Document ID: SEC-2006-0614-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc.
Posted Date: 2006-05-12T04:00Z

[Federal Register: May 12, 2006 (Volume 71, Number 92)]
[Notices]               
[Page 27763-27764]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12my06-115]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53769; File No. SR-NASD-2006-041]

 
Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change, and Amendment No. 1 thereto, To Eliminate From The Nasdaq 
Stock Market Inc.'s Corporate Organizational Documents Certain Series 
of Preferred Stock

May 8, 2006.
    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 March 31, 2006, the National Association of Securities Dealers, Inc. 
(``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc. 
(``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. On April 24, 
2006, Nasdaq filed Amendment No. 1 to the proposed rule change.\3\ 
Nasdaq filed this proposal pursuant to section 19(b)(3)(A) of the Act 
\4\ and Rule 19b-4(f)(3) thereunder \5\ as concerned solely with the 
administration of the self-regulatory organization, and, therefore, 
this proposal is effective immediately upon filing. The Commission is 
publishing this notice to solicit comments on the proposed rule change, 
as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ In Amendment No. 1, Nasdaq made clarifying changes to the 
proposal and attached as Exhibit 5 to the filing a copy of the 
Certificate of Elimination of the Series A Cumulative Preferred 
Stock, Series B Preferred Stock and Series C Cumulative Preferred 
Stock of The Nasdaq Stock Market, Inc.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(f)(3).
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    Nasdaq proposes to proposal to eliminate from Nasdaq's corporate 
organizational documents references to Series A Cumulative Preferred 
Stock, Series B Preferred Stock, and Series C Cumulative Preferred 
Stock, as there are no shares of any such series outstanding.

[[Page 27764]]

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, as 
amended, 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
    Nasdaq wishes to eliminate its Certificate of Designations, 
Preferences and Rights of Series A Cumulative Preferred Stock, its 
Certificate of Designations, Preferences and Rights of Series B 
Preferred Stock, its Certificate of Designations, Preferences and 
Rights of Series C Cumulative Preferred Stock, and all matters set 
forth therein. Nasdaq's Series A and Series B preferred stock were both 
created in 2002; the Series C preferred stock was created in 2004. In 
2004, all outstanding shares of the Series A preferred were exchanged 
for the shares of Series C preferred. In 2005, the sole outstanding 
share of Series B preferred was exchanged for a share of Nasdaq's 
Series D preferred stock.\6\ Finally, in 2006, Nasdaq acquired all 
outstanding shares of the Series C preferred stock. As a result, today 
there remains only one share of Nasdaq's preferred stock outstanding--a 
share of Series D preferred.
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    \6\ See Securities Exchange Act Release No. 53022 (December 23, 
2005); 70 FR 77433 (December 30, 2005).
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    Under Delaware law, both a certificate of designations (designating 
a series of preferred stock) and a certificate of elimination 
(eliminating a previously adopted designation) are deemed to be 
amendments to Nasdaq's Restated Certificate of Incorporation. 
Therefore, Nasdaq is making this filing with the Commission. Nasdaq is 
not, at this time, restating its Restated Certificate of 
Incorporation.\7\
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    \7\ See Amendment No. 1.
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2. Statutory Basis
    Nasdaq believes that the proposed rule change, as amended, is 
consistent with the provisions of section 15A of the Act,\8\ in general 
and with section 15A(b)(6) of the Act,\9\ in particular. The proposal 
is ministerial in nature and will not affect the rights of market 
participants.
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    \8\ 15 U.S.C. 78o-3.
    \9\ 15 U.S.C. 78o-3(b)(6).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Nasdaq does not believe that the proposed rule change, as amended, 
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

    This proposal, as amended, has become effective pursuant to section 
19(b)(3)(A) of the Act \10\ and subparagraph (f)(3) of Rule 19b-4 
thereunder \11\ because the proposal is concerned solely with the 
administration of the self-regulatory organization.
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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(3).
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    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, as amended, 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 rule-comments@sec.gov. Please include 

File Number SR-NASD-2006-041 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASD-2006-041. 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, as 
amended, 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. Copies of such filing also will be available for 
inspection and copying at the principal office of the NASD. 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-NASD-2006-041 and 
should be submitted on or before June 2, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-7269 Filed 5-11-06; 8:45 am]

BILLING CODE 8010-01-P