Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change in Connection With the Proposed Acquisition of National Stock Exchange, Inc. by the NYSE Group, Inc., 96128-96133 [2016-31487]
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independence policy, ICE Holdings
bylaws and certificate of incorporation,
NYSE Holdings operating agreement,
and the NYSE Group bylaws and
certificate of incorporation, to reflect the
Acquisition, including updating
corporate names, would contribute to
the orderly operation of the Exchange by
adding clarity and transparency to the
Exchange’s rules and would enable the
Exchange to continue to be so organized
as to have the capacity to carry out the
purposes of the Exchange Act and
comply and enforce compliance with
the provisions of the Exchange Act by
its members and persons associated
with its members. The Exchange
therefore believes that approval of the
amendment to the Bylaws is consistent
with Section 6(b)(1).
For similar reasons, the Exchange also
believes that this filing furthers the
objectives of Section 6(b)(5) of the
Exchange Act 20 because the proposed
rule change would be consistent with
and facilitate would [sic] create a
governance and regulatory structure that
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. As discussed above, the
proposed updates to the corporate
documents and replacement of outdated
or obsolete references removes
impediments to and perfects the
mechanism of a free and open market by
removing confusion that may result
from having these references in the
governing documents following the
Acquisition. The Exchange further
believes that the proposal removes
impediments to and perfects the
mechanism of a free and open market by
ensuring that persons subject to the
Exchange’s jurisdiction, regulators, and
the investing public can more easily
navigate and understand the governing
documents. The Exchange further
believes that eliminating an obsolete
reference would not be inconsistent
with the public interest and the
protection of investors because investors
will not be harmed and in fact would
benefit from increased transparency,
thereby reducing potential confusion.
Removing such obsolete references will
20 15
U.S.C. 78f(b)(5).
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also further the goal of transparency and
add clarity to the Exchange’s rules.
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 Exchange Act.
The proposed rule change is not
intended to address competitive issues
but rather is concerned solely with
updating the Exchange’s rules to reflect
the Acquisition and to remove obsolete
references.
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 45 days of the date of
publication of this notice in the Federal
Register or up to 90 days (i) as the
Commission may designate 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 or disapprove
the proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be disapproved.
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 Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
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 Number SR–NYSE–
2016–90 and should be submitted on or
before January 19, 2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016–31483 Filed 12–28–16; 8:45 am]
BILLING CODE 8011–01–P
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 email to rule-comments@
sec.gov. Please include File Number SR–
NYSE–2016–90 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSE–2016–90. This file
number should be included on the
subject line if email is used. To help the
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79675; File No. SR–
NYSEMKT–2016–122]
Self-Regulatory Organizations; NYSE
MKT LLC; Notice of Filing of Proposed
Rule Change in Connection With the
Proposed Acquisition of National
Stock Exchange, Inc. by the NYSE
Group, Inc.
December 22, 2016.
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 December
16, 2016, NYSE MKT LLC (the
‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with
the Securities and Exchange
21 17
CFR 200.30–3(a)(12).
U.S.C.78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b-4.
1 15
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Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I and II 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes in connection
with the proposed acquisition of
National Stock Exchange, Inc. (‘‘NSX’’)
by the Exchange’s parent the NYSE
Group, Inc. (‘‘NYSE Group’’), to amend
certain organizational documents of
NYSE Group, NYSE Holdings LLC
(‘‘NYSE Holdings’’), Intercontinental
Exchange Holdings, Inc. (‘‘ICE
Holdings’’), and Intercontinental
Exchange, Inc. (‘‘ICE’’). The proposed
rule change is available on the
Exchange’s Web site at www.nyse.com,
at the principal office of the Exchange,
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,
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
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1. Purpose
Background
On December 14, 2016, ICE entered
into an agreement with the NSX
pursuant to which its wholly-owned
subsidiary NYSE Group would acquire
all of the outstanding capital stock of
the NSX (the ‘‘Acquisition’’). As a result
of the Acquisition, the NSX would be
renamed NYSE National, Inc. (‘‘NYSE
National’’) and would be operated as a
wholly-owned subsidiary of NYSE
Group. NYSE Group is a wholly-owned
subsidiary of NYSE Holdings, which is
in turn 100% owned by ICE Holdings.
ICE, a public company listed on the
New York Stock Exchange LLC (the
‘‘NYSE’’), owns 100% of ICE Holdings.
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Following the Acquisition, NYSE
National would continue to be
registered as a national securities
exchange and as a separate selfregulatory organization (‘‘SRO’’). As
such, NYSE National would continue to
have separate rules, membership rosters,
and listings that would be distinct from
the rules, membership rosters, and
listings of the three other registered
national securities exchanges and SROs
owned by NYSE Group, namely, the
Exchange, the NYSE, and NYSE Arca,
Inc. (‘‘NYSE Arca’’) (together, the
‘‘NYSE Exchanges’’).4
In connection with the Acquisition
and as discussed more fully below, the
following organizational documents of
NYSE Group and its intermediary and
ultimate parent entities would be
amended:
• ICE bylaws and director
independence policy,
• ICE Holdings bylaws and certificate
of incorporation,
• NYSE Holdings operating
agreement, and
• NYSE Group bylaws and certificate
of incorporation.
These proposed changes would
consist of technical and conforming
amendments to reflect the proposed
new ownership of NYSE National by the
NYSE Group, and, indirectly, ICE.5
The proposed rule changes would be
effected following approval of this rule
filing no later than February 28, 2017,
on a date determined by its Board.
Proposed Rule Change
The Exchange proposes that, in
connection with the Acquisition, the
Commission approve the organizational
documents of ICE and its wholly-owned
subsidiaries ICE Holdings and NYSE
Group and the Independence Policy of
the Board of Directors of
Intercontinental Exchange, Inc. (‘‘ICE
Independence Policy’’), all of which are
to be amended concurrently with the
Acquisition to reflect ownership of
NYSE National.
The current organizational documents
of ICE and its wholly-owned
subsidiaries provide certain protections
to the NYSE Exchanges that are
designed to protect and facilitate their
self-regulatory functions, including
certain restrictions on the ability to vote
and own shares of ICE.6 In general, the
4 The NYSE Exchanges are referred to as the U.S.
Regulated Subsidiaries in the corporate documents
proposed to be amended in this rule filing.
5 The proposed revisions are also discussed in the
NYSE and NYSE Arca companion rule filings
related to the Acquisition. See SR–NYSE–2016–90
& SR–NYSEArca–2016–167.
6 See Securities Exchange Release No. 70210
(August 15, 2013), 78 FR 51758 (August 21, 2013)
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96129
organizational documents of ICE and its
wholly-owned subsidiaries are being
amended to provide similar protections
to the NYSE National as are currently
provided to the NYSE Exchanges under
those documents.
In addition, obsolete references to
NYSE Market (DE), Inc. (formerly NYSE
Market, Inc.) (‘‘NYSE Market (DE)’’), and
NYSE Regulation, Inc. (‘‘NYSE
Regulation’’) found in various
documents are proposed to be deleted.7
Proposed Seventh Amended and
Restated Bylaws of Intercontinental
Exchange, Inc. (‘‘ICE Bylaws’’)
The ICE Bylaws would be amended to
reflect the Acquisition and incorporate
NYSE National in the ICE Bylaws’
existing voting and ownership
restrictions, provisions relating to the
qualifications of directors and officers
and their submission to jurisdiction,
compliance with the federal securities
laws, access to books and records, and
other matters related to its control of the
U.S. Regulated Subsidiaries.
