ISTO Auctions, as described above.\168\
---------------------------------------------------------------------------

    \165\ See proposed Rule 25040(c)(1). Orders marked IOC submitted
during the Quote-Only Period would be rejected.
    \166\ See proposed Rule 25040(c)(2). The Quote-Only Period shall
be extended for an additional five (5) minutes should a Halt Auction
be unable to be performed due to the absence of a TOP (``Initial
Extension Period''). After the Initial Extension Period, the
Exchange proposes that the Quote-Only Period shall be extended for
additional five (5) minute periods should a Halt Auction be unable
to be performed due to absence of a TOP (``Additional Extension
Period'') until a Halt Auction occurs. Under the proposed Rule, the
Exchange shall attempt to conduct a Halt Auction during the course
of each Additional Extension Period. Id.
    \167\ See proposed Rule 25040(c)(3)-(5).
    \168\ Id.
---------------------------------------------------------------------------

    The Exchange also proposes to adopt certain contingency procedures
in proposed Rule 25040(d) that would provide that when a disruption
occurs that prevents the execution of an ISTO Auction the Exchange will
publicly announce that the Quote-Only Period for the ISTO Auction, and
the Exchange will then cancel all orders on the BSTX Book and
disseminate a new scheduled time for the Quote-Only Period and opening
match.\169\ Similarly, when a disruption occurs that prevents the
execution of a Halt Auction, the Exchange will publicly announce that
no Halt Auction will occur, and all orders in the halted security token
on the BSTX Book will be canceled after which the Exchange will open
the security token for trading without an auction.\170\
---------------------------------------------------------------------------

    \169\ See proposed Rule 25040(d)(1).
    \170\ See proposed Rule 25040(d)(2). The Exchange notes that
these contingency procedures are substantially similar to those of
another exchange (see e.g., IEX Rule 11.350(c)(4)) and are designed
to ensure that the Exchange has appropriate mechanisms in place to
address possible disruptions that may arise in an ISTO Auction or
Halt Auction, consistent with the protection of investors and the
public interest pursuant to Section 6(b)(5) of the Exchange Act. 15
U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The opening process with respect to non-BSTX-listed security tokens
is set forth in proposed Rule 25040(e). Pursuant to that rule, BSTX
Participants who wish to participate in the opening process may submit
orders and quotes for inclusion in the BSTX Book, but such orders and
quotes cannot execute until the termination of the Pre-Opening Phase
(``Opening Process''). Orders that are canceled before the Opening
Process will not participate in the Opening Process. The Exchange will
attempt to perform the Opening Process and will match buy and sell
orders that are executable at the midpoint of the NBBO.\171\ Generally,
the price of the Opening Process will be at the midpoint of the first
NBBO subsequent to the first two-sided quotation published by the
listing exchange after 9:30:00 a.m. Eastern Time. Pursuant to proposed
Rule 25040(e)(4), if the conditions to establish the price of the
Opening Process set forth above do not occur by 9:45:00 a.m. Eastern
Time, orders will be handled in time sequence, beginning with the order
with the oldest time stamp, and will be placed on the BSTX Book
cancelled, or executed in accordance with the terms of the order. A
similar process will occur for re-opening a non-BSTX-listed security
token subject to a halt.\172\ The proposed opening process for security
tokens listed on another exchange serves as a placeholder in
anticipation of other exchanges eventually listing and trading security
tokens, or the equivalent thereof, given that there are no other
exchanges currently trading security tokens. The proposed process for
opening security tokens listed on another exchange is similar to
existing exchange rules governing the opening of trading of a security
listed on another exchange.\173\
---------------------------------------------------------------------------

    \171\ See proposed Rule 25040(e)(2).
    \172\ See proposed Rule 25040(e)(5).
    \173\ See e.g., Cboe BZX Rule 11.24.
---------------------------------------------------------------------------

    Consistent with Section 6(b)(5) of the Exchange Act,\174\ the
Exchange believes that the proposed process for opening trading in
BSTX-listed security tokens and security tokens listed on other
exchanges will promote just and equitable principles of trade and will
help perfect the mechanism of a free and open market by establishing a
uniform process to determine the opening price of security tokens.\175\
Proposed Rule 25040 provides a mechanism by which BSTX Participants may
submit orders in advance of the start of regular trading hours, perform
an opening cross, and commence regular hours trading in security tokens

listed on BSTX or otherwise. Where an opening cross is not possible in
a BSTX-listed security token, the Exchange will proceed by opening
regular hours trading in the security token anyway, which is consistent
with the manner in which other exchanges open trading in
securities.\176\ With respect to initial public offerings of security
tokens and openings after a Limit Up-Limit Down halt or trading pause,
BSTX proposes to use a process with features similar to its normal
opening process. There are a variety of different ways in which an
exchange can open trading in securities, including with respect to
initial security token offerings, and the Exchange believes that
proposed Rule 25040 provides a simple and clear method for opening
transactions that is consistent with the protection of investors and
the public interest.\177\ Additionally, proposed Rule 25040 applies to
all BSTX Participants in the same manner and is therefore not designed
to permit unfair discrimination among BSTX Participants.
---------------------------------------------------------------------------

    \174\ 15 U.S.C. 78f(b)(5).
    \175\ The Exchange has not proposed to operate a closing auction
at this time. As a result, the closing price of a security token on
BSTX would be the last regular way transaction occurring on BSTX,
which the Exchange believes is simple and fair way to establish the
closing price of a security token that does not permit unfair
discrimination among customers, issuers, or broker-dealers
consistent with Section 6(b)(5) of the Exchange Act. Id. This
proposed process is consistent with the overall proposed simplified
market structure for BSTX, which does not include a variety of order
types offered by other exchanges such as market-on-close and limit-
on-close orders. The Exchange believes that a simplified market
structure, including the proposed manner in which a closing price
would be determined, promotes the public interest and the protection
of investors consistent with Section 6(b)(5) of the Exchange Act
through reduced complexity. Id.
    \176\ See e.g., BOX Rule 7070.
    \177\ The Exchange notes that its proposed opening, ISTO
Auction, and Halt Auction processes are substantially similar to
those of another exchange. See Cboe BZX Rule 11.23. The key
differences between the Exchange's proposed processes and those of
the Cboe BZX exchange are that the Exchange has substantially fewer
order types, which make its opening process less complex, and that
the Exchange does not proposes to use order auction collars to limit
the price at which a security token opens. The Exchange does not
believe that auction collars are necessary at this time because
there are a variety of other mechanisms in place to prevent
erroneous orders and the execution of an opening cross at an
erroneous price (e.g., market access controls pursuant to Rule 15c3-
5 and the ability of an underwriter to request an extension to the
Quote-Only Period in an ISTO Auction).
---------------------------------------------------------------------------

6. Rule 25050--Trading Halts
    BSTX proposes to adopt rules relating to trading halts \178\ that
are substantially similar to other exchange rules adopted in connection
with the NMS Plan to Address Extraordinary Market Volatility (``LULD
Plan''), with certain exceptions that reflect Exchange functionality.
BSTX intends to join the LULD Plan prior to the commencement of trading
security tokens. Below is an explanation of BSTX's approach to certain
categories of orders during a trading halt:
---------------------------------------------------------------------------

    \178\ The Exchange notes that rules on opening trading for non-
BSTX-listed security token are set forth in proposed Rule 25040(e).
---------------------------------------------------------------------------

    7. Short Sales--BSTX cancels all orders on the book during a halt
and rejects any new orders, so rules relating to the repricing of short
sale orders during a trading halt that certain other exchanges have
adopted have been omitted.
    8. Pegged Orders--BSTX would not support pegged orders, at least
initially, so rules relating to pegged orders during a trading halt
have been omitted.
    9. Routable Orders--Because BSTX would initially be the only
exchange for trading security tokens, rules relating to handling of
routable orders during a trading halt have been omitted.
    10. Limit Orders--Because BSTX would cancel resting order interest
and reject incoming orders during a trading halt, specific rules
relating to the repricing of limit-priced interest that certain other
exchanges have adopted have been omitted.\179\
---------------------------------------------------------------------------

    \179\ See e.g., Cboe BZX 11.18(e)(5)(B).
---------------------------------------------------------------------------

    11. Auction Orders, Market Orders, and FOK Orders--BSTX would not
support these order types, at least initially, so rules relating to
these order types during a trading halt have been omitted.\180\
---------------------------------------------------------------------------

    \180\ IOC orders will be handled pursuant to proposed Rule
25050(g)(5).
---------------------------------------------------------------------------

    Pursuant to proposed Rule 25050(d), the Exchange would cancel all
resting orders in a non-BSTX listed security token subject to a trading
halt, reject any incoming orders in that security token, and will only
resume accepting orders following a broadcast message to BSTX
Participants indicating a forthcoming re-opening of trading.\181\
---------------------------------------------------------------------------

    \181\ Trading would resume pursuant to proposed Rule
25040(e)(5). See proposed Rule 25050(g)(7).
---------------------------------------------------------------------------

    BSTX believes that it is in the public interest and furthers the
protection of investors, consistent with Section 6(b)(5) of the
Exchange Act \182\ to provide for a mechanism to halt trading in
security tokens during periods of extraordinary market volatility
consistent with the LULD Plan. However, the Exchange has excluded rules
relating to order types and other aspects of the LULD Plan that would
not be supported by the Exchange, such as market orders and auction
orders. The Exchange has also reserved the right in proposed Rule
25050(f) to halt or suspend trading in other circumstances where the
Exchange deems it necessary to do so for the protection of investors
and in the furtherance of the public interest.
---------------------------------------------------------------------------

    \182\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that canceling resting order interest during
a trading halt and rejecting incoming orders received during the
trading halt is consistent with Section 6(b)(5) of the Exchange Act
\183\ because it is not designed to permit unfair discrimination among
BSTX Participants. The orders and trading interest of all BSTX
Participants would be canceled in the event of a trading halt and each
BSTX Participant would be required to resubmit any orders they had
resting on the order book.
---------------------------------------------------------------------------

    \183\ Id.
---------------------------------------------------------------------------

12. Rule 25060--Order Entry
    Proposed Rule 25060 sets forth the manner in which BSTX
Participants may enter orders to the BSTX System. The BSTX System would
initially only support limit orders.\184\ Orders that do not designate
a limit price would be rejected.\185\ The BSTX System would also only
support two time-in-force (``TIF'') designations initially: (i) DAY;
and (ii) immediate or cancel (``IOC''). DAY orders will queue during
the Pre-Opening Phase, may trade during regular market hours, and, if
unexecuted at the close of the trading day (4:00 p.m. ET), are canceled
by the BSTX System.\186\ All orders are given a default TIF of DAY.
BSTX Participants may also designate orders as IOC, which designation
overrides the default TIF of DAY. IOC orders are not accepted by the
BSTX System during the Pre-Opening Phase. During regular trading hours,
IOC orders will execute in whole or in part immediately upon receipt by
the BSTX System. The BSTX System will not support modification of
resting orders. To change the price or quantity of an order resting on
the BSTX Book, a BSTX Participant must cancel the resting order and
submit a new order, which will result in a new time stamp for purposes
of BSTX Book priority. In addition, all orders on BSTX will be
displayed, and the BSTX System will not support hidden orders or
undisplayed liquidity, as set forth in proposed Rule 25100.
---------------------------------------------------------------------------

    \184\ The BSTX System will also accept incoming Intermarket
Sweep Orders (``ISO'') pursuant to proposed Rule 25060(c)(2). ISOs
must be limit orders, are ineligible for routing, may be submitted
with a limit price during Regular Trading Hours, and must have a
time-in-force of IOC. Proposed Rule 25060(c)(2) is substantially
similar to rules of other national securities exchanges. See e.g.,
Cboe BZX Rule 11.9(d).
    \185\ Proposed Rule 25060(c)(1).
    \186\ Proposed Rule 25060(d)(1).
---------------------------------------------------------------------------

    Consistent with Section 6(b)(5) of the Exchange Act,\187\ the
Exchange believes that the proposed order entry rules will promote just
and equitable principles of trade and help perfect the mechanism of a
free and open market by establishing the types of orders and modifiers
that all BSTX Participants may use in entering orders to the BSTX
System. Because these order types and TIFs are available to all BSTX
Participants, the proposed rule does not unfairly discriminate among
market participants, consistent with Section 6(b)(5) of the Exchange
Act. The proposed rule sets forth a very simply exchange model whereby
there is only one order type--limit orders--and two TIFs. Upon the
initial launch

of BSTX, there will be no hidden orders, price sliding, pegged orders,
or other order type features that add complexity. The Exchange believes
that creating a simplified exchange model is designed to protect
investors and is in the public interest because it reduces complexity,
thereby helping market participants better understand how orders would
operate on the BSTX System.
---------------------------------------------------------------------------

