Pre-Effective Amendment to Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4/A Amendment #1 to Form S-4 213 1.10M
2: EX-3.1 Amended & Restated Certificate of Incorporation 13 51K
3: EX-3.3 Amended & Restated Bylaws 12 49K
4: EX-4.4 Rules & Regulations of the Board of Trade 648 2.79M
5: EX-4.5 Form of Rules and Regulations 639 2.77M
6: EX-8 Form of Opinion of Kirkland & Ellis 2 13K
7: EX-10.1 Agreement, Dated 4/14/00 Between Cbot & Donovan 11 39K
16: EX-10.10 Security Agreement, Dated 8/11/00 10 38K
17: EX-10.11 2nd Amend. & Restated Ltd. Partnership Agreement 46 186K
18: EX-10.12 Exec. Employment Agreement (David J. Vitale) 20 77K
19: EX-10.13 License Agreement Dated 6/5/97 36 123K
20: EX-10.14 Amendment to License Agreement 4 18K
21: EX-10.15 2nd Amendment to License Agreement 7 27K
22: EX-10.16 3rd Amendment to License Agreement 4 18K
23: EX-10.17 Alliance Agreement Dated 10/01/99 49 163K
24: EX-10.18 Software License Agreement Dated 10/01/99 21 84K
25: EX-10.19 Master Software Development Agreement Dated 71 224K
7/20/99
8: EX-10.2 Agreement, Dated 4/18/00 Between Cbot & Dutterer 3 22K
26: EX-10.20 Confirmation of Rights Agreement Dated 7/27/00 14 105K
27: EX-10.21 Systems Operations Agreement Dated 7/20/99 77 220K
28: EX-10.22 2nd Amendment & Restated License Agreement 11 40K
29: EX-10.23 Isda Master Agreement 63 272K
9: EX-10.3 Agreement, Dated 4/18/00 Between Cbot & Botcc 2 18K
10: EX-10.4 Exec. Employment Agreement (Patrick J. Catania) 13 39K
11: EX-10.5 Amend. to Employment Agreement(Patrick J. Catania) 4 21K
12: EX-10.6 Exec. Employment Agreement (Carol A. Burk) 13 39K
13: EX-10.7 Amend. Employment Agreement (Carol A. Burke) 4 21K
14: EX-10.8 Note Purchase Agreement Dated 3/01/97 77 282K
15: EX-10.9 Credit Agreement, Dated 8/11/00 64 235K
30: EX-21 Subsidiaries of For-Profit Cbot 1 10K
31: EX-23.1 Consent of Deloitte & Touche, LLP 1 11K
32: EX-23.4 Consent of William Blair & Co., L.L.C. 1 11K
33: EX-23.5 Consent of Arthur Andersen LLP 1 12K
34: EX-99.1 Form of Proxy Card 2± 13K
Exhibit 4.5
CHARTER, BYLAWS, RULES AND
REGULATIONS
OF THE
CHICAGO
BOARD OF TRADE
[GRAPHIC OMITTED]
As of _______1, 2001
Copyright Board of Trade of the City of Chicago, Inc. 2001
ALL RIGHTS RESERVED
December 1, 2000
AMENDMENTS TO THE CHARTER, BYLAWS, RULES AND REGULATIONS OF THE BOARD OF TRADE
------------------------------------------------------------------------------
OF THE CITY OF CHICAGO, INC.
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Changes from September 1 to December 1, 2000
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CHARTER
-------
(Amended Article Sixth, amended Exhibit A, Section 3, and amended Exhibit B,
Sections 2, 5 and 7)
BYLAWS
------
(Amended Article II, Section 4 and Amended Article III, Section 2)
Rules & Regulations
-------------------
I. CHAPTER 1 (Government)
----------------------
(Revised Rule 156.00 and New Reg. 188.05)
II. CHAPTER 3 (Exchange Floor Operations & Procedures)
--------------------------------------------------
(Revised Reg. 332.06)
III. CHAPTER 4 (Futures Commission Merchants)
----------------------------------------
(Revised Rule 450.00; Revised Regs. 425.01 thru 425.07 and 431.03; New Reg.
