Federal Register / Vol. 89, No. 249 / Monday, December 30, 2024 / Notices 106717 

10See Securities Exchange Act Release No. 97403 

(April 28, 2023), 88 FR 28645 (May 4, 2023) (SR– 

FINRA–2023–008). 11 15 U.S.C. 78s(b)(3)(A)(iii). 12 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. 13 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

and distributional and competitive 

effects.10

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 11 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.12

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–2024–085 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–2024–085. 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–2024–085 and should be 

submitted on or before January 21, 2025. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–30917 Filed 12–27–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101978; File No. SR– 

NASDAQ–2024–084] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing of Proposed Rule Change To 

Modify Certain Initial Listing Liquidity 

Requirements 

December 19, 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 December 

12, 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 

certain initial listing liquidity 

requirements. 

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 

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 

Nasdaq is proposing to modify Listing 

Rules 5405 and 5505 to require that a 

company listing on the Nasdaq Global 

Market or Nasdaq Capital Market in 

connection with an initial public 

offering (‘‘IPO’’) satisfy the applicable 

minimum Market Value of Unrestricted 

Publicly Held Shares (‘‘MVUPHS’’) 

requirement solely from the proceeds of 

the offering. Nasdaq is also proposing to 

make similar changes affecting 

companies that uplist to Nasdaq from 

the U.S. over-the-counter market (‘‘OTC 

market’’) in conjunction with a public 

offering. 

Nasdaq Listing Rules require a 

company to have a minimum Market 

Value of Unrestricted Publicly Held 


ddrumheller on DSK120RN23PROD with NOTICES1
106718 Federal Register / Vol. 89, No. 249 / Monday, December 30, 2024 / Notices 

3See Listing Rules 5405(b)(1)(C), 5405(b)(2)(C), 

5405(b)(3)(B), and 5405(b)(4)(B). 

4See Listing Rules 5505(b)(1)(B), 5505(b)(2)(C), 

and 5505(b)(3)(C). 

5See Listing Rule 5005(a)(46). 

6See footnotes 3 and 4, above. 

7See Listing Rules 5405(a) and 5505(a). This 

requirement is the same under the listing rules of 

both the Nasdaq Global Market and Nasdaq Capital 

Market. 

8See footnotes 3 and 4, above. 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(5). 

11See text accompanying footnotes 3 and 4, 

above. 

Shares. For initial listing on the Nasdaq 

Global Market, a company must have a 

minimum MVUPHS of $8 million under 

the Income Standard, $18 million under 

the Equity Standard, and $20 million 

under either the Market Value or Total 

Assets/Total Revenue Standards.3 For 

initial listing on the Nasdaq Capital 

Market, a company must have a 

minimum MVUPHS of $5 million under 

the Net Income Standard, and $15 

million under either the Equity or 

Market Value of Listed Securities 

Standards.4

Unrestricted Publicly Held Shares are 

shares that are not held by an officer, 

director or 10% shareholder of the 

company and which are not subject to 

resale restrictions of any kind.5 In the 

case of a company listing in conjunction 

with a public offering, previously issued 

shares registered for resale (‘‘Resale 

Shares’’), and not held by an officer, 

director or 10% shareholder of the 

company, are counted as Unrestricted 

Publicly Held Shares in addition to the 

shares being sold in the offering. 

The MVUHPS standard is one of the 

core liquidity requirements within the 

Nasdaq listing rules. Like the other 

liquidity requirements, it is meant to 

ensure that there is sufficient liquidity 

to provide price discovery and support 

an efficient and orderly market for the 

company’s securities. Nonetheless, 

Nasdaq has observed that the securities 

companies that meet the applicable 

MVUPHS requirement by including 

Resale Shares have experienced higher 

volatility on the date of listing than 

those of similarly situated companies 

that meet the requirement with only the 

proceeds from the offering. Nasdaq 

believes that the Resale Shares may not 

contribute to liquidity to the same 

degree as the shares sold in the public 

offering. As such, Nasdaq believes it is 

appropriate to modify the rules to 

exclude the Resale Shares from the 

calculation of MVUPHS for initial 

listing of companies listing in 

conjunction with a public offering. 

Accordingly, Nasdaq proposes to 

modify Listing Rules 5405(b) and 

5505(b) to provide that a company 

listing in connection with an initial 

public offering, including through the 

issuance of American Depository 

Receipts, must satisfy the applicable 

MVUPHS requirement for each initial 

listing standard for primary equity 

securities 6 with the proceeds of that 

offering. 

Related to this change, Nasdaq 

believes it also is appropriate to apply 

a similar requirement to companies 

trading in the OTC market that qualify 

for listing based on an offering. 

Specifically, a company trading in the 

OTC market prior to listing must 

currently satisfy either a minimum daily 

trading volume on the OTC market of 

2,000 shares over the past 30 trading 

days with trading occurring in at least 

50% of those days (the ‘‘ADV 

Requirement’’) or, alternatively, list in 

connection with a firm commitment 

underwritten public offering of at least 

$4 million.7 This alternative recognizes 

that where a company is listing in 

connection with a significant firm 

commitment underwritten public 

offering the liquidity characteristics of 

the prior trading will change and reflect 

the offering, just like in an IPO, and 

shares in the offering will be the 

primary source of liquidity upon listing. 

