September 23, 2005
Exchange
Bulletin
Volume 33, Number 38
The Constitution and Rules of the Chicago Board Options Exchange, Incorporated (“Exchange”), in certain specific instances,
require the Exchange to provide notice to the Exchange membership. To satisfy this requirement, a complimentary copy of the
Exchange Bulletin, including the Regulatory Bulletin, is delivered by hard copy or e-mail to all effective members on a weekly
basis.
CBOE members are encouraged to receive the Exchange and Regulatory Bulletin and Information Circulars via e-mail. E-mail
subscriptions may be obtained by submitting your name, firm if applicable, mailing address, e-mail address, and phone number, to
members@cboe.com, or, by contacting the Membership Department by phone, at 312-786-7449. There is no charge for e-mail
delivery of the Exchange and Regulatory Bulletin or for Information Circulars. If you do sign up for e-mail delivery, please remember to inform the Membership Department of e-mail address changes.
Additional subscriptions for hard copy delivery after the first complimentary copy may be obtained by submitting your name, firm
if any, mailing address, e-mail address and telephone number to: Chicago Board Options Exchange, Accounting Department, 400
South LaSalle, Chicago, Illinois 60605, Attention: Bulletin Subscriptions. The cost of an annual subscription (January 1 through
December 31) is $200.00 ($100.00 after July 1), payable in advance. The Exchange reserves the right to limit subscriptions by nonmembers.
For up-to-date Seat Market Quotes, call 312-786-7456 or refer to CBOE.com and click “Seat Market Information” under the “About
CBOE” tab. For access to the CBOE Member Web Site, please also notify the Membership Department by sending an e-mail to
members@cboe.com or by phone at 312-786-7449.
Copyright © 2005 Chicago Board Options Exchange, Incorporated
SEAT MARKET QUOTES AS OF FRIDAY, SEPTEMBER 16, 2005
CLASS
CBOE
BID
$625,000.00
OFFER
LAST SALE AMOUNT
$650,000.00
$675,000.00
LAST SALE DATE
September 14, 2005
CBOT FULL MEMBERSHIP
CLASS
With CBOE Exercise Right
Without CBOE Exercise Right
CBOE Exercise Right
BID
OFFER
$2,025,000.00
$2,150,000.00
$0.00
$0.00
$10,000.00
$100,000.00
LAST SALE AMOUNT
$2,100,000.00
N/A
$104,000.00
LAST SALE DATE
September 23, 2005
June 20, 2005
August 17, 2005
Page 2
September 23, 2005
Volume 33, Number 38
Chicago Board Options Exchange
Information Circular IC05-127
Date:
September 20, 2005
To:
Membership
From:
Nominating Committee
Re:
Persons Who Have Submitted Their Names to Be Considered for Nomination to Board of Directors and
Nominating Committee
For each annual election, the Nominating Committee selects nominees to fill expiring terms on the Board of Directors and
Nominating Committee. To date, the individuals listed below have submitted their names to the Nominating Committee to be
considered for nomination to fill these positions for the 2005 annual election.
A candidate is required to satisfy the qualification criteria for the applicable position at the time of the Nominating Committee slating meeting (currently scheduled for September 29, 2005) in order to be considered for nomination. Any candidate that
does not currently satisfy the qualification criteria may take steps to qualify before that time. A notation is included below after the
name of each candidate indicating whether that candidate currently satisfies the applicable qualification criteria (denoted with a Q),
does not currently satisfy the applicable qualification criteria (denoted with an N), or is being reviewed to determine whether or not
the candidate currently satisfies the applicable qualification criteria (denoted with an R).