450.05; Deleted Regs. 495.01 thru 495.07)
IV. CHAPTER 9 (Definitions)
-----------------------
(New Reg. 915.02)
V. CHAPTER 10 (Grains)
-------------------
(Revised Regs. 1007.02 and 1081.01)
December 1, 2000 Changes
(Continued)
VI. CHAPTER 10C (Corn Futures)
--------------------------
(Revised Regs. C1041.01, C1056.01 and C1081.01)
VII. CHAPTER 10S (Soybean Futures)
-----------------------------
(Revised Regs. S1041.01, S1056.01 and S1081.01)
APPENDICES
Revised Appendix 2
Revised Appendix 3C
Revised Appendix 3D
Revised Appendix 10C
Revised Appendix 10E
Revised Appendix 10G
Revised Appendix 10C(A)
Revised Appendix 11A
Revised Appendix 11B
Deleted Appendix 4D
Chicago Board of Trade Charter, Bylaws, Rules & Regulations
Table of Contents
Copyright
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Charter
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Bylaws
------
Rules & Regulations
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[Download Table]
Chapter 1 - Government
Chapter 2 - Membership
Chapter 3 - Exchange Floor Operations and Procedures
Chapter 4 - Futures Commission Merchant
Chapter 5 - Disciplinary Proceedings
Chapter 6 - Arbitration of Member Controversies
Chapter 7 - Clearing House, Deposits for Security
Chapter 9 - Definitions
*Chapter 9a - Trading Links
Chapter 9b - e-cbot
Chapter 10 - Grains
Chapter 10c - Corn Futures
Chapter 10s - Soybean Futures
Chapter 11 - Soybean Oil
Chapter 12 - Soybean Meal
Chapter 13 - Oats Futures Options
Chapter 14a - 1,000 Ounce Silver Futures
Chapter 14b - 5,000 Ounce Silver Futures
Chapter 15a - One Kilo Gold Futures
Chapter 15b - 100 Ounce Gold Futures
Chapter 16 - Silver Futures Options
*Chapter 17 - GNMA - CDR
Chapter 18 - U.S. Treasury Bonds
Chapter 19 - Long-Term Municipal Bond Index Futures
Chapter 21 - 30-Day Fed Fund Futures
Chapter 22 - Long-Term Municipal Bond Index Futures Options
Chapter 23 - Short Term U.S. T-Notes (2-Year)
Chapter 24 - Long Term T-Notes (6 1/2 -10 Year)
Chapter 25 - Medium Term U.S. Treasury Notes (5 Year)
Chapter 27a - (Standard Options) Long Term Treasury Note Futures Options
Chapter 27b - (Flexible Options) Long Term Treasury Note Flexible Options
Chapter 28a - (Standard Options) T-Bond Futures Options
Chapter 28b - (Flexible Options) Treasury Bond Flexible Options
*Not reprinted in Rulebook. Copies are available from the Secretary's Office.
[Download Table]
Chapter 29 - Soybean Futures Options
Chapter 30 - Corn Futures Options
Chapter 31 - Wheat Futures Options
Chapter 32 - Soybean Oil Futures Options
Chapter 33 - Soybean Meal Futures Options
Chapter 35a - (Standard Options) Medium Term U.S. Treasury Note Futures Options
Chapter 35b - (Flexible Options) Medium Term Treasury Note Flexible Options
Chapter 36a - (Standard Options) Short Term U.S.Treasury Note Futures Options
Chapter 36b - (Flexible Options) Short Term Treasury Note Flexible Options
Chapter 37 - CBOT Rough Rice Futures
Chapter 38 - CBOT Rough Rice Options
Chapter 39 - Dow Jones Utility Average Index Futures
Chapter 41 - CBOT Dow Jones Transportation Average Index Futures
Chapter 43 - CBOT Dow Jones Industrial Average Index Futures
Chapter 44 - CBOT Dow Jones Industrial Average Index Futures Options
Chapter 45 - Long Term Fannie Mae Benchmark Notes and Freddie Mac Reference
Note Futures
Chapter 46a - Long Term Fannie Mae Benchmark Note and Freddie Mac Reference
Note Futures Options
Chapter 48 - PCS Catastrophe Insurance Options
Chapter 51 - Corn Yield Insurance Futures
Chapter 52 - Corn Yield Insurance Options
Chapter 53 - Dow Jones Composite Average Index Futures
Appendices
1. Reserved
2. Summary of Membership Privileges
3. Exchange Floor Operations and Procedures
A. Guidelines for Guests and Visitors
While on the Exchange Floor of the Chicago Board of Trade
B. Instructions for Floor Clerk Access
to the Floor of the Board of Trade of the City of Chicago
C. Dress Code
D. Pit Openings and Closings
E. Contract Month Symbols
F. Reserved
G. Guidelines - Badge Validation and Return
4. Futures Commission Merchants
A. Reserved
B. Reserved
C. Minimum Financial Requirements - Non-FCM Member Firms
D. Reserved
E. Financial Requirements for Agricultural Regularity
5. Reserved
6. Arbitration Fees
A. Member Claims
B. Non-Member Claims
7.-9. Reserved
9B. Implementation Regulations of e-cbot Concerning Technical Equipment
10. Grains
A. Regular Warehousemen
- Chicago and Burns Harbor Switching Districts
B. Regular Warehousemen
- St. Louis-East St. Louis and Alton Switching Districts
C. Regular Warehousemen
- Minneapolis and St. Paul Switching Districts
D. Regular Warehousemen
- Toledo, Ohio Switching District
E. Storage Rates
F. Reciprocal Switching Charges
within Chicago, IL and Burns Harbor, IN
G. Grain Load-Out Procedures
10C(A). Corn and Soybean Shipping Stations
10S(A). Soybean Only Shipping Stations
11. Soybean Oil
A. Regular Shippers
B. Differentials
12. Soybean Meal
A. Regular Shippers
B. Differentials
13. Reserved
14. Silver
A. Approved Brands
B. Regular Vaults
C. Regular New York Vaults
D. Storage Rates
E. Official Assayers
15. Gold
A. Approved Brands
B. Regular Vaults
C. Storage Rates
D. Official Assayers
E. Approved Sources & Vaults
16. Reserved
17. Government National Mortgage Association (GNMA)
Collateralized Depositary Receipt (CDR)
A. Approved Depositaries
B. Approved Originators
18. Reserved
19. Pricing Brokers/Bond Buyer Municipal Bond Index
20-36. Reserved
37. Rough Rice
A. Mill Site Warehouses
B. Rough Rice Regular Warehouses Delivery Differentials
C. Definitions
D. Minimum Financial Requirements for Rough Rice Regularity
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
BOARD OF TRADE OF THE
CITY OF CHICAGO, INC.
