81_FR_15421 81 FR 15366 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending and Restating the Fifth Amended and Restated Bylaws of the Exchange's Ultimate Parent Company, Intercontinental Exchange, Inc., To Implement Proxy Access

81 FR 15366 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending and Restating the Fifth Amended and Restated Bylaws of the Exchange's Ultimate Parent Company, Intercontinental Exchange, Inc., To Implement Proxy Access

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 55 (March 22, 2016)

Page Range15366-15371
FR Document2016-06364

Federal Register, Volume 81 Issue 55 (Tuesday, March 22, 2016)
[Federal Register Volume 81, Number 55 (Tuesday, March 22, 2016)]
[Notices]
[Pages 15366-15371]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-06364]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77386; File No. SR-NYSEMKT-2016-20]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of 
Proposed Rule Change Amending and Restating the Fifth Amended and 
Restated Bylaws of the Exchange's Ultimate Parent Company, 
Intercontinental Exchange, Inc., To Implement Proxy Access

March 17, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on March 2, 2016, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the self-regulatory organization. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend and restate the Fifth Amended and 
Restated Bylaws of the Exchange's ultimate parent company, 
Intercontinental Exchange, Inc. (``ICE''), to implement proxy access. 
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.

[[Page 15367]]

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
    The Exchange proposes to amend and restate the Fifth Amended and 
Restated Bylaws of ICE (``ICE Bylaws''). The proposed amendments to the 
ICE Bylaws would (1) add a new Section 2.15 that permits a stockholder, 
or stockholders, that meet specific requirements to nominate director 
nominees for the board of directors of ICE (``ICE Board''), provided 
that the nominating stockholder(s) and nominee(s) satisfy the proposed 
requirements, and (2) amend the advance notice provisions in Section 
2.13 to account for proxy access.\4\
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    \4\ In November 2015, the Comptroller of the City of New York, 
on behalf of certain city retirement systems that are stockholders 
of ICE, requested that ICE include a proxy access proposal in its 
2016 proxy statement. After discussions with the Comptroller's 
office, ICE management determined to recommend the amendment 
reflected in the proposed rule change to the ICE Board and, on that 
basis, the Comptroller's request was withdrawn.
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    ICE owns 100% of the equity interest in Intercontinental Exchange 
Holdings, Inc. (``ICE Holdings''), which in turn owns 100% of the 
equity interest in NYSE Holdings LLC (``NYSE Holdings''). NYSE Holdings 
owns 100% of the equity interest of NYSE Group, Inc., which in turn 
directly owns 100% of the equity interest of the Exchange and its 
affiliates New York Stock Exchange LLC and NYSE Arca, Inc.\5\
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    \5\ The Exchange's affiliates have each submitted proposed rule 
changes to propose the changes described in this filing. See SR-
NYSE-2016-14 and SR-NYSEArca-2016-25.
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    The proposed amendments to the ICE Bylaws have been approved by the 
ICE Board, subject to Securities and Exchange Commission 
(``Commission'') approval. Under Section 11.1 of the ICE Bylaws, no 
stockholder approval is required for amendment of the ICE Bylaws. ICE 
filed a Form 8-K setting forth the proposed amendments on January 22, 
2016 after approval by the ICE Board, and will file a further Form 8-K 
when the amendments are adopted.
Bylaw Section 2.15
    The proposed rule change would add new Section 2.15 to the ICE 
Bylaws. Section 2.15 would permit a stockholder, or group of up to 20 
stockholders, to nominate director nominees for the ICE Board, so long 
as the stockholder(s) have owned at least three percent of ICE's 
outstanding shares of common stock continuously for at least three 
years. The director nominees would be included in ICE's annual meeting 
proxy materials. The proposed provision would limit the number of 
proposed director nominees to a number equal to twenty percent of the 
number of directors then serving on the ICE Board (rounded down to the 
nearest whole number, but no less than two) provided that the 
stockholder(s) and nominee(s) satisfy the other conditions specified in 
the ICE Bylaws.
    A candidate would be nominated by a nomination notice (``Nomination 
Notice''). Subject to satisfaction of the conditions of Section 2.15, 
described below, as determined by the ICE Board, ICE would include in 
its proxy statement for the next annual meeting of stockholders the 
following information:
     The names of any person or persons nominated for election;
     disclosure about each nominee and the nominating 
stockholder required under the rules of the Commission or other 
applicable law to be included in the proxy statement;
     any statement in support of the nominee's (or nominees', 
as applicable) election, subject to a limit of 500 words and subject to 
compliance with Section 14 of the Exchange Act \6\ and the rules 
thereunder, including Rule 14a-9; \7\ and
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    \6\ 15 U.S.C. 78n.
    \7\ 17 CFR 240.14a-9.
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     any other information that ICE management or the ICE Board 
determines, in their discretion, to include relating to the nomination 
of the nominee(s), including, without limitation, any statement in 
opposition to the nomination.\8\
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    \8\ Proposed ICE Bylaw 2.15(a).
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    ICE Bylaw 2.15 would permit stockholder nominees to constitute up 
to twenty percent of the number of directors then serving on the ICE 
Board, subject to the following:
     If twenty percent of the current number of directors is 
not a whole number, the number of permitted stockholder nominees would 
be rounded down to the nearest whole number, but no less than two.
     The number of permitted stockholder nominees would be 
further reduced by (a) the number of any stockholder nominees who are 
withdrawn or who are instead nominated by the ICE Board and (b) the 
number of directors, if any, who were stockholder nominees at the 
preceding annual meeting and whose re-election is recommended by the 
ICE Board. In the event that one or more vacancies for any reason were 
to occur on the ICE Board after the deadline for submitting a 
Nomination Notice, but before the date of the annual meeting, and the 
ICE Board resolved to reduce the size of the ICE Board, the number of 
permitted stockholder nominees would be calculated based on the number 
of directors in office as so reduced. If, after receipt of a Nomination 
Notice and following the deadline for receipt of such notices, either 
the nominating stockholder becomes ineligible or withdraws the 
nomination, or the nominee becomes ineligible or unwilling or unable to 
serve, such nominee will be disregarded.
     Bylaw 2.15(b) would provide a mechanism for pro rata 
reduction of the number of nominees nominated by different stockholders 
if the total number of permitted stockholder nominees exceeded the 
maximum permitted. Each nominating stockholder would select one of its 
nominees to be included in the proxy statement, with the nominees to be 
included selected from nominating stockholders going in the order of 
the largest stockholdings to the smallest, until the available number 
of nominees has been selected, with this process to be repeated if the 
maximum number of nominees has not been selected in the first round.
    As a result of these potential reductions in the number of 
stockholder nominees, the number of stockholder nominees in any year 
could be fewer than two.
    Each person or group of up to 20 persons desiring to nominate a 
candidate would be required to either (1) be a record holder of shares 
of ICE common stock used to satisfy the eligibility requirements for a 
stockholder nominee continuously for the three-year period, or (2) 
provide to the secretary of ICE evidence of continuous ownership of the 
minimum number of shares for such three-year period from one or more 
securities intermediaries in a form that the ICE Board determines would 
be acceptable for purposes of a shareholder proposal under Rule 14a-
8(b)(2) under the

[[Page 15368]]

