Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 6241 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Nasdaq interprets the requirement to disclose 

information through the news media to be satisfied 

by the issuance of a press release. 

4 17 CFR 243.100–103. Regulation FD permits a 

company to disclose material information using a 

method (or combination of methods) of disclosure 

that is reasonably designed to provide broad, nonexclusionary distribution of the information to the 

public. 

5Exchange Act Release No. 46901 (November 25, 

2002), 67 FR 72011 (December 3, 2002). 

6Exchange Act Release No. 49424 (March 16, 

2004), 69 FR 15594 (March 25, 2004). 

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–2010–013 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NASDAQ–2010–013. 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 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 No. 

SR–NASDAQ–2010–013 and should be 

submitted on or before March 1, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2584 Filed 2–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61461; File No. SR– 

NASDAQ–2010–006] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing of Proposed Rule Change To 

Modify the Press Release 

Requirements for Listed Companies 

February 1, 2010. 

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 

13, 2010, The NASDAQ Stock Market 

LLC (‘‘Nasdaq’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by Nasdaq. 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 the Substance 

of the Proposed Rule Change 

Nasdaq proposes to modify certain of 

the press release requirements for listed 

companies. Nasdaq will implement the 

proposed rule upon approval. The text 

of the proposed rule change is available 

from Nasdaq’s Web site at http:// 

nasdaq.cchwallstreet.com, at Nasdaq’s 

principal office, 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, 

Nasdaq 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. Nasdaq 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 

There are a number of Nasdaq rules 

related to the issuer compliance process 

that require a company to disclose 

information in a press release or through 

the news media.3 These rules generally 

were adopted to address inconsistent 

issuer disclosure practices and reflected 

the view, prevalent at that time, that 

issuing a press release was the only way 

to assure wide dissemination of an 

important event. However, in 2002, after 

the Commission adopted Regulation 

FD,4 Nasdaq amended its rules to allow 

listed companies to provide disclosure 

of material news via any Regulation FD 

compliant means.5 Since that time 

Nasdaq has had the opportunity to 

observe market reaction to news 

disclosed in ways other than via a press 

release. Nasdaq’s experience since 

adopting this rule indicates that there is 

broad acceptance of Regulation FD 

compliant methods of disclosure, such 

as through the use of a Form 8–K. 

In addition, the Commission has 

substantially modified its rules 

regarding the disclosure of information 

on a Form 8–K.6 As a result Nasdaq’s 

requirements in some instances are 

duplicative of the Form 8–K 

requirements and Nasdaq sees 

companies forced to make multiple 

disclosures regarding the same event. 

Nasdaq believes that investors have 

come to rely upon Form 8–K disclosure 

and notes that Form 8–K disclosures are 

readily available to investors and the 

information reported on them is widely 

reported on by the news media. As 

such, to the extent information is 

reported on a Form 8–K, Nasdaq 

believes that duplicate disclosure 

through a press release is unnecessary 

and an extra burden on listed 

companies. 

Given the foregoing, Nasdaq believes 

it is appropriate to modify the following 

rules to permit disclosure either through 

a press release or by filing a Form 8–K 

where required by Commission rules: 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

6242 Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 

7Rule 5805(a) defines an ‘‘Adjudicatory Body’’ as 

the Hearings Panel, the Nasdaq Listing and Hearing 

Review Council, or the Nasdaq Board, or a member 

thereof. 8Current Rule 5250(b)(3) is also renumbered by 

this filing as Rule 5250(b)(2). 9 Item 3.01 of Form 8–K requires a company to 

file a Form 8–K when it receives notice from 

Nasdaq that the company does not satisfy a listing 

standard or when Nasdaq issues a Public 

Reprimand Letter to the company. As such, 

Nasdaq’s requirements are, in some cases, 

duplicative of the Form 8–K disclosure requirement 

and a company could be required to issue a press 

release under Nasdaq’s rules and a Form 8–K under 

the Commission’s rules containing the same 

information. A company could satisfy the revised 

requirement by filing the required Form 8–K, 

thereby eliminating this dual disclosure and any 

confusion it creates, while ensuring that the 

information remains publicly disclosed. 

10The Commission notes that Nasdaq recently 

filed a proposed rule change that provides that if 

the public release of material information is made 

outside of Nasdaq market hours, companies must 

notify MarketWatch of the material information 

prior to 6:50 a.m. ET. See NASDAQ–2010–008. 

