By Cydney Posner

Nasdaq has filed with the SEC a proposed rule change that will require, rather than recommend, that Nasdaq-listed companies provide Nasdaq with at least ten minutes notification prior to public announcement of material information, if the information involves any of the events set forth in IM-5250-1. (This information involves, in essence, material information that would reasonably be expected to affect the value of the securities or influence investors' decisions, such as material senior management changes, acquisitions or any event requiring that an 8-K be filed.) Prior notice to the MarketWatch Department must be made through the electronic disclosure submission system available at www.nasdaq.net, except in emergency situations. Examples of an emergency situation include lack of computer or Internet access, technical problems on either the company or Nasdaq system or an incompatibility between those systems, and a material development where no draft disclosure document exists, but immediate notification to MarketWatch is important based on nature of the material event. Companies that repeatedly fail to provide timely notice or repeatedly fail to use the electronic disclosure submission system when Nasdaq finds no emergency situation existed may be subject to reprimand or even delisting.

The proposed rule change will also modify language inconsistent with recent SEC guidance on the use of company websites to satisfy public disclosure requirements under Reg FD. This guidance provided that posting of information on a company website could be considered a sufficient method of public disclosure under Reg FD under certain relatively narrow circumstances. Accordingly, the proposed rule change provides that posting of information on the company's website may not be (as opposed to is not) by itself an adequate method of public disclosure under Reg FD and SEC guidance and releases, and as a result, under Nasdaq rules.

This change, which is immediately effective, will become operative on November 30, 2009.

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