Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to the Nasdaq Listing Rules To Make Certain Conforming and Technical Changes, 46258-46260 [E9-21584]
Download as PDF
<![CDATA[
46258
Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Notices
out their investment objectives with
exchange-traded products.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
CBOE does not believe that the
proposed rule change will impose any
burden on competition 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
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) 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, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) of the Act 8 and Rule
19b–4(f)(6) thereunder.9
As for permitting FLEX Options on
Corporate Debt Security Options, the
Exchange notes that new products
brought up and approved by the SEC
during the past couple of years (e.g.,
Range Options, binary options, Credit
Options) have contained rules
designating them as FLEX eligible. As a
result, the Exchange believes the
proposed change is consistent with
existing rules for products and conforms
the rules for Corporate Debt Security
Options to other existing product rules.
For the foregoing reasons, the Exchange
believes the rule filing qualifies for
expedited effectiveness as a ‘‘noncontroversial’’ rule change under
paragraph (f)(6) of Rule 19b–4 of the
Act.
At any time within 60 days of the
filing of such 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
jlentini on DSKJ8SOYB1PROD with NOTICES
8 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
provide the Commission with 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, or such
shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
9 17
VerDate Nov<24>2008
17:32 Sep 04, 2009
Jkt 217001
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 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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–CBOE–2009–053 on the
subject line.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–21582 Filed 9–4–09; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–60590; File No. SR–
NASDAQ–2009–078]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change to the
Nasdaq Listing Rules To Make Certain
Conforming and Technical Changes
August 31, 2009.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
• Send paper comments in triplicate
notice is hereby given that on August
to Elizabeth M. Murphy, Secretary,
18, 2009, The NASDAQ Stock Market
Securities and Exchange Commission,
LLC (‘‘Nasdaq’’) filed with the Securities
100 F Street, NE., Washington, DC
and Exchange Commission
20549–1090.
(‘‘Commission’’) the proposed rule
All submissions should refer to File
change as described in Items I, II and III
Number SR–CBOE–2009–053. This file
below, which Items have been prepared
number should be included on the
by Nasdaq. Nasdaq has designated the
subject line if e-mail is used. To help the
proposed rule change as constituting a
Commission process and review your
non-controversial rule change under
comments more efficiently, please use
Rule 19b–4(f)(6) under the Act,3 which
only one method. The Commission will
renders the proposal effective upon
post all comments on the Commission’s
filing with the Commission. The
Internet Web site (https://www.sec.gov/
Commission is publishing this notice to
rules/sro.shtml). Copies of the
solicit comments on the proposed rule
submission, all subsequent
change from interested persons.
amendments, all written statements
I. Self-Regulatory Organization’s
with respect to the proposed rule
Statement of the Terms of Substance of
change that are filed with the
the Proposed Rule Change
Commission, and all written
communications relating to the
Nasdaq proposes to revert to the
proposed rule change between the
previously approved requirements of
Commission and any person, other than certain listing standards that were
those that may be withheld from the
inadvertently changed when adopting
public in accordance with the
the new Listing Rules, and to complete
provisions of 5 U.S.C. 552, will be
certain conforming changes to the
available for inspection and copying in
Listing Rules that were not fully
the Commission’s Public Reference
implemented with their adoption. The
Room, 100 F Street, NE., Washington,
text of the proposed rule change is
DC 20549, on official business days
below. Proposed new language is
between the hours of 10 a.m. and 3 p.m. italicized and proposed deletions are in
Copies of such filing also will be
brackets.4
available for inspection and copying at
the principal office of the Exchange. All 5415. Initial Listing Requirements for
Preferred Stock and Secondary Classes
comments received will be posted
of Common Stock
without change; the Commission does
not edit personal identifying
(a) No change.
information from submissions. You
10 17 CFR 200.30–3(a)(12).
should submit only information that
1 15 U.S.C. 78s(b)(1).
you wish to make available publicly. All
2 17 CFR 240.19b–4.
submissions should refer to File No.