Specifically, the ICE Bylaws would be
amended as follows:
• The definition of ‘‘U.S. Regulated
Subsidiaries’’ in Article III, Section 3.15,
which currently includes the NYSE,
NYSE Market (DE), NYSE Regulation,
NYSE Arca, LLC, NYSE Arca, NYSE
Arca Equities, Inc. (‘‘NYSE Arca
Equities’’), and NYSE MKT, would be
amended to include NYSE National.
The obsolete references to NYSE Market
(DE) and NYSE Regulation would also
be deleted.
• Article VIII (Confidential
Information), Section 8.1, would be
amended to extend to NYSE National
the same protection regarding
confidential information provided to the
NYSE Exchanges and NYSE Arca
Equities, and to remove the obsolete
references to NYSE Market (DE) and
NYSE Regulation.
• Article XI, Section 11.3, provides
that, for so long as ICE controls any of
the U.S. Regulated Subsidiaries, any
amendment to or repeal of the ICE
Bylaws must either be (i) filed with or
filed with and approved by the
Commission under Section 19 of the
(approving rule changes related to NYSE Euronext
becoming a wholly owned subsidiary of ICE (then
called IntercontinentalExchange Group, Inc.)).
7 NYSE Market (DE) and NYSE Regulation were
previously parties to a Delegation Agreement
whereby the NYSE delegated certain regulatory
functions to NYSE Regulation and certain market
functions to NYSE Market (DE). The Delegation
Agreement was terminated when the NYSE reintegrated its regulatory and market functions. As
a result, the two entities ceased being regulated
subsidiaries. See Securities Exchange Act Release
No. 75991 (September 28, 2015), 80 FR 59837
(October 2, 2015). NYSE Regulation has since been
merged out of existence.
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Exchange Act and the rules promulgated
thereunder, or (ii) submitted to the
boards of directors of the U.S. Regulated
Subsidiaries or the boards of directors of
their successors, in each case only to the
extent that such entity continues to be
controlled directly or indirectly by ICE.
Section 11.3 would be amended to
include the NYSE National, and to
delete the obsolete references to NYSE
Market (DE) and NYSE Regulation.
The ICE Bylaws would be further
amended to add a new Article XII
(Voting and Ownership Limitations).
New Section 12.1.a of Article XII would
provide that, subject to its fiduciary
obligations under applicable law, for so
long as ICE directly or indirectly
controls NYSE National (or its
successor), the board of directors of ICE
shall not adopt any resolution pursuant
to clause (b) of Section A.2 of Article V
of the certificate of incorporation of ICE
(which relates to ICE board of directors
approval of ownership of ICE capital
stock by a person together with its
related persons in excess of 20%),
unless the board of directors of ICE shall
have determined that:
• In the case of a resolution to
approve the exercise of voting rights in
excess of 20% of the then outstanding
votes entitled to be cast on such matter,
neither such person nor any of its
related persons is an ETP Holder of
NYSE National;
• in the case of a resolution to
approve the entering into of an
agreement, plan or other arrangement
under circumstances that would result
in shares of stock of ICE that would be
subject to such agreement, plan or other
arrangement not being voted on any
matter, or the withholding of any proxy
relating thereto, where the effect of such
agreement, plan or other arrangement
would be to enable any person, but for
Article V of the Certificate of
Incorporation of ICE, either alone or
together with its related persons, to
vote, possess the right to vote or cause
the voting of shares of stock of ICE that
would exceed 20% of the then
outstanding votes entitled to be cast on
such matter neither such person nor any
of its related persons is, with respect to
NYSE National, an ETP Holder.
New Section 12.1.b would provide
that, subject to its fiduciary obligations
under applicable law, for so long as ICE
directly or indirectly controls NYSE
National (or its successor), the Board of
Directors of ICE shall not adopt any
resolution pursuant to clause (b) of
Section B(2) of Article V of ICE’s
Certificate of Incorporation, unless the
Board of Directors shall have
determined that neither such person nor
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any of its related persons is an ETP
Holder.
New Section 12.2 would provide that,
for so long as ICE shall control, directly
or indirectly, NYSE National (or its
successor), the ICE board of directors
shall not adopt any resolution to repeal
or amend any provision of the certificate
of incorporation of ICE unless such
amendment or repeal shall either be (a)
filed with or filed with and approved by
the SEC under Section 19 of the
Exchange Act and the rules promulgated
thereunder or (b) submitted to the board
of directors of NYSE National (or the
board of directors of its successor), and
if such board of directors determines
that such amendment or repeal must be
filed with or filed with and approved by
the Commission under Section 19 of the
Exchange Act and the rules promulgated
thereunder before such amendment or
repeal may be effectuated, then such
amendment or repeal shall not be
effectuated until filed with or filed with
and approved by the Commission, as the
case may be.
Proposed Eighth Amended and Restated
Certificate of Incorporation of
Intercontinental Exchange Holdings,
Inc. (‘‘ICE Holdings Certificate of
Incorporation’’)
The ICE Holdings Certificate of
Incorporation is being amended as
follows:
• On the first page, add ‘‘Eighth’’ and
delete ‘‘Seventh’’ before ‘‘Amended and
Restated Certificate of Incorporation’’ in
the heading and update items (2)–(5)
accordingly to reflect that this would be
the eighth amendment and restatement
including replacing an incorrect
reference to ‘‘Sixth’’ before ‘‘Amended’’
in item (3). The date would also be
updated in the preamble on the first
page.
• To distinguish between the ETP
Holders of NYSE Arca Equities and
those of NYSE National, subsection
A.3.c.ii of Article V (Limitations on
Voting and Ownership) would be
amended to define an ETP Holder of
NYSE Arca Equities as an ‘‘NYSE Arca
Equities ETP Holder.’’ Obsolete
references to NYSE Market (DE) and
NYSE Regulation, would also be
deleted.8
Subsection A.3.c of Article V would
be amended to add a new subsection (v),
similar to those in place for the other
NYSE Exchanges, which would provide
that for so long as the ICE Holdings
directly or indirectly controls NYSE
National (or its successor), no person
nor any of its related persons (as those
terms are defined therein) is an ETP
8 See
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Holder (as proposed to be defined in the
bylaws of NYSE National, discussed
above) of NYSE National.
• Subsection A.3.d of Article V would
be amended to add ‘‘NYSE Arca’’ before
‘‘ETP Holder’’ in one place to
distinguish between the NYSE Arca
Equities ETP Holders of and those of
NYSE National.
Subsection (A)(3)(d) would be further
amended to add a new subsection (v)
similar to those in place for the other
NYSE Exchanges. The new subsection
would incorporate NYSE National into
the existing restriction, such that the
ICE Holdings Board of Directors would
be restricted from adopting a resolution
to approve the exercise of voting rights
that would exceed 20% of the then
outstanding votes entitled to be cast on
such matter, where neither such person
nor any of its related persons is, with
respect to NYSE National, an NYSE
National ETP Holder.
• Subsection B.3 of Article V would
be amended to add a new subsection (g)
similar to those in place for the other
NYSE Exchanges, incorporating NYSE
National into the restriction on the ICE
Holdings board of directors adopting
any resolution pursuant to clause (b) of
Section B.2 of Article V of the ICE
Holdings Certificate of Incorporation
(which relates to ICE board of directors
approval of ownership of ICE capital
stock by a person together with its
related persons in excess of 20%) unless
the NYSE Holdings board of directors
determines that, for so long as ICE
Holdings controls NYSE National,
neither such person nor any of its
related persons is an NYSE National
ETP Holder.