    \187\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

13. Rule 25070--Audit Trail
    Proposed Rule 25070 (Audit Trail) is designed to ensure that BSTX
Participants provide the Exchange with information to be able to
identify the source of a particular order and other information
necessary to carry out the Exchange's oversight functions. The proposed
rule is substantially similar to existing BOX Rule 7120 but eliminates
certain information unique to orders for options contracts (e.g.,
exercise price) because security tokens are equity securities. The
proposed rule also provides that BSTX Participants that employ an
electronic order routing or order management system that complies with
Exchange requirements will be deemed to comply with the Rule if the
required information is recorded in an electronic format. The proposed
rule also specifies that order information must be kept for no less
than three years and that where specific customer or account number
information is not provided to the Exchange, BSTX Participants must
maintain such information on their books and records.
    The Exchange believes that proposed Rule 25070 is designed to
protect investors and the public interest, consistent with Section
6(b)(5) of the Exchange Act,\188\ because it will provide the Exchange
with information necessary to carry out its oversight role. Without
being able to identify the source and terms of a particular order, the
Exchange's ability to adequately surveil its market, with or through
another SRO, for trading inconsistent with applicable regulatory
requirements would be impeded. In order to promote compliance with Rule
201 of Regulation SHO, proposed Rule 25080(b)(3) provides that when a
short sale price test restriction is in effect, the execution price of
the short sale order must be higher than (i.e., above) the best bid,
unless the sell order is marked ``short exempt'' pursuant to Regulation
SHO.
---------------------------------------------------------------------------

    \188\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

14. Rule 25080--Execution and Price Time Priority
    Proposed Rule 25080 governs the execution of orders on the BSTX
System, providing a price-time priority model. The proposed rule
provides that orders of BSTX Participants shall be ranked and
maintained in the BSTX Book according to price-time priority, such that
within each price level, all orders shall be organized by the time of
entry. The proposed rule further provides that sell orders may not
execute a price below the best bid in the marketplace and buy orders
cannot execute at a price above the best offer in the marketplace.
Further, the proposed rule ensures compliance with Regulation SHO,
Regulation NMS, and the LULD Plan, in a manner consistent with the
rulebooks of other national securities exchanges.\189\
---------------------------------------------------------------------------

    \189\ See e.g., Cboe BZX Rule 11.13(a)(2)-(3) governing regular
trading hours.
---------------------------------------------------------------------------

    The Exchange believes that proposed Rule 25080 is consistent with
Section 6(b)(5) of the Exchange Act \190\ because it is designed to
promote just and equitable principles of trade and foster cooperation
and coordination with persons facilitating transactions in securities
by setting forth the order execution priority scheme for security token
transactions. Numerous other exchanges similarly operate a price-time
priority structure for effecting transactions. The proposed rule also
does not permit unfair discrimination among BSTX Participants because
all BSTX Participants are subject to the same price-time priority
structure. In addition, the Exchange believes that specifying in
proposed Rule 25080(b)(3) that execution of short sale orders when a
short sale price test restriction is in effect must occur at a price
above the best bid unless the order is market ``short exempt,'' is
consistent with the Exchange Act because it is intended promote
compliance with Regulation SHO in furtherance of the protection of
investors and the public interest.
---------------------------------------------------------------------------

    \190\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

15. Rule 25090--BSTX Risk Controls
    Proposed Rule 25090 sets forth certain risk controls applicable to
orders submitted to the BSTX System. The proposed risk controls are
designed to prevent the submission and execution of potentially
erroneous orders. Under the proposed rule, the BSTX System will reject
orders that exceed a maximum order size, as designated by each BSTX
Participant. The Exchange, however may set default values for this
control. The proposed rule also provides a means by which all of a BSTX
Participant's orders will be canceled in the event that the BSTX
Participant loses its connection to the BSTX System. Proposed Rule
25090(c) provides a risk control that prevents incoming limit orders
from being accepted by the BSTX System if the order's price is more
than a designated percentage away from the National Best Bid or Offer
in the marketplace. Proposed Rule 25090(d) provides a maximum order
rate control whereby the BSTX System will reject an incoming order if
the rate of orders received by the BSTX System exceeds a designated
threshold. With respect to both of these risk controls (price
protection for limit orders and maximum order rate), BSTX Participants
may designate the appropriate thresholds, but the Exchange may also
provide default values and mandatory minimum levels.
    The Exchange believes the proposed risk controls in Rule 25090 are
consistent with Section 6(b)(5) of the Exchange Act \191\ because they
are designed to help prevent the execution of potentially erroneous
orders, which furthers the protection of investors and the public
interest. Among other things, erroneous orders can be disruptive to the
operation of an exchange marketplace, can lead to temporary price
dislocations, and can hinder price formation. The Exchange believes
that offering configurable risk controls to BSTX Participants, along
with default values where a BSTX Participant has not designated its
desired controls, will protect investors by reducing the number of
erroneous executions on the BSTX System and will remove impediments to
and perfect the mechanism of a free and open market system. The
proposed risk controls are also similar to existing risk controls
provided by the Exchange to Options Participants.
---------------------------------------------------------------------------

    \191\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

16. Rule 25100--Trade Execution, Reporting, and Dissemination of
Quotations
    Proposed Rule 25100 provides that the Exchange shall collect and
disseminate last sale information for transactions executed on the BSTX
system. The proposed rule further provides that the aggregate of the
best-ranked non-marketable Limit Order(s), pursuant to Rule 25080, to
buy and the best-ranked non-marketable Limit Order(s) to sell in the
BSTX Book shall be collected and made available to quotation vendors
for dissemination. Proposed Rule 25100 further provides that the BSTX
System will operate as an ``automated market center'' within the
meaning of Regulation NMS and will display ``automated quotations'' at
all times except in the event of a system

malfunction.\192\ In addition, the proposed Rule specifies that the
Exchange shall identify all trades executed pursuant to an exception or
an exemption of Regulation NMS. The Exchange will disseminate last sale
and quotation information pursuant to Rule 602 of Regulation NMS and
will maintain connectivity to the securities information processors for
dissemination of quotation information.\193\ BSTX Participants may
obtain access to this information through the securities information
processors.
---------------------------------------------------------------------------

    \192\ 17 CFR 242.600(b)(4) and (5). The general purpose of an
exchange being deemed an ``automated trading center'' displaying
``automated quotations'' relates to whether or not an exchange's
quotations may be considered protected under Regulation NMS. See
Exchange Act Release No. 51808, 70 FR 37495, 37520 (June 29, 2005).
Other trading centers may not effect transactions that would trade
through a protected quotation of another trading center. The
Exchange believes that it is useful to specify that it will operate
as an automated trading center at this time to make clear to market
participants that it is not operating a manual market with respect
to security tokens.
    \193\ 17 CFR 242.602.
---------------------------------------------------------------------------

    Proposed Rule 25100(d) provides that executions that occur as a
result of orders matched against the BSTX Book, pursuant to Rule 25080,
shall clear and settle pursuant to the rules, policies, and procedures
of a registered clearing agency and shall settle on a T+1 basis (i.e.,
trade date plus one additional business day) where permitted under the
rules, policies, and procedures of the relevant registered clearing
agency. However, pursuant to proposed Rule 25100(d), the BSTX
Participants that are party to the trade may agree to a shorter or
longer settlement cycle as may be permitted by the relevant registered
clearing agency and where they have so agreed shall communicate that
agreement to the Exchange in a manner consistent with the Exchange's
procedures. Rule 25100(e) obliges BSTX Participants, or a clearing
member/participant clearing on behalf of a BSTX Participant to honor
trades effected on the BSTX System on the scheduled settlement date,
and the Exchange shall not be liable for the failure of BSTX
Participants to satisfy these obligations.\194\
---------------------------------------------------------------------------

    \194\ These proposed provisions are substantially similar to
those of exchanges. See e.g., Nasdaq Rule 4627 and IEX Rule 10.250.
---------------------------------------------------------------------------

    The Exchange believes that proposed Rule 25100 is consistent with
Section 6(b)(5) of the Exchange Act \195\ because it will foster
cooperation and coordination with persons processing information with
respect to, and facilitating transactions in securities by requiring
the Exchange to collect and disseminate quotation and last sale
transaction information to market participants. BSTX Participants will
need last sale and quotation information to effectively trade on the
BSTX System, and proposed Rule 25100 sets forth the requirement for the
Exchange to provide this information as well as the information to be
provided. The proposed rule is similar to rules of other exchanges
relating to the dissemination of last sale and quotation information.
The Exchange believes that requiring BSTX Participants (or firms
clearing trades on behalf of other BSTX Participants) to honor their
trade obligations on the settlement date is consistent with the
Exchange Act because it will foster cooperation with persons engaged in
clearing and settling transactions in security tokens, consistent with
Section 6(b)(5) of the Exchange Act.\196\
---------------------------------------------------------------------------

    \195\ 15 U.S.C. 78f(b)(5).
    \196\ Id.
---------------------------------------------------------------------------

17. Rule 25110--Clearly Erroneous
    Proposed Rule 25110 sets forth the manner in which BSTX will
resolve clearly erroneous executions that might occur on the BSTX
System and is substantially similar to comparable clearly erroneous
rules on other exchanges. Under proposed Rule 25100, transactions that
involve an obvious error such as price or quantity, may be canceled
after review and a determination by an officer of BSTX or such other
employee designee of BSTX (``Official'').\197\ BSTX Participants that
believe they submitted an order erroneously to the Exchange may request
a review of the transaction, and must do so within thirty (30) minutes
of execution and provide certain information, including the factual
basis for believing that the trade is clearly erroneous, to the
Official.\198\ Under proposed Rule 25100(c), an Official may determine
that a transaction is clearly erroneous if the price of the transaction
to buy (sell) that is the subject of the complaint is greater than
(less than) the ``Reference Price'' \199\ by an amount that equals or
exceeds specified ``Numerical Guidelines.'' \200\ The Official may
consider additional factors in determining whether a transaction is
clearly erroneous, such as whether trading in the security had recently
halted or overall market conditions.\201\ Similar to other exchanges
clearly erroneous rules, the Exchange may determine that trades are
clearly erroneous in certain circumstances such as during a system
disruption or malfunction, on a BSTX Officer's (or senior employee
designee) own motion, during a trading halt, or with respect to a
series of transactions over multiple days.\202\ Under proposed Rule
25110(e)(2), BSTX Participants affected by a determination by an
Official may appeal this decision to the Chief Regulatory Officer of
BSTX, provided such appeal is made within thirty (30) minutes after the
party making the appeal is given notice of the initial determination
being appealed.\203\ The Chief Regulatory Officer's determination shall
constitute final action by the Exchange on the matter at issue pursuant
to proposed Rule 25110(e)(2)(ii).
---------------------------------------------------------------------------

    \197\ A transaction made in clearly erroneous error and canceled
by both parties or determined by the Exchange to be clearly
erroneous will be removed from the Consolidated Tape. Proposed Rule
25110(a).
    \198\ Proposed Rule 25110(b). The Official may also consider
certain ``outlier'' transactions on a case by case basis where the
request for review is submitted after 30 minutes but no longer than
sixty (60) minutes after the transaction. Proposed Rule 2511(d).
    \199\ The Reference Price will be equal to the consolidated last
sale immediately prior to the execution(s) under review except for
in circumstances, such as, for example, relevant news impacting a
security or securities, periods of extreme market volatility,
sustained illiquidity, or widespread system issues, where use of a
different Reference Price is necessary for the maintenance of a fair
and orderly market and the protection of investors and the public
interest. Proposed Rule 25110(c)(1).
    \200\ The proposed Numerical Guidelines are 10% where the
Reference Price ranges from $0.00 to $25.00, 5% where the Reference
Price is greater than $25.00 up to and including $50.00, and 3%
where the Reference Price ranges is greater than $50. Proposed Rule
25110(c)(1).
    \201\ Proposed Rule 25110(c)(1).
    \202\ See proposed Rule 25110(f)-(j). These provisions are
virtually identical to similar provisions of other exchanges'
clearly erroneous rules other than by making certain administrative
edits (e.g., replacing the term ``security'' with ``security
token'').
    \203\ Determinations by an Official pursuant to proposed Rule
25110(f) relating to system disruptions or malfunctions may not be
appealed if the Official made a determination that the nullification
of transactions was necessary for the maintenance of a fair and
orderly market or the protection of invests and the public interest.
Proposed Rule 25110(d)(2).
---------------------------------------------------------------------------