Exchange Act \9\ (or any successor rule). The minimum number of shares 
would be determined as three percent of the outstanding shares as of 
the most recent date for which the total number of outstanding shares 
of common stock was included by ICE in a filing with the Commission 
prior to the submission of the Nomination Notice. Such shares would be 
required to be held continuously throughout the three-year period 
preceding and including the date of submission of the Nomination 
Notice, and through the date of the annual meeting. The proposed rule 
change includes provisions relating to how the members of a group would 
be counted and the consequences of withdrawal of a member from a 
group.\10\
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    \9\ 17 CFR 240.14a-8(b)(2).
    \10\ Proposed ICE Bylaw 2.15(c).
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    A person (or member of a group of persons) whose nominee has been 
elected as a director at an annual meeting would not be eligible to 
nominate or participate in the nomination of a nominee for the 
following two annual meetings other than the nomination of such 
previously elected nominee.\11\
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    \11\ Proposed ICE Bylaw 2.15(c)(i).
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    The proposed rule change would also specify that shares may be 
counted as ``owned'' only if the person making the nomination possess 
both the full voting and investment rights pertaining to the shares and 
the full economic interest in (including the opportunity for profit and 
risk of loss on) such shares. Shares that have been sold, borrowed or 
hedged are excluded. Loaned shares are included, provided they are 
recallable within five business days, and are recalled by the record 
date.\12\
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    \12\ Proposed ICE Bylaw 2.15(c)(iv).
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    No person would be permitted to be in more than one group 
nominating a nominee. A person who appears as a member of more than one 
group would be deemed to be a member of the group that has the largest 
ownership position as reflected in the Nomination Notice.\13\
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    \13\ Proposed ICE Bylaw 2.15(c)(v).
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    A Nomination Notice would be required to be submitted to the 
secretary of ICE at ICE's principal executive office, no earlier than 
the close of business 150 calendar days, and no later than the close of 
business 120 calendar days, before the anniversary of the date that ICE 
mailed its proxy statement for the prior year's annual meeting of 
stockholders. If an annual meeting were not scheduled to be held within 
a period that commences 30 days before and ends 30 days after such 
anniversary date, a Nomination Notice would be required to be given by 
the later of the close of business on the date that is 120 days prior 
to the date of such annual meeting or the tenth day following the date 
on which such annual meeting date is first publicly announced or 
disclosed.\14\
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    \14\ Proposed ICE Bylaw 2.15(d).
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    ICE Bylaw 2.15 would provide that any determination to be made by 
the ICE Board may be made by the ICE Board, a committee of the ICE 
Board or any officer of ICE designated by the ICE Board or a committee 
of the ICE Board and that any such determination shall be final and 
binding on ICE, any Eligible Holder (as defined in ICE Bylaw 2.15), any 
nominating stockholder, any nominee and any other person so long as 
made in good faith. The chairman of any annual meeting of stockholders 
shall have the power and duty to determine whether a Nominee has been 
nominated in accordance with the requirements of proposed Section 2.15 
and, if not so nominated, shall direct and declare at the annual 
meeting that such Nominee shall not be considered.\15\
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    \15\ The Exchange notes that having the chairman of the annual 
meeting make such determination is consistent with the procedure in 
Section 2.13(f) of the ICE Bylaws with respect to non-proxy access 
nominations.
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    The proposed rule change specifies information that would be 
required in a Nomination Notice, including:
     A Schedule 14N \16\ (or any successor form) relating to 
the nomination, completed and filed with the Commission;
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    \16\ 17 CFR 240.14n-101.
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     a written notice, in a form deemed satisfactory by the ICE 
Board, of the nomination of such nominee that includes additional 
information, agreements, representations and warranties by the 
nominating stockholder (including, in the case of a group, each group 
member),
    [cir] the information otherwise required with respect to the 
nomination of directors by the ICE Bylaws;
    [cir] the details of any relationship that existed within the past 
three years and that would have been described pursuant to Item 6(e) of 
Schedule 14N (or any successor item) if it existed on the date of 
submission of the Schedule 14N;
    [cir] a representation and warranty that the nominating stockholder 
did not acquire, and is not holding, securities of ICE for the purpose 
or with the effect of influencing or changing control of ICE;
    [cir] a representation and warranty that the nominee's candidacy 
or, if elected, membership on the ICE Board would not violate 
applicable state or federal law or the rules of the principal national 
securities exchange on which ICE's securities are traded;
    [cir] a representation and warranty that the nominee:
    [ssquf] Does not have any direct or indirect relationship with ICE 
that will cause the nominee to be deemed not independent pursuant to 
the ICE Board's Independence Policy \17\ as most recently published on 
its Web site and otherwise qualifies as independent under the rules of 
the principal national securities exchange on which ICE's common stock 
is traded; \18\
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    \17\ The Commission notes that the Independence Policy can be 
found at the following Web site: http://ir.theice.com/~/media/Files/
I/Ice-IR/documents/corporate-governance-documents/board-
independence-policy.pdf.
    \18\ The Commission notes the independent director standards of 
New York Stock Exchange LLC (``NYSE''), which is the principal 
market for ICE's common stock, are set forth in NYSE's Listed 
Company Manual in Sections 303A.00, 303A.01 and 303A.02.
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    [ssquf] meets the audit committee independence requirements under 
the rules of the principal national securities exchange on which ICE's 
common stock is traded; \19\
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    \19\ The Commission notes that the audit committee independence 
requirements of NYSE, the principle market for ICE's common stock, 
are set forth in NYSE's Listed Company Manual under Sections 303A.06 
and 303A.07.
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    [ssquf] is a ``non-employee director'' for the purposes of Rule 
16b-3 under the Exchange Act \20\ (or any successor rule);
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    \20\ 17 CFR 240.16b-3.
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    [ssquf] is an ``outside director'' for the purposes of Section 
162(m) of the Internal Revenue Code \21\ (or any successor provision); 
and
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    \21\ 26 U.S.C. 162(m).
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    [ssquf] is not and has not been subject to any event specified in 
Rule 506(d)(1) of Regulation D \22\ (or any successor rule) under the 
Securities Act of 1933 or Item 401(f) of Regulation S-K \23\ (or any 
successor rule) under the Exchange Act, without reference to whether 
the event is material to an evaluation of the ability or integrity of 
the nominee;
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    \22\ 17 CFR 230.506(d).
    \23\ 17 CFR 229.401(f).
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    [cir] a representation and warranty that the nominating stockholder 
satisfies the eligibility requirements set forth in Bylaw 2.15 and has 
provided evidence of ownership to the extent required by Bylaw 
2.15(c)(i);
    [cir] a representation and warranty that the nominating stockholder 
intends to continue to satisfy the eligibility requirements described 
in Bylaw 2.15(c) through the date of the annual meeting;
    [cir] a representation and warranty that the nominating stockholder 
will not engage in a ``solicitation'' within the meaning of Rule 14a-
1(l) \24\ (without

[[Page 15369]]

reference to the exception in Rule 14a-(l)(l)(2)(iv) \25\) (or any 
successor rules) under the Exchange Act in support of the election of 
any individual as a director at the applicable annual meeting, other 
than its nominee(s) or any nominee of the ICE Board;
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    \24\ 17 CFR 240.14a-1(l).
    \25\ 17 CFR 240.14a-1(l)(2)(iv).
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    [cir] a representation and warranty that the nominating stockholder 
will not use any proxy card other than ICE's proxy card in soliciting 
stockholders in connection with the election of a nominee at the annual 
meeting;
    [cir] if desired, a statement in support of the nominee meeting the 
standards identified above; and
    [cir] in the case of a nomination by a group, the designation by 
all group members of one group member that is authorized to act on 
behalf of all group members with respect to matters relating to the 
nomination, including withdrawal of the nomination;
     an executed agreement, in a form deemed satisfactory by 
the ICE Board, pursuant to which the nominating stockholder (including 
each group member) agrees:
    [cir] to comply with all applicable laws, rules and regulations in 
connection with the nomination, solicitation and election of a nominee;
    [cir] to file any written solicitation or other communication with 
ICE's stockholders relating to one or more of ICE's directors or 
director nominees or any stockholder nominee with the Commission, 
regardless of whether any such filing is required under any rule or 
regulation or whether any exemption from filing is available for such 
materials under any rule or regulation;
    [cir] to assume all liability stemming from an action, suit or 
proceeding concerning any actual or alleged legal or regulatory 
violation arising out of any communication by the nominating 
stockholder or any of its nominees with ICE, its stockholders or any 
other person in connection with the nomination or election of 
directors, including, without limitation, the Nomination Notice;
    [cir] to indemnify and hold harmless (jointly with all other group 
members, in the case of a group member) ICE and each of its directors, 
officers and employees individually against any liability, loss, 
damages, expenses or other costs (including attorneys' fees) incurred 
in connection with any threatened or pending action, suit or 
proceeding, whether legal, administrative or investigative, against ICE 
or any of its directors, officers or employees arising out of or 
relating to a failure or alleged failure of the nominating stockholder 
or any of its nominees to comply with, or any breach or alleged breach 
of, its respective obligations, agreements or representations under 
Bylaw 2.15; and
    [cir] in the event that (1) any information included in the 
Nomination Notice or any other communication by the nominating 
stockholder (including with respect to any group member) with ICE, its 
stockholders or any other person in connection with the nomination or 
election of a nominee ceases to be true and accurate in all material 
respects (or omits a material fact necessary to make the statements 
made not misleading) or (2) the nominating stockholder (including any 
group member) has failed to continue to satisfy the eligibility 
requirements described in Bylaw 2.15(c), to promptly (and in any event 
within 48 hours of discovering such misstatement, omission or failure) 
notify ICE and any other recipient of such communication of (1) the 
misstatement or omission in such previously provided information and of 
the information that is required to correct the misstatement or 
omission or (2) of such failure; and
     an executed agreement, in a form deemed satisfactory by 
the ICE Board, by the nominee:
    [cir] to provide to ICE such other information and certifications, 
including completion of ICE's director questionnaire, as it may 
reasonably request;
    [cir] that the nominee has read and agrees, if elected, to serve as 
a member of the ICE Board, to adhere to ICE's Corporate Governance 
Guidelines and Global Code of Business Conduct and any other policies 
and guidelines applicable to directors; and
    [cir] that the nominee is not and will not become a party to (i) 
any compensatory, payment or other financial agreement, arrangement or 
understanding with any person or entity other than ICE in connection 
with service or action as a director of ICE that has not been disclosed 
to ICE, (ii) any agreement, arrangement or understanding with any 
person or entity as to how the nominee would vote or act on any issue 
or question as a director (a ``Voting Commitment'') that has not been 
disclosed to ICE or (iii) any Voting Commitment that could reasonably 
be expected to limit or interfere with the nominee's ability to comply, 
if elected as a director of ICE, with its fiduciary duties under 
applicable law.
    ICE Bylaw 2.15 would specify that the information and documents 
required to be provided by the nominating stockholder must be: (i) 
Provided with respect to and executed by each group member, in the case 
of information applicable to group members; and (ii) provided with 
respect to the persons specified in Instruction 1 to Items 6(c) and (d) 
of Schedule 14N (or any successor item) in the case of a nominating 
stockholder or group member that is an entity. A Nomination Notice 
would be deemed submitted on the date on which all of the information 
and documents required by ICE Bylaw 2.15 (other than such information 
and documents contemplated to be provided after the date the Nomination 
Notice is provided) have been delivered to or, if sent by mail, 
received by the Secretary of ICE.
    Access to ICE's proxy statement for stockholder nominations under 
ICE Bylaw 2.15(e)(i) would not be available in any year in which ICE 
has received advance notice under ICE Bylaw Section 2.13 that a 
stockholder intends to nominate a director. In addition, nominations 
would be disregarded under ICE Bylaw 2.15(e)(i) if
     the nominating stockholder or its representative fails to 
appear at the annual meeting to present the nomination or withdraws its 
nomination;
     the nomination or election of the nominee would be in 
violation of ICE's certificate of incorporation or bylaws, or 
applicable law, rule or regulation, including those of stock exchanges;
     the nominee was nominated pursuant to ICE Bylaw 2.15 at 
one of the past two annual meetings and either withdrew or became 
ineligible, or failed to receive 20% of the vote;
     the nominee is, or has within the last three years been, 
an officer or director of a competitor of ICE or is a U.S. Disqualified 
Person as defined in ICE's certificate of incorporation; or
     ICE is notified, or the ICE Board determines, that a 
nominating stockholder has failed to continue to satisfy the 
eligibility requirements, any of the representations and warranties 
made in the Nomination Notice ceases to be true and accurate in all 
material respects (or omits a material fact necessary to make the 
statements made not misleading), the nominee becomes unwilling or 
unable to serve on the ICE Board or any material violation or breach 
occurs of the obligations, agreements, representations or warranties of 
the nominating stockholder or the nominee under ICE Bylaw Section 2.15.
    In addition, Bylaw 2.15(e)(ii) would permit ICE to omit from its 
proxy statement, or supplement or correct, any information, including 
all or any portion of the statement in support of the Nominee included 
in the