Proposed Fifth Amended and Restated
Bylaws of Intercontinental Exchange
Holdings, Inc. (‘‘ICE Holdings Bylaws’’)
The ICE Holdings Bylaws are being
amended as follows:
• The cover page and heading on the
first page would be amended to add
‘‘Fifth’’ and delete ‘‘Fourth’’ before
‘‘Amended and Restated Bylaws’’ to
reflect that this would be the fifth
amendment and restatement. The
effective date on the cover page would
also be updated.
• Similar to the ICE Bylaws discussed
above, the ICE Holdings Bylaws would
be amended to include ‘‘NYSE National,
Inc.’’ in:
• The definition of ‘‘U.S. Regulated
Subsidiaries’’ in Article III, Section 3.15,
which currently includes the NYSE,
NYSE Market (DE), NYSE Regulation,
NYSE Arca, LLC, NYSE Arca, NYSE
Arca Equities, and the Exchange, and to
provide that the term ‘‘U.S. Regulated
Subsidiaries’’ includes those entities
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listed or their successors, but only so
long as they continue to be controlled,
directly or indirectly, by ICE Holdings.
Obsolete references to NYSE Market
(DE) and NYSE Regulation in that
section would also be deleted; 9
• Article VIII (Confidential
Information), Section 8.1, which would
be amended to extend the same
protection to confidential information
relating to the self-regulatory function of
NYSE National or its successor; 10 and
• Article XI (Amendment to the
Bylaws), Section 11.3, which provides
that, for so long as ICE controls any of
the U.S. Regulated Subsidiaries, any
amendment to or repeal of the ICE
Bylaws must either be (i) filed with or
filed with and approved by the
Commission under section 19 of the
Exchange Act and the rules promulgated
thereunder, or (ii) submitted to the
boards of directors of the U.S. Regulated
Subsidiaries or the boards of directors of
their successors, in each case only to the
extent that such entity continues to be
controlled directly or indirectly by ICE
Holdings. Obsolete references to NYSE
Market (DE) and NYSE Regulation
would also be deleted from Article VXI,
Section 11.3.11
Proposed Independence Policy of the
Board of Directors of Intercontinental
Exchange, Inc. (‘‘ICE Director
Independence Policy’’)
The ICE Director Independence Policy
would be amended to add NYSE
National to the section describing
‘‘Independence Qualifications.’’ In
particular, NYSE National would be
added to categories (1)(b) and (c) that
refer to ‘‘members,’’ as defined in
section 3(a)(3)(A)(i), 3(a)(3)(A)(ii),
3(a)(3)(A)(iii) and 3(a)(3)(A)(iv) of the
Exchange Act.12 The clause ‘‘and
‘Person Associated with an ETP Holder’
(as defined in Rule 1.5 of NYSE
National, Inc.)’’ would also be added to
category (1)(b) in reference to ‘‘allied
persons.’’ NYSE National would also be
added to subsections (4) and (5) of the
‘‘Independence Qualifications’’
section.13 Obsolete references to NYSE
Market (DE) and NYSE Regulation
would also be deleted.14
9 See
note 7, supra.
VIII, Section 8.1 would also be amended
to delete obsolete references to NYSE Market (DE)
and NYSE Regulation.
11 See note 7, supra. Conforming changes to
delete and replace connectors would also be made
throughout.
12 See 15 U.S.C. 78c(a)(3)(a).
13 Conforming changes would also be made to
delete and replace connectors. The link in footnote
2 to the NYSE Listed Company Manual and
commentary would also be updated.
14 See note 7, supra.
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Proposed Eighth Amended and Restated
Limited Liability Company Agreement
of NYSE Holdings LLC (‘‘NYSE
Holdings LLC Operating Agreement’’)
The NYSE Holdings LLC Operating
Agreement would be amended as
follows:
• The heading and preamble would
be amended to add ‘‘Eighth’’ and delete
‘‘Seventh’’ before ‘‘Amended and
Restated Limited Liability Agreement’’
to reflect that this would be the eighth
amendment and restatement. The
effective date would also be updated.
After ‘‘This Agreement amends and
restates in its entirety that’’ in the
second full sentence would be added
the clause ‘‘certain Seventh Amended
and Restated Limited Liability Company
Agreement, dated as of May 22, 2015,
which amended and restated in its
entirety that.’’
• The current penultimate whereas
clause would be amended by adding ‘‘in
May 2015’’ before ‘‘the Company’’ and
‘‘now desires to amend and restate’’
immediately following would be
replaced with ‘‘amended and restated.’’
‘‘Had’’ and ‘‘are’’ would be changed to
the past tense ‘‘had’’ [sic] and ‘‘were’’ in
the final sentence.
• The following new whereas clause
would be added immediately above the
current last whereas clause:
‘‘WHEREAS, the Company now desires
to amend and restate the Seventh
Amended and Restated Agreement to
reflect the acquisition of NYSE National,
Inc. by the Company’s wholly-owned
subsidiary NYSE Group, Inc.;’’.
• The definition of ETP Holder in
Article I (Interpretation), Section 1.1
would be deleted and new definitions of
an NYSE Arca ETP Holder and NYSE
National ETP Holder would be added.
The obsolete definition of NYSE Market
(DE) would be deleted.15
• Article IX (Voting and Ownership
Limitations), Section 9.1(a)(3)(C) would
be amended to add ‘‘NYSE Arca’’ before
‘‘ETP Holder’’ and the defined term
‘‘NYSE Arca ETP Holder’’ to distinguish
between the ETP Holders of NYSE Arca
Equities and those of NYSE National.
An obsolete reference to NYSE Market
(DE) would also be deleted from Section
9.1(a)(3)(C).16
Section 9.1(a)(3)(C) would be
amended to add a new subsection (v)
similar to those in place for the other
NYSE Exchanges. The new subsection
(v) would incorporate NYSE National
into the existing restriction, such that
the ICE Holdings board of directors
15 See
note 7, supra.
note 7, supra. Conforming changes to
delete and replace connectors would also be made
throughout.
16 See
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96131
would be restricted from adopting a
resolution pursuant to clause (b) of
Section 9.1(a)(2) unless the NYSE
Holdings board of directors determines
that, for so long as NYSE Holdings
directly or indirectly controls NYSE
National, Inc. (or its successor), neither
such person nor any of its related
persons is an ETP Holder (as defined in
the bylaws of NYSE National, as such
bylaws may be in effect from time to
time) of NYSE National (‘‘NYSE
National ETP Holder’’). The clause
would also provide that any such
person that is a related person of an ETP
Holder shall hereinafter also be deemed
to be an ‘‘NYSE National ETP Holder’’
for purposes of the agreement, as the
context may require.
• Article IX, Section 9.1(a)(3)(D)
would be amended to add ‘‘NYSE Arca’’
before ‘‘ETP Holder.’’ An outdated
reference to NYSE Market (DE) would
also be deleted.
Further, a new clause (v) would be
added to Section 9.1(a)(3)(D) to
incorporate NYSE National into the
existing restriction on the NYSE
Holdings Board of Directors, such that it
would be restricted from adopting a
resolution to approve the exercise of
voting rights that would exceed 20% of
the then outstanding votes entitled to be
cast on such matter for so long as NYSE
Holdings controls NYSE National. The
clause would provide that ‘‘for so long
as the Corporation directly or indirectly
controls NYSE National, neither such
person nor any of its Related Persons is
an NYSE National ETP Holder.’’
• Article IX, Section 9.1(b)(3) of
Article IX [sic] would be amended to
add a new subpart (G) to incorporate
NYSE National into the existing
restriction on the NYSE Holdings Board
of Directors, so that it would provide
that, subject to its fiduciary obligations
under applicable law, for so long as
NYSE Holdings directly or indirectly
controls NYSE National (or its
successor), the board of directors of
NYSE Holdings shall not adopt any
resolution pursuant to (b) of Section
9.1(b)(2) of the NYSE Holdings LLC
Operating Agreement, unless the board
of directors of NYSE Holdings shall
have determined that neither such
person nor any of its related persons is
an NYSE National ETP Holder.