    The Exchange believes that proposed Rule 25110 is consistent with
Section 6(b)(5) of the Exchange Act,\204\ because it would promote just
and equitable principles of trade, remove impediments to, and perfect
the mechanism of, a free and open market and a national market system
by setting forth the process by which clearly erroneous trades on the
BSTX System may be identified and remedied. Proposed Rule 25110 would
apply equally to all BSTX Participants and is therefore not designed to
permit unfair discrimination among BSTX Participants, consistent with
Section

6(b)(5) of the Exchange Act.\205\ The proposed rule is substantially
similar to the clearly erroneous rules of other exchanges.\206\ For
example, proposed Rule 25110 does not include provisions related to
clearly erroneous transactions for routed orders because orders for
security tokens will not route to other exchanges.\207\ Security tokens
would also only trade during regular trading hours (i.e., 9:30 a.m. ET
to 4:00 p.m. ET), so provisions from comparable exchange rules relating
to clearly erroneous executions occurring outside of regular trading
hours have been excluded. Proposed Rule 25110 also excludes provisions
from comparable clearly erroneous rules of certain other exchanges
relating to clearly erroneous executions in: (i) Leverage ETF/ETNs; and
(ii) unlisted trading privileges securities that are subject to an
initial public offering.\208\
---------------------------------------------------------------------------

    \204\ 15 U.S.C. 78f(b)(5).
    \205\ Id.
    \206\ See e.g., Cboe BZX Rule 11.17. Similar to other exchanges'
comparable rules, proposed Rule 25110 provides BSTX with the ability
to determine clearly erroneous trades that result from a system
disruption or malfunction, a BSTX Official acting on his or her own
motion, trading halts, multi-day trading events, multi-stock events
involving five or more (but less than twenty) securities whose
executions occurred within a period of five minutes or less, multi-
stock events involving twenty or more securities whose executions
occurred within a period of five minutes or less, and securities
subject to the LULD Plan.
    \207\ Other exchange clearly erroneous rules reference removing
trades from the Consolidated Tape. Because security token
transactions will be reported pursuant to a separate transaction
reporting plan, proposed Rule 25110 eliminates references to the
``Consolidated Tape'' and provides that clearly erroneous security
token transactions will be removed from ``all relevant data feeds
disseminating last sale information for security token
transactions.'' See proposed Rule 25110(a).
    \208\ The Exchange notes that not all equities exchanges have a
provision with respect to trade nullification for UTP securities
that are the subject of an initial public offering. See IEX Rule
11.270. With respect to leveraged ETFs/ETNs, the Exchange does not
expect to support trading of such products at this time, so the
Exchange does not believe it is necessary to include provisions
related to them.
---------------------------------------------------------------------------

    The Exchange believes that its proposed process for BSTX
Participants to appeal clearly erroneous execution determinations made
by an Exchange Official pursuant to proposed Rule 25110 to the Chief
Regulatory Officer of BSTX is consistent with Section 6(b)(5) of the
Exchange Act \209\ because it promotes just and equitable principles of
trade and fosters cooperation and coordination with persons regulating,
settling, and facilitating transactions in securities by providing a
clear and expedient process to appeal determinations made by an
Official. BSTX Participants benefit from having a quick resolution to
potentially clearly erroneous executions and giving the Chief
Regulatory Officer discretion to decide any appeals of an Official's
determination provides an efficient means to resolve potential appeals
that applies equally to all BSTX Participants and therefore does not
permit unfair discrimination among BSTX Participants, consistent with
Section 6(b)(5) of the Exchange Act. The Exchange notes that, with
respect to options trading on the Exchange, the Exchange's Chief
Regulatory Officer similarly has sole authority to overturn or modify
obvious error determinations made by an Exchange Official and that such
determination constitutes final Exchange action on the matter at
issue.\210\ In addition, proposed Rule 25110(e)(2)(iii) provides that
any determination made by an Official or the Chief Regulatory Officer
of BSTX under proposed Rule 25110 shall be rendered without prejudice
as to the rights of the parties to the transaction to submit their
dispute to arbitration. Accordingly, there is an additional safeguard
in place for BSTX Participants to seek further review of the Exchange's
clearly erroneous determination.
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    \209\ 15 U.S.C. 78f(b)(5).
    \210\ See BOX Rule 7170(n).
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    To the extent security tokens become tradeable on other national
securities exchanges or other changes arise that may necessitate
changes to proposed Rule 25110 to conform more closely with the clearly
erroneous execution rules of other exchanges, the Exchange intends to
implement changes as necessary through a proposed rule change filed
with the Commission pursuant to Section 19 of the Exchange Act \211\ at
such future date.
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    \211\ 15 U.S.C. 78s.
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18. Rule 25120--Short Sales
    Proposed Rule 25120 sets forth certain requirements with respect to
short sale orders submitted to the BSTX System that is virtually
identical to similar rules on other exchanges.\212\ Specifically,
proposed Rule 25120 requires BSTX Participants to appropriately mark
orders as long, short, or short exempt and provides that the BSTX
System will not execute or display a short sale order not marked short
exempt with respect to a ``covered security'' \213\ at a price that is
less than or equal to the current national best bid if the price of
that security decreases by 10% or more, as determined by the listing
market for the covered security, from the covered security's closing
price on the listing market as of the end of Regular Trading Hours on
the prior day (the ``Trigger Price''). The proposed rule further
specifies the duration of the ``Short Sale Price Test'' and that the
BSTX System shall determine whether a transaction in a covered security
has occurred at a Trigger Price and shall immediately notify the
responsible single plan processor.\214\
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    \212\ See e.g., IEX Rule 11.290.
    \213\ Proposed Rule 25120(b) provides that the terms ``covered
security,'' ``listing market,'' and ``national best bid'' shall have
the same meaning as in Rule 201 of Regulation SHO. 17 CFR
242.201(a).
    \214\ Proposed Rule 25120(d). The proposed rule further provides
in paragraph (d)(1) that if a covered security did not trade on BSTX
on the prior trading day, BSTX's determination of the Trigger Price
shall be based on the last sale price on the BSTX System for that
security token on the most recent day on which the security token
traded.
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    The Exchange believes that proposed Rule 25120 is consistent with
Section 6(b)(5) of the Exchange Act,\215\ because it would promote just
and equitable principles of trade and further the protection of
investors and the public interest by enforcing rules consistent with
Regulation SHO. Pursuant to Regulation SHO, broker-dealers are required
to appropriately mark orders as long, short, or short exempt,\216\ and
trading centers are required to establish, maintain, and enforce
written policies and procedures reasonably designed to, among other
things, prevent the execution or display of a short sale order of a
covered security at a price that is less than or equal to the current
national best bid if the price of that covered security decreases by
10% or more from its closing price on the primary listing market on the
prior day.\217\ Proposed Rule 25120 is designed to promote compliance
with Regulation SHO, is nearly identical to similar rules of other
exchanges, and would apply equally to all BSTX Participants.
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    \215\ 15 U.S.C. 78f(b)(5).
    \216\ 17 CFR 242.200(g).
    \217\ 17 CFR 242.201(b)(1).
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19. Rule 25130--Locking or Crossing Quotations in NMS Stocks
    Proposed Rule 25130 sets forth provisions related to locking or
crossing quotations. The proposed rule is substantially similar to the
rules of other national securities exchanges.\218\ Proposed Rule 25130
is designed to promote compliance with Regulation NMS and prohibits
BSTX participants from engaging in a pattern or practice of displaying
quotations that lock or cross a protected quotation unless an exception
applies. The Exchange notes that there may be no other national
securities exchanges trading security tokens upon the launch of BSTX
that may be displaying protected quotations. Notwithstanding that there
may be no other away markets displaying a protected quotation when
trading on

BSTX commences, the Exchange proposes in Rule 25130(d) that the BSTX
System will reject any order or quotation that would lock or cross a
protected quotation of another exchange at the time of entry.
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    \218\ See IEX Rule 25130.
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    The Exchange believes proposed Rule 25130 is consistent with
Section 6(b)(5) of the Exchange Act \219\ because it is designed to
promote just and equitable principles of trade and foster cooperation
and coordination with persons facilitating transactions in securities
by ensuring that the Exchange prevents display of quotations that lock
or cross any protected quotation in an NMS stock, in compliance with
applicable provisions of Regulation NMS.
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    \219\ 15 U.S.C. 78f(b)(5).
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20. Rule 25140--Clearance and Settlement: Anonymity
     Proposed Rule 25140 provides that each BSTX Participant
must either (1) be a member of a registered clearing agency that uses a
CNS system, or (2) clear transactions executed on the Exchange through
another Participant that is a member of such a registered clearing
agency. The Exchange would maintain connectivity and access to the UTC
of NSCC for transmission of executed transactions. The proposed Rule
requires a Participant that clears through another participant to
obtain a written agreement, in a form acceptable to the Exchange, that
sets out the terms of such arrangement. The proposed Rule also provides
that BSTX transaction reports shall not reveal contra party identities
and that transactions would be settled and cleared anonymously. In
certain circumstances, such as for regulatory purposes, the Exchange
may reveal the identity of a Participant or its clearing firm such as
to comply with a court order.
     The Exchange believes that proposed Rule 25140 is
consistent with Section 6(b)(5) of the Exchange Act \220\ because it
would foster cooperation and coordination with persons engaged in
regulating, clearing, settling, processing information with respect to,
and facilitating transactions in securities. Proposed Rule 25140 is
similar to rules of other exchanges relating to clearance and
settlement.\221\
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    \220\ 15 U.S.C. 78f(b)(5).
    \221\ See e.g. IEX Rule 11.250.
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J. Market Making on BSTX (Rule 25200 Series)
    The BSTX Market Making Rules (Rules 25200-25240) provide for
registration and describe the obligations of Market Makers on the
Exchange. The proposed Market Making Rules also provide for
registration and obligations of Designated Market Makers (``DMMs'') in
a given security token, allocation of a DMM to a particular security
token, and parameters for business combinations of DMMs.
    Proposed Rule 25200 sets forth the basic registration requirement
for a BSTX Market Maker by noting that a Market Maker must enter a
registration request to BSTX and that such registration shall become
effective on the next trading day after the registration is entered,
or, in the Exchange's discretion, the registration may become effective
the day that it is entered (and the Exchange will provide notice to the
Market Maker in such cases). The proposed Rule further provides that a
BSTX Market Maker's registration shall be terminated by the Exchange if
the Market Maker fails to enter quotations within five business days
after the registration becomes effective.\222\
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    \222\ Proposed Rule 25200 is substantially similar to IEX Rule
11.150.
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    Proposed Rule 25210 sets forth the obligations of Market Makers,
including DMMs. Under the proposed Rule, a BSTX Participant that is a
Market Maker, including a DMM, is generally required to post two-sided
quotes during the regular market session for each security token in
which it is registered as a Market Maker.\223\ The Exchange proposes
that such quotes must be entered within a certain percentage, called
the ``Designated Percentage,'' of the National Best Bid (Offer) price
in such security token (or last sale price, in the event there is no
National Best Bid (Offer)) on the Exchange.\224\ The Exchange proposes
that the Designated Percentage would be 30%.\225\ The Exchange notes
that the proposed Designated Percentage is substantially similar to the
corresponding Designated Percentage for NYSE American market makers
with respect to Tier 2 NMS stocks (as defined under the LULD
plan).\226\ The Exchange believes that the proposed Designated
Percentage for quotation obligations of Market Makers would be
sufficient to ensure that there is adequate liquidity sufficiently
close to the National Best Bid or Offer (``NBBO'') in security tokens
and to ensure fair and orderly markets. The Exchange notes that
pursuant to proposed Rule 25210(a)(1)(iii), there is nothing to
preclude a Market Maker from entering trading interest at price levels
that are closer to the NBBO, so Market Makers have the ability to quote
must closer to the NBBO than required by the Designated Percentage
requirement if they so choose.
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    \223\ See proposed Rule 25210(a)(1).
    \224\ See proposed Rule 25210(a)(1)(ii)(A).
    \225\ See proposed Rule 25210(a)(1)(ii)(B).
    \226\ See NYSE American Rule 7.23E(a)(1)(B)(iii) (providing
that, other than during certain time periods around the market open
and close, the Designated Percentage for Tier 2 NMS stocks priced
below $1.00 is 30% and for Tier 2 NMS stocks priced above $1.00 is
28%).
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    The Exchange proposes in Rule 25210(a)(4) that, in the event that
price movements cause a Market Maker or DMM's quotations to fall
outside of the National Best Bid (Offer) (or last sale price in the
event there is no National Best Bid (Offer)) by a given percentage,
with such percentage called the ``Defined Limit,'' in a security token
for which they are a Market Maker, the Market Maker or DMM must enter a
new bid or offer at not more than the Designated Percentage away from
the National Best Bid (Offer) in that security token. The Exchange
proposes that the Defined Limit shall be 31.5%.\227\ Under the proposed
Rules, Market Maker's quotations must be firm and automatically
executable for their size, and, to the extent the Exchange finds that a
Market Maker has a substantial or continued failure to meet its
quotation obligations, such Market Maker may face disciplinary action
from the Exchange.\228\ Under the proposed Market Maker and DMM Rules,
Market Makers and DMMs two-sided quotation obligations must be
maintained for a quantity of a ``normal unit of trading'' which is
defined as one security token.\229\ The Exchange believes that security
tokens may initially trade in smaller increments relative to other
listed equities and that reducing the two-sided quoting increment from
one round lot (i.e., 100 shares) to one security token will be
sufficient to meet liquidity demands and would make it easier for
Market Makers and DMMs to meet their quotation obligations, which in
turn incentivize more Market Maker participation.
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    \227\ See proposed Rule 25210(a)(1)(ii)(3).
    \228\ See proposed Rule 25210(b) and (c). Pursuant to proposed
Rule 25310(d), a BSTX Market Maker, other than a DMM may apply for a
temporary withdrawal from its Market Maker status provided it meets
certain conditions such a demonstrating legal or regulatory
requirements that necessitate its temporary withdrawal.
    \229\ See proposed Rule 25210(a)(1).
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    The Exchange notes that proposed Rule 25210 is substantially
similar to NYSE American Rule 7.23E, with the exceptions of: (i) The
modified normal unit of trading, Designated Percentage, and Defined
Limit (as discussed above); (ii) specifying that the minimum quotation
increment shall be $0.01; and