[[Page 15370]]

Nomination Notice, if the ICE Board determines that:
     Such information is not true in all material respects or 
omits a material statement necessary to make the statements made not 
misleading;
     Such information directly or indirectly impugns the 
character, integrity or personal reputation of, or directly or 
indirectly makes charges concerning improper, illegal or immoral 
conduct or associations, without factual foundation, with respect to, 
any person; or
     The inclusion of such information in the proxy statement 
would otherwise violate the federal proxy rules or any other applicable 
law, rule or regulation.
Bylaw Section 2.13
    The proposed rule change also would amend the existing advance 
notice provisions in Bylaw 2.13 to extend their application to 
stockholder nominations under the proxy access provision in Bylaw 2.15.
     Bylaw 2.13(b) would be amended to provide that stockholder 
nominations would be subject to inclusion in the ICE Board's notice of 
annual meeting, and that the timing and notice requirements of the 
existing advance notice bylaw would not apply to stockholder 
nominations, which have different timing and notice requirements as 
described above.
     Bylaw 2.13(d) would be amended to specify that the 
definition therein of ``publicly announced or disclosed'' would also 
apply in Bylaw 2.15.
Conforming Changes
    Finally, the Exchange proposes to make conforming changes to the 
title of the Bylaws.
2. Statutory Basis
    The Exchange believes that this filing is consistent with Section 
6(b) of the Exchange Act,\26\ in general, and Section 6(b)(1) of the 
Exchange Act,\27\ 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, by permitting a stockholder, or a group of up to twenty 
stockholders, of ICE that meet the stated requirements to nominate and 
have included in ICE's annual meeting proxy materials director 
nominees, the proposed rule change strengthens the corporate governance 
of the Exchange's ultimate parent company and is thus consistent with 
Section 6(b)(1).
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    \26\ 15 U.S.C. 78f(b).
    \27\ 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,\28\ 
because the proposed rule change would be consistent with and 
facilitate 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 
Exchange believes that by expanding the ability of stockholders to 
nominate directors that could constitute a significant percent (20%) of 
the number of directors currently serving on the ICE Board, the 
proposed rule change would ensure better corporate governance and 
accountability to stockholders, thereby protecting investors and the 
public interest.
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    \28\ 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 designed to address any competitive issue in the U.S. or 
European securities markets or have any impact on competition in those 
markets; rather, adoption of a proxy access bylaw by ICE is intended to 
enhance corporate governance and accountability to stockholders.

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 the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, 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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEMKT-2016-20 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-2016-20. 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 (http://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

[[Page 15371]]

available publicly. All submissions should refer to File Number SR-
NYSEMKT-2016-20 and should be submitted on or before April 12, 2016.
---------------------------------------------------------------------------

    \29\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\29\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-06364 Filed 3-21-16; 8:45 am]
 BILLING CODE 8011-01-P



                                                    15366                            Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices

