81 FR 69102 - Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing of Proposed Rule Change To Amend the By-Laws of Nasdaq, Inc. To Implement Proxy Access
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 193 (October 5, 2016)
Federal Register Volume 81, Issue 193 (October 5, 2016)
| Page Range | 69102-69109 | |
| FR Document | 2016-24007 |
[Federal Register Volume 81, Number 193 (Wednesday, October 5, 2016)] [Notices] [Pages 69102-69109] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-24007] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78985; File No. SR-ISE-2016-22] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing of Proposed Rule Change To Amend the By-Laws of Nasdaq, Inc. To Implement Proxy Access September 29, 2016. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\, and Rule 19b-4 thereunder,\2\ notice is hereby given that on September 15, 2016, International Securities Exchange, LLC (``ISE'') or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change as described in Items I, II, and III, below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange is filing this proposed rule change with respect to amendments of the By-Laws (the ``By-Laws'') of its parent corporation, Nasdaq, Inc. (``Nasdaq'' or the ``Company''), to implement proxy access. The proposed amendments will be implemented on a date designated by the Company following approval by the Commission. The text of the proposed rule change is available on the Exchange's Web site at www.ise.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the [[Page 69103]] proposed rule change. The text of these 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 aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Background At Nasdaq's 2016 annual meeting held on May 5, 2016, Nasdaq's stockholders considered a stockholder proposal submitted under Rule 14a-8 under the Act.\3\ The proposal, which passed with 73.52% of the votes cast, requested that Nasdaq's Board of Directors (the ``Board'') take steps to implement a ``proxy access'' by-law. Proxy access by-laws allow a stockholder, or group of stockholders, who comply with certain requirements, to nominate candidates for service on a board and have those candidates included in a company's proxy materials. Such provisions allow stockholders to nominate candidates without undertaking the expense of a proxy solicitation. --------------------------------------------------------------------------- \3\ See 17 CFR 240.14a-8, which establishes procedures pursuant to which stockholders of a public company may have their proposals placed alongside management's proposals in the company's proxy materials for presentation to a vote at a meeting of stockholders. --------------------------------------------------------------------------- Following the 2016 annual meeting, the Nominating & Governance Committee (the ``Committee'') of the Board and the Board reviewed the voting results on the stockholder proposal and discussed proxy access generally. The Committee ultimately recommended to the Board, and the Board approved, certain changes to Nasdaq's By-Laws to implement proxy access. Nasdaq now proposes to make these changes by adopting new Section 3.6 of the By-Laws and making certain conforming changes to current Sections 3.1, 3.3 and 3.5 of the By-Laws, all of which are described further below. In developing its proposal, Nasdaq has generally tried to balance the relative weight of arguments for and against proxy access provisions. On the one hand, Nasdaq recognizes the significance of this issue to some investors, who see proxy access as an important accountability mechanism that allows them to participate in board elections through the nomination of stockholder candidates that are presented in a company's proxy statement. On the other hand, Nasdaq's proposed proxy access provision includes certain procedural requirements that ensure, among other things, that the Company and its stockholders will have full and accurate information about nominating stockholders and their nominees and that such stockholders and nominees will comply with applicable laws, regulations and other requirements. Proposed Section 3.6(a) of the By-Laws To respond to feedback from its stockholders, Nasdaq proposes to amend its By-Laws to, as set forth in the first sentence of proposed Section 3.6(a), require the Company to include in its proxy statement, its form proxy and any ballot distributed at the stockholder meeting, the name of, and certain Required Information \4\ about, any person nominated for election (the ``Stockholder Nominee'') to the Board by a stockholder or group of stockholders (the ``Eligible Stockholder'') \5\ that satisfies the requirements set forth in the proxy access provision of Nasdaq's By-Laws.\6\ To utilize this provision, the Eligible Stockholder must expressly elect at the time of providing a required notice to the Company of the proxy access nomination (the ``Notice of Proxy Access Nomination'') to have its nominee included in the Company's proxy materials. Stockholders will be eligible to submit proxy access nominations only at annual meetings of stockholders when the Board solicits proxies with respect to the election of directors. --------------------------------------------------------------------------- \4\ The Required Information is the information provided to Nasdaq's Corporate Secretary about the Stockholder Nominee and the Eligible Stockholder that is required to be disclosed in the Company's proxy statement by the regulations promulgated under the Act, and if the Eligible Stockholder so elects, a written statement, not to exceed 500 words, in support of the Stockholder Nominee(s)' candidacy (the ``Statement''). \5\ As used throughout Nasdaq's By-Laws, the term ``Eligible Stockholder'' includes each member of a stockholder group that submits a proxy access nomination to the extent the context requires. \6\ When the Company includes proxy access nominees in the proxy materials, such individuals will be included in addition to any persons nominated for election to the Board or any committee thereof. --------------------------------------------------------------------------- The next two sentences of Section 3.6(a) provide some additional clarification on the term ``Eligible Stockholder.'' First, in calculating the number of stockholders in a group seeking to qualify as an Eligible Stockholder, two or more of the following types of funds shall be counted as one stockholder: (i) funds under common management and investment control, (ii) funds under common management and funded primarily by the same employer, or (iii) funds that are a ``group of investment companies'' as such term is defined in Section 12(d)(1)(G)(ii) of the Investment Company Act of 1940, as amended.\7\ Nasdaq views this as a stockholder-friendly provision that will make it easier for such funds to participate in a proxy access nomination since they will not have to comply with the procedural requirements in the proxy access provision multiple times. Second, in the event that the Eligible Stockholder consists of a group of stockholders, any and all requirements and obligations for an individual Eligible Stockholder shall apply to each member of the group, except that the Required Ownership Percentage (discussed further below) shall apply to the ownership of the group in the aggregate. Generally, the applicable requirements and obligations relate to information that each member of the nominating group must provide to Nasdaq about itself, as discussed further below. Nasdaq believes it is reasonable to require each member of the nominating group to provide such information so that both the Company and its stockholders are fully informed about the entire group making the proxy access nomination. --------------------------------------------------------------------------- \7\ See 15 U.S.C. 80a-12(d)(1)(G)(ii), which defines ``group of investment companies'' as any two or more registered investment companies that hold themselves out to investors as related companies for purposes of investment and investor services. --------------------------------------------------------------------------- The final sentence of proposed Section 3.6(a) allows Nasdaq to omit from its proxy materials any information or Statement (or portion thereof) that it, in good faith, believes is untrue in any material respect (or omits to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading) or would violate any applicable law or regulation. This provision allows Nasdaq to comply with Rule 14a-9 under the Act \8\ and to protect its stockholders from information that is materially untrue or that violates any law or regulation. The final sentence of proposed Section 3.6(a) also explicitly allows Nasdaq to solicit against, and include in the proxy statement its own statement relating to, any Stockholder Nominee. This provision merely clarifies that just because Nasdaq must include a proxy access nominee in its proxy materials if the proxy access provisions are [[Page 69104]] satisfied, Nasdaq does not necessarily have to support that nominee. --------------------------------------------------------------------------- \8\ See 17 CFR 240.14a-9, which generally prohibits proxy solicitations that contain any statement which, at the time and in the light of the circumstances under which it is made, is false or misleading with respect to any material fact, or which omits to state any material fact necessary in order to make the statements therein not false or misleading. --------------------------------------------------------------------------- Proposed Section 3.6(b) of the By-Laws Proposed Section 3.6(b) of the By-Laws establishes the deadline for a timely Notice of Proxy Access Nomination. Specifically, such a notice must be addressed to, and received by, Nasdaq's Corporate Secretary no earlier than one hundred fifty (150) days and no later than one hundred twenty (120) days before the anniversary of the date that Nasdaq issued its proxy statement for the previous year's annual meeting of stockholders. The Company believes this notice period will provide stockholders an adequate window to submit nominees via proxy access, while also providing the Company adequate time to diligence [sic] a proxy access nominee before including them in the proxy statement for the next annual meeting of stockholders. Proposed Section 3.6(c) of the By-Laws Proposed Section 3.6(c) specifies that the maximum number of Stockholder Nominees nominated by all Eligible Stockholders that will be included in Nasdaq's proxy materials with respect to an annual meeting of stockholders shall not exceed the greater of two and 25% of the total number of directors in office (rounded down to the nearest whole number) as of the last day on which a Notice of Proxy Access Nomination may be delivered pursuant to and in accordance with the proxy access provision of the By-Laws (the ``Final Proxy Access Nomination Date''). In the event that one or more vacancies for any reason occurs after the Final Proxy Access Nomination Date but before the date of the annual meeting and the Board resolves to reduce the size of the Board in connection therewith, the maximum number of Stockholder Nominees included in Nasdaq's proxy materials shall be calculated based on the number of directors in office as so reduced. Any individual nominated by an Eligible Stockholder for inclusion in the proxy materials pursuant to the proxy access provision of the By- Laws whom the Board