(iii) specifying that Market Maker quotations must be firm for their
displayed size and automatically executable. The Exchange believes that
the additional specifications with respect to the minimum quotation
increment and firm quotation requirement will add additional clarity to
the expectations of Market Makers on the Exchange.
    Proposed Rule 25220 sets forth the registration requirements for a
DMM. Under proposed Rule 25220, a DMM must be a registered Market Maker
and be approved as a DMM in order to receive an allocation of security
tokens pursuant to proposed Rule 25230, which is described below.\230\
For security tokens in which a Participant serves as a DMM, it must
meet the same obligations as if it were a Market Maker and must also
maintain a bid or offer at the National Best Bid and Offer at least 25%
of the day measured across all security tokens in which such
Participant serves as DMM.\231\ The proposed Rule provides, among other
things, that a there will be no more than one DMM per security token
and that a DMM must maintain information barriers between the trading
unit operating as a DMM and the trading unit operating as a BSTX Market
Maker in the same security token (to the extent applicable).\232\ The
Rule further provides a process by which a DMM may temporarily withdraw
from its DMM status, which is similar to the same process for a BSTX
Market Maker \233\ and similar to the same process for DMMs on other
exchanges.\234\ The Exchange notes that proposed Rule 25220 is
substantially similar to NYSE American Rule 7.24E with the exception
that the Exchanges proposes to add a provision stating that the
Exchange is not required to assign a DMM if the security token has an
adequate number of BSTX Market Makers assigned to such security token.
The purpose of this requirement is to acknowledge the possibility that
a security token need not necessarily have a DMM provided there are at
least two Market Makers assigned to the security token, consistent with
proposed Rule 26106 (Market Maker Requirement), which is discussed
further below.
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    \230\ See proposed 25220(b). DMMs would be approved by the
Exchange pursuant to an application process an [sic]
    \231\ See proposed Rule 25220(c).
    \232\ See proposed Rule 25220(b).
    \233\ See proposed Rule 25210(d).
    \234\ See e.g., NYSE American Rule 7.24E(b)(4).
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    In proposed Rule 25230, the Exchange proposes to set forth the
process by which a DMMs are allocated and reallocated responsibility
for a particular security token. Proposed Rule 25230(a) sets forth the
basic eligibility criteria for a when a security token may be allocated
to a DMM, providing that this may occur when the security token is
initially listed on BSTX, when it is reassigned pursuant to Rule 25230,
or when it is currently listed without a DMM assigned to the security
token.\235\ Proposed Rule 2530(a) also specifies that a DMM's
eligibility to participate in the allocation process is determined at
the time the interview is scheduled by the Exchange and specifies that
a DMM must meet with the quotation requirements set forth in proposed
Rule 25220(c) (DMM obligations). The proposed Rule further specifies
how the Exchange will handle several situations in which the DMM does
not meet its obligations, such as, for example, by issuing an initial
warning advising of poor performance if the DMM fails to meet its
obligations for a one-month period.\236\
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    \235\ As previously noted, pursuant to proposed Rule 26106, a
security token may have a minimum of two non-DMM market makers to be
eligible for listing on the Exchange. Consequently, a security token
might not have a DMM when it initially begins trading on BSTX, but
may acquire a DMM later.
    \236\ See proposed Rule 25230(a)(4). The proposed handling of
these scenarios where a DMM does not meet its obligations is
substantially similar to parallel requirements in NYSE American Rule
7.25E(a)(4).
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    Proposed Rule 25230(b) sets forth the manner in which a DMM may be
selected and allocated a security token. Under proposed Rule 25230(b),
an issuer may select its DMM directly, delegate the authority to the
Exchange to selects its DMM, or may opt to proceed with listing without
a DMM, in which case a minimum of two non-DMM Market Makers must be
assigned to its security token consistent with proposed Rule 26106.
Proposed Rule 25230(b) further sets forth provisions relating to the
interview between the issuer and DMMs, the Exchange selection by
delegation, and a requirement that a DMM serve as a DMM for a security
token for at least one year unless compelling circumstances exist for
which the Exchange may consider a shorter time period. Each of these
provisions is substantially similar to corresponding provisions in NYSE
American Rule 7.25E(b)(1)-(3), with the exception that the Exchange may
shorten the one year DMM commitment period in compelling
circumstances.\237\ Proposed Rule 25230(b) further sets forth specific
provisions related to a variety of different issuances and types of
securities, including spin-offs or related companies, warrants, rights,
relistings, equity security token listing after preferred security
token, listed company mergers, target security tokens, and closed-end
management investment companies.\238\ Each of these provisions is
substantially similar to corresponding provisions in NYSE American Rule
7.25E(b)(4)-(11).
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    \237\ The Exchange believes that providing the Exchange with
flexibility to shorten the one year commitment period is appropriate
to accommodate unforeseen events or circumstances that might arise
with respect to a DMM, such as a force majeure event, preventing a
DMM from being able to carry out its functions.
    \238\ See proposed Rule 25230(b)(4)-(11).
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    Proposed Rule 25230(c) sets forth the reallocation process for a
DMM in a manner that is substantially similarly to corresponding
provisions in NYSE American Rule 7.25E(c). Generally, under the
proposed Rule, an issuer may request a reallocation to a new DMM and
Exchange staff will review this request, along with any DMM response
letter, and eventually make a determination.\239\ Proposed Rule
25230(d), (e), and (f), set forth provisions governing an allocation
freeze, allocation sunset, and criteria for applicants that are not
currently DMMs to be eligible to be allocated a security token as a DMM
respectively. Each of these provisions are likewise substantially
similar to corresponding provisions in NYSE American Rule 7.25E(d)-(f).
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    \239\ In addition, proposed Rule 25230(c)(2) sets forth
provisions that allow for the Exchange's CEO to immediately initiate
a reallocation proceeding upon written notice to the DMM and the
issuer when the DMM's performance in a particular market situation
was, in the judgment of the Exchange, so egregiously deficient as to
call into question the Exchange's integrity or impair the Exchange's
reputation for maintaining an efficient, fair, and orderly market.
---------------------------------------------------------------------------

    Finally, proposed Rule 25240 sets forth the DMM combination review
policy. The proposed Rule, among other things, defines a proposed
combination among DMMs, requires that DMMs provide a written submission
to the Office of the Corporate Secretary of the Exchange and specifies,
among other things, the items to be disclosed in the written
submission, the criteria that the Exchange will use to evaluate a
proposed combination, and the timing for a decision by the Exchange,
subject to the Exchange's right to extend such time period. The
Exchange notes that proposed Rule 25240 is substantially similar to
NYSE American Rule 7.26E.
    The Exchange believes that the proposed Market Making Rules set
forth in the Rule 25200 Series are consistent with Section 6(b)(5) of
the Exchange Act \240\ because they are designed to

promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in facilitating transactions in
securities, and to remove impediments to and perfect the mechanism of a
free and open market and a national market system. The Exchange notes
that the proposed Rules are substantially similar to the market making
rules of other exchanges, as detailed above,\241\ and that all BSTX
Participants are eligible to become a Market Maker or DMM provided they
comply with the proposed requirements.\242\ The proposed Market Maker
Rules set forth the quotation and related expectations of BSTX Market
Makers which the Exchange believes will help ensure that there is
sufficient liquidity in security tokens. Although the corresponding
NYSE American rules upon which the proposed Rules are based provide for
multiple tiers and classes of stocks that were each associated with a
different Designated Percentage and Defined Limit, the Exchange has
collapsed all such classes in to one category and provided a single
Designated Percentage of 30% and Defined Limit of 31.5% for all
security token trading on BSTX. The Exchange believes that simplifying
the Rules in this manner can reduce the potential for confusion and
allows for easier compliance and will still adequately serve the
liquidity needs of investors of security token investors, which the
Exchange believes promotes the removal of impediments to and perfection
of the mechanism of a free and open market and a national market
system, consistent with Section 6(b)(5) of the Exchange Act.\243\
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    \240\ 15 U.S.C. 78f(b)(5).
    \241\ See NYSE American Rule 7, Section 2.
    \242\ In this regard, the Exchange believes the proposed Market
Making Rules are not designed to permit unfair discrimination
between BSTX Participants, consistent with Section 6(b)(5) of the
Exchange Act. 15 U.S.C. 78f(b)(5).
    \243\ 15 U.S.C. 78f(b)(5).
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    The Exchange has also proposed that the minimum quotation size of
Market Makers will be one security token. As noted above, the Exchange
believes that security tokens may initially trade in smaller increments
relative to other listed equities and that reducing the two-sided
quoting increment from one round lot (i.e., 100 shares) to one security
token would be sufficient to meet liquidity demands and would make it
easier for Market Makers and DMMs to meet their quotation obligations,
which in turn incentivize more Market Maker participation. The Exchange
believes that adopting quotation requirements and parameters that are
appropriate for the nature and types of securities that will trade on
the Exchange will promote the protection of investors and the public
interest by assuring that the Exchange Rules are appropriately tailored
to its market.
K. BSTX Listing Rules (Rule 26000 and 27000 Series)
    The BSTX Listing Rules, which include the Rule 26000 and
27000Series, have been adapted from, and are substantially similar to,
Parts 1-12 of the NYSE American LLC Company Guide.\244\ Except as
described below, each proposed Rule in the BSTX 26000 and 27000 series
is substantially similar to a Section of the NYSE American Company
Guide.\245\ Below is further detail.
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    \244\ All references to various ``Sections'' in the discussion
of these Listing Rules refer to the various Sections of the NYSE
American Company Guide.
    \245\ The Exchange notes that while the numbering of BSTX's
Listing Rules generally corresponds to a Section of the NYSE
American LLC Company Guide, BSTX did not integrate certain Sections
of the NYSE American Company Guide that the Exchange deemed
inapplicable to its operations, such as with respect to types of
securities which the Exchange is not proposing to make eligible for
listing (e.g., foreign issuers, other than those from Canada).
Further, the Exchange formulated a small amount of new rules to
reflect requirements relating to the use of blockchain technology as
an ancillary recordkeeping mechanism, as described more fully
herein. The Exchange also proposes to modify cross-references in the
proposed Listing Rules to accord with its Rules.
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     The BSTX Listing Rules (26100 series) are based on the
NYSE American Original Listing Requirements (Sections 101-146).\246\
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    \246\ Pursuant to proposed Rule 26135, all securities initially
listing on BSTX, except securities which are book-entry only, must
be eligible for a Direct Registration Program operated by a clearing
agency registered under Section 17A of the Exchange Act. 15 U.S.C.
78q-1.
---------------------------------------------------------------------------

