[Federal Register Volume 68, Number 91 (Monday, May 12, 2003)]
[Notices]
[Pages 25402-25404]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-11729]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-47801; File No. SR-NASD-2003-76]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the National Association of 
Securities Dealers, Inc. To Restate the Certificate of Incorporation of 
The Nasdaq Stock Market, Inc.

May 6, 2003.
    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 April 29, 2003, 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. Nasdaq has 
designated this proposal as one concerned solely with the 
administration of the self-regulatory organization under section 
19(b)(3)(A)(iii) of the Act \3\ and rule 19b-4(f)(3) thereunder,\4\ 
which renders the rule effective upon filing with the Commission. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78S(b)(3)(A)(iii).
    \4\ 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 is restating (but not substantively amending) its 
certificate of incorporation. The text of the proposed rule change is 
below. Proposed new language is italicized; proposed deletions are in 
brackets.

Restated Certificate of Incorporation of The Nasdaq Stock Market, Inc.

    The undersigned, ------, the ------ of The Nasdaq Stock Market, 
Inc. (``Nasdaq''), a Delaware corporation, does hereby certify:
    First: That the name of the corporation is The Nasdaq Stock Market, 
Inc. The date of the filing of its original Certificate of 
Incorporation with the Secretary of State of the State of Delaware was 
November 13, 1979. The name under which Nasdaq was originally 
incorporated was ``NASD Market Services, Inc.''
    Second: That the Restated Certificate of Incorporation of Nasdaq 
dated June 27, 2000, as previously amended by the Certificate of 
Designations, Preferences and Rights of Series A Cumulative Preferred 
Stock dated March 8, 2002, the Certificate of Designations, Preferences 
and Rights of Series B Preferred Stock dated March 8, 2002, and the 
Certificate of Amendment dated August 7, 2002, is hereby [amended and] 
restated and integrated to read in its entirety as follows:

Article First--Article Third

    No change.

Article Fourth

    A. No change.
    B. The Preferred Stock may be issued from time to time in one or 
more series. The Board of Directors of Nasdaq (the ``Board'') is hereby 
authorized to provide for the issuance of shares of Preferred Stock in 
one or more series and, by filing a certificate pursuant to the 
applicable law of the State of Delaware (hereinafter referred to as 
``Preferred Stock Designation''), to establish from time to time the 
number of shares to be included in each such series, and to fix the 
designation, powers, preferences and rights of the shares of each such 
series and the qualifications, limitations and restrictions thereof. 
The authority of the Board with respect to each series shall include, 
but not limited to, determination of the following:
    (1) The designation of the series, which may be by distinguishing 
number, letter or title.
    (2) The number of shares of the series, which number the Board may 
thereafter (except where otherwise provided in the Preferred Stock 
Designation) increase or decrease (but not below the number of shares 
thereof then outstanding).
    (3) The amounts payable on, and the preferences, if any, of shares 
of the series in respect of dividends, and whether such dividends, if 
any, shall be cumulative or noncumulative.
    (4) Dates at which dividends, if any, shall be payable.
    (5) The redemption rights and price or prices, if any, for shares 
of the series.
    (6) The terms and amount of any sinking fund provided for the 
purchase or redemption of shares of the series.
    (7) The amounts payable on, and the preferences, if any, of shares 
of the series in the event of any voluntary or involuntary liquidation, 
dissolution or winding up of the affairs of Nasdaq.
    (8) Whether the shares of the series shall be convertible into or 
exchangeable for shares of any other class or series, or any other 
security, of Nasdaq or any other corporation, and, if so, the 
specification of such other class or series or such other security, the 
conversion or exchange price or prices or rate or rates, any 
adjustments thereof, the date or dates at which such shares shall be 
convertible or exchangeable and all other terms and conditions upon 
which such conversion or exchange may be made.
    (9) Restrictions on the issuance of shares of the same series or of 
any other class or series.
    (10) The voting rights, if any, of the holders of shares of the 
series. Pursuant to the foregoing authority, the Board has previously 
authorized the issuance of (i) Series A Cumulative Preferred Stock by 
filing a Certificate of Designations, Preferences and Rights with the 
Secretary of State of the State of Delaware on March 8, 2002, and (ii) 
Series B Preferred Stock by filing a Certificate of Designations, 
Preferences and Rights with the Secretary of State of the State of 
Delaware on March 8, 2002. The number of shares included in the Series 
A Cumulative Preferred Stock, the powers, preferences and rights of the 
shares of such series, and the qualifications, limitations and 
restrictions thereof are set forth in Annex A hereto, and the number of 
shares included in the Series B Preferred Stock, the powers, 
preferences and rights of the shares of such series, and the 
qualifications, limitations and restrictions thereof are set forth in 
Annex B hereto.
    C. No change.

Article Fifth--Article Eleventh

    No change.
    Third: That such Restated Certificate of Incorporation has been 
duly adopted by Nasdaq in accordance with the applicable provisions of 
Section[s 242 and] 245 of the General Corporation Law of the State of 
Delaware [and in accordance with Section 228 of the General Corporation 
Law of the State of Delaware (by the written consent of its sole 
stockholder).];
    Fourth: That such Restated Certificate of Incorporation only 
restates and integrates and does not further amend the provisions of 
Nasdaq's certificate of incorporation as heretofore amended or 
supplemented, and that there is no discrepancy between those provisions

[[Page 25403]]

and the provisions of such Restated Certificate of Incorporation.
    In witness whereof, the undersigned has executed this certificate 
this ---- day of ------, 2003.
The Nasdaq Stock Market, Inc.
By:--------------------------------------------------------------------
 (signature)

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 (printed name)

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 (title)

[Certificate of Designations, Preferences and Rights of Series a 
Cumulative Preferred Stock of The Nasdaq Stock Market, Inc.]

