Self-Regulatory Organizations; NYSE Texas, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Bylaws of the Exchange

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<title>Federal Register, Volume 91 Issue 210 (Monday, November 2, 2026)</title>
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[Federal Register Volume 91, Number 210 (Monday, November 2, 2026)]
[Notices]
[Pages 69005-69008]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-22260]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106752; File No. SR-NYSETEX-2026-38]


Self-Regulatory Organizations; NYSE Texas, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the Bylaws 
of the Exchange

October 28, 2026.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on October 15, 2026, the NYSE Texas, Inc. (``NYSE Texas'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the title, Article II, Sections 1, 2 
and 3, Article IV, Section 7, and Article IX, Section 1, of the bylaws 
of the Exchange to (a) replace the term ``Permit Holders'' with 
``Participants,'' (b) clarify the definition of ``Participant,'' (c) 
remove the requirement that the fair representation director be a 
Participant, and (d) make a conforming change. The proposed rule change 
is available on the Exchange's website at <a href="http://www.nyse.com">www.nyse.com</a> and at the 
principal office of the Exchange.

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 those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the title, Article II, Sections 1 
(Powers), 2 (General Composition and Term of Office) and 3 (Nomination 
and Election), Article IV, Section 7 (Nominating Committee), and 
Article IX, Section 1 (Management of the Corporation), of the bylaws of 
the Exchange to (a) replace the term ``Permit Holders'' with 
``Participants,'' (b) clarify the definition of ``Participant,'' (c) 
remove the requirement that the fair representation director be a 
Participant, and (d) make a conforming change.
Replacing Permit Holders With Participants
    The Exchange Act requires that every exchange have rules that 
``assure a fair representation of its members in the selection of its 
directors and administration of its affairs''.\4\ In compliance with 
this requirement, the Exchange's bylaws set forth the process by which 
its fair representation directors, the ``Non-Affiliated Directors,'' 
are chosen.
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    \4\ 15 U.S.C. 78f(b)(3).
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    Currently, the bylaws provide that Permit Holders nominate the Non-
Affiliated Directors, may submit a different candidate, vote on 
contested nominations for Non-Affiliated Directors, and serve on the 
Nominating Committee.\5\ ``Permit Holders'' are defined as ``trading 
permit holders who are permitted to trade on the [Exchange]'s 
facilities for the trading of equities that are securities as covered 
by the Exchange Act.'' \6\
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    \5\ The Nominating Committee is appointed by the board of 
directors. See Bylaws of NYSE Texas, Inc., Article IV, Section 2 
(Appointment; Vacancies; and Removal). Currently Permit Holder 
representatives and Non-Affiliated Directors may serve on the 
Nominating Committee. See Bylaws of NYSE Texas, Inc., Article IV, 
Section 7 (Nominating Committee).
    \6\ Bylaws of NYSE Texas, Inc., Article II, Section 2.
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    The Exchange recently made a filing to add a new membership 
category known as ``Limited Underwriting Members.'' Limited 
Underwriting Members are a type of non-trading Exchange membership 
solely for the limited purpose of acting as a principal underwriter of 
an underwritten public offering.\7\ As such, they do not have trading 
permits, and so are not Permit Holders, but are members under the 
Exchange Act.\8\
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    \7\ See Securities Exchange Act Release No. 104899 (February 26, 
2026), 91 FR 10425 (March 9, 2026) (SR-NYSETex-2026-06) (Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change 
Establishing Limited Underwriting Members).
    \8\ See id. at note 10. The filing stated that ``Limited 
Underwriting Members would be `members' of a national securities 
exchange under the [Exchange] Act based on their agreement to be 
regulated by the Exchange in connection with underwriting 
activity.''
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    Accordingly, to ensure that all ``members'' (as defined in the 
Exchange Act) have ``fair representation . . . in the selection of its 
directors and administration of its affairs'' \9\ the Exchange proposes 
to amend Article II, Sections 1, 2 and 3, and Article IV, Section 7 of 
the bylaws of the Exchange in order to replace references to ``Permit 
Holders'' with ``Participants.''
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    \9\ 15 U.S.C. 78f(b)(3).
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    The proposed changes would make the bylaws consistent with the New 
York Stock Exchange LLC, an affiliate of the Exchange, which does not 
require a member be a permit holder in order to participate in the 
selection of fair representation directors.\10\
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    \10\ See Fourteenth Amended and Restated Operating Agreement of 
the New York Stock Exchange, Article II, Section 2.03(a)(iv) and 
(v).
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Definition of Participant
    Currently, ``Participant'' is defined twice: in Article II, Section 
1 as an ``individual, corporation, partnership or