     The BSTX Original Listing Procedures (26200 series) are
based on the NYSE American Original Listing Procedures (Sections 201-
222).
     The BSTX Additional Listings Rules (26300 series) are
based on the NYSE American Additional Listings Sections (Sections 301-
350).
     The BSTX Disclosure Policies (26400 series) are based on
the NYSE American Disclosure Policies (Sections 401-404).
     The BSTX Dividends and Splits Rules (26500 series) are
based on the NYSE American Dividends and Stock Splits Sections
(Sections 501-522).
     The BSTX Accounting; Annual and Quarterly Reports Rules
(26600 series) are based on the NYSE American Accounting; Annual and
Quarterly Reports Sections (Sections 603-624).
     The BSTX Shareholders' Meetings, Approval and Voting of
Proxies Rules (26700 series) are based on the NYSE American
Shareholders' Meetings, Approval and Voting of Proxies Sections
(Sections 701-726).\247\
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    \247\ The Exchange notes that the proposed fees for certain
items in the proposed Listing Rules (e.g., proxy follow-up mailings)
are the same as those charged by NYSE American. See e.g., proposed
IM-26722-8 cf. NYSE American Section 722.80.
---------------------------------------------------------------------------

     The BSTX Corporate Governance Rules (26800 series) are
based on the NYSE American Corporate Governance Sections (Sections 801-
809).
     The BSTX Additional Matters Rules (26900 series) are based
on the NYSE American Additional Matters Sections (Sections 920-994).
     The BSTX Suspension and Delisting Rules (27000 series) are
based on the NYSE American Suspension and Delisting Sections (Sections
1001-1011).
     The BSTX Guide to Filing Requirements (27100 series) are
based on the NYSE American Guide to Filing Requirements (Section 1101).
     The BSTX Procedures for Review of Exchange Listing
Determinations (27200 series) are based on the NYSE American Procedures
for Review of Exchange Listing Determinations (Sections 1201-1211).
    Notwithstanding that the proposed BSTX Listing Rules are
substantially similar to those of other exchanges, BSTX proposes
certain additions or modifications to these rules specific to its
market. For example, BSTX proposes to add definitions that apply to the
proposed BSTX Listing Rules. The definitions set forth in proposed Rule
26000 are designed to facilitate understanding of the BSTX Listing
Rules by market participants. Increased clarity may serve to remove
impediments to and perfect the mechanism of a free and open market and
a national market system and may also foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, consistent with Section 6(b)(5) of the Exchange
Act.\248\
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    \248\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    With respect to initial listing standards, as set forth in proposed
Rule 26101, the Exchange proposes to adopt listing standards that are
20% lower than the NYSE American listing rules on which they are
based.\249\ For example, NYSE American provides that in its initial
listing standard 1, the size of shareholders' equity must be at least
$4,000,000 and the pre-tax income from continuing operations for a
company to be eligible for listing must be at least $750,000 in its
last fiscal year, or in two

of its last three fiscal years.\250\ BSTX proposes that these
thresholds would be $3,200,000 and (size of shareholders' equity) and
$600,000 (pre-tax income) respectively.\251\ The Exchange also proposes
to adopt initial listing requirements for secondary classes of security
tokens based on Nasdaq Rule 5510 with quantitative standards also 20%
reduced as compared to the source rule (Nasdaq Rule 5510).\252\
Specifically, proposed BSTX Rule 26101(i) sets forth certain
requirements for a secondary class of a security token such as a
minimum bid price of at least $3 per security token, at least 80 Round
Lot \253\ holders, at least 160,000 publicly held, and a market value
of publicly held security tokens of at least $2.8 million.\254\
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    \249\ See NYSE American Section 101.
    \250\ Id. at Section 101(a)(1) and (2). The Exchange notes that
it has proposed in Rule 26101(a)(4) as a component of Initial
Listing Standard 1 that a prospective issuer would be required to
have an aggregate market value of publicly held security tokens of
$2,400,000. NYSE American Section 101(a) does not provide for an
aggregate market value of publicly held securities explicitly in its
rules, but does appear to provide for such a requirement in certain
other materials related to its listing rules. See e.g., NYSE
American Initial Listing Standards available at https://www.nyse.com/publicdocs/nyse/listing/NYSE_American_Initial_Listing_Standards.pdf (noting with respect to
``Standard 1'' a requirement of ``$3MM'' for the ``Market value of
public float''). The Exchange proposes the threshold of $2,400,000
as a 20% reduction of this standard.
    \251\ See proposed BSTX Rule 26101(a)(1) and (2). As another
example proposed initial listing standard 4, as set forth in
proposed BSTX Rule 26101(d)(1) would require that a prospective
listed company have a total market capitalization of $60,000,000 (or
total assets and total revenue of $60,000,000 each in its last
fiscal year, or two of its last three fiscal years), while the
parallel NYSE American provisions set this threshold at $75,000,000.
    \252\ See proposed BSTX Rule 26101(i).
    \253\ A ``Round Lot'' is proposed to be defined in Rule
26000(a)(7) as 100 security tokens of a particular issuer.
    \254\ Nasdaq Rule 5510 sets these thresholds at $4 per security
token, 100 round lot holders, 200,000 publicly held shares, and a
market value of publicly held shares of $3.5 million.
---------------------------------------------------------------------------

    The Exchange believes that the proposed thresholds are sufficiently
robust to assure that only bona fide companies will be listed on BSTX.
The Exchange notes that non-quantitative criteria for exchange listing
are important in ensuring that bona fide companies will list on the
Exchange and that all non-quantitative criteria proposed by the
Exchange substantially match existing standards of other national
securities exchanges, such as NYSE American. The Exchange believes that
the proposed quantitative listing standards, in combination with non-
quantitative listing standards such as corporate governance
requirements and two years of operation for certain listing
standards,\255\ are sufficient to ensure high quality issuers and to
protect investors and the public interest and promote fair and orderly
markets in accordance with Section 6(b)(5) of the Exchange Act.\256\ In
addition, by modestly lowering the quantitative thresholds relative to
other exchanges, the Exchange believes that the proposed listing
standards will promote capital formation by expanding the universe of
possible issuers and issuers of secondary classes. The Exchange also
notes that its proposed quantitative listing thresholds exceed those of
another listing exchange.\257\ Thus, the Exchange believes that only
issuers with substantial public float, investor base, and trading
interest will be listed on the Exchange.
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    \255\ See e.g., proposed BSTX Rule 26101(a)(1) and (b)(1).
    \256\ 15 U.S.C. 78f(b)(5).
    \257\ See Nasdaq BX Venture Market Rules 5505 and 5506. In
contrast with BX Ventures, the Exchange will not list securities
that will be considered ``penny stocks.'' Thus, while BX Ventures
implemented certain enhanced issuer vetting procedures, the Exchange
does not deem these necessary, since it has retained non-
quantitative listing criteria at a level comparable to traditional
exchanges like NYSE American along with quantitative listing
criteria significantly more robust than BX Ventures. The Exchange
therefore believes that only bona fide companies will be able to
meet its proposed listing criteria.
---------------------------------------------------------------------------

    The Exchange believes the proposed rules providing an additional
initial listing requirement for preferred security tokens, reduced
quantitative listing thresholds, and provide an additional option for
listing subscription rights would expand the possible universe of
companies that would be eligible to list on the Exchange. The Exchange
believes that these proposed rules would help remove impediments to and
perfection of the mechanism of a free and open market and a national
market system, consistent with Section 6(b)(5) of the Exchange
Act.\258\ Further, consistent with the public interest, rules that
provide more opportunity for listings may promote competition among
listing exchanges and capital formation for issuers. The Exchange notes
that these Rules are based upon existing standards in the NYSE American
LLC Company Guide.
---------------------------------------------------------------------------

    \258\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    In certain instances, BSTX proposes to add additional provisions
not currently provided for in the NYSE American LLC Company Guide that
are specific to security tokens. For example, pursuant to proposed Rule
26230 (Security Token Architecture Audit), prior to approving a
security token for trading on BSTX, the Exchange would conduct an audit
of the security token's architecture to ensure compliance with the BSTX
Protocol as outlined in Rule 26138.\259\ The purpose of this
requirement is to ensure that the design and structure of a prospective
BSTX-listed company's security token is compatible with the BSTX
Protocol for purposes of facilitating updates to the blockchain as an
ancillary recordkeeping mechanism. The Exchange may use third party
service providers that have demonstrated sufficient technical expertise
in blockchain technology and an understanding of the BSTX Protocol to
conduct this audit on behalf of the Exchange. The Exchange believes
that these proposed Rules would foster cooperation and coordination
with persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, consistent with Section 6(b)(5) of the Exchange Act,\260\
because they would facilitate the ancillary recordkeeping mechanism for
BSTX-listed security tokens which is a first step toward the potential
integration of blockchain technology to securities transactions.
Without ensuring that BSTX-listed companies' security tokens are
compatible with the BSTX Protocol, the use of blockchain technology as
an ancillary recordkeeping mechanism could be impaired.
---------------------------------------------------------------------------

    \259\ Proposed Rule 26230 further provides that an applicant
that is denied pursuant to this section may appeal the decision via
the process outlined in the Rule 27200 Series.
    \260\ Id.
---------------------------------------------------------------------------

    As discussed above, the definitions in proposed Rule 26000 are
designed to facilitate understanding of the BSTX Listing Rules by
market participants. The Exchange believes that allowing market
participants to better understand and interpret the BSTX Listing Rules
removes impediments to and perfects the mechanism of a free and open
market and a national market system, and may also foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, consistent with Section 6(b)(5) of the
Exchange Act.\261\
---------------------------------------------------------------------------

    \261\ Id.
---------------------------------------------------------------------------

    The Exchange also proposes certain enhancements to the notice
requirements for listed companies to communicate to BSTX related to
record dates and defaults.\262\ The Exchange believes that these
additional disclosure

and communication obligations can help BSTX in monitoring for listed
company compliance with applicable rules and regulations; such
additional disclosure obligations are 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, consistent with Section
6(b)(5) of the Exchange Act.\263\
---------------------------------------------------------------------------

    \262\ See Proposed Rule 26502, which requires, among other
things, a listing company to give the Exchange at least ten days'
notice in advance of a record date established for any other
purpose, including meetings of shareholders.
    \263\ Id.
---------------------------------------------------------------------------

    The Exchange's proposed Rules provide additional flexibility for
listed companies in choosing how liquidity would be provided in their
listings by allowing listed companies to use two market makers in lieu
of a DMM.\264\ Pursuant to proposed Rule 26205, a company may choose to
be assigned a DMM by the Exchange or to select its own DMM.\265\
Alternatively, a company may elect, or the Exchange may determine,
that, in lieu of a DMM, a minimum of two (2) market makers would be
assigned to the security token. The Exchange believes that such
additional flexibility would promote the removal of impediments to and
perfection of the mechanism of a free and open market and a national
market system, consistent with Section 6(b)(5) of the Exchange
Act.\266\ The Commission has previously approved exchange rules
providing for only two market makers to be assigned to a particular
security, either initially or on an ongoing basis, and, in accordance
with these previously approved rules, the Exchange believes two market
makers would be sufficient to ensure fair and orderly markets and
provide sufficient liquidity for security tokens.
---------------------------------------------------------------------------

    \264\ See proposed Rule 26205. The Exchange believes that two
market makers are sufficient to assure competing quotations for
potential buyers and sellers of security tokens on BSTX. The
Exchange notes that other listing markets require two market makers
for their initial listing requirements or for their continued
listing requirements, and therefore the Exchange believes that its
proposal will ensure sufficient liquidity in security tokens. See
Nasdaq BX Ventures Rule 5505(a)(7), Nasdaq BX Ventures Rule
5506(a)(5), and Nasdaq Stock Market Rule 5225(4)(B).
    \265\ Exchange personnel responsible for managing the listing
and onboarding process will be responsible for determining to which
DMM a security token will be assigned. As provided in proposed Rule
26205, the Exchange makes every effort to see that each security
token is allocated in the best interests of the company and its
shareholders, as well as that of the public and the Exchange.
Similarly, the Exchange anticipates that these same personnel will
be responsible for answering questions relating to the Exchange's
listing rules pursuant to proposed Rule 26994 (New Policies). The
Exchange notes that certain provisions in the NYSE American Listing
Manual contemplate a ``Listing Qualifications Analyst'' that would
perform a number of these functions. The Exchange is not proposing
to adopt provisions that specifically contemplate a ``Listing
Qualifications Analyst,'' but expects to have personnel that will
perform the same basic functions, such as advising issuers and
prospective issuers with respect to the BSTX Listing Rules.
    \266\ Id.
---------------------------------------------------------------------------