3 17 CFR 240.19b–4(f)(6).
SR–CBOE–2009–053 and should be
4 Changes are marked to the rules of The
submitted on or before September 29,
NASDAQ Stock Market LLC found at https://
2009.
nasdaqomx.cchwallstreet.com.
Paper Comments
PO 00000
Frm 00179
Fmt 4703
Sfmt 4703
E:\FR\FM\08SEN1.SGM
08SEN1
Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Notices
(b) When the Company’s Primary
Equity Security is not listed on [either]
the Global Market or is not a Covered
Security, the preferred stock and/or
secondary class of common stock may
be listed on the Global Market so long
as it satisfies the initial listing criteria
for Primary Equity Securities set forth in
Rule 5405.
*
*
*
*
*
5460. Continued Listing Requirements
for Preferred Stock and Secondary
Classes of Common Stock
(a) When the Company’s Primary
Equity Security of the Company is listed
on the Global Market or is a Covered
Security [another National Securities
Exchange], the preferred stock or
secondary class of common stock must
meet all of the requirements set forth in
(1) through (5) below.
(1) At least 100,000 Publicly Held
Shares;
(2) A Market Value of Publicly Held
Shares of at least $1,000,000;
(3) Minimum bid price of at least $1
per share;
(4) At least 100 Public Holders; and
(5) At least two registered and active
Market Makers.
(b) When the Primary Equity Security
of the Company is not listed on [either]
the Global Market or is not a Covered
Security [another National Securities
Exchange], the preferred stock and/or
secondary class of common stock may
continue to be listed on the Global
Market so long as it satisfies the
continued listing criteria for Primary
Equity Securities set forth in Rule 5450.
*
*
*
*
*
jlentini on DSKJ8SOYB1PROD with NOTICES
5615. Exemptions From Certain
Corporate Governance Requirements
This rule provides the exemptions
from the corporate governance rules
afforded to certain types of Companies,
and sets forth the phase-in schedules for
initial public offerings, Companies
emerging from bankruptcy and
Companies transferring from other
markets. This rule also describes the
applicability of the corporate
governance rules to controlled
companies and sets forth the phase-in
schedule afforded to Companies ceasing
to be controlled companies.
(a) No change.
(1) No change.
IM–5615–1. No change.
(2) No change.
IM–5615–2. No change.
(3) No change.
IM–5615–3. No change.
(4) No change.
(5) Management Investment
Companies
VerDate Nov<24>2008
17:32 Sep 04, 2009
Jkt 217001
Management investment companies
(including business development
companies) are subject to all the
requirements of the Rule 5600 Series,
except that management investment
companies registered under the
Investment Company Act of 1940 are
exempt from the [requirements of]
Independent Directors requirement, the
Independent Director Oversight of
Executive Officer Compensation and
Director Nominations requirements, and
the Code of Conduct [requirements]
requirement, set forth in Rules 5605(b),
(d) and (e), and 5610, respectively.
IM–5615–4. Management Investment
Companies
Management investment companies
registered under the Investment
Company Act of 1940 are already
subject to a pervasive system of federal
regulation in certain areas of corporate
governance covered by 5600. In light of
this, Nasdaq exempts from [Rule] Rules
5605(b), (d), (e) and 5610 management
investment companies registered under
the Investment Company Act of 1940.
Business development companies,
which are a type of closed-end
management investment company
defined in Section 2(a)(48) of the
Investment Company Act of 1940 that
are not registered under that Act, are
required to comply with all of the
provisions of the Rule 5600 Series.
(b)–(c) No change.
IM–5615–5. No change.