decides to nominate as a nominee of the Board, and any individual nominated by an Eligible Stockholder for inclusion in the proxy materials pursuant to the proxy access provision but whose nomination is subsequently withdrawn, shall be counted as one of the Stockholder Nominees for purposes of determining when the maximum number of Stockholder Nominees has been reached. Any Eligible Stockholder submitting more than one Stockholder Nominee for inclusion in the proxy materials shall rank such Stockholder Nominees based on the order that the Eligible Stockholder desires such Stockholder Nominees to be selected for inclusion in the proxy statement in the event that the total number of Stockholder Nominees submitted by Eligible Stockholders pursuant to the proxy access provision exceeds the maximum number of nominees allowed. In the event that the number of Stockholder Nominees submitted by Eligible Stockholders exceeds the maximum number of nominees allowed, the highest ranking Stockholder Nominee who meets the requirements of the proxy access provision of the By-Laws from each Eligible Stockholder will be selected for inclusion in the proxy materials until the maximum number is reached, going in order of the amount (largest to smallest) of shares of Nasdaq's outstanding common stock each Eligible Stockholder disclosed as owned in its respective Notice of Proxy Access Nomination submitted to Nasdaq. If the maximum number is not reached after the highest ranking Stockholder Nominee who meets the requirements of the proxy access provision of the By-Laws from each Eligible Stockholder has been selected, this process will continue as many times as necessary, following the same order each time, until the maximum number is reached. Following such determination, if any Stockholder Nominee who satisfies the eligibility requirements thereafter is nominated by the Board, or is not included in the proxy materials or is not submitted for election as a director, in either case, as a result of the Eligible Stockholder becoming ineligible or withdrawing its nomination, the Stockholder Nominee becoming unwilling or unable to serve on the Board or the Eligible Stockholder or the Stockholder Nominee failing to comply with the proxy access provision of the By-Laws, no other nominee or nominees shall be included in the proxy materials or otherwise submitted for director election in substitution thereof. The Company believes it is reasonable to limit the Board seats available to proxy access nominees, to establish procedures for selecting candidates if the nominee limit is exceeded and to exclude further proxy access nominees in the cases set forth above. The limitation on Board seats available to proxy access nominees ensures that proxy access cannot be used to take over the entire Board, which is not the stated purpose of proxy access campaigns. The procedures for selecting candidates if the nominee limit is exceeded establish clear and rational guidelines for an orderly nomination process to avoid the Company having to make arbitrary judgments among candidates. Finally, the exclusion of further proxy access nominees in certain cases will avoid further time and expense to the Company when the proxy access nominee has been nominated by the Board, in which case the goal of the proxy access nomination has been achieved, or in certain cases when the Eligible Stockholder or Stockholder Nominee is at fault. Proposed Section 3.6(d) of the By-Laws Proposed Section 3.6(d) clarifies, for the avoidance of doubt, how ``ownership'' will be defined for purposes of meeting the Required Ownership Percentage (discussed further below). Specifically, an Eligible Stockholder shall be deemed to ``own'' only those outstanding shares of Nasdaq's common stock as to which the stockholder possesses both: (i) The full voting and investment rights pertaining to the shares; and (ii) the full economic interest in (including the opportunity for profit from and risk of loss on) such shares; provided that the number of shares calculated in accordance with clauses (i) and (ii) shall not include any shares:Sold by such stockholder or any of its affiliates in any transaction that has not been settled or closed, including any short sale; borrowed by such stockholder or any of its affiliates for any purposes or purchased by such stockholder or any of its affiliates pursuant to an agreement to resell; or subject to any option, warrant, forward contract, swap, contract of sale, other derivative or similar agreement entered into by such stockholder or any of its affiliates, whether any such instrument or agreement is to be settled with shares or with cash based on the notional amount or value of shares of Nasdaq's outstanding common stock, in any such case which instrument or agreement has, or is intended to have, or if exercised by either party would have, the purpose or effect of: [cir] Reducing in any manner, to any extent or at any time in the future, such stockholder's or its affiliates' full right to vote or direct the voting of any such shares; and/or [cir] hedging, offsetting or altering to any degree any gain or loss realized or realizable from maintaining the full economic ownership of such shares by such stockholder or its affiliates. Further, a stockholder shall ``own'' shares held in the name of a nominee or other intermediary so long as the stockholder retains the right to instruct [[Page 69105]] how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares. A stockholder's ownership of shares shall be deemed to continue during any period in which the stockholder has delegated any voting power by means of a proxy, power of attorney or other instrument or arrangement which is revocable at any time by the stockholder. A stockholder's ownership of shares shall be deemed to continue during any period in which the stockholder has loaned such shares provided that the stockholder has the power to recall such loaned shares on three (3) business days' notice, has recalled such loaned shares as of the date of the Notice of Proxy Access Nomination and holds such shares through the date of the annual meeting. The terms ``owned,'' ``owning'' and other variations of the word ``own'' shall have correlative meanings. Whether outstanding shares of Nasdaq's common stock are ``owned'' for these purposes shall be determined by the Board or any committee thereof, in each case, in its sole discretion. For purposes of the proxy access provision of the By-Laws, the term ``affiliate'' or ``affiliates'' shall have the meaning ascribed thereto under the rules and regulations of the Act.\9\ An Eligible Stockholder shall include in its Notice of Proxy Access Nomination the number of shares it is deemed to own for the purposes of the proxy access provision of the By-Laws. --------------------------------------------------------------------------- \9\ Pursuant to Rule 12b-2 under the Act, ``[a]n `affiliate' of, or a person `affiliated' with, a specified person, is a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified.'' 17 CFR 240.12b-2. Further, ``[t]he term `control' (including the terms `controlling,' `controlled by' and `under common control with') means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.'' 17 CFR 240.12b-2. --------------------------------------------------------------------------- Proposed Section 3.6(e) of the By-Laws The first paragraph of proposed Section 3.6(e) establishes certain requirements for an Eligible Stockholder to make a proxy access nomination. Specifically, an Eligible Stockholder must have owned (defined as discussed above) 3% or more (the ``Required Ownership Percentage'') of Nasdaq's outstanding common stock (the ``Required Shares'') continuously for 3 years (the ``Minimum Holding Period'') as of both the date the Notice of Proxy Access Nomination is received by Nasdaq's Corporate Secretary and the record date for determining the stockholders entitled to vote at the annual meeting and must continue to own the Required Shares through the meeting date. Proposed Section 3.6(e) also sets forth the information that an Eligible Stockholder must provide to Nasdaq's Corporate Secretary in writing within the deadline discussed above in order to make a proxy access nomination. This information includes: One or more written statements from the record holder of the shares (and from each intermediary through which the shares are or have been held during the Minimum Holding Period) verifying that, as of a date within seven calendar days prior to the date the Notice of Proxy Access Nomination is delivered to, or mailed to and received by, Nasdaq's Corporate Secretary, the Eligible Stockholder owns, and has owned continuously for the Minimum Holding Period, the Required Shares, and the Eligible Stockholder's agreement to provide, within five (5) business days after the record date for the annual meeting, written statements from the record holder and intermediaries verifying the Eligible Stockholder's continuous ownership of the Required Shares through the record date; \10\ --------------------------------------------------------------------------- \10\ See proposed Section 3.6(e)(i) of the By-Laws. --------------------------------------------------------------------------- a copy of the Schedule 14N that has been filed with the SEC as required by Rule 14a-18 under the Act; \11\ --------------------------------------------------------------------------- \11\ See proposed Section 3.6(e)(ii) of the By-Laws; see also 17 CFR 240.14n-101 and 17 CFR 240.14a-18, which generally require a Nominating Stockholder to provide notice to the Company of its intent to submit a proxy access nomination on a Schedule 14N and file that notice, including the required disclosure, with the Commission on the date first transmitted to the Company. --------------------------------------------------------------------------- the information, representations and agreements with respect to the Eligible Stockholder that are the same as those that would be required to be set forth in a stockholder's notice of nomination with respect to a ``Proposing Person'' pursuant to Section 3.1(b)(i) and Section 3.1(b)(iii) of the By-Laws; \12\ --------------------------------------------------------------------------- \12\ See proposed Section 3.6(e)(iii) of the By-Laws; see also Sections 3.1(b)(i) and 3.1(b)(iii) of the By-Laws, which constitute part of Nasdaq's ``advance notice'' provision under which a ``Proposing Person'' may, among other things, nominate a person for election to the Board. --------------------------------------------------------------------------- the consent of each Stockholder Nominee to being named in the proxy statement as a nominee and to serving as a director if elected; \13\ --------------------------------------------------------------------------- \13\ See proposed Section 3.6(e)(iv) of the By-Laws. --------------------------------------------------------------------------- a representation that the Eligible Stockholder: [cir] Acquired the Required Shares in the ordinary course of business and not with the intent to change or influence control of Nasdaq, and does not presently have such intent; \14\ --------------------------------------------------------------------------- \14\ See proposed Section 3.6(e)(v)(A) of the By-Laws. --------------------------------------------------------------------------- [cir] presently intends to maintain qualifying ownership of the Required Shares through the date of the annual meeting; \15\ --------------------------------------------------------------------------- \15\ See proposed Section 3.6(e)(v)(B) of the By-Laws. --------------------------------------------------------------------------- [cir] has not nominated and will not nominate for election any individual as a director at the annual meeting, other than its Stockholder Nominee(s); \16\ --------------------------------------------------------------------------- \16\ See proposed Section 3.6(e)(v)(C) of the By-Laws. --------------------------------------------------------------------------- [cir] has not engaged and will not engage in, and has not and will not be a participant in another person's, ``solicitation'' within the meaning of Rule 14a-1(l) under the Act in support of the election of any individual as a director at the annual meeting, other than its Stockholder Nominee(s) or a nominee of the Board; \17\ --------------------------------------------------------------------------- \17\ See proposed Section 3.6(e)(v)(D) of the By-Laws; see also 17 CFR 240.14a-1(l), which defines the related terms ``solicit'' and ``solicitation.'' --------------------------------------------------------------------------- [cir] agrees to comply with all applicable laws and regulations with respect to any solicitation in connection with the meeting or applicable to the filing and use, if any, of soliciting material; \18\ --------------------------------------------------------------------------- \18\ See proposed Section 3.6(e)(v)(E) of the By-Laws. --------------------------------------------------------------------------- [cir] will provide facts, statements and other information in all communications with Nasdaq and its stockholders that are or will be true and correct in all material respects and do not and will not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; \19\ and --------------------------------------------------------------------------- \19\ See proposed Section 3.6(e)(v)(F) of the By-Laws. --------------------------------------------------------------------------- [cir] as to any two or more funds whose shares are aggregated to count as one stockholder for the purpose of constituting an Eligible Stockholder, within five business days after the date of the Notice of Proxy Access Nomination, will provide to Nasdaq documentation reasonably satisfactory to Nasdaq that demonstrates that the funds satisfy the requirements in the By-Laws, which were discussed above, for the funds to qualify as one Eligible Stockholder; \20\ --------------------------------------------------------------------------- \20\ See proposed Section 3.6(e)(v)(G) of the By-Laws. --------------------------------------------------------------------------- a representation as to the Eligible Stockholder's intentions with respect to maintaining qualifying ownership of the Required Shares for at least one year following the annual meeting; \21\ --------------------------------------------------------------------------- \21\ See proposed Section 3.6(e)(vi) of the By-Laws. --------------------------------------------------------------------------- [[Page 69106]] an undertaking that the Eligible Stockholder agrees to: [cir] Assume all liability stemming from any legal or regulatory violation arising out of the Eligible Stockholder's communications with Nasdaq's stockholders or out of the information that the Eligible Stockholder provided to Nasdaq; \22\ --------------------------------------------------------------------------- \22\ See proposed Section 3.6(e)(vii)(A) of the By-Laws. --------------------------------------------------------------------------- [cir] indemnify and hold harmless Nasdaq and each of its directors, officers and employees individually against any liability, loss or damages in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against Nasdaq or any of its directors, officers or employees arising out of any nomination submitted by the Eligible Stockholder pursuant to the proxy access provision; \23\ and --------------------------------------------------------------------------- \23\ See proposed Section 3.6(e)(vii)(B) of the By-Laws. --------------------------------------------------------------------------- [cir] file with the SEC any solicitation or other communication with Nasdaq's stockholders relating to the meeting at which the Stockholder Nominee will be nominated, regardless of whether any such filing is required under Regulation 14A of the Act or whether any exemption from filing is available thereunder; \24\ and --------------------------------------------------------------------------- \24\ See proposed Section 3.6(e)(vii)(C) of the By-Laws; see also 17 CFR 240.14a-1--14b-2, which governs solicitations of proxies. --------------------------------------------------------------------------- in the case of a nomination by a group of stockholders that together is an Eligible Stockholder, the designation by all group members of one group member that is authorized to act on behalf of all such members with respect to the nomination and matters related thereto, including withdrawal of the nomination.\25\ --------------------------------------------------------------------------- \25\ See proposed Section 3.6(e)(viii) of the By-Laws. --------------------------------------------------------------------------- In proposing the Required Ownership Percentage and the Minimum Holding Period, Nasdaq seeks to ensure that the Eligible Stockholder has had a sufficient stake in the Company for a sufficient amount of time and is not pursuing a short-term agenda. In proposing the informational requirements for the Eligible Stockholder, Nasdaq's goal is to gather sufficient information about the Eligible Stockholder for both itself and its stockholders. Among other things, this information will ensure that Nasdaq is able to comply with its disclosure and other requirements under applicable law and that Nasdaq, its Board and its stockholders are able to assess the proxy access nomination adequately. Proposed Section 3.6(f) of the By-Laws Proposed Section 3.6(f) establishes the information the Stockholder Nominee must deliver to Nasdaq's Corporate Secretary within the time period specified for delivering the Notice of Proxy Access Nomination. This information includes: The information required with respect to persons whom a stockholder proposes to nominate for election or reelection as a director by Section 3.1(b)(i) of the By-Laws \26\ including, but not limited to, the signed questionnaire, representation and agreement required by Section 3.1(b)(i)(D) of the By-Laws; \27\ and --------------------------------------------------------------------------- \26\ Section 3.1(b)(i) of the By-Laws describes the information that a proposing stockholder must provide about an individual the stockholder proposes to nominate for election or reelection as a director pursuant to the ``advance notice'' provision of the By- Laws. \27\ Section 3.1(b)(i)(D) of the By-Laws requires a completed and signed questionnaire, representation and agreement, each containing certain information, from each individual proposed to be nominated for election or reelection as a director pursuant to the ``advance notice'' provision of the By-Laws. --------------------------------------------------------------------------- a written representation and agreement that such person: [cir] Will act as a representative of all of Nasdaq's stockholders while serving as a director; and [cir] will provide facts, statements and other information in all communications with Nasdaq and its stockholders that are or will be true and correct in all material respects (and shall not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading). In addition, at the request of Nasdaq, the Stockholder Nominee(s) must submit all completed and signed questionnaires required of Nasdaq's directors and officers. Nasdaq may request such additional information as necessary to (y) permit the Board to determine if each Stockholder Nominee satisfies the requirements of the proxy access provision of the By-Laws or if each Stockholder Nominee is independent under the listing standards of The NASDAQ Stock Market, any applicable rules of the SEC and any publicly disclosed standards used by the Board in determining and disclosing the independence of Nasdaq's directors \28\ and/or (z) permit Nasdaq's Corporate Secretary to determine the classification of such nominee as an Industry, Non-Industry, Issuer or Public Director, if applicable, in order to make the certification referenced in Section 4.13(h)(iii) of the By-Laws.\29\ --------------------------------------------------------------------------- \28\ Currently, the independence of Nasdaq's directors is determined pursuant to the definition of ``Independent Director'' in Listing Rule 5605(a)(2) of The NASDAQ Stock Market, under which certain categories of individuals cannot be deemed independent and with respect to other individuals, the Board must make an affirmative determination that such individual has no relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Other independence standards under the SEC rules and the Listing Rules of The NASDAQ Stock Market apply to members of certain of the Board's committees. As detailed below, the Commission notes that, while additional, more stringent independence standards may be adopted by the Board in the future, as of the date of this Notice no such standards have been adopted by the Board. \29\ Section 4.13(h)(iii) of the By-Laws requires Nasdaq's Corporate Secretary to collect from each nominee for director such information as is reasonably necessary to serve as the basis for a determination of the nominee's classification as an Industry, Non- Industry, Issuer, or Public Director, if applicable, and to certify to the Committee each nominee's classification, if applicable. Detailed definitions of the terms ``Industry Director,'' ``Non- Industry Director,'' ``Issuer Director'' and ``Public Director'' are included in Article I of the By-Laws. --------------------------------------------------------------------------- Like the informational requirements for an Eligible Stockholder, which are set forth above, the informational requirements for the Stockholder Nominee ensure that both Nasdaq and its stockholders will have sufficient information about the Stockholder Nominee. Among other things, this information will ensure that Nasdaq is able to comply with its disclosure and other requirements under applicable law and that Nasdaq, its Board and its stockholders are able to assess the proxy access nomination adequately. Proposed Section 3.6(g) of the By-Laws Pursuant to proposed Section 3.6(g), each Eligible Stockholder or Stockholder Nominee must promptly notify Nasdaq's Corporate Secretary of any information or communications provided by the Eligible Stockholder or Stockholder Nominee to Nasdaq or its stockholders that ceases to be true and correct in all material respects or omits a material fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading and of the information that is required to correct any such defect. This provision further states that providing any such notification shall not be deemed to cure any defect or, with respect to any defect that Nasdaq determines is material, limit Nasdaq's rights to omit a Stockholder Nominee from its proxy materials. This provision is intended to protect Nasdaq's stockholders by requiring an Eligible Stockholder or Stockholder Nominee to give Nasdaq notice of information