Notices. SECURITIES AND EXCHANGE COMMISSION

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BILLING CODE 8010-01-M SECURITIES AND EXCHANGE COMMISSION [Release No. IC-27418] Notice of Applications for Deregistration Under Section 8(f) of the Investment Company Act of 1940 June 30, 2006. The following is a notice of applications for deregistration under section 8(f) of the Investment Company Act of 1940 for the month of June 2006. A copy of each application may be obtained for a fee at the SEC's Public Reference Branch (tel. 202-551-5850). An order granting each application will be issued unless the SEC orders a hearing.

Interested persons may request a hearing on any application by writing to the SEC's Secretary at the address below and serving the relevant applicant with a copy of the request, personally or by mail. Hearing requests should be received by the SEC by 5:30 p.m. on July 25, 2006, and should be accompanied by proof of service on the applicant, in the form of an affidavit or, for lawyers, a certificate of service. Hearing requests should state the nature of the writer's interest, the reason for the request, and the issues contested.

Persons who wish to be notified of a hearing may request notification by writing to the Secretary, U.S. Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. FOR FURTHER INFORMATION CONTACT: Diane L. Titus at

(202)551-6810, SEC, Division of Investment Management, Office of Investment Company Regulation, 100 F Street, NE., Washington, DC 20549-4041. Credit Suisse Target Return Fund [File No. 811-21617] *Summary:* Applicant seeks an order declaring that it has ceased to be an investment company. By May 17, 2006, applicants' sole shareholder had redeemed its shares at net asset value. Expenses of $2,500 incurred in connection with the liquidation were paid by applicant's investment adviser, Credit Suisse Asset Management, LLC, or its sister companies. *Filing Dates:* The application was filed on May 24, 2006, and amended on June 27, 2006. *Applicant's Address:* 466 Lexington Ave., New York, NY 10017-3140. Gold Bank Funds [File No. 811-10465] *Summary:* Applicant seeks an order declaring that it has ceased to be an investment company. On February 17, 2006 and April 7, 2006, applicant made liquidating distributions to its shareholders, based on net asset value. Expenses of $33,197 incurred in connection with the liquidation were paid by applicant and its investment advisers, Gold Capital Management, Inc. and M&I Investment Management Corp. *Filing Dates:* The application was filed on June 2, 2006, and amended on June 27, 2006. *Applicant's Address:* 6860 W. 115th, Suite 100, Overland Park, KS 66211. The Galaxy Fund [File No. 811-4636] *Summary:* Applicant seeks an order declaring that it has ceased to be an investment company. On November 21, 2005 and November 23, 2005, applicant transferred its assets to corresponding portfolios of Columbia Funds Series Trust, based on net asset value. Expenses of $936,930 incurred in connection with the reorganization were paid by Columbia Management Advisors, LLC, applicant's investment adviser. *Filing Dates:* The application was filed on April 20, 2006, and amended on June 22, 2006. *Applicant's Address:* One Financial Center, Boston, MA 02111. The BlackRock Advantage Term Trust Inc. [File No. 811-5757] *Summary:* Applicant, a closed-end investment company, seeks an order declaring that it has ceased to be an investment company. On December 29, 2005, applicant made a liquidating distribution to its shareholders, based on net asset value. Expenses of $18,500 incurred in connection with the liquidation were paid by applicant. Applicant has transferred $300,000 in cash to a liquidating trust to pay applicant's remaining liabilities. The trustees of the liquidating trust intend to distribute any remaining cash to applicant's former shareholders within one year of the liquidation. *Filing Date:* The application was filed on May 15, 2006. *Applicant's Address:* 100 Bellevue Parkway, Wilmington, DE 19809. Income Trust [File No. 811-7307] Growth and Income Trust [File No. 811-7393] Growth Trust [File No. 811-7395] *Summary:* Each applicant, a master fund in a master/feeder arrangement, seeks an order declaring that it has ceased to be an investment company. Between October 18, 2005 and March 9, 2006, each applicant's shareholders redeemed all their shares at net asset values. Expenses of $14,670, $19,560 and $9,780, respectively, incurred in connection with the liquidations were paid by Ameriprise Financial, Inc., applicants' investment adviser. *Filing Date:* The applications were filed on May 24, 2006. *Applicant's Address:* 901 Marquette Ave. South, Suite 2810, Minneapolis, MN 55402-3268. Allmerica Securities Trust [File No. 811-2338] *Summary:* Applicant, a closed-end investment company, seeks an order declaring that it has ceased to be an investment company. On May 12, 2006, applicant made a liquidating distribution to its shareholders, based on net asset value. The Bank of New York, applicant's paying agent, is holding the remaining fund assets for distribution to shareholders holding share certificates. Any liquidating distributions not claimed by a certificated shareholder will be escheated by the paying agent in accordance with relevant state law. Expenses of approximately $155,000 incurred in connection with the liquidation have been or will be paid by applicant. Applicant has retained $132,102 in cash in a custodial account to pay for expenses relating to the liquidation and other accrued or contingent liabilities. *Filing Date:* The application was filed on May 12, 2006. *Applicant's Address:* 440 Lincoln St., Worcester, MA 01653. Scudder New Asia Fund, Inc. [File No. 811-4789] *Summary:* Applicant, a closed-end investment company, seeks an order declaring that it has ceased to be an investment company. On April 17, 2006, applicant transferred its assets to DWS Emerging Markets Equity Fund, a series of DWS International Fund, Inc., based on net asset value. Expenses of $332,700 incurred in connection with the reorganization were paid by applicant. *Filing Dates:* The application was filed on May 11, 2006, and amended on June 9, 2006. *Applicant's Address:* 345 Park Avenue, New York, NY 10154. Meeder Advisor Funds [File No. 811-6720] *Summary:* Applicant seeks an order declaring that it has ceased to be an investment company. On November 13, 2003, applicant made a liquidating distribution to its shareholders, based on net asset value. Expenses of $1,465 incurred in connection with the liquidation were paid by applicant and Norwich Union Investment Management Limited, applicant's subadviser. *Filing Dates:* The application was filed on July 8, 2004, and amended on June 13, 2006. *Applicant's Address:* 6125 Memorial Dr., Dublin, OH 43017. AIM Millennium Alternative Strategies Fund [File No. 811-10299] *Summary:* Applicant, a closed-end investment company, seeks an order declaring that it has ceased to be an investment company. Applicant has never made a public offering of its securities and does not propose to make a public offering or engage in business of any kind. *Filing Dates:* The application was filed on March 31, 2003, and amended on May 12, 2003 and June 12, 2006. *Applicant's Address:* 11 Greenway Plaza, Suite 100, Houston, TX 77046-1173. Runkel Funds, Inc. [File No. 811-21070] *Summary:* Applicant seeks an order declaring that it has ceased to be an investment company. On October 20, 2005, applicant made a liquidating distribution to its shareholders, based on net asset value. Expenses of $4,087 incurred in connection with the liquidation were paid by Runkel Advisors, LLC, applicant's investment adviser, and Thomas J. Runkel, manager of applicant's investment adviser. *Filing Dates:* The application was filed on December 7, 2005, and amended on February 3, 2006, March 10, 2006 and June 23, 2006. *Applicant's Address:* 903 Chevy St., Belmont, CA 94002. Legg Mason Cash Reserve Trust [File No. 811-2853] Legg Mason Tax-Exempt Trust, Inc. [File No. 811-3526] *Summary:* Each applicant seeks an order declaring that it has ceased to be an investment company. On February 28, 2006, each applicant made a liquidating distribution to its shareholders, based on net asset value. Expenses of $36,099 and $11,984, respectively, incurred in connection with the liquidations were paid by Legg Mason Fund Adviser, Inc., applicants' investment adviser. *Filing Date:* The applications were filed on May 31, 2006. *Applicants' Address:* 100 Light St., Baltimore, MD 21202. Hart Life Insurance Company Separate Account One [File No. 811-9045] *Summary:* Applicant, a separate account for variable annuities, seeks an order declaring that it has ceased to be an investment company. Applicant has never made a public offering of its securities, does not propose to make a public offering, and has never had any contractowners invested in the separate account. *Filing Date:* The application was filed on April 25, 2006. *Applicant's Address:* P.O. Box 2999, Hartford, CT 06104. Hart Life Insurance Company Separate Account Two [File No. 811-9047] *Summary:* Applicant, a separate account for variable life insurance, seeks an order declaring that it has ceased to be an investment company. Applicant has never made a public offering of its securities, does not propose to make a public offering, and has never had any contractowners invested in the separate account. *Filing Date:* The application was filed on April 25, 2006. *Applicant's Address:* P.O. Box 2999, Hartford, CT 06104. ReliaStar Life Insurance Company of New York Variable Annuity Separate Account II [File No. 811-8965] *Summary:* Applicant, a separate account for variable annuities, seeks an order declaring that it has ceased to be an investment company. Applicant has never made and does not propose to make a public offering of its securities, and it has never had any contractowners invested in the separate account. *Filing Dates:* The application was filed on February 6, 2006, and amended on June 1, 2006. *Applicant's Address:* 1000 Woodbury Road, Woodbury, New York 11797. For the Commission, by the Division of Investment Management, pursuant to delegated authority. Nancy M. Morris, Secretary. [FR Doc. E6-10683 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54085; File No. 10-131] Order Modifying a Condition to Operation as a National Securities Exchange of the Nasdaq Stock Market LLC June 30, 2006. I. Introduction On January 13, 2006, the Securities and Exchange Commission (“Commission”) granted registration of the Nasdaq Stock Market LLC (“Nasdaq Exchange”) as a national securities exchange. 1 At the same time, the Commission conditioned the Nasdaq Exchange's operation as an exchange on the satisfaction of six specific requirements. The Commission is modifying in this Order the condition requiring the NASD to represent to the Commission that it no longer needs to control the Nasdaq Stock Market, Inc. (“Nasdaq”), the Nasdaq Exchange's parent company, through the Preferred D share because the NASD can fulfill through other means its obligations with respect to non-Nasdaq exchange listed securities under Section 15A(b)(11) of the Securities Exchange Act of 1934 (“Exchange Act”), 2 Rules 602 and 603 of Regulation NMS, 3 and the national market system plans in which it participates (the “Control Share Condition”). This condition reflected the Nasdaq Exchange's intent to begin trading at the same time Nasdaq UTP Plan Securities and CTA Plan Securities. 4 1 *See* Exchange Act Release No. 53128, 71 FR 3550 (January 23, 2006) (“Nasdaq Exchange Order”). 2 15 U.S.C. 78 *o* -3(b)(11). 3 17 CFR 242.602 and 603. 4 Transactions are reported pursuant to two national market system plans: Nasdaq-listed securities are reported to the Joint Self-Regulatory Organization Plan Governing the Collection, Consolidation and Dissemination of Quotation and Transaction Information for Nasdaq-Listed Securities Traded on Exchanges on an Unlisted Trading Privileges Basis (“Nasdaq UTP Plan Securities”); securities listed on other national securities exchanges are reported to the Consolidated Transaction Association Plan (“CTA Plan Securities”). Approximately 40 securities are dually-listed on Nasdaq and the New York Stock Exchange LLC. Transactions in these securities are reported to the CTA Plan and thus are CTA Plan Securities. The Nasdaq Exchange would now prefer to commence trading Nasdaq UTP Plan Securities and CTA Plan Securities in two separate phases. Accordingly, by letter dated March 31, 2006, the Nasdaq Exchange requested that the Commission modify the Control Share Condition to allow it to begin operating as an exchange with regard to Nasdaq UTP Plan Securities before the Control Share Condition is satisfied. 5 As discussed further below, the Commission is granting the Nasdaq Exchange's request. Until the Control Share Condition is satisfied, however, the NASD must retain control of Nasdaq through the Preferred D share, and Nasdaq must continue to perform obligations under the NASD's Plan of Allocation and Delegation of Functions by NASD to Subsidiaries (“Delegation Plan”) with respect to CTA Plan Securities. Satisfaction of the condition would continue to be a prerequisite to the Nasdaq Exchange trading CTA Plan Securities. 5 *See* letter to Nancy M. Morris, Secretary, Commission, from Edward S. Knight, Executive Vice President and General Counsel, Nasdaq, dated March 31, 2006. II. Discussion As discussed in the Nasdaq Exchange Order, 6 the NASD plans to remain a member of the Intermarket Trading System (“ITS Plan”) for the purpose of providing access to over-the-counter (“OTC”) quotes in CTA Plan Securities communicated by its members through NASD facilities and to provide its members access to exchanges' quotes in such securities. The Control Share Condition is necessary because the NASD and its members currently comply with their obligations under the ITS Plan through the NASD's Nasdaq Market Center facility. 6 *See* Nasdaq Exchange Order, *supra* note 1. In addition, with respect to CTA Plan Securities, NASD facilities owned by Nasdaq currently are the NASD's only means available to fulfill its obligations under Exchange Act Rules 602 and 603, 7 the CTA Plan, CQ Plan, and Section 15A(b)(11) of the Exchange Act. 8 Therefore, the NASD must have the means to satisfy these obligations prior to relinquishing control of Nasdaq. 7 17 CFR 242.602 and 603. 8 15 U.S.C. 78 *o* -3(b)(11). The Nasdaq Exchange represented that the technology solutions to allow the NASD to fulfill its obligations with respect to CTA Plan Securities through means that would not involve a delegation of regulatory authority to Nasdaq are not completed. 9 In addition, the Nasdaq Exchange represented that many of its prospective members have indicated that a phased-in approach to the Nasdaq Exchange's operation would be preferable. Specifically, according to the Nasdaq Exchange, these firms believe that a single-day transition would entail unnecessary costs and administrative burdens and pose transition risks that could be mitigated through a phased approach. 9 The Commission notes that the NASD operates the Alternative Display Facility (“ADF”), which currently collects quotes and trades for Nasdaq UTP Plan Securities, but not for CTA Plan Securities. The Commission believes that a phased-in implementation of the operation of the Nasdaq Exchange is consistent with the Exchange Act and may allow for a more smooth transition. Accordingly, the Commission believes that it is necessary or appropriate in the public interest, consistent with the protection of investors and consistent with the requirements of Exchange Act, and the rules and regulations thereunder applicable to Nasdaq Exchange to modify the Control Share Condition to the Nasdaq Exchange Order as follows: First, the requirement that the NASD represent that “control of Nasdaq through the Preferred D share is no longer necessary because the NASD can fulfill through other means its obligations with respect to [CTA Plan Securities] under Section 15A(b)(11) of the Exchange Act, 10 Rules 602 and 603 of Regulation NMS, 11 and the national market system plans in which the NASD participates” is modified so as to be a condition only with respect to the Nasdaq Exchange commencing to trade CTA Plan Securities. This will allow the Nasdaq Exchange to begin operations as a national securities exchange solely for Nasdaq UTP Plan securities before the Control Share Condition is satisfied. 10 15 U.S.C. 78 *o* -3(b)(11). 11 17 CFR 242.602 and 603. Second, the Control Share Condition is modified to permit the Nasdaq Exchange to commence trading Nasdaq UTP Plan Securities once Nasdaq is no longer delegated regulatory authority under the Delegation Plan with respect to such securities. The modification of the Control Share Condition described above means that the Nasdaq Exchange would commence trading in Nasdaq UTP Plan Securities while the NASD controls Nasdaq. The Commission believes, however, that it would be inappropriate for the Nasdaq Exchange to commence trading in Nasdaq UTP Plan Securities while its parent company continued to be delegated regulatory authority by the NASD with respect to the same activities. Accordingly, the Commission would have to approve an amendment to the NASD's Delegation Plan to reflect that Nasdaq would no longer be delegated regulatory authority with regard to Nasdaq UTP Securities prior to the Nasdaq Exchange commencing to trade Nasdaq UTP Plan Securities. III. Modification of Conditions to Operation The Commission notes that all of the other conditions set forth in the Nasdaq Exchange Order remain and must be satisfied before the Nasdaq Exchange can begin operations as an exchange. The Commission hereby replaces the Control Share Condition to operation of the Nasdaq Exchange as a national securities exchange as follows: B. The NASD's Ability To Fulfill Its Statutory and Regulatory Obligations

(1)With respect to the Nasdaq Exchange commencing to trade securities reported pursuant to the Nasdaq UTP Plan, the NASD's Delegation Plan is amended to eliminate Nasdaq's exercise of regulatory authority with respect to such securities.