Board of Directors
Floor Director
Edward Tilly (Q)
Richard Tobin (Q)
Lessor Director
William Power (Q)
Robert Silverstein (Q)
Christopher Wheaton (Q)
Public Director
James Boris (Q)
Carole Stone (Q)
Eugene Sunshine (Q)
Mark Zurack (Q)
Nominating Committee
Firm Member
Peter Bottini (Q)
Floor Member
Dennis Carta (Q)
Richard Fuller (Q)
Sean Haggerty (Q)
Lessor Member
Jeffrey Kirsch (Q)
Public Member
J. Douglas Gray (Q)
Page 3
September 23, 2005
Volume 33, Number 38
Chicago Board Options Exchange
MEMBERSHIP INFORMATION FOR 9/15/05 THROUGH 9/21/05
MEMBERSHIP APPLICATIONS RECEIVED FOR Nominee(s) / Inactive Nominee(s):
WHICH A POSTING PERIOD IS REQUIRED
Individual Membership Applicants
Date Posted
Andrew W. Smyth Jr., Nominee
Sparta Group Of Chicago, LP
2941 N. Broadway St. - Apt. #3
Chicago, IL 60657
9/20/05
Member Organization Applicants
Date Posted
Sentinel Capital Management LLC
440 S. LaSalle - Suite 713
Chicago, IL 60605
John T. Lundy – Managing Member
9/21/05
Termination Date
Steve H. Kats (CAT)
Bear Wagner Specialists LLC
141 W. Jackson, Ste. 4131
Chicago, IL 60605
9/15/05
John A. Vinci (VNC)
Everest Trading, LLC
440 S. LaSalle - Ste. 3100
Chicago, IL 60605
9/19/05
EFFECTIVE MEMBERSHIPS
Individual Members
CBT Registered For:
Brian Ludden LLC
9/20/05
David A. Ludden, Nominee
Brian F. Ludden, Nominee
Jeffrey D. Gehrke, Nominee
2775 N. Kenmore
Chicago, IL 60614
David A. Ludden – Managing Member
Brian F. Ludden – Managing Member
MEMBERSHIP LEASES
New Leases
Effective Date
Lessor: John T. Lundy
Lessee: SLK-Hull Derivatives LLC
Rate:
1.2393%
Term: Monthly
9/16/05
Lessor: William R. Power
Lessee: Westward Capital LLC
Rate:
1.2393%
Term: Monthly
9/20/05
Terminated Leases
Termination Date
Effective Date
Richard A. Kenna (KNA)
9/16/05
Nomura Securities International Inc.
77 W. Wacker Dr., Suite 700
Chicago, IL 60601
Type of Business to be Conducted: No Trading Functions
Nominee(s) / Inactive Nominee(s):
Effective Date
John E. Andrie (JEA)
9/20/05
Andrie Trading LLC
440 S. LaSalle, 19th Flr.
Chicago, IL 60605
Type of Business to be Conducted: Market Maker
JOINT ACCOUNTS
New Participants
Acronym
Effective Date
Timothy Cody
QHG
9/21/05
New Accounts
Acronym
Effective Date
Lessor: Mark D. Rothschild
9/16/05
Lessee: Geneva Capital Investments LLC
Matthew M. Koenig (KNG), NOMINEE
Timothy McGugan
QGG
9/20/05
Matthew Peters
QGG
9/20/05
Lessor: David Schorvitz LLC
Lessee: SLK-Hull Derivatives LLC
Steven Stefancic
QGG
9/20/05
Jonathan Coe
QGG
9/20/05
Paul Aronson
QGG
9/20/05
Matthew Koenig
QGG
9/20/05
9/16/05
MEMBERSHIP TERMINATIONS
Individual Members
CBT Registered For:
Termination Date
Brian Dowling
QGG
9/20/05
Susan C. Bannon (TSU)
Cutler Group, LP
2241 N. Dayton, Ste. #3
Chicago, IL 60614
9/16/05
Michael Giangorgi
QGG
9/20/05
John Homan
QGG
9/20/05
Lessor(s):
Termination Date
Mark D. Rothschild
3803 26th St.