11Exchange Act Release No. 48745 (November 4, 

2003), 68 FR 64154 (November 12, 2003). 

12 17 CFR 240.14a–1. See Item 13 of Schedule 

14A, 17 CFR 240.14a–101. 

13Rule 2–01 of Regulation S–X, 17 CFR 210.2–01. 

14Nasdaq is also proposing to make a conforming 

change to Rule 5615(a)(3) to eliminate the reference 

to the going concern requirement because it will no 

longer apply. In addition, Nasdaq is proposing to 

remove the reference in Rule 5615(a)(3) to the 

requirement for a foreign private issuer to enter into 

a listing agreement because there is no need to 

single out this requirement from all the others of the 

requirements of the Rule 5000 Series to which a 

foreign private issuer is subject. 

15 17 CFR 240.12d2–2(c). 

16Under these rules, a company must notify the 

MarketWatch, Listing Qualifications, and Hearings 

Departments. 

17Companies are already required to use the 

electronic disclosure submission service to notify 

MarketWatch prior to the distribution of material 

news. See Rule 5250(b)(1) and IM–5250–1. See also 

Exchange Act Release No. 55856 (June 4, 2007), 72 

FR 32383 (June 12, 2007) (approving SR–NASDAQ– 

2007–029). 

18Nasdaq is also proposing: (i) to add a title to 

Rule 5250(b)(1) to clarify the text; and (ii) to use 

capitalization for a defined term in Rule 5615. 

These are non-substantive changes. 

19 15 U.S.C. 78f. 

20 15 U.S.C. 78f(b)(5). 

• Rules 5250(b)(3), 5810(b), 5840(k) 

and IM–5810–1, which require 

disclosure of notifications from Nasdaq 

staff or an Adjudicatory Body 7

regarding a company’s compliance with 

the listing standards. Rules 5250(b)(3) 

and 5810(b) require a company to ‘‘make 

a public announcement through the 

news media’’ disclosing the receipt of a 

notice that the company does not meet 

a listing standard, that staff has 

determined to delist the company, or 

that is a Public Reprimand Letter.8 IM– 

5810–1 provides the time frame for 

companies to make these disclosures 

and describes the consequences of 

failing to do so. Rule 5840(k) requires 

that a company that receives a Public 

Reprimand Letter from an Adjudicatory 

Body must make ‘‘a public 

announcement through the news media’’ 

disclosing receipt of that letter. Nasdaq 

proposes to modify these rules to allow 

the company, in each case, to make a 

public announcement by ‘‘filing a Form 

8–K, where required by SEC rules, or by 

issuing a press release.’’ 9 However, a 

company that is late in filing a required 

periodic report with the Securities and 

Exchange Commission would still be 

required to issue a press release 

announcing that it has received notice 

that it does not meet that requirement. 

Nasdaq also proposes to clarify in each 

of these rules that notification of these 

disclosures should be made to the 

MarketWatch Department through 

Nasdaq’s electronic disclosure 

submission system at least ten minutes 

prior to the notification to the public.10

• Rule 5635(f), which requires a 

company to ‘‘make a public 

announcement through the news media’’ 

when it receives an exception to the 

shareholder approval requirements 

because compliance would jeopardize 

the company’s financial viability. 

Nasdaq proposes instead to allow 

companies to make this announcement 

‘‘by filing a Form 8–K, where required 

by SEC rules, or by issuing a press 

release.’’ Nasdaq notes that companies 

that receive an exemption are also 

required to mail this notice to all 

shareholders at least ten days before 

issuing securities in reliance on the 

exception. 

• Rule 5225(a)(3), which requires a 

company to ‘‘publicize through, at a 

minimum, a public announcement 

through the news media’’ any change in 

the terms of a listed unit. Nasdaq 

proposes to modify this rule to allow the 

company to ‘‘make a public 

announcement by filing a Form 8–K, 

where required by SEC rules, or by 

issuing a press release’’ of any change in 

the terms of the unit. 

Similarly, Rule 5250(c)(2) requires a 

company that is a foreign private issuer 

to disclose interim financial results ‘‘in 

a press release and on a Form 6–K.’’ 

