31290 Federal Register / Vol. 87, No. 99 / Monday, May 23, 2022 / Notices 

48 15 U.S.C. 78f. 

49 15 U.S.C. 78f(b)(5). 

50See e.g., Securities Exchange Act Release No. 

59055 (Dec. 4, 2008), 73 FR 75148 (Dec. 10, 2008) 

(approving proposals to list and trade options on 

IAU and the iShares Silver Trust); Securities 

Exchange Act Release No. 57894 (May 30, 2008), 73 

FR 32061 (Jun. 5, 2008) (approving proposals to list 

and trade options on GLD); and Securities Exchange 

Act Release No. 61483 (Feb. 3, 2010), 75 FR 6753 

(Feb. 10, 2010) (approving proposals to list and 

trade options on the ETFS Gold Trust and ETFS 

Silver Trust). 

51See Notice, supra note 3, at 20904. 

52 15 U.S.C. 78f(b)(1). 

53See FINRA Rule 5310. 

54See Cboe Rule 9.9 and Rule 9.15. 

55See Cboe Rule 9.3. 

56See Chapter 5 of Cboe’s Rules. 

57 17 CFR 242.600. 

58See Cboe Rule 4.3(a); see also supra note 19. 

59See Cboe Rule 4.3.06(b)(1). See also Cboe Rule 

4.3.01 (providing guidelines established by the 

Board of Directors to be considered by the Exchange 

in evaluating potential underlying securities for 

Exchange option transactions). 

60See Cboe Rule 4.3.06(b)(2). The Exchange 

represents that, at minimum, the AAAU satisfies 

this initial listing criteria. See Notice, supra note 3, 

87 FR at 20903. 

61See Cboe Rule 4.4.06. 

62See Notice, supra note 3, 87 FR at 20903. 

63See id. 

64 15 U.S.C. 78s(b)(2). 

65 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

of the Act.48 Specifically, the 

Commission finds that the proposed 

rule change is consistent with Section 

6(b)(5) of the Act,49 which requires, 

among other things, that the rules of a 

national securities exchange be 

designed to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities, 

to remove impediments to and perfect 

the mechanism of a free and open 

market and a national market system, 

and, in general, to protect investors and 

the public interest. 

The Commission believes that the 

proposal to list and trade options on 

AAAU on the Exchange will provide 

investors with the ability to transact in 

AAAU options in a listed market 

environment, which could provide 

investors with heightened contra-party 

creditworthiness due to the role of OCC 

as issuer and guarantor of all listed 

options, as well as increased 

transparency and enhanced price 

discovery. Moreover, the Exchange 

already lists options on other gold-based 

ETFs, which, as described above, are 

trusts structured in substantially the 

same manner as AAAU,50 and the 

Exchange represents that it has not 

identified any issues with the continued 

listing and trading of the gold-backed 

ETF options that it currently lists for 

trading.51

As a national securities exchange, 

Cboe is required under Section 6(b)(1) of 

the Act 52 to enforce compliance by its 

members, and persons associated with 

its members, with the provisions of the 

Act, Commission rules and regulations 

thereunder, and its own rules. In 

addition, brokers that trade AAAU 

options also will be subject to best 

execution obligations and FINRA 

rules.53 Applicable exchange rules also 

require that customers receive 

appropriate disclosure before trading 

AAAU Options.54 Further, brokers 

opening accounts and recommending 

options transactions must comply with 

relevant customer suitability 

standards.55

Options on AAAU will trade as 

options under the trading rules of the 

Exchange.56 AAAU options must also 

satisfy Exchange initial listing and 

continued listing standards applicable 

to options on all Units, including the 

gold-backed commodity ETFs already 

approved for options trading on the 

Exchange. A security on which options 

may be listed and traded on the 

Exchange must be duly registered and 

be an ‘‘NMS stock’’ as defined under 

Rule 600 of Regulation NMS 57 and be 

characterized by a substantial number of 

outstanding shares which are widely 

held and actively traded.58

Additionally, Units must meet either (1) 