Boulder, CO 80304
9/16/05
Terminated Participants Acronym
Termination Date
John A. Vinci
QBM
9/19/05
John A. Vinci
QER
9/19/05
John A. Vinci
QHC
9/19/05
John A. Vinci
QJV
9/19/05
Page 4
September 23, 2005
Volume 33, Number 38
Chicago Board Options Exchange
CHANGES IN MEMBERSHIP STATUS
Individual Members
Effective Date
Richard E. Tobin
9/16/05
From:
Nominee For Ronin Capital, LLC; Market Maker
To:
Lessor/ Nominee For Ronin Capital, LLC; Market Maker
Timothy Cody
9/21/05
From:
CBT Registered For HGI, Inc.; Floor Broker
To:
CBT Registered For HGI, Inc.; Market Maker/ Floor
Broker
Member Organizations
Effective Date
Archelon LLC
9/21/05
From:
Lessee/ Member Organization Affiliated with a CBT
Registered For; Associated with a Market Maker
To:
Lessee; Associated with a Market Maker
Everest Trading, LLC
9/20/05
From:
Lessee/ Member Organization Affiliated with a CBT
Registered For; Associated with a Market Maker
To:
Lessee/ Member Organization Affiliated with a CBT
Registered For; Associated with a Market Maker/
Remote Market Maker
Andrie Trading LLC
9/20/05
From:
Lessor/ Owner/ Lessee/ Member Organization
Affiliated with a CBT Registered For; Associated with
a Market Maker
To:
Owner/ Lessee/ Member Organization Affiliated with a
CBT Registered For; Associated with a Market Maker
Bear Wagner Specialists LLC
9/15/05
From:
Owner; Associated with a Market Maker/ Floor Broker
To:
Lessor
MEMBER ADDRESS CHANGES
Individual Members
Effective Date
Charles Floyd Thompson Jr.
808 Sunset Rd.
Winnetka, IL 60093
9/16/05
Brandon Purcell
110 Sullivan Street – Apt. 2C
New York , New York 10012-3608
9/16/05
Effective Date
Trevor Wenberg
175 W. Jackson, Suite 1650
Chicago, IL 60604
9/16/05
Aaron Wahls
1309 N. Wells, #705
Chicago, IL 60610
9/19/05
Charles A. Maylee
141 W. Jackson, Suite 3310
Chicago, IL 60604
9/19/05
Darryl A. Behm
141 W. Jackson, Suite 3310
Chicago, IL 60604
9/19/05
Timothy Gray
230 S. LaSalle, Ste. 400
Chicago, IL 60604
9/20/05
Jeffrey J. Kupets
440 S. LaSalle, Suite 3100
Chicago, IL 60605
9/21/05
Thomas C. Bruno
175 W. Jackson, Suite 1650
Chicago, IL 60604
9/21/05
Daniel W. Murphy
175 W. Jackson, Suite 1650
Chicago, IL 60604
9/21/05
John V. Nash
175 W. Jackson, Suite 1650
Chicago, IL 60604
9/21/05
Member Organizations
Effective Date
Resource Equities LLC
175 W. Jackson, Ste. 1650
Chicago, IL 60604
9/21/05
UBS Securities LLC
1285 Avenue of the Americas
New York, NY 10019
9/21/05
POSITION LIMIT CIRCULARS
Pursuant to Exchange Rule 4.11, the Exchange issued the below listed Position Limit Circulars on September 23, 2005. The complete circulars are
available from the Department of Market Regulation, in the data information bins on the 2nd Floor of the Exchange, and on the CBOE website at
cboe.com under the “Market Data” tab.
To receive regular updates of the position limit list via fax, contact Candice Nickrand at (312) 786-7730. Questions concerning position and exercise
limits may be directed to the Department of Market Regulation to Dan Earner at (312) 786-7059 or Tim Mac Donald at (312) 786-7706.
Position Limit Circular PL05-043
September 23, 2005
Equity Position and Exercise Limits will
be decreased to a Lower Tier Limit
Effective October 24, 2005
Position Limit Circular PL05-44
September 23, 2005
Adjusted Position and Exercise Limits
for certain Equity Option Classes will revert
to their Applicable Standard Position and
Exercise Limits effective October 24, 2005
Page 5
September 23, 2005
Volume 33, Number 38
Chicago Board Options Exchange
RESEARCH CIRCULARS
The following Research Circulars were distributed between September 16 and September 22, 2005. If you wish to read the entire document,
please refer to the CBOE website at www.cboe.com and click on the “Trading Tools” Tab. New listings and series information is also available
in the Trading Tools section of the website. For questions regarding information discussed in a Research Circular, please call The Options
Clearing Corporation at 1-888-OPTIONS.