[[Page 69006]]

other entity that holds a permit issued by the [Exchange] to trade 
securities on the market operated by the [Exchange]''; and in Article 
IX, Section 1, as a ``member[ ], as that term is defined in Section 3 
of the Exchange Act''.
    The Exchange believes that these definitions are consistent, but 
for the avoidance of doubt and in case they become inconsistent, it 
proposes to replace the first definition with the second (and remove 
the definition from Article IX, Section 1). At the same time, it 
proposes to remove the reference to Section 3 of the Exchange Act and 
simply provide that ``Participant'' means ``any member as defined in 
the Exchange Act.''
Nominating Committee
    The Exchange proposes to remove the requirement, in the first 
sentence of Article II, Section 3(b), that the Nominating Committee 
publish the name of a Participant as its nominee for Non-Affiliated 
Director. Rather, it would be able to name the individual of its choice 
as its nominee.
    Currently, the Nominating Committee is limited to someone who is 
currently a Participant. For example, the Nominating Committee cannot 
name someone who was until recently, but is not at present, a 
Participant. The proposed change would give the Nominating Committee 
more options: they still could name a Participant but could name 
another person as well.
    The proposed change would be consistent with the New York Stock 
Exchange LLC and NYSE American LLC, affiliates of the Exchange, which 
have no equivalent requirement.\11\ The Exchange notes that the 
proposed change also would be consistent with the governing documents 
of other self-regulatory organizations, such as the Nasdaq Stock Market 
LLC \12\ and CBOE BYX Exchange, Inc.\13\
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    \11\ See id., Article II, Section 2.03, and Thirteenth Amended 
and Restated Operating Agreement of NYSE American LLC, Article II, 
Section 2.03. See also Securities Exchange Act Release No. 87914 
(January 8, 2020), 85 FR 2191 (January 14, 2020) (SR-NYSE-2019-62) 
(Order Approving Proposed Rule Change To Amend Article II, Section 
2.03 of the Twelfth Amended and Restated Operating Agreement of the 
Exchange To Remove the Independence Requirement for the Director 
Elected by Exchange Membership Organizations).
    \12\ See Bylaws of the Nasdaq Stock Market LLC, Article I 
(noting that a ``Member Representative Director may, but is not 
required to be, an officer, director, employee, or agent of a Nasdaq 
Member'').
    \13\ See Ninth Amended and Restated Bylaws of CBOE BYX Exchange, 
Inc., Article III, Sections 3.1 and 3.2.
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Non-Substantive Change
    The Exchange proposes to make a non-substantive technical and 
conforming change to the title, to add ``First Amended and Restated'' 
to it.
Proposed Changes
    The Exchange proposes to make the following changes (proposed 
additions italicized, proposed deletions in brackets):
    <bullet> Article II, Section 1 would be amended to read as follows:
    The business and affairs of the Corporation shall be managed by its 
Board of Directors. The Board of Directors, acting in accordance with 
the terms of these bylaws and the rules of the Corporation (``rules''), 
shall be vested with all powers necessary for the governing of the 
Corporation as an ``exchange'' within the meaning of the Securities 
Exchange Act of 1934, as amended (the ``Exchange Act''), the regulation 
of the business conduct of any member as defined in the Exchange 
Act[individual, corporation, partnership or other entity that holds a 
permit issued by the Corporation to trade securities on the market 
operated by the Corporation] (each, a ``Participant''), and the 
promotion of the welfare, objects and purposes of the Corporation.
    <bullet> Article II, Section 2(a) would be amended to read as 
follows:
    Subject to Section 2(b), the Board shall consist of a number of 
directors (``Directors'') as determined from time to time by the 
stockholders; provided that (1) at least fifty percent (50%) of the 
directors will be persons from the public and will not be, or be 
affiliated with, a broker-dealer in securities or employed by, or 
involved in any material business relationship with, the Corporation or 
its affiliates (``Public Directors''); and (2) at least twenty percent 
(20%) of the directors shall consist of individuals nominated by the 
[trading permit holders who are permitted to trade on the Corporation's 
facilities for the trading of equities that are securities as covered 
by the Exchange Act (collectively, such individuals ``Permit 
Holders'')]Participants (such directors, ``Non-Affiliated Directors''). 
For purposes of calculation of the minimum number of Non-Affiliated 
Directors, if 20 percent of the Directors is not a whole number, such 
number of Directors to be nominated and selected by the [Permit 
Holders]Participants will be rounded up to the next whole number. The 
term of office of a director shall not be affected by any decrease in 
the authorized number of directors.
    <bullet> Article II, Section 3(b) and (c) would be amended to read 
as follows:
    (b) The Nominating Committee shall publish the name(s) of one or 
more [Participants]individuals as its nominee(s) for Non-Affiliated 
Directors of the Board of Directors of the Corporation. A director 
shall qualify as a Public Director or Non-Affiliated Director only so 
long as such director meets the requirements for that position. The 
Nominating Committee shall name sufficient nominees so that at least 
twenty percent (20%) of the Directors consist of Non-Affiliated 
Directors. The names of the nominees shall be published on a date in 
each year (the ``Announcement Date'') sufficient to accommodate the 
process described in this Section 3(b). After the name of proposed 
nominee(s) is published, [Permit Holders]Participants in good standing 
may submit a petition to the Corporation in writing to nominate 
additional eligible candidate(s) to fill Non-Affiliated Director 
position(s) during the next term. If a written petition of at least 10 
percent of [Permit Holders]Participants in good standing is submitted 
to the Nominating Committee within two weeks after the Announcement 
Date, such person(s) shall also be nominated by the Nominating 
Committee; provided, however, that no [Permit Holders]Participants, 
either alone or together with other [Permit Holders]Participants that 
are deemed its affiliates, may account for more than 50% of the 
signatories to the petition endorsing a particular petition nominee for 
the Non-Affiliated Director position(s) on the Board of Directors of 
the Corporation. Each petition for a petition candidate must include a 
completed questionnaire used to gather information concerning director 
candidates (the Corporation shall provide the form of questionnaire 
upon the request of any [Permit Holder]Participant). Notwithstanding 
anything to the contrary, the Nominating Committee shall determine 
whether any petition candidate is eligible to serve on the Board of 
Directors (including whether such person is free of any statutory 
disqualification (as defined in section 3(a)(39) of the Exchange Act)), 
and such determination shall be final and conclusive.
    (c) In the event that the number of nominees exceeds the number of 
available seats, the Nominating Committee shall submit the contested 
nomination to the [Permit Holders]Participants for selection. [Permit 
Holders]Participants shall be afforded a confidential voting procedure 
and shall be given no less than 20 calendar days to submit their votes. 
Each [Permit Holder]Participant in good standing may select one nominee 
for the

