News Release

Philadelphia Stock Exchange to Join NASD/AMEX Global "Market of Markets"

New York, NY and Philadelphia, PA, June 9, 1998 – The National Association of Securities Dealers (NASD), the American Stock Exchange (Amex) and the Philadelphia Stock Exchange (PHLX) today jointly announced their agreement in principle to add the Philadelphia Stock Exchange as a charter member to the proposed NASD/Amex family of companies. The PHLX, the first stock exchange in North America, is a marketplace for the trading of stocks, equity options, index options and currency options and has a proud tradition as a market leader in the development and introduction of innovative new products and services.

The proposed transaction is subject to the approval of a definitive agreement by the Boards of Governors of each organization, the Amex and PHLX memberships and appropriate regulatory authorities, including the Securities and Exchange Commission.

Frank G. Zarb, Chairman of NASD, said, "As a charter member of the new NASD/Amex family, the Philadelphia Stock Exchange would become an important part of a growing market alliance unparalleled in technology, expertise, information and product development to meet the needs of investors worldwide. This agreement is the result of discussions over the last few months involving the NASD and the Amex and represents the next significant step in creating a state-of-the-art Market of Markets to be built and operated on a global network."

Richard F. Syron, Chairman of Amex, said, "We are extremely excited about the Amex/PHLX combination and are confident we will be an extremely powerful competitive force, as part of the NASD/Amex family of companies. We fully expect that this combination will encourage investment, enhance the ability of companies to access financial resources, and assure timely, informed execution of investment decisions. Following CBOE’s 1997 acquisition of the NYSE options business, we believe this further consolidation of the industry is an outstanding opportunity."

John F. Wallace, Acting Chairman of the Philadelphia Stock Exchange, said, "As the nations’ fastest growing options exchange, we are excited at the prospect of joining with the NASD/Amex alliance as a charter member. This agreement clearly reflects our long-time commitment to innovation and responds to the ever-changing needs of the investment community. Through this combination, we will have the resources, state-of-the-art technologies and management strength to achieve a more efficient, transparent and low-cost market structure while strengthening our combined global position as member firms continue their worldwide expansion in equities and derivatives trading. We can preserve the best of the past and assure our strong future."

On behalf of the Amex Floor Governors, Anthony Boglioli said, "The Amex Floor is very excited about this new combination. We have worked closely with the NASD to develop a proposal for creating a world class options market place. This is an important next step in our continuing effort to create a more efficient and competitive trading environment for our customers."

The agreement in principle provides: (1) combining the best of the PHLX with the NASD/Amex technology; (2) operating PHLX’s trading facility in Philadelphia for up to five years; and (3) granting PHLX seatholders 12-year transferable trading permits to trade PHLX products as well as newly developed products. Additional terms addressing both the equities and options markets will be defined in the coming weeks.

Founded in 1790 as the first organized stock exchange in the United States, the Philadelphia Stock Exchange trades more than 2,800 stocks, 800 equity options, 13 index options and 100 currency pairs. On the equity floor, PHLX’s PACE (Philadelphia Automated Communication and Execution) system was one of the first automated equity trading systems on any exchange.

The American Stock Exchange is the only primary marketplace in the United States for both equities and derivative securities. The Amex trades more than 900 issues on its primary list. In the options market, the Amex trades options on 29 broad-based and sector indexes and 896 stocks and 103 Long-term Equity AnticiPation Securities (LEAPS). In addition, the Amex is a leader in listing warrants on foreign currencies and indexes as well as hybrid instruments and other structured products.

The National Association of Securities Dealers, Inc. is the largest securities industry self-regulatory organization in the United States. Through its subsidiaries, The Nasdaq Stock Market, Inc. and NASD Regulation, Inc., the NASD designs, operates and regulates securities markets and develops rules and regulations, provides a dispute resolution forum and conducts regulatory reviews of member activities, all for the benefit and protection of the investor.