Proposed Fifth Amended and Restated
Certificate of Incorporation of NYSE
Group, Inc. (‘‘NYSE Group Certificate of
Incorporation’’)
The NYSE Group Certificate of
Incorporation is being amended as
follows:
• On the first page, add ‘‘Fifth’’ and
delete ‘‘Fourth’’ before ‘‘Amended and
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Restated Certificate of Incorporation’’ in
the heading. The Recitations would be
amended to reflect that this would be
the fifth amendment and restatement.
First, the Fifth Recitation would be
updated to reflect that a Fourth
Amended and Restated Certificate of
Incorporation was filed with the
Secretary of State of the State of
Delaware on December 29, 2014. A new
Sixth Recitation would be updated to
reflect that the Fifth Amended and
Restated Certificate of Incorporation has
been duly adopted. The current Sixth
Recitation would become the Seventh
and would reflect that the Fourth
Amended and Restated Certificate of
Incorporation is amended and restated
in its entirety.
• NYSE National would be added to
the list of ‘‘Regulated Subsidiaries’’ in
Article 4 (Stock), Section 4(b)(1), which
currently includes the NYSE, NYSE
Market (DE), NYSE Regulation, NYSE
Arca, LLC, NYSE Arca Equities, and
NYSE MKT, and the obsolete references
to NYSE Market (DE) and NYSE
Regulation would be deleted.
• To distinguish between the ETP
Holders of NYSE Arca Equities and
those of NYSE National, Section
4(b)(1)(y) of Article IV would be
amended to define an ETP Holder of
NYSE Arca Equities as an ‘‘NYSE Arca
Equities ETP Holder.’’ An outdated
reference to NYSE Market (DE) would
also be deleted.
Section 4(b)(1)(y) would also be
amended to add a provision to [sic]
similar to those in place for the other
NYSE Exchanges providing that, for so
long as NYSE Group directly or
indirectly controls NYSE National (or its
successor), neither such person nor any
of its related persons is an ETP Holder
(as defined in the rules of NYSE
National, as such rules may be in effect
from time to time) of NYSE National
(defined as an ‘‘NYSE National ETP
Holder’’) and that any such person that
is a related person of an NYSE National
ETP Holder shall hereinafter also be
deemed to be an ‘‘NYSE National ETP
Holder’’ for purposes of the certificate of
incorporation, as the context may
require.
• Further, subsection 4(b)(1)(z) of
Article IV would be amended to define
an ETP Holder of NYSE Arca Equities as
an ‘‘NYSE Arca Equities ETP Holder’’
and delete an outdated reference to
NYSE Market (DE). Subsection 4(b)(1)(z)
would also be amended to incorporate
NYSE National into the existing
restriction on the ICE Holdings Board of
Directors, such that it would be
restricted from adopting a resolution to
approve the exercise of voting rights
that would exceed 20% of the then
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outstanding votes entitled to be cast on
such matter, where neither such person
nor any of its related persons is, with
respect to NYSE National, an NYSE
National ETP Holder.
• A new subpart (vii) would be added
to subsection 4(b)(2)(C) of Article IV to
incorporate NYSE National into the
existing restriction on the NYSE Group
Board of Directors, such that it would be
restricted from adopting a resolution to
approve the exercise of voting rights
that would exceed 20% of the then
outstanding votes entitled to be cast on
such matter, where neither such person
nor any of its related persons is, with
respect to NYSE National, an NYSE
National ETP Holder.17
• Article X (Confidential Information)
would be amended to extend the same
protection to confidential information
relating to the self-regulatory function of
NYSE National or its successor and
delete obsolete references to NYSE
Market (DE) and NYSE Regulation.
• Article XII (Amendments to
Certificate of Incorporation) provides
that, for so long as NYSE Group controls
the Regulated Subsidiaries, before any
amendment or repeal of any provision
of the Certificate of Incorporation shall
be effective, such amendment or repeal
shall either (a) be filed with or filed
with and approved by the SEC under
Section 19 of the Exchange Act and the
rules promulgated thereunder or (b) be
submitted to the boards of directors of
NYSE, NYSE Market (DE), NYSE
Regulation, NYSE Arca, NYSE Arca
Equities, and NYSE MKT or the boards
of directors of their successors. Article
XII would be amended to add NYSE
National to subsection (b) and delete
references to NYSE Market (DE) and
NYSE Regulation.
Proposed Third Amended and Restated
Bylaws of NYSE Group, Inc. (‘‘NYSE
Group Bylaws’’)
The NYSE Group Bylaws are being
amended as follows:
• Add ‘‘Third’’ and delete ‘‘Second’’
before ‘‘Amended and Restated Bylaws’’
in the heading to reflect that this would
be the third amendment and
restatement.
• Article VII (Miscellaneous), Section
7.9(A)(b) currently provides that, for so
long as NYSE Group controls any of the
NYSE Exchanges, any amendment to or
repeal of the ICE Bylaws must either be
(i) filed with or filed with and approved
by the Commission under section 19 of
the Exchange Act and the rules
promulgated thereunder, or (ii)
submitted to the boards of directors of
the NYSE, NYSE Market (DE), NYSE
Regulation, NYSE Arca, NYSE Arca
Equities, and NYSE Alternext US LLC or
the boards of directors of their
successors, in each case only to the
extent that such entity continues to be
controlled directly or indirectly by ICE.
Section 7.9(A)(b) would be amended to
delete obsolete references to NYSE
Market (DE) and NYSE Regulation,
replace the outdated reference to ‘‘NYSE
Alternext US LLC’’ with ‘‘NYSE MKT
LLC,’’ and add NYSE National.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Exchange Act 18 in
general, and with Section 6(b)(1) 19 in
particular, in that it enables the
Exchange to be so organized as to have
the capacity to be able to carry out the
purposes of the Exchange Act and to
comply, and to enforce compliance by
its exchange members and persons
associated with its exchange members,
with the provisions of the Exchange Act,
the rules and regulations thereunder,
and the rules of the Exchange. The
Exchange believes that the proposed
changes to the corporate documents of
the NYSE Group and its intermediary
and ultimate parent entities, including
the ICE bylaws and director
independence policy, ICE Holdings
bylaws and certificate of incorporation,
NYSE Holdings operating agreement,
and the NYSE Group bylaws and
certificate of incorporation, to reflect the
Acquisition, including updating
corporate names, would contribute to
the orderly operation of the Exchange by
adding clarity and transparency to the
Exchange’s rules and would enable the
Exchange to continue to be so organized
as to have the capacity to carry out the
purposes of the Exchange Act and
comply and enforce compliance with
the provisions of the Exchange Act by
its members and persons associated
with its members. The Exchange
therefore believes that approval of the
amendment to the Bylaws is consistent
with Section 6(b)(1).
For similar reasons, the Exchange also
believes that this filing furthers the
objectives of Section 6(b)(5) of the
Exchange Act 20 because the proposed
rule change would be consistent with
and facilitate [sic] would create a
governance and regulatory structure that
is designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
18 15
17 An
obsolete reference to NYSE Market (DE)
would also be deleted from Article IV, 4(b)(2)(C)(v).
PO 00000
Frm 00177
Fmt 4703
Sfmt 4703
U.S.C. 78f(b).
U.S.C. 78f(b)(1).