[[Page 69007]]

contested seat on the Board of Directors; provided, however that no 
[Permit Holder]Participant, either alone or together with other [Permit 
Holders]Participants who are deemed its affiliates, may account for 
more than 20% of the votes cast for a particular nominee for the Non-
Affiliated Director position(s) on the Board of Directors of the 
Corporation. With respect to the contested position, the nominee for 
the Board of Directors receiving the most votes of [Permit 
Holders]Participants shall be submitted by the Nominating Committee to 
the Board of Directors of the Corporation. Similarly, the Nominating 
Committee shall submit uncontested nominees to the Board of Directors. 
Tie votes shall be decided by the Board of Directors at its first 
meeting following the election.
    <bullet> Article IV, Section 7 would be amended to read as follows:
    The Nominating Committee shall consist solely of Non-Affiliated 
Directors, as defined above, and/or [Permit Holder]Participant 
representatives, and shall be responsible for approving and submitting 
names of candidates for election to the position of Non-Affiliated 
Director pursuant to, and in accordance with, Article II, Section 3. 
``[Permit Holder]Participant representative'' shall mean an officer, 
director, employee or agent of a [Permit Holder]Participant.
    <bullet> Article IX, Section 1 would be amended to read as follows:
    In connection with managing the business and affairs of the 
Corporation, the Board of Directors shall consider applicable 
requirements for registration as a national securities exchange under 
Section 6(b) of the Exchange Act, including, without limitation, the 
requirements that (a) the rules of the Corporation shall be designed to 
protect investors and the public interest and (b) the Corporation shall 
be so organized and have the capacity to carry out the purposes of the 
Exchange Act and to enforce compliance by its [members, as that term is 
defined in Section 3 of the Exchange Act (such statutory members being 
referred to in the Corporation's bylaws and rules as 
``]Participants['')] and persons associated with Participants, with the 
provisions of the Exchange Act, the rules and regulations under the Act 
and the rules of the Corporation.
    The title would be amended by adding ``First Amended and Restated'' 
to it.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Exchange Act,\14\ in general, and furthers the 
objectives of Section 6(b)(1) \15\ in particular, in that it enables 
the Exchange to be so organized as to have the capacity to be able to 
carry out the purposes of the Exchange Act and to comply, and to 
enforce compliance by its exchange members and persons associated with 
its exchange members, with the provisions of the Exchange Act, the 
rules and regulations thereunder, and the rules of the Exchange. The 
Exchange believes that the proposed rule change is consistent with 
Section 6(b)(3) of the Exchange Act,\16\ in that it would ensure a fair 
representation of its members in the selection of its directors and 
administration of its affairs. The Exchange also believes that the 
proposed rule change is consistent with Section 6(b)(5) of the Exchange 
Act,\17\ in that it is designed to prevent fraudulent and manipulative 
acts and practices, to promote just and equitable principles of trade, 
to foster cooperation and coordination with persons engaged in 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system and, in general, to protect investors and the public interest.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(1).
    \16\ 15 U.S.C. 78f(b)(3).
    \17\ 15 U.S.C. 78f(b)(5).
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    The proposed rule changes replacing ``Permit Holders'' with 
``Participants,'' conforming the definition of ``Participants,'' and 
removing limitations on who can be named by the Nominating Committee 
(collectively, the ``Proposed Changes'') would enable the Exchange to 
be so organized as to have the capacity to be able to carry out the 
purposes of the Exchange Act and ensure a fair representation of its 
members in the selection of its directors and administration of its 
affairs because they would ensure that all members are equal in 
selecting its Non-Affiliated Directors, whether or not they have a 
trading permit. The Proposed Changes would allow the Nominating 
Committee to name the individuals of its choice as its nominees and not 
be limited to individuals that are currently Participants.
    The Proposed Changes would allow the Exchange to ensure that all 