    The Exchange also proposes a number of other non-substantive
changes from the baseline NYSE American listing rules, such as to
eliminate references to the concept of a ``specialist,'' since BSTX
will not have a specialist,\267\ or references to certificated
equities, since security tokens will be uncertificated equities.\268\
As another example, NYSE American Section 623 requires that three
copies of certain press releases be sent to the exchange, while the
Exchange proposes only that a single copy of such press release be
shared with the Exchange.\269\ In addition, the Exchange proposes to
adopt Rule 26720 in a manner that is substantially similar to NYSE
American Section 720, but proposes to modify the internal citations to
ensure consistency with its proposed Rulebook.\270\ In its proposed
Rules, the Exchange has not included certain form letters related to
proxy rules that are included in the NYSE American rules; \271\
instead, these forms will be included in the BSTX Listing
Supplement.\272\ The Exchange is not proposing to adopt provisions
relating to future priced securities at this time.\273\ In addition,
the Exchange is not proposing to allow for listing of foreign
companies, other than Canadian companies,\274\ or to allow for issuers
to

transfer their existing securities to BSTX.\275\ Similarly, the
Exchange is not proposing at this time to support security token debt
securities, so the Exchange has not proposed to adopt certain
provisions from the NYSE American Listing Manual related to bonds/debt
securities \276\ or the trading of units.\277\ The Exchange believes
that the departures from the NYSE American rules upon which the
proposed Rules are based, as described above, are non-substantive
(e.g., by not including provisions relating to instruments that will
not trade on the Exchange), would apply to all issuers in the same
manner and are therefore not designed to permit unfair discrimination,
consistent with Section 6(b)(5) of the Exchange Act.\278\
---------------------------------------------------------------------------

    \267\ See e.g., NYSE American Section 513(f), noting that open
orders to buy and open orders to sell on the books of a specialist
on an ex rights date are reduced by the cash value of the rights.
Proposed Rule 26340(f) deletes this provision because BSTX will not
have specialists. Similarly, because BSTX will not have specialists,
the Exchange is not proposing to adopt a parallel rule to NYSE
American Section 516, which specifies that certain types of orders
are to be reduced by a specialist when a security is quoted ex-
dividend, ex-distribution or ex-rights are set forth in NYSE
American Rule 132.
    \268\ See e.g., NYSE American Section 117 including a clause
relating to paired securities for which ``the stock certificates of
which are printed back-to-back on a single certificate'').
Similarly, the Exchange has proposed to replace certain references
to the ``Office of General Counsel'' contained in certain NYSE
American Listing Rule (see e.g., Section 1205) with references to
the Exchange's ``Legal Department'' to accommodate differences in
BSTX's organizational structure. See proposed Rule 27204. As another
example, proposed Rule 27205 refers to the Exchange's ``Hearing
Committee'' as defined in Section 6.08 of the Exchange's By-Laws to
similarly accommodate organizational differences between the
Exchange and NYSE American.
    \269\ See proposed Rule 26623.
    \270\ Specifically, proposed Rule 26720 would provide that
participants must comply with Rules 26720 through 26725 and BSTX's
Rule 22020 (Forwarding of Proxy and Other Issuer-Related Materials;
Proxy Voting). NYSE American Section 726, upon which proposed Rule
26720 is based, includes cross-references to NYSE American's
corresponding rules to proposed Rules 26720 through 26725, and also
includes cross-references to NYSE American Rules 578 through 585,
for which the Exchange is not proposing corresponding rules. These
NYSE American rules for which the Exchange is not proposing to adopt
a parallel rule relate to certain requirements specific to proxy
voting (e.g., requiring that a member state the actual number of
shares for which a proxy is given--NYSE American Rule 578) or, in
some cases, relate to certificated securities (e.g., NYSE American
Rule 579), which would be inapplicable to the Exchange since it
proposes to only list uncertificated securities. The Exchange
believes that it does not need to propose to adopt parallel rules
corresponding to NYSE American Rules 578-585 at this time and notes
that other listing exchanges do not appear have corresponding
versions of these NYSE American Rules. See e.g., Cboe BZX Rules. The
Exchange believes that proposed Rule 26720 and the Exchange's other
proposed Rules governing proxies, including those referenced in
proposed Rule 26720, are sufficient to govern BSTX Participants'
obligations with respect to proxies.
    \271\ The forms found in NYSE American Section 722.20 and 722.40
will be included in the BSTX Listing Supplement.
    \272\ The BSTX Listing Supplement would contain samples of
letters containing the information and instructions required
pursuant to the proxy rules to be given to clients in the
circumstances indicated in the appropriate heading. These are
intended to serve as examples and not as prescribed forms.
Participants would be permitted to adapt the form of these letters
for their own purposes provided all of the required information and
instructions are clearly enumerated in letters to clients. Pursuant
to proposed Rule 26212, the BSTX Listing Supplement would also
include a sample application for original listing, which the
Exchange has included as Exhibit 3G. In addition, proposed Rule
26350 states that the BSTX Listing Supplement will include a sample
cancellation notice; the Exchange expects such notice to be
substantially in the same form as NYSE American's sample notice in
NYSE American Section 350. Other examples of items that would appear
in the BSTX Listing Supplement include certain certifications to be
completed by the CEO of listed companies pursuant to proposed Rule
26810(a) and (c), and forms of letters to be sent to clients
requesting voting instructions and other letters relating to proxy
votes pursuant to proposed IM-26722-2 and IM-26722-4. The Exchange
expects that these proposed materials in the BSTX Listing Supplement
will be substantially similar to the corresponding versions of such
samples used by NYSE American. The purpose of putting these sample
letters and other information into the BSTX Listing Supplement
rather than directly in the rules is to improve the readability of
the Rules.
    \273\ See e.g., NYSE American Section 101, Commentary .02. The
Exchange is also not proposing to adopt a parallel provision to NYSE
American Section 950 (Explanation of Difference between Listed and
Unlisted Trading Privileges) because the Exchange believes that such
provision is not necessary and contains extraneous historical
details that are not particularly relevant to the trading of
security tokens. The Exchange notes that numerous other listing
exchanges do not have a similar provision to NYSE American Section
950. See e.g., IEX Listing Rules.
    \274\ See proposed Rule 26109. Because the Exchange does not
propose to allow foreign issuers of security tokens, it does not
propose to adopt a parallel provision to NYSE American Section 110
and other similar provisions relating to foreign issuers--e.g., NYSE
American Section 801(f).
    \275\ Consequently, the Exchange does not propose to adopt a
parallel provision to NYSE American Section 113 at this time.
    \276\ See e.g., NYSE American Sections 1003(b)(iv) and (e).
    \277\ See e.g., NYSE American Sections 106(f), 401(i), and
1003(g).
    \278\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange proposes in Rule 26507 to prohibit the issuance of
fractional security tokens and to provide that cash must be paid in
lieu of any distribution or part of a distribution that might result in
fractional interests in security tokens.\279\ The Exchange believes
that disallowing fractional shares reduces complexity. By extension,
the requirement to provide cash in lieu of fractional shares simplifies
the process related to share transfer and tracking of share ownership.
The Exchange believes that this simplification promotes just and
equitable principles of trade, fosters cooperation and coordination
with persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, removes impediments to and perfect the mechanism of a free
and open market and a national market system, and, in general, protects
investors and the public interest, consistent with Section 6(b)(5) of
the Exchange Act.\280\
---------------------------------------------------------------------------

    \279\ The Exchange also proposes certain conforming changes in
Rule 26503 (Form of Notice) to reiterate that fractional interests
in security tokens are not permitted by the Exchange.
    \280\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Proposed BSTX Rule 26130 (Original Listing Applications) would
require listing applicants to furnish a legal opinion that the
applicant's security token is a security under applicable United States
securities laws. Such a requirement provides assurance to the Exchange
that security token trading relates to appropriate asset classes. The
Exchange believes that this Rule promotes just and equitable principles
of trade and, in general, protects investors and the public interest,
consistent with Section 6(b)(5) of the Exchange Act.\281\
---------------------------------------------------------------------------

    \281\ Id.
---------------------------------------------------------------------------

    The Exchange proposes to adopt corporate governance listing
standards as its Rule 26800 series that are substantially similar to
the corporate governance listing standards set forth in Part 8 of the
NYSE American Listing Manual. However, it includes certain
clarifications, most notably that certain proposed provisions are not
intended to restrict the number of terms that a director may serve
\282\ and that, if a limited partnership is managed by a general
partner rather than a board of directors, the audit committee
requirements applicable to the listed entity should be satisfied by the
general partner.\283\ The Exchange also notes that, unlike the current
NYSE American rules upon which the proposed Rules are based, the
proposed Rules on corporate governance do not include provisions on
asset-asset backed securities and foreign issues (other than those from
Canada), since the Exchange does not proposed to allow for such foreign
issuers to list on BSTX at this time.
---------------------------------------------------------------------------

    \282\ See proposed Rule 26802(d).
    \283\ See proposed Rule 26801(b).
---------------------------------------------------------------------------

    The Exchange proposes to adopt additional listing rules as its Rule
26900 series that are substantially similar to the corporate governance
listing standards set forth in Part 9 of the NYSE American Listing
Manual. The only significant difference from the baseline NYSE American
rules is that the proposed BSTX Rules do not include provisions related
to certificated securities, since security tokens listed on BSTX will
be uncertificated.
    The Exchange proposes to adopt suspension and delisting rules as
its Rule 27000 series that are substantially similar to the corporate
governance listing standards set forth in Parts 10, 11, and 12 of the
NYSE American Listing Manual. The proposed rules do not include
concepts from the baseline NYSE American rules regarding foreign, fixed
income securities, or other non-equity securities because the Exchange
is not proposing to allow for listing of such securities at this
time.\284\
---------------------------------------------------------------------------

    \284\ As with all sections of the proposed rules, references to
``securities'' have been changed to ``security tokens'' where
appropriate and, in the Rule 27000 series, certain references have
been conformed from the baseline NYSE American provisions to account
for the differences in governance structure and naming conventions
of BSTX.
---------------------------------------------------------------------------

    The Exchange believes that the proposals in the Rule 26800 to Rule
27000 Series, which are based on the rules of NYSE American with the
differences explained above, are designed to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, 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. Further, the differences in
the proposals compared to the analogous NYSE American provisions
appropriately reflect the differences between the two exchanges. The
Exchange believes that ensuring that its systems are appropriately
described in the BSTX Rules facilitates market participants' review of
such Rules, which serves to remove impediments to and perfect the
mechanism of a free and open market and a national market system by
ensuring that market participants can easily navigate, understand and
comply with the Exchange's rulebook. Therefore, the Exchange believes
its proposals are consistent with Section 6(b)(5) of the Exchange
Act.\285\
---------------------------------------------------------------------------

    \285\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

L. Fees (Rule 28000 Series)
    The Exchange proposes to set forth as its Rule 28000 Series (Fees)
the Exchange's authority prescribe reasonable dues, fees, assessments
or other charges as it may deem appropriate.\286\ As provided in
proposed Rule 28000 (Authority to Prescribe Dues, Fees, Assessments and
Other Charges), these fees may include membership dues, transaction
fees, communication and technology fees, regulatory fees, and other
fees, which will be equitably allocated among BSTX Participants,
issuers, and other persons using the Exchange's facilities.\287\
Proposed Rule 28010 (Regulatory Revenues) generally provides that any
revenues received by the Exchange from

fees derived from its regulatory function or regulatory fines will not
be used for non-regulatory purposes or distributed to the stockholder,
but rather, shall be applied to fund the legal and regulatory
operations of the Exchange (including surveillance and enforcement
activities).
---------------------------------------------------------------------------