(2)With respect only to the Nasdaq Exchange commencing to trade securities reported pursuant to the CTA Plan, the NASD must represent to the Commission that control of Nasdaq through the Preferred D share is no longer necessary because the NASD can fulfill through other means its obligations with respect to securities reported to the CTA Plan under Section 15A(b)(11) of the Exchange Act, Rules 602 and 603 of Regulation NMS, and the national market system plans in which the NASD participates. IV. Conclusion *It is ordered* that the Control Share Condition to operation for the Nasdaq Exchange is modified as described herein. By the Commission. J. Lynn Taylor, Assistant Secretary. [FR Doc. E6-10712 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54081; File No. SR-Amex-2006-60] Self-Regulatory Organizations; America Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Extension of the Pilot Period Applicable to the Listing and Trading of Options on the iShares MSCI Emerging Markets Index June 30, 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 June 20, 2006, the American Stock Exchange LLC (“Amex” or “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 by the Exchange. The Amex has filed the proposed rule change, pursuant to section 19(b)(3)(A)(iii) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 which renders the proposal effective upon filing with the Commission. 5 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 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)(6). 5 The Exchange requested the Commission to waive the five-day pre-filing notice requirement and the 30-day operative delay, as specified in Rule 19b(f)(6)(iii). 17 CFR 240.19b-4(f)(6)(iii). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to extend the pilot period applicable to Amex's the listing and trading of options on the iShares MSCI Emerging Markets Index Fund (“Fund Options”). The Amex is not proposing any textual changes to the rules of Amex. The text of the proposed rule change is available on the Amex's Web site at *http://www.amex.com* , the Office of the Secretary, Amex 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, Amex 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 Amex 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose On May 17, 2006, the Commission approved the Amex's proposal to list and trade the Fund Options. 6 SR-Amex-2006-43 was approved for a sixty-day pilot period that is due to expire on July 2, 2006 (“Pilot”). The Fund Options will continue to meet substantially all of the listing and maintenance standards in Commentary .06 to Amex Rule 915 and Commentary .07 to Amex Rule 916. For the requirements that are not met, the Amex continues to represent that sufficient mechanisms exist that would provide the Amex with adequate surveillance and regulatory information with respect to the Fund Options. Continuation of the Pilot would permit the Amex to continue to work with the Bolsa Mexicana de Valores (“Bolsa”) to develop a surveillance sharing agreement. 6 *See* Securities Exchange Act Release No. 53824 (May 17, 2006), 71 FR 30003 (May 24, 2006) (SR-Amex-2006-43). Accordingly, the Exchange proposes to extend the Pilot for an additional ninety-days, until October 1, 2006. 2. Statutory Basis The Amex believes the proposed rule change is consistent with section 6(b) of the Act 7 in general, and furthers the objectives of section 6(b)(5) of the Act, 8 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 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; and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers, or to regulate by virtue of any authority conferred by the Act matters not related to the purpose of the Act or the administration of the Amex. 7 15 U.S.C. 78f(b). 8 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition Amex does not believe that the proposed rule change will impose any 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 No written comments were solicited or received with respect to the proposed rule change. 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) of the Act 9 and Rule 19b-4(f)(6) 10 thereunder because the proposed rule change:

(i)Does not significantly affect the protection of investors or the public interest;

(ii)does not impose any significant burden on competition; and

(iii)does not become operative for 30 days from the date of the filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest pursuant to section 19(b)(3)(A)(iii) of the Act 11 and Rule 19b-4(f)(6) thereunder. 12 9 15 U.S.C. 78s(b)(3)(A). 10 17 CFR 240.19b-4(f)(6). 11 15 U.S.C. 78s(b)(3)(A)(iii). 12 17 CFR 240.19b-4(f)(6). Amex has requested that the Commission waive both the five-day pre-filing requirement and the 30-day delayed operative delay. 13 The Commission is exercising its authority to waive the five-day pre-filing notice requirement and believes that the waiver of the 30-day operative delay is consistent with the protection of investors and the public interest. Waiver of the five-day pre-filing and 30-day operative periods will extend the Pilot, which would otherwise expire on July 1, 2006, and allow the Amex to continue in its efforts to obtain a surveillance agreement with Bolsa. Accordingly, the Commission designates the proposal to be effective and operative upon filing with the Commission. 14 13 17 CFR 240.19b-4(f)(6)(iii). 14 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). At any time within sixty

(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. 15 15 *See* Section 19(b)(3)(C) of the Act, 15 U.S.C. 78s(b)(3)(C). 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 *rule-comments@sec.gov* . Please include File Number SR-Amex-2006-60 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-Amex-2006-60. 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 Section, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of the Amex. 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-Amex-2006-60 and should be submitted on or before July 31, 2006. 16 17 CFR 200.30-3(a)(12). For the Commission by the Division of Market Regulation, pursuant to delegated authority. 16 Nancy M. Morris, Secretary. [FR Doc. E6-10684 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54082; File No. SR-BSE-2006-29] Self-Regulatory Organizations; Boston Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto to Extend the Effective Date of a Previous Rule Change Relating to Information Contained in a Directed Order on the Boston Options Exchange June 30, 2006. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on June 20, 2006, the Boston Stock Exchange, Inc. (“BSE” or “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 by the BSE. The BSE 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 the proposed rule change effective upon filing with the Commission. On June 29, 2006, the BSE filed Amendment No. 1 to the proposed rule change. 5 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 1 5 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). 5 In Amendment No. 1, BSE submitted rule text that indicates that the proposed rule change will expire on September 30, 2006. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change On March 17, 2006, the Exchange filed a proposed rule change to amend its rules governing its Directed Order process on Boston Stock Exchange, Inc. (“BOX”) pursuant to section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder, which rendered the proposal immediately effective upon filing with the Commission. 6 The rules were amended to clearly state that the BOX Trading Host identifies to an Executing Participant (“EP”) the identity of the firm entering a Directed Order. The amended rule was to be effective until June 30, 2006, while the Commission considered a corresponding Exchange proposal, SR-BSE-2005-52, 7 to amend the BOX rules on a permanent basis to permit EPs to choose the firms from whom they will accept Directed Orders, while providing complete anonymity of the firm entering a Directed Order. 8 6 *See* Securities Exchange Act Release No. 53516 (March 20, 2006), 71 FR 15232 (March 27, 2006) (SR-BSE-2006-14). At the Exchange's request, the Commission edited language in this filing to clarify that the Commission did not approve SR-BSE-2006-14, but that SR-BSE-2006-14 became immediately effective upon filing with the Commission pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder. Telephone conference between Jan Woo, Attorney, Division of Market Regulation, Commission, and Brian Donnelly, Assistant Vice President of Regulation and Compliance, BSE, on June 27, 2006 (“Telephone conference”). 7 *See* Securities Exchange Act Release No. 53357 (February 23, 2006), 71 FR 10730 (March 2, 2006) (Notice of filing of Amendments No. 2, 3, and 4 to proposed rule change to modify the information contained in a Directed Order on the BOX). 8 In the event that the issue of anonymity in the Directed Order process is not resolved by September 30, 2006, the Exchange intends to submit another filing under Rule 19b-4(f)(6) under the Act extending this rule and system process. The Exchange now proposes to extend the effective date of the amended rule governing the anonymity of its Directed Order process on the BOX from June 30, 2006 to September 30, 2006 while the Commission continues to consider SR-BSE-2005-52 which would amend the BOX rules on a permanent basis to permit EPs to choose the firms from whom they will accept Directed Orders, while providing complete anonymity of the firm entering a Directed Order. In the event the Commission reaches a decision with respect to SR-BSE-2005-52 to amend the BOX rules before September 30, 2006, the amended rule governing the Exchange's Directed Order process on the BOX will cease to be effective at the time of that decision. This rule filing proposes to extend the effective date of the amended rule governing the Exchange's Directed Order process on the BOX from June 30, 2006 to September 30, 2006. 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 BSE 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 BSE 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 March 17, 2006 the BSE filed SR-BSE-2006-14, a proposed rule change seeking to amend the BOX rules to clearly state that the BOX Trading Host identifies to an EP the identity of the firm entering a Directed Order. That proposed rule change became immediately effective upon filing with the Commission pursuant to Rule 19b-4(f)(6) under the Act. 9 The rule change was to be effective until June 30, 2006, while the Commission considered a corresponding Exchange proposal, SR-BSE-2006-52, to amend the BOX rules on a permanent basis to permit EPs to choose the firms from whom they will accept Directed Orders while providing complete anonymity of the firm entering a Directed Order. This proposed rule filing seeks to extend the date of effectiveness of the amended Directed Order rule from June 30, 2006 to September 30, 2006, while the Commission considers SR-BSE-2005-52 to amend the BOX rules on a permanent basis to permit EPs to choose the firms from whom they will accept Directed Orders while providing complete anonymity of the firm entering a Directed Order. 9 *See* footnote 5 *supra.* Telephone conference. 2. Statutory Basis The amended rule is designed to clarify the information contained in a Directed Order. This proposed rule filing seeks to extend the amended rule's effectiveness from June 30, 2006 to September 30, 2006. This extension will afford the Commission the necessary time to consider SR-BSE-2005-52 which would amend the BOX rules on a permanent basis to permit EPs to choose the firms from whom they will accept Directed Orders while providing complete anonymity of the firm entering a Directed Order. Accordingly, the Exchange believes that the proposal is consistent with the requirements of section 6(b) of the Act, 10 in general, and section 6(b)(5) of the Act, 11 in particular, in that it is designed to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transaction in securities, to remove impediments to and perfect the mechanism for a free and open market and a national market system, and, in general, to protect investors and the public interest. 10 U.S.C. 78f(b). 11 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any 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 has neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change, as amended:

(1)Does not significantly affect the protection of investors or the public interest;

(2)does not impose any significant burden on competition; and

(3)by its terms does not become operative for 30 days after the date of this filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to section 19(b)(3)(A) 12 of the Act and Rule 19b-4(f)(6) thereunder. 13 12 15 U.S.C. 78s(b)(3)(A). 13 17 CFR 240.19b-4(f)(6). A proposed rule change filed under Rule 19b-4(f)(6) 14 normally may not become operative prior to 30 days after the date of filing. However, Rule 19b-4(f)(6)(iii) 15 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The BSE requests that the Commission waive the 5-day pre-filing notice requirement and the 30-day operative delay, as specified in Rule 19b-4(f)(6)(iii), 16 which would make the rule change effective and operative upon filing. The Commission believes that waiving the 5-day pre-filing notice and the 30-day operative delay is consistent with the protection of investors and the public interest because such waiver would continue to conform the BOX rules with BOX's current practice and clarify that Directed Orders on BOX are not anonymous. 17 Accordingly, the Commission designates that the proposed rule change effective and operative upon filing with the Commission. 14 17 CFR 240.19b-4(f)(6). 15 17 CFR 240.19b-4(f)(6)(iii). 16 17 CFR 240.19b-4(f)(6)(iii). 17 For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. *See* 15 U.S.C. 78c(f). At any time within 60 days of the filing of such 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. 18 18 The effective date of the original proposed rule is June 20, 2006. The effective date of Amendment No. 1 is June 29, 2006. For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on June 29, 2006, the date on which the BSE submitted Amendment No. 1. *See* 15 U.S.C. 78s(b)(3)(C). IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the amended 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 *rule-comments@sec.gov* . Please include File No. SR-BSE-2006-29 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-BSE-2006-29. 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. Copies of such filing also will be available for inspection and copying at the principal office of the BSE. 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-BSE-2006-29 and should be submitted on or before July 31, 2006. 19 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 19 Nancy M. Morris, Secretary. [FR Doc. E6-10721 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54090; File No. SR-CHX-2006-22] Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Notice of Filing of Proposed Rule Change and Amendment No. 1 Thereto To Amend the CHX Holdings, Inc. Certificate of Incorporation June 30, 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 June 22, 2006, the Chicago Stock Exchange, Inc. (“CHX” 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 CHX. On June 30, 2006, the Exchange filed Amendment No. 1 to the proposed rule change. 3 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 In Amendment No. 1, the Exchange made technical changes to correct the marking of the proposed rule text. I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The CHX is proposing, on behalf of its parent company, CHX Holdings, Inc. (“CHX Holdings”), to amend the CHX Holdings Certificate of Incorporation (the “charter”) to:

(1)Make a minor change in the ownership limitations applicable to both CHX participants and other persons or entities; and

(2)increase the number of shares of common stock which CHX Holdings is authorized to issue. The text of the proposed rule change appears below. Additions are *italicized* ; deletions are [bracketed]. CERTIFICATE OF INCORPORATION OF CHX HOLDINGS, INC. Authorized Stock FOURTH: The total number of shares of stock which the Corporation shall have authority to issue is *900,000* [750,000] shares of common stock having a par value of $.01 per share and 25,000 shares of preferred stock having a par value of $.01 per share. The Board of Directors is expressly authorized to fix by resolution any of the designations and the powers, preferences and rights and the qualifications, limitations or restrictions which are permitted by Section 151 of the General Corporation Law of Delaware in respect of any such class or classes of preferred stock or any series of any class or classes of preferred stock of the Corporation. Limitations on Transfer, Ownership and Voting FIFTH:

(a)No change to text.

(b)Limitations.

(i)No change to text.

(ii)For so long as the Corporation shall control, directly or indirectly, the Chicago Stock Exchange, Inc., except as provided in clause

(iii)below:

(A)no Person (as defined above), either alone or together with its Related Persons (as defined above), may own, directly or indirectly, of record or beneficially shares *of stock of the Corporation representing in the aggregate* [constituting] more than forty percent (40%) of [any class of capital stock (whether common stock or preferred stock) of the Corporation] *the then outstanding votes entitled to be cast on any matter;*

(B)no Person, either alone or together with its Related Persons, who holds a trading permit of the Chicago Stock Exchange, Inc., may own, directly or indirectly, of record or beneficially shares *of stock of the Corporation representing in the aggregate* [constituting] more than twenty percent (20%) of [any class of capital stock of the Corporation] *the then outstanding votes entitled to be cast on any matter;* and

(C)No change to text.

(iii)No change to text.

(A)No change to text.

(B)No change to text.

(iv)No change to text.

(v)Notwithstanding clauses (iii)(A) and (iii)(B) above, any Person (and its Related Persons owning any capital stock of the Corporation) which proposes to own, directly or indirectly, of record or beneficially shares of [the capital] stock [(whether common stock or preferred stock)] of the Corporation *representing in the aggregate* [constituting] more than forty percent (40%) of [the outstanding shares of any class of capital stock of the Corporation] *the then outstanding votes entitled to be cast on any matter,* or to exercise voting rights, or grant any proxies or consents with respect to shares of [the capital] stock [(whether common stock or preferred stock)] of the Corporation *representing in the aggregate* [constituting] more than twenty percent (20%) of [the outstanding shares of any class of capital stock of the Corporation] *the then outstanding votes entitled to be cast on any matter,* shall have delivered to the Board of Directors of the Corporation a notice in writing, not less than forty-five

(45)days (or any shorter period to which said Board shall expressly consent) before the proposed ownership of such shares, or the proposed exercise of said voting rights or the granting of said proxies or consents, of its intention to do so.

(c)Required Notices.

