Federal Register / Vol. 89, No. 229 / Wednesday, November 27, 2024 / Notices 93691 

20 15 U.S.C. 78q–1(b)(3)(F). 

21 17 CFR 240.17ad–22(e)(18)(iv)(C). 

22Letter from Jiri Krol, Deputy CEO, Global Head 

of Government Affairs, Alternative Investment 

Management Association, at 8 (Apr. 23, 2024), 

available at https://www.sec.gov/comments/sr-ficc2024-006/srficc2024006.htm (‘‘AIMA Letter’’). 

23 17 CFR 240.17ad–25(j). 

24Clearing Agency Governance and Conflicts of 

Interest, Securities Exchange Act Release No. 98959 

(Nov. 16, 2023), 88 FR 84454, 84483 (Dec. 5, 2023). 

25See id. 

26AIMA Letter, supra note 22, at 8. 

27 17 CFR 240.17ad–22(e)(18)(iv)(C). 

28 15 U.S.C. 78q–1. 

29 15 U.S.C. 78s(b)(2). 

30 In approving the Proposed Rule Changes, the 

Commission considered their impact on efficiency, 

competition, and capital formation. 15 U.S.C. 78c(f). 

31 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

consistent with Section 17A(b)(3)(F) of 

the Act.20

Accordingly, and for the reasons 

stated above, the Commission finds that 

the Proposed Rule Changes are 

consistent with Section 17A(b)(3)(F) of 

the Act. 

B. Section 17Ad–22(e)(18)(iv)(C) of the 

Act 

Section 17Ad–22(e)(18)(iv)(C) under 

the Act requires, among other things, 

that a covered clearing agency serving 

the U.S. Treasury market, like FICC, 

establish, implement, maintain, and 

enforce written policies and procedures 

reasonably designed to ensure that the 

covered clearing agency has appropriate 

means to facilitate access to clearance 

and settlement services of all eligible 

secondary market transactions in U.S. 

Treasury securities, including those of 

indirect participants, and that the board 

of directors for the covered clearing 

agency, like FICC, annually review such 

policies and procedures.21 The 

Proposed Rule Changes, as described in 

Section III.B above, would establish an 

advisory council and framework for that 

council’s work and would provide for 

annual review by the FICC Board of 

Directors as to FICC’s policies and 

procedures regarding access to its 

clearance and settlement services. 

One commenter addressed certain 

aspects of this proposal. Specifically, 

the commenter states that FICC’s rules 

‘‘should provide that indirect 

participants will be allotted at least 50% 

of the representation on the council.’’ 22

The Commission agrees that indirect 

participant representation on the 

proposed council is important. Under 

the Proposed Rule Changes, the 

advisory council would include 

representatives not only from FICC 

participants, but also their customers, 

that is, indirect participants who rely on 

FICC’s services to access FICC’s 

clearance and settlement services. 

Though not required, the use of an 

advisory council is consistent with Rule 

17ad–22(e)(18)(iv)(C), and that rule does 

not mandate the particular composition 

of the advisory council that FICC has 

chosen to establish. 

The Commission recently adopted 

Rule 17ad–25(j) 23 which requires each 

registered clearing agency to establish, 

implement, maintain, and enforce 

written policies and procedures 

reasonably designed to solicit, consider, 

and document its consideration of the 

views of participants and other relevant 

stakeholders. The Commission therefore 

has given clearing agencies discretion in 

the design and structure of stakeholder 

outreach.24 The Commission also stated 

in the Rule 17ad–25(j) final rule release 

that such ‘‘other relevant stakeholders’’ 

generally would include investors, 

customers of clearing agency 

participants, and securities issuers.25

Pursuant to the Proposed Rule 

Changes, FICC would include indirect 

participants on its advisory council. The 

Commission supports the inclusion of 

indirect participants and encourages 

FICC to solicit views from a variety of 

indirect participants who may have 

differing needs. 

The commenter further stated that 

FICC should, ‘‘explicitly describe how 

and to what extent the feedback and 

recommendations made by the indirect 

participant members on the council (or 

indirect participants at large) will be 

considered and/or incorporated into the 

review process and potential changes to 

the access models.’’ 26 Within the 

Proposed Rule Changes, FICC has 

outlined specific points of 

consideration, and specific data to 

document and analyze in furtherance of 

the annual review by the Board of 

Directors, or a committee thereof, of 

GSD access models as noted in Section 

III.B above. In addition, pursuant to the 

Proposed Rule Changes, the advisory 

council’s review would be escalated to 

the FICC Board of Directors, or a 

committee thereof, to assist in their 

annual review. Rule 17ad– 

22(e)(18)(iv)(C) does not require the use 

of an advisory council. 

