Federal Register / Vol. 73, No. 7 / Thursday, January 10, 2008 / Notices 1901 

8 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5On December 12, 2007, Nasdaq’s stockholders 

voted to approve a change in its name from The 

Nasdaq Stock Market, Inc. to The NASDAQ OMX 

Group, Inc. The change will become effective upon 

the closing of the Transactions (as defined below). 

6Copies of the Definitive Agreements and a 

description of their terms were filed by Nasdaq on 

Continued 

burden on competition that is 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 

The Exchange neither solicited nor 

received comments on the proposal. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 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 will: 

(A) By order approve 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–CBOE–2007–143 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–CBOE–2007–143. This file 

number should be included on the 

subject line if e-mail 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 inspection and copying 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 such filing also will be 

available for inspection and copying at 

the principal office of the CBOE. 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–CBOE–2007–143 and 

should be submitted on or before 

January 31, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E8–188 Filed 1–9–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–57099; File No. SR–

NASDAQ–2008–002] 

Self-Regulatory Organizations; the 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Nasdaq Stockholders’ Agreement 

Between the Nasdaq Stock Market, Inc. 

and Borse Dubai Limited 

January 4, 2008. 

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 January 2, 

2008, the NASDAQ Stock Market LLC 

(the ‘‘Nasdaq Exchange’’) 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 

substantially by the Nasdaq Exchange. 

The Nasdaq Exchange filed the 

proposed rule change pursuant to 

section 19(b)(3)(A) of the Act 3 and Rule 

19b–4(f)(6) thereunder,4 which renders 

it effective upon filing with the 

Commission. 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 Nasdaq Exchange’s parent 

corporation, The Nasdaq Stock Market, 

Inc. (‘‘Nasdaq’’),5 proposes to enter into 

a Nasdaq Stockholders’’ Agreement (the 

‘‘Agreement’’) with Borse Dubai Limited 

(‘‘Borse Dubai’’). There is no proposed 

rule text. 

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 

Nasdaq 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 

Nasdaq 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 November 15, 2007, Nasdaq 

entered into definitive agreements with 

Borse Dubai and BD Stockholm AB, and 

with Borse Dubai and Dubai 

International Financial Exchange 

(‘‘DIFX’’) (the ‘‘Definitive Agreements’’) 

pursuant to which (i) Borse Dubai will 

acquire up to 100% of the outstanding 

share capital of OMX AB (‘‘OMX’’) by 

means of a public tender offer, (ii) Borse 

Dubai will acquire shares of common 

stock of Nasdaq representing 

approximately 28% of its outstanding 

share capital, with the shares in excess 

of 19.9% held in a trust subject to an 

obligation to sell under certain 

conditions, (iii) Nasdaq will acquire 

33.3% of the outstanding share capital 

of DIFX, an exchange subsidiary of 

Borse Dubai, and (iv) Nasdaq will 

acquire up to 100% of the outstanding 

share capital of OMX from Borse Dubai 

(collectively, the ‘‘Transactions’’).6 The 


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1902 Federal Register / Vol. 73, No. 7 / Thursday, January 10, 2008 / Notices 

Form 8–K on November 16, 2007 and are available 

at http://www.sec.gov/Archives/edgar/data/ 

1120193/000119312507249279/d8k.htm. 

7As amended most recently on July 31, 2006. See 

Securities Exchange Act Release No. 53128 (January 

13, 2006), 71 FR 3550 (January 23, 2006). 

8These provisions relating to the Borse Dubai 

Designees remain in effect as long as Borse Dubai 

maintains at least 50% of its initial 19.9% direct 

investment in Nasdaq. As long as Borse Dubai 

maintains at least 25% of this investment, it will 

be entitled to propose one director for nomination, 

but will have no rights with regard to committees. 

9An exception to the requirement of nomination 

by the Nominating Committee exists for 

nominations by a stockholder who is conducting a 

proxy contest and who complies with the strict 

requirements of the Nasdaq By-Laws governing 

direct stockholder nomination. The Board 

Designees would not be nominated by Borse Dubai 

under these provisions. 

10Currently, the Nasdaq By-Laws provide that the 

Nominating Committee must be composed of 

directors in their final year of service on the Nasdaq 

Board or other persons who are not officers or 

employees of Nasdaq. Rule 4350, which governs 

Nasdaq as a company whose securities are listed on 

the Nasdaq Exchange, requires Nominating 

Committee members to satisfy the definition of 

‘‘independence’’ in Nasdaq Exchange Rule 4200 

and IM–4200 and to otherwise be deemed 

independent by the Nasdaq Board. In the future, 

Nasdaq may propose a by-law amendment to 

require all Nominating Committee members to be 

directors (with no limitation as to length of service), 

but Rule 4350 would continue to apply in that 

event. 