(i)Any Person that, either alone or together with its Related Persons, owns, directly or indirectly (whether by acquisition or by a change in the number of shares outstanding), of record or beneficially *shares of stock of the Corporation that represent* five percent (5%) or more of the then *outstanding votes entitled to be cast on any matter* [outstanding shares of capital stock of the Corporation] (excluding shares of any class of preferred stock that does not have the right by its terms to vote generally in the election of members of the Board of Directors of the Corporation) shall, immediately upon [owning] *becoming the owner of such amount of stock* [five percent (5%) or more of the then outstanding shares of such stock], give the Board of Directors written notice of such ownership, which notice shall state:

(A)Such Person's full legal name;

(B)such Person's title or status and the date on which such title or status was acquired;

(C)such Person's approximate ownership interest of the Corporation; and

(D)whether such Person has the power, directly or indirectly, to direct the management or policies of the Corporation, whether through ownership of securities, by contract or otherwise.

(ii)Each Person required to provide written notice pursuant to subparagraph (c)(i) of this Article Fifth shall update such notice promptly after any change in the contents of that notice; provided that no such updated notice shall be required to be provided to the Board of Directors in the event of an increase or decrease in the ownership percentage so reported of *shares of stock of the Corporation that represent* less than one percent (1%) of the *then outstanding votes entitled to be cast on any matter* [then outstanding shares of any class of capital stock] (such increase or decrease to be measured cumulatively from the amount shown on the last such report), unless any increase or decrease of less than one percent (1%) results in such Person owning *shares of stock of the Corporation that represent* more than twenty percent (20%) or more than forty percent (40%) of the *then outstanding votes entitled to be cast on any matter* [shares of any class of capital stock then outstanding] (at a time when such Person previously owned less than such percentages) or such Person owning *shares of stock of the Corporation that represent* less than twenty percent (20%) or less than forty percent (40%) of the *then outstanding votes entitled to be cast on any matter* [shares of any class of capital stock then outstanding] (at a time when such Person previously owned more than such percentages). 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 CHX 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 CHX 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 As a result of its demutualization in February 2005, the Exchange became the wholly-owned subsidiary of CHX Holdings, a Delaware corporation. 4 The Exchange's demutualization was driven, in part, by a desire to generate opportunities to enter into strategic alliances by offering stock to interested entities. On June 21, 2006, CHX Holdings announced that it had agreed to the terms of strategic transactions with four firms that will result in an investment in CHX Holdings, in exchange for minority equity stakes in the company. In connection with these transactions, CHX Holdings has agreed to propose amendments to its charter to:

(1)Make a minor change in the ownership limitations applicable to both CHX participants and other persons or entities; and

(2)increase the number of shares of common stock which CHX Holdings is authorized to issue. 4 *See* Securities Exchange Act Release No. 51149 (February 8, 2005), 70 FR 7531 (February 14, 2005) (order approving File No. SR-CHX-2004-26) (“Demutualization Approval Order”). The CHX Holdings charter currently prohibits any person, either alone or together with its related persons, from owning, directly or indirectly, shares constituting more than 40% of any class of CHX Holdings capital stock. 5 A related provision bars any person that holds a CHX trading permit, either alone or together with its related persons, from owning, directly or indirectly, shares constituting more than 20% of any class of CHX Holdings capital stock. 6 Other provisions place limitations on the percentage of shares that can be voted. 7 The ownership and voting limitations that apply to holders of CHX trading permits were designed to ensure that no participant in the Exchange (or its parent company, CHX Holdings) has such a large ownership in CHX Holdings that it casts doubt on the Exchange's ability to fairly and objectively exercise its self-regulatory responsibilities. 8 5 *See* Article Fifth, Section (b)(ii)(A) of the CHX Holdings charter. This article defines a “person” as “an individual, partnership (general or limited), joint stock company, corporation, limited liability company, trust or unincorporated organization or any governmental entity or agency or political subdivision thereof.” *See* Article Fifth, Section (a)(i). A “related person” is defined as “(A) with respect to any [p]erson, all ‘affiliates’ and ‘associates’ of such [p]erson (as such terms are defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended);

(B)with respect to any [p]erson that holds a permit issued by the Chicago Stock Exchange, Inc. to trade securities on the Chicago Stock Exchange (a “Participant”), any broker or dealer with which a Participant is associated; and

(C)any two or more [p]ersons that have any agreement, arrangement or understanding (whether or not in writing) to act together for the purpose of acquiring, voting, holding or disposing of shares of the capital stock of the Corporation.” *See* Article Fifth, Section (a)(ii). 6 *See* Article Fifth, Section (b)(ii)(B). 7 *See* Article Fifth, Section (b)(ii)(C). 8 The Commission consistently has noted this concern as it approved substantially similar ownership and voting restrictions in connection with the proposed demutualizations or restructurings of national securities exchanges. *See* Demutualization Approval Order, *supra* note 4, 70 FR at 7538; Securities Exchange Act Release No. 49718 (May 17, 2004), 69 FR 29611 (May 24, 2004) (order approving SR-PCX-2004-08); Securities Exchange Act Release No. 49098 (January 16, 2004), 69 FR 3974 (January 27, 2004) (order approving SR-Phlx-2003-73). CHX Holdings now seeks to make a minor change in these ownership provisions—keeping the same 20% and 40% limitations—but referring to shares of stock of CHX Holdings representing in the aggregate more than 20% or 40% of “the then outstanding votes entitled to be cast on any matter,” rather than to the shares of each class of stock that a person might own. CHX Holdings believes that this revised definition would more precisely address the reason for establishing the limitations in the first place—to limit the voting power that can be wielded by a stockholder that is also an Exchange participant. The language proposed by CHX Holdings is identical to text included in the recently-approved Amended and Restated Certificate of Incorporation of NYSE Group, Inc. 9 9 *See* Article V, Section 2 of the Amended and Restated Certificate of Incorporation of NYSE Group, Inc., approved by the Commission in Securities Exchange Act Release No. 53382 (February 27, 2006), 71 FR 11251 (March 6, 2006) (order approving NYSE-2005-77). In addition to the above-noted proposed wording change to the ownership limitations set out in the CHX Holdings charter, CHX Holdings also seeks approval to increase the number of shares of common stock that can be issued by the company from 750,000 to 900,000. CHX Holdings proposes this increase in the number of authorized shares to, among other things, permit the company to seek one or more additional investors and to have shares available if the company later seeks to establish an equity compensation plan for directors, officers or employees. All of these proposed changes to the CHX Holdings charter must be presented to the CHX Holdings stockholders for approval before they are effective. CHX Holdings plans to do so at the annual stockholder meeting on July 19, 2006. 10 Stockholders will be provided with proxy materials prior to the meeting that will describe these proposals and other issues in more detail. 11 10 If CHX Holdings stockholders approve the proposed change, the Exchange will file with the Commission an amendment to this proposal to reflect that approval. 11 CHX Holdings has halted trading in its common stock until the third business day following distribution of these materials. 2. Statutory Basis The CHX believes the proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b). 12 The CHX believes the proposal is consistent with Section 6(b)(5) of the Act 13 in that it is designed to promote just and equitable principles of trade, to remove impediments, and to perfect the mechanism of, a free and open market and a national market system, and, in general, to protect investors and the public interest by permitting CHX Holdings to make minor changes to the ownership limitations set out in its charter that fully address the reasons for establishing those limitations in the first place and that are identical to the language used by at least one other national securities exchange in doing so. 12 15 U.S.C. 78(f)(b). 13 15 U.S.C. 78f(b)(5). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition. C. Self-Regulatory Organization'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 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

(1)both Linkage P and Linkage P/A Orders shall remain subject to a comparison fee of $0.03 per contract, and

(2)Satisfaction Orders are excluded from these fees. 2. Statutory Basis The Exchange states that the basis for this proposed rule change is the requirement under section 6(b)(4) of the Act, 7 which requires that an exchange have an equitable allocation of reasonable dues, fees and other charges among its members and other persons using its facilities. 7 15 U.S.C. 78f(b)(4). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange believes that the proposed rule change would not impose any 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 has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule 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, 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 No. SR-ISE-2006-30 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-ISE-2006-30. 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. Copies of such filing also will be available for inspection and copying at the principal office of the ISE. 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-ISE-2006-30 and should be submitted on or before July 31, 2006. 8 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 8 Nancy M. Morris, Secretary. [FR Doc. E6-10682 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54087; File No. SR-ISE-2005-60] Self-Regulatory Organizations; International Securities Exchange, Inc.; Order Approving Proposed Rule Change and Amendment Nos. 1 and 2 Thereto and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 3 Thereto Relating to the Criteria for Securities That Underlie Options Traded on the Exchange June 30, 2006. I. Introduction On December 14, 2005, the International Securities Exchange, Inc. (“Exchange” or “ISE”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”), 1 and Rule 19b-4 thereunder, 2 a proposed rule change to enable the listing and trading on the Exchange of options on shares or other securities (“Fund Shares”) that hold specified non-U.S. currency. The ISE filed Amendment No. 1 to the proposed rule change on May 5, 2006. 3 The ISE filed Amendment No. 2 to the proposed rule change on May 9, 2006. 4 The proposed rule change, as amended, was published for comment in the **Federal Register** on May 16, 2006. 5 The Commission received no comments on the proposal. On June 28, 2006, the Exchange filed Amendment No. 3 to the proposed rule change. 6 This order approves the proposed rule change, as amended, grants accelerated approval to Amendment No. 3 to the proposed rule change, and solicits comments from interested persons on Amendment No. 3. 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b-4. 3 Amendment No. 1 replaced the original filing in its entirety. 4 Amendment No. 2 replaced the text of proposed ISE Rules 408(a) and 807(a) in their entirety. 5 *See* Securities Exchange Act Release No. 53783 (May 10, 2006), 71 FR 28394 (“Notice”). 6 In Amendment No. 3, which supplemented the proposal as noticed, the Exchange amended ISE Rule 503(h)(3) to clarify that the Exchange will consider the suspension of opening transactions with respect to a Fund Share if, *inter alia,* the value of the non-U.S. currency on which the Fund Shares are based is no longer calculated or available. II. Description of the Proposed Rule Change The Exchange proposes to amend ISE Rules 408(a), 502(h), 807(a), and 1400 to enable the initial and continued listing and trading on the Exchange of options on Fund Shares that represent interests in a trust that hold a specified non-U.S. currency. In addition, the Exchange proposes to amend ISE Rule 503(h) to clarify the effect, with respect to options trading on the Exchange, of any Fund Shares being delisted from trading or halted from trading on their primary market. Specifically, the Exchange is proposing to amend ISE Rule 502(h) (Criteria for Underlying Securities) to broaden the definition of Fund Shares to include shares or other securities that represent interests in registered investment companies or unit investment trusts or similar entities that hold a specified non-U.S. currency. The Exchange is also proposing to make other conforming changes to the text of ISE Rule 502(h) to reflect the proposed broadened definition of Fund Shares. In addition, the Exchange is proposing to require, in ISE Rule 502(h)(4), that before listing and trading options on Fund Shares based on a non-U.S. currency, the Exchange must have entered into an appropriate comprehensive surveillance sharing agreement with the applicable marketplace or marketplaces with last sale reporting that represent(s) the highest volume in derivatives (options or futures) on the specified non-U.S. currency. This provision means that the options exchange listing options on the Fund Shares must utilize the same comprehensive surveillance sharing arrangements utilized by the equity markets that list and trade the Fund Shares. The Exchange also proposes to amend ISE Rule 408(a) to require a member to establish, maintain, and enforce written policies and procedures to prevent the misuse of any material nonpublic information it might have or receive in a related security, option, or derivative security or in the applicable non-U.S. currency, non-U.S. currency options, futures or options on futures on such currency, or any other derivatives based on such currency. In addition, the Exchange proposes to amend ISE Rules 807(a) and 1400 to require that market makers handling Fund Shares provide the Exchange with all necessary information relating to their trading in the applicable non-U.S. currency, non-U.S. currency options, futures or options on futures on such currency, or any other derivatives based on such currency. Finally, the Exchange proposes to amend ISE Rule 503(h) regarding withdrawal of approval of the underlying securities to specify that Fund Shares approved for options trading under ISE Rule 502(h) will not be deemed to meet the requirements for continued approval, and ISE will not open any additional series of options contracts thereof, if the Fund Shares are delisted from trading or halted from trading on their primary market. In Amendment No. 3, the Exchange is also proposing to amend ISE Rule 503(h)(3) to clarify the continued listing criteria applicable to Fund Shares that hold specified non-U.S. currency. 7 7 *See supra* note 6. III. Discussion After careful review, the Commission finds that the proposed rule change, as amended, is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange. 8 In particular, the Commission finds that the proposed rule change, as amended, is consistent with Section 6(b)(5) of the Act, 9 which requires, among other things, that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, 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. 8 In approving this proposed rule change, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 9 15 U.S.C. 78f(b)(5). Currently, the Exchange can list options on Fund Shares that represent interests in registered investment companies, unit investment trusts, or other similar entities that hold portfolios of securities or are otherwise based on or represent investments in broad-based indexes or portfolios of securities. 10 The Exchange's proposal would allow it to list and trade options on Fund Shares whose investment assets consist of a specified non-U.S. currency deposited with a trust. For example, the Exchange's proposed rule change will permit the Exchange to list options on the Euro Currency Trust (“Trust”), which issues shares (“Euro Shares”) that are listed and traded on the New York Stock Exchange (“NYSE”) under the symbol “FXE,” and may also trade in other markets. 11 Fund Shares would continue to need to satisfy the listing standards in ISE Rule 502(h). Specifically, the Fund Shares must be traded on a national securities exchange or through the facilities of a national securities association and, as the Exchange has proposed, must be an “NMS stock” as defined under Rule 600 of Regulation NMS. 12 The Fund Shares must also either:

(1)Meet the criteria and guidelines under ISE Rules 502(a) and 502(b) (Criteria for Underlying Securities); or