Accordingly, the Commission finds 

that the Proposed Rule Changes are 

consistent with the requirements of Rule 

17ad–22(e)(18)(iv)(C).27

V. Conclusion 

On the basis of the foregoing, the 

Commission finds that the Proposed 

Rule Change is consistent with the 

requirements of the Act and in 

particular with the requirements of 

Section 17A of the Act 28 and the rules 

and regulations promulgated 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act 29 that 

proposed rule changes SR–DTC–2024– 

003, SR–FICC–2024–006, and SR– 

NSCC–2024–003 be, and hereby are, 

approved.30

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–27754 Filed 11–26–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101693; File No. SR– 

NASDAQ–2024–068] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Deadline for a Listed Company To 

Notify Nasdaq of a Reverse Stock Split 

November 21, 2024. 

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 November 

8, 2024, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II, 

and III, below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to modify its 

listing standards related to notification 

and disclosure of reverse stock splits to 

the Exchange. The proposed rule change 

will become operative on January 30, 

2025. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules, 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 


ddrumheller on DSK120RN23PROD with NOTICES1
93692 Federal Register / Vol. 89, No. 229 / Wednesday, November 27, 2024 / Notices 

3See Securities Exchange Act Release No. 98014 

(July 28, 2023), 88 FR 51376 (August 3, 2023) 

(proposing SR–Nasdaq–2023–025). 

4See Securities Exchange Act Release No. 98843 

(November 1, 2023), 88 FR 76867 (November 7, 

2023) (approving SR–Nasdaq–2023–025). 

5See Securities Exchange Act Release No. 99734 

(March 14, 2024), 89 FR 19905 (March 20, 2024). 

6 17 CFR 240.10b–17. 

7 17 CFR 240.10b–17(a)(2), (b)(1) and (b)(3). 

8For example, if a company desires to effect a 

reverse stock split with a market effective date of 

Monday, September 23, the company would have 

to provide Nasdaq with a draft of the disclosure 

required by proposed Rule 5250(b)(4) and a 

complete Company Event Notification Form by 

12:00 p.m. ET on Friday, September 13, and 

provide the public disclosure by 12:00 p.m. ET by 

Thursday, September 19. Note that this example 

presumes that there are no holidays during these 

dates. If a company withdraws and re-submits a 

Company Event Notification Form, the 10 calendar 

day period would be measured from the date the 

company re-submitted the form (rather than the 

date of the first submission). 

9See supra note 3. 

10For example, a company may have already 

scheduled a shareholder meeting or submitted a 

preliminary or final proxy statement to the 

Commission with a view towards effecting a reverse 

stock split during a compliance period under the 

Nasdaq Listing Rules. The additional time to 

provide 10 calendar days advance notice of the 

reverse stock split, instead of the currently required 

five business-day notice period, could prevent the 

company from regaining compliance during the 

compliance period. 

11 15 U.S.C. 78f(b). 

12 15 U.S.C. 78f(b)(5). 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. 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 

On June 21, 2023, Nasdaq filed with 

the Commission a proposed rule change 

related to notification and disclosure of 

reverse stock splits.3 On November 1, 

2023, the Commission approved the 

proposed rule changes.4 On March 1, 

2024, Nasdaq adopted an additional 

change to the rule and Company Event 

Notification Form to further clarify the 

requirements.5 Nasdaq is now proposing 

to amend the deadline for a company to 

notify Nasdaq of a reverse stock split 

from 5 business days to 10 calendar 

days in order to conform to the 

requirements of SEC Rule 10b–17 of the 

Act.6

Specifically, Rule 10b–17(a)(2) and (b) 

of the Act, require issuers to provide 

notice to FINRA (formerly the National 

Association of Securities Dealers, Inc.) 

no later than 10 calendar days prior to 

the date of record to participate in a 

stock split or reverse stock split, unless 

the impacted security is traded on a 

national securities exchange with a 

substantially comparable requirement to 

those set forth in Rule 10b–17(b)(1).7

Currently, Rule 5250(e)(7) and IM– 

5250–3 require a company conducting a 

reverse stock split to notify Nasdaq 

about certain details of the reverse stock 

split by submitting a complete Company 

Event Notification Form and a draft of 

the disclosure required by Rule 

5250(b)(4) at least 5 business days (no 

later than 12:00 p.m. ET) prior to the 

anticipated market effective date, which 

includes all the information required by 

Rule 10b–17 applicable to reverse stock 

splits. 

It has come to Nasdaq’s attention that 

Nasdaq’s current rule may not be 

considered substantially comparable to 

the 10 calendar-day prior notice 

required in Rule 10b–17 of the Act. 

Accordingly, Nasdaq is proposing to 

amend the deadline for a company to 

notify Nasdaq of a reverse stock split 

from no later than 12:00 p.m. ET 5 

business days to 10 calendar days prior 

to the anticipated market effective date 

of the reverse stock split to ensure that 

Rule 5250(e)(7) and IM–5250–3 are 

substantially comparable to Rule 10b–17 

and, therefore, that companies are 

compliant with Rule 10b–17 when they 

give notice under those rules.8 Nasdaq 

is not amending the requirement to 

provide public disclosure under Rule 

5250(b)(4) at least 2 business days (no 

later than 12:00 p.m. ET) prior to the 

anticipated market effective date. 