*
*
*
*
*
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
Nasdaq 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. Nasdaq 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 March 12, 2009, Nasdaq filed a
proposed rule change to revise the rules
relating to the qualification, listing, and
delisting of companies listed on, or
applying to list on, Nasdaq to improve
the organization of the rules, eliminate
redundancies and simplify the rule
PO 00000
Frm 00180
Fmt 4703
Sfmt 4703
46259
language.5 These new listing rules (the
‘‘Listing Rules’’) were effective April 13,
2009. Nasdaq has observed that the
March filing introduced inadvertent
changes in the Listing Rules related to
the Global Market listing requirements
for preferred stock and secondary
classes of securities, and to the
governance requirements applicable to
management investment companies
registered under the Investment
Company Act of 1940.6 This filing
modifies those rules to revert to the
requirements as they previously existed
in the listing rules (the ‘‘Old Rules’’),
and to make certain conforming
changes.7
Nasdaq is proposing technical
changes to conform Listing Rule 5415(b)
and Listing Rules 5460(a) and (b) with
the meaning of Old Rules 4420(k) and
4450(h), respectively, and to make them
consistent with each other and the
analogous Capital Market rules. Old
Rules 4420(k) and 4450(h) provided
quantitative initial and continued listing
requirements for preferred stock and
secondary classes of common stock.
These rules also allowed the application
of the respective initial and continued
listing requirements applicable to
common stock if the issuer’s common
stock or common stock equivalent
security was not listed on either Nasdaq
or another national securities exchange.
In adopting Listing Rule 5415(a),
Nasdaq replaced the term ‘‘national
securities exchange’’ with the newlydefined term ‘‘Covered Security,’’ 8
which was also used in the analogous
Capital Market Listing Rules 5510 and
5555. Nasdaq did not, however, make
conforming changes to Listing Rules
5415(b) and 5460 to replace the old term
with the new. Further, in the case of
Rule 5415(b), rule text inadvertently
omits the word ‘‘not,’’ which is
necessary for the rule to retain its
meaning. In the case of Rules 5460(a)
and (b), the term ‘‘Covered Security’’
was not used at all. Accordingly,
Nasdaq is proposing technical changes
to Listing Rule 5415(b), and Listing
Rules 5460(a) and (b) to make them
consistent with each other and Rules
5610 and 5655, the analogous Capital
Market rules.
5 Securities Exchange Act Release No. 59663
(March 31, 2009), 74 FR 15552 (April 6, 2009) (SR–
NASDAQ–2009–018).
6 15 U.S.C. 80–a1 [sic] et seq.
7 The text of Nasdaq’s prior rules is included in
Exhibit 5B of SR–NASDAQ–2009–018, supra note
5, available at: https://nasdaq.cchwallstreet.com/
NASDAQ/pdf/nasdaq-filings/2009/SR-NASDAQ2009-018.pdf.
8 Listing Rule 5005(a)(9) defines a Covered
Security as ‘‘a security described in Section 18(b)
of the Securities Act of 1933.’’
E:\FR\FM\08SEN1.SGM
08SEN1
46260
Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Notices
jlentini on DSKJ8SOYB1PROD with NOTICES
Under Old Rule 4350(a)(2) and IM–
4350–6, a management investment
company registered under the
Investment Company Act of 1940 9 was
exempt from Old Rule 4350(c), which
contained the requirements for a
company to have a majority
independent board, hold executive
sessions, and for independent directors
to make certain compensation and
nomination decisions, and Old Rule
4350(n), which contained the code of
conduct requirement. Old Rule
4350(a)(2) was moved to Listing Rule
5615(a)(5) and exempts a registered
management investment company from
Listing Rule 5605(b), which contains the
requirement for a company to have a
majority independent board and
executive sessions, and Listing Rule
5610, which contains the code of
conduct requirement. However, the part
of Old Rule 4350(c) which relates to the
requirement for independent directors
to make certain compensation and
nomination decisions was moved to
Listing Rules 5605(d) and (e), both of
which are not cross-referenced in
Listing Rule 5615(a)(5). As a
consequence, Listing Rule 5615(a)(5) no
longer contains the full range of
exemptions that were previously
provided under Old Rule 4350(a)(2).