(2)be available for creation or redemption each business day from and through the issuer in cash or in-kind at a price related to net asset value, and the issuer is obligated to issue Fund Shares in a specified aggregate number even if some or all of the investments required to be deposited have not been received by the issuer, subject to the condition that the person obligated to deposit the investments has undertaken to deliver the investment assets as soon as possible, and such undertaking is secured by the delivery and maintenance of collateral consisting of cash or cash equivalents satisfactory to the issuer, as described in the Fund Share's prospectus. The Commission notes that the Exchange has represented that the expansion of the types of investments that may be held by Fund Shares under ISE Rule 502(h) will not have any effect on the rules pertaining to position and exercise limits 13 or margin. 14 10 *Se* e ISE Rule 502(h). 11 *See* Securities Exchange Act Release No. 52843 (November 28, 2005), 70 FR 72486 (December 5, 2005) (SR-NYSE-2005-65). 12 In light of the implementation of certain aspects of Regulation NMS, the Exchange also proposes to amend ISE Rule 502(h) to reflect that qualifying Fund Shares must be defined as National Market System stocks as defined under Rule 600 of Regulation NMS. 13 *See* Notice, *supra* note 5, at text accompanying note 13. *See also* ISE Rules 412 and 414. 14 *See* Notice, *supra* note 5, at text accompanying note 14. *See also* ISE Rule 1202. To accommodate the listing and trading of options on Fund Shares investing primarily in non-U.S. currency, the Exchange proposes to amend ISE Rule 408(a) to require that, in connection with trading in the applicable non-U.S. currency, non-U.S. currency options, futures or options on futures on such currency, or any other derivatives based on such currency, an ISE member must establish policies and procedures prohibiting the use of any material nonpublic information it might have or receive from any person associated with it in the applicable non-U.S. currency, non-U.S. currency options, futures or options on futures on such currency, or any other derivatives based on such currency. Further, the Exchange proposes to amend ISE Rules 807(a) and 1400 to require that market makers handling Fund Shares provide the Exchange with all necessary information relating to their trading in the applicable non-U.S. currency, non-U.S. currency options, futures or options on futures on such currency, or any other derivatives based on such currency. The Commission believes that these requirements minimize the potential for manipulating the underlying currency held by the Fund Shares. Finally, under the proposed change to ISE Rule 503(h), Fund Shares would not be deemed to meet the requirements for continued approval, and the Exchange would not open for trading any additional series of option contracts of the class covering such Fund Shares, if the Fund Shares are delisted from trading or, pursuant to the proposed rule change, are halted from trading on their primary market. The Commission believes that the Exchange's proposal to expand ISE Rule 503(h) to address the effect of a trading halt in the Fund Shares on their primary market is consistent with the protection of investors and the public interest. The Commission also notes that the Exchange has represented that it has an adequate surveillance program in place for options on Fund Shares, as defined by the Exchange's proposal, and it intends to apply those same program procedures that it applies to options on Fund Shares currently traded on the Exchange. In addition, the Exchange is able to obtain trading information via the Intermarket Surveillance Group (“ISG”) from other exchanges who are members or affiliates of the ISG. With respect to the Euro Shares, the Commission notes that the Exchange can obtain such information from the Philadelphia Stock Exchange (“Phlx”) in connection with euro options trading on the Phlx and from the Chicago Mercantile Exchange (“CME”) and the London International Financial Futures Exchange (“LIFFE”) in connection with euro futures trading on those exchanges. 15 15 Phlx is a member of ISG. CME and LIFFE are affiliate members of ISG. The Commission finds good cause for approving Amendment No. 3 to the proposed rule change prior to the thirtieth day after the date of the publication of notice thereof in the **Federal Register** pursuant to Section 19(b)(2) of the Act. 16 The Commission notes that Amendment No. 3 clarifies the operation of the continued listing criteria in ISE Rule 503(h)(3) by providing that the Exchange will consider the suspension of opening transactions for Fund Shares if the value of the non-U.S. currency on which the Fund Shares are based is no longer calculated or available. 17 The Commission notes that the Notice's discussion of the Euro Shares addressed this point, 18 and that Amendment No. 3 makes a conforming change to the text of ISE Rule 503(h)(3) to address the Exchange's proposed broadened definition of Fund Shares to include Fund Shares that represent interests in a trust that hold a specified non-U.S. currency. The Commission therefore believes that it is appropriate to accelerate approval of Amendment No. 3 so that the proposed rule change, as amended, may be implemented without delay. 16 15 U.S.C. 78s(b)(2). Pursuant to Section 19(b)(2) of the Act, the Commission may not approve any proposed rule change, or amendment thereto, prior to the thirtieth day after the date of publication of the notice thereof, unless the Commission finds good cause for so doing. 17 Under the existing continued listing criteria in ISE Rule 503(h), Fund Shares may be delisted as follows:

(1)Following the initial twelve-month period beginning upon the commencement of trading of the Fund Shares, there are fewer than 50 record and/or beneficial holders of the Fund Shares for 30 or more consecutive trading days;

(2)the value of the index or portfolio of securities is no longer calculated or available; or

(3)such other event occurs or condition exists that in the opinion of the Exchange makes further dealing on the Exchange inadvisable. 18 *See* Notice, *supra* note 5, at 28397 (noting that Euro Shares may be delisted if the value of the euro is no longer calculated or available). IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether Amendment No. 3 to 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 *rule-comments@sec.gov.* Please include File Number SR-ISE-2005-60 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-ISE-2005-60. 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. 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 Number SR-ISE-2005-60 and should be submitted on or before July 31, 2006. V. Conclusion For the foregoing reasons, the Commission finds that the proposed rule change, as amended, is consistent with the Act and rules and regulations thereunder applicable to the national securities exchange. *It is therefore ordered,* pursuant to Section 19(b)(2) of the Act, 19 that the proposed rule change (SR-ISE-2005-60), as amended, is approved, and Amendment No. 3 is approved on an accelerated basis. 19 15 U.S.C. 78s(b)(2). 20 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 20 Nancy M. Morris, Secretary. [FR Doc. E6-10717 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Release No. 34-54083; File No. SR-ISE-2006-35] Self-Regulatory Organizations; International Securities Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Directed Orders System Change June 30, 2006. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”), 1 and Rule 19b-4 thereunder, 2 notice is hereby given that on June 30, 2006, the International Securities Exchange, Inc. (“ISE” 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 ISE. The proposed rule change has been filed by the ISE as effecting a change in an existing order-entry or trading system pursuant to section 19(b)(3)(A) of the Act, 3 and Rule 19b-4(f)(5) thereunder, 4 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 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)(5). I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The ISE is proposing to extend the pilot period for the system change that identifies to a Directed Market Maker (“DMM”) the identity of the firm entering a Directed Order until September 30, 2006. 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 ISE 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 ISE 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 January 5, 2006, the ISE initiated a system change to identify to a DMM the identity of the firm entering a Directed Order. The ISE filed this system change on a pilot basis under section 19(b)(3)(A) of the Act and Rule 19b-4(f)(5) thereunder 5 so that it would be effective while the Commission considered a separate proposed rule change filed under section 19(b)(2) of the Act to amend the ISE's rules to reflect the system change on a permanent basis (the “Permanent Rule Change”). 6 The pilot currently expires on June 30, 2006, but the Commission has not yet taken action with respect to the Permanent Rule Change. Accordingly, the Exchange proposes to extend the pilot until September 30, 2006, so that the system change will remain in effect while the Commission continues to evaluate the Permanent Rule Change. 7 5 Securities Exchange Act Release No. 53104 (Jan. 11, 2006), 71 FR 3142 (Jan. 19, 2006) (Notice of Filing and Immediate Effectiveness for SR-ISE-2006-02). 6 Securities Exchange Act Release No. 53103 (Jun. 11, 2006), 71 FR 3144 (Jan. 19, 2006) (Notice of Filing for SR-ISE-2006-01). 7 The ISE anticipated that extension of the pilot might be necessary and included this in the filing for the initial pilot. *See supra* note 3, at footnote 5. 2. Statutory Basis The Exchange believes that the basis under the Act is found in section 6(b)(5), in that the propose rule change is designed to promote just and equitable principles of trade, remove impediments to and perfect the mechanisms of a free and open market and a national market system and, in general, to protect investors and the public interest. Extension of the pilot program will allow the Exchange to remain competitive with the Boston Options Exchange (“BOX”), which operates a directed orders program that discloses the identity of an entering firm to the BOX directed market maker. 8 8 *See* Securities Exchange Act Release Nos. 53015 (Dec. 22, 2005), 70 FR 77207 (Dec. 29, 2005); 53357 (Feb. 23, 2006); and 71 FR 10730 (March 2, 2006) (SR-BSE-2005-52). B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange believes that the proposed rule change does not impose any 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 has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change effects a change in an existing order entry or trading system that

(i)does not significantly affect the protection of investors or the public interest;

(ii)does not impose any significant burden on competition; and

(iii)does not have the effect of limiting access to or availability of the system, it has become effective pursuant to section 19(b)(3)(A)(iii) of the Act 9 and Rule 19b-4(f)(5) thereunder. 10 9 15 U.S.C. 78s(b)(3)(A)(iii). 10 17 CFR 19b-4(f)(5). At any time within 60 days of the filing of such 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 *rule-comments@sec.gov.* Please include File No. SR-ISE-2006-35 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-ISE-2006-35. 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. Copies of such filing also will be available for inspection and copying at the principal office of the ISE. 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-ISE-2006-35 and should be submitted on or before July 31, 2006. 11 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 11 Nancy M. Morris, Secretary. [FR Doc. E6-10719 Filed 7-7-06; 8:45 am] BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION (Release No. 34-54071; File No. SR-NASD-2006-068) Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendments No. 1, 2, 3 and 4 Thereto To Create the Nasdaq Global Select Market and Rename the Nasdaq National Market June 29, 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 May 30, 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 and II below, which Items have been prepared by Nasdaq. Nasdaq has filed this proposal pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b-4(f)(6) thereunder, 4 which renders the proposal effective upon filing with the Commission. On June 9, 2006, Nasdaq filed Amendment No. 1 to the proposed rule change. 5 Nasdaq filed Amendment No. 2 on June 15, 2006, Amendment No. 3 on June 27, 2006, and Amendment No. 4 on June 29, 2006. 6 The Commission is publishing this notice to solicit comments on the proposed rule change, as amended, from interested persons. 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). 5 Amendment No. 1 replaced the original filing in its entirety. 6 In Amendments No. 2, 3 and 4, Nasdaq made certain technical corrections and clarifications to its rule text. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change Nasdaq proposes to rename the Nasdaq National Market as the Nasdaq Global Market and to create the Nasdaq Global Select Market, a new tier within the Nasdaq Global Market with higher initial listing standards. Nasdaq would implement the proposed rule change on July 1, 2006. Nasdaq previously filed substantially identical changes to the rules of the NASDAQ Stock Market LLC (“Nasdaq LLC”). 7 This rule filing incorporates these changes into the rules of the NASD because Nasdaq LLC will not commence operations as a national securities exchange prior to the planned July 1, 2006, launch date for the Nasdaq Global Select Market. 8 The text of the proposed rule change is available on Nasdaq's Web site ( *http://www.nasdaq.com* ), at Nasdaq's principal office, and at the Commission's Public Reference Room. The text of the proposed rule change is included below. Proposed new language is *italicized* ; deletions are [bracketed]. 7 *See* Securities Exchange Act Release No. 53799 (May 12, 2006), 71 FR 29195 (May 19, 2006) (SR-NASDAQ-2006-007). 8 *See* Securities Exchange Act Release No. 53128 (January 13, 2006), 71 FR 3550 (January 23, 2006). IM-2310-2. Fair Dealing With Customers (a)-(d) No change.

(e)Fair Dealing With Customers with Regard to Derivative Products or New Financial Products. (1)-(2) No change.

(3)Hybrid Securities and Selected Equity-Linked Debt Securities (“SEEDS”) Designated as Nasdaq [National] *Global* Market Securities Pursuant to the Rule 4400 Series. No change. 2710. Corporate Financing Rule—Underwriting Terms and Arrangements

(a)No change.

(b)(1)-(6) No change.

(7)Offerings Exempt from Filing. Notwithstanding the provisions of subparagraph

(1)above, documents and information related to the following public offerings need not be filed with NASD for review, unless subject to the provisions of Rule 2720. However, it shall be deemed a violation of this Rule or Rule 2810, for a member to participate in any way in such public offerings if the underwriting or other arrangements in connection with the offering are not in compliance with this Rule or Rule 2810, as applicable: (A)-(E) No change.

(F)Exchange offers of securities where:

(i)The securities to be issued or the securities of the company being acquired are listed on The Nasdaq [National] *Global* Market, the New York Stock Exchange, or the American Stock Exchange; or

(ii)No change.

(G)No change. (8)-(11) No change. (c)-(j) No change. 2790. Restrictions on the Purchase and Sale of Initial Equity Public Offerings (a)-(b) No change.

(c)General Exemptions. The general prohibitions in paragraph

(a)of this rule shall not apply to sales to and purchases by the following accounts or persons, whether directly or through accounts in which such persons have a beneficial interest: (1)-(4) No change.

(5)A publicly traded entity (other than a broker/dealer or an affiliate of a broker/dealer where such broker/dealer is authorized to engage in the public offering of new issues either as a selling group member or underwriter) that:

(A)No change.

(B)Is traded on the Nasdaq [National] *Global* Market; or

(C)Is a foreign issuer whose securities meet the quantitative designation criteria for listing on a national securities exchange or trading on the Nasdaq [National] *Global* Market; (6)-(10) No change. (d)-(h) No change.

(i)Definitions. (1)-(9) No change.

(10)“Restricted person” means: (A)-(D) No change.

(E)Persons Owning a Broker/Dealer. (i)-(iii) No change.

(iv)Any person that directly or indirectly owns 10% or more of a public reporting company listed, or required to be listed, in Schedule A of a Form BD (other than a reporting company that is listed on a national securities exchange or is traded on the Nasdaq [National] *Global* Market, or other than with respect to a limited business broker/dealer);

(v)Any person that directly or indirectly owns 25% or more of a public reporting company listed, or required to be listed, in Schedule B of a Form BD (other than a reporting company that is listed on a national securities exchange or is traded on the Nasdaq [National] *Global* Market, or other than with respect to a limited business broker/dealer);

(vi)No change.

(j)No change. 3350. Short Sale Rule (a)(1) With respect to trades executed on or reported to the ADF, no member shall effect a short sale for the account of a customer or for its own account in a Nasdaq [National] *Global* Market security at or below the current national best (inside) bid when the current national best (inside) bid is below the preceding national best (inside) bid in the security.

(2)With respect to trades executed on or reported to Nasdaq, no member shall effect a short sale for the account of a customer or for its own account in a Nasdaq [National] *Global* Market security at or below the current best (inside) bid displayed in the Nasdaq Market Center when the current best (inside) bid is below the preceding best (inside) bid in the security. (b)-(g) No change. (h)(1) A member shall be permitted, consistent with its quotation obligations, to execute a short sale for the account of an options market maker that would otherwise be in contravention of this Rule, if:

(A)The options market maker is registered with a qualified options exchange as a qualified options market maker in a stock options class on a Nasdaq [National] *Global* Market security or an options class on a qualified stock index; and

(B)No change.

(2)For purposes of this paragraph: (A)(i) An “exempt hedge transaction,” in the context of qualified options market makers in stock options classes, shall mean a short sale in a Nasdaq [National] *Global* Market security that was effected to hedge, and in fact serves to hedge, an existing offsetting options position or an offsetting options position that was created in a transaction(s) contemporaneous with the short sale,* provided that when establishing the short position the options market maker is eligible to receive(s) good faith margin pursuant to Section 220.12 of Regulation T under the Act for that transaction.

(ii)An “exempt hedge transaction,” in the context of qualified options market makers in stock index options classes, shall mean a short sale in a Nasdaq [National] *Global* Market security that was effected to hedge, and in fact serves to hedge, an existing offsetting stock index options position or an offsetting stock index options position that was created in a transaction(s) contemporaneous with the short sale, provided that: a.-c. No change.

(iii)No change.

(B)A “qualified options market maker” shall mean an options market maker who has received an appointment as a “qualified options market maker” for certain classes of stock options on Nasdaq [National] *Global* Market securities and/or index options on qualified stock indexes pursuant to the rules of a qualified options exchange.

(C)No change.

(D)A “qualified stock index” shall mean any stock index that includes one or more Nasdaq [National] *Global* Market securities, provided that more than 10% of the weight of the index is accounted for by Nasdaq [National] *Global* Market securities and provided further that the qualification of an index as a qualified stock index shall be reviewed as of the end of each calendar quarter, and the index shall cease to qualify if the value of the index represented by one or more Nasdaq [National] *Global* Market securities is less than 8% at the end of any subsequent calendar quarter. (E)-(F) No change. (i)(1) No change.

(2)For purposes of this paragraph, an “exempt hedge transaction” shall mean a short sale in a Nasdaq [National] *Global* Market security that was effected to hedge, and in fact serves to hedge, an existing offsetting warrant position or an offsetting warrant position that was created in a transaction(s) contemporaneous with the short sale. * Notwithstanding any other provision of this paragraph, any transaction unrelated to normal warrant market making activity, such as index arbitrage or risk arbitrage that in either case is independent of a warrant market maker's market making functions, will not be considered an “exempt hedge transaction.” * The phrase contemporaneously established includes transactions occurring simultaneously as well as transactions occurring within the same brief period of time. (3)-(4) No change. (j)-(1) No change. IM-3350. Short Sale Rule (a)(1) In developing a Short Sale Rule for Nasdaq [National] *Global* Market securities, NASD adopted an exemption to the Rule for certain market making activity. This exemption was deemed an essential component of the Rule because bona fide market making activity is necessary and appropriate to maintain continuous, liquid markets in Nasdaq [National] *Global* Market securities. Rule 3350(c)(1) states that short selling prohibitions shall not apply to sales by qualified Nasdaq market makers or registered ADF market makers in connection with bona fide market making activity and specifies that transactions unrelated to normal market making activity, such as index arbitrage and risk arbitrage that are independent from a member's market making functions, will not be considered as bona fide market making. Thus two standards are to be applied: One must be a “qualified” Nasdaq market maker or a registered ADF market maker and one must engage in “bona fide” market making activity to take advantage of this exemption. With this interpretation, NASD wishes to clarify for members some of the factors that will be taken into consideration when reviewing market making activity that may not be deemed to be bona fide market making activity and therefore would not be exempted from the Rule's application. (2)-(3) No change. (b)(1) With respect to trades executed on or reported to the ADF, Rule 3350 requires that no member shall effect a short sale for the account of a customer or for its own account in a Nasdaq [National] *Global* Market security at or below the current national best (inside) bid when the current national best (inside) bid is below the preceding national best (inside) bid in the security. NASD has determined that in order to effect a “legal” short sale when the current best bid is lower than the preceding best bid the short sale must be executed at a price of at least $0.01 above the current inside bid when the current inside spread is $0.01 or greater. The last sale report for such a trade would, therefore, be above the inside bid by at least $0.01.