previously provided that is materially untrue. Nasdaq may then decide what action to [[Page 69107]] take with respect to such defect, which may include, with respect to a material defect, omitting the relevant Stockholder Nominee from its proxy materials. Proposed Section 3.6(h) of the By-Laws Proposed Section 3.6(h) provides that Nasdaq shall not be required to include a Stockholder Nominee in its proxy materials for any meeting of stockholders under certain circumstances. In these situations, the proxy access nomination shall be disregarded and no vote on such Stockholder Nominee will occur, even if Nasdaq has received proxies in respect of the vote. These circumstances occur when the Stockholder Nominee: Has been nominated by an Eligible Stockholder who has engaged in or is currently engaged in, or has been or is a participant in another person's, ``solicitation'' within the meaning of Rule 14a- 1(l) under the Act in support of the election of any individual as a director at the annual meeting other than its Stockholder Nominee(s) or a nominee of the Board; \30\ --------------------------------------------------------------------------- \30\ See proposed Section 3.6(h)(i) of the By-Laws; see also 17 CFR 240.14a-1(l), which defines the related terms ``solicit'' and ``solicitation.'' --------------------------------------------------------------------------- is not independent under the listing standards of The NASDAQ Stock Market, any applicable rules of the SEC and any publicly disclosed standards used by the Board in determining and disclosing independence of Nasdaq's directors, in each case as determined by the Board in its sole discretion; \31\ --------------------------------------------------------------------------- \31\ See proposed Section 3.6(h)(ii) of the By-Laws; see also footnote 28, supra. The Commission notes that, while additional, more stringent independence standards may be adopted by the Board in the future, as of the date of this Notice no such standards have been adopted by the Board. The Commission further notes that, according to Nasdaq, should the Board decide to adopt additional, more stringent standards than those required under Nasdaq listing standards and any requirements under Commission rules, all director nominees would be evaluated against these standards--not just those shareholder candidates nominated under the provisions of proposed Section 3.6. --------------------------------------------------------------------------- would, if elected as a member of the Board, cause Nasdaq to be in violation of the By-Laws (including but not limited to the compositional requirements of the Board set forth in Section 4.3 of the By-Laws), its Amended and Restated Certificate of Incorporation, the rules and listing standards of The NASDAQ Stock Market, or any applicable state or federal law, rule or regulation; \32\ --------------------------------------------------------------------------- \32\ See proposed Section 3.6(h)(iii) of the By-Laws; see also Section 4.3 of the By-Laws, which provides that the number of Non- Industry Directors on the Board must equal or exceed the number of Industry Directors. In addition, the Board must include at least two Public Directors and may include at least one, but no more than two, Issuer Directors. Finally, the Board shall include no more than one Staff Director, unless the Board consists of ten or more directors, in which case, the Board shall include no more than two Staff Directors. Detailed definitions of the terms ``Non-Industry Director,'' ``Industry Director,'' ``Public Director,'' ``Issuer Director'' and ``Staff Director'' are included in Article I of the By-Laws. --------------------------------------------------------------------------- is or has been, within the past three (3) years, an officer or director of a competitor, as defined for purposes of Section 8 of the Clayton Antitrust Act of 1914; \33\ --------------------------------------------------------------------------- \33\ See proposed Section 3.6(h)(iv) of the By-Laws; see also 15 U.S.C. 19(a)(1), which generally provides that ``[n]o person shall, at the same time, serve as a director or officer in any two corporations'' that are ``competitors'' such that ``the elimination of competition by agreement between them would constitute a violation of any of the antitrust laws.'' --------------------------------------------------------------------------- is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in such a criminal proceeding within the past ten (10) years; \34\ --------------------------------------------------------------------------- \34\ See proposed Section 3.6(h)(v) of the By-Laws. --------------------------------------------------------------------------- is subject to any order of the type specified in Rule 506(d) of Regulation D promulgated under the Securities Act of 1933, as amended; \35\ --------------------------------------------------------------------------- \35\ See proposed Section 3.6(h)(vi) of the By-Laws; see also 17 CFR 230.506(d), which generally disqualifies offerings involving certain felons and other bad actors from relying on the ``safe harbor'' in Rule 506 of Regulation D from registration under the Securities Act of 1933, as amended. --------------------------------------------------------------------------- is subject to ``statutory disqualification'' under Section 3(a)(39) of the Act; \36\ --------------------------------------------------------------------------- \36\ See proposed Section 3.6(h)(vii) of the By-Laws; see also 15 U.S.C. 78c(a)(39), which disqualifies certain categories of individuals who generally have engaged in misconduct from membership or participation in, or association with a member of, a self- regulatory organization. --------------------------------------------------------------------------- has, or the applicable Eligible Stockholder has, provided information to Nasdaq in respect of the proxy access nomination that was untrue in any material respect or omitted to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading, as determined by the Board or any committee thereof, in each case, in its sole discretion; \37\ or --------------------------------------------------------------------------- \37\ See proposed Section 3.6(h)(viii) of the By-Laws. --------------------------------------------------------------------------- breaches or fails, or the applicable Eligible Stockholder breaches or fails, to comply with its obligations pursuant to the By- Laws, including, but not limited to, the proxy access provisions and any agreement, representation or undertaking required by the proxy access provisions.\38\ --------------------------------------------------------------------------- \38\ See proposed Section 3.6(h)(ix) of the By-Laws. --------------------------------------------------------------------------- Nasdaq believes these provisions will protect the Company and its stockholders by allowing it to exclude certain categories of objectionable Stockholder Nominees from the proxy statement. Proposed Section 3.6(i) of the By-Laws Under proposed Section 3.6(i), the Board or the chairman of the meeting of stockholders shall declare a proxy access nomination invalid, and such nomination shall be disregarded even if proxies in respect of such nomination have been received by the Company, if: The Stockholder Nominee(s) and/or the applicable Eligible Stockholder have breached its or their obligations under the proxy access provision of the By-Laws, as determined by the Board or the chairman of the meeting of stockholders, in each case, in its or his sole discretion; or the Eligible Stockholder (or a qualified representative thereof) does not appear at the meeting of stockholders to present the proxy access nomination. Nasdaq believes this provision protects the Company and its stockholders by providing the Board or the chairman of the stockholder meeting limited authority to disqualify a proxy access nominee when that nominee or the sponsoring stockholder(s) have breached an obligation under the proxy access provision, including the obligation to appear at the stockholder meeting to present the proxy access nomination. Proposed Section 3.6(j) of the By-Laws Proposed Section 3.6(j) states that the following Stockholder Nominees who are included in the Company's proxy materials for a particular annual meeting of stockholders will be ineligible to be a Stockholder Nominee for the next two annual meetings: A Stockholder Nominee who withdraws from or becomes ineligible or unavailable for election at the annual meeting; or a Stockholder Nominee who does not receive at least 25% of the votes cast in favor of such Stockholder Nominee's election. This provision will save the Company and its stockholders the time and expense of analyzing and addressing subsequent proxy access nominations regarding individuals who were included in the proxy materials for a particular annual meeting but ultimately did not stand for election or receive a substantial amount of votes. After the next two annual meetings, these Stockholder Nominees would again be eligible for nomination through the proxy access provisions of the By-Laws. [[Page 69108]] Proposed Section 3.6(k) of the By-Laws In case there are matters involving a proxy access nomination that are open to interpretation, proposed Section 3.6(k) states that the Board (or any other person or body authorized by the Board) shall have exclusive power and authority to interpret the proxy access provisions of the By-Laws and make all determinations deemed necessary or advisable as to any person, facts or circumstances. In addition, all actions, interpretations and determinations of the Board (or any person or body authorized by the Board) with respect to the proxy access provisions shall be final, conclusive and binding on the Company, the stockholders and all other parties. While Nasdaq has attempted to implement a clear, detailed and thorough proxy access provision, there may be matters about future proxy access nominations that are open to interpretation. In these cases, Nasdaq believes it is reasonable and necessary to designate an arbiter to make final decisions on these points and that the Board is best-suited to act as that arbiter. Proposed Section 3.6(l) of the By-Laws Proposed Section 3.6(l) prohibits a stockholder from joining more than one group of stockholders to become an Eligible Stockholder for purposes of submitting a proxy access nomination for each annual meeting of stockholders. Nasdaq analogizes this provision to Article IV, Paragraph C(1) of its Amended and Restated Certificate of Incorporation, under which each holder of Nasdaq's common stock shall be entitled to one vote per share on all matters presented to the stockholders for a vote. Similar to that provision, Nasdaq believes it is reasonable for each share to count only once in submitting a proxy access nomination. Proposed Section 3.6(m) of the By-Laws For the avoidance of doubt, proposed Section 3.6(m) states that the proxy access provisions outlined in Section 3.6 of the By-Laws shall be the exclusive means for stockholders to include nominees in the Company's proxy materials. Stockholders may, of course, continue to propose nominees to the Committee and Board through other means, but the Committee and Board will have final authority to determine whether to include those nominees in the Company's proxy materials. Revisions to Other Sections of the By-Laws Nasdaq also proposes to make conforming changes