Research Circular #RS05-666
September 16, 2005
Northwest Airlines Corporation (“NWAC/NAQ”)
Underlying Symbol Change to: (“NWACQ”)
Effective Date: September 19, 2005
Research Circular #RS05-673
September 21, 2005
Aspect Communications Corporation
(“ASPT/SQR”) Proposed Merger
with Concerto Software, Inc.
Research Circular #RS05-668
September 20, 2005
Software HOLDRs Trust (“SWH”) Cash Distribution
Ex-Distribution Date: September 21, 2005
Research Circular #RS05-675
September 21, 2005
Carrier Access Corporation (“CACSE/CQQ”)
Underlying Symbol Change to “CACS”
Effective Date: September 22, 2005
Research Circular #RS05-669
September 20, 2005
Metals USA, Inc. (“MUSA/JZU/OGH/YZP”) Proposed
Merger with Flag Holdings Corporation
Research Circular #RS05-672
September 20, 2005
Danielson Holding Corporation (“DHC”)
Name Change to: Covanta Holding Corporation
Effective Date: September 21, 2005
Research Circular #RS05-676
September 21, 2005
Sycamore Networks, Inc. (“SCMRE/SMZ”)
Underlying Symbol Change to “SCMR”
Effective Date: September 22, 2005
Research Circular #RS05-681
September 22, 2005
Aspect Communications Corporation (“ASPT/SQR”)
Merger COMPLETED with Concerto Software, Inc.
September 28, 2005
Volume RB16, Number 39
Regulatory
Bulletin
The Constitution and Rules of the Chicago Board Options Exchange, Incorporated
(“Exchange”), in certain specific instances, require the Exchange to provide notice to the membership. The weekly Regulatory Bulletin is delivered to all effective members to satisfy this
requirement.
Copyright © 2004 Chicago Board Options Exchange, Incorporated
Rule Changes,
Interpretations
and Policies
APPROVED RULE CHANGE(S)
The Securities and Exchange Commission (“SEC”) has approved the following change(s)
to Exchange Rules pursuant to Section 19(b) of the Securities Exchange Act of 1934, as
amended (“the Act”). Copies are available on the CBOE public website at www.cboe.com/
legal/effectivefiling.aspx.
The effective date of the rule change is the date of approval unless otherwise noted.
SR-CBOE-2004-86
Modified ROS Opening Procedure
On August 31, 2005, the SEC approved Rule Change File No. SR-CBOE-2004-86, which
filing revises Exchange Rule 6.2A.03 to require traders unwinding hedges and other related
trading activities in volatility futures to submit orders for placement in the book for the
corresponding index options by 8:00 a.m.. The proposed rule also requires all Exchange
orders for placement in the book for the opening to be placed by 8:25 a.m., instead of the
current 8:28 a.m. Any questions regarding the rule change may be directed to David
Doherty, Legal Division, at 312-786-7466. The text of the amended rules is set forth below.
New language is italicized.
Rule 6.2A. Rapid Opening System
This rule has no applicability to series trading on the CBOE Hybrid Opening System. Such series will be governed by Rule 6.2B.
(a) – (d) No change.
. . . Interpretation and Policies:
.01 - .02
No change.
.03
Modified ROS Opening Procedure For Calculation of Settlement Prices of
Volatility Indexes.
All provisions set forth in Rule 6.2A and the accompanying interpretations and
policies shall remain in effect unless superseded or modified by this Rule 6.2A.03.
To facilitate the calculation of a settlement price for futures and options contracts
on volatility indexes, the Exchange shall utilize a modified ROS opening procedure
for any index option series with respect to which a volatility index is calculated
(including any index option series opened under Rule 6.2A.01). This modified ROS
opening procedure will be utilized only on the final settlement date of the options
and futures contracts on the applicable volatility index in each expiration month.