(Originally incorporated under the name
Delaware CBOT, Inc. on May 12, 2000)
ARTICLE I
NAME
The name of the corporation is Board of Trade of the City of Chicago, Inc.
(hereinafter referred to as the "Corporation").
ARTICLE II
REGISTERED AGENT
The address of the registered office of the Corporation in the State of
Delaware is 9 Loockerman Street, in the City of Dover, County of Kent, Delaware
19901. The name of the registered agent of the Corporation at such address is
National Registered Agents, Inc.
ARTICLE III
CORPORATE PURPOSES
The nature of the business or purposes to be conducted or promoted by the
Corporation are to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of the State of Delaware (the
"DGCL").
ARTICLE IV
CAPITAL STOCK
A. Authorized Shares.
The total number of shares of stock which the Corporation shall have the
authority to issue is 110,000,000, which shares shall be divided into classes
and series as follows:
99,996,273 shares of Class A Common Stock, par value $0.001 per share (the
"Class A Common Stock");
3,727 shares of Class B Common Stock, par value $0.001 per share (the
"Class B Common Stock" and, together with the Class A Common Stock, the
"Common Stock"), of which:
1,402 shares shall be Class B Common Stock, Series B-1 (the "Series B-
1");
866 shares shall be Class B Common Stock, Series B-2 (the "Series B-
2");
174 shares shall be Class B Common Stock, Series B-3 (the "Series B-
3");
643 shares shall be Class B Common Stock, Series B-4 (the "Series B-
4"); and
642 shares shall be Class B Common Stock, Series B-5 (the "Series B-
5"); and
10,000,000 shares of Preferred Stock, par value $0.001 per share (the
"Preferred Stock").
The powers, preferences and rights of the shares of such classes and series,
and the qualifications, limitations and restrictions thereof, are as set forth
hereinafter in this Amended and Restated Certificate of Incorporation
(hereinafter referred to as the "Certificate of Incorporation"). The number of
authorized shares of Preferred Stock may be increased or decreased (but not
below the number of shares thereof then outstanding) from time to time by the
affirmative vote of the holders of a majority of the stock of the Corporation
entitled to vote.
B. Common Stock.
1. Voting Rights and Powers. Except as otherwise provided in this
Certificate of Incorporation or required by law, with respect to all matters
upon which stockholders are entitled to vote, the holders of the outstanding
shares of Class A Common Stock shall vote together with the holders of any other
outstanding shares of stock of the Corporation entitled to vote, without regard
to class, and each holder of outstanding shares of Class A Common Stock shall be
entitled to one vote per such share; provided, however, that the holders of
Class A Common Stock shall not be entitled to vote, either with the holders of
Series B-1 and Series B-2 or otherwise, on the matters to be voted on by the
holders of Series B-1 and Series B-2 set forth in Section C(2) of this Article
IV. Except as otherwise provided in this Certificate of Incorporation or
required by law, the holders of outstanding shares of Class B Common Stock shall
not be entitled to vote on any matter. On any matter on which the holders of
Series B-1 and Series B-2 are entitled to vote together as a class pursuant to
Section C(2) of this Article IV, or are otherwise required to vote together with
other holders of outstanding shares of Class B Common Stock as a class pursuant
to the DGCL, each holder of outstanding shares of Series B-1 shall be entitled
to one vote per such share and each holder of outstanding shares of Series B-2
shall be entitled to one-sixth of one vote per such share. On any matter on
which the holders of Series B-3, Series B-4 and Series B-5 are required to vote
together with other holders of outstanding shares of Class B Common Stock as a
class pursuant to the DGCL, each holder of outstanding shares of Series B-3,
Series B-4 and Series B-5 shall be entitled to one-tenth of one vote per such
share.