11 17 CFR 240.10A–3. 

12 15 U.S.C. 78f. 

13 15 U.S.C. 78f(b)(1), (5). 

14 15 U.S.C. 78s(b)(3)(A). 

15 17 CFR 240.19b–4(f)(6). 

16 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–

4(f)(6)(iii) requires that a SRO submit to the 

shares held by Borse Dubai directly and 

in the trust will be subject to Article 

Fourth of Nasdaq’s Restated Certificate 

of Incorporation,7 which provides that 

no person who is the beneficial owner 

of voting securities of Nasdaq in excess 

of 5% of the then-outstanding shares of 

stock generally entitled to vote (‘‘Excess 

Securities’’) may vote such Excess 

Securities. 

At the time of the closing of the 

Transactions, Nasdaq and Borse Dubai 

will enter into the Agreement, under 

which, among other things, Borse Dubai 

will have the right to recommend two 

persons reasonably acceptable to the 

Nasdaq Nominating Committee (the 

‘‘Board Designees’’) to serve as directors 

of Nasdaq. Under the Agreement, 

Nasdaq will: (i) Include the Board 

Designees on each slate of nominees 

proposed by management of Nasdaq; (ii) 

recommend the election of the Board 

Designees to the stockholders of Nasdaq; 

and (iii) otherwise use reasonable best 

efforts to cause the Board Designees to 

be elected to the Board of Directors. 

Nasdaq has also agreed to use 

reasonable best efforts to cause the 

appointment of one of the Board 

Designees to the Audit, Executive, 

Finance, and Management 

Compensation committees of the Board 

of Directors, and to cause the 

appointment of another person 

designated by Borse Dubai to serve on 

the Nominating Committee (the 

‘‘Nominating Committee Designee’’, and 

together with the Board Designees, the 

‘‘Borse Dubai Designees’’), but in each 

case only if such person meets the 

requirements for service on the 

committee.8

The Agreement relates solely to the 

Board of Directors of Nasdaq, and not to 

the boards of any of its subsidiaries, 

including the Board of Directors of the 

Nasdaq Exchange. Nevertheless, the 

provisions of the Agreement described 

above could be considered a proposed 

rule change of the Nasdaq Exchange, if 

they were viewed as affecting the 

influence that a significant stockholder 

of Nasdaq might be seen as exercising 

over the business and affairs of the 

Nasdaq Exchange in its capacity as a 

wholly owned subsidiary of Nasdaq. 

In general, directors of Nasdaq, 

including the Board Designees, must be 

nominated by a Nominating 

Committee,9 the composition of which 

is subject to the requirements of the 

Nasdaq By-Laws and Nasdaq Exchange 

Rule 4350,10 and must then be elected 

by the stockholders of Nasdaq. The 

Nasdaq Board is currently composed of 

13 members, but will be expanded to 16 

members at the time of the closing of the 

Transactions. Thus, the Board Designees 

would represent 12.5% of the Nasdaq 

Board. 

The committees that are the subject of 

the Agreement are subject to 

compositional requirements established 

by the Nasdaq By-Laws; moreover, the 

Audit, Management Compensation, and 

Nominating Committees are subject to 

independence requirements established 

by Nasdaq Exchange Rule 4350 and, in 

the case of the Audit Committee, by 

10A–3 under the Act.11 Thus, 

depending on the affiliations of the 

Borse Dubai Designees and the 

judgment of the Nasdaq Board with 

regard to their independence, they 

would not be eligible for service on 

these three committees. Each of these 

committees currently has between four 

and seven members. Upon the closing of 

the Transactions, the size of each 

committee would remain the same or 

grow to reflect the increased size of the 

whole Board. Thus, each of the 

committees on which a Borse Dubai 

Designee serves will include at least five 

directors. 

2. Statutory Basis 

The Nasdaq Exchange believes that 

the proposed rule change is consistent 

with the provisions of section 6 of the 

Act,12 in general, and with sections 

6(b)(1) and (b)(5) of the Act,13 in 

particular, in that the proposal enables 

the Nasdaq Exchange to be so organized 

as to have the capacity to be able to 

carry out the purposes of the Act and to 

comply with and enforce compliance by 

members and persons associated with 

members with provisions of the Act, the 

rules and regulations thereunder, and 

self-regulatory organization (‘‘SRO’’) 

rules, and is 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. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Nasdaq Exchange does not 

believe that the proposed rule change 

will result in any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act, as amended. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

Written comments on the proposed 

rule change were neither solicited nor 

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, if consistent with the 

protection of investors and public 

interest, it has become effective 

pursuant to section 19(b)(3)(A) of the 

Act 14 and Rule 19b–4(f)(6) 

thereunder.15

A proposed rule change filed under 

19b–4(f)(6) may not become operative 

prior to 30 days after the date of filing 

unless the Commission designates a 

shorter time if such action is consistent 

with the protection of investors and the 

public interest.16 The Nasdaq Exchange 


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Federal Register / Vol. 73, No. 7 / Thursday, January 10, 2008 / Notices 1903 

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 Commission 

notes that the Nasdaq Exchange has satisfied the 

five-day pre-filing notice requirement. 