to Sections 3.1(a), 3.3(a), 3.3(c) and 3.5 of the By-Laws to provide clarifications and prevent confusion. Specifically, current Section 3.1(a) enumerates the methods by which nominations of persons for election to the Board may be made at an annual meeting of stockholders; Nasdaq proposes to add proxy access nominations to the list of methods. Current Section 3.3(a) specifies that, among other things, only such persons who are nominated in accordance with the procedures set forth in Article III of the By- Laws \39\ shall be eligible to be elected at an annual or special meeting of Nasdaq's stockholders to serve as directors; for the avoidance of doubt, Nasdaq proposes to clarify that the reference to Article III includes the proxy access provision in Section 3.6 of the By-Laws with respect to director nominations in connection with annual meetings. Current Section 3.3(c) states, among other things, that compliance with Section 3.1(a)(iii) and (b) \40\ shall be the exclusive means for a stockholder to make a director nomination; Nasdaq proposes to add proxy access as an additional means for a stockholder to make a director nomination. Finally, current Section 3.5 requires Nasdaq's director nominees to submit to Nasdaq's Corporate Secretary a questionnaire, representation and agreement within certain time periods; Nasdaq proposes to clarify that proxy access nominees must submit these materials within the time periods prescribed for delivery of a Notice of Proxy Access Nomination, as described above. --------------------------------------------------------------------------- \39\ Article III of the By-Laws relates to stockholder meetings. \40\ As part of Nasdaq's ``advance notice'' provision, Sections 3.1(a)(iii) and (b) of the By-Laws describe certain procedures that a stockholder must follow to, among other things, nominate a person for election to the Board. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\41\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\42\ in particular, in that it is designed to promote just and equitable principles of trade, 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. --------------------------------------------------------------------------- \41\ 15 U.S.C. 78f(b). \42\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- In response to feedback from its investors, Nasdaq is proposing changes to its By-Laws to implement proxy access. The Exchange believes that, by permitting an Eligible Stockholder of Nasdaq that meets the stated requirements to nominate directors and have its nominees included in Nasdaq's annual meeting proxy statement, the proposed rule change strengthens the corporate governance of the Exchange's ultimate parent company, which is beneficial to both investors and the public interest. In drafting its proxy access provision, Nasdaq has attempted to strike an appropriate balance between responding to investor feedback and including certain procedural and informational requirements for the protection of the Company and its investors. Specifically, the procedural requirements will protect investors by stating clearly and explicitly the procedures stockholders must follow in order to submit a proper proxy access nomination. The informational requirements will enhance investor protection by ensuring, among other things, that the Company and its stockholders have full and accurate information about nominating stockholders and their nominees and that such stockholders and nominees comply with applicable laws, regulations and other requirements. Finally, the remaining changes are clarifying in nature, and they enhance investor protection and the public interest by preventing confusion with respect to the operation of the By-Law provisions. B. Self-Regulatory Organization's Statement on Burden on Competition Because the proposed rule change relates to the governance of the Company and not to the operations of the Exchange, the Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the Exchange consents, the Commission shall: (a) By order approve or disapprove such proposed rule change, or (b) institute proceedings to determine whether the proposed rule change should be disapproved. [[Page 69109]] 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-ISE-2016-22 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-ISE-2016-22. 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 available publicly. All submissions should refer to File Number SR-ISE-2016-22 and should be submitted on or before October 26, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\43\ --------------------------------------------------------------------------- \43\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-24007 Filed 10-4-16; 8:45 am] BILLING CODE 8011-01-P
![69102 Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices
filed for immediate effectiveness including whether the proposed rule For the Commission, by the Division of
because it does not: (i) Significantly change is consistent with the Act. Trading and Markets, pursuant to delegated
affect the protection of investors or the Comments may be submitted by any of Authority.23
public interest; (ii) impose any the following methods: Robert W. Errett,
significant burden on competition; and Deputy Secretary.
(iii) by its terms would not become Electronic Comments [FR Doc. 2016–24005 Filed 10–4–16; 8:45 am]
operative for 30 days after the date of
• Use the Commission’s Internet BILLING CODE 8011–01–P
the filing, or such shorter time as the
comment form (http://www.sec.gov/
Commission may designate.20
Additionally, OCC provided the rules/sro.shtml); or SECURITIES AND EXCHANGE
Commission with written notice of its • Send an email to rule-comments@ COMMISSION
intent to file the proposed rule change, sec.gov. Please include File Number SR–
[Release No. 34–78985; File No. SR–ISE–
along with a brief description and text OCC–2016–010 on the subject line. 2016–22]
of the proposed rule change, at least five
business days prior to the date of filing Paper Comments
Self-Regulatory Organizations;
of the proposed rule change or such • Send paper comments in triplicate International Securities Exchange,
shorter time as designated by the to Brent J. Fields, Secretary, Securities LLC; Notice of Filing of Proposed Rule
Commission. Change To Amend the By-Laws of
and Exchange Commission, 100 F Street
The Commission believes that Nasdaq, Inc. To Implement Proxy
waiving the 30-day operative delay is NE., Washington, DC 20549–1090.
Access
consistent with the protection of All submissions should refer to File
investors and the public interest Number SR–OCC–2016–010. This file September 29, 2016.
because it will allow OCC to implement number should be included on the Pursuant to Section 19(b)(1) of the
the proposed rule change immediately. subject line if email is used. To help the Securities Exchange Act of 1934
As stated by OCC, OCC believes that the Commission process and review your (‘‘Act’’) 1, and Rule 19b–4 thereunder,2
proposed rule change is not intended to comments more efficiently, please use notice is hereby given that on
substantively alter OCC’s governance only one method. The Commission will September 15, 2016, International
arrangements, but is designed to provide post all comments on the Commission’s Securities Exchange, LLC (‘‘ISE’’) or
more clarity and transparency to Internet Web site (http://www.sec.gov/ ‘‘Exchange’’) filed with the Securities
Clearing Members, other users of OCC, and Exchange Commission (‘‘SEC’’ or
rules/sro.shtml). Copies of the
and the general public. Therefore, the ‘‘Commission’’) the proposed rule
submission, all subsequent
Commission hereby waives the 30-day change as described in Items I, II, and
operative delay and designates the amendments, all written statements III, below, which Items have been
proposed rule change operative upon with respect to the proposed rule prepared by the Exchange. The
filing with the Commission.21 change that are filed with the Commission is publishing this notice to
At any time within 60 days of the Commission, and all written solicit comments on the proposed rule
filing of the proposed rule change, the communications relating to the change from interested persons.
Commission summarily may proposed rule change between the
temporarily suspend such rule change if Commission and any person, other than I. Self-Regulatory Organization’s
it appears to the Commission that such those that may be withheld from the Statement of the Terms of Substance of
action is necessary or appropriate in the public in accordance with the the Proposed Rule Change
public interest, for the protection of provisions of 5 U.S.C. 552, will be The Exchange is filing this proposed
investors, or otherwise in furtherance of available for Web site viewing and rule change with respect to amendments
the purposes of the Act.22 printing in the Commission’s Public of the By-Laws (the ‘‘By-Laws’’) of its
Reference Room, 100 F Street NE., parent corporation, Nasdaq, Inc.
IV. Solicitation of Comments
Washington, DC 20549, on official (‘‘Nasdaq’’ or the ‘‘Company’’), to
Interested persons are invited to business days between the hours of implement proxy access. The proposed
submit written data, views and 10:00 a.m. and 3:00 p.m. Copies of such amendments will be implemented on a
arguments concerning the foregoing, date designated by the Company
filing also will be available for
inspection and copying at the principal following approval by the Commission.
20 OCC has requested that the Commission waive
office of OCC and on OCC’s Web site at The text of the proposed rule change is
the 30-day operative delay contained in Rule 19b–
available on the Exchange’s Web site at
4(f)(6)(iii) so that the proposal may become http://www.theocc.com/components/
operative immediately upon filing. As noted herein, www.ise.com, at the principal office of
docs/legal/rules_and_bylaws/sr_occ_16_
the proposed rule change is not intended to the Exchange, and at the Commission’s
substantively alter OCC’s governance arrangements 010.pdf.
Public Reference Room.
but is designed to provide additional clarity All comments received will be posted
regarding OCC’s governance arrangements and
without change; the Commission does II. Self-Regulatory Organization’s
improve the overall readability of OCC’s Certificate Statement of the Purpose of, and
of Incorporation. OCC believes that the prompt not edit personal identifying
implementation of these changes would be Statutory Basis for, the Proposed Rule
information from submissions. You
consistent with the public interest and the Change
protection of investors.
should submit only information that
asabaliauskas on DSK3SPTVN1PROD with NOTICES
21 For purposes only of waiving the 30-day you wish to make available publicly. In its filing with the Commission, the
operative delay, the Commission has also Exchange included statements
All submissions should refer to File
considered the proposed rule’s impact on concerning the purpose of and basis for
efficiency, competition, and capital formation. See Number SR–OCC–2016–010 and should the proposed rule change and discussed
15 U.S.C. 78c(f). be submitted on or before October 26, any comments it received on the
22 Notwithstanding its immediate effectiveness,
2016.
implementation of this rule change will be delayed
23 17 CFR 200.30–3(a)(12).
until this change is deemed certified or otherwise
1 15 U.S.C. 78s(b)(1).
appropriately filed as a Weekly Notification of Rule
Amendments under CFTC Regulation § 40.6. 2 17 CFR 240.19b–4.