                                                    executions puts significant pressure on                      At any time within 60 days of the                      office of the Exchange. All comments
                                                    an exchange to maintain both execution                    filing of such proposed rule change, the                  received will be posted without change;
                                                    and data fees at reasonable levels.                       Commission summarily may                                  the Commission does not edit personal
                                                      In addition, in the case of products                    temporarily suspend such rule change if                   identifying information from
                                                    that are also redistributed through                       it appears to the Commission that such                    submissions. You should submit only
                                                    market data vendors, such as Bloomberg                    action is necessary or appropriate in the                 information that you wish to make
                                                    and Thompson Reuters, the vendors                         public interest, for the protection of                    available publicly. All submissions
                                                    themselves provide additional price                       investors, or otherwise in furtherance of                 should refer to File Number SR–NYSE–
                                                    discipline for proprietary data products                  the purposes of the Act. If the                           2016–21 and should be submitted on or
                                                    because they control the primary means                    Commission takes such action, the                         before April 12, 2016.
                                                    of access to certain end users. These                     Commission shall institute proceedings                      For the Commission, by the Division of
                                                    vendors impose price discipline based                     under Section 19(b)(2)(B) 16 of the Act to                Trading and Markets, pursuant to delegated
                                                    upon their business models. For                           determine whether the proposed rule                       authority.17
                                                    example, vendors that assess a                            change should be approved or                              Robert W. Errett,
                                                    surcharge on data they sell are able to                   disapproved.                                              Deputy Secretary.
                                                    refuse to offer proprietary products that                 IV. Solicitation of Comments                              [FR Doc. 2016–06408 Filed 3–21–16; 8:45 am]
                                                    their end users do not or will not
                                                                                                                Interested persons are invited to                       BILLING CODE 8011–01–P
                                                    purchase in sufficient numbers. Vendors
                                                                                                              submit written data, views, and
                                                    will not elect to make available NYSE
                                                                                                              arguments concerning the foregoing,
                                                    BBO or NYSE Trades in the legacy                                                                                    SECURITIES AND EXCHANGE
                                                                                                              including whether the proposed rule
                                                    format unless their customers request it,                                                                           COMMISSION
                                                                                                              change is consistent with the Act.
                                                    and customers will not elect to pay the
                                                                                                              Comments may be submitted by any of
                                                    proposed fees unless NYSE BBO and                                                                                   [Release No. 34–77386; File No. SR–
                                                                                                              the following methods:                                    NYSEMKT–2016–20]
                                                    NYSE Trades can provide value in the
                                                    legacy formats by sufficiently increasing                 Electronic Comments
                                                    revenues or reducing costs in the                                                                                   Self-Regulatory Organizations; NYSE
                                                                                                                • Use the Commission’s Internet                         MKT LLC; Notice of Filing of Proposed
                                                    customer’s business in a manner that                      comment form (http://www.sec.gov/
                                                    will offset the fees. The Exchange has                                                                              Rule Change Amending and Restating
                                                                                                              rules/sro.shtml); or                                      the Fifth Amended and Restated
                                                    provided customers with adequate                            • Send an email to rule-comments@
                                                    notice that it intends to discontinue                                                                               Bylaws of the Exchange’s Ultimate
                                                                                                              sec.gov. Please include File Number SR–
                                                    dissemination of the data feeds in the                                                                              Parent Company, Intercontinental
                                                                                                              NYSE–2016–21 on the subject line.
                                                    legacy format. Therefore, the proposed                                                                              Exchange, Inc., To Implement Proxy
                                                    Decommission Extension Fee would                          Paper Comments                                            Access
                                                    only be applicable to those customers                        • Send paper comments in triplicate                    March 17, 2016.
                                                    who have a need or desire to continue                     to Brent J. Fields, Secretary, Securities                    Pursuant to Section 19(b)(1) 1 of the
                                                    to take the data feeds in the legacy                      and Exchange Commission, 100 F Street                     Securities Exchange Act of 1934
                                                    format beyond the period provided for                     NE., Washington, DC 20549–1090.                           (‘‘Act’’) 2 and Rule 19b–4 thereunder,3
                                                    migration to the XDP format. Customers                    All submissions should refer to File                      notice is hereby given that, on March 2,
                                                    who timely migrate to the XDP format                      Number SR–NYSE–2016–22. This file                         2016, NYSE MKT LLC (the ‘‘Exchange’’
                                                    to receive the data feeds would not need                  number should be included on the                          or ‘‘NYSE MKT’’) filed with the
                                                    to receive the data feeds in the legacy                   subject line if email is used. To help the                Securities and Exchange Commission
                                                    format and therefore would not be                         Commission process and review your                        (‘‘Commission’’) the proposed rule
                                                    subject to the Decommission Extension                     comments more efficiently, please use                     change as described in Items I, II, and
                                                    Fee at all. All of these factors operate as               only one method. The Commission will                      III below, which Items have been
                                                    constraints on pricing proprietary data                   post all comments on the Commission’s                     prepared by the self-regulatory
                                                    products.                                                 Internet Web site (http://www.sec.gov/                    organization. The Commission is
                                                    C. Self-Regulatory Organization’s                         rules/sro.shtml). Copies of the                           publishing this notice to solicit
                                                    Statement on Comments on the                              submission, all subsequent                                comments on the proposed rule change
                                                    Proposed Rule Change Received From                        amendments, all written statements                        from interested persons.
                                                    Members, Participants, or Others                          with respect to the proposed rule
                                                                                                              change that are filed with the                            I. Self-Regulatory Organization’s
                                                      No written comments were solicited                      Commission, and all written                               Statement of the Terms of Substance of
                                                    or received with respect to the proposed                  communications relating to the                            the Proposed Rule Change
                                                    rule change.                                              proposed rule change between the                             The Exchange proposes to amend and
                                                    III. Date of Effectiveness of the                         Commission and any person, other than                     restate the Fifth Amended and Restated
                                                    Proposed Rule Change and Timing for                       those that may be withheld from the                       Bylaws of the Exchange’s ultimate
                                                    Commission Action                                         public in accordance with the                             parent company, Intercontinental
                                                                                                              provisions of 5 U.S.C. 552, will be                       Exchange, Inc. (‘‘ICE’’), to implement
                                                      The foregoing rule change is effective                  available for Web site viewing and                        proxy access. The proposed rule change
                                                    upon filing pursuant to Section                           printing in the Commission’s Public
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                                                                                                                                        is available on the Exchange’s Web site
                                                    19(b)(3)(A) 14 of the Act and                             Reference Room, 100 F Street NE.,                         at www.nyse.com, at the principal office
                                                    subparagraph (f)(2) of Rule 19b–4 15                      Washington, DC 20549 on official                          of the Exchange, and at the
                                                    thereunder, because it establishes a due,                 business days between the hours of                        Commission’s Public Reference Room.
                                                    fee, or other charge imposed by the                       10:00 a.m. and 3:00 p.m. Copies of the
                                                    Exchange.                                                 filing also will be available for                           17 17 CFR 200.30–3(a)(12).
                                                                                                              inspection and copying at the principal                     1 15 U.S.C. 78s(b)(1).
                                                      14 15   U.S.C. 78s(b)(3)(A).                                                                                        2 15 U.S.C. 78a.
                                                      15 17   CFR 240.19b–4(f)(2).                              16 15   U.S.C. 78s(b)(2)(B).                              3 17 CFR 240.19b–4.




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                                                                                  Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices                                              15367

                                                    II. Self-Regulatory Organization’s                      forth the proposed amendments on                      rounded down to the nearest whole
                                                    Statement of the Purpose of, and                        January 22, 2016 after approval by the                number, but no less than two.
                                                    Statutory Basis for, the Proposed Rule                  ICE Board, and will file a further Form                  • The number of permitted
                                                    Change                                                  8–K when the amendments are adopted.                  stockholder nominees would be further
                                                       In its filing with the Commission, the                                                                     reduced by (a) the number of any
                                                                                                            Bylaw Section 2.15
                                                    self-regulatory organization included                                                                         stockholder nominees who are
                                                    statements concerning the purpose of,                     The proposed rule change would add                  withdrawn or who are instead
                                                    and basis for, the proposed rule change                 new Section 2.15 to the ICE Bylaws.                   nominated by the ICE Board and (b) the
                                                    and discussed any comments it received                  Section 2.15 would permit a                           number of directors, if any, who were
                                                    on the proposed rule change. The text                   stockholder, or group of up to 20                     stockholder nominees at the preceding
                                                    of those statements may be examined at                  stockholders, to nominate director                    annual meeting and whose re-election is
                                                    the places specified in Item IV below.                  nominees for the ICE Board, so long as                recommended by the ICE Board. In the
                                                    The Exchange has prepared summaries,                    the stockholder(s) have owned at least                event that one or more vacancies for any
                                                    set forth in sections A, B, and C below,                three percent of ICE’s outstanding                    reason were to occur on the ICE Board
                                                    of the most significant parts of such                   shares of common stock continuously                   after the deadline for submitting a
                                                    statements.                                             for at least three years. The director                Nomination Notice, but before the date
                                                                                                            nominees would be included in ICE’s                   of the annual meeting, and the ICE
                                                    A. Self-Regulatory Organization’s                       annual meeting proxy materials. The                   Board resolved to reduce the size of the
                                                    Statement of the Purpose of, and                        proposed provision would limit the                    ICE Board, the number of permitted
                                                    Statutory Basis for, the Proposed Rule                  number of proposed director nominees                  stockholder nominees would be
                                                    Change                                                  to a number equal to twenty percent of                calculated based on the number of
                                                    1. Purpose                                              the number of directors then serving on               directors in office as so reduced. If, after
                                                                                                            the ICE Board (rounded down to the                    receipt of a Nomination Notice and
                                                       The Exchange proposes to amend and                   nearest whole number, but no less than                following the deadline for receipt of
                                                    restate the Fifth Amended and Restated                  two) provided that the stockholder(s)                 such notices, either the nominating
                                                    Bylaws of ICE (‘‘ICE Bylaws’’). The                     and nominee(s) satisfy the other                      stockholder becomes ineligible or
                                                    proposed amendments to the ICE                          conditions specified in the ICE Bylaws.               withdraws the nomination, or the
                                                    Bylaws would (1) add a new Section                        A candidate would be nominated by                   nominee becomes ineligible or
                                                    2.15 that permits a stockholder, or                     a nomination notice (‘‘Nomination                     unwilling or unable to serve, such
                                                    stockholders, that meet specific                        Notice’’). Subject to satisfaction of the             nominee will be disregarded.
                                                    requirements to nominate director                       conditions of Section 2.15, described                    • Bylaw 2.15(b) would provide a
                                                    nominees for the board of directors of                  below, as determined by the ICE Board,                mechanism for pro rata reduction of the
                                                    ICE (‘‘ICE Board’’), provided that the                  ICE would include in its proxy                        number of nominees nominated by
                                                    nominating stockholder(s) and                           statement for the next annual meeting of              different stockholders if the total
                                                    nominee(s) satisfy the proposed                         stockholders the following information:               number of permitted stockholder
                                                    requirements, and (2) amend the                           • The names of any person or persons                nominees exceeded the maximum
                                                    advance notice provisions in Section                    nominated for election;                               permitted. Each nominating stockholder
                                                    2.13 to account for proxy access.4                        • disclosure about each nominee and                 would select one of its nominees to be
                                                       ICE owns 100% of the equity interest                                                                       included in the proxy statement, with
                                                                                                            the nominating stockholder required
                                                    in Intercontinental Exchange Holdings,                                                                        the nominees to be included selected
                                                                                                            under the rules of the Commission or
                                                    Inc. (‘‘ICE Holdings’’), which in turn                                                                        from nominating stockholders going in
                                                                                                            other applicable law to be included in
                                                    owns 100% of the equity interest in                                                                           the order of the largest stockholdings to
                                                                                                            the proxy statement;
                                                    NYSE Holdings LLC (‘‘NYSE
                                                                                                              • any statement in support of the                   the smallest, until the available number
                                                    Holdings’’). NYSE Holdings owns 100%                                                                          of nominees has been selected, with this
                                                                                                            nominee’s (or nominees’, as applicable)
                                                    of the equity interest of NYSE Group,                                                                         process to be repeated if the maximum
                                                                                                            election, subject to a limit of 500 words
                                                    Inc., which in turn directly owns 100%                                                                        number of nominees has not been
                                                                                                            and subject to compliance with Section
                                                    of the equity interest of the Exchange                                                                        selected in the first round.
                                                                                                            14 of the Exchange Act 6 and the rules
                                                    and its affiliates New York Stock                                                                                As a result of these potential
                                                                                                            thereunder, including Rule 14a–9; 7 and
                                                    Exchange LLC and NYSE Arca, Inc.5
                                                       The proposed amendments to the ICE                     • any other information that ICE                    reductions in the number of stockholder
                                                                                                            management or the ICE Board                           nominees, the number of stockholder
                                                    Bylaws have been approved by the ICE                                                                          nominees in any year could be fewer
                                                    Board, subject to Securities and                        determines, in their discretion, to
                                                                                                            include relating to the nomination of the             than two.
                                                    Exchange Commission (‘‘Commission’’)                                                                             Each person or group of up to 20
                                                    approval. Under Section 11.1 of the ICE                 nominee(s), including, without
                                                                                                            limitation, any statement in opposition               persons desiring to nominate a
                                                    Bylaws, no stockholder approval is                                                                            candidate would be required to either
                                                    required for amendment of the ICE                       to the nomination.8
                                                                                                              ICE Bylaw 2.15 would permit                         (1) be a record holder of shares of ICE
                                                    Bylaws. ICE filed a Form 8–K setting                                                                          common stock used to satisfy the
                                                                                                            stockholder nominees to constitute up
                                                      4 In November 2015, the Comptroller of the City       to twenty percent of the number of                    eligibility requirements for a
                                                    of New York, on behalf of certain city retirement       directors then serving on the ICE Board,              stockholder nominee continuously for
                                                    systems that are stockholders of ICE, requested that    subject to the following:                             the three-year period, or (2) provide to
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    ICE include a proxy access proposal in its 2016
                                                                                                              • If twenty percent of the current                  the secretary of ICE evidence of
                                                    proxy statement. After discussions with the                                                                   continuous ownership of the minimum
                                                    Comptroller’s office, ICE management determined         number of directors is not a whole
                                                    to recommend the amendment reflected in the             number, the number of permitted                       number of shares for such three-year
                                                    proposed rule change to the ICE Board and, on that      stockholder nominees would be                         period from one or more securities
                                                    basis, the Comptroller’s request was withdrawn.                                                               intermediaries in a form that the ICE
                                                      5 The Exchange’s affiliates have each submitted
                                                                                                              6 15 U.S.C. 78n.
                                                                                                                                                                  Board determines would be acceptable
                                                    proposed rule changes to propose the changes
                                                    described in this filing. See SR–NYSE–2016–14 and         7 17 CFR 240.14a–9.                                 for purposes of a shareholder proposal
                                                    SR–NYSEArca–2016–25.                                      8 Proposed ICE Bylaw 2.15(a).                       under Rule 14a–8(b)(2) under the