The following provisions shall be applicable when the modified ROS opening procedure set forth in this Rule 6.2A.03 is in effect for an index option with
respect to which a volatility index is calculated:
Rule Changes,
Interpretations and
Policies continued
SR-CBOE-2004-86 continued
(i) All orders (including public customer, broker-dealer, Exchange Market-Maker
and away Market-Maker and specialist orders), other than contingency orders, will
be eligible to be placed on the Electronic Book for those option contract months
whose prices are used to derive the volatility indexes on which options and futures are traded, for the purpose of permitting those orders to participate in the
ROS opening price calculation for the applicable index option series.
(ii) All Market-Makers, including any LMMs and SMMs, if applicable, who are
required to log on to ROS or RAES for the current expiration cycle shall be required to log on to ROS during the modified ROS opening procedure if the MarketMaker is physically present in the trading crowd for that index option class.
(iii) If the ROS system is implemented in an option contract for which LMMs have
been appointed, the LMMs will collectively set the Autoquote values that will be
used by ROS.
(iv) ROS contracts to trade for that index option series will be assigned equally, to
the greatest extent possible, to all logged-on Market-Makers, including any LMMs
and SMMs if applicable.
(v) All index option orders for participation in the modified ROS opening procedure
that are related to positions in, or a trading strategy involving, volatility index
options or futures, and any change to or cancellation of any such order
(A) must be received prior to 8:00 a.m. (CT), and
(B) may not be cancelled or changed after 8:00 a.m. (CT), unless the
order is not executed in the modified ROS opening procedure and the
cancellation or change is submitted after the modified ROS opening procedure is concluded (provided that any such order may be changed or
cancelled after 8:00 a.m. (CT) and prior to 8:25 a.m. (CT) in order to
correct a legitimate error, in which case the member submitting the change
or cancellation shall prepare and maintain a memorandum setting forth
the circumstances that resulted in the change or cancellation and shall
file a copy of the memorandum with the Exchange no later than the next
business day in a form and manner prescribed by the Exchange.
In general, the Exchange shall consider index option orders to be related
to positions in, or a trading strategy involving, volatility index options or
futures for purposes of this Rule 6.2A.03(v) if the orders possess the
following three characteristics:
(i)
The orders are for options series with the expiration month that
will be used to calculate the settlement price of the applicable volatility
index option or futures contract.
(ii)
The orders are for options series spanning the full range of strike
prices in the appropriate expiration month for options series that will be
used to calculate the settlement price of the applicable volatility index
option or futures contract, but not necessarily every available strike price.
(iii)
The orders are for put options with strike prices less than the “atthe-money” strike price and for call options with strike prices greater than
the “at-the-money” strike price. The orders may also be for put and call
options with “at-the-money” strike prices.
RB2
September 28, 2005, Volume RB16, Number 39
Rule Changes,
Interpretations and
Policies continued
SR-CBOE-2004-86 continued
Whether index option orders are related to positions in, or a trading strategy involving, volatility index options or futures for purposes of this Rule 6.2A.03(v) depends
upon specific facts and circumstances. Order types other than those provided
above may also be deemed by the Exchange to fall within this category of orders if
the Exchange determines that to be the case based upon the applicable facts and
circumstances.
The provisions of this Rule 6.2A.03(v) may be suspended by two Floor Officials in
the event of unusual market conditions.
(vi) All other index option orders for participation in the modified ROS opening
procedure, and any change to or cancellation of any such order, must be received
prior to 8:25 a.m. (CT) in order to participate at the ROS opening price for the
applicable index option series.
(vii) All orders for participation in the modified ROS opening procedure must be
submitted electronically, except that Market-Makers on the Exchange’s trading floor
may submit paper tickets for market orders only.
(viii) The ROS system shall automatically generate cancellation orders immediately prior to the opening of the applicable index option series for Exchange MarketMaker, away Market-Maker, specialist, and broker-dealer orders which remain on
the Electronic Book following the modified ROS opening procedure.
(ix) Any imbalance of contracts to buy over contracts to sell in the applicable index
option series, or vice versa, as indicated on the Electronic Book, will be published
as soon as practicable after 8:00 a.m. (CT) and thereafter at approximately 8:20
a.m. (CT) on days that the modified ROS opening procedure is utilized.