    \286\ As described above, recording information to the Ethereum
blockchain requires payment of gas by the individual or entity who
desires to post such a record. The payment of gas will be performed
by the Wallet Manager as a service provider to the Exchange carrying
out the function of updating the Ethereum blockchain as an ancillary
recordkeeping mechanism. The Exchange does not plan to charge a fee
to cover the costs associated with gas and updating the Ethereum
blockchain. The Exchange also notes that gas costs are typically
negligible and anticipates actual monthly gas expenditures to be of
a de minims amount.
    \287\ Proposed Rule 28000 further provides authority for the
Exchange to charge BSTX Participants a regulatory transaction fee
pursuant to Section 31 of the Exchange Act (15 U.S.C. 78ee) and that
the Exchange will set forth fees pursuant to publicly available
schedule of fees.
---------------------------------------------------------------------------

    The Exchange believes that the proposed Rule 28000 Series (Fees) is
consistent with Sections 6(b)(5) of the Exchange Act because these
proposed rules are designed to protect investors and the public
interest by setting forth the Exchange's authority to assess fees on
BSTX Participants, which would be used to operate the BSTX System and
surveil BSTX for compliance with applicable laws and rules. The
Exchange believes that the proposed Rule 28000 Series (Fees) is also
consistent with Sections 6(b)(3) of the Exchange Act \288\ because the
proposed Rules specify that all fees assessed by the Exchange shall be
equitably allocated among BSTX Participants, issuers and other persons
using the Exchange's facilities. The Exchange notes that the proposed
Rule 28000 Series is substantially similar to the existing rules of
another exchange.\289\ The Exchange intends to submit a proposed rule
change to the Commission setting forth the proposed fees relating to
trading on BSTX in advance of the launch of BSTX.
---------------------------------------------------------------------------

    \288\ 15 U.S.C. 78f(b)(5).
    \289\ See Cboe BZX Rules 15.1 and 15.2.
---------------------------------------------------------------------------

IV. Minor Rule Violation Plan
    The Exchange's disciplinary rules, including Exchange Rules
applicable to ``minor rule violations,'' are set forth in the Rule
12000 Series of the Exchange's current Rules. Such disciplinary rules
would apply to BSTX Participants and their associated persons pursuant
to proposed Rule 24000. The Exchange's Minor Rule Violation Plan
(``MRVP'') specifies those uncontested minor rule violations with
sanctions not exceeding $2,500 that would not be subject to the
provisions of Rule 19d-1(c)(1) under the Exchange Act \290\ requiring
that an SRO promptly file notice with the Commission of any final
disciplinary action taken with respect to any person or
organization.\291\ The Exchange's MRVP includes the policies and
procedures set forth in Exchange Rule 12140 (Imposition of Fines for
Minor Violations).
---------------------------------------------------------------------------

    \290\ 17 CFR 240.19d-1(c)(1).
    \291\ The Commission adopted amendments to paragraph (c) of Rule
19d-1 to allow SROs to submit for Commission approval plans for the
abbreviated reporting of minor disciplinary infractions. See
Exchange Act Release No. 21013 (June 1, 1984), 49 FR 23828 (June 8,
1984). Any disciplinary action taken by an SRO against any person
for violation of a rule of the SRO which has been designated as a
minor rule violation pursuant to such a plan filed with and declared
effective by the Commission will not be considered ``final'' for
purposes of Section 19(d)(1) of the Exchange Act if the sanction
imposed consists of a fine not exceeding $2,500 and the sanctioned
person has not sought an adjudication, including a hearing, or
otherwise exhausted his administrative remedies.
---------------------------------------------------------------------------

    The Exchange proposes to amend its MRVP and Rule 12140 to include
proposed Rule 24010 (Penalty for Minor Rule Violations). The Rules
included in proposed Rule 24010 as appropriate for disposition under
the Exchange's MRVP are: (a) Rule 20000 (Maintenance, Retention and
Furnishing of Records); (b) Rule 25070 (Audit Trail); (c) Rule
25210(a)(1) (Two-Sided Quotation Obligations of BSTX Market Makers);
and Rule 25120 (Short Sales). The rules included in proposed Rule 12140
are the same as the rules included in the MRVPs of other
exchanges.\292\ Upon implementation of this proposal, the Exchange will
include the enumerated trading rule violations in the Exchange's
standard quarterly report of actions taken on minor rule violations
under the MRVP. The quarterly report includes: The Exchange's internal
file number for the case, the name of the individual and/or
organization, the nature of the violation, the specific rule provision
violated, the sanction imposed, the number of times the rule violation
has occurred, and the date of disposition. The Exchange's MRVP, as
proposed to be amended, is consistent with Sections 6(b)(1), 6(b)(5)
and 6(b)(6) of the Exchange Act,\293\ which require, in part, that an
exchange have the capacity to enforce compliance with, and provide
appropriate discipline for, violations of the rules of the Commission
and of the exchange. In addition, because amended Rule 12140 will offer
procedural rights to a person sanctioned for a violation listed in
proposed Rule 24010, the Exchange will provide a fair procedure for the
disciplining of members and associated persons, consistent with Section
6(b)(7) of the Exchange Act.\294\
---------------------------------------------------------------------------

    \292\ See e.g., IEX Rule 9.218 and Cboe BZX Rule 8.15.01.
    \293\ 15 U.S.C. 78f(b)(1), 78f(b)(5) and 78f(b)(6).
    \294\ 15 U.S.C. 78f(b)(7).
---------------------------------------------------------------------------

    This proposal to include the rules listed in Rule 24010 in the
Exchange's MRVP is consistent with the public interest, the protection
of investors, or otherwise in furtherance of the purposes of the
Exchange Act, as required by Rule 19d-1(c)(2) under the Exchange
Act,\295\ because it should strengthen the Exchange's ability to carry
out its oversight and enforcement responsibilities as an SRO in cases
where full disciplinary proceedings are unsuitable in view of the minor
nature of the particular violation. In requesting the proposed change
to the MRVP, the Exchange in no way minimizes the importance of
compliance with Exchange Rules and all other rules subject to the
imposition of fines under the MRVP. However, the MRVP provides a
reasonable means of addressing rule violations that do not rise to the
level of requiring formal disciplinary proceedings, while providing
greater flexibility in handling certain violations. The Exchange will
continue to conduct surveillance with due diligence and make a
determination based on its findings, on a case-by-case basis, whether a
fine of more or less than the recommended amount is appropriate for a
violation under the MRVP or whether a violation requires a formal
disciplinary action.
---------------------------------------------------------------------------

    \295\ 17 CFR 240.19d-1(c)(2).
---------------------------------------------------------------------------

V. Amendments to Existing BOX Rules
    Due to the new BSTX trading facility and the introduction of
trading in security tokens, a type of equity security, on the Exchange,
the Exchange proposes to amend those Exchange Rules that would apply to
BSTX Participants, but that currently only contemplate trading in
options. Therefore, the Exchange is seeking to amend the following
Exchange Rules, each of which is set forth in Exhibit 5B:
     Rule 100(a) (Definitions) ``Options Participant'' or
``Participant'': The Exchange proposes to change the definition of
``Options Participant or Participant'' to ``Participant'' to reflect
Options Participants and BSTX Participants and to amend the definition
as follows: ``The term `Participant' means a firm, or organization that
is registered with the Exchange pursuant to the Rule 2000 Series for
purposes of participating in trading on a facility of the Exchange and
includes an `Options Participant' and `BSTX Participant.' ''
     Rule 100(a) (Definitions) ``Options Participant'': The
Exchange proposes to add a definition of ``Options Participant'' that
would be defined as follows: ``The term `Options Participant' is a
Participant registered with the Exchange for purposes of participating
in options trading on the Exchange.'' \296\
---------------------------------------------------------------------------

    \296\ In addition, as a result of these new defined terms, the
Exchange proposes to renumber definitions set forth in Rule 100(a)
to keep the definitions in alphabetically order.
---------------------------------------------------------------------------

     Rule 2020(g)(2) (Participant Eligibility and
Registration): The Exchange proposes to delete subsection (g)(2) and
replace it with the following: ``(2) persons associated with a
Participant whose functions are related solely and exclusively to
transactions in

municipal securities; (3) persons associated with a Participant whose
functions are related solely and exclusively to transactions in
commodities; (4) persons associated with a Participant whose functions
are related solely and exclusively to transactions in securities
futures, provided that any such person is appropriately registered with
a registered futures association; and (5) persons associated with a
Participant who are restricted from accessing the Exchange and that do
not engage in the securities business of the Participant relating to
activity that occurs on the Exchange.'' \297\
---------------------------------------------------------------------------

    \297\ In addition to revising Rule 2020(g)(2) to broaden it to
include securities activities beyond just options trading, the
Exchange proposes to add greater specificity to define persons that
are exempt from registration, consistent with the approach adopted
by other exchanges. See e.g., IEX Rule 2.160(m).
---------------------------------------------------------------------------

     Rule 2060 (Revocation of Participant Status or Association
with a Participant): The Exchange proposes to amend Rule 2060 to refer
to ``securities transactions'' rather than ``options securities
transactions.''
     Rule 3180(a) (Mandatory Systems Testing): The Exchange
proposes to amend subsection (a)(1) of Rule 3180 to also include BSTX
Participants, in addition to the categories of Market Makers and OFPs.
     Rule 7130(a)(2)(v) Execution and Price/Time Priority: The
Exchange proposes to update the cross reference to Rule 100(a)(58) to
refer to Rule 100(a)(59), which defines the term ``Request for Quote''
or ``RFQ'' under the Rules after the proposed renumbering.
     Rule 7150(a)(2) (Price Improvement Period): The Exchange
proposes to amend Rule 7150(a)(2) to update the cross reference to the
definition of a Professional in Rule 100(a)(51) to instead refer to
Rule 100(a)(52), which is where that term would be defined in the Rules
after the proposed renumbering.
     Rule 7230 (Limitation of Liability): The Exchange proposes
to amend the references in Rule 7230 to ``Options Participants'' to
simply ``Participants.''
     Rule 7245(a)(4) (Complex Order Price Improve Period): The
Exchange proposes to update the cross reference to Rule 100(a)(51) to
refer to Rule 100(a)(52), which defines the term ``Professional'' after
the proposed renumbering.
     IM-8050-3: The Exchange proposes to update the cross
reference to Rule 100(a)(55) to refer to Rule 100(a)(56), which defines
the term ``quote'' or ``quotation'' after the proposed
renumbering.\298\
---------------------------------------------------------------------------

    \298\ Current Exchange Rule 100(a)(55) defines the term
``Quarterly Options Series,'' but the intended reference in IM-8050-
3 was the definition of ``quote'' or ``quotation.'' The term
``quote'' or ``quotation'' is currently defined in Rule 100(a)(56),
but is proposed to be renumbered as Rule 100(a)(57).
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     Rule 11010(a) ``Investigation Following Suspension'': The
Exchange proposes to amend subsection (a) of Rule 11010 to remove the
reference to ``in BOX options contracts'' and to modify the word
``position'' with the word ``security'' as follows: ``. . . the amount
owing to each and a complete list of each open long and short security
position maintained by the Participant and each of his or its
Customers.''
     Rule 11030 (Failure to Obtain Reinstatement): The Exchange
proposes to amend Rule 11030 to replace the reference to ``Options
Participant'' to simply ``Participant.''
     Rule 12030(a)(1) (Letters of Consent): The Exchange
proposes to amend subsection (a)(1) of Rule 12030 to replace the
reference to ``Options Participant'' to simply ``Participant.''
     Rule 12140 (Imposition of Fines for Minor Rule
Violations): The Exchange proposes to amend Rule 12140 to replace
references to ``Options Participant'' to simply ``Participant.'' In
addition, the Exchange proposes to add paragraph (f) to Rule 12140, to
incorporate the aforementioned modifications to the Exchange's MRVP.
New paragraph (f) of Rule 12140 would provide: ``(f) Transactions on
BSTX. Rules and penalties relating to trading on BSTX that are set
forth in Rule 24010 (Penalty for Minor Rule Violations).''
    The Exchange believes that the proposed amendments to the
definitions set forth in Rule 100 are consistent with Section 6(b)(5)
of the Exchange Act \299\ because they protect investors and the public
interest by setting forth clear definitions that help BOX and BSTX
Participants understand and apply Exchange Rules. Without defining
terms used in the Exchange Rules clearly, market participants could be
confused as to the application of certain rules, which could cause harm
to investors.
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    \299\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed amendments to the other
Exchange Rules detailed above are consistent with Section 6(b)(5) of
the Exchange Act \300\ because the proposed rule change is designed to
foster cooperation and coordination with persons engaged in
facilitating transactions in securities, 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.
The Exchange believes that the proposed rule change would remove
impediments to and perfect the mechanism of a free and open market and
a national market system by ensuring that market participants can
easily navigate, understand and comply with the Exchange's rulebook.
The Exchange believes that the proposed rule change enables the
Exchange to continue to enforce the Exchange's rules. The Exchange
notes that none of the proposed changes to the current Exchange
rulebook would materially alter the application of any of those Rules,
other than by extending them to apply to BSTX Participants and trading
on the BSTX System. As such, the proposed amendments would foster
cooperation and coordination with persons engaged in facilitating
transactions in securities and would remove impediments to and perfect
the mechanism of a free and open market and a national exchange system.
Further, the Exchange believes that, by ensuring the rulebook
accurately reflects the intention of the Exchange's rules, the proposed
rule change reduces potential investor or market participant confusion.
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    \300\ Id.
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VI. Forms To Be Used in Connection with BSTX
    In connection with the operation of BSTX, the Exchange proposes to
uses a series of new forms to facilitate becoming a BSTX Participant
and for issuers to list their security tokens. These forms have been
attached hereto as Exhibits 3A--3N. Each are described below.
A. BSTX Participant Application
    Pursuant to proposed Rule 18000(b), in order to become a BSTX
Participant, an applicant must complete a BSTX Participant Application,
which is attached as Exhibit 3A. The proposed BSTX Participant
Application requires the applicant to provide certain basic information
such as identifying the applicants name and contact information,
Designated Examining Authority, organizational structure, and Central
Registration Depository (``CRD'') number. The BSTX Participant
Application also requires applicants to provide additional information
including certain beneficial ownership information, the applicant's
current Form BD, an organization chart, a description of how the
applicant receives orders from customers, how it will send orders to
BSTX, and a copy of