(2)With respect to trades executed on or reported to Nasdaq, Rule 3350 requires that no member shall effect a short sale for the account of a customer or for its own account in a Nasdaq [National] *Global* Market security at or below the current best (inside) bid displayed in the Nasdaq Market Center when the current best (inside) bid is below the preceding best (inside) bid in the security. Nasdaq has detennined that in order to effect a “legal” short sale when the current best bid is lower than the preceding best bid the short sale must be executed at a price of at least $0.01 above the current inside bid when the current inside spread is $0.01 or greater. The last sale report for such a trade would, therefore, be above the inside bid by at least $0.01. (c)-(d) No change. 4200. DEFINITIONS

(a)For purposes of the Rule 4000 Series, unless the context requires otherwise: (1)-(24) No change.

(25)[“Nasdaq National Market” or “NNM” is a distinct tier of The Nasdaq Stock Market comprised of securities that meet the requirements of and are authorized as a Nasdaq National Market security.] *“Nasdaq Global Market” or “NGM” is a distinct tier of Nasdaq comprised of two segments: the Nasdaq Global Market and the Nasdaq Global Select Market. The Nasdaq Global Market is the successor to the Nasdaq National Market.*

(26)“Nasdaq [National] *Global* Market security” or “[NNM] *NGM* security” means any authorized security in the Nasdaq [National] *Global* Market which

(1)satisfies all applicable requirements of the Rule 4300 Series and substantially meets the criteria set forth in the Rule 4400 Series and is subject therefore to a transaction reporting plan approved by the Commission;

(2)is a right to purchase such security;

(3)is a warrant to subscribe to such security; or

(4)is an index warrant which substantially meets the criteria set forth in Rule 4420, and has been designated therefore as a national market system security pursuant to [SEC Rule 11Aa2-1] *Rule 600 of SEC Regulation NMS* .

(27)No change.

(28)“Nasdaq Capital Market security” means any authorized security in The Nasdaq Capital Market which

(1)satisfies all applicable requirements of the Rule 4300 Series other than a Nasdaq [National] *Global* Market security;

(2)is a right to purchase such security; or

(3)is a warrant to subscribe to such security.

(29)“The Nasdaq Stock Market” or “Nasdaq” is an electronic securities market comprised of competing market makers whose trading is supported by a communications network linking them to quotation dissemination, trade reporting, and order execution systems. This market also provides specialized automation services for screen-based negotiations of transactions, on-line comparison of transactions, and a range of informational services tailored to the needs of the securities industry, investors and issuers. [The Nasdaq Stock Market consists of two distinct market tiers: the “Nasdaq National Market” or “NNM,” and “The Nasdaq Capital Market”.] The Nasdaq Stock Market is operated by The Nasdaq Stock Market, Inc., a wholly-owned subsidiary of the Association.

(30)[Reserved.]

(a)*“Nasdaq Global Select Market” or “NGSM” is a segment of the Nasdaq Global Market comprised of NGM securities that met the requirements for initial inclusion contained in Rules 4425, 4426 and 4427.* *(b) “Nasdaq Global Select Market security” or “NGSM security” means any security listed on Nasdaq and included in the Nasdaq Global Select segment of the Nasdaq Global Market.* (31)-(39) No change.

(b)No change. 4310. Qualification Requirements for Domestic and Canadian Securities To qualify for inclusion in Nasdaq, a security of a domestic or Canadian issuer shall satisfy all applicable requirements contained in paragraphs

(a)or (b), and

(c)hereof. (a)-(b) No change.

(c)In addition to the requirements contained in paragraph

(a)or

(b)above, and unless otherwise indicated, a security shall satisfy the following criteria for inclusion in Nasdaq: (1)-(8) No change. (9)(A)-(B) No change.

(C)In the case of index warrants, the criteria established in the Rule 4400 Series for Nasdaq [National] *Global* Market securities shall apply. (10)-(30) No change.

(d)No change. 4350. Qualitative Listing Requirements for Nasdaq [National Market and Nasdaq Capital Market] Issuers Except for Limited Partnerships No change. 4350-1 Qualitative Listing Requirements for Nasdaq (National Market and Nasdaq Capital Market] Issuers Except for Limited Partnerships No change. 4400. Nasdaq [National] *Global* Market—Issuer Designation Requirements No change. IM-4400. Impact of Non-Designation of Dually Listed Securities To foster competition among markets and further the development of the national market system following the repeal of NYSE Rule 500, Nasdaq shall permit issuers whose securities are listed on the New York Stock Exchange to apply also to list those securities on the Nasdaq [National] *Global* Market ([“NNM”] *“NGM”* ). Nasdaq shall make an independent determination of whether such issuers satisfy all applicable listing requirements and shall require issuers to enter into a dual listing agreement with Nasdaq. While Nasdaq shall certify such dually listed securities for listing on the [NNM] *NGM* , Nasdaq shall not exercise its authority under the NASD Rule 4400 Series separately to designate or register such dually listed securities as Nasdaq national market system securities within the meaning of Section 11A of the Securities Exchange Act of 1934 or the rules thereunder. As a result, these securities, which are already designated as national market system securities under the Consolidated Quotation Service (“CQS”) and Consolidated Tape Association national market system plans (“CQ and CTA Plans”), shall remain subject to those plans and shall not become subject to the Nasdaq UTP Plan, the national market system plan governing securities designated by the Nasdaq Stock Market. For purposes of the national market system, such securities shall continue to trade under their current one, two, or three-character ticker symbol. Nasdaq shall continue to send all quotations and transaction reports in such securities to the processor for the CTA Plan. In addition, dually listed issues that are currently eligible for trading via the Intermarket Trading System (“ITS”) shall remain so and continue to trade on the Nasdaq Intermarket trading platform as they do today. Through this interpretation, Nasdaq also resolves any potential conflicts that arise under NASD rules as a result of a single security being both a CQS security, which is subject to one set of rules, and a listed [NNM] *NGM* security, which is subject to a different set of rules. Specifically, dually listed securities shall be Nasdaq securities for purposes of rules related to listing and delisting, and shall remain as CQS securities under all other NASD rules. Treating dually listed securities as CQS securities under NASD rules is consistent with their continuing status as CQS securities under the CTA, CQ, and ITS national market system, as described above. This interpretation also preserves the status quo and avoids creating potential confusion for investors and market participants that currently trade these securities on the Nasdaq InterMarket. For example, Nasdaq shall continue to honor the trade halt authority of the primary market under the CQ and CT Plans. NASD Rule 4120(a)(2) and

(3)governing CQS securities shall apply to dually listed securities, whereas NASD Rule 4120(a)(1), (4), (5), (6), and

(7)shall not. SEC Rule 10a-1 governing short sales of CQS securities shall continue to apply to dually listed securities, rather than NASD Rule 3350 governing short sales of Nasdaq listed securities. Market makers in dually listed securities shall retain all obligations imposed by the NASD Rule 5200, 6300, and 6400 Series regarding quoting, trading, and transaction reporting of CQS securities rather than assuming the obligations appurtenant to quoting, trading, and transaction reporting of Nasdaq listed securities. The fees applicable to CQS securities set forth in NASD Rule 7010 shall continue to apply to dually listed issues. 4420. Quantitative Designation Criteria In order to be designated for the Nasdaq [National] *Global* Market, an issuer shall be required to substantially meet the criteria set forth in paragraphs (a), (b), (c), (d), (e), (f), (g), (h), (i), (j), (k),

(l)or

(m)below. Initial Public Offerings substantially meeting such criteria are eligible for immediate inclusion in the Nasdaq [National] *Global* Market upon prior application and with the written consent of the managing underwriter that immediate inclusion is desired. All other qualifying issues, excepting special situations, are included on the next inclusion date established by Nasdaq. (a)-(e) No change.

(f)Other Securities.

(1)No change.

(2)Issuers of securities designated pursuant to this paragraph [(e)] ( *f* ) must be listed on the Nasdaq [National] *Global* Market or the New York Stock Exchange

(NYSE)or be an affiliate of a company listed on the Nasdaq [National] *Global* Market or the NYSE; provided, however, that the provisions of Rule 4450 will be applied to sovereign issuers of “other” securities on a case-by-case basis.

(3)No change.

(g)Nasdaq will consider designating as Nasdaq [National] *Global* Market securities Selected Equity-linked Debt Securities (SEEDS) that generally meet the criteria of this paragraph (g). SEEDS are limited-term, non-convertible debt securities of an issuer where the value of the debt is based, at least in part, on the value of another issuer's common stock or non-convertible preferred stock (or sponsored American Depositary Receipts

(ADRs)overlying such equity securities).

(1)Issuer Listing Standards.

(A)The issuer of a SEEDS must be an entity that:

(i)Is listed on the Nasdaq [National] *Global* Market or the New York Stock Exchange

(NYSE)or is an affiliate of a company listed on the Nasdaq [National] *Global* Market or the NYSE; provided, however, that the provisions of Rule 4450 will be applied to sovereign issuers of SEEDS on a case-by-case basis; and

(ii)No change.

(B)In addition, the market value of a SEEDS offering, when combined with the market value of all other SEEDS offerings previously completed by the issuer and traded on the Nasdaq [National] *Global* Market or a national securities exchange, may not be greater than 25 percent of the issuer's net worth at the time of issuance.

(2)No change.

(3)Minimum Standards Applicable to the Linked Security. An equity security on which the value of the SEEDS is based must:

(A)No change.

(B)Be issued by a company that has a continuous reporting obligation under the Act, and the security must be listed on the Nasdaq [National] *Global* Market or a national securities exchange and be subject to last sale reporting; and

(C)No change. (4)-(5) No change.

(h)Units.

(1)Initial and Continued Inclusion Requirements.

(a)No change.

(b)All debt components of a unit, if any, shall meet the following requirements:

(i)No change.

(ii)the issuer of the debt security must have equity securities listed on the Nasdaq [National] *Global* Market; and

(iii)No change.

(c)No change.

(2)No change.

(3)Disclosure Requirements for Units. Each Nasdaq [National] *Global* Market issuer of units shall include in its prospectus or other offering document used in connection with any offering of securities that is required to be filed with the Commission under the federal securities laws and the rules and regulations promulgated thereunder a statement regarding any intention to delist the units immediately after the minimum inclusion period. The issuer of a unit shall further provide information regarding the terms and conditions of the components of the unit (including information with respect to any original issue discount or other significant tax attributes of any component) and the ratio of the components comprising the unit. An issuer shall also disclose when a component of the unit is separately listed on Nasdaq. These disclosures shall be made on the issuer's website, or if it does not maintain a website, in its annual report provided to unit holders. An issuer shall also immediately publicize through, at a minimum, a public announcement through the news media, any change in the terms of the unit, such as changes to the terms and conditions of any of the components (including changes with respect to any original issue discount or other significant tax attributes of any component), or to the ratio of the components within the unit. Such public notification shall be made as soon as practicable in relation to the effective date of the change. (i)-(m) No change. 4425. Nasdaq Global Select Market *(a) An issuer that applies for listing on the Nasdaq Global Market and meets the requirements for initial listing contained in Rule 4426 shall be listed on the Nasdaq Global Select Market.* *(b) Each October, beginning in October 2007, Nasdaq will review the qualifications of all securities listed on the Nasdaq Global Market that are not included in the Nasdaq Global Select Market. Any security that meets the requirements for initial listing on the Nasdaq Global Select Market contained in Rule 4426 at the time of this review will be transferred to the Global Select Market the following January, provided it meets the continued listing criteria at that time. An issuer will not owe any application or entry fees in connection with such a transfer.* *(c) At any time, an issuer may apply to transfer a security listed on the Nasdaq Global Market to the Nasdaq Global Select Market. Such an application will be approved and effected as soon as practicable if the security meets the requirements for initial listing contained in Rule 4426. An issuer will not owe any application or entry fees in connection with such a transfer.* *(d) At any time, an issuer may apply to transfer a security listed on the Nasdaq Capital Market to the Nasdaq Global Select Market. Such an application will be approved and effected as soon as practicable if the security meets the requirements for initial listing contained in Rule 4426. An issuer transferring from the Nasdaq Capital Market to the Nasdaq Global Select Market will be required to pay the applicable fees contained in Rule 4510.* *(e) After initial inclusion on the Nasdaq Global Select Market, an issuer will remain on the Nasdaq Global Select Market provided it continues to meet the applicable requirements of the Rule 4300 and 4400 Series, including the qualitative requirements of Rule 4350 and IM-4300.* *

(f)Notwithstanding any provision to the contrary, the securities of any issuer that is non-compliant with a qualitative listing requirement that does not provide for a grace period, or where Nasdaq staff has raised a public interest concern, will not be permitted to transfer to the Global Select Market until the underlying deficiency is resolved. In addition, any security that is below a quantitative continued listing requirement for the Nasdaq Global Market, even if the issuer has not been below the requirement for a sufficient period of time to be considered non-compliant, and any issuer in a grace or compliance period with respect to a quantitative listing requirement, will not be allowed to transfer from the Nasdaq Global or Capital Markets to the Nasdaq Global Select Market until the underlying deficiency is resolved. Nor will any issuer before a Nasdaq Listing Qualifications Panel be allowed to transfer to the Global Select Market until the underlying deficiency is resolved. An issuer that is in a grace or compliance period with respect to a qualitative listing standard, such as the cure period for filling an audit committee vacancy, will be allowed to transfer to the Global Select Market, subiect to the continuation of that grace period. * IM-4425 Launch of the Nasdaq Global Select Market *In connection with the initial launch of the Nasdaq Global Select Market in July 2006, Nasdaq will review all issuers' qualifications and assign qualified Global Market companies to the new Global Select segment. In addition, qualified Capital Market companies will be given the opportunity to be included in the new segment. In connection with this initial transfer to the Global Select Market, Nasdaq will begin to make its assessment using the most recent financial data filed as of April 28, 2006, and market data as of April 28, 2006. Nasdaq will treat as an IPO any company that initially listed as an IPO since May 1, 2005 for purposes of the liquidity tests, because these companies would have insufficient market data to establish a 12-month trading history and may have had insufficient time to satisfy the market value of public float requirement applicable to other companies. Similarly, for purposes of the market capitalization requirements of Rules 4426(c)(2) and (c)(3), anv company that initially listed as an IPO since May 1, 2005 must have the applicable average market capitalization from the date of listing. Nasdaq also notes that certain Nasdaq-listed issuers that qualify to initially list on the New Yark Stock Exchange

(NYSE)will not be eligible to list on the Global Select Market. Nasdaq will allow (but not require) any Nasdaq-listed issuer that meets the NYSE initial listing standards as of July 2006 but that does not qualify for the Global Select segment when it is adopted to be included in the Global Select Market, subiect to a grace period until January 1, 2008 to achieve compliance with all listing criteria for the Global Select Market. Any issuer that avails itself of this grace period that has not achieved compliance with all listing criteria for the Global Select Market by January 1, 2008 will be moved to the Nasdaq Global Market. In addition, any issuer that avails itself of this grace period will remain subiect to delisting in the event it fails to satisfy any of the continued listing requirements far the Nasdaq Global Market.* 4426. Nasdaq Global Select Market Listing Requirements *(a) For inclusion in the Nasdaq Global Select Market, an issuer must meet the requirements of paragraphs (b), (c), and