Accordingly, Nasdaq is proposing to
amend the cross-reference found in
Listing Rule 5615(a)(5) and IM–5615–4
to include Listing Rules 5605(d) and (e),
thus conforming Listing Rule 5615(a)(5)
with Old Rule 4350(a)(2). Nasdaq also
proposes to expand the explanation of
the cross references in the rule,
consistent with the style of the Listing
Rules.
2. Statutory Basis
Nasdaq believes that the proposed
rule change is consistent with the
provisions of Section 6 of the Act,10 in
general and with Sections 6(b)(5) of the
Act,11 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 regulating, clearing,
settling, processing information with
respect to, and facilitating transactions
in securities, to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest. The
proposed rule change is designed to
revert to the previously approved
requirements of certain listing standards
9 15
U.S.C. 80–a1 [sic] et seq.
U.S.C. 78f.
11 15 U.S.C. 78f(b)(5).
10 15
VerDate Nov<24>2008
17:32 Sep 04, 2009
Jkt 217001
that were inadvertently changed when
adopting the new Listing Rules, and to
complete certain conforming changes to
the Listing Rules that were not fully
implemented with their adoption.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Nasdaq does not believe that the
proposed rule change will impose any
burden on competition 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 either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) 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, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) 12 of the Act and
Rule 19b–4(f)(6) thereunder.13
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 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 (https://www.sec.gov/
rules/sro.shtml); or
12 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
provide the Commission with 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, or such
shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–NASDAQ–2009–078 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–NASDAQ–2009–078. 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 (https://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 such filing also will 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 No.
SR–NASDAQ–2009–078 and should be
submitted on or before September 29,
2009.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–21584 Filed 9–4–09; 8:45 am]
BILLING CODE 8010–01–P
13 17
PO 00000
Frm 00181
Fmt 4703
Sfmt 4703
14 17
E:\FR\FM\08SEN1.SGM
CFR 200.30–3(a)(12).
08SEN1
]]>Agencies
[Federal Register Volume 74, Number 172 (Tuesday, September 8, 2009)]
[Notices]
[Pages 46258-46260]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-21584]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-60590; File No. SR-NASDAQ-2009-078]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
to the Nasdaq Listing Rules To Make Certain Conforming and Technical
Changes
August 31, 2009.
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 August 18, 2009, The NASDAQ Stock Market LLC (``Nasdaq'') 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 Nasdaq. Nasdaq has designated the proposed rule change
as constituting a non-controversial rule change under Rule 19b-4(f)(6)
under the Act,\3\ 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Nasdaq proposes to revert to the previously approved requirements
of certain listing standards that were inadvertently changed when
adopting the new Listing Rules, and to complete certain conforming
changes to the Listing Rules that were not fully implemented with their
adoption. The text of the proposed rule change is below. Proposed new
language is italicized and proposed deletions are in brackets.\4\
---------------------------------------------------------------------------
\4\ Changes are marked to the rules of The NASDAQ Stock Market
LLC found at https://nasdaqomx.cchwallstreet.com.
---------------------------------------------------------------------------
5415. Initial Listing Requirements for Preferred Stock and Secondary
Classes of Common Stock
(a) No change.
[[Page 46259]]
(b) When the Company's Primary Equity Security is not listed on
[either] the Global Market or is not a Covered Security, the preferred
stock and/or secondary class of common stock may be listed on the
Global Market so long as it satisfies the initial listing criteria for
Primary Equity Securities set forth in Rule 5405.
* * * * *
5460. Continued Listing Requirements for Preferred Stock and Secondary
Classes of Common Stock
(a) When the Company's Primary Equity Security of the Company is
listed on the Global Market or is a Covered Security [another National
Securities Exchange], the preferred stock or secondary class of common
stock must meet all of the requirements set forth in (1) through (5)
below.
