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Home > > ISE General 2
General 2 Organization and Administration
Section 1. Divisions of the Exchange

The divisions of the Exchange shall include the Regulatory Division and such other Divisions as the Chief Executive Officer, with the approval of the Board, may establish. The Chief Executive Officer shall appoint a head of every Division and may designate departments within each Division.

Adopted June 6, 2019 (SR-ISE-2019-17).

Section 2. Fees, Dues and Other Charges

(a) Access Fees. The access fees payable by Members shall be fixed from time to time by the Board. Access fees shall be payable in full on a monthly basis.

(b) Transaction Fees. Members shall pay a fee for each transaction they execute on the Exchange, as may be determined by the Board.

(c) Communication Fees. The Board may, at its discretion, impose a communication fee for quotes entered on the Exchange in addition to the fee contained in General 2, Section 2(b).

(d) Regulatory Fees or Charges. In addition to the dues and charges specified in this General 2, the Board may, from time to time, fix and impose other fees, assessments or charges to be paid to the Exchange by Members or by Classes of Members with respect to applications, registrations, approvals, use of Exchange facilities, or other services or privileges granted, including but not limited to the following:

(1) Regulatory Oversight Service Fees. Members that are subject to Rule 15c3-3 under the Exchange Act (the "Net Capital Rule") and for which the Exchange has been assigned as the designated examining authority ("DEA") pursuant to Rule 17d-1 under the Exchange Act shall be required to pay a fee to be determined by the Board.

(2) Members, whether or not they are members of another registered national securities exchange or securities association with which the Exchange has executed an agreement under Rule 17d-2 under the Exchange Act to allocate responsibility for examining Members for compliance with and enforcement of certain regulatory requirements, shall be required to pay a fee to be determined by the Board.

(3) Registration Fees. Members shall pay application, maintenance and transfer registration fees for their Registered Options Principals ("ROPs") as described in Options 10, Section 2 and General 4, Section 1.1220(a) and Registered Representatives ("RRs") as described in Options 10, Section 2 and General 4, Section 1.1220(b).

Adopted June 6, 2019 (SR-ISE-2019-17).

(a) Any Member or person associated with a Member who fails to prevail in a lawsuit or other legal proceeding instituted by such person against the Exchange or any of its Directors, officers, committee members, employees or agents, and related to the business of the Exchange, shall pay to the Exchange all reasonable expenses, including attorneys' fees, incurred by the Exchange in the defense of such proceeding, but only in the event that such expenses exceed fifty thousand dollars ($50,000).

(b) Paragraph (a) of this Rule shall not apply to disciplinary actions by the Exchange, to administrative appeals of Exchange actions or in any specific instance where the Board has granted a waiver of this provision.

Adopted June 6, 2019 (SR-ISE-2019-17).

Section 4. Limitation on Affiliation between the Exchange and Members

(a) Without prior SEC approval, the Exchange, or any facility of the Exchange, or any entity with which the Exchange or any facility of the Exchange is affiliated shall not, directly or indirectly through one or more intermediaries, acquire or maintain an ownership interest in a Member or non-Member owner. In addition, a Member or non-Member owner shall not be or become an affiliate of the Exchange, or any facility of the Exchange, or any entity with which the Exchange or any facility of the Exchange is affiliated. In addition, no Member or person associated with a Member shall be the beneficial owner, directly or indirectly, of greater than twenty percent (20%) of the (i) then-outstanding voting Limited Liability Company Interest of the Exchange, or (ii) then-outstanding voting securities of Nasdaq, Inc.

(b) Nothing in this Rule shall prohibit any Member from being or becoming an affiliate of the Exchange, or any facility of the Exchange, or an affiliate of any affiliate of the Exchange or any facility of the Exchange solely by reason of any officer, director or partner of such Member being or becoming a Member Representative Director (as defined in the By-Laws) pursuant to the By-Laws. For purposes of this Rule, any calculation of the voting Limited Liability Company Interest of the Exchange or the voting securities of Nasdaq, Inc. outstanding at any particular time shall be made in accordance with the last sentence of SEC Rule 13d-3(d)(1)(i)(D). The term "beneficially owned", including all derivative or similar words, shall have the meaning set forth in the Amended and Restated Certificate of Incorporation of Nasdaq, Inc.

(c) Nasdaq, Inc., which owns NASDAQ Execution Services, LLC and the Exchange, shall establish and maintain procedures and internal controls reasonably designed to ensure that NASDAQ Execution Services, LLC does not develop or implement changes to its System on the basis of non-public information regarding planned changes to the Exchange's Systems, obtained as a result of its affiliation with the Exchange, until such information is available generally to similarly situated Exchange Members in connection with the provision of inbound routing to the Exchange.

Adopted June 6, 2019 (SR-ISE-2019-17).

Section 5-10 Reserved

Adopted June 9, 2021 (SR-ISE-2021-14).

Section 11. Organization and Administration

(a) Each Member shall report to the Exchange all contact information required by the Exchange via the FINRA Contact system.

(b) Each Member shall update its required contact information promptly, but in any event not later than 30 days following any change in such information. In addition, each Member shall review and, if necessary, update its required contact information, via such means as the Exchange may specify, within 17 business days after the end of each calendar year.

(c) Each Member shall comply with any Exchange request for such information promptly, but in any event not later than 15 days following the request, or such longer period that may be agreed to by Exchange staff.

Adopted December 29, 2020 (SR-ISE-2020-43), operative January 29, 2021.

Section 12. Business Continuity and Disaster Recovery Plan Testing Requirements for Members Pursuant to Regulation SCI

With respect to the Exchange's business continuity and disaster recovery plans, including its backup systems, the Exchange shall:

(a) Establish standards for the designation of those Members that the Exchange reasonably determines are, taken as a whole, the minimum necessary for the maintenance of fair and orderly markets in the event of the activation of such plans. Such standards may include volume-based and/or market share-based criteria, and may be adjusted from time to time by the Exchange. The Exchange will provide public notice of the standards.

(b) Designate Members pursuant to the standards established in paragraph (a) of this Rule and require participation by such designated Members in scheduled functional and performance testing of the operation of such plans, in the manner and frequency specified by the Exchange, provided that such frequency shall not be less than once every 12 months. The Exchange will provide at least six months prior notice to Members that are designated for mandatory testing, and participation of such Members is a condition of membership.

Adopted June 9, 2021 (SR-ISE-2021-14).

Sections 13-24 Reserved

Adopted June 9, 2021 (SR-ISE-2021-14); amended Aug. 18, 2022 (SR-ISE-2022-17), operative Sep. 17, 2022.

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