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Frequently Asked Questions
  Staff Interpretation Letter 2002-5
Identification Number 970
Rule 4351:  Voting rights of existing shareholders of publicly traded common stock registered under Section 12 of the Act cannot be disparately reduced or restricted through any corporate action or issuance.   Examples of such corporate action or issuance include, but are not limited to, the adoption of time-phased voting plans, the adoption of capped voting rights plans, the issuance of super-voting stock, or the issuance of stock with voting rights less than the per share voting rights of the existing common stock through an exchange offer.
 
IM-4351.  Voting Rights Policy:  NASDAQ will accept any action or issuance relating to the voting rights structure of a non-U.S. issuer that is in compliance with The NASDAQ Stock Market's requirements for domestic companies or that is not prohibited by the issuer's home country law.
 
Relevant Facts:  A non-U.S. company proposed to enter into a transaction, pursuant to which certain investors would be granted preemptive rights, director nomination rights, board committee appointment rights, and approval rights that could be prohibited by Listing Rule 4351.  The company submitted a letter from its legal counsel in its home country stating that the proposed rights were not prohibited under the laws of that country.
 
Issue:  Are the proposed voting and director nomination rights consistent with Listing Rule 4351 and IM-4351?
 
Determination:  Based on the letter from the company’s counsel, NASDAQ concluded that the proposed rights were consistent with Listing Rule 4351 and IM-4351 because IM-4351 states that: “NASDAQ will accept any action or issuance relating to the voting rights structure of a non-U.S. issuer that is in compliance with The NASDAQ Stock Market’s requirements for domestic companies or that is not prohibited by the issuer’s home country law”, and the proposed rights were not prohibited under the company’s home country law
Publication Date*: 7/31/2012 Mailto Link Identification Number: 970
material_search_footer*The Publication Date reflects the date of first inclusion in the Reference Library, which was launched on July 31, 2012, or a subsequent update to the material. Material may have been previously available on a different Nasdaq web site.
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