(d)of this rule, and all applicable requirements of the Rule 4300 and 4400 Series, including the qualitative requirements of Rule 4350 and IM-4300. Rule 4427 provides guidance about computations made under this Rule 4426.* *(b) Liquidity Requirements.* *(1) The security must demonstrate either:* *(i) A minimum of 550 beneficial shareholders, and* *(ii) An average monthly trading volume over the prior 12 months of at least 1,100,000 shares per month; or* *(B) A minimum of 2,200 beneficial shareholders; or* *(C) A minimum of 450 beneficial shareholders, in the case of:

(i)an issuer listing in connection with its emergence from a bankruptcy or reorganization proceeding; or

(ii)an issuer that is affiliated with another company listed on the Global Select Market.* *(2) The security must have at least 1,250,000 publicly held shares; and* *(3) The publicly held shares must have either:* *(A) A market value of at least $110 million; or* *(B) A market value of at least $100 million, if the issuer has stockholders' equity of at least $110 million; or* *(C) A market value of at least $70 million in the case of:

(i)an issuer listing in connection with its initial public offering;

(ii)an issuer that is affiliated with, or a spin-off from, another company listed on the Global Select Market; and

(iii)a closed end management investment company registered under the Investment Company Act of 1940.* *(c) Financial Requirements. An issuer, other than a closed end management investment company, must meet the requirements of one of subparagraphs (1),

(2)or

(3)of this paragraph.* *(1) The issuer must have:* *(A) Aggregate income from continuing operations before income taxes of at least $11 million over the prior three fiscal years:* *(B) Positive income from continuing operations before income taxes in each of the prior three fiscal years: and* *(C) At least $2.2 million income from continuing operations before income taxes in each of the two most recent fiscal years; or* *(2) The issuer must have:* *(A) Aggregate cash flows of at least $27.5 million over the prior three fiscal years;* *(B) Positive cash flows in each of the prior three fiscal years; and* *(C) Both:* *(i) Average market capitalization of at least $550 million over the prior 12 months; and* *(ii) Total revenue of at least $110 million in the previous fiscal year; or* *(3) The issuer must have both:* *(A) Average market capitalization of at least $850 million over the prior 12 months; and* *(B) Total revenue of at least $90 million in the previous fiscal year.* *(d) Price. For inclusion in the Nasdaq Global Select Market, an issuer not listed on the Nasdaq Global Market shall have a minimum bid price of $5 per share.* *(e) Closed End Management Investment Companies.* *(1) A closed end management investment company registered under the Investment Company Act of 1940 shall not be required to meet paragraph

(c)of this Rule 4426.* *(2) In lieu of the requirement in paragraph (b)(3) of this Rule 4426, a closed end management investment company that is listed concurrently with other closed end management investment companies that have a common investment adviser or whose investment advisers are “affiliated persons,” as defined in the Investment Company Act of 1940 (a “Fund Family”) shall be eligible if:

(A)the total market value of publicly held shares in such Fund Family is at least $220 million;

(B)the average market value of publicly held shares for all funds in the Fund Family is $50 million; and

(C)each fund in the Fund Family has a market value of publicly held shares of at least $35 million.* *

(f)Other Classes of Securities. If the common stock of an issuer is included in the Nasdaq Global Select Market, any other security of that same issuer, such as other classes of common or preferred stock, that qualify for listing on the Nasdaq Global Market shall also be included in the Global Select Market. * Rule 4427. Computations and Definitions *(a) In computing the number of publicly held shares for purposes of Rule 4426(b), Nasdaq will not consider shares held by an officer, director or 10% shareholder of the issuer.* *(b) In calculating income from continuing operations before income taxes for purposes of Rule 4426(c)(1), Nasdaq will rely on an issuer's financial information as filed with the Commission in the issuer's most recent periodic report and/or registration statement.* *(c) In calculating cash flows for purposes of Rule 4426(c)(2). Nasdaq will rely on the net cash provided by operating activitives. as reported in the issuer's financial information as filed with the Commission in the issuer's most recent periodic report and/or registration statement, excluding changes in working capital or in operating assets and liabilities.* *(d) If an issuer does not have three years of publicly reported financial data, it may qualify under Rule 4426(c)(I) if it has:* *(1) Reported aggregate income from continuing operations before income taxes of at least $11 million and* *(2) Positive income from continuing operations before income taxes in each of the reported fiscal years.* *(e) If an issuer does not have three years of publicly reported financial data, it may qualify under Rule 4426(c)(2) if it has:* *(1) Reported aggregate cash flows of at least $27.5 million and* *(2) Positive cash flows in each of the reported fiscal years.* *(f) A period of less than three months shall not be considered a fiscal year, even if reported as a stub period in the issuer's publicly reported financial statements.* *(g) For purposes of Rule 4426, an issuer is affiliated with another company if that other company, directly or indirectly though one or more intermediaries, controls. is controlled by, or is under common control of the issuer. Control, for these purposes. means having the ability to exercise significant influence. Ability to exercise significant influence will be presumed to exist where the parent or affiliated company directly or indirectly owns 20% or more of the other company's voting securities, and also can be indicated by representation on the board of directors, participation in policy making processes, material intercompany transactions, interchange of managerial personnel, or technological dependency.* *(h) In the case of an issuer listing in connection with its initial public offering, compliance with the market capitalization requirements of Rules 4426(c)(2) and (c)(3) will be based on the company's market capitalization at the time of listing.* 4430. Limited Partnership Rollup Designation Criteria In addition to meeting the quantitative criteria for Nasdaq [National] *Global* Market inclusion, an issuer that is formed as a result of a limited partnership rollup transaction, as defined in Rule 4200, must meet the criteria set forth below in order to be designated: (a)-(b) No change. 4440. Registration Standards

(a)In addition to meeting the quantitative criteria and the limited partnership rollup criteria, if applicable, for Nasdaq [National market] *Global Market* inclusion, the issue must also be: (1)-(4) No Change

(5)Registered under Section 12(b) of the Act and listed on a national securities exchange, or admitted to unlisted trading privileges on an exchange, provided that:

(A)No change.

(B)Such exchange shall permit Nasdaq market makers telephone access to exchange trading facilities with respect to transactions in [NNM] *NGM* securities to the same extent that exchange market makers are permitted access to Nasdaq market makers; and

(C)No change.

(b)Foreign securities and American Depositary Receipts where either the issuer is required to file reports pursuant to Section 15(d) of the Act or the security is exempt from registration under Section 12(g) of the Act by reason of the applicability of SEC Rule 12g3-2(b) are not eligible for designation in the Nasdaq [National] *Global* Market. 4450. Quantitative Maintenance Criteria After designation as a Nasdaq [National] *Global* Market security, a security must substantially meet the criteria set forth in paragraphs

(a)or (b), and (c), (d), (e), (f), (g),

(h)or

(i)below to continue to be designated as a national market system security. A security maintaining its designation under paragraph

(b)need not also be in compliance with the quantitative maintenance criteria in the Rule 4300 series. (a)-(h) No change.

(i)Transfers between The Nasdaq [National] *Global* and Capital Markets For Bid Price Deficient Issuers

(1)If a [National] *Global* Market issuer has not been deemed in compliance prior to the expiration of the compliance period for bid price provided in Rule 4450(e)(2), it may transfer to The Nasdaq Capital Market, provided that it meets all applicable requirements for initial inclusion on the Capital Market set forth in Rule 4310(c) or Rule 4320(e), as applicable, other than the minimum bid price requirement. A Nasdaq [National] *Global* Market issuer transferring to The Nasdaq Capital Market must pay the entry fee set forth in Rule 4520(a). The issuer may also request a hearing to remain on The Nasdaq National Market pursuant to the Rule 4800 Series.

(2)Following a transfer to The Nasdaq Capital Market pursuant to paragraph (1), a Nasdaq [National] *Global* Market issuer will be afforded the remainder *of* any compliance period set forth in Rule 4310(c)(8)(D) or Rule 4320(e)(2)(E)(ii) as if the issuer had been listed on The Nasdaq Capital Market. The compliance periods afforded by this rule and any time spent in the hearing process will be deducted in determining the length of the remaining applicable compliance periods on The Nasdaq Capital Market. 4510. The Nasdaq [National] *Global* Market

(a)Entry Fee

(1)An issuer that submits an application for inclusion of any class of its securities (not otherwise identified in this Rule 4500 series) in The Nasdaq [National] *Global* Market, shall pay to The Nasdaq Stock Market, Inc. a fee calculated on total shares outstanding, according to the following schedule. This fee will be assessed on the date of entry in The Nasdaq [National] *Global* Market, except for $5,000 which represents a non-refundable, application fee, and which must be submitted with the issuer's application. Up to 30 million shares $100,000 30+ to 50 million shares 125,000 Over 50 million shares 150,000

(2)Total shares outstanding means the aggregate of all classes of equity securities to be included in The Nasdaq [National] *Global* Market as shown in the issuer's most recent periodic report or in more recent information held by Nasdaq or, in the case of new issues, as shown in the offering circular, required to be filed with the issuer's appropriate regulatory authority. In the case of foreign issuers, total shares outstanding shall include only those shares issued and outstanding in the United States.

(3)A closed-end management investment company registered under the Investment Company Act of 1940, as amended (a “Closed-End Fund”), that submits an application for inclusion of a class of securities in The Nasdaq [National] *Global* Market shall pay to the Nasdaq Stock Market, Inc. an entry fee of $5,000 (of which $1,000 represents a non-refundable, application fee).

(4)An issuer that submits an application for inclusion of any class of rights in The Nasdaq [National] *Global* Market, shall pay, at the time of its application, a non-refundable application fee of $I,000 to The Nasdaq Stock Market, Inc. (5)-(6) No change.

(7)The fees described in this Rule 4510(a) shall not be applicable with respect to any securities that

(i)are listed on a national securities exchange but not listed on Nasdaq, if the issuer of such securities transfers their listing exclusively to the Nasdaq [National] *Global* Market; or

(ii)are listed on the New York Stock Exchange and Nasdaq, if the issuer of such securities ceases to maintain their listing on the New York Stock Exchange and the securities instead are designated as national market securities under the Rule 4400 Series.

(8)No change.

(9)An issuer that transfers its listing from The Nasdaq Capital Market to The Nasdaq [National] *Global* Market shall pay the entry fee described in this Rule 4510(a) less the entry fee that was previously paid by the issuer to Nasdaq in connection with listing on The Nasdaq Capital Market. Such issuer is not required to pay the application fee described in Rule 4510(a) in connection with the application to transfer listing.

(10)An issuer that submits an application for listing on The Nasdaq Capital Market, but prior to listing revises its application to seek listing on The Nasdaq [National] *Global* Market, is not required to pay the application fee described in Rule 4510(a) in connection with the revised application.

(b)Additional Shares. No change.

(c)Annual Fee—Domestic and Foreign Issues.

(1)The issuer of each class of securities (not otherwise identified in this Rule 4500 series) that is a domestic or foreign issue listed in The Nasdaq [National] *Global* Market shall pay to The Nasdaq Stock Market, Inc. an annual fee calculated on total shares outstanding according to the following schedule: Up to 10 million shares $24,500 10+ to 25 million shares 30,500 25+ to 50 million shares 34,500 50+ to 75 million shares 44,500 75+ to 100 million shares 61,750 Over 100 million shares 75,000

(2)No change.

(3)If a class of securities is removed from the Nasdaq [National] *Global* Market that portion of the annual fees for such class of securities attributable to the months following the date of removal shall not be refunded, [expect] *except* such portion shall be applied to The Nasdaq Capital Market fees for that calendar year.

(4)Total shares outstanding means the aggregate of all classes of equity securities included in the Nasdaq [National] *Global* Market as shown in the issuer's most recent periodic report required to be filed with the issuer's appropriate regulatory authority or in more recent information held by Nasdaq. In the case of foreign issuers, total shares outstanding shall include only those shares issued and outstanding in the United States.

(5)No change.

(d)Annual Fee—American Depositary Receipts

(ADRs)and Closed-End Funds.

(1)The issuer of each class of securities that is an ADR listed in The Nasdaq [National] *Global* Market shall pay to The Nasdaq Stock Market, Inc. an annual fee calculated on ADRs outstanding according to the following schedule not to exceed $30,000 per issuer: Up to 10 million ADRs $21,225 10+ to 25 million ADRs 26,500 25+ to 50 million ADRs 29,820 Over 50 million ADRs 30,000

(2)ADRs outstanding means the aggregate of all classes of ADRs included in The Nasdaq [National] *Global* Market as shown in the issuer's most recent periodic report required to be filed with the issuer's appropriate regulatory authority or in more recent information held by Nasdaq.

(3)A Closed-End Fund listed in The Nasdaq [National] *Global* Market shall pay to The Nasdaq Stock Market, Inc. an annual fee calculated based on total shares outstanding according to the following schedule: Up to 5 million shares $15,000 5+ to 10 million shares 17,500 10+ to 25 million shares 20,000 25+ to 50 million shares 22,500 50+ to 100 million shares 30,000 100+ to 250 million shares 50,000 Over 250 million shares 75,000

(4)For the purpose of determining the total shares outstanding, fund sponsors may aggregate shares outstanding of all Closed-End Funds in the same fund family listed in The Nasdaq [National] *Global* Market or The Nasdaq Small Cap Market, as shown in the issuer's most recent periodic reports required to be filed with the appropriate regulatory authority or in more recent information held by Nasdaq. The maximum annual fee applicable to a fund family shall not exceed $75,000. For purposes of this rule, a “fund family” is defined as two or more Closed-End Funds that have a common investment adviser or have investment advisers who are “affiliated persons” as defined in Section 2(a)(3) of the Investment Company Act of 1940, as amended.

(5)No change.

(6)If a class of securities is removed from the Nasdaq [National] *Global* Market, that portion of the annual fees for such class of securities attributable to the months following the date of removal shall not be refunded, except such portion shall be applied to The Nasdaq Capital Market fees for that calendar year. (e)-(f) No change. 4520. The Nasdaq Capital Market

(a)Entry Fee (1)-(6) No change.

(7)The fees described in this Rule 4520(a) shall not be applicable with respect to any securities that

(i)are listed on a national securities exchange but not listed on Nasdaq, if the issuer of such securities transfers their listing exclusively to the Nasdaq [National] *Capital* Market; or

(ii)are listed on the New York Stock Exchange and Nasdaq, if the issuer of such securities ceases to maintain their listing on the New York Stock Exchange and the securities instead are designated under the plan applicable to Nasdaq Capital Market securities.

(8)No change.

(9)An issuer that submits an application for listing on The Nasdaq [National] *Global* Market, but prior to listing revises its application to seek listing on The Nasdaq Capital Market, is not required to pay the application fee described in Rule 4520(a) in connection with the revised application.

(b)No change.

(c)Annual Fee. (1)-(4) No change.

(5)If a class of securities is removed from The Nasdaq Capital Market, that portion of the annual fees for such class of securities attributable to the months following the date of removal shall not be refunded, except such portion shall be applied to Nasdaq [National] *Global* Market fees for that calendar year.

(6)No change.

(7)Notwithstanding paragraph (6), for the purpose of detennining the total shares outstanding, fund sponsors may aggregate shares outstanding of all Closed-End Funds in the same fund family listed in The Nasdaq [National] *Global* Market or The Nasdaq Capital Market, as shown in the issuer's most recent periodic reports required to be filed with the appropriate regulatory authority or in more recent infonnation held by Nasdaq. The maximum, annual fee applicable to a fund family shall not exceed $75,000. For purposes of this rule, a “fund family” is defined as two or more Closed-End Funds that have a common investment adviser or have investment advisers who are “affiliated persons” as defined in Section 2(a)(3) of the Investment Company Act of 1940, as amended.