20 15 U.S.C. 78f(b)(5).
19 15
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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. As discussed above, the
proposed updates to the corporate
documents and replacement of outdated
or obsolete references removes
impediments to and perfects the
mechanism of a free and open market by
removing confusion that may result
from having these references in the
governing documents following the
Acquisition. The Exchange further
believes that the proposal removes
impediments to and perfects the
mechanism of a free and open market by
ensuring that persons subject to the
Exchange’s jurisdiction, regulators, and
the investing public can more easily
navigate and understand the governing
documents. The Exchange further
believes that eliminating an obsolete
reference would not be inconsistent
with the public interest and the
protection of investors because investors
will not be harmed and in fact would
benefit from increased transparency,
thereby reducing potential confusion.
Removing such obsolete references will
also further the goal of transparency and
add clarity to the Exchange’s rules.
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 Exchange Act.
The proposed rule change is not
intended to address competitive issues
but rather is concerned solely with
updating the Exchange’s rules to reflect
the Acquisition and to remove obsolete
references.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
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 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days (i) as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or (ii) as to which
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96133
NYSEMKT–2016–122 and should be
submitted on or before January 19, 2017.
the self-regulatory organization
consents, the Commission will:
(A) By order approve or disapprove
such proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be disapproved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Eduardo A. Aleman,
Assistant Secretary.
IV. Solicitation of Comments
[FR Doc. 2016–31487 Filed 12–28–16; 8:45 am]
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 email to rule-comments@
sec.gov. Please include File Number SR–
NYSEMKT–2016–122 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEMKT–2016–122. This
file number should be included on the
subject line if email 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 Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
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 Number SR–
PO 00000
Frm 00178
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BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79666; File No. SR–MIAX–
2016–47]
Self-Regulatory Organizations; Miami
International Securities Exchange LLC;
Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change To Amend Its Fee Schedule To
Modify the Exchange’s Connectivity
Fees
December 22, 2016
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 December
13, 2016, Miami International Securities
Exchange LLC (‘‘MIAX’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I, II, and III below, which Items
have been prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is filing a proposal to
amend the MIAX Options Fee Schedule
(the ‘‘Fee Schedule’’) to modify the
Exchange’s connectivity fees.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://www.miaxoptions.com/filter/
wotitle/rule_filing, at MIAX’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
Exchange 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
21 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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]]>Agencies
[Federal Register Volume 81, Number 250 (Thursday, December 29, 2016)]
[Notices]
[Pages 96128-96133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-31487]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-79675; File No. SR-NYSEMKT-2016-122]
Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of
Proposed Rule Change in Connection With the Proposed Acquisition of
National Stock Exchange, Inc. by the NYSE Group, Inc.
December 22, 2016.
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 December 16, 2016, NYSE MKT LLC (the ``Exchange'' or
``NYSE MKT'') filed with the Securities and Exchange
[[Page 96129]]
Commission (the ``Commission'') the proposed rule change as described
in Items I and II 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C.78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes in connection with the proposed acquisition
of National Stock Exchange, Inc. (``NSX'') by the Exchange's parent the
NYSE Group, Inc. (``NYSE Group''), to amend certain organizational
documents of NYSE Group, NYSE Holdings LLC (``NYSE Holdings''),
Intercontinental Exchange Holdings, Inc. (``ICE Holdings''), and
Intercontinental Exchange, Inc. (``ICE''). The proposed rule change is
available on the Exchange's Web site at www.nyse.com, at the principal
office of the Exchange, 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, 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
Background
On December 14, 2016, ICE entered into an agreement with the NSX
pursuant to which its wholly-owned subsidiary NYSE Group would acquire
all of the outstanding capital stock of the NSX (the ``Acquisition'').
As a result of the Acquisition, the NSX would be renamed NYSE National,
Inc. (``NYSE National'') and would be operated as a wholly-owned
subsidiary of NYSE Group. NYSE Group is a wholly-owned subsidiary of
NYSE Holdings, which is in turn 100% owned by ICE Holdings. ICE, a
public company listed on the New York Stock Exchange LLC (the
``NYSE''), owns 100% of ICE Holdings.
Following the Acquisition, NYSE National would continue to be
registered as a national securities exchange and as a separate self-
regulatory organization (``SRO''). As such, NYSE National would
continue to have separate rules, membership rosters, and listings that
would be distinct from the rules, membership rosters, and listings of
the three other registered national securities exchanges and SROs owned
by NYSE Group, namely, the Exchange, the NYSE, and NYSE Arca, Inc.
(``NYSE Arca'') (together, the ``NYSE Exchanges'').\4\
---------------------------------------------------------------------------
\4\ The NYSE Exchanges are referred to as the U.S. Regulated
Subsidiaries in the corporate documents proposed to be amended in
this rule filing.
---------------------------------------------------------------------------
In connection with the Acquisition and as discussed more fully
below, the following organizational documents of NYSE Group and its
intermediary and ultimate parent entities would be amended:
ICE bylaws and director independence policy,
ICE Holdings bylaws and certificate of incorporation,
NYSE Holdings operating agreement, and
NYSE Group bylaws and certificate of incorporation.
These proposed changes would consist of technical and conforming
amendments to reflect the proposed new ownership of NYSE National by
the NYSE Group, and, indirectly, ICE.\5\
---------------------------------------------------------------------------
\5\ The proposed revisions are also discussed in the NYSE and
NYSE Arca companion rule filings related to the Acquisition. See SR-
NYSE-2016-90 & SR-NYSEArca-2016-167.
---------------------------------------------------------------------------
The proposed rule changes would be effected following approval of
this rule filing no later than February 28, 2017, on a date determined
by its Board.
Proposed Rule Change
The Exchange proposes that, in connection with the Acquisition, the
Commission approve the organizational documents of ICE and its wholly-
owned subsidiaries ICE Holdings and NYSE Group and the Independence
Policy of the Board of Directors of Intercontinental Exchange, Inc.
(``ICE Independence Policy''), all of which are to be amended
concurrently with the Acquisition to reflect ownership of NYSE
National.
The current organizational documents of ICE and its wholly-owned
subsidiaries provide certain protections to the NYSE Exchanges that are
designed to protect and facilitate their self-regulatory functions,
including certain restrictions on the ability to vote and own shares of
ICE.\6\ In general, the organizational documents of ICE and its wholly-
owned subsidiaries are being amended to provide similar protections to
the NYSE National as are currently provided to the NYSE Exchanges under
those documents.
---------------------------------------------------------------------------
\6\ See Securities Exchange Release No. 70210 (August 15, 2013),
78 FR 51758 (August 21, 2013) (approving rule changes related to
NYSE Euronext becoming a wholly owned subsidiary of ICE (then called
IntercontinentalExchange Group, Inc.)).
---------------------------------------------------------------------------
In addition, obsolete references to NYSE Market (DE), Inc.
(formerly NYSE Market, Inc.) (``NYSE Market (DE)''), and NYSE
Regulation, Inc. (``NYSE Regulation'') found in various documents are
proposed to be deleted.\7\
---------------------------------------------------------------------------
\7\ NYSE Market (DE) and NYSE Regulation were previously parties
to a Delegation Agreement whereby the NYSE delegated certain
regulatory functions to NYSE Regulation and certain market functions
to NYSE Market (DE). The Delegation Agreement was terminated when
the NYSE re-integrated its regulatory and market functions. As a
result, the two entities ceased being regulated subsidiaries. See
Securities Exchange Act Release No. 75991 (September 28, 2015), 80
FR 59837 (October 2, 2015). NYSE Regulation has since been merged
out of existence.
