"The repurchase of these shares is another major milestone on the road to Nasdaq becoming an independent, investor-owned company," said Wick Simmons, Chairman and Chief Executive Officer of The Nasdaq Stock Market, Inc. "As an independent entity, we will continue to provide a highly liquid, efficient, well-regulated market. We plan to leverage our technology infrastructure, strong brand, and unique client relationships to achieve our vision of creating a global trading platform."
Nasdaq has repurchased the shares in two separate phases. In Phase I, Nasdaq repurchased 13.5 million shares of common stock in exchange for cash in a transaction that closed on February 21, 2002. Phase II of the repurchase closed on March 8, 2002, and encompassed the remaining 20.3 million shares of common stock in exchange for Nasdaq preferred shares and cash. Two new series of preferred stock were issued: 1.3 million shares of dividend-paying Series A non-voting stock and a single Series B share representing the NASD's continuing majority voting rights. The Series B preferred share will expire when Nasdaq is granted exchange registration status by the Securities and Exchange Commission and commences operation as a national securities exchange.
"The transaction further aligns Nasdaq with its shareholders," said Simmons. "It enables the company to focus on creating value through the development and release of new products and services worldwide."
Until Nasdaq is granted exchange registration, the NASD will continue to control the voting trust governing all warrants sold in the private placements. The warrants cover approximately 43.2 million shares of common stock and can be exercised over four years. If any warrants are not exercised, ownership of the shares would revert to the NASD.
The Nasdaq Stock Market lists over 4,000 companies and trades more shares per day than any other U.S. market. For more information about Nasdaq, visit the Nasdaq Web site at www.nasdaq.com or the Nasdaq NewsroomSM at www.nasdaqnews.com.