(8)No change. (d)-(e) No change. 4530. Other Securities

(a)Application Fee and Entry Fee.

(1)When an issuer submits an application for inclusion of any Other Security or SEEDS in the Nasdaq [National] *Global* Market qualified for listing under Rule 4420(f) or 4420(g), it shall pay a non-refundable Application Fee of $1,000.

(2)When an issuer submits an application for inclusion of any Other Security or SEEDS in the Nasdaq [National] *Global* Market qualified for listing under Rule 4420(f) or 4420(g), it shall pay an Entry Fee calculated based on total shares outstanding according to the following schedule: Up to 1 million shares $5,000 1+ to 2 million shares 10,000 2+ to 3 million shares 15,000 3+ to 4 million shares 17,500 4+ to 5 million shares 20,000 5+ to 6 million shares 22,500 6+ to 7 million shares 25,000 7+ to 8 million shares 27,500 8+ to 9 million shares 30,000 9+ to 10 million shares 32,500 10+ to 15 million shares 37,500 Over 15 million shares 45,000 The applicable Entry Fee shall be reduced by any Entry Fees paid previously in connection with the initial inclusion during the current calendar year of any of the issuer's Other Securities and SEEDS in the Nasdaq [National] *Global* Market.

(3)For the sole purpose of determining the Entry Fee, total shares outstanding means the aggregate of all classes of Other Securities and SEEDS of the issuer to be included in the Nasdaq [National] *Global* Market in the current calendar year as shown in the issuer's most recent periodic report or in more recent information held by Nasdaq or, in the case of new issues, as shown in the offering circular, required to be filed with the issuer's appropriate regulatory authority. (4)-(5) No change.

(b)Annual Fee.

(1)The issuer of Other Securities or SEEDS qualified under Rule 4420(f) or 4420(g) for listing on the Nasdaq [National] *Global* Market shall pay to The Nasdaq Stock Market, Inc. an Annual Fee calculated based on total shares outstanding according to the following schedule: Up to 5 million shares $15,000 5+ to 10 million shares 17,500 10+ to 25 million shares 20,000 25+ to 50 million shares 22,500 Over 50 million shares 30,000

(2)No change.

(3)For the sole purpose of determining the Annual Fee, total shares outstanding means the aggregate of all classes of Other Securities and SEEDS of the issuer included in the Nasdaq [National] *Global* Market, as shown in the issuer's most recent periodic report required to be filed with the issuer's appropriate regulatory authority or in more recent information held by Nasdaq. 4540. Portfolio Depository Receipts and Index Fund Shares

(a)Entry Fee.

(1)When an issuer submits an application for listing a series of Portfolio Depository Receipts or Index Fund Shares in The Nasdaq [National] *Global* Market, it shall pay to The Nasdaq Stock Market, Inc. a listing fee of $5,000 (which shall include a $1,000 non-refundable processing fee). (2)-(3) No change.

(b)Annual Fee.

(1)The issuer of a series of Portfolio Depository Receipts or Index Fund Shares listed on The Nasdaq [National] *Global* Market shall pay to The Nasdaq Stock Market, Inc. an annual fee calculated on total shares outstanding according to the following schedule: Up to 1 million shares $6,500 1+ to 2 million shares 7,000 2+ to 3 million shares 7,500 3+ to 4 million shares 8,000 4+ to 5 million shares 8,500 5+ to 6 million shares 9,000 6+ to 7 million shares 9,500 7+ to 8 million shares 10,000 8+ to 9 million shares 10,500 9+ to 10 million shares 11,000 10+ to 11 million shares 11,500 11+ to 12 million shares 12,000 12+ to 13 million shares 12,500 13+ to 14 million shares 13,000 14+ to 15 million shares 13,500 15+ to 16 million shares 14,000 Over 16 million shares 14,500

(2)Total shares outstanding means the aggregate number of shares in all series of Portfolio Depository Receipts or Index Fund Shares to be included in The Nasdaq [National] *Global* Market as shown in the issuer's most recent periodic report required to be filed with the issuer's appropriate regulatory authority or in more recent information held by Nasdaq.

(3)No change. 4550. Written Interpretations of Nasdaq Listing Rules

(a)An issuer listed on The Nasdaq Capital Market or The Nasdaq [National] *Global* Market may request from Nasdaq a written interpretation of the Rules contained in the 4000 through 4500 Series. In connection with such a request, the issuer must submit to The Nasdaq Stock Market, Inc. a non-refundable fee of $2,000. A response to such a request generally will be provided within four weeks from the date Nasdaq receives all information necessary to respond to the request. (b)-(e) No change. 4612. Primary Nasdaq Market Maker Standards

(a)A member registered as a Nasdaq market maker pursuant to Rule 4611 may be deemed to be a Primary Nasdaq Market Maker in Nasdaq [National] *Global* Market securities if the market maker complies with threshold standards (as established and published by the Association from time to time) in the following qualification criteria: (1)-(3) No change.

(b)A market maker for a Nasdaq [National] *Global* Market security must satisfy the threshold standards in at least two of the criteria in paragraph

(a)in order to be designated a Primary Nasdaq Market Maker in that security; provided however, that if a market maker satisfies only one of the criteria, it may qualify as a Primary Nasdaq Market Maker if it also accounts for a threshold level of proportionate volume in the security (as established and published by the Association from time to time). ** ** No change. (c)-(f) No change.

(g)In registration situations:

(1)To register and immediately become a Primary Nasdaq Market Maker in a Nasdaq [National] *Global* Market security, a member must be a Primary Nasdaq Market Maker in 80% of the securities in which it has registered. If the market maker is not a Primary Nasdaq Market Maker in 80% of its stocks, it may qualify as a Primary Nasdaq Market Maker in that stock if the market maker registers in the stock as a regular Nasdaq market maker and satisfies the qualification criteria for the next review period.

(2)Notwithstanding paragraph (g)(1) above, after an offering in a stock has been publicly announced or a registration statement has been filed, no market maker may register in the stock as a Primary Nasdaq Market Maker unless it meets the requirements set forth below:

(A)For secondary offerings:

(i)The secondary offering has become effective and the market maker has satisfied the qualification criteria in the time period between registering in the security and the offering becoming effective; provided, however, that if the member is a manager or co-manager of the underwriting syndicate for the secondary offering and it is a PMM in 80% or more of the Nasdaq [National] *Global* Market securities in which it is registered, the member is eligible to become a PMM in the issue prior to the effective date of the secondary offering regardless of whether the member was a registered market maker in the stock before the announcement of the secondary offering; or

(ii)No change. (B)-(C) No change.

(3)No change.

(h)No change. 4613. Character of Quotations

(a)Quotation Requirements and Obligations.

(1)Two-Sided Quote Obligation. For each security in which a member is registered as a market maker, the member shall be willing to buy and sell such security for its own account on a continuous basis and shall enter and maintain a two-sided quotation (“Principal Quote”), which is attributed to the market maker by a special maker participant identifier (“MPID”) and is displayed in the Nasdaq Quotation Montage at all times, subject to the procedures for excused withdrawal set forth in Rule 4619.

(A)No change.

(B)Minimum Price Variation—The minimum quotation increment for Nasdaq [National] *Global* Market and Capital Market securities shall be $0.01 for quotations priced at or above $1.00 per share and $0.0001 for quotations priced below $1.00 per share; provided, however, that if the Securities and Exchange Commission (“SEC”) permits, with respect to any security, the display, rank or acceptance of quotations priced at or above $1.00 per share in an increment smaller than $0.01, then the minimum quotation increment for such a security shall be the minimum permitted by the SEC or $0.0001, whichever is greater. Quotations failing to meet this standard shall be rejected. (2)-(3) No change. (b)-(e) No change. 4630. Reporting Transactions in Nasdaq [National] *Global* Market Securities This Rule 4630 Series applies to the reporting by members of transactions in Nasdaq [National] *Global* Market securities (“designated securities”) to the Nasdaq Market Center. 4652. Transaction Reporting (a)-(c) No change.

(d)Procedures for Reporting Price and Volume * * For examples of reporting procedures, refer to the Rule 4630 Series, Reporting Transactions in Nasdaq [National] *Global* Market Securities. No change. (e)-(g) No change. 4701. Definitions (a)-(ee) No change.

(ff)The term “UTP Exchange” shall mean any registered national securities exchange that elects to participate in the Nasdaq Market Center and that has unlisted trading privileges in Nasdaq [National] *Global* Market securities pursuant to the Joint Self-Regulatory Organization Plan Governing the Collection, Consolidation and Dissemination of Quotation and Transaction Information for Exchange-Listed Nasdaq/National Market System Securities Traded on Exchanges on an Unlisted Trading Privilege Basis (“Nasdaq UTP Plan”). (gg)-(vv) No change. 4200A. Definitions

(a)Unless the context requires otherwise, the terms used in the Rule 4000A and Rule 6000A Series shall have the meanings below. Terms not specifically defined below shall have the meaning in NASD's By-Laws and Rules and SEC [Rule 11Aa3-1] *Regulation NMS.*

(1)No change.

(2)“ADF-eligible security” means a Nasdaq [National] *Global* Market, Nasdaq Capital Market security and Nasdaq Convertible Debt securities. (3)-(4) No change.

(5)“Nasdaq [National] *Global* Market” or [“NNM”] *NGM* is a distinct tier of the Nasdaq Stock Market comprised of securities that meet the requirements of and are authorized as a Nasdaq [National] *Global* Market Security. (6)-(13) No change.

(b)No change. 5410. Applicability

(a)For a period of time, NASD will operate two facilities for collecting trade reports for executions in Nasdaq [National] *Global* Market, Nasdaq Capital Market, and Nasdaq Convertible Debt securities (“designated securities”): The Nasdaq Stock Market and the Alternative Display Facility (“ADF”). Nasdaq will operate the Nasdaq Market Center (including its trade reporting service), and NASD, through the ADF, will operate Trade Reporting and Comparison Service (“TRACS”). This Rule 5400 Series establishes the rules for determining which member must report a trade and whether a trade must be reported to the Nasdaq Market Center, pursuant to the Rule 4630, 4640, 4650 and 6100 Series or TRACS, pursuant to the Rule 4630A and 6100A Series.

(b)No change. 6110. Definitions

(a)The term “Reportable Security” shall mean all Nasdaq [National] *Global* Market and Nasdaq Capital Market securities, all Consolidated Quotation Service

(CQS)securities traded in the over-the-counter market, all OTC Equity Securities as defined in Rule 6600, and all Direct Participation Programs as defined in Rule 6910. (b)-(q) No change. 6120. Trade Reporting Participation Requirements

(a)Mandatory Participation for Clearing Agency Members (1)-(5) No change.

(6)Upon compliance with the conditions specified in subparagraphs (A)-(E) below, access to and participation in the trade reporting service of the Nasdaq Market Center may be granted to a national securities exchange that trades Nasdaq [National] *Global* Market or Capital Market securities on an unlisted trading privileges basis (“UTP Exchange”). The terms and conditions of such access and participation, including available functionality and applicable rules and fees, shall be set forth in and governed by a UTP Exchange ACT Participant Application Agreement. Such access may be made available on terms that differ from the terms applicable to members but that do not unreasonably discriminate among national securities exchanges. (A)-(E) No change.

(7)No change

(b)No change. IM-6130. Trade Reporting of Short Sales The NASD's short sale rule (Short Sale Rule or Rule 3350) generally prohibits members from effecting short sales in [NNM] *NGM* securities at or below the inside bid when the current inside bid is below the previous inside bid. Rule 6130(d)(6) requires that members indicate on ACT reports whether a transaction is a short sale or a short sale exempt transaction (“ACT short sale reporting requirements”). Rule 6130 explicitly requires members to file ACT reports not just for [NNM] *NGM* securities transactions, but for other securities transactions, including transactions in exchange-listed, Capital Market, convertible debt, OTC Bulletin Board, and OTC equity securities. Thus, all short sale transactions in these securities reported to ACT must carry a “short sale” indicator (or a “short sale exempt” indicator if it is a short sale transaction in an [NNM] *NGM* or exchange-listed security that qualifies for an exemption from Rule 3350 or SEC Rule 10a-1). 6150. Risk Management Functions

(a)No change.

(b)If a clearing broker voluntarily uses the Nasdaq Market Center risk management service, the Nasdaq Market Center system will provide the following risk management capabilities to clearing brokers that have executed an ACT Participant Risk Management Agreement:

(1)No change.

(2)Gross Dollar Thresholds (“Super Caps”) and Sizeable Limits. Clearing brokers will be able to establish, on an inter-day or intra-day basis, gross dollar thresholds (also known as “Super Caps”) for purchases and sales for their correspondent executing brokers. When any of a correspondent's gross dollar thresholds are exceeded, notice will be furnished to the clearing broker, and any trade in excess of an applicable “sizeable limit” that is negotiated by the correspondent will be subject to review by the clearing broker until such time as the correspondent's trading activity no longer exceeds a gross dollar threshold. Specifically, the clearing broker will have 15 minutes from execution to review any single trade negotiated by the correspondent that equals or exceeds the applicable sizeable limit in order to decide to act as principal for the trade or to decline to act as principal. If the clearing broker does not affirmatively accept or decline the “sizeable trade,” at the end of 15 minutes the system will act in accordance with pre-established processing criteria, as described below.

(A)ACT Workstation Users.

(i)Clearing brokers that use the ACT Workstation may establish gross dollar thresholds and sizeable limits for each of their correspondent executing brokers. They may establish different gross dollar thresholds and sizeable limits for each type of security (i.e., Nasdaq [National] *Global* Market, Nasdaq Capital Market, Consolidated Quotations Service, or OTC Bulletin Board), as well as an aggregate gross dollar threshold and sizeable limit for all types of securities. (ii)-(iii) No change.

(B)Other Nasdaq Market Center Risk Management Users.

(i)Clearing brokers that do not use the ACT Workstation may establish aggregate gross dollar thresholds for each of their correspondent executing brokers, but may not establish gross dollar thresholds for each type of security (i.e., Nasdaq [National] *Global* Market, Nasdaq Capital Market, Consolidated Quotations Service, or OTC Bulletin Board). (ii)-(iii) No change. (3)-(5) No change.

(6)Single Trade Limit. Clearing brokers will have 15 minutes from trade report input to the Nasdaq Market Center to review any single trade executed by their correspondent executing brokers that equals or exceeds a pre-established limit in order to decide to act as principal for the trade or to decline to act as principal. If, however, the clearing firm does not affirmatively accept or decline the trade, at the end of 15 minutes the system will act in accordance with pre-established processing criteria, as described below.

(A)ACT Workstation Users. Clearing brokers that use the ACT Workstation may establish single trade limits for each of their correspondent executing brokers, and may establish different limits for each type of security (i.e., Nasdaq [National] *Global* Market, Nasdaq Capital Market, Consolidated Quotations Service, or OTC Bulletin Board). Such clearing brokers may also establish the default processing criteria that will apply to trades that exceed the single trade limit after 15 minutes if the clearing broker does not affirmatively accept or decline the trade; the clearing broker may specify that such trades should be either automatically declined or automatically subjected to normal processing in which the clearing broker will act as principal to clear the trades.

(B)No change. 6110A. Definitions (a)-(k) No change.

(l)The term “TRACS Eligible Security” shall mean Nasdaq [National] Global Market, Nasdaq Capital Market security and Nasdaq Convertible Debt securities. (m)-(n) No change. 7010. System Services (a)-(f) No change.