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![69104 Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices
satisfied, Nasdaq does not necessarily inclusion in the proxy materials shall orderly nomination process to avoid the
have to support that nominee. rank such Stockholder Nominees based Company having to make arbitrary
on the order that the Eligible judgments among candidates. Finally,
Proposed Section 3.6(b) of the By-Laws
Stockholder desires such Stockholder the exclusion of further proxy access
Proposed Section 3.6(b) of the By- Nominees to be selected for inclusion in nominees in certain cases will avoid
Laws establishes the deadline for a the proxy statement in the event that the further time and expense to the
timely Notice of Proxy Access total number of Stockholder Nominees Company when the proxy access
Nomination. Specifically, such a notice submitted by Eligible Stockholders nominee has been nominated by the
must be addressed to, and received by, pursuant to the proxy access provision Board, in which case the goal of the
Nasdaq’s Corporate Secretary no earlier exceeds the maximum number of proxy access nomination has been
than one hundred fifty (150) days and nominees allowed. In the event that the achieved, or in certain cases when the
no later than one hundred twenty (120) number of Stockholder Nominees Eligible Stockholder or Stockholder
days before the anniversary of the date submitted by Eligible Stockholders Nominee is at fault.
that Nasdaq issued its proxy statement exceeds the maximum number of
for the previous year’s annual meeting Proposed Section 3.6(d) of the By-Laws
nominees allowed, the highest ranking
of stockholders. The Company believes Stockholder Nominee who meets the Proposed Section 3.6(d) clarifies, for
this notice period will provide requirements of the proxy access the avoidance of doubt, how
stockholders an adequate window to provision of the By-Laws from each ‘‘ownership’’ will be defined for
submit nominees via proxy access, Eligible Stockholder will be selected for purposes of meeting the Required
while also providing the Company inclusion in the proxy materials until Ownership Percentage (discussed
adequate time to diligence [sic] a proxy the maximum number is reached, going further below). Specifically, an Eligible
access nominee before including them in order of the amount (largest to Stockholder shall be deemed to ‘‘own’’
in the proxy statement for the next smallest) of shares of Nasdaq’s only those outstanding shares of
annual meeting of stockholders. outstanding common stock each Eligible Nasdaq’s common stock as to which the
Proposed Section 3.6(c) of the By-Laws Stockholder disclosed as owned in its stockholder possesses both: (i) The full
respective Notice of Proxy Access voting and investment rights pertaining
Proposed Section 3.6(c) specifies that to the shares; and (ii) the full economic
the maximum number of Stockholder Nomination submitted to Nasdaq. If the
maximum number is not reached after interest in (including the opportunity
Nominees nominated by all Eligible for profit from and risk of loss on) such
Stockholders that will be included in the highest ranking Stockholder
Nominee who meets the requirements of shares; provided that the number of
Nasdaq’s proxy materials with respect to shares calculated in accordance with
an annual meeting of stockholders shall the proxy access provision of the By-
Laws from each Eligible Stockholder has clauses (i) and (ii) shall not include any
not exceed the greater of two and 25% shares:
of the total number of directors in office been selected, this process will continue
as many times as necessary, following • Sold by such stockholder or any of
(rounded down to the nearest whole its affiliates in any transaction that has
number) as of the last day on which a the same order each time, until the
maximum number is reached. Following not been settled or closed, including any
Notice of Proxy Access Nomination may short sale;
such determination, if any Stockholder
be delivered pursuant to and in • borrowed by such stockholder or
accordance with the proxy access Nominee who satisfies the eligibility
any of its affiliates for any purposes or
provision of the By-Laws (the ‘‘Final requirements thereafter is nominated by
purchased by such stockholder or any of
Proxy Access Nomination Date’’). In the the Board, or is not included in the
its affiliates pursuant to an agreement to
event that one or more vacancies for any proxy materials or is not submitted for
resell; or
reason occurs after the Final Proxy election as a director, in either case, as • subject to any option, warrant,
Access Nomination Date but before the a result of the Eligible Stockholder forward contract, swap, contract of sale,
date of the annual meeting and the becoming ineligible or withdrawing its other derivative or similar agreement
Board resolves to reduce the size of the nomination, the Stockholder Nominee entered into by such stockholder or any
Board in connection therewith, the becoming unwilling or unable to serve of its affiliates, whether any such
maximum number of Stockholder on the Board or the Eligible Stockholder instrument or agreement is to be settled
Nominees included in Nasdaq’s proxy or the Stockholder Nominee failing to with shares or with cash based on the
materials shall be calculated based on comply with the proxy access provision notional amount or value of shares of
the number of directors in office as so of the By-Laws, no other nominee or Nasdaq’s outstanding common stock, in
reduced. Any individual nominated by nominees shall be included in the proxy any such case which instrument or
an Eligible Stockholder for inclusion in materials or otherwise submitted for agreement has, or is intended to have,
the proxy materials pursuant to the director election in substitution thereof. or if exercised by either party would
proxy access provision of the By-Laws The Company believes it is reasonable have, the purpose or effect of:
whom the Board decides to nominate as to limit the Board seats available to Æ Reducing in any manner, to any
a nominee of the Board, and any proxy access nominees, to establish extent or at any time in the future, such
individual nominated by an Eligible procedures for selecting candidates if stockholder’s or its affiliates’ full right
Stockholder for inclusion in the proxy the nominee limit is exceeded and to to vote or direct the voting of any such
materials pursuant to the proxy access exclude further proxy access nominees shares; and/or
provision but whose nomination is in the cases set forth above. The Æ hedging, offsetting or altering to
asabaliauskas on DSK3SPTVN1PROD with NOTICES
subsequently withdrawn, shall be limitation on Board seats available to any degree any gain or loss realized or
counted as one of the Stockholder proxy access nominees ensures that realizable from maintaining the full
Nominees for purposes of determining proxy access cannot be used to take over economic ownership of such shares by
when the maximum number of the entire Board, which is not the stated such stockholder or its affiliates.
Stockholder Nominees has been purpose of proxy access campaigns. The Further, a stockholder shall ‘‘own’’
reached. procedures for selecting candidates if shares held in the name of a nominee
Any Eligible Stockholder submitting the nominee limit is exceeded establish or other intermediary so long as the
more than one Stockholder Nominee for clear and rational guidelines for an stockholder retains the right to instruct
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![Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices 69105
how the shares are voted with respect to annual meeting and must continue to control of Nasdaq, and does not
the election of directors and possesses own the Required Shares through the presently have such intent; 14
the full economic interest in the shares. meeting date. Æ presently intends to maintain
A stockholder’s ownership of shares Proposed Section 3.6(e) also sets forth qualifying ownership of the Required
shall be deemed to continue during any the information that an Eligible Shares through the date of the annual
period in which the stockholder has Stockholder must provide to Nasdaq’s meeting; 15
delegated any voting power by means of Corporate Secretary in writing within Æ has not nominated and will not
a proxy, power of attorney or other the deadline discussed above in order to nominate for election any individual as
instrument or arrangement which is make a proxy access nomination. This a director at the annual meeting, other
revocable at any time by the information includes: than its Stockholder Nominee(s); 16
stockholder. A stockholder’s ownership Æ has not engaged and will not
• One or more written statements
of shares shall be deemed to continue engage in, and has not and will not be
from the record holder of the shares
during any period in which the a participant in another person’s,
(and from each intermediary through
stockholder has loaned such shares ‘‘solicitation’’ within the meaning of
which the shares are or have been held
provided that the stockholder has the Rule 14a–1(l) under the Act in support
during the Minimum Holding Period)
power to recall such loaned shares on of the election of any individual as a
verifying that, as of a date within seven
three (3) business days’ notice, has director at the annual meeting, other
calendar days prior to the date the
recalled such loaned shares as of the than its Stockholder Nominee(s) or a
Notice of Proxy Access Nomination is
date of the Notice of Proxy Access nominee of the Board; 17
delivered to, or mailed to and received
Nomination and holds such shares Æ agrees to comply with all
by, Nasdaq’s Corporate Secretary, the
through the date of the annual meeting. applicable laws and regulations with
Eligible Stockholder owns, and has
The terms ‘‘owned,’’ ‘‘owning’’ and respect to any solicitation in connection
owned continuously for the Minimum
other variations of the word ‘‘own’’ shall with the meeting or applicable to the
Holding Period, the Required Shares,
have correlative meanings. Whether filing and use, if any, of soliciting
and the Eligible Stockholder’s
outstanding shares of Nasdaq’s common material; 18
agreement to provide, within five (5)
stock are ‘‘owned’’ for these purposes Æ will provide facts, statements and
business days after the record date for
shall be determined by the Board or any other information in all
the annual meeting, written statements
committee thereof, in each case, in its communications with Nasdaq and its
from the record holder and
sole discretion. For purposes of the stockholders that are or will be true and
intermediaries verifying the Eligible
proxy access provision of the By-Laws, correct in all material respects and do
Stockholder’s continuous ownership of
the term ‘‘affiliate’’ or ‘‘affiliates’’ shall not and will not omit to state a material
the Required Shares through the record
have the meaning ascribed thereto fact necessary in order to make the
date; 10
under the rules and regulations of the statements made, in light of the
Act.9 An Eligible Stockholder shall • a copy of the Schedule 14N that has
circumstances under which they were
include in its Notice of Proxy Access been filed with the SEC as required by
made, not misleading; 19 and
Nomination the number of shares it is Rule 14a–18 under the Act; 11
Æ as to any two or more funds whose
deemed to own for the purposes of the • the information, representations shares are aggregated to count as one
proxy access provision of the By-Laws. and agreements with respect to the stockholder for the purpose of
Eligible Stockholder that are the same as constituting an Eligible Stockholder,
Proposed Section 3.6(e) of the By-Laws
those that would be required to be set within five business days after the date
The first paragraph of proposed forth in a stockholder’s notice of of the Notice of Proxy Access
Section 3.6(e) establishes certain nomination with respect to a ‘‘Proposing Nomination, will provide to Nasdaq
requirements for an Eligible Stockholder Person’’ pursuant to Section 3.1(b)(i) documentation reasonably satisfactory
to make a proxy access nomination. and Section 3.1(b)(iii) of the By-Laws; 12 to Nasdaq that demonstrates that the
Specifically, an Eligible Stockholder • the consent of each Stockholder funds satisfy the requirements in the By-
must have owned (defined as discussed Nominee to being named in the proxy Laws, which were discussed above, for
above) 3% or more (the ‘‘Required statement as a nominee and to serving the funds to qualify as one Eligible
Ownership Percentage’’) of Nasdaq’s as a director if elected; 13 Stockholder; 20
outstanding common stock (the
• a representation that the Eligible • a representation as to the Eligible
‘‘Required Shares’’) continuously for 3
Stockholder: Stockholder’s intentions with respect to
years (the ‘‘Minimum Holding Period’’)
Æ Acquired the Required Shares in maintaining qualifying ownership of the
as of both the date the Notice of Proxy
the ordinary course of business and not Required Shares for at least one year
Access Nomination is received by
with the intent to change or influence following the annual meeting; 21
Nasdaq’s Corporate Secretary and the
record date for determining the 14 See proposed Section 3.6(e)(v)(A) of the By-
stockholders entitled to vote at the 10 See proposed Section 3.6(e)(i) of the By-Laws.