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                                                    15368                         Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices

                                                    Exchange Act 9 (or any successor rule).                  close of business on the date that is 120             securities exchange on which ICE’s
                                                    The minimum number of shares would                       days prior to the date of such annual                 securities are traded;
                                                    be determined as three percent of the                    meeting or the tenth day following the                   Æ a representation and warranty that
                                                    outstanding shares as of the most recent                 date on which such annual meeting date                the nominee:
                                                    date for which the total number of                       is first publicly announced or                           D Does not have any direct or indirect
                                                    outstanding shares of common stock                       disclosed.14                                          relationship with ICE that will cause the
                                                    was included by ICE in a filing with the                    ICE Bylaw 2.15 would provide that                  nominee to be deemed not independent
                                                    Commission prior to the submission of                    any determination to be made by the                   pursuant to the ICE Board’s
                                                    the Nomination Notice. Such shares                       ICE Board may be made by the ICE                      Independence Policy 17 as most recently
                                                    would be required to be held                             Board, a committee of the ICE Board or                published on its Web site and otherwise
                                                    continuously throughout the three-year                   any officer of ICE designated by the ICE              qualifies as independent under the rules
                                                    period preceding and including the date                  Board or a committee of the ICE Board                 of the principal national securities
                                                    of submission of the Nomination Notice,                  and that any such determination shall                 exchange on which ICE’s common stock
                                                    and through the date of the annual                       be final and binding on ICE, any Eligible             is traded; 18
                                                    meeting. The proposed rule change                        Holder (as defined in ICE Bylaw 2.15),                   D meets the audit committee
                                                    includes provisions relating to how the                  any nominating stockholder, any                       independence requirements under the
                                                    members of a group would be counted                      nominee and any other person so long                  rules of the principal national securities
                                                    and the consequences of withdrawal of                    as made in good faith. The chairman of                exchange on which ICE’s common stock
                                                    a member from a group.10                                 any annual meeting of stockholders                    is traded; 19
                                                       A person (or member of a group of                     shall have the power and duty to                         D is a ‘‘non-employee director’’ for the
                                                    persons) whose nominee has been                          determine whether a Nominee has been                  purposes of Rule 16b–3 under the
                                                    elected as a director at an annual                       nominated in accordance with the                      Exchange Act 20 (or any successor rule);
                                                    meeting would not be eligible to                         requirements of proposed Section 2.15                    D is an ‘‘outside director’’ for the
                                                    nominate or participate in the                           and, if not so nominated, shall direct                purposes of Section 162(m) of the
                                                    nomination of a nominee for the                          and declare at the annual meeting that                Internal Revenue Code 21 (or any
                                                    following two annual meetings other                      such Nominee shall not be                             successor provision); and
                                                    than the nomination of such previously                   considered.15                                            D is not and has not been subject to
                                                    elected nominee.11                                          The proposed rule change specifies                 any event specified in Rule 506(d)(1) of
                                                       The proposed rule change would also                   information that would be required in a               Regulation D 22 (or any successor rule)
                                                    specify that shares may be counted as                    Nomination Notice, including:                         under the Securities Act of 1933 or Item
                                                    ‘‘owned’’ only if the person making the                     • A Schedule 14N 16 (or any                        401(f) of Regulation S–K 23 (or any
                                                    nomination possess both the full voting                  successor form) relating to the                       successor rule) under the Exchange Act,
                                                    and investment rights pertaining to the                  nomination, completed and filed with                  without reference to whether the event
                                                    shares and the full economic interest in                 the Commission;                                       is material to an evaluation of the ability
                                                    (including the opportunity for profit and                   • a written notice, in a form deemed               or integrity of the nominee;
                                                    risk of loss on) such shares. Shares that                satisfactory by the ICE Board, of the                    Æ a representation and warranty that
                                                    have been sold, borrowed or hedged are                   nomination of such nominee that                       the nominating stockholder satisfies the
                                                    excluded. Loaned shares are included,                    includes additional information,                      eligibility requirements set forth in
                                                    provided they are recallable within five                 agreements, representations and                       Bylaw 2.15 and has provided evidence
                                                    business days, and are recalled by the                   warranties by the nominating                          of ownership to the extent required by
                                                    record date.12                                           stockholder (including, in the case of a              Bylaw 2.15(c)(i);
                                                       No person would be permitted to be                    group, each group member),                               Æ a representation and warranty that
                                                    in more than one group nominating a                         Æ the information otherwise required               the nominating stockholder intends to
                                                    nominee. A person who appears as a                       with respect to the nomination of                     continue to satisfy the eligibility
                                                    member of more than one group would                      directors by the ICE Bylaws;                          requirements described in Bylaw 2.15(c)
                                                    be deemed to be a member of the group                       Æ the details of any relationship that             through the date of the annual meeting;
                                                    that has the largest ownership position                  existed within the past three years and                  Æ a representation and warranty that
                                                    as reflected in the Nomination Notice.13                 that would have been described                        the nominating stockholder will not
                                                       A Nomination Notice would be                          pursuant to Item 6(e) of Schedule 14N                 engage in a ‘‘solicitation’’ within the
                                                    required to be submitted to the secretary                (or any successor item) if it existed on              meaning of Rule 14a–1(l) 24 (without
                                                    of ICE at ICE’s principal executive                      the date of submission of the Schedule
                                                    office, no earlier than the close of                     14N;                                                    17 The Commission notes that the Independence

