Quiero saber acerca de...

8240

Federal Register / Vol. 86, No. 22 / Thursday, February 4, 2021 / Notices
consistent with Section 6b8 of the Act.
Finally, the Commission believes that the Exchanges proposed clarifying changes to Rule 11.510 add helpful detail that will further enhance investors understanding of how IEX
operates in a manner consistent with the Act, thereby helping to protect investors and the public interest consistent with Section 6b5 of the Act.
IV. Conclusion It is therefore ordered, pursuant to Section 19b2 of the Act,28 that the proposed rule change SRIEX2020
18 be and hereby is approved.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.29
J. Matthew DeLesDernier, Assistant Secretary.
FR Doc. 202102266 Filed 2321; 8:45 am BILLING CODE 801101P

Release No. 3491012; File No. SRNYSE
202106

Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Sections 902.02 and 902.11 of the NYSE Listed Company Manual To Defer the Billing of Initial Listing Fees Payable by Acquisition Companies January 29, 2021.

jbell on DSKJLSW7X2PROD with NOTICES

Pursuant to Section 19b1 1 of the Securities Exchange Act of 1934
Act 2 and Rule 19b4 thereunder,3
notice is hereby given that, on January 21, 2021, the New York Stock Exchange LLC NYSE 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 selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.
I. Self-Regulatory Organizations Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Sections 902.02 and 902.11 of the NYSE
Listed Company Manual the Manual U.S.C. 78sb2.
CFR 200.303a12.
1 15 U.S.C. 78sb1.
2 15 U.S.C. 78a.
3 17 CFR 240.19b4.

II. Self-Regulatory Organizations 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.
A. Self-Regulatory Organizations Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change
SECURITIES AND EXCHANGE
COMMISSION

28 15

to defer the billing of initial listing fees payable by Acquisition Companies. The text of the. The proposed rule change is available on the Exchanges website at www.nyse.com, at the principal office of the Exchange, and at the Commissions Public Reference Room.

1. Purpose Section 102.06 sets forth listing requirements applicable to any company with a business plan is to complete an initial public offering and engage in a merger or acquisition with one or more unidentified companies within a specific period Acquisition Company. Section 902.11 provides that an Acquisition Company is subject to a flat initial listing fee of $85,000 at the time of initial listing. Based on experience listing these companies, the Exchange proposes to defer the billing and payment of initial listing fees until one year from the date of an Acquisition Companys initial listing on the Exchange. For the avoidance of doubt, such fee is owed to the Exchange at the time of initial listing based on the fee schedule in effect on the date of listing but will be billed by the Exchange and become payable on the first anniversary of the date of listing. The Exchange notes that the Nasdaq Stock Market Nasdaq is the Exchanges primary competitor in the market for the listing of Acquisition Companies and that Nasdaq has a deferral provision comparable to the deferral the Exchange proposes.4
Acquisition Companies are formed to raise capital in an initial public offering IPO with the purpose of using the proceeds to acquire one or more unspecified businesses or assets to be
29 17

VerDate Sep<11>2014

17:13 Feb 03, 2021

4 See Securities Exchange Act Release No. 89403
July 31, 2020 sic, 85 FR 46198 July 31, 2008
sic SRNASDAQ2020038.

Jkt 253001

PO 00000

Frm 00081

Fmt 4703

Sfmt 4703

identified after the IPO. However, unlike other types of listed companies that have pre-existing operations or that fund their operations by proceeds raised from the IPO, following the IPO, an Acquisition Company funds a trust account with an amount typically equal to 100% of the gross proceeds of the IPO.5 As such, operating expenses are typically borne by the Acquisition Companys sponsor, particularly during the initial post-IPO period. The Acquisition Companys sponsor is the entity or management team that forms the Acquisition Company and, typically, runs the operations of the Acquisition Company until an appropriate target company is identified and the business combination is consummated. The funds in the trust account are typically invested in short-term U.S. government securities or held as cash, earning interest over time. Thus, the unique structure of an Acquisition Company results in the sponsors extreme fee sensitivity, particularly during the initial post-IPO period before any substantial amount of interest is earned from the trust account. The Exchange believes that the market practice of depositing 100% of the gross proceeds of the IPO in a trust account rather than the minimum of 90% required by Section 102.06 benefits shareholders and is consistent with investor protection because it assures that shareholders choosing to exercise their right to redeem shares for a pro rata share of the trust account will receive the full IPO price paid, rather than a lesser amount guaranteed by Exchange rules. Accordingly, to encourage this market practice the Exchange believes it is appropriate to defer the payment of the initial listing fee owed by an Acquisition Company listed on the Exchange until the first anniversary of the date of listing. The initial listing fee paid at that time would be based on the fee schedule in effect at the time of initial listing.
The Exchange believes that the proposed fee deferral would provide an incentive to sponsors to list Acquisition Companies on the Exchange. The Exchange also believes it is reasonable to balance its need to remain competitive with other listing venues, while at the same time ensuring 5 Section 102.06 of the Manual provides that an Acquisition Company could pay operating and other expenses, subject to a limitation that 90% of the gross proceeds of the companys offering must be retained in the trust account. However, the Exchange understands that marketplace demands typically dictate that 100% of the gross proceeds from the IPO be kept in the trust account and that only interest earned on that account be used to pay taxes and a limited amount of operating expenses.

E:FRFM04FEN1.SGM

04FEN1