``members'' (as defined in the Exchange Act) have ``fair representation 
. . . in the selection of its directors and administration of its 
affairs'' \18\ by including member organizations that do not have 
trading permits. The Proposed Changes would allow the Exchange to 
ensure that it remains in compliance with the cited Exchange Act 
requirement and make the bylaws consistent with the rules of the 
Exchange.
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    \18\ 15 U.S.C. 78f(b)(3).
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    The Proposed Changes would make the bylaws consistent with the New 
York Stock Exchange LLC, an affiliate of the Exchange, as it does not 
require a member be a permit holder in order to participate in the 
selection of fair representation directors \19\ and neither the New 
York Stock Exchange LLC nor NYSE American LLC require their nominating 
committees to limit their nominees.\20\
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    \19\ See note 10, supra.
    \20\ See note 11, supra.
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    The proposed rule change to the title and moving up the definition 
of ``Participants'' (the ``Non-Substantive Changes'') are non-
substantive changes that do not impact the governance or ownership of 
the Exchange. The Exchange believes that the proposed Non-Substantive 
Changes would enable the Exchange to continue to be so organized as to 
have the capacity to carry out the purposes of the Exchange Act and 
comply and enforce compliance with the provisions of the Exchange Act 
by its members and persons associated with its members, because making 
the Non-Substantive Changes would contribute to the orderly operation 
of the Exchange by adding clarity and transparency to its rules.
    Further, the Exchange believes that the proposed rule change would 
remove impediments to and perfect the mechanism of a free and open 
market and a national market system and, in general, protect investors 
and the public interest. The Proposed Changes would make the bylaws 
consistent with the rules of the Exchange and therefore would ensure 
that market participants can more easily navigate, understand and 
comply with the governing documents of the Exchange. he proposed Non-
Substantive Changes would ensure that market participants can more 
easily navigate, understand and comply with the governing documents of 
the Exchange. The proposed rule changes would therefore reduce 
potential investor or market participant confusion.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Exchange Act. The proposed rule 
change is not

[[Page 69008]]

intended to address competitive issues but rather is concerned solely 
with making the bylaws consistent with the rules of the Exchange and 
making non-substantive changes to the bylaws.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \21\ and Rule 19b-4(f)(6) thereunder.\22\ 
Because the proposed rule change does not: (i) significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.\23\
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    \21\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \22\ 17 CFR 240.19b-4(f)(6).
    \23\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \24\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \24\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

    <bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#e391968f86ce808c8e8e868d9790a3908680cd848c95"><span class="__cf_email__" data-cfemail="592b2c353c743a3634343c372d2a192a3c3a773e362f">[email&#160;protected]</span></a>. Please include 
file number SR-NYSETEX-2026-38 on the subject line.

Paper Comments

    <bullet> Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-NYSETEX-2026-38. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and 
copying at the principal office of the Exchange. Do not include 
personal identifiable information in submissions; you should submit 
only information that you wish to make available publicly. We may 
redact in part or withhold entirely from publication submitted material 
that is obscene or subject to copyright protection. All submissions 
should refer to file number SR-NYSETEX-2026-38 and should be submitted 
on or before November 23, 2026.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\25\
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    \25\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-22260 Filed 10-30-26; 8:45 am]
BILLING CODE 8011-01-P


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