33566 Federal Register / Vol. 87, No. 106 / Thursday, June 2, 2022 / Notices 

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

2 17 CFR 240.19b–4. 

3Nasdaq owns 100% of the equity interest in 

Nasdaq BX, Inc., which in turn owns 100% of the 

equity interest in BSECC. BSECC’s affiliates, Nasdaq 

BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, 

Nasdaq MRX, 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. 78q–1(b)(3)(A). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94990; File No. SR– 

BSECC–2022–001] 

Self-Regulatory Organizations; Boston 

Stock Exchange Clearing Corporation; 

Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change To Amend the Nasdaq 

Amended and Restated Certificate of 

Incorporation 

May 26, 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 16, 2022, Boston Stock 

Exchange Clearing Corporation 

(‘‘BSECC’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

the proposed rule change as described 

in Items I and II below, which Items 

have been prepared by BSECC. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

BSECC is filing this proposed rule 

change 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 BSECC’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/bsecc/rules, at the principal 

office of BSECC, and at the 

Commission’s Public Reference Room. 

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, 

BSECC 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. BSECC has prepared 

summaries, set forth in Sections A, B, 

and C below, of the most significant 

aspects of such statements. 

A. Clearing Agency’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, BSECC 

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 

BSECC believes that its proposal is 

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

the Act,6 in that it enables BSECC to be 

so organized as to have the capacity to 

be able to facilitate the prompt and 

accurate clearance and settlement of 

securities transactions and derivative 

agreements, contracts, and transactions 

for which it is responsible, to safeguard 

securities and funds in its custody or 


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Federal Register / Vol. 87, No. 106 / Thursday, June 2, 2022 / Notices 33567 

7 15 U.S.C. 78q–1(b)(3)(F). 

8 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’’). 

9 15 U.S.C. 78s(b)(3)(A). 

10 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. BSECC has 

satisfied this requirement. 11 17 CFR 200.30–3(a)(12). 

control or for which it is responsible, to 

comply with the provisions of the 

Exchange Act and the rules and 

regulations thereunder, to enforce 

compliance by its participants with the 

rules of BSECC, and to carry out the 

purposes of the Exchange Act. 

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 BSECC’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 selfregulatory subsidiaries or to restrict the 

ability of the Commission or BSECC to 

effectively carry out their regulatory 

oversight responsibilities under the Act. 

BSECC also believes that the proposal 

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

of the Act 7 because it would not impact 

BSECC’s governance or regulatory 

structure, which would continue to be 

designed to foster cooperation and 

coordination with persons engaged in 

the clearance and settlement of 

securities transactions, remove 

impediments to and perfect the 

mechanism of a national system for the 

prompt and accurate clearance and 

settlement of securities transactions, 

and, in general, to protect investors and 

the public interest. 

BSECC believes that the proposed rule 

change would remove impediments to 

and perfect the mechanism of a national 

system for the prompt and accurate 

clearance and settlement of securities 

transactions, 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. 

BSECC 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 BSECC 

herein.8 As such, BSECC does not 

believe that its proposal raises any new 

or novel issues not already considered 

by the Commission. 

B. Clearing Agency’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 BSECC, 

BSECC 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. Clearing Agency’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 9 and Rule 19b– 

4(f)(6) thereunder.10

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– 

BSECC–2022–001 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–BSECC–2022–001. 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 BSECC. 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–BSECC– 

2022–001 and should be submitted on 

or before June 23, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–11786 Filed 6–1–22; 8:45 am] 

BILLING CODE 8011–01–P 


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