Self-Regulatory Organizations; Notice of Filing of Proposed Rule Change by the Philadelphia Stock Exchange, Inc., Relating to By-Law Articles IX and X Respecting the Trustees of the Stock Exchange Fund and the Executive Committee

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-34567; File No. SR-PHLX-94-36]

Self-Regulatory Organizations; Notice of Filing of Proposed Rule

Change by the Philadelphia Stock Exchange, Inc., Relating to By-Law

Articles IX and X Respecting the Trustees of the Stock Exchange Fund

and the Executive Committee

August 19, 1994.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act''), 15 U.S.C. 78s(b)(1), notice is hereby given that on July 9,

1994, the Philadelphia Stock Exchange, Inc. (``PHLX'' or ``Exchange'')

filed with the Securities and Exchange Commission (``SEC'' or

``Commission'') the proposed rule change as described in Items I, II

and III below, which Items have been prepared by the self-regulatory

organization. The Commission is publishing this notice to solicit

comments on the proposed rule change from interested persons.

I. Self-Regulatory Organization's Statement of the Terms of

Substance of the Proposed Rule Change

Currently, Section 9-1, ``Trustees of Stock Exchange Fund--How

Appointed'' of Article IX, ``Trustees of Stock Exchange Fund'' of the

Exchange's By-Laws requires that the trustees of the Stock Exchange

Fund (``Fund'') include the Chairman of the Exchange's Board of

Governors, two Vice Chairmen of the Board of Governors and up to five

other Exchange members, all of whom are appointed by the Exchange's

Board of Governors and serve for three years or until a successor is

appointed. The PHLX proposes to amend Section 9-1 to allow two members

of the Exchange's Board of Governors, rather than two Vice Chairmen, to

serve as trustees of the Fund and to allow qualified non-members to

serve as trustees. In addition, the PHLX proposes to amend Section 10-

13, ``Executive Committee,'' of By-Law Article X, ``Standing

Committees,'' to delete the requirement that the Executive Vice

President of the Exchange serve on the Exchange's Executive Committee.

The text of the proposed rule change is available at the Office of

the Secretary, PHLX, and at the Commission.

II. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

In its filing with the Commission, the self-regulatory organization

included statements concerning the purpose of and basis for the

proposed rule change and discussed any comments it received on the

proposed rule change. The text of these statements may be examined at

the places specified in Item IV below. The self-regulatory organization

has prepared summaries, set forth in sections (A), (B), and (C) below,

of the most significant aspects of such statements.

(A) Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

The PHLX states that the proposal to amend By-Law Article IX,

Section 9-1 will give the Exchange's Board of Governors more

flexibility in choosing trustees of the Fund by eliminating the

requirement that all trustees be Exchange members or affiliated with

member organizations. Under the proposal, the Board of Governors will

be able to choose qualified persons with investment management

expertise regardless of their status respecting Exchange membership or

affiliation.

The proposed amendment will also eliminate the requirement that the

Exchange's Vice Chairmen serve as Fund trustees, to ease the

administrative burdens currently imposed upon the Vice Chairmen. The

proposal retains the Board of Governors' oversight of the trustees by

continuing to require the Chairman of the Board of Governors to be a

trustee and by imposing a new requirement that two other members of the

Board of Governors be trustees.

The proposed amendment to By-Law Article X, Section 10-13 deletes

the Executive Vice President of the PHLX from membership on the

Exchange's Executive Committee. The PHLX states that the Exchange's

management will continue to be represented on the Executive Committee

by the Exchange's President and Chief Executive Officer.

The PHLX believes that the proposal is consistent with section 6 of

the Act, in general, and, in particular with Section 6(b)(3), in that

it is designed to assure a fair representation of the Exchange's

members in the administration of its affairs and to provide that one or

more Fund trustees may be representatives not associated with a member

of the Exchange.\1\

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\1\Telephone conversation between Murray L. Ross, Secretary,

PHLX, and Yvonne Fraticelli, Attorney, Options Branch, Division of

Market Regulation, Commission, on July 27, 1994.

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(B) Self-Regulatory Organization's Statement on Burden on Competition

The PHLX does not believe that the proposed rule change will impose

any burden on competition.

(C) Self-Regulatory Organization's Statement on Comments on the

Proposed Rule Change Received from Members, Participants or Others

As a proposed By-Law change, the Exchange solicited comment from

its membership by Circular 94-79, dated May 19, 1994. Receiving none,

the Exchange Board of Governors approved the proposal for submission to

the Commission.

III. Date of Effectiveness of the Proposed Rule Change and Timing

for Commission Action

Within 35 days of the date of publication of this notice in the

Federal Register or within such longer period (i) as the Commission may

designate up to 90 days of such date if it finds such longer period to

be appropriate and publishes its reason for so finding or (ii) as to

which the self-regulatory organization consents, the Commission will:

(a) by order approve such proposed rule change, or

(b) institute proceedings to determine whether the proposed rule

change should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and

arguments concerning the foregoing. Persons making written submissions

should file six copies thereof with the Secretary, Securities and

Exchange Commission, 450 Fifth Street, N.W., Washington, DC 20549.

Copies of the submission, all subsequent amendments, all written

statements with respect to the proposed rule change that are filed with

the Commission, and all written communications relating to the proposed

rule change between the Commission and any person, other than those

that may be withheld from the public in accordance with the provisions

of 5 U.S.C. 552, will be available for inspection and copying at the

Commission's Public Reference Section, 450 Fifth Street, N.W.,

Washington, DC. Copies of such filing will also be available for

inspection and copying at the principal office of the above-mentioned

self-regulatory organization. All submissions should refer to the file

number in the caption above and should be submitted by September 16,

1994.

For the Commission, by the Division of market Regulation,

pursuant to delegated authority.\2\

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\2\17 CFR 200.30-3(a)(12) (1993).

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Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-21059 Filed 8-25-94; 8:45 am]

BILLING CODE 8010-01-M