Securities and Exchange Commission to Consider
Chicago, November 11, 2004 – Holders of the Chicago Stock Exchange’s (CHX) memberships voted today in favor of a plan to demutualize the Exchange. The vote was 314 in favor, 1 against and 1 abstention. The US Securities and Exchange Commission (SEC) will now consider the plan for approval. This decision by the CHX’s members to demutualize cannot take effect until approved by the SEC.
In this demutualization transaction, the CHX will change its organizational structure from a not-for-profit, non-stock corporation owned by its members to become a wholly-owned subsidiary of a holding company, CHX Holdings, Inc., which is to be organized as a for-profit, stock corporation owned by its stockholders. The members of CHX at the time of the demutualization transaction will receive shares of common stock of the new holding company in exchange for their CHX memberships, and thus will become the stockholders of the new holding company. Those members who are qualified to trade on the Exchange at the time of the demutualization will receive trading permits that give them continued access to the Exchange’s trading facilities.
Valerie Jarrett, CHX Chairman, said, "This strong vote of confidence by our members positions the Chicago Stock Exchange to take advantage of opportunities in the market place."
Dave Herron, CHX’s Chief Executive Officer, commented, "Membership approval of demutualization shows the confidence CHX members have in the continued value of this institution to the US Capital Markets. In a rapidly evolving securities industry this move is an essential step toward ensuring that CHX customers and owners continue to be vital force within the National Market System. "
Andrew Davis, CHX Vice-Chairman, said, "We the members of The Chicago Stock Exchange overwhelmingly supported this important step in our strategic plan. We believe that as a for profit stock company we will more easily make the decisions which meet the needs of the rapidly evolving electronic market place for US equities."
The Chicago Stock Exchange was founded May 15, 1882. The CHX is a strong force for competition to all U.S. markets. The CHX trades more than 3,500 NYSE, AMEX, NASDAQ and CHX-exclusive issues.