---------------------------------------------------------------------------
Proposed Seventh Amended and Restated Bylaws of Intercontinental
Exchange, Inc. (``ICE Bylaws'')
The ICE Bylaws would be amended to reflect the Acquisition and
incorporate NYSE National in the ICE Bylaws' existing voting and
ownership restrictions, provisions relating to the qualifications of
directors and officers and their submission to jurisdiction, compliance
with the federal securities laws, access to books and records, and
other matters related to its control of the U.S. Regulated
Subsidiaries.
Specifically, the ICE Bylaws would be amended as follows:
The definition of ``U.S. Regulated Subsidiaries'' in
Article III, Section 3.15, which currently includes the NYSE, NYSE
Market (DE), NYSE Regulation, NYSE Arca, LLC, NYSE Arca, NYSE Arca
Equities, Inc. (``NYSE Arca Equities''), and NYSE MKT, would be amended
to include NYSE National. The obsolete references to NYSE Market (DE)
and NYSE Regulation would also be deleted.
Article VIII (Confidential Information), Section 8.1,
would be amended to extend to NYSE National the same protection
regarding confidential information provided to the NYSE Exchanges and
NYSE Arca Equities, and to remove the obsolete references to NYSE
Market (DE) and NYSE Regulation.
Article XI, Section 11.3, provides that, for so long as
ICE controls any of the U.S. Regulated Subsidiaries, any amendment to
or repeal of the ICE Bylaws must either be (i) filed with or filed with
and approved by the Commission under Section 19 of the
[[Page 96130]]
Exchange Act and the rules promulgated thereunder, or (ii) submitted to
the boards of directors of the U.S. Regulated Subsidiaries or the
boards of directors of their successors, in each case only to the
extent that such entity continues to be controlled directly or
indirectly by ICE. Section 11.3 would be amended to include the NYSE
National, and to delete the obsolete references to NYSE Market (DE) and
NYSE Regulation.
The ICE Bylaws would be further amended to add a new Article XII
(Voting and Ownership Limitations). New Section 12.1.a of Article XII
would provide that, subject to its fiduciary obligations under
applicable law, for so long as ICE directly or indirectly controls NYSE
National (or its successor), the board of directors of ICE shall not
adopt any resolution pursuant to clause (b) of Section A.2 of Article V
of the certificate of incorporation of ICE (which relates to ICE board
of directors approval of ownership of ICE capital stock by a person
together with its related persons in excess of 20%), unless the board
of directors of ICE shall have determined that:
In the case of a resolution to approve the exercise of
voting rights in excess of 20% of the then outstanding votes entitled
to be cast on such matter, neither such person nor any of its related
persons is an ETP Holder of NYSE National;
in the case of a resolution to approve the entering into
of an agreement, plan or other arrangement under circumstances that
would result in shares of stock of ICE that would be subject to such
agreement, plan or other arrangement not being voted on any matter, or
the withholding of any proxy relating thereto, where the effect of such
agreement, plan or other arrangement would be to enable any person, but
for Article V of the Certificate of Incorporation of ICE, either alone
or together with its related persons, to vote, possess the right to
vote or cause the voting of shares of stock of ICE that would exceed
20% of the then outstanding votes entitled to be cast on such matter
neither such person nor any of its related persons is, with respect to
NYSE National, an ETP Holder.
New Section 12.1.b would provide that, subject to its fiduciary
obligations under applicable law, for so long as ICE directly or
indirectly controls NYSE National (or its successor), the Board of
Directors of ICE shall not adopt any resolution pursuant to clause (b)
of Section B(2) of Article V of ICE's Certificate of Incorporation,
unless the Board of Directors shall have determined that neither such
person nor any of its related persons is an ETP Holder.
New Section 12.2 would provide that, for so long as ICE shall
control, directly or indirectly, NYSE National (or its successor), the
ICE board of directors shall not adopt any resolution to repeal or
amend any provision of the certificate of incorporation of ICE unless
such amendment or repeal shall either be (a) filed with or filed with
and approved by the SEC under Section 19 of the Exchange Act and the
rules promulgated thereunder or (b) submitted to the board of directors
of NYSE National (or the board of directors of its successor), and if
such board of directors determines that such amendment or repeal must
be filed with or filed with and approved by the Commission under
Section 19 of the Exchange Act and the rules promulgated thereunder
before such amendment or repeal may be effectuated, then such amendment
or repeal shall not be effectuated until filed with or filed with and
approved by the Commission, as the case may be.
Proposed Eighth Amended and Restated Certificate of Incorporation of
Intercontinental Exchange Holdings, Inc. (``ICE Holdings Certificate of
Incorporation'')
The ICE Holdings Certificate of Incorporation is being amended as
follows:
On the first page, add ``Eighth'' and delete ``Seventh''
before ``Amended and Restated Certificate of Incorporation'' in the
heading and update items (2)-(5) accordingly to reflect that this would
be the eighth amendment and restatement including replacing an
incorrect reference to ``Sixth'' before ``Amended'' in item (3). The
date would also be updated in the preamble on the first page.
To distinguish between the ETP Holders of NYSE Arca
Equities and those of NYSE National, subsection A.3.c.ii of Article V
(Limitations on Voting and Ownership) would be amended to define an ETP
Holder of NYSE Arca Equities as an ``NYSE Arca Equities ETP Holder.''
Obsolete references to NYSE Market (DE) and NYSE Regulation, would also
be deleted.\8\
---------------------------------------------------------------------------
\8\ See note 7, supra.
---------------------------------------------------------------------------
Subsection A.3.c of Article V would be amended to add a new
subsection (v), similar to those in place for the other NYSE Exchanges,
which would provide that for so long as the ICE Holdings directly or
indirectly controls NYSE National (or its successor), no person nor any
of its related persons (as those terms are defined therein) is an ETP
Holder (as proposed to be defined in the bylaws of NYSE National,
discussed above) of NYSE National.
Subsection A.3.d of Article V would be amended to add
``NYSE Arca'' before ``ETP Holder'' in one place to distinguish between
the NYSE Arca Equities ETP Holders of and those of NYSE National.
Subsection (A)(3)(d) would be further amended to add a new
subsection (v) similar to those in place for the other NYSE Exchanges.
The new subsection would incorporate NYSE National into the existing
restriction, such that the ICE Holdings Board of Directors would be
restricted from adopting a resolution to approve the exercise of voting
rights that would exceed 20% of the then outstanding votes entitled to
be cast on such matter, where neither such person nor any of its
related persons is, with respect to NYSE National, an NYSE National ETP
Holder.
Subsection B.3 of Article V would be amended to add a new
subsection (g) similar to those in place for the other NYSE Exchanges,
incorporating NYSE National into the restriction on the ICE Holdings
board of directors adopting any resolution pursuant to clause (b) of
Section B.2 of Article V of the ICE Holdings Certificate of
Incorporation (which relates to ICE board of directors approval of
ownership of ICE capital stock by a person together with its related
persons in excess of 20%) unless the NYSE Holdings board of directors
determines that, for so long as ICE Holdings controls NYSE National,
neither such person nor any of its related persons is an NYSE National
ETP Holder.
Proposed Fifth Amended and Restated Bylaws of Intercontinental Exchange
Holdings, Inc. (``ICE Holdings Bylaws'')
The ICE Holdings Bylaws are being amended as follows:
The cover page and heading on the first page would be
amended to add ``Fifth'' and delete ``Fourth'' before ``Amended and
Restated Bylaws'' to reflect that this would be the fifth amendment and
restatement. The effective date on the cover page would also be
updated.
