Notice to Members 98-55

Transaction Reporting and Quotation Obligations Under the Fixed Income Pricing System (FIPS)

On April 11, 1994, The Nasdaq Stock Market, Inc., began operation of the Fixed Income Pricing SystemSM (FIPS®) for members trading high-yield bonds. FIPS was created to facilitate the over-the-counter (OTC) trading of high-yield, corporate debt securities rated BB+ or lower by Standard & Poor’s Corporation. The goals in the creation of FIPS were similar to those which led to the creation of The Nasdaq Stock Market®—to increase information and transparency in the marketplace, thereby encouraging investment and growth. As the list of bonds requiring FIPS reporting continues to expand, members are reminded of their reporting and quotation obligations.