Laws.
11 See proposed Section 3.6(e)(ii) of the By-Laws; 15 See proposed Section 3.6(e)(v)(B) of the By-
9 Pursuant to Rule 12b–2 under the Act, ‘‘[a]n see also 17 CFR 240.14n–101 and 17 CFR 240.14a–
Laws.
‘affiliate’ of, or a person ‘affiliated’ with, a specified 18, which generally require a Nominating 16 See proposed Section 3.6(e)(v)(C) of the By-
person, is a person that directly, or indirectly Stockholder to provide notice to the Company of its
intent to submit a proxy access nomination on a Laws.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
through one or more intermediaries, controls, or is 17 See proposed Section 3.6(e)(v)(D) of the By-
controlled by, or is under common control with, the Schedule 14N and file that notice, including the
required disclosure, with the Commission on the Laws; see also 17 CFR 240.14a–1(l), which defines
person specified.’’ 17 CFR 240.12b–2. Further,
date first transmitted to the Company. the related terms ‘‘solicit’’ and ‘‘solicitation.’’
‘‘[t]he term ‘control’ (including the terms 18 See proposed Section 3.6(e)(v)(E) of the By-
12 See proposed Section 3.6(e)(iii) of the By-Laws;
‘controlling,’ ‘controlled by’ and ‘under common
control with’) means the possession, direct or see also Sections 3.1(b)(i) and 3.1(b)(iii) of the By- Laws.
19 See proposed Section 3.6(e)(v)(F) of the By-
indirect, of the power to direct or cause the Laws, which constitute part of Nasdaq’s ‘‘advance
direction of the management and policies of a notice’’ provision under which a ‘‘Proposing Laws.
person, whether through the ownership of voting Person’’ may, among other things, nominate a 20 See proposed Section 3.6(e)(v)(G) of the By-
securities, by contract, or otherwise.’’ 17 CFR person for election to the Board. Laws.
240.12b–2. 13 See proposed Section 3.6(e)(iv) of the By-Laws. 21 See proposed Section 3.6(e)(vi) of the By-Laws.
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![Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices 69107
take with respect to such defect, which • is or has been, within the past three Stockholder Nominees from the proxy
may include, with respect to a material (3) years, an officer or director of a statement.
defect, omitting the relevant competitor, as defined for purposes of
Proposed Section 3.6(i) of the By-Laws
Stockholder Nominee from its proxy Section 8 of the Clayton Antitrust Act of
materials. 1914; 33 Under proposed Section 3.6(i), the
• is a named subject of a pending Board or the chairman of the meeting of
Proposed Section 3.6(h) of the By-Laws criminal proceeding (excluding traffic stockholders shall declare a proxy
Proposed Section 3.6(h) provides that violations and other minor offenses) or access nomination invalid, and such
Nasdaq shall not be required to include has been convicted in such a criminal nomination shall be disregarded even if
a Stockholder Nominee in its proxy proceeding within the past ten (10) proxies in respect of such nomination
materials for any meeting of years; 34 have been received by the Company, if:
stockholders under certain • is subject to any order of the type
circumstances. In these situations, the specified in Rule 506(d) of Regulation D • The Stockholder Nominee(s) and/or
proxy access nomination shall be promulgated under the Securities Act of the applicable Eligible Stockholder have
disregarded and no vote on such 1933, as amended; 35 breached its or their obligations under
Stockholder Nominee will occur, even if • is subject to ‘‘statutory the proxy access provision of the By-
Nasdaq has received proxies in respect disqualification’’ under Section 3(a)(39) Laws, as determined by the Board or the
of the vote. These circumstances occur of the Act; 36 chairman of the meeting of
when the Stockholder Nominee: • has, or the applicable Eligible stockholders, in each case, in its or his
• Has been nominated by an Eligible Stockholder has, provided information sole discretion; or
Stockholder who has engaged in or is to Nasdaq in respect of the proxy access • the Eligible Stockholder (or a
currently engaged in, or has been or is nomination that was untrue in any qualified representative thereof) does
a participant in another person’s, material respect or omitted to state a not appear at the meeting of
‘‘solicitation’’ within the meaning of material fact necessary in order to make stockholders to present the proxy access
Rule 14a–1(l) under the Act in support the statements made, in light of the nomination.
of the election of any individual as a circumstances under which they were
made, not misleading, as determined by Nasdaq believes this provision
director at the annual meeting other protects the Company and its
than its Stockholder Nominee(s) or a the Board or any committee thereof, in
each case, in its sole discretion; 37 or stockholders by providing the Board or
nominee of the Board; 30 the chairman of the stockholder meeting
• is not independent under the listing • breaches or fails, or the applicable
Eligible Stockholder breaches or fails, to limited authority to disqualify a proxy
standards of The NASDAQ Stock access nominee when that nominee or
Market, any applicable rules of the SEC comply with its obligations pursuant to
the By-Laws, including, but not limited the sponsoring stockholder(s) have
and any publicly disclosed standards breached an obligation under the proxy
used by the Board in determining and to, the proxy access provisions and any
agreement, representation or access provision, including the
disclosing independence of Nasdaq’s obligation to appear at the stockholder
directors, in each case as determined by undertaking required by the proxy
access provisions.38 meeting to present the proxy access
the Board in its sole discretion; 31 nomination.
Nasdaq believes these provisions will
• would, if elected as a member of the
protect the Company and its Proposed Section 3.6(j) of the By-Laws
Board, cause Nasdaq to be in violation
stockholders by allowing it to exclude
of the By-Laws (including but not
certain categories of objectionable Proposed Section 3.6(j) states that the
limited to the compositional
requirements of the Board set forth in following Stockholder Nominees who
one, but no more than two, Issuer Directors. Finally, are included in the Company’s proxy
Section 4.3 of the By-Laws), its the Board shall include no more than one Staff
Amended and Restated Certificate of Director, unless the Board consists of ten or more
materials for a particular annual
Incorporation, the rules and listing directors, in which case, the Board shall include no meeting of stockholders will be
standards of The NASDAQ Stock more than two Staff Directors. Detailed definitions ineligible to be a Stockholder Nominee
of the terms ‘‘Non-Industry Director,’’ ‘‘Industry for the next two annual meetings:
Market, or any applicable state or Director,’’ ‘‘Public Director,’’ ‘‘Issuer Director’’ and
federal law, rule or regulation; 32 ‘‘Staff Director’’ are included in Article I of the By- • A Stockholder Nominee who
Laws. withdraws from or becomes ineligible or
33 See proposed Section 3.6(h)(iv) of the By-Laws;
30 See proposed Section 3.6(h)(i) of the By-Laws; unavailable for election at the annual
see also 17 CFR 240.14a–1(l), which defines the see also 15 U.S.C. 19(a)(1), which generally
provides that ‘‘[n]o person shall, at the same time, meeting; or
related terms ‘‘solicit’’ and ‘‘solicitation.’’