(1) At least 100,000 Publicly Held Shares;
(2) A Market Value of Publicly Held Shares of at least $1,000,000;
(3) Minimum bid price of at least $1 per share;
(4) At least 100 Public Holders; and
(5) At least two registered and active Market Makers.
(b) When the Primary Equity Security of the Company is not listed
on [either] the Global Market or is not a Covered Security [another
National Securities Exchange], the preferred stock and/or secondary
class of common stock may continue to be listed on the Global Market so
long as it satisfies the continued listing criteria for Primary Equity
Securities set forth in Rule 5450.
* * * * *
5615. Exemptions From Certain Corporate Governance Requirements
This rule provides the exemptions from the corporate governance
rules afforded to certain types of Companies, and sets forth the phase-
in schedules for initial public offerings, Companies emerging from
bankruptcy and Companies transferring from other markets. This rule
also describes the applicability of the corporate governance rules to
controlled companies and sets forth the phase-in schedule afforded to
Companies ceasing to be controlled companies.
(a) No change.
(1) No change.
IM-5615-1. No change.
(2) No change.
IM-5615-2. No change.
(3) No change.
IM-5615-3. No change.
(4) No change.
(5) Management Investment Companies
Management investment companies (including business development
companies) are subject to all the requirements of the Rule 5600 Series,
except that management investment companies registered under the
Investment Company Act of 1940 are exempt from the [requirements of]
Independent Directors requirement, the Independent Director Oversight
of Executive Officer Compensation and Director Nominations
requirements, and the Code of Conduct [requirements] requirement, set
forth in Rules 5605(b), (d) and (e), and 5610, respectively.
IM-5615-4. Management Investment Companies
Management investment companies registered under the Investment
Company Act of 1940 are already subject to a pervasive system of
federal regulation in certain areas of corporate governance covered by
5600. In light of this, Nasdaq exempts from [Rule] Rules 5605(b), (d),
(e) and 5610 management investment companies registered under the
Investment Company Act of 1940. Business development companies, which
are a type of closed-end management investment company defined in
Section 2(a)(48) of the Investment Company Act of 1940 that are not
registered under that Act, are required to comply with all of the
provisions of the Rule 5600 Series.
(b)-(c) No change.
IM-5615-5. No change.
* * * * *
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, Nasdaq 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. Nasdaq 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 March 12, 2009, Nasdaq filed a proposed rule change to revise
the rules relating to the qualification, listing, and delisting of
companies listed on, or applying to list on, Nasdaq to improve the
organization of the rules, eliminate redundancies and simplify the rule
language.\5\ These new listing rules (the ``Listing Rules'') were
effective April 13, 2009. Nasdaq has observed that the March filing
introduced inadvertent changes in the Listing Rules related to the
Global Market listing requirements for preferred stock and secondary
classes of securities, and to the governance requirements applicable to
management investment companies registered under the Investment Company
Act of 1940.\6\ This filing modifies those rules to revert to the
requirements as they previously existed in the listing rules (the ``Old
Rules''), and to make certain conforming changes.\7\
---------------------------------------------------------------------------
\5\ Securities Exchange Act Release No. 59663 (March 31, 2009),
74 FR 15552 (April 6, 2009) (SR-NASDAQ-2009-018).
\6\ 15 U.S.C. 80-a1 [sic] et seq.
\7\ The text of Nasdaq's prior rules is included in Exhibit 5B
of SR-NASDAQ-2009-018, supra note 5, available at: https://nasdaq.cchwallstreet.com/NASDAQ/pdf/nasdaq-filings/2009/SR-NASDAQ-2009-018.pdf.
---------------------------------------------------------------------------
Nasdaq is proposing technical changes to conform Listing Rule
5415(b) and Listing Rules 5460(a) and (b) with the meaning of Old Rules
4420(k) and 4450(h), respectively, and to make them consistent with
each other and the analogous Capital Market rules. Old Rules 4420(k)
and 4450(h) provided quantitative initial and continued listing
requirements for preferred stock and secondary classes of common stock.