the criteria and guidelines under Cboe 

Rule 4.3.01,59 or (2) they must be 

available for creation or redemption 

each business day from or through the 

issuer in cash or in kind at a price 

related to net asset value, and the issuer 

must be obligated to issue Units in a 

specified aggregate number even if some 

or all of the investment assets required 

to be deposited have not been received 

by the issuer, subject to the condition 

that the person obligated to deposit the 

investments has undertaken to deliver 

the investment assets as soon as 

possible and such undertaking is 

secured by the delivery and 

maintenance of collateral consisting of 

cash or cash equivalents satisfactory to 

the issuer, as provided in the respective 

prospectus.60

Series of AAAU options also will be 

subject to the Exchange’s continued 

listing requirements, including 

standards applicable to the underlying 

Trust. If the Units cease to be an NMS 

stock or the Units are halted from 

trading in their primary market, the 

Exchange will deem Units that were 

initially approved for options trading 

pursuant to Cboe Rule 4.3.06 not to 

meet the requirements for continued 

approval, and the Exchange shall not 

open for trading any additional series of 

option contracts of the class covering 

such Units.61

The Exchange represents that its 

existing surveillance and reporting 

safeguards are designed to deter and 

detect possible manipulative behavior 

which might arise from listing and 

trading ETF options, including AAAU 

options.62 The Exchange also represents 

that it has the necessary systems 

capacity to support the new ETF option 

series.63 Additionally, the Commission 

notes that AAAU options will trade in 

the same manner as any other options 

on ETFs, and the same Exchange rules 

that currently govern the listing and 

trading of ETF options, including 

permissible expirations, strike prices 

and minimum increments, and 

applicable position and exercise limits 

and margin requirements, will govern 

the listing and trading of options on 

AAAU. 

Finally, the Commission believes that 

the Exchange’s proposals to make 

grammatical edits to the rule text and 

update the names of certain ETFs in 

Cboe Rule 4.3.06(a)(4) are helpful 

technical changes that add clarity and 

accuracy to the rule text. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,64 that the 

proposed rule change (SR–CBOE–2022– 

009) be, and hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.65

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–10967 Filed 5–20–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94935; File No. SR–GEMX– 

2022–07] 

Self-Regulatory Organizations; Nasdaq 

GEMX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend the Nasdaq 

Amended and Restated Certificate of 

Incorporation 

May 17, 2022. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’),1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on May 6, 2022, Nasdaq GEMX, LLC 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 


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Federal Register / Vol. 87, No. 99 / Monday, May 23, 2022 / Notices 31291 

3Nasdaq owns 100% of the equity interest in U.S. 

Exchange Holdings, Inc., which in turn owns 100% 

of the equity interest in International Securities 

Exchange Holdings, Inc., which in turn owns 100% 

of the equity interest in the Exchange. The 

Exchange’s affiliates, Boston Stock Exchange 

Clearing Corporation, Nasdaq BX, Inc., Nasdaq 

MRX, LLC, Nasdaq ISE, LLC, The Nasdaq Stock 

Market LLC, Nasdaq PHLX LLC, and Stock Clearing 

Corporation of Philadelphia will each concurrently 

submit substantially the same rule filings to 

propose the changes described herein. 

4Nasdaq currently has no Preferred Stock 

outstanding. 

5The price of one share of Common Stock on 

March 31, 2017 was $69.45 and the closing market 

price of one share of Common Stock on April 1, 

2022 was $181.92 as reported on the Nasdaq Stock 

Market. 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(1). 

change as described in Items I and II 

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 amend the 

Amended and Restated Certificate of 

Incorporation (‘‘Certificate’’) of its 

parent corporation, Nasdaq, Inc. 