written supervisory procedures and information barrier procedures.
    In addition, the BSTX Participant Application allows applicants to
indicate whether they are applying to be a BSTX Market Maker or a
Designated Market Maker. Applicants wishing to become a BSTX Market
Maker or Designated Market Maker must provide certain additional
information including a list of each of the applicant's trading
representatives (including a copy of each representative's Form U4), a
copy of the applicant's written supervisory procedures relating to
market making, a description of the source and amount of the
applicant's capital, and information regarding the applicant's other
business activities and information barrier procedures.
B. BSTX Participant Agreement
    Pursuant to Exchange Rule 18000(b), to transact business on BSTX,
prospective BSTX Participants must complete a BSTX Participant
Agreement. The BSTX Participant Agreement is attached as Exhibit 3B.
The BSTX Participant Agreement provides that a BSTX Participant must
agree with the Exchange as follows:
    1. Participant agrees to abide by the Rules of the Exchange and
applicable bylaws, as amended from time to time, and all circulars,
notices, interpretations, directives and/or decisions adopted by the
Exchange.
    2. Participant acknowledges that BSTX Participant and its
associated persons are subject to the oversight and jurisdiction of the
Exchange.
    3. Participant authorizes the Exchange to make available to any
governmental agency or SRO any information it may have concerning the
BSTX Participant or its associated persons, and releases the Exchange
from any and all liability in furnishing such information.
    4. Participant acknowledges its obligation to update any and all
information contained in any part of the BSTX Participant's
application, including termination of membership with another SRO.
    These provisions of the BSTX Participant Agreement and others
therein are generally designed to reflect the Exchange's SRO
obligations to regulate BSTX Participants. Accordingly, these
provisions contractually bind a BSTX Participant to comply with
Exchange rules, acknowledge the Exchange's oversight and jurisdiction,
authorize the Exchange to disclose information regarding the
Participant to any governmental agency or SRO and acknowledge the
obligation to update any and all Application contained in the
Participant's application.
C. BSTX User Agreement
    In order to become a BSTX Participant, prospective participants
must also execute a BSTX User Agreement pursuant to proposed Rule
18000(b). The BSTX User Agreement, attached as Exhibit 3C, includes
provisions related to the term of the agreement, compliance with
exchange rules, right and obligations under the agreement, changes to
BSTX, proprietary rights under the agreement, use of information
received under the relationship, disclaimer of warranty, limitation of
liability, indemnification, termination and assignment. The information
is necessary to outline the rights and obligations of the prospective
Participant and the Exchange under the terms of the agreement. Both the
BSTX Participant Agreement and BSTX User Agreement will be available on
the Exchange's website (boxoptions.com).
D. BSTX Security Token Market Designated Market Maker Selection Form
    In accordance with proposed Rule 25230(b)(1), BSTX will maintain
the BSTX Security Token Designated Market Maker Selection Form, which
is attached as Exhibit 3D. The issuer may select its DMM from among a
pool of DMMs eligible to participate in the process. Within two
business days of the issuer selecting its DMM, it will use the BSTX
Security Token Market Designated Market Maker Selection form to notify
BSTX of the selection. The form must be signed by a duly authorized
officer as specified in proposed Rule 25230(b)(1).
E. Clearing Authorization Forms
    In accordance with proposed Rule 18010, BSTX Participants that are
not members/participants of a registered clearing agency must clear
their transactions through a BSTX Participant that is a member of a
registered clearing agency. A BSTX Participant clearing through another
BSTX Participant would do so using, as applicable, either the BSTX
Clearing Authorization (non-Market Maker) form (attached as Exhibit 3E)
or the BSTX Participant Clearing Authorization (Market Maker) form
(attached as Exhibit 3F). Each form would be maintained by BSTX and
each form specifies that the BSTX Participant clearing on behalf of the
other BSTX Participant accepts financial responsibility for all
transactions on BSTX that are made by the BSTX Participant designated
on the form.
F. BSTX Listing Applications
    The Exchange proposes to specify the required forms of listing
application, listing agreement and other documentation that listing
applicants and listed companies must execute or complete (as
applicable) as a prerequisite for initial and ongoing listing on the
Exchange, as applicable (collectively, ``listing documentation''). As
proposed, the listing forms are substantially similar to those
currently in use by NYSE American LLC, with certain differences to
account for the trading of security tokens. All listing documentation
will be available on the Exchange's website (boxoptions.com). Each of
the listing documents form a duly authorized representative of the
company must sign an affirmation that the information provided is true
and correct as of the date the form was signed. In the event that in
the future the Exchange makes any substantive changes (including
changes to the rights, duties, or obligations of a listed company or
listing applicant or the Exchange, or that would otherwise require a
rule filing) to such documents, it will submit a rule filing in
accordance with Rule 19b-4.\301\
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    \301\ The Exchange will not submit a rule filing if the changes
made to a document are solely typographical or stylistic in nature.
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    Pursuant to Rule 26130 and 26300 of the Exchange Rules, a company
must file and execute the BSTX Original Listing Application (attached
as Exhibit 3G) or the BSTX Additional Listing Application (attached as
Exhibit 3H) to apply for the listing of security tokens on BSTX.\302\
The BSTX Original Listing Application provides information necessary,
and in accordance with Section 12(b) of the Exchange Act,\303\ for
Exchange regulatory staff to conduct a due diligence review of a
company to determine if it qualifies for listing on the Exchange. The
BSTX Additional Listing Application requires certain further
information for an additional listing of security tokens. Relevant
factors regarding the company and securities to be listed would
determine the type of information required. The following describes
each category and use of application information:
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    \302\ Pursuant to proposed Exchange Rule 26130, an applicant
seeking the initial listing of its security token must also provide
a legal opinion that the applicant's security token is a security
under applicable United States securities laws.
    \303\ 15 U.S.C. 781(b).
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    1. Corporate information regarding the issuer of the security to be
listed, including company name, address, contact information, Central
Index Key Code (CIK), SEC File Number, state and country of
incorporation, date of

incorporation, whether the company is a foreign private issuer, website
address, SIC Code, CUSIP number of the security being listed and the
date of fiscal year end. This information is required of all applicants
and is necessary in order for the Exchange's regulatory staff to
collect basic company information for recordkeeping and due diligence
purposes, including review of information contained in the company's
SEC filings.
    2. For original listing applications only, corporate contact
information including the company's Chief Executive Officer, Chief
Financial Officer, Corporate Secretary, General Counsel and Investor
Relations Officer. This information is required of all initial
applicants and is necessary in order for the Exchange's regulatory
staff to collect current company contact information for purposes of
obtaining any additional due diligence information to complete a
listing qualification review of the applicant.
    3. For original listing applications only, offering and security
information regarding an offering, including the type of offering, a
description of the issue, par value, number of security tokens
outstanding or offered, total security tokens unissued, but reserved
for issuance, date authorized, purpose of security tokens to be issued,
number of security tokens authorized, and information relating to
payment of dividends. This information is required of all applicants
listing security tokens on the Exchange, and is necessary in order for
the Exchange's regulatory staff to collect basic information about the
offering.
    4. For original listing applications only, information regarding
the company's transfer agent. Transfer agent information is required
for all applicants. This information is necessary in order for the
Exchange's regulatory staff to collect current contact information for
such company transfer agent for purposes of obtaining any additional
due diligence information to complete a listing qualification review of
the applicant.
    5. For original listing applications only, contact information for
the outside counsel with respect to the listing application, if any.
This information is necessary in order for the Exchange's regulatory
staff to collect applicable contact information for purposes of
obtaining any additional due diligence information to complete a
listing qualification review of the applicant and assess compliance
with Exchange Rule 26130.
    6. For original listing applications only, a description of any
security preferences. This information is necessary to determine
whether the Applicant issuer has any existing class of common stock or
equity securities entitling the holders to differential voting rights,
dividend payments, or other preferences.
    7. For original listing applications only, type of security token
listing, including the type of transaction (initial security token
offering, merger, spin-off, follow on offering, reorganization,
exchange offer or conversion) and other details related to the
transaction, including the name and contact information for the
investment banker/financial advisor contacts. This information is
necessary in order for the Exchange's regulatory staff to collect
information for such company for purposes of obtaining any additional
due diligence information to complete a listing qualification review of
the applicant.
    8. For original listing applications only, exchange requirements
for listing consideration. This section notes that to be considered for
listing, the Applicant Issuer must meet the Exchange's minimum listing
requirements, that the Exchange has broad discretion regarding the
listing of any security token and may deny listing or apply additional
or more stringent criteria based on any event, condition or
circumstance that makes the listing of an Applicant Issuer's security
token inadvisable or unwarranted in the opinion of the Exchange. The
section also notes that even if an Applicant Issuer meets the
Exchange's listing standards for listing on the BSTX Security Token
Market, it does not necessarily mean that its application will be
approved. This information is necessary in order for the Exchange's
regulatory staff to assess whether an Applicant Issuer is qualified for
listing.
    9. For original listing applications only, regulatory review
information, including a certification that no officer, board member or
non-institutional shareholder with greater than 10% ownership of the
company has been convicted of a felony or misdemeanor relating to
financial issues during the past ten years or a detailed description of
any such matters. This section also notes that the Exchange will review
background materials available to it regarding the aforementioned
individuals as part of the eligibility review process. This regulatory
review information is necessary in order for the Exchange's regulatory
staff to assess whether there are regulatory matters related to the
company that render it unqualified for listing.
    10. For original listing applications only, supporting
documentation required prior to listing approval includes a listing
agreement, corporate governance affirmation, security token design
affirmation, listing application checklist and underwriter's letter.
This documentation is necessary in order to support the Exchange's
regulatory staff listing qualification review (corporate governance
affirmation, listing application checklist and underwriter's letter)
and to effectuate the listed company's agreement to the terms of
listing (listing agreement).
    11. For additional listing applications only, transaction details,
including the purpose of the issuance, total security tokens, date of
board authorization, date of shareholder authorization and anticipated
date of issuance. This information is required of all applicants
listing additional security tokens on the Exchange, and is necessary in
order for the Exchange's regulatory staff to collect basic information
about the offering.
    12. For additional listing applications only, insider participation
and future potential issuances, including whether any director, officer
or principal shareholder of the company has a direct or indirect
interest in the transaction, and if the transaction potentially
requires the company to issue any security tokens in the future above
the amount they are currently applying for. This information is
required of all applicants listing additional security tokens on the
Exchange, and is necessary in order for the Exchange's regulatory staff
to collect basic information about the offering.
    13. For additional listing applications only, information for a
technical original listing, including reverse security token splits and
changes in states of incorporation. This information is required of all
applicants listing additional security tokens on the Exchange, and is