These rules also allowed the application of the respective initial and
continued listing requirements applicable to common stock if the
issuer's common stock or common stock equivalent security was not
listed on either Nasdaq or another national securities exchange. In
adopting Listing Rule 5415(a), Nasdaq replaced the term ``national
securities exchange'' with the newly-defined term ``Covered Security,''
\8\ which was also used in the analogous Capital Market Listing Rules
5510 and 5555. Nasdaq did not, however, make conforming changes to
Listing Rules 5415(b) and 5460 to replace the old term with the new.
Further, in the case of Rule 5415(b), rule text inadvertently omits the
word ``not,'' which is necessary for the rule to retain its meaning. In
the case of Rules 5460(a) and (b), the term ``Covered Security'' was
not used at all. Accordingly, Nasdaq is proposing technical changes to
Listing Rule 5415(b), and Listing Rules 5460(a) and (b) to make them
consistent with each other and Rules 5610 and 5655, the analogous
Capital Market rules.
---------------------------------------------------------------------------
\8\ Listing Rule 5005(a)(9) defines a Covered Security as ``a
security described in Section 18(b) of the Securities Act of 1933.''
---------------------------------------------------------------------------
[[Page 46260]]
Under Old Rule 4350(a)(2) and IM-4350-6, a management investment
company registered under the Investment Company Act of 1940 \9\ was
exempt from Old Rule 4350(c), which contained the requirements for a
company to have a majority independent board, hold executive sessions,
and for independent directors to make certain compensation and
nomination decisions, and Old Rule 4350(n), which contained the code of
conduct requirement. Old Rule 4350(a)(2) was moved to Listing Rule
5615(a)(5) and exempts a registered management investment company from
Listing Rule 5605(b), which contains the requirement for a company to
have a majority independent board and executive sessions, and Listing
Rule 5610, which contains the code of conduct requirement. However, the
part of Old Rule 4350(c) which relates to the requirement for
independent directors to make certain compensation and nomination
decisions was moved to Listing Rules 5605(d) and (e), both of which are
not cross-referenced in Listing Rule 5615(a)(5). As a consequence,
Listing Rule 5615(a)(5) no longer contains the full range of exemptions
that were previously provided under Old Rule 4350(a)(2). Accordingly,
Nasdaq is proposing to amend the cross-reference found in Listing Rule
5615(a)(5) and IM-5615-4 to include Listing Rules 5605(d) and (e), thus
conforming Listing Rule 5615(a)(5) with Old Rule 4350(a)(2). Nasdaq
also proposes to expand the explanation of the cross references in the
rule, consistent with the style of the Listing Rules.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 80-a1 [sic] et seq.
---------------------------------------------------------------------------
2. Statutory Basis
Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\10\ in general and with
Sections 6(b)(5) of the Act,\11\ 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 regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest. The proposed rule change is
designed to revert to the previously approved requirements of certain
listing standards that were inadvertently changed when adopting the new
Listing Rules, and to complete certain conforming changes to the
Listing Rules that were not fully implemented with their adoption.
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78f.
\11\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
Nasdaq does not believe that the proposed rule change will impose
any burden on competition 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 either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
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, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) \12\ of the
Act and Rule 19b-4(f)(6) thereunder.\13\
---------------------------------------------------------------------------
\12\ 15 U.S.C. 78s(b)(3)(A).
\13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to provide the Commission
with 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, or such shorter time as designated by the
Commission. The Exchange has satisfied this requirement.
---------------------------------------------------------------------------
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 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 (https://www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2009-078 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-NASDAQ-2009-078.
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 (https://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 such filing also will 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 No. SR-NASDAQ-2009-078 and should be
submitted on or before September 29, 2009.
For the Commission, by the Division of Trading and Markets, pursuant
to delegated authority.\14\
---------------------------------------------------------------------------
\14\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-21584 Filed 9-4-09; 8:45 am]
BILLING CODE 8010-01-P