(g)Nasdaq Market Center Trade Reporting The following charges shall be paid by the participant for use of the trade reporting service of the Nasdaq Market Center: Transaction Related Charges: Reporting of transactions in Nasdaq [National] *Global* Market and Capital Market securities executed through the Nasdaq Market Center System (“Nasdaq Market Center Covered Transactions”) Average daily volume of transaction reports for the Nasdaq Market Center Covered Transactions during the month to which a participant is a party: Fee per side for transaction reports of the Nasdaq Market Center Covered Transactions to which such participant is a party: 0 to 9,999 $0.029 10,000 or more $0.00 Other reports for transactions in Nasdaq [National] *Global* Market and Capital Market securities not subject to comparison through the Nasdaq Market Center $0.00 Reporting of transactions in ITS Securities (as defined in Rule 5210(c)) not subject to comparison through the Nasdaq Market Center (“ITS Covered Transactions”) Average daily volume of media transaction reports for ITS Covered Transactions during the month

(i)that are submitted to the trade reporting service of the Nasdaq Market Center automatically and in which a participant is identified as the reporting party, or

(ii)that are submitted or introduced by such participant to the Nasdaq Market Center: Fee per side for reports of ITS Covered Transactions to which such participant is a party: 0 to 5,000 $0.029 More than 5,000 $0.029 for a number of reports equal to 5,000 times the number of trading days in the month $0.00 for all remaining reports. Reporting of all other transactions not subject to comparison through the Nasdaq Market Center $0.029/side. Comparison $0.0144/side per 100 shares (minimum 400 shares; maximum 7,500 shares). Late Report—T+N $0.288/side. Query $0.50/query. CTCI fee $575.00/month. WebLink ACT or Nasdaq Workstation Post Trade $300.00/month (full functionality) or $150.00/month (up to an average of twenty transactions per day each month) (For the purposes of this service only, a transaction is defined as an original trade entry, either on trade date or as-of transactions per month). Risk Management Charges $40.035/side and $17.25/month per correspondent firm (maximum $10,000/month per correspondent firm). Corrective Transaction Charge $0.25/Cancel, Error, Inhibit, Kill, or `No' portion of No/Was transaction, paid by reporting side; $0.25/Break, Decline transaction, paid by each party. ACT Workstation $525/logon/month. (h)-(t) No change.

(u)Nasdaq Revenue Sharing Program. After Nasdaq earns total operating revenue sufficient to offset actual expenses and working capital needs, a percentage of all Market Participant Operating Revenue (“MPOR”) shall be eligible for sharing with Nasdaq Quoting Market Participants (as defined in Rule 4701). MPOR is defined as operating revenue that is generated by Nasdaq Quoting Market Participants. MPOR consists of transaction fees, technology fees, and market data revenue that is attributable to Nasdaq Quoting Market Participant activity in Nasdaq [National] *Global* Market and Capital Market securities. MPOR shall not include any investment income or regulatory monies. The sharing of MPOR shall be based on each Nasdaq Quoting Market Participant's pro rata contribution to MPOR. In no event shall the amount of revenue shared with Nasdaq Quoting Market Participants exceed MPOR. To the extent market data revenue is subject to year-end adjustment, MPOR revenue may be adjusted accordingly. (v)-(w) No change. 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 proposes to rename the Nasdaq National Market as the Nasdaq Global Market to more accurately reflect the international reach and leadership of many of the companies listed on that market and the market itself. 9 9 The Nasdaq Global Market, including the Nasdaq Global Select segment described below, would be the successor to the Nasdaq National Market. As such, Nasdaq believes that all securities listed on the Nasdaq Global Market, including those on the Nasdaq Global Select Market, would be “covered securities,” as that term is defined in Section 18(b) of the Securities Act of 1933, 15 U.S.C. 77r(b). Nasdaq also proposes to create a new segment within the Nasdaq Global Market. This new segment would be known as the Nasdaq Global Select Market, and new, higher initial listing requirements would apply to companies listing onthe Nasdaq Global Select Market. 10 All listing and trading rules applicable to securities on the Nasdaq Global Market would also apply to the Nasdaq Global Select Market. 10 As described below, given that the Nasdaq Global Select Market is a segment of the Nasdaq Global Market, Nasdaq would apply the same continued listing requirements as are applicable to other companies on the Nasdaq Global Market, which are the existing listing requirements for the Nasdaq National Market. Listing Standards As described below, issuers would be required to meet minimum liquidity measures and a financial test, as well as achieve a minimum bid price requirement. 11 Nasdaq believes that the creation of this segment would more clearly align Nasdaq's financial and liquidity listing standards with its corporate governance standards 12 and its regulatory enforcement program, as well as its trading system. While Nasdaq believes its existing standards protect investors, Nasdaq also believes that, to the extent these higher initial listing standards help attract and maintain listings on Nasdaq and identify companies that meet these high listing standards, investors would benefit. 11 Nasdaq could deny listing to a company that meets these requirements based on public interest concerns, as described in existing NASD Rule 4300 and NASD IM-4300. 12 Companies on the Nasdaq Global Select Market would be required to meet the same rigorous corporate governance standards applicable to companies on the Nasdaq Capital and Nasdaq Global Markets. These standards require a majority independent board, an independent audit committee, and for independent directors to participate in compensation and nomination decisions. Shareholders are also required to approve significant transactions and the use of equity compensation. 1. Liquidity Tests In order to qualify for the Nasdaq Global Select Market, a company would be required to demonstrate either:

(1)A minimum of 550 shareholders and an average monthly trading volume over the prior 12 months of at least 1,100,000 shares per month; or

(2)A minimum of 2,200 shareholders. Average monthly trading volume > = 1,100,000 and Shareholders > = 550 OR Shareholders > = 2,200 In addition, a company must have at least 1,250,000 publicly held shares. In computing the number of publicly held shares, Nasdaq would not consider shares held by an officer, director, or 10% shareholder ofthe company. Publicly Held Shares > = 1,250,000 Finally, those publicly held shares must have a market value of at least $110 million; provided, however, that if the market value of publicly held shares is at least $100 million and the company has shareholders equity of at least $110 million the company would also qualify. Market Value of Publicly Held Shares > = $110,000,000 OR Market Value of Publicly Held Shares > = $100,000,000 and Shareholders' Equity > = $110,000,000 2. Financial Tests A company would also be required to meet one of three financial tests in order to qualify for listing on the Nasdaq Global Select Market. Specifically, companies would be required to demonstrate:

(1)Aggregate pre-tax earnings of at least $11 million over the prior three years, with all three years having positive pre-tax earnings and the two most recent years having at least $2.2 million pre-tax earnings each;

(2)aggregate cash flows of at least $27.5 million over the prior three years with all three years having positive cash flows, an average market capitalization of at least $550 million over the prior 12 months, and total revenue of at least $110 million in the previous fiscal year; or

(3)total revenue of at least $90 million in the previous fiscal year and an average market capitalization of at least $850 million over the prior 12 months. However, the operating history requirements in NASD Rules 4426(c)(1) and (c)(2) may be shortened to a lesser period if an issuer does not have three years of publicly reported financial data. 13 13 A period of less than three months shall not be considered a fiscal year. *See* NASD Rule 4427(f). Three year aggregate pretax earnings; and > = $11,000,000 Pre-tex earings in the two most recent years each; and > = $2,200,000 Third most recent year pre-tax earnings > 0 OR Three year aggregate cash flows; and > = $27,500,000 Three most recent years' cash flow each; and > 0 Average 12 month market capitalization; and > = $550,000,000 Total revenue > = $110,000,000 OR Total revenue; and > = $90,000,000 Average 12 month market capitalization > = $850,000,000 Nasdaq would determine compliance with the financial tests based on a company's publicly filed financial information. Thus, for example, as specified in proposed NASD Rule 4427(b), pre-tax earnings would be the company's pre-tax income from continuing operations as filed with the Commission in the issuer's most recent periodic report and/or registration statement. 3. Price Test Any company newly listed on Nasdaq (both initial public offerings and seasoned companies) would be required to have a minimum $5 bid price to list on the Nasdaq Global Select Market. Companies switching from the Nasdaq Global Market would have previously satisfied the bid price requirement in connection with their initial listing and therefore would not be required to meet this requirement again when transferring to the new segment. 4. Other Provisions A company listing in connection with a court-approved reorganization under the federal bankruptcy laws or comparable foreign laws would be required to have 450 shareholders for listing, as would a company affiliated with another company listed on the Nasdaq Global Select Market. In these cases, Nasdaq believes that while the shareholder requirement is difficult to meet immediately upon listing because the stock is not initially widely distributed, shares are widely distributed following the initial listing. For similar reasons, the market value of publicly held shares requirement would be $70 million in the case of a company listing in connection with its initial public offering, a company that is affiliated with, or a spin-off from, another company listed on the Nasdaq Global Select Market, and a closed-end management investment company. Due to their unique nature, closed-end management investment companies would not be required to meet the financial requirements described above. 14 Further, Nasdaq has proposed different liquidity standards for closed-end funds. Finally, if the primary class of a company is included in the Nasdaq Global Select Market, any secondary class of that same company, such as a secondary class of common or a preferred stock, that qualifies for listing on the Nasdaq Global Market shall also be included in the Nasdaq Global Select Market. 14 While Nasdaq plans to list closed-end funds on the Nasdaq Global Select Market, there are not separate listing standards for structured products, index-linked notes, trust issued receipts, SEEDs, units, commodity-backed products, or Exchange Traded Funds. 5. Continued Listing Following initial listing on the Nasdaq Global Select Market, securities would be subject to the continued listing standards that are currently applicable to the Nasdaq Global Market. Thus, companies must satisfy one of the alternatives for continued listing contained in NASD Rule 4450. 15 15 For inclusion on the Nasdaq Global Select Market, an initial public offering must be able to satisfy one of the alternatives for continued listing on the Nasdaq Global Market as contained in NASD Rule 4450, as well as the requirements for initial inclusion on the Nasdaq Global Select Market. As a result, the initial listing standards would, in all cases, exceed the criteria set forth in Rule 3a51-1(a)(2) of the Act, 17 CFR 240.3a51-1(a)(2). Implementation Prior to the planned July 1, 2006, launch of the new segment, Nasdaq would review all companies' qualifications and assign qualified Nasdaq Global Market companies to the new Nasdaq Global Select segment. 16 In addition, qualified Nasdaq Capital Market companies would be given the opportunity to be included in the new segment. 17 Thereafter, beginning in 2007, staff of the Nasdaq Listing Qualifications Department would review all Nasdaq Global Market companies' qualifications each October and qualified Nasdaq Global Market companies would be automatically placed in the new segment the following January. 18 While this review would occur automatically in October, a company may also apply to upgrade at any point. Companies transferring from the Nasdaq Global Market to the Nasdaq Global Select Market as part of this process would not be assessed entry or application fees. New Nasdaq Global Market listings would also be placed in the Nasdaq Global Select segment if they qualify, although they would be subject to the applicable entry and application fee schedule. 16 As a result of this review, no company then on the Nasdaq Global Market would be adversely affected. Note that the fees for the Nasdaq Global Market and the Nasdaq Global Select Market would be the same. *See* NASD Rule 4510. Fees for securities listed on the Nasdaq Capital Market would continue to differ. *See* NASD Rule 4520. Any company not qualifying for the Nasdaq Global Select Market would remain on the Nasdaq Global Market. 17 *See* NASD Rule 4425(d). 18 Nasdaq believes that the delay from October to January is necessary to assure adequate time to complete the required review and notify issuers and market participants about the change. Nonetheless, to assure that no company is disadvantaged by this delay, a company that qualifies for the Nasdaq Global Select Market when it is reviewed in October would be placed in that segment even if it falls below one or more of the initial listing requirements in January when the actual transfer takes place. However, a company that no longer meets the continued listing requirements for the Nasdaq Global Market in January would not be transferred to the Nasdaq Global Select Market, nor would a company that is delinquent in filing its periodic reports at the time of the transfer or where staff has raised public interest concerns. As part of both the initial transfer of companies to the Nasdaq Global Select Market and Nasdaq's ongoing review of companies' eligibility to be included in the Nasdaq Global Select Market, a company that is in a grace or compliance period with respect to a qualitative listing standard, such as the cure period allowed to companies that have a vacancy on their audit committee, would be allowed to transfer to the Nasdaq Global Select Market, subject to the continuation of that grace period. If a company is non-compliant with a qualitative listing requirement 19 that does not provide for a grace period or if staff has raised a public interest concern, the company would not be permitted to transfer to the Nasdaq Global Select Market until the underlying deficiency is resolved. A company that is below a quantitative listing requirement even if the company has not been below the requirement for a sufficient period of time to be considered deficient 20 and a company in a grace or compliance period with respect to a quantitative listing requirement would not be allowed to transfer to the Nasdaq Global Select Market until the underlying deficiency is resolved, nor would any company before a Nasdaq Listing Qualifications Panel. 19 Qualitative listing requirements include those requirements contained in NASD Rule 4350. 20 For example, a security with a closing bid price below $1 is not considered deficient until the security has closed below $1 for 30 consecutive business days. Nonetheless, no security with a closing bid price below $1 would be permitted to list on the Nasdaq Global Select Market, even if it has closed above $1 in the prior 30 business days. In connection with the initial transfer of companies to the Nasdaq Global Select Market, Nasdaq proposes to allow (but not require) any Nasdaq-listed company that meets the New York Stock Exchange LLC (“NYSE”) initial listing standards as of July 1, 2006, but that does not then qualify for the new segment, to be included in the Nasdaq Global Select Market, subject to an 18 month grace period until January 1, 2008, to achieve compliance. 21 During that grace period, these companies would have to achieve compliance with all applicable criteria for initial listing on the Nasdaq Global Select Market. Any company that has not achieved compliance with all listing criteria for the Nasdaq Global Select Market by January 2008 would be moved to the Nasdaq Global Market at that time. 22 21 Certain companies would qualify for the NYSE but not the Nasdaq Global Select Market. 22 If any such company fails to meet the continued listing standards for the Nasdaq Global Market at any point, staff would begin proceedings under the NASD Rule 4800 Series with respect to that company. 2. Statutory Basis Nasdaq believes that the proposed rule change, as amended, is consistent with the provisions of Section 15A of the Act, 23 in general, and with Section 15A(b)(6) of the Act, 24 in particular. Section 15A(b)(6) of the Act requires that Nasdaq's rule be designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market, and to protect investors and the public interest. Nasdaq believes that changing the name of the Nasdaq National Market to the Nasdaq Global Market would more accurately reflect the international reach and leadership of many of the companies listed on that market and the market itself. Further, Nasdaq believes that the creation of a market segment within the Nasdaq Global Market with what it describes as higher initial listing standards would protect investors and the public interest, and would foster competition among exchange markets. 23 15 U.S.C. 78 *o* -3. 24 15 U.S.C. 78 *o* -3(b)(6). B. Self-Regulatory Organization's Statement on Burden on Competition Nasdaq does not believe that the proposed rule change, as amended, would result in any 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 Written comments 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, as amended, 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 the public interest, it has become effective pursuant to Section 19(b)(3)(A) of the Act 25 and Rule 19b-4(f)(6) thereunder. 26 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. 27 25 15 U.S.C. 78s(b)(3)(A). 26 17 CFR 240.19b-4(f)(6). 27 For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on June 27, 2006, the date Nasdaq filed Amendment No. 4 to the proposed rule change. *See* 15 U.S.C. 78s(b)(3)(C). Nasdaq has requested that the Commission waive the 5-day pre-filing notice requirement and the 30-day operative delay and allow the proposed rule change, as amended, to become effective upon filing. The Commission has waived the 5-day pre-filing requirement for this proposal. In addition, the Commission believes that it is consistent with the protection of investors and the public interest to waive the 30-day operative delay. 28 The Commission notes that the proposed rule change, as amended, is substantially similar to a proposed rule change filed by the NASDAQ Stock Market LLC. 29 28 For 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). 29 *See* Securities Exchange Act Release No. 53799 (May 12, 2006), 71 FR 29195 (May 19, 2006) (SR-NASDAQ-2006-007). 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-2006-068 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-2006-068. 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. 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-2006-068 and should be submitted on or before July 31, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 30 30 17 CFR 200.30-3(a)(12). J. Lynn Taylor, Assistant Secretary. [FR Doc. 06-6038 Filed 7-7-06; 8:45 am]

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