                                                    business 150 calendar days, and no later                    Æ a representation and warranty that               Policy can be found at the following Web site:
                                                                                                             the nominating stockholder did not                    http://ir.theice.com/∼/media/Files/I/Ice-IR/
                                                    than the close of business 120 calendar                                                                        documents/corporate-governance-documents/
                                                    days, before the anniversary of the date                 acquire, and is not holding, securities of            board-independence-policy.pdf.
                                                    that ICE mailed its proxy statement for                  ICE for the purpose or with the effect of               18 The Commission notes the independent

                                                    the prior year’s annual meeting of                       influencing or changing control of ICE;               director standards of New York Stock Exchange
                                                    stockholders. If an annual meeting were                     Æ a representation and warranty that               LLC (‘‘NYSE’’), which is the principal market for
                                                                                                             the nominee’s candidacy or, if elected,               ICE’s common stock, are set forth in NYSE’s Listed
                                                    not scheduled to be held within a                                                                              Company Manual in Sections 303A.00, 303A.01
                                                    period that commences 30 days before                     membership on the ICE Board would                     and 303A.02.
                                                                                                             not violate applicable state or federal
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                                                                                                                                                                     19 The Commission notes that the audit
                                                    and ends 30 days after such anniversary
                                                    date, a Nomination Notice would be                       law or the rules of the principal national            committee independence requirements of NYSE,
                                                                                                                                                                   the principle market for ICE’s common stock, are set
                                                    required to be given by the later of the                   14 Proposed                                         forth in NYSE’s Listed Company Manual under
                                                                                                                           ICE Bylaw 2.15(d).
                                                                                                               15 The                                              Sections 303A.06 and 303A.07.
                                                      9 17
                                                                                                                      Exchange notes that having the chairman
                                                           CFR 240.14a–8(b)(2).                              of the annual meeting make such determination is
                                                                                                                                                                     20 17 CFR 240.16b–3.
                                                      10 Proposed ICE Bylaw 2.15(c).                                                                                 21 26 U.S.C. 162(m).
                                                                                                             consistent with the procedure in Section 2.13(f) of
                                                      11 Proposed ICE Bylaw 2.15(c)(i).                                                                              22 17 CFR 230.506(d).
                                                                                                             the ICE Bylaws with respect to non-proxy access
                                                      12 Proposed ICE Bylaw 2.15(c)(iv).                     nominations.                                            23 17 CFR 229.401(f).
                                                      13 Proposed ICE Bylaw 2.15(c)(v).                        16 17 CFR 240.14n–101.                                24 17 CFR 240.14a–1(l).




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                                                                                     Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices                                           15369

                                                    reference to the exception in Rule 14a–                   nominees to comply with, or any breach                applicable to group members; and (ii)
                                                    (l)(l)(2)(iv) 25) (or any successor rules)                or alleged breach of, its respective                  provided with respect to the persons
                                                    under the Exchange Act in support of                      obligations, agreements or                            specified in Instruction 1 to Items 6(c)
                                                    the election of any individual as a                       representations under Bylaw 2.15; and                 and (d) of Schedule 14N (or any
                                                    director at the applicable annual                            Æ in the event that (1) any                        successor item) in the case of a
                                                    meeting, other than its nominee(s) or                     information included in the Nomination                nominating stockholder or group
                                                    any nominee of the ICE Board;                             Notice or any other communication by                  member that is an entity. A Nomination
                                                       Æ a representation and warranty that                   the nominating stockholder (including                 Notice would be deemed submitted on
                                                    the nominating stockholder will not use                   with respect to any group member) with                the date on which all of the information
                                                    any proxy card other than ICE’s proxy                     ICE, its stockholders or any other person             and documents required by ICE Bylaw
                                                    card in soliciting stockholders in                        in connection with the nomination or                  2.15 (other than such information and
                                                    connection with the election of a                         election of a nominee ceases to be true               documents contemplated to be provided
                                                    nominee at the annual meeting;                            and accurate in all material respects (or             after the date the Nomination Notice is
                                                       Æ if desired, a statement in support of                omits a material fact necessary to make               provided) have been delivered to or, if
                                                    the nominee meeting the standards                         the statements made not misleading) or                sent by mail, received by the Secretary
                                                    identified above; and                                     (2) the nominating stockholder                        of ICE.
                                                       Æ in the case of a nomination by a                     (including any group member) has                         Access to ICE’s proxy statement for
                                                    group, the designation by all group                       failed to continue to satisfy the                     stockholder nominations under ICE
                                                    members of one group member that is                       eligibility requirements described in                 Bylaw 2.15(e)(i) would not be available
                                                    authorized to act on behalf of all group                  Bylaw 2.15(c), to promptly (and in any                in any year in which ICE has received
                                                    members with respect to matters                           event within 48 hours of discovering                  advance notice under ICE Bylaw Section
                                                    relating to the nomination, including                     such misstatement, omission or failure)               2.13 that a stockholder intends to
                                                    withdrawal of the nomination;                             notify ICE and any other recipient of                 nominate a director. In addition,
                                                       • an executed agreement, in a form                     such communication of (1) the                         nominations would be disregarded
                                                    deemed satisfactory by the ICE Board,                     misstatement or omission in such                      under ICE Bylaw 2.15(e)(i) if
                                                    pursuant to which the nominating                          previously provided information and of                   • the nominating stockholder or its
                                                    stockholder (including each group                         the information that is required to                   representative fails to appear at the
                                                    member) agrees:                                           correct the misstatement or omission or
                                                       Æ to comply with all applicable laws,                                                                        annual meeting to present the
                                                                                                              (2) of such failure; and                              nomination or withdraws its
                                                    rules and regulations in connection with                     • an executed agreement, in a form
                                                    the nomination, solicitation and                                                                                nomination;
                                                                                                              deemed satisfactory by the ICE Board,
                                                    election of a nominee;                                                                                             • the nomination or election of the
                                                                                                              by the nominee:
                                                       Æ to file any written solicitation or                     Æ to provide to ICE such other                     nominee would be in violation of ICE’s
                                                    other communication with ICE’s                            information and certifications,                       certificate of incorporation or bylaws, or
                                                    stockholders relating to one or more of                   including completion of ICE’s director                applicable law, rule or regulation,
                                                    ICE’s directors or director nominees or                   questionnaire, as it may reasonably                   including those of stock exchanges;
                                                    any stockholder nominee with the                          request;                                                 • the nominee was nominated
                                                    Commission, regardless of whether any                        Æ that the nominee has read and                    pursuant to ICE Bylaw 2.15 at one of the
                                                    such filing is required under any rule or                 agrees, if elected, to serve as a member              past two annual meetings and either
                                                    regulation or whether any exemption                       of the ICE Board, to adhere to ICE’s                  withdrew or became ineligible, or failed
                                                    from filing is available for such                         Corporate Governance Guidelines and                   to receive 20% of the vote;
                                                    materials under any rule or regulation;                   Global Code of Business Conduct and                      • the nominee is, or has within the
                                                       Æ to assume all liability stemming                     any other policies and guidelines                     last three years been, an officer or
                                                    from an action, suit or proceeding                        applicable to directors; and                          director of a competitor of ICE or is a
                                                    concerning any actual or alleged legal or                    Æ that the nominee is not and will not             U.S. Disqualified Person as defined in
                                                    regulatory violation arising out of any                   become a party to (i) any compensatory,               ICE’s certificate of incorporation; or
                                                    communication by the nominating                           payment or other financial agreement,                    • ICE is notified, or the ICE Board
                                                    stockholder or any of its nominees with                   arrangement or understanding with any                 determines, that a nominating
                                                    ICE, its stockholders or any other person                 person or entity other than ICE in                    stockholder has failed to continue to
                                                    in connection with the nomination or                      connection with service or action as a                satisfy the eligibility requirements, any
                                                    election of directors, including, without                 director of ICE that has not been                     of the representations and warranties
                                                    limitation, the Nomination Notice;                        disclosed to ICE, (ii) any agreement,                 made in the Nomination Notice ceases
                                                       Æ to indemnify and hold harmless                       arrangement or understanding with any                 to be true and accurate in all material
                                                    (jointly with all other group members,                    person or entity as to how the nominee                respects (or omits a material fact
                                                    in the case of a group member) ICE and                    would vote or act on any issue or                     necessary to make the statements made
                                                    each of its directors, officers and                       question as a director (a ‘‘Voting                    not misleading), the nominee becomes
                                                    employees individually against any                        Commitment’’) that has not been                       unwilling or unable to serve on the ICE
                                                    liability, loss, damages, expenses or                     disclosed to ICE or (iii) any Voting                  Board or any material violation or
                                                    other costs (including attorneys’ fees)                   Commitment that could reasonably be                   breach occurs of the obligations,
                                                    incurred in connection with any                           expected to limit or interfere with the               agreements, representations or
                                                    threatened or pending action, suit or                     nominee’s ability to comply, if elected               warranties of the nominating
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                                                    proceeding, whether legal,                                as a director of ICE, with its fiduciary              stockholder or the nominee under ICE
                                                    administrative or investigative, against                  duties under applicable law.                          Bylaw Section 2.15.
                                                    ICE or any of its directors, officers or                     ICE Bylaw 2.15 would specify that the                 In addition, Bylaw 2.15(e)(ii) would
                                                    employees arising out of or relating to                   information and documents required to                 permit ICE to omit from its proxy
                                                    a failure or alleged failure of the                       be provided by the nominating                         statement, or supplement or correct, any
                                                    nominating stockholder or any of its                      stockholder must be: (i) Provided with                information, including all or any
                                                                                                              respect to and executed by each group                 portion of the statement in support of
                                                      25 17   CFR 240.14a–1(l)(2)(iv).                        member, in the case of information                    the Nominee included in the


