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Members of the Chicago Board Options Exchange will vote on its plan to convert to a shareholder-owned structure in early June, a pivotal event in the company's delayed trek toward an initial public offering.

CBOE executives are expected to hold additional meetings with seatholder-owners to rally support for the conversion after providing more details at a gathering Thursday.

The operator of the largest U.S. options exchange by volume also plans to hire a second adviser to help price the deal alongside Goldman Sachs & Co. Inc. (GS), for the proposed flotation in June.

Parent CBOE Holdings Inc. is moving toward a long-planned public float seen completing by the end of June, after settling a three-year legal dispute over ownership rights in December.

The company, which also runs trading platforms for stocks and futures, ranks as the last major member-owned exchange group to issue shares after a round of IPOs and consolidation reshaped the sector in the years prior to the financial crisis.

An early-June vote is being plotted as the CBOE structures its demutualization to occur almost simultaneously with its IPO, according to a notice sent to CBOE members Thursday.

The vote requires a majority of the CBOE's memberships to be voted in favor of the conversion, and demutualization will not be complete unless the IPO happens.

The CBOE seeks to win support for the transaction with a $93.2 million special dividend paid to seatholders upon approval of the demutualization, one way of compensating members for the income they receive from leasing out trading rights tied to the seats.

While some members had talked of pushing for a bigger payout, Thursday's meeting offered no signs of an increase, and members expect the transaction will be handily approved.

CBOE also detailed its intention to pay regular quarterly dividends to shareholders following the IPO, setting out an annual target of approximately 20% to 30% of the prior-year's net income adjusted for unusual items.

Goldman Sachs, which has served as CBOE's restructuring adviser since 2005, will remain the sole global coordinator of the float and will be paid out of proceeds from the IPO, according to the notice to CBOE members.

Seats at the CBOE, which are bought and sold on an open market that has offered a rough gauge for the company's indicative value, will cease to trade by the date of the IPO's pricing, according to the member notice.

A membership at the CBOE sold for $2.95 million last week immediately after the company filed IPO documents with securities regulators.

With 930 seats at the CBOE, the most recent seat sale provides an indicative value for the company of $2.74 billion, though estimates of the company's total value have ranged from $2 billion to $5 billion in recent months.

Resolution of the CBOE's legal dispute in late 2010 also revived takeover speculation, with a handful of potential acquirers seen in bigger exchange operators like crosstown neighbor CME Group Inc. (CME).

The notice also quoted exchange officials as declining comment on any interest from potential acquirers.

-By Jacob Bunge, Dow Jones Newswires; (312) 750 4117; jacob.bunge@dowjones.com

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