SR-CBOE-2005-51
Intermarket Linkage
On September 13, 2005, the SEC approved Rule Change File No. SR-CBOE-2005-51, which
filing adopts “trade and ship” and “book and ship” concepts. These allow contemporaneous
trading/booking of orders that would otherwise cause a trade-through or lock if the NBBO
market is sent an order for its full size. Any questions regarding the rule change may be
directed to Angelo Evangelou, Legal Division, at 312-786-7464. The text of the amended
rules is set forth below. New language is italicized.
Rule 6.80. Definitions
The following terms shall have the meaning specified in this Rule solely for the
purpose of this Section E under Chapter VI:
(1)-(18)
No Change.
(19) “Trade-Through” means a transaction in an options series at a price that is
inferior to the NBBO, but shall not include a transaction that occurs at a price that
is one minimum quoting increment inferior to the NBBO provided a Linkage Order is
contemporaneously sent to each Participant Exchange disseminating the NBBO
for the full size of the Participant Exchange’s bid (offer) that represents the NBBO.
(20)-(21) No Change.
*****
September 28, 2005, Volume RB16, Number 39
RB3
Rule Changes,
Interpretations and
Policies continued
SR-CBOE-2005-51 continued
Rule 6.84. Locked and Crossed Markets
(a)-(b)
No Change.
(c)
Exception. The provisions of paragraphs (a) and (b) above do not apply to
situations where a member books an order that would lock a market and contemporaneously sends through the Linkage a P/A Order or Principal Order for the full
size of the bid or offer that was locked.
SR-CBOE-2005-57
80/20 Test Modification
On August 26, 2005, the SEC approved Rule Change File No. SR-CBOE-2005-57, which
filing amends CBOE’s Linkage rules by modifying the “80/20 Test” in determining limitations on Principal Order access. Specifically, it creates a de minimis exemption from the
Test for Market-Makers that have total contract volume of less than 1000 contracts in an
options class for a calendar quarter. Any questions regarding the rule change may be
directed to Angelo Evangelou, Legal Division, at 312-786-7464. The text of the amended
rules is set forth below. New language is italicized.
Rule 6.85. A Market-Maker shall not be permitted to send Principal Orders in an
Eligible Option Class through the Linkage for a given calendar quarter if the Market-Maker effected less than 80 percent of its volume in that Eligible Option Class
on the Exchange in the previous calendar quarter (that is, the Market-Maker effected 20 percent or more of its volume by sending Principal Orders through the
Linkage) as calculated by the Exchange. This restriction shall only apply if the
Market-Maker had total contract volume in the Eligible Option Class of at least
1000 contracts in the previous calendar quarter. This “80/20” is represented as
follows:
X
__________
X +Y
“X” equals the total contract volume the Market-Maker effects in an Eligible Option Class against orders of Customers on the Exchange during a calendar quarter (a) including contract volume effected by executing P/A Orders sent to the
Exchange through the Linkage, but (b) excluding contract volume effected by
sending P/A Orders through the Linkage for execution on another Participant
Exchange. “Y” equals the total contract volume the Market-Maker effects in such
Eligible Option Class by sending Principal Orders through the Linkage during that
calendar quarter.
RB4
September 28, 2005, Volume RB16, Number 39
Rule Changes,
Interpretations and
Policies continued
EFFECTIVE-ON-FILING RULE CHANGE(S)
The following rule filing(s) were submitted to the SEC “effective-on-filing,” and have taken
effect pursuant to Section 19(b)(3) of the Securities Exchange Act. They will remain in
effect barring further action by the SEC within 60 days after their publication in the Federal
Register. Copies are available on the CBOE public website at www.cboe.com/legal/
effectivefiling.aspx.
SR-CBOE-2005-74
RMM Appointments
On September 8, 2005, the Exchange filed Rule Change File No. SR-CBOE-2005-74, which
filing amends Rule 8.4 relating to Remote Market-Maker appointments. Specifically, the
filing adds options on DIAMONDS to Tier “A+” and reduces the “appointment cost” for Tier
“A+” from .60 to .25. Any questions regarding the rule change may be directed to Patrick
Sexton, Legal Division, at 312-786-7467. The text of the amended rule is set forth below.