Given Nasdaq’s observations about 

the liquidity characteristics of IPOs with 

Resale Shares, Nasdaq believes it is 

appropriate to treat OTC companies 

relying on an offering in a similar 

manner, given that the liquidity in such 

listings is also expected to be supported 

by the offering. Accordingly, Nasdaq 

proposes to modify the alternative to the 

ADV requirement in Listing Rules 

5405(a)(4) and 5505(a)(5). As revised, a 

company relying on the alternative will 

be required to satisfy the applicable 

MVUPHS requirements with only the 

proceeds from the offering. As a result, 

Nasdaq also proposes to modify Listing 

Rules 5405(a)(4) and 5505(a)(5) to 

increase the size of the required public 

offering for this alternative to the ADV 

Requirement from $4 million to $5 

million for Capital Market applicants 

and $8 million for Global Market 

applicants to align with the minimum 

MVUHPS requirement for each market.8

If the company qualifies under a 

different standard, instead of the income 

standard, the minimum raise instead 

would have to satisfy the MVUPHS 

requirement of the applicable standard. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,9 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,10

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. 

Specifically, Nasdaq believes that the 

proposal to modify Listing Rules 

5405(b) and 5505(b) to require that a 

company listing on the Nasdaq Global 

Market or Capital Market in connection 

with an IPO satisfy the applicable 

minimum MVUPHS requirement solely 

from the proceeds of the offering is 

designed to protect investors and the 

public interest and to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system because 

Nasdaq believes that the change will 

likely result in less volatile trading of 

affected companies upon listing. As 

described above, the MVUHPS standard 

is one of the core liquidity requirements 

within the Nasdaq listing rules designed 

to ensure that there is sufficient 

liquidity to provide price discovery and 

support an efficient and orderly market 

for the company’s securities. Based on 

Nasdaq’s experience, companies that 

meet the applicable MVUPHS 

requirement by including Resale Shares 

are more likely to be subject to volatile 

trading on the date of listing than 

similarly situated companies that meet 

the requirement with only the proceeds 

from the offering. Nasdaq believes that 

this proposed change will help ensure 

that the initial pool of liquidity 

available for trading meets or exceeds 

the minimum applicable MVUHPS 

requirement. 

Nasdaq also believes that the proposal 

to modify Listing Rules 5405(a)(4) and 

5505(a)(5) to require that a company 

that is trading on the OTC market at the 

time of its application and that is listing 

in conjunction with a firm commitment 

public offering in lieu of meeting the 

ADV Requirement must satisfy the 

applicable MVUPHS requirements with 

only the proceeds from the offering is 

designed to protect investors and the 

public interest and to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system because, 

Nasdaq believes it is appropriate to 

align the minimum offering size for this 

alternative to the ADV Requirement 

with the minimum MVUHPS 

requirement for each market 11 by 

modifying Listing Rules 5405(a)(4) and 

5505(a)(5) to set the minimum offering 

under this alternative to $5 million on 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 89, No. 249 / Monday, December 30, 2024 / Notices 106719 

12Securities Exchange Act Release No. 86314 

(July 5, 2019), 84 FR 33102 (July 11, 2019) 

(approving SR–NASDAQ–2019–009). 13 17 CFR 200.30–3(a)(12). 

the Capital Market and to $8 million on 

the Global Market because, in the case 

where a company does not meet the 

ADV Requirement, the offering serves as 

the primary source of price discovery in 

the same way the offering does in an 

IPO, as described above. Moreover, 

failure to align these requirements could 

allow a company to begin trading on the 

OTC market and then uplist to Nasdaq 

a short time later with an offering that 

does not satisfy the proposed new 

requirements for companies listed in 

connection with an IPO, as described 

above. 

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. While 

Nasdaq does not believe there will be 

any impact on inter-market competition 

from the proposed change, any impact 

on competition that does arise will be 

necessary to better protect investors, in 

furtherance of a central purpose of the 

Act. Moreover, each national securities 

exchange can elect how to structure its 

listing requirements and respond in a 

competitive manner. In that regard, 

Nasdaq notes, for example, that in 2019 

Nasdaq first enhanced its initial listing 

requirements to exclude holders of 

restricted stock from the calculation of 

the market value of publicly held shares 

and to impose a requirement that a 

minimum number of shareholders hold 

at least $2,500 worth of unrestricted 

stock, however New York Stock 

Exchange and NYSE American have not 

adopted comparable requirements and 

compete for listings on such basis.12

Nasdaq also believes that any impact 

on intra-market competition from the 

proposed change affecting companies 

listing on the Nasdaq Global and Capital 

Markets in connection with an IPO or 

uplisting form the OTC market, as 

described above, will be necessary to 

better protect investors, in furtherance 

of a central purpose of the Act. In that 

regard, companies listing on Nasdaq 

through other means, such as those 

listing on the Nasdaq Global Select 

Market or listing through a Direct 

Listing, are already subject to higher 

initial listing standards than companies 

impacted by this proposed change and 

Nasdaq has not observed similar 

concerns with the trading of these 

companies’ securities. 

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. 

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–2024–084 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–2024–084. 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–2024–084 and should be 

submitted on or before January 21, 2025. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–30898 Filed 12–27–24; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

Interest Rates 

The Small Business Administration 

publishes an interest rate called the 

Optional Peg Rate (13 CFR 120.214) on 

a quarterly basis. This rate is a weighted 

average cost of money to the 

government for maturities similar to the 

average SBA direct loan. This rate may 

be used as a base rate for guaranteed 

fluctuating interest rate SBA loans. This 

rate will be 4.38 percent for the 

January–March quarter of FY 2025. 

Pursuant to 13 CFR 120.921(b), the 

maximum legal interest rate for any 

Third Party Lender’s commercial loan 

which funds any portion of the cost of 

a 504 project (see 13 CFR 120.801) shall 

be 6% over the New York Prime rate or, 

if that exceeds the maximum interest 

rate permitted by the constitution or 

laws of a given State, the maximum 

interest rate will be the rate permitted 

by the constitution or laws of the given 

State. 

David Parrish, 

Chief, Secondary Market Division. 

[FR Doc. 2024–31199 Filed 12–27–24; 8:45 am] 

BILLING CODE 8026–09–P 


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