Similar to the ICE Bylaws discussed above, the ICE
Holdings Bylaws would be amended to include ``NYSE National, Inc.'' in:
The definition of ``U.S. Regulated Subsidiaries'' in
Article III, Section 3.15, which currently includes the NYSE, NYSE
Market (DE), NYSE Regulation, NYSE Arca, LLC, NYSE Arca, NYSE Arca
Equities, and the Exchange, and to provide that the term ``U.S.
Regulated Subsidiaries'' includes those entities
[[Page 96131]]
listed or their successors, but only so long as they continue to be
controlled, directly or indirectly, by ICE Holdings. Obsolete
references to NYSE Market (DE) and NYSE Regulation in that section
would also be deleted; \9\
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\9\ See note 7, supra.
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Article VIII (Confidential Information), Section 8.1,
which would be amended to extend the same protection to confidential
information relating to the self-regulatory function of NYSE National
or its successor; \10\ and
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\10\ Article VIII, Section 8.1 would also be amended to delete
obsolete references to NYSE Market (DE) and NYSE Regulation.
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Article XI (Amendment to the Bylaws), Section 11.3, which
provides that, for so long as ICE controls any of the U.S. Regulated
Subsidiaries, any amendment to or repeal of the ICE Bylaws must either
be (i) filed with or filed with and approved by the Commission under
section 19 of the Exchange Act and the rules promulgated thereunder, or
(ii) submitted to the boards of directors of the U.S. Regulated
Subsidiaries or the boards of directors of their successors, in each
case only to the extent that such entity continues to be controlled
directly or indirectly by ICE Holdings. Obsolete references to NYSE
Market (DE) and NYSE Regulation would also be deleted from Article VXI,
Section 11.3.\11\
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\11\ See note 7, supra. Conforming changes to delete and replace
connectors would also be made throughout.
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Proposed Independence Policy of the Board of Directors of
Intercontinental Exchange, Inc. (``ICE Director Independence Policy'')
The ICE Director Independence Policy would be amended to add NYSE
National to the section describing ``Independence Qualifications.'' In
particular, NYSE National would be added to categories (1)(b) and (c)
that refer to ``members,'' as defined in section 3(a)(3)(A)(i),
3(a)(3)(A)(ii), 3(a)(3)(A)(iii) and 3(a)(3)(A)(iv) of the Exchange
Act.\12\ The clause ``and `Person Associated with an ETP Holder' (as
defined in Rule 1.5 of NYSE National, Inc.)'' would also be added to
category (1)(b) in reference to ``allied persons.'' NYSE National would
also be added to subsections (4) and (5) of the ``Independence
Qualifications'' section.\13\ Obsolete references to NYSE Market (DE)
and NYSE Regulation would also be deleted.\14\
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\12\ See 15 U.S.C. 78c(a)(3)(a).
\13\ Conforming changes would also be made to delete and replace
connectors. The link in footnote 2 to the NYSE Listed Company Manual
and commentary would also be updated.
\14\ See note 7, supra.
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Proposed Eighth Amended and Restated Limited Liability Company
Agreement of NYSE Holdings LLC (``NYSE Holdings LLC Operating
Agreement'')
The NYSE Holdings LLC Operating Agreement would be amended as
follows:
The heading and preamble would be amended to add
``Eighth'' and delete ``Seventh'' before ``Amended and Restated Limited
Liability Agreement'' to reflect that this would be the eighth
amendment and restatement. The effective date would also be updated.
After ``This Agreement amends and restates in its entirety that'' in
the second full sentence would be added the clause ``certain Seventh
Amended and Restated Limited Liability Company Agreement, dated as of
May 22, 2015, which amended and restated in its entirety that.''
The current penultimate whereas clause would be amended by
adding ``in May 2015'' before ``the Company'' and ``now desires to
amend and restate'' immediately following would be replaced with
``amended and restated.'' ``Had'' and ``are'' would be changed to the
past tense ``had'' [sic] and ``were'' in the final sentence.
The following new whereas clause would be added
immediately above the current last whereas clause: ``WHEREAS, the
Company now desires to amend and restate the Seventh Amended and
Restated Agreement to reflect the acquisition of NYSE National, Inc. by
the Company's wholly-owned subsidiary NYSE Group, Inc.;''.
The definition of ETP Holder in Article I
(Interpretation), Section 1.1 would be deleted and new definitions of
an NYSE Arca ETP Holder and NYSE National ETP Holder would be added.
The obsolete definition of NYSE Market (DE) would be deleted.\15\
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\15\ See note 7, supra.
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Article IX (Voting and Ownership Limitations), Section
9.1(a)(3)(C) would be amended to add ``NYSE Arca'' before ``ETP
Holder'' and the defined term ``NYSE Arca ETP Holder'' to distinguish
between the ETP Holders of NYSE Arca Equities and those of NYSE
National. An obsolete reference to NYSE Market (DE) would also be
deleted from Section 9.1(a)(3)(C).\16\
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\16\ See note 7, supra. Conforming changes to delete and replace
connectors would also be made throughout.
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Section 9.1(a)(3)(C) would be amended to add a new subsection (v)
similar to those in place for the other NYSE Exchanges. The new
subsection (v) would incorporate NYSE National into the existing
restriction, such that the ICE Holdings board of directors would be
restricted from adopting a resolution pursuant to clause (b) of Section
9.1(a)(2) unless the NYSE Holdings board of directors determines that,
for so long as NYSE Holdings directly or indirectly controls NYSE
National, Inc. (or its successor), neither such person nor any of its
related persons is an ETP Holder (as defined in the bylaws of NYSE
National, as such bylaws may be in effect from time to time) of NYSE
National (``NYSE National ETP Holder''). The clause would also provide
that any such person that is a related person of an ETP Holder shall
hereinafter also be deemed to be an ``NYSE National ETP Holder'' for
purposes of the agreement, as the context may require.
Article IX, Section 9.1(a)(3)(D) would be amended to add
``NYSE Arca'' before ``ETP Holder.'' An outdated reference to NYSE
Market (DE) would also be deleted.
Further, a new clause (v) would be added to Section 9.1(a)(3)(D) to
incorporate NYSE National into the existing restriction on the NYSE
Holdings Board of Directors, such that it would be restricted from
adopting a resolution to approve the exercise of voting rights that
would exceed 20% of the then outstanding votes entitled to be cast on
such matter for so long as NYSE Holdings controls NYSE National. The
clause would provide that ``for so long as the Corporation directly or
indirectly controls NYSE National, neither such person nor any of its
Related Persons is an NYSE National ETP Holder.''
Article IX, Section 9.1(b)(3) of Article IX [sic] would be
amended to add a new subpart (G) to incorporate NYSE National into the
existing restriction on the NYSE Holdings Board of Directors, so that
it would provide that, subject to its fiduciary obligations under
applicable law, for so long as NYSE Holdings directly or indirectly
controls NYSE National (or its successor), the board of directors of
NYSE Holdings shall not adopt any resolution pursuant to (b) of Section
9.1(b)(2) of the NYSE Holdings LLC Operating Agreement, unless the
board of directors of NYSE Holdings shall have determined that neither
such person nor any of its related persons is an NYSE National ETP
Holder.
Proposed Fifth Amended and Restated Certificate of Incorporation of
NYSE Group, Inc. (``NYSE Group Certificate of Incorporation'')
The NYSE Group Certificate of Incorporation is being amended as
follows:
On the first page, add ``Fifth'' and delete ``Fourth''
before ``Amended and
[[Page 96132]]
Restated Certificate of Incorporation'' in the heading. The Recitations
would be amended to reflect that this would be the fifth amendment and
restatement. First, the Fifth Recitation would be updated to reflect
that a Fourth Amended and Restated Certificate of Incorporation was
filed with the Secretary of State of the State of Delaware on December
29, 2014. A new Sixth Recitation would be updated to reflect that the
Fifth Amended and Restated Certificate of Incorporation has been duly
adopted. The current Sixth Recitation would become the Seventh and
would reflect that the Fourth Amended and Restated Certificate of
Incorporation is amended and restated in its entirety.