New language is italicized.
Rule 8.4. (a)
No change.
(b)
No change.
(c)
No change.
(d)
Appointment of RMMs: An RMM will have a Virtual Trading Crowd
(“VTC”) Appointment, which confers the right to quote electronically (and
not in open outcry) an appropriate number of products selected from “tiers”
that have been structured according to trading volume statistics. Of the
products included in the Hybrid 2.0 Platform, Tier A will consist of the 20%
most actively-traded products over the preceding three calendar months,
excluding “A+” tier products, Tier B will consist of the next 20% most
actively-traded products, etc., through Tier E, which will consist of the
20% least actively-traded products. Tier “A+” will consist of options on
Standard & Poor’s Depositary Receipts, options on the Nasdaq-100 Index
Tracking Stock, and options on DIAMONDS.
All products within a specific Tier will be assigned an “appointment cost”
depending upon its Tier location. Each “A+” Tier product will have an “appointment cost” of .25. Each Tier A product will have an “appointment
cost” of .10, each Tier B product will be .0667, each Tier C product will be
.05, each Tier D product will be .04, and each Tier E product will be .033.
An RMM as part of its VTC appointment may select for each Exchange
membership it owns or leases any combination of Hybrid 2.0 products
whose aggregate “appointment cost” does not exceed 1.0. For example,
an RMM could request six “A Tier” products (6x.10), four “C Tier” products
(4x.05), and five “D Tier” products (5x.04) to constitute its VTC appointment.
*****
(e)
No change.
(f)
No change.
. . . Interpretations and Policies:
.01
September 28, 2005, Volume RB16, Number 39
No change.
RB5
Appeals Committee
Decisions
Appeals Committee Decisions
Chapter XIX of the Exchange’s Rules provides persons who have been economically
aggrieved by certain Exchange actions the opportunity to have the action reviewed by a
panel of the Appeals Committee. Any questions regarding the appeals process may be
directed to the Office of the Secretary at 312-786-7570.
Pursuant to a policy adopted by the Board of Directors, each Appeals Committee decision
relating to an appeal filed after June 15, 1998 (and any Board of Directors decision relating
to the appeal) is summarized in the Regulatory Bulletin and made available by the Legal
Division upon written request. No Appeals Committee decision will be publicized or otherwise made available until the Exchange’s review of the appeal becomes final.
Appeal File No. 05A002
This appeal was brought by Matthew Peters and Timothy McGugan of Geneva Capital
Investments LLC (Appellants). The Appellants appealed to the Appeals Committee a
decision by a Crowd Space Dispute Resolution Panel (CSDRP) in favor of Richardo Forrer
of Panos Trading Limited Partnership (Panos) with respect to a crowd space dispute in the
OEX trading crowd between Mr. Peters and Mr. Forrer. The parties to the appeal proceeding were the Appellants, the CSDRP, and Mr. Forrer and Panos (who intervened as parties
to the appeal proceeding). A hearing on the appeal was held before an Appeals Committee
Panel. At the hearing, the parties were all given a full opportunity to present arguments,
testimony witnesses, and documents pertaining to the appeal. Following the hearing, the
Panel issued a written decision with respect to the appeal.
In the decision, the Panel did not find merit in the Appellants’ argument that the CSDRP
hearing was unduly delayed. In this regard, the Panel found that CBOE Rule 24.21, Index
Crowd Space Dispute Resolution Procedures, provides that the crowd space dispute hearing process is not initiated until a hearing request form and the required hearing fee are
submitted to the Office of the Secretary and that the time frame between the initiation of
the hearing process and the date of the CSDRP hearing was not unreasonable. The Panel
also did not find merit in the Appellants’ objections to the CSDRP hearing process. Finally,
the Panel found that the Appellants did not meet their burden of showing by a preponderance of the evidence that the CSDRP decision was erroneous. Accordingly, the Panel
affirmed the CSDRP’s decision in favor of Mr. Forrer.
RB6
September 28, 2005, Volume RB16, Number 39