17 17 CFR 240.19b–4(f)(6)(iii). 

18For purposes only of waiving the 30-day 

operative delay of this proposal, the Commission 

has considered the proposed rule’s impact on 

efficiency, competition, and capital formation. 15 

U.S.C. 78c(f). 

19 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Securities Exchange Act Release No. 56819 

(November 19, 2007), 72 FR 66214. 

4 ‘‘Obvious Error’’ is defined in NYSE Arca Rule 

6.87(a)(1). 

5The Exchange represents that a designee of the 

CRO would be an employee of the Exchange, 

working closely with and reporting directly to, the 

CRO, such as one of the Directors of Options 

Regulation. 

6The Exchange proposes to designate at least ten 

OTP Firm representatives to be called upon to serve 

on the OE Panel. In no case would the OE Panel 

include a person related to a party to the trade in 

question. To the extent reasonably possible, the 

Exchange proposes to call upon the designated 

representatives to participate on an OE Panel on an 

equally frequent basis. 

has requested that the Commission 

waive the 30-day operative delay set 

forth in Rule 19b–4(f)(6)(iii) under the 

Act 17 to ensure that the filing is 

effective and therefore does not delay 

the commencement of the offer or the 

closing of the Transactions. The parties 

to the Transactions expect all regulatory 

actions necessary for the closing of the 

Transactions to be completed prior to 

Borse Dubai commencing its offer for 

OMX shares. The Commission believes 

that the earlier operative date is 

consistent with the protection of 

investors and the public interest. 

Accordingly, the Commission 

designates the proposal to be operative 

upon filing with the Commission.18

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

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. 

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 e-mail to rulecomments@sec.gov. Please include File 

Number SR–NASDAQ–2008–002 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Nancy M. Morris, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR-NASDAQ–2008–002. This 

file number should be included on the 

subject line if e-mail 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 inspection and copying 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 such filing also will be 

available for inspection and copying at 

the principal office of the Nasdaq 

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–

NASDAQ–2008–002 and should be 

submitted on or before January 31, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E8–187 Filed 1–9–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–57103; File No. SR–

NYSEArca–2007–115] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Order Granting Approval of 

a Proposed Rule Change Relating to 

Rule 6.87—Obvious Error 

January 4, 2008. 

On November 8, 2007, NYSE Arca, 

Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

to section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to amend NYSE Arca Rule 6.87 

governing obvious errors to revise the 

review procedure for contesting 

decisions made pursuant to the rule. 

The proposed rule change was 

published for comment in the Federal 

Register on November 27, 2007.3 The 

Commission received no comment 

letters on the proposal. This order 

approves the proposed rule change. 

Currently, NYSE Arca Rule 6.87 

provides that the Exchange will 

determine whether a transaction 

resulted from an ‘‘Obvious Error’’ 4 after 

it receives notification within the 

prescribed time frame. If the Exchange 

believes that an Obvious Error has 

occurred, the Exchange will adjust the 

price of the trade, with or without an 

adjustment penalty, or will nullify the 

trade, depending on the status of the 

parties to the trade. Currently, a party 

may appeal the Exchange’s decision to 

the Exchange’s Board of Directors 

(‘‘Board’’) pursuant to NYSE Arca Rule 

10.14. 

The Exchange proposes to eliminate a 

party’s right to appeal to the Board and 

instead allow a party to appeal to an 

Obvious Error Panel (‘‘OE Panel’’). The 

OE Panel would be composed of the 

Exchange’s Chief Regulatory Officer 

(‘‘CRO’’), or a designee of the CRO,5 and 

representatives from two options trading 

permit firms (‘‘OTP Firms’’).6 One OE 

Panel representative would be from an 

OTP Firm directly engaged in market 

making activities and one OE Panel 

representative would be from an OTP 

Firm directly engaged in the handling of 

options orders for public customers. 

In addition, requests for an appeal 

would have to be made via facsimile or 

e-mail within thirty minutes after the 

party requesting the appeal is given 

notification of the initial determination. 

Thereafter, the OE Panel would review 

the information and may overturn or 

modify the action previously taken by 

the Exchange. Such determination by 

the OE Panel would be considered a 

final action by the Exchange on the 

matter at issue. All final determinations 

made by the OE Panel would be 

rendered, without prejudice, as to the 

rights of the parties to the transaction to 

submit their dispute to arbitration. The 


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