NYSE National would be added to the list of ``Regulated
Subsidiaries'' in Article 4 (Stock), Section 4(b)(1), which currently
includes the NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, LLC,
NYSE Arca Equities, and NYSE MKT, and the obsolete references to NYSE
Market (DE) and NYSE Regulation would be deleted.
To distinguish between the ETP Holders of NYSE Arca
Equities and those of NYSE National, Section 4(b)(1)(y) of Article IV
would be amended to define an ETP Holder of NYSE Arca Equities as an
``NYSE Arca Equities ETP Holder.'' An outdated reference to NYSE Market
(DE) would also be deleted.
Section 4(b)(1)(y) would also be amended to add a provision to
[sic] similar to those in place for the other NYSE Exchanges providing
that, for so long as NYSE Group directly or indirectly controls NYSE
National (or its successor), neither such person nor any of its related
persons is an ETP Holder (as defined in the rules of NYSE National, as
such rules may be in effect from time to time) of NYSE National
(defined as an ``NYSE National ETP Holder'') and that any such person
that is a related person of an NYSE National ETP Holder shall
hereinafter also be deemed to be an ``NYSE National ETP Holder'' for
purposes of the certificate of incorporation, as the context may
require.
Further, subsection 4(b)(1)(z) of Article IV would be
amended to define an ETP Holder of NYSE Arca Equities as an ``NYSE Arca
Equities ETP Holder'' and delete an outdated reference to NYSE Market
(DE). Subsection 4(b)(1)(z) would also be amended to incorporate NYSE
National into the existing restriction on the ICE Holdings Board of
Directors, such that it would be restricted from adopting a resolution
to approve the exercise of voting rights that would exceed 20% of the
then outstanding votes entitled to be cast on such matter, where
neither such person nor any of its related persons is, with respect to
NYSE National, an NYSE National ETP Holder.
A new subpart (vii) would be added to subsection
4(b)(2)(C) of Article IV to incorporate NYSE National into the existing
restriction on the NYSE Group Board of Directors, such that it would be
restricted from adopting a resolution to approve the exercise of voting
rights that would exceed 20% of the then outstanding votes entitled to
be cast on such matter, where neither such person nor any of its
related persons is, with respect to NYSE National, an NYSE National ETP
Holder.\17\
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\17\ An obsolete reference to NYSE Market (DE) would also be
deleted from Article IV, 4(b)(2)(C)(v).
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Article X (Confidential Information) would be amended to
extend the same protection to confidential information relating to the
self-regulatory function of NYSE National or its successor and delete
obsolete references to NYSE Market (DE) and NYSE Regulation.
Article XII (Amendments to Certificate of Incorporation)
provides that, for so long as NYSE Group controls the Regulated
Subsidiaries, before any amendment or repeal of any provision of the
Certificate of Incorporation shall be effective, such amendment or
repeal shall either (a) be filed with or filed with and approved by the
SEC under Section 19 of the Exchange Act and the rules promulgated
thereunder or (b) be submitted to the boards of directors of NYSE, NYSE
Market (DE), NYSE Regulation, NYSE Arca, NYSE Arca Equities, and NYSE
MKT or the boards of directors of their successors. Article XII would
be amended to add NYSE National to subsection (b) and delete references
to NYSE Market (DE) and NYSE Regulation.
Proposed Third Amended and Restated Bylaws of NYSE Group, Inc. (``NYSE
Group Bylaws'')
The NYSE Group Bylaws are being amended as follows:
Add ``Third'' and delete ``Second'' before ``Amended and
Restated Bylaws'' in the heading to reflect that this would be the
third amendment and restatement.
Article VII (Miscellaneous), Section 7.9(A)(b) currently
provides that, for so long as NYSE Group controls any of the NYSE
Exchanges, any amendment to or repeal of the ICE Bylaws must either be
(i) filed with or filed with and approved by the Commission under
section 19 of the Exchange Act and the rules promulgated thereunder, or
(ii) submitted to the boards of directors of the NYSE, NYSE Market
(DE), NYSE Regulation, NYSE Arca, NYSE Arca Equities, and NYSE
Alternext US LLC or the boards of directors of their successors, in
each case only to the extent that such entity continues to be
controlled directly or indirectly by ICE. Section 7.9(A)(b) would be
amended to delete obsolete references to NYSE Market (DE) and NYSE
Regulation, replace the outdated reference to ``NYSE Alternext US LLC''
with ``NYSE MKT LLC,'' and add NYSE National.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Exchange Act \18\ in general, and with Section
6(b)(1) \19\ in particular, in that it enables the Exchange to be so
organized as to have the capacity to be able to carry out the purposes
of the Exchange Act and to comply, and to enforce compliance by its
exchange members and persons associated with its exchange members, with
the provisions of the Exchange Act, the rules and regulations
thereunder, and the rules of the Exchange. The Exchange believes that
the proposed changes to the corporate documents of the NYSE Group and
its intermediary and ultimate parent entities, including the ICE bylaws
and director independence policy, ICE Holdings bylaws and certificate
of incorporation, NYSE Holdings operating agreement, and the NYSE Group
bylaws and certificate of incorporation, to reflect the Acquisition,
including updating corporate names, would contribute to the orderly
operation of the Exchange by adding clarity and transparency to the
Exchange's rules and would enable the Exchange to continue to be so
organized as to have the capacity to carry out the purposes of the
Exchange Act and comply and enforce compliance with the provisions of
the Exchange Act by its members and persons associated with its
members. The Exchange therefore believes that approval of the amendment
to the Bylaws is consistent with Section 6(b)(1).
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\18\ 15 U.S.C. 78f(b).
\19\ 15 U.S.C. 78f(b)(1).
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For similar reasons, the Exchange also believes that this filing
furthers the objectives of Section 6(b)(5) of the Exchange Act \20\
because the proposed rule change would be consistent with and
facilitate [sic] would create a governance and regulatory structure
that is designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to foster
cooperation and
[[Page 96133]]
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. As discussed above, the
proposed updates to the corporate documents and replacement of outdated
or obsolete references removes impediments to and perfects the
mechanism of a free and open market by removing confusion that may
result from having these references in the governing documents
following the Acquisition. The Exchange further believes that the
proposal removes impediments to and perfects the mechanism of a free
and open market by ensuring that persons subject to the Exchange's
jurisdiction, regulators, and the investing public can more easily
navigate and understand the governing documents. The Exchange further
believes that eliminating an obsolete reference would not be
inconsistent with the public interest and the protection of investors
because investors will not be harmed and in fact would benefit from
increased transparency, thereby reducing potential confusion. Removing
such obsolete references will also further the goal of transparency and
add clarity to the Exchange's rules.
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\20\ 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 Exchange Act. The proposed rule
change is not intended to address competitive issues but rather is
concerned solely with updating the Exchange's rules to reflect the
Acquisition and to remove obsolete references.
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 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate 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 or disapprove such 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 (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NYSEMKT-2016-122 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEMKT-2016-122. This
file number should be included on the subject line if email 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 Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the 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 Number SR-NYSEMKT-2016-122 and should
be submitted on or before January 19, 2017.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\21\
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\21\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016-31487 Filed 12-28-16; 8:45 am]
BILLING CODE 8011-01-P
