1, 2019, and which has not
recorded revenue in excess of $5 million
in either (i) the most recent completed
fiscal year prior to listing or (ii) during
the year of listing through the most
recently completed fiscal quarter before
the listing date.4
In adding the provisions specific to
Pre-Revenue Companies,5 the Exchange
noted that its Global Market
Capitalization Test (as set forth in
Section 102.01C of the Manual) allows
the Exchange to list companies that
have not yet recorded any significant
revenues, provided the issuer has at
least a $200 million global market
capitalization and meets the other
4 The Annual Fees of any company which
qualifies as a Pre-Revenue Company at the time of
listing will be calculated quarterly for the fiscal
quarter in which it lists and in each of the
succeeding 12 full fiscal quarters, at a rate of onefourth of the applicable Annual Fee rate. The total
fees (including Listing Fees and Annual Fees, but
excluding listing fees paid at the time of initial
listing) that may be billed to such an issuer during
this period will be subject to a $25,000 cap in the
fiscal quarter in which the issuer lists and in each
of the succeeding 12 full fiscal quarters. This fee
cap is subject to the same exclusions as apply in
relation to the $500,000 per year fee cap described
in the subsection of Section 902.02 entitled ‘‘Total
Maximum Fee Payable in a Calendar Year.’’ If there
are one or more fiscal quarters remaining in the
calendar year after the conclusion of the period
described herein, the issuer will, on a prorated
basis, be billed the regular Annual Fee subject to
the $500,000 total fee cap for the remainder of that
calendar year.
5 See Exchange Act Release No. 85961 (May 29,
2019), 84 FR 25856 (June 4, 2019 (SR–NYSE– 2019–
30).

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requirements for listing. These
companies are typically engaged in
research and development (in many
cases they are biotechnology companies
focused on developing new drug
candidates) or are in the early stages of
commercialization of a product.
Generally, a company of this kind relies
primarily on the proceeds from its
initial public offering to fund its
operations. As such, the fees charged by
the Exchange represent a more
significant expense for these companies
than they do for other newly-listed
companies and in many cases these fees
are an impediment to the Exchange in
competing for the listing of these
companies. The adoption of the special
provisions applicable to Pre-Revenue
Companies was intended to address the
particular difficulties faced by PreRevenue Companies in being able to pay
the Exchange’s fees.
Since adopting the provisions for PreRevenue Companies, the Exchange has
observed that some companies that
would otherwise qualify as a PreRevenue Company will have a single
revenue-generating event that is not
typical for a company at that stage in its
life cycle. An event of this nature
renders the company ineligible for PreRevenue Company status,
notwithstanding the fact that the
company has not previously generated
any material revenue and does not have
the prospect of generating any
meaningful additional revenue for the
foreseeable future. An example of this
sort of one-time revenue event that the
Exchange has observed is a one-time
licensing payment received by a
biotechnology company that is
otherwise fully engaged in precommercial research and development
activity and does not generate any
revenue in the ordinary course. The
Exchange believes that a company that
has this sort of event that is anomalous
given the nature of that company’s
business can still be the kind of
company for which the Pre-Revenue
Company provision was designed. Such
a company continues to face the same
challenges faced by a Pre-Revenue
Company. Consequently, the Exchange
now proposes to amend the definition of
a Pre-Revenue Company to provide that,
in determining whether a company
qualifies as a Pre-Revenue Company, the
Exchange will exclude from its
calculations any one-time non-recurring
revenue items.6
6 The determination of Pre-Revenue Company
status is made at the time of initial listing.
Therefore, there are no companies currently listed
that would benefit from the proposed modification
to the definition of Pre-Revenue Company.

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