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                                                    15370                            Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices

                                                    Nomination Notice, if the ICE Board                        materials director nominees, the                        up to 90 days (i) as the Commission may
                                                    determines that:                                           proposed rule change strengthens the                    designate if it finds such longer period
                                                       • Such information is not true in all                   corporate governance of the Exchange’s                  to be appropriate and publishes its
                                                    material respects or omits a material                      ultimate parent company and is thus                     reasons for so finding or (ii) as to which
                                                    statement necessary to make the                            consistent with Section 6(b)(1).                        the self-regulatory organization
                                                    statements made not misleading;                              For similar reasons, the Exchange also                consents, the Commission will:
                                                       • Such information directly or                          believes that this filing furthers the                    (A) By order approve or disapprove
                                                    indirectly impugns the character,                          objectives of Section 6(b)(5) of the                    the proposed rule change, or
                                                    integrity or personal reputation of, or                    Exchange Act,28 because the proposed                      (B) institute proceedings to determine
                                                    directly or indirectly makes charges                       rule change would be consistent with                    whether the proposed rule change
                                                    concerning improper, illegal or immoral                    and facilitate a governance and                         should be disapproved.
                                                    conduct or associations, without factual                   regulatory structure that is designed to                IV. Solicitation of Comments
                                                    foundation, with respect to, any person;                   prevent fraudulent and manipulative
                                                    or                                                         acts and practices, to promote just and                   Interested persons are invited to
                                                       • The inclusion of such information                     equitable principles of trade, to foster                submit written data, views and
                                                    in the proxy statement would otherwise                     cooperation and coordination with                       arguments concerning the foregoing,
                                                    violate the federal proxy rules or any                     persons engaged in regulating, clearing,                including whether the proposed rule
                                                    other applicable law, rule or regulation.                  settling, processing information with                   change is consistent with the Act.
                                                                                                               respect to, and facilitating transactions               Comments may be submitted by any of
                                                    Bylaw Section 2.13                                                                                                 the following methods:
                                                                                                               in securities, to remove impediments to,
                                                       The proposed rule change also would                     and perfect the mechanism of a free and                 Electronic Comments
                                                    amend the existing advance notice                          open market and a national market
                                                    provisions in Bylaw 2.13 to extend their                                                                             • Use the Commission’s Internet
                                                                                                               system and, in general, to protect
                                                    application to stockholder nominations                                                                             comment form (http://www.sec.gov/
                                                                                                               investors and the public interest. As
                                                    under the proxy access provision in                                                                                rules/sro.shtml); or
                                                                                                               discussed above, the Exchange believes                    • Send an email to rule-comments@
                                                    Bylaw 2.15.                                                that by expanding the ability of
                                                       • Bylaw 2.13(b) would be amended to                                                                             sec.gov. Please include File Number SR–
                                                                                                               stockholders to nominate directors that                 NYSEMKT–2016–20 on the subject line.
                                                    provide that stockholder nominations                       could constitute a significant percent
                                                    would be subject to inclusion in the ICE                   (20%) of the number of directors                        Paper Comments
                                                    Board’s notice of annual meeting, and                      currently serving on the ICE Board, the                    • Send paper comments in triplicate
                                                    that the timing and notice requirements                    proposed rule change would ensure                       to Secretary, Securities and Exchange
                                                    of the existing advance notice bylaw                       better corporate governance and                         Commission, 100 F Street NE.,
                                                    would not apply to stockholder                             accountability to stockholders, thereby                 Washington, DC 20549–1090.
                                                    nominations, which have different                          protecting investors and the public                     All submissions should refer to File
                                                    timing and notice requirements as                          interest.                                               Number SR–NYSEMKT–2016–20. This
                                                    described above.
                                                       • Bylaw 2.13(d) would be amended to                     B. Self-Regulatory Organization’s                       file number should be included on the
                                                    specify that the definition therein of                     Statement on Burden on Competition                      subject line if email is used. To help the
                                                    ‘‘publicly announced or disclosed’’                                                                                Commission process and review your
                                                                                                                  The Exchange does not believe that
                                                    would also apply in Bylaw 2.15.                                                                                    comments more efficiently, please use
                                                                                                               the proposed rule change will impose
                                                                                                                                                                       only one method. The Commission will
                                                                                                               any burden on competition that is not
                                                    Conforming Changes                                                                                                 post all comments on the Commission’s
                                                                                                               necessary or appropriate in furtherance
                                                      Finally, the Exchange proposes to                                                                                Internet Web site (http://www.sec.gov/
                                                                                                               of the purposes of the Exchange Act.
                                                    make conforming changes to the title of                                                                            rules/sro.shtml). Copies of the
                                                                                                               The proposed rule change is not
                                                    the Bylaws.                                                                                                        submission, all subsequent
                                                                                                               designed to address any competitive
                                                                                                                                                                       amendments, all written statements
                                                    2. Statutory Basis                                         issue in the U.S. or European securities
                                                                                                                                                                       with respect to the proposed rule
                                                                                                               markets or have any impact on
                                                       The Exchange believes that this filing                                                                          change that are filed with the
                                                                                                               competition in those markets; rather,
                                                    is consistent with Section 6(b) of the                                                                             Commission, and all written
                                                                                                               adoption of a proxy access bylaw by ICE
                                                    Exchange Act,26 in general, and Section                                                                            communications relating to the
                                                                                                               is intended to enhance corporate
                                                    6(b)(1) of the Exchange Act,27 in                                                                                  proposed rule change between the
                                                                                                               governance and accountability to
                                                    particular, in that it enables the                                                                                 Commission and any person, other than
                                                                                                               stockholders.
                                                    Exchange to be so organized as to have                                                                             those that may be withheld from the
                                                    the capacity to be able to carry out the                   C. Self-Regulatory Organization’s                       public in accordance with the
                                                    purposes of the Exchange Act and to                        Statement on Comments on the                            provisions of 5 U.S.C. 552, will be
                                                    comply, and to enforce compliance by                       Proposed Rule Change Received From                      available for Web site viewing and
                                                    its exchange members and persons                           Members, Participants, or Others                        printing in the Commission’s Public
                                                    associated with its exchange members,                        No written comments were solicited                    Reference Room, 100 F Street NE.,
                                                    with the provisions of the Exchange Act,                   or received with respect to the proposed                Washington, DC 20549, on official
                                                    the rules and regulations thereunder,                      rule change.                                            business days between the hours of
                                                                                                                                                                       10:00 a.m. and 3:00 p.m. Copies of the
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                                                    and the rules of the Exchange. The
                                                    Exchange believes that, by permitting a                    III. Date of Effectiveness of the                       filing also will be available for
                                                    stockholder, or a group of up to twenty                    Proposed Rule Change and Timing for                     inspection and copying at the principal
                                                    stockholders, of ICE that meet the stated                  Commission Action                                       office of the Exchange. All comments
                                                    requirements to nominate and have                             Within 45 days of the date of                        received will be posted without change;
                                                    included in ICE’s annual meeting proxy                     publication of this notice in the Federal               the Commission does not edit personal
                                                                                                               Register or within such longer period                   identifying information from
                                                      26 15   U.S.C. 78f(b).                                                                                           submissions. You should submit only
                                                      27 15   U.S.C. 78f(b)(1).                                  28 15   U.S.C. 78f(b)(5).                             information that you wish to make