31 See proposed Section 3.6(h)(ii) of the By-Laws; serve as a director or officer in any two • a Stockholder Nominee who does
corporations’’ that are ‘‘competitors’’ such that ‘‘the
see also footnote 28, supra. The Commission notes
elimination of competition by agreement between
not receive at least 25% of the votes cast
that, while additional, more stringent independence in favor of such Stockholder Nominee’s
them would constitute a violation of any of the
standards may be adopted by the Board in the
future, as of the date of this Notice no such
antitrust laws.’’ election.
34 See proposed Section 3.6(h)(v) of the By-Laws.
standards have been adopted by the Board. The
35 See proposed Section 3.6(h)(vi) of the By-Laws;
This provision will save the Company
Commission further notes that, according to and its stockholders the time and
Nasdaq, should the Board decide to adopt see also 17 CFR 230.506(d), which generally
additional, more stringent standards than those disqualifies offerings involving certain felons and expense of analyzing and addressing
required under Nasdaq listing standards and any other bad actors from relying on the ‘‘safe harbor’’ subsequent proxy access nominations
requirements under Commission rules, all director in Rule 506 of Regulation D from registration under regarding individuals who were
asabaliauskas on DSK3SPTVN1PROD with NOTICES
nominees would be evaluated against these the Securities Act of 1933, as amended.
36 See proposed Section 3.6(h)(vii) of the By- included in the proxy materials for a
standards—not just those shareholder candidates
nominated under the provisions of proposed Laws; see also 15 U.S.C. 78c(a)(39), which particular annual meeting but ultimately
Section 3.6. disqualifies certain categories of individuals who did not stand for election or receive a
32 See proposed Section 3.6(h)(iii) of the By-Laws; generally have engaged in misconduct from substantial amount of votes. After the
see also Section 4.3 of the By-Laws, which provides membership or participation in, or association with
a member of, a self-regulatory organization.
next two annual meetings, these
that the number of Non-Industry Directors on the
Board must equal or exceed the number of Industry 37 See proposed Section 3.6(h)(viii) of the By- Stockholder Nominees would again be
Directors. In addition, the Board must include at Laws. eligible for nomination through the
least two Public Directors and may include at least 38 See proposed Section 3.6(h)(ix) of the By-Laws. proxy access provisions of the By-Laws.
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![Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices 69109
IV. Solicitation of Comments For the Commission, by the Division of 19(b)(2)(B) of the Act 7 to determine
Trading and Markets, pursuant to delegated whether to approve or disapprove the
Interested persons are invited to authority.43 proposed rule change, as modified by
submit written data, views and Robert W. Errett, Amendment No. 1.8 In the Order
arguments concerning the foregoing, Deputy Secretary. Instituting Proceedings, the Commission
including whether the proposed rule [FR Doc. 2016–24007 Filed 10–4–16; 8:45 am] solicited comments on specified matters
change is consistent with the Act. BILLING CODE 8011–01–P related to the proposal.9
Comments may be submitted by any of
the following methods: On June 24, 2016, the Exchange filed
SECURITIES AND EXCHANGE Amendment No. 2, which replaced the
Electronic Comments COMMISSION originally filed proposed rule change in
its entirety.10
• Use the Commission’s Internet [Release No. 34–78913; File No. SR–
comment form (http://www.sec.gov/ Nasdaq–2016–002] On July 21, 2016, the Commission
rules/sro.shtml); or designated a longer period for
Self-Regulatory Organizations; The Commission action on the proposed rule
• Send an email to rule-comments@ NASDAQ Stock Market LLC; Notice of change.11 On August 30, 2016, the
sec.gov. Please include File Number SR– Filing of Amendment No. 3, and Order Exchange filed Amendment No. 3,
ISE–2016–22 on the subject line. Granting Accelerated Approval of which replaced the originally filed
Paper Comments Proposed Rule Change, as Modified by proposed rule change (as previously
Amendment No. 3, to List and Trade modified by Amendments No. 1 and No.
• Send paper comments in triplicate Shares of the First Trust Municipal 2) in its entirety.12
to Secretary, Securities and Exchange High Income ETF of First Trust
Exchange-Traded Fund III The Commission has not received any
Commission, 100 F Street NE.,
comments on the proposed rule change.
Washington, DC 20549–1090. September 23, 2016. The Commission is publishing this
All submissions should refer to File I. Introduction notice to solicit comments on
Number SR–ISE–2016–22. This file Amendment No. 3 from interested
number should be included on the On January 6, 2016, The NASDAQ persons, and is approving the proposed
subject line if email is used. To help the Stock Market LLC (‘‘Nasdaq’’ or the rule change, as modified by Amendment
Commission process and review your ‘‘Exchange’’) filed with the Securities No. 3, on an accelerated basis.
comments more efficiently, please use and Exchange Commission
(‘‘Commission’’), pursuant to Section II. The Exchange’s Description of the
only one method. The Commission will
19(b)(1) of the Securities Exchange Act Proposed Rule Change
post all comments on the Commission’s
of 1934 (‘‘Act’’ or ‘‘Exchange Act’’) 1 and
Internet Web site (http://www.sec.gov/ In its filing with the Commission,
Rule 19b–4 thereunder,2 a proposed rule
rules/sro.shtml). Copies of the change to list and trade shares Nasdaq included statements concerning
submission, all subsequent (‘‘Shares’’) of the First Trust Municipal the purpose of, and basis for, the
amendments, all written statements High Income ETF (‘‘Fund’’) under proposed rule change and discussed any
with respect to the proposed rule Nasdaq Rule 5735. The proposed rule comments it received on the proposed
change that are filed with the change was published for comment in rule change. Nasdaq has prepared
Commission, and all written the Federal Register on January 27, summaries, set forth in Sections A, B,
communications relating to the 2016.3 On February 16, 2016, the and C below, of the most significant
proposed rule change between the Exchange filed Amendment No. 1.4 On aspects of such statements.
Commission and any person, other than March 8, 2016, pursuant to Section
those that may be withheld from the 19(b)(2) of the Act,5 the Commission
public in accordance with the designated a longer period within which 7 15 U.S.C. 78s(b)(2)(B).
8 See Securities Exchange Act Release No. 77871,
provisions of 5 U.S.C. 552, will be to approve the proposed rule change,
81 FR 26265 (May 2, 2016) (‘‘Order Instituting
available for Web site viewing and disapprove the proposed rule change, or Proceedings’’).
printing in the Commission’s Public institute proceedings to determine 9 Specifically, the Commission instituted
Reference Room, 100 F Street NE., whether to disapprove the proposed proceedings to allow for additional analysis of the
Washington, DC 20549, on official rule change.6 proposed rule change’s consistency with Section
On April 26, 2016, the Commission 6(b)(5) of the Act, which requires, among other
business days between the hours of things, that the rules of a national securities
10:00 a.m. and 3:00 p.m. Copies of the instituted proceedings under Section exchange be ‘‘designed to prevent fraudulent and
filing also will be available for manipulative acts and practices, to promote just
43 17 CFR 200.30–3(a)(12).
inspection and copying at the principal and equitable principles of trade,’’ and ‘‘to protect
1 15 U.S.C. 78s(b)(1). investors and the public interest.’’ See id., 81 FR at
office of the Exchange. All comments 2 17 CFR 240.19b–4. 26268.
received will be posted without change; 3 See Securities Exchange Act Release No. 76944 10 Amendment No. 2 is available on the
the Commission does not edit personal (Jan. 21, 2016), 81 FR 4712. Commission’s Web site at: https://www.sec.gov/
identifying information from 4 Amendment No. 1 is available on the comments/sr-nasdaq-2016-002/nasdaq2016002-
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Commission’s Web site at: http://www.sec.gov/ 2.pdf.
submissions. You should submit only
comments/sr-bats-2015-100/bats2015100.shtml. 11 See Securities Exchange Act Release No. 78384,
information that you wish to make 5 15 U.S.C. 78s(b)(2). 81 FR 49286 (July 27, 2016) (designating September
available publicly. All submissions 6 See Securities Exchange Act Release No. 34– 23, 2016, as the date by which the Commission
should refer to File Number SR–ISE– 77320, 81 FR 13429 (Mar. 14, 2016). The must either approve or disapprove the proposed
2016–22 and should be submitted on or Commission designated April 26, 2016, as the date rule change).
by which the Commission would either approve or 12 Amendment No. 3 is available on the
before October 26, 2016. disapprove, or institute proceedings to determine Commission’s Web site at: https://www.sec.gov/
whether to approve or disapprove, the proposed comments/sr-nasdaq-2016-002/nasdaq2016002-
rule change. 3.pdf.
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Document Created: 2016-10-05 03:29:04
Document Modified: 2016-10-05 03:29:04
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 81 FR 69102 |
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