Nasdaq proposes to eliminate the 

requirement that this information be 

published in a press release, while 

maintaining the requirement that it be 

on a Form 6–K. A foreign private issuer 

would still be free to disclose this 

information in a press release if it 

chooses. 

Nasdaq proposes to eliminate the 

requirement contained in Rule 

5250(b)(2) that a company issue a press 

release announcing the receipt of an 

audit opinion that expresses doubt 

about the ability of the company to 

continue as a going concern. This 

requirement, which was adopted in 

2003,11 is duplicative of disclosure 

already provided in the Company’s 

annual filing with the Commission, 

which must be made available to all 

shareholders under Nasdaq rules, and 

which must be distributed to 

shareholders under the Commission’s 

Proxy Rules.12 Under these rules, a 

company must include the audit 

opinion in its annual report, without 

regard to whether it expresses doubt 

about the ability of the company to 

continue as a going concern.13 Given 

that the audit opinion is already 

required to be publicly disclosed, 

Nasdaq has found that the separate 

press release announcing the receipt of 

the opinion is duplicative and therefore 

can be confusing to investors. Of course 

if a company fails to include the audit 

opinion in its annual filing, Nasdaq 

would consider the filing deficient and 

would move to delist the company on 

that basis.14

Nasdaq is not proposing any change 

to Rule 5840(j), regarding the voluntary 

delisting of a company, because the 

press release requirement in that rule is 

required by Exchange Act Rule 12d2– 

2(c).15 Nasdaq is also maintaining the 

requirement in Rule 5635(c)(4) and IM– 

5365–1, which require that a company 

relying on the inducement exception to 

the requirement to obtain shareholder 

approval for equity compensation 

awards must ‘‘disclose in a press 

release’’ specific information about the 

equity award. 

Finally, Rules 5810(b) and 5840(k) 

require companies to notify multiple 

Nasdaq departments before they issue 

certain disclosures.16 These duplicative 

notice requirements are burdensome to 

listed companies and provide no 

regulatory benefit to Nasdaq. As a result, 

Nasdaq proposes to modify these rules 

to require companies to provide these 

disclosures to the MarketWatch 

Department using the electronic 

disclosure submission system accessible 

at http://www.nasdaq.net.17

MarketWatch will notify other Nasdaq 

departments when necessary.18

2. Statutory Basis 

Nasdaq believes that the proposed 

rule change is consistent with the 

provisions of Section 6 of the Act,19 in 

general and with Sections 6(b)(5) of the 

Act,20 in particular in that it 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 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES

Federal Register / Vol. 75, No. 25 / Monday, February 8, 2010 / Notices 6243 

21The text of the proposed rule change is 

available on the Commission’s Web site at http:// 

www.sec.gov. 

22 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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 

proposed rule change is designed to 

facilitate companies’ compliance with 

Nasdaq rules by aligning Nasdaq’s 

disclosure requirements with those of 

the Commission. Nasdaq notes that the 

proposed changes to permit disclosure 

by a Form 8–K will not eliminate or 

reduce information now available to 

investors, but will minimize duplicative 

disclosures. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

Nasdaq 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 were neither 

solicited nor received. 

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 self-regulatory 

organization 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 

No. SR–NASDAQ-2010–006 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File No. 

SR–NASDAQ–2010–006. 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,21 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 Nasdaq. 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 No. 

SR–NASDAQ–2010–006 and should be 

submitted on or before March 1, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–2633 Filed 2–5–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61466; File No. SR–CBOE– 

2010–005] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing of 

Proposed Rule Change, and 

Amendment No. 1 Thereto, To 

Establish Strike Price Intervals and 

Trading Hours for Options on IndexLinked Securities 

February 2, 2010. 

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 January 27, 2010, Chicago Board 

Options Exchange, Incorporated 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. On February 

2, 2010, CBOE filed Amendment No. 1 

to the proposed rule change. 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 

Prior to the commencement of trading 

options on Index-Linked Securities, 

CBOE proposes to establish strike price 

intervals and trading hours for these 

new products. The text of the proposed 

rule change is available on CBOE’s Web 

site at (http://www.cboe.org/legal), on 

the Commission’s Web site at http:// 

www.sec.gov, at CBOE, 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 

self-regulatory organization 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 those 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 parts of such 

statements. 

WReier-Aviles on DSKGBLS3C1PROD with NOTICES