Nasdaq still believes that this timeframe 

provides sufficient notice to the public 

about reverse stock splits.9

Nasdaq is also submitting an updated 

Company Event Notification Form as 

Exhibit 3 to the rule filing. Nasdaq is 

making conforming changes to the Form 

to reflect that the deadline for 

submission is 10 calendar days, rather 

than 5 business days. 

In order to provide companies that 

have already planned action for a 

reverse stock split under the current 

rule’s timeframe with the ability to 

effect their reverse stock split under that 

schedule, the proposed rule change will 

become operative on January 30, 2025.10

Nasdaq believes that this delayed 

operative date will allow sufficient time 

for market participants to adjust to the 

new time frame. For example, a 

company may have already scheduled a 

shareholder meeting or submitted a 

preliminary or final proxy statement to 

the Commission with a view towards 

effecting a reverse stock split based on 

the currently required five-day notice 

period. Nasdaq believes this delayed 

operative date will reduce potential 

confusion for companies and investors 

about the transition and allow 

companies to appropriately plan for the 

change. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,11 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,12

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, by 

aligning its rules related to notification 

of reverse stock splits with the 

notification requirements of Rule 10b– 

17 of the Act. 

The proposal amends Rule 5250(e)(7) 

and IM–5250–3 to require a company to 

submit a complete Company Event 

Notification Form and a draft of the 

disclosure required by Rule 5250(b)(4) 

at least 10 calendar days (no later than 

12:00 p.m. ET) prior to the anticipated 

market effective date, rather than 5 

business days, and provides conforming 

updates to the Company Event 

Notification Form. Nasdaq believes that 

this will align Nasdaq’s rules with the 

requirements of Rule 10b–17 under the 

Act, and will thereby help promote 

clarity, transparency and consistency for 

market participants and companies. 

Nasdaq also believes that the delayed 

operative date of the proposed rule 

change is consistent with Section 6(b)(5) 

of the Act in that it will allow sufficient 

time for market participants to adjust to 

the new time frame and will thereby 

help to reduce potential confusion for 

companies and investors. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

proposed change is designed to align an 

existing rule and related Company 

Event Notification Form with the 

requirements of Rule 10b–17 of the Act 

and, therefore, Nasdaq believes that the 

proposed change will not impose a 

burden on competition. 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 89, No. 229 / Wednesday, November 27, 2024 / Notices 93693 

13 15 U.S.C. 78s(b)(3)(A)(iii). 

14 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 15 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Notice of Filing infra note 4, at 89 FR 81958. 

4Securities Exchange Act Release No. 101246 

(Oct. 3, 2024), 89 FR 81958 (Oct. 9, 2024) (File No. 

SR–OCC–2024–014) (‘‘Notice of Filing’’). 

5 15 U.S.C. 78s(b)(2)(i). 

6 15 U.S.C. 78 s(b)(2)(ii). 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 13 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.14

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

NASDAQ–2024–068 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–NASDAQ–2024–068. 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 website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website 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 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–NASDAQ–2024–068 and should be 

submitted on or before December 18, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–27761 Filed 11–26–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101684; File No. SR–OCC– 

2024–014] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Designation of Longer Period for 

Commission Action on Proposed Rule 

Change, as Modified by Partial 

Amendment No. 1, by the Options 

Clearing Corporation Concerning Its 

Process for Adjusting Certain 

Parameters in Its Proprietary System 

for Calculating Margin Requirements 

During Periods When the Products It 

Clears and the Markets It Serves 

Experience High Volatility 

November 21, 2024. 

On October 1, 2024, the Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change SR–OCC–2024– 

014, pursuant to Section 19(b) of the 

Securities Exchange Act of 1934 

(‘‘Exchange Act’’) 1 and Rule 19b–4 2

thereunder, to codify OCC’s process for 

adjusting certain parameters in its 

proprietary system for calculating 

margin requirements during periods 

when the products OCC clears and the 

markets it serves experience high 

volatility.3 The proposed rule change, as 

modified by Partial Amendment no. 1 

(hereinafter, the ‘‘Proposed Rule 

Change’’), was published for public 

comment in the Federal Register on 

October 9, 2024.4 The Commission has 

received no comments regarding the 

Proposed Rule Change. 

Section 19(b)(2)(i) of the Exchange 

Act 5 provides that, within 45 days of 

the publication of notice of the filing of 

a proposed rule change, the Commission 

shall either approve the proposed rule 

change, disapprove the proposed rule 

change, or institute proceedings to 

determine whether the proposed rule 

change should be disapproved unless 

the Commission extends the period 

within which it must act as provided in 

Section 19(b)(2)(ii) of the Exchange 

Act.6 Section 19(b)(2)(ii) of the 

Exchange Act allows the Commission to 

designate a longer period for review (up 

to 90 days from the publication of notice 

of the filing of a proposed rule change) 

if the Commission finds such longer 

period to be appropriate and publishes 


ddrumheller on DSK120RN23PROD with NOTICES1