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NDAQ » Topics » Director Classifications

This excerpt taken from the NDAQ DEF 14A filed Apr 3, 2009.

Director Classifications

In accordance with SEC requirements to ensure that balanced viewpoints are represented on our board of directors, NASDAQ OMX’s by-laws require that all directors be classified as:

 

  •  

Industry Directors;

 

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  •  

Non-Industry Directors, which are further classified as either Public Directors or Issuer Representatives; or

 

  •  

Staff Directors.

The number of Non-Industry Directors, including at least one Public Director and at least one Issuer Representative of a listed company, is required to equal or exceed the number of Industry Directors, unless the NASDAQ OMX board consists of ten or more directors. In that case, at least two directors must be Issuer Representatives. We establish the classification of each director based on a questionnaire with specific questions relating to the classifications. NASDAQ OMX’s corporate secretary annually certifies to the board of directors the classification of each director.

The following is a general description of NASDAQ OMX’s director classifications:

 

  •  

Industry Director means a director who is not a Staff Director and who (i) is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer; (ii) is an officer, director (excluding an outside director) or employee of an entity that owns more than 10% of the equity of a broker or dealer, and the broker or dealer accounts for more than 5% of the gross revenues received by the consolidated entity; (iii) owns more than 5% of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed 10% of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer; (iv) provides professional services to brokers or dealers, and such services constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues received by the director’s firm or partnership; (v) provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50% or more of the voting stock of a broker or dealer, and such services relate to the director’s, officer’s or employee’s professional capacity and constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues received by the director’s firm or partnership; or (vi) has a consulting or employment relationship with, or provides professional services to, NASDAQ OMX or its affiliates or the Financial Industry Regulatory Authority (FINRA), or any predecessor, or has had any such relationship or provided such services at any time within the prior three years;

 

  •  

Non-Industry Director means a director who is not a NASDAQ OMX employee and who is (i) a Public Director; (ii) an Issuer Representative; or (iii) any other individual who would not be an Industry Director;

 

  •  

Public Director means a director who has no material business relationship with a broker or dealer, NASDAQ OMX or its affiliates or FINRA;

 

  •  

Issuer Representative means a director who is a director, officer or employee of an issuer of securities listed on The NASDAQ Stock Market; and

 

  •  

Staff Director means a director who is also an officer of NASDAQ OMX.

This excerpt taken from the NDAQ DEF 14A filed Apr 17, 2008.

Director Classifications

In accordance with U.S. Securities and Exchange Commission (SEC) requirements to ensure that balanced viewpoints are represented on our board of directors, NASDAQ OMX’s by-laws require that all directors be classified as:

 

  •  

Industry Directors;

 

  •  

Non-Industry Directors, which are further classified as Public Directors and Issuer Representatives; or

 

  •  

Staff Directors.

The number of Non-Industry Directors, including at least one Public Director and at least one Issuer Representative of a listed company, is required to equal or exceed the number of Industry Directors, unless the NASDAQ OMX board consists of ten or more directors. In that case, at least two directors must be Issuer Representatives. We establish the classification of each director based on a questionnaire with specific questions related to the classifications. NASDAQ OMX’s corporate secretary annually certifies to the board of directors the classification of each director.

The following is a general description of NASDAQ OMX’s director classifications:

 

  •  

Industry Director means a director who is not a Staff Director who (i) is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer; (ii) is an officer, director (excluding an outside director) or employee of an entity that owns more than 10% of the equity of a broker or dealer, and the broker or dealer accounts for more than 5% of the gross revenues received by the consolidated entity; (iii) owns more than 5% of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed 10% of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer; (iv) provides professional services to brokers or dealers, and such services constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues received by the director’s firm or partnership; (v) provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50% or more of the voting stock of a broker or dealer, and such services relate to the director’s, officer’s or employee’s professional capacity and constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues received by the director’s firm or partnership; or (vi) has a consulting or employment relationship with, or provides professional services to, NASDAQ OMX or its affiliates or the Financial Industry Regulatory Authority (FINRA, which was formerly known as National Association of Securities Dealers, or NASD), or any predecessor, or has had any such relationship or provided such services at any time within the prior three years;

 

  •  

Non-Industry Director means a director who is not a NASDAQ OMX employee and who is (i) a Public Director; (ii) an Issuer Representative; or (iii) any other individual who would not be an Industry Director;

 

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  •  

Public Director means a director who has no material business relationship with a broker or dealer, NASDAQ OMX or its affiliates or FINRA;

 

  •  

Issuer Representative means a director who is an officer or employee of an issuer of securities listed on The NASDAQ Stock Market; and

 

  •  

Staff Director means a director who is also an officer of NASDAQ OMX.

This excerpt taken from the NDAQ DEF 14A filed Apr 20, 2007.

Director Classifications

In accordance with SEC requirements to ensure that balanced viewpoints are represented on our board of directors, Nasdaq’s by-laws require that all directors be classified as:

 

  •  

Industry Directors;

 

  •  

Non-Industry Directors, which are further classified as Public Directors and Issuer Representatives; or

 

  •  

Staff Directors (limit of two).

The number of Non-Industry Directors, including at least one Public Director and at least one Issuer Representative of a Nasdaq-listed company, is required to equal or exceed the number of Industry Directors, unless the Nasdaq board consists of ten or more directors. In that case, at least two directors must be Issuer Representatives. We establish the classification of each director based on a questionnaire with specific questions related to the classifications. Nasdaq’s corporate secretary annually certifies to the board of directors the classification of each director.

The following is a general description of Nasdaq’s director classifications:

 

  •  

Industry Director means a director who is not a Staff Director who (i) is or has served in the prior three years as an officer, director, or employee of a broker or dealer, excluding an outside director or a director not engaged in the day-to-day management of a broker or dealer; (ii) is an officer, director (excluding an outside director) or employee of an entity that owns more than 10% of the equity of a broker or dealer, and the broker or dealer accounts for more than 5% of the gross revenues received by the consolidated entity; (iii) owns more than 5% of the equity securities of any broker or dealer, whose investments in brokers or dealers exceed 10% of his or her net worth, or whose ownership interest otherwise permits him or her to be engaged in the day-to-day management of a broker or dealer; (iv) provides professional services to brokers or dealers, and such services constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues received by the director’s firm or partnership; (v) provides professional services to a director, officer, or employee of a broker, dealer, or corporation that owns 50% or more of the voting stock of a broker or dealer, and such services relate to the director’s, officer’s or employee’s professional capacity and constitute 20% or more of the professional revenues received by the director or 20% or more of the gross revenues

 

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received by the director’s firm or partnership; or (vi) has a consulting or employment relationship with, or provides professional services to, Nasdaq or its affiliates or National Association of Securities Dealers, Inc. (NASD), or any predecessor, or has had any such relationship or provided such services at any time within the prior three years;

 

  •  

Non-Industry Director means a director who is not a Nasdaq employee and who is (i) a Public Director; (ii) an Issuer Representative; or (iii) any other individual who would not be an Industry Director;

 

  •  

Public Director means a director who has no material business relationship with a broker or dealer, Nasdaq or its affiliates or NASD;

 

  •  

Industry Representative means a director who is an officer or employee of an issuer of securities listed on The Nasdaq Stock Market; and

 

  •  

Staff Director means a director who is also an officer of Nasdaq.

EXCERPTS ON THIS PAGE:

DEF 14A
Apr 3, 2009
DEF 14A
Apr 17, 2008
DEF 14A
Apr 20, 2007

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