[Pursuant to section 151 of the Delaware General Corporation Law]

    [The Nasdaq Stock Market, Inc., a Delaware corporation (the 
``Corporation''), certifies that pursuant to the authority contained in 
its Restated Certificate of Incorporation (the ``Certificate of 
Incorporation'') and in accordance with the provisions of section 151 
of the General Corporation Law of the State of Delaware, the Board of 
Directors of the Corporation (the ``Board of Directors''), acting by 
unanimous written consent, adopted the following resolution, which 
resolution remains in full force and effect as of the date hereof:]
    [Does hereby certify that:]

    [Resolved, that there is hereby established a series of authorized 
preferred stock consisting of 1,338,402 shares, which series shall have 
the following powers, designations, preferences and relative, 
participating, optional or other rights, and the following 
qualifications, limitations and restrictions (in addition to any 
powers, designations, preferences and relative, participating, optional 
or other rights, and any qualifications, limitations and restrictions, 
set forth in the Certificate of Incorporation):]

Annex A

    Section 1--Section 13. No change.
    [In witness whereof, the undersigned has caused this Certificate of 
Designations to be executed this ------ day of ------, 2002.]
[The Nasdaq Stock Market, Inc.]
[By: ------------]
[Name:]
[Title:]
Schedule A
    No change.

[Certificate of Designations, Preferences and Rights of Series B 
Preferred Stock of The Nasdaq Stock Market, Inc.]

[Pursuant to Section 151 of the Delaware General Corporation Law]

    [The Nasdaq Stock Market, Inc., a Delaware corporation (the 
``Corporation''), certifies that pursuant to the authority contained in 
its Restated Certificate of Incorporation (the ``Certificate of 
Incorporation'') and in accordance with the provisions of Section 151 
of the General Corporation Law of the State of Delaware, the Board of 
Directors of the Corporation (the ``Board of Directors''), acting by 
unanimous written consent, adopted the following resolution, which 
resolution remains in full force and effect as of the date hereof:]

[Does hereby certify that:]

    [Resolved, that there is hereby established a series of authorized 
preferred stock consisting of one share, which series shall have the 
following powers, designations, preferences and relative, 
participating, optional or other rights, and the following 
qualifications, limitations and restrictions (in addition to any 
powers, designations, preferences and relative, participating, optional 
or other rights, and any qualifications, limitations and restrictions, 
set forth in the Certificate of Incorporation):]

ANNEX B

    Section 1--Section 13. No change.
    [In witness whereof, the undersigned has caused this Certificate of 
Designations to be executed this------day of ------, 2002.]
[The Nasdaq Stock Market, Inc.]
[By: ------------]
[Name: ]
[Title:]

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
    Nasdaq is restating its certificate of incorporation as a single 
document. Nasdaq's certificate of incorporation currently comprises the 
Restated Certificate of Incorporation dated June 27, 2000,\5\ the 
Certificate of Designations, Preferences and Rights of Series A 
Cumulative Preferred Stock dated March 8, 2002, and the Certificate of 
Designations, Preferences and Rights of Series B Preferred Stock dated 
March 8, 2002,\6\ and the Certificate of Amendment dated August 7, 
2002.\7\ It is necessary to make several non-substantive modifications 
to the wording of several of these documents, to allow their assembly 
into a single, internally consistent document with appropriate internal 
cross-references. Under Delaware corporate law, the integration of a 
certificate of incorporation into a single restated document, but 
without substantive amendment, is required to be approved by a 
corporation's board of directors but not its stockholders.\8\ On 
January 29, 2003, the Nasdaq Board of Directors provided the approval 
required under Delaware law. Nasdaq will file the restated certificate 
of incorporation with the Secretary of State of the State of Delaware 
promptly after the submission of this proposed rule change to the 
Commission.
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    \5\ See Securities Exchange Act Release No. 42983 (June 26, 
2000), 65 FR 41116 (July 3, 2000) (SR-NASD-00-27).
    \6\ See Securities Exchange Act Release No. 45638 (March 25, 
2002), 67 FR 15268 (March 29, 2002) (SR-NASD-2002-36).
    \7\ See Securities Exchange Act Release No. 45135 (December 5, 
2001), 66 FR 64327 (December 12, 2001) (SR-NASD-2001-34); Securities 
Exchange Act Release No. 46060 (June 11, 2002), 67 FR 41558 (June 
18, 2002) (SR-NASD-2002-64).
    \8\ 8 Del. C. 245.
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2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of section 15A of the Act,\9\ in general, and with 
section 15A(b)(2) of the Act,\10\ in particular, in that it is 
consistent with Nasdaq being so organized and having the capacity to be 
able to carry out the purposes of the Act and to comply with and 
enforce compliance with the provisions of the Act.
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    \9\ 15 U.S.C. 78o-3.
    \10\ 15 U.S.C. 78o-(b)(2).

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[[Page 25404]]

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

    The foregoing rule change has become effective pursuant to section 
19(b)(3)(A)(iii) of the Act \11\ and subparagraph (f)(3) of rule 19b-4 
thereunder,\12\ because it is concerned solely with the administration 
of the self-regulatory organization. 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.
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    \11\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \12\ 17 CFR 240.19b-4(f)(3).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change in consistent with the Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
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. Copies of such filing will also be 
available for inspection and copying at the principal office of the 
NASD. All submissions should refer to file number SR-NASD-2003-76 and 
should be submitted by June 2, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-11729 Filed 5-9-03; 8:45 am]
BILLING CODE 8010-01-P