(‘‘Nasdaq’’ or the ‘‘Company’’), to 

increase Nasdaq’s authorized share 

capital. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/gemx/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 

The purpose of the proposed rule 

change is to amend the Nasdaq 

Certificate 3 to increase the total number 

of authorized shares of Nasdaq common 

stock, par value $0.01 per share 

(‘‘Common Stock’’). Specifically, the 

Exchange proposes to amend Article 

Fourth, Section A such that the total 

number of shares of Stock (i.e., capital 

stock) that Nasdaq is authorized to issue 

would be increased from 330,000,000 to 

930,000,000 shares, and the portion of 

that total constituting Common Stock 

would be changed from 300,000,000 to 

900,000,000 shares. As amended, 

Article Fourth, Section A of the 

Certificate would provide: 

The total number of shares of Stock which 

Nasdaq shall have the authority to issue is 

Nine Hundred Thirty Million (930,000,000), 

consisting of Thirty Million (30,000,000) 

shares of Preferred Stock, par value $.01 per 

share (hereinafter referred to as ‘‘Preferred 

Stock’’), and Nine Hundred Million 

(900,000,000) shares of Common Stock, par 

value $.01 per share (hereinafter referred to 

as ‘‘Common Stock’’).4

As noted above, the proposed 

amendments to the Certificate were 

approved by the Nasdaq Board of 

Directors (‘‘Nasdaq Board’’) on March 

23, 2022. The proposed amendments to 

the Certificate would be effective when 

filed with the Secretary of State of 

Delaware, which would not occur until 

approval of the amendments by the 

stockholders of Nasdaq is obtained at 

the 2022 Annual Meeting of the 

Stockholders on June 22, 2022 and until 

this proposed rule change becomes 

effective and operative. 

The trading price of Nasdaq’s 

Common Stock has risen significantly 

over the past several years. Since 

Nasdaq first became a publicly traded 

company in 2002, the total number of 

authorized shares of Common Stock has 

remained constant at 300,000,000 

shares. However, over the last five years, 

the trading price of Nasdaq’s Common 

Stock has increased by approximately 

162%.5 As the trading price of Nasdaq’s 

Common Stock has risen, the Nasdaq 

Board has carefully evaluated the effect 

of the trading price of the Common 

Stock on the liquidity and marketability 

of the Common Stock. The Nasdaq 

Board believes that this price 

appreciation may be affecting the 

liquidity of the Common Stock, making 

it more difficult to efficiently trade and 

potentially less attractive to certain 

investors. Accordingly, the Nasdaq 

Board approved pursuing a 3-for-1 stock 

split by way of a stock dividend, 

pursuant to which the holders of record 

of shares of Common Stock would 

receive, by way of a dividend, two 

shares of Common Stock for each share 

of Common Stock held by such holder 

(the ‘‘Stock Dividend’’). The Nasdaq 

Board’s approval of the Stock Dividend 

was contingent upon this proposed rule 

change becoming effective and 

operative, and Nasdaq stockholder 

approval of the proposed amendments 

to the Certificate. 

The number of shares of Common 

Stock proposed to be issued in the Stock 

Dividend exceeds Nasdaq’s authorized 

but unissued shares of Common Stock. 

The proposed rule change would 

increase Nasdaq’s authorized shares of 

Common Stock and shares of capital 

stock sufficient to allow Nasdaq to 

effectuate the Stock Dividend. 

The proposed changes would not 

otherwise alter the Certificate, including 

the limitations on voting and ownership 

set forth in Article Fourth, Section C of 

the Certificate that generally provides 

no person who beneficially owns shares 

of common stock or preferred stock of 

Nasdaq in excess of 5% of the thenoutstanding securities generally entitled 

to vote may vote the shares in excess of 

5%. This limitation mitigates the 

potential for any Nasdaq shareholder to 

exercise undue control over the 

operations of Nasdaq’s self-regulatory 

subsidiaries, and facilitates the selfregulatory subsidiaries’ and the 

Commission’s ability to carry out their 

regulatory obligations under the Act. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,6 in general, and furthers the 

objectives of Section 6(b)(1) of the Act,7

in that it enables the Exchange to be so 

organized as to have the capacity to be 

able to carry out the purposes of the 

Exchange Act and to comply, and to 

enforce compliance by its members and 

persons associated with its members, 

with the provisions of the Exchange Act, 

the rules and regulations thereunder, 

and the rules of the Exchange. 