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                                                                                   Federal Register / Vol. 81, No. 55 / Tuesday, March 22, 2016 / Notices                                           15371

                                                    available publicly. All submissions                     statements concerning the purpose of,                  Bylaw Section 2.15
                                                    should refer to File Number SR–                         and basis for, the proposed rule change                  The proposed rule change would add
                                                    NYSEMKT–2016–20 and should be                           and discussed any comments it received                 new Section 2.15 to the ICE Bylaws.
                                                    submitted on or before April 12,2016.                   on the proposed rule change. The text                  Section 2.15 would permit a
                                                      For the Commission, by the Division of                of those statements may be examined at                 stockholder, or group of up to 20
                                                    Trading and Markets, pursuant to delegated              the places specified in Item IV below.                 stockholders, to nominate director
                                                    authority.29                                            The Exchange has prepared summaries,                   nominees for the ICE Board, so long as
                                                    Robert W. Errett,                                       set forth in sections A, B, and C below,               the stockholder(s) have owned at least
                                                    Deputy Secretary.                                       of the most significant parts of such                  three percent of ICE’s outstanding
                                                    [FR Doc. 2016–06364 Filed 3–21–16; 8:45 am]             statements.                                            shares of common stock continuously
                                                    BILLING CODE 8011–01–P                                                                                         for at least three years. The director
                                                                                                            A. Self-Regulatory Organization’s
                                                                                                                                                                   nominees would be included in ICE’s
                                                                                                            Statement of the Purpose of, and                       annual meeting proxy materials. The
                                                    SECURITIES AND EXCHANGE                                 Statutory Basis for, the Proposed Rule                 proposed provision would limit the
                                                    COMMISSION                                              Change                                                 number of proposed director nominees
                                                                                                            1. Purpose                                             to a number equal to twenty percent of
                                                    [Release No. 34–77384; File No. SR–NYSE–
                                                    2016–14]                                                                                                       the number of directors then serving on
                                                                                                              The Exchange proposes to amend and                   the ICE Board (rounded down to the
                                                    Self-Regulatory Organizations; New                      restate the Fifth Amended and Restated                 nearest whole number, but no less than
                                                    York Stock Exchange LLC; Notice of                      Bylaws of ICE (‘‘ICE Bylaws’’). The                    two) provided that the stockholder(s)
                                                    Filing of Proposed Rule Change                          proposed amendments to the ICE                         and nominee(s) satisfy the other
                                                    Amending and Restating the Fifth                        Bylaws would (1) add a new Section                     conditions specified in the ICE Bylaws.
                                                    Amended and Restated Bylaws of the                      2.15 that permits a stockholder, or                      A candidate would be nominated by
                                                    Exchange’s Ultimate Parent Company,                     stockholders, that meet specific                       a nomination notice (‘‘Nomination
                                                    Intercontinental Exchange, Inc., To                     requirements to nominate director                      Notice’’). Subject to satisfaction of the
                                                    Implement Proxy Access                                  nominees for the board of directors of                 conditions of Section 2.15, described
                                                                                                            ICE (‘‘ICE Board’’), provided that the                 below, as determined by the ICE Board,
                                                    March 17, 2016.                                                                                                ICE would include in its proxy
                                                                                                            nominating stockholder(s) and
                                                       Pursuant to Section 19(b)(1) 1 of the                nominee(s) satisfy the proposed                        statement for the next annual meeting of
                                                    Securities Exchange Act of 1934                         requirements, and (2) amend the                        stockholders the following information:
                                                    (‘‘Act’’) 2 and Rule 19b–4 thereunder,3                 advance notice provisions in Section                     • The names of any person or persons
                                                    notice is hereby given that, on March 2,                                                                       nominated for election;
                                                                                                            2.13 to account for proxy access.4
                                                    2016, New York Stock Exchange LLC                                                                                • disclosure about each nominee and
                                                    (‘‘NYSE’’ or the ‘‘Exchange’’) filed with                 ICE owns 100% of the equity interest                 the nominating stockholder required
                                                    the Securities and Exchange                             in Intercontinental Exchange Holdings,                 under the rules of the Commission or
                                                    Commission (‘‘Commission’’) the                         Inc. (‘‘ICE Holdings’’), which in turn                 other applicable law to be included in
                                                    proposed rule change as described in                    owns 100% of the equity interest in                    the proxy statement;
                                                    Items I, II, and III below, which Items                 NYSE Holdings LLC (‘‘NYSE                                • any statement in support of the
                                                    have been prepared by the self-                         Holdings’’). NYSE Holdings owns 100%                   nominee’s (or nominees’, as applicable)
                                                    regulatory organization. The                            of the equity interest of NYSE Group,                  election, subject to a limit of 500 words
                                                    Commission is publishing this notice to                 Inc., which in turn directly owns 100%                 and subject to compliance with Section
                                                    solicit comments on the proposed rule                   of the equity interest of the Exchange                 14 of the Exchange Act 6 and the rules
                                                    change from interested persons.                         and its affiliates NYSE Arca, Inc. and                 thereunder, including Rule 14a–9; 7 and
                                                                                                            NYSE MKT LLC.5                                           • any other information that ICE
                                                    I. Self-Regulatory Organization’s                                                                              management or the ICE Board
                                                    Statement of the Terms of Substance of                    The proposed amendments to the ICE                   determines, in their discretion, to
                                                    the Proposed Rule Change                                Bylaws have been approved by the ICE                   include relating to the nomination of the
                                                                                                            Board, subject to Securities and                       nominee(s), including, without
                                                       The Exchange proposes to amend and
                                                    restate the Fifth Amended and Restated                  Exchange Commission (‘‘Commission’’)                   limitation, any statement in opposition
                                                    Bylaws of the Exchange’s ultimate                       approval. Under Section 11.1 of the ICE                to the nomination.8
                                                    parent company, Intercontinental                        Bylaws, no stockholder approval is                       ICE Bylaw 2.15 would permit
                                                    Exchange, Inc. (‘‘ICE’’), to implement                  required for amendment of the ICE                      stockholder nominees to constitute up
                                                    proxy access. The proposed rule change                  Bylaws. ICE filed a Form 8–K setting                   to twenty percent of the number of
                                                    is available on the Exchange’s Web site                 forth the proposed amendments on                       directors then serving on the ICE Board,
                                                    at www.nyse.com, at the principal office                January 22, 2016 after approval by the                 subject to the following:
                                                    of the Exchange, and at the                             ICE Board, and will file a further Form                  • If twenty percent of the current
                                                    Commission’s Public Reference Room.                     8–K when the amendments are adopted.                   number of directors is not a whole
                                                                                                                                                                   number, the number of permitted
                                                    II. Self-Regulatory Organization’s                        4 In November 2015, the Comptroller of the City      stockholder nominees would be
                                                    Statement of the Purpose of, and                        of New York, on behalf of certain city retirement      rounded down to the nearest whole
                                                    Statutory Basis for, the Proposed Rule                  systems that are stockholders of ICE, requested that
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                                                                                                            ICE include a proxy access proposal in its 2016
                                                                                                                                                                   number, but no less than two.
                                                    Change
                                                                                                            proxy statement. After discussions with the              • The number of permitted
                                                       In its filing with the Commission, the               Comptroller’s office, ICE management determined        stockholder nominees would be further
                                                    self-regulatory organization included                   to recommend the amendment reflected in the            reduced by (a) the number of any
                                                                                                            proposed rule change to the ICE Board and, on that
                                                                                                            basis, the Comptroller’s request was withdrawn.
                                                                                                                                                                   stockholder nominees who are
                                                      29 17 CFR 200.30–3(a)(12).                              5 The Exchange’s affiliates have each submitted
                                                      1 15 U.S.C. 78s(b)(1).                                                                                        6 15 U.S.C. 78n.
                                                                                                            proposed rule changes to propose the changes
                                                      2 15 U.S.C. 78a.                                                                                              7 17 CFR 240.14a–9.
                                                                                                            described in this filing. See SR–NYSEMKT–2016–
                                                      3 17 CFR 240.19b–4.                                   20 and SR–NYSEArca–2016–25.                             8 Proposed ICE Bylaw 2.15(a).




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Document Created: 2018-02-02 15:15:53
Document Modified: 2018-02-02 15:15:53
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 15366 

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