The proposal to increase Nasdaq’s 

authorized shares of Common Stock and 

shares of capital stock sufficient to 

allow Nasdaq to effectuate the Stock 

Dividend would not impact the 

Exchange’s ability to be so organized as 

to have the capacity to be able to carry 

out the purposes of the Exchange Act. 

In particular, the proposed changes 

would not alter the limitations on voting 

and ownership set forth in Article 

Fourth, Section C of the Certificate, and 

so the proposed changes would not 

enable a person to exercise undue 

control over the operations of Nasdaq’s 

self-regulatory subsidiaries or to restrict 

the ability of the Commission or the 

Exchange to effectively carry out their 

regulatory oversight responsibilities 

under the Act. 


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31292 Federal Register / Vol. 87, No. 99 / Monday, May 23, 2022 / Notices 

8 15 U.S.C. 78f(b)(5). 

9 In particular, the ICE proposal increased ICE’s 

total number of authorized shares of ICE common 

stock in order to effectuate a 5-for-1 stock split by 

way of a stock dividend. See Securities Exchange 

Act Release No. 78992 (September 29, 2016), 81 FR 

69092 (October 5, 2016) (SR–NYSE–2016–57, SR– 

NYSEArca–2016–119, and SR–NYSEMKT–2016– 

80) (hereinafter, ‘‘ICE Approval’’). 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

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

give the Commission written notice of its intent to 

file the proposed rule change, along with a brief 

description and text of 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. 12 17 CFR 200.30–3(a)(12). 

The Exchange also believes that the 

proposal is consistent with Section 

6(b)(5) of the Act 8 because it would not 

impact the Exchange’s governance or 

regulatory structure, which would 

continue to be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in regulating, clearing, settling, 

processing information with respect to, 

and facilitating transactions in 

securities, to remove impediments to 

and perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. 

The Exchange believes that the 

proposed rule change would 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, because by increasing 

Nasdaq’s authorized shares of Common 

Stock and shares of capital stock 

sufficient to allow Nasdaq to effectuate 

the Stock Dividend, the proposed rule 

change will facilitate broader ownership 

of Nasdaq. 

The Exchange also notes that the 

proposed rule change is substantially 

similar to a prior proposal by 

Intercontinental Exchange, Inc. (‘‘ICE’’), 

which is the holding company for three 

national securities exchanges, including 

the New York Stock Exchange. The ICE 

proposal amended ICE’s Certificate of 

Incorporation to effectuate a similar 

stock split as proposed by the Exchange 

herein.9 As such, the Exchange does not 

believe that its proposal raises any new 

or novel issues not already considered 

by the Commission. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

Because the proposed rule change 

relates solely to the number of 

authorized shares of Common Stock and 

shares of capital stock 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 

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) of the Act 10 and Rule 19b– 

4(f)(6) thereunder.11

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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

GEMX–2022–07 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–GEMX–2022–07. 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 (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 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 

10:00 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. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–GEMX–2022–07 and 

should be submitted on or before June 

13, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–10957 Filed 5–20–22; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Docket No. SBA–2022–001] 

Class Waiver of the Nonmanufacturer 

Rule 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notification of class waiver of 

the Nonmanufacturer Rule for dental 

equipment and supplies. 

SUMMARY: The U.S. Small Business 

Administration (SBA) is granting a 

request for a class waiver of the 

Nonmanufacturer Rule (NMR) for dental 

equipment and supplies. 


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