2. Dividends. Subject to such rights and preferences of the Preferred
Stock as are set forth herein or in any resolution or resolutions authorizing
the issuance of such Preferred Stock pursuant to Section D of this Article IV,
the holders of Class A Common Stock and Class B Common Stock shall be entitled
to receive such dividends as may from time to time be declared by the Board of
Directors on the shares of such classes out of funds legally available therefor;
provided that dividends may only be declared ratably on the shares of both such
classes of Common Stocks.
3. Distribution of Assets Upon Liquidation. In the event the Corporation
shall be liquidated, dissolved or wound up, whether voluntarily or
involuntarily, after there shall have been paid or set aside for the holders of
all shares of the Preferred Stock then outstanding the full preferential amounts
to which they are entitled hereunder or under the resolution or resolutions
authorizing the issuance of such Preferred Stock pursuant to Section D of this
Article IV, the net assets of the Corporation remaining thereafter shall be
distributed ratably among the holders of Common Stock.
4. Initial Restriction on Transfer. For a period of 180 days following the
initial issuance of Class A Common Stock by the Corporation, no share of Class A
Common Stock may be sold, transferred or otherwise disposed of except (a) by
operation of law (b) in a transaction specifically approved by the Board of
Directors of the Corporation or (c) in a transaction consummated in connection
with the sale, transfer or disposal of Class B Common Stock that results in the
number of shares of Class A Common Stock associated with the series of such
Class B Common Stock being sold, transferred or disposed of to the same
transferee of such Class B
Common Stock (i.e., 25,000 shares of Class A Common Stock may be transferred
with one share of Series B-1 Class B Common Stock; 5,000 shares of Class A
Common Stock may be transferred with one share of Series B-2 Class B Common
Stock; 2,500 shares of Class A Common Stock may be transferred with one share of
Series B-3 Class B Common Stock; 300 shares of Class A Common Stock may be
transferred with one share of Series B-4 Class B Common Stock and 350 shares of
Class A Common Stock may be transferred with one share of Series B-5 Class B
Common Stock). Any purported sale, transfer or other disposition of Common Stock
not in accordance with the preceding sentence shall be void and shall not be
recorded on the books of or otherwise recognized by the Corporation.
Notwithstanding the foregoing provisions of this Section B.4 of Article IV,
the Board of Directors may remove some or all of the foregoing restrictions on
transfer if it determines, in its sole and absolute discretion, that such
removal is appropriate.
5. Conversion Rights of Series B-3.
(a) Conversion. Subject to and upon compliance with the provisions of this
Section B.5 of Article IV, any two shares of Series B-3 shall be convertible
at the option of the holder into one fully paid and nonassessable share of
Series B-2. If any odd number of shares of Series B-3 are submitted for
conversion, the Corporation shall not be obligated to issue any fractional
share of Series B-2 but shall instead be entitled to issue scrip in lieu of
such fraction in accordance with Section 155 of the DGCL.
(b) Mechanics of Conversion. A holder of shares of Series B-3 may exercise
the conversion right specified in Section B.5 (a) of Article IV as to such
holder's shares by surrendering to the Corporation or any transfer agent of
the Corporation the certificate or certificates for the shares to be
converted, accompanied by written notice stating that the holder elects to
convert all of the shares represented thereby. Conversion shall be deemed to
have been effected on the date when delivery of such written notice and share
certificate or certificates is made, and such date is referred to herein as
the Conversion Date. As promptly as practicable after the Conversion Date, the
Corporation shall issue and deliver to or upon the written order of such
holder a certificate or certificates for the number of whole shares of Series
B-2 to which such holder is entitled as a result of the exercise of such
conversion right. The person in whose name the certificate or certificates for
Series B-2 are to be issued shall be deemed to have become the holder of
record of such Series B-2 on the applicable Conversion Date.
(c) Status of Converted Shares. Shares of Series B-3 that are converted
into shares of Series B-2 shall not be reissued.
(d) Shares Reserved for Issuance. In connection with any conversion
pursuant to this Section B.5 of Article IV, the Corporation shall take all
actions necessary to make available out of its authorized but unissued shares
of Series B-2, solely for the purpose of issuance upon the conversion of the
Series B-3, such number of shares of Series B-2 issuable upon the conversion
of all outstanding Series B-3.
C. Class B Common Stock.
The holders of each series of Class B Common Stock shall have the membership
rights and voting rights, and shall be subject to the restrictions, terms and
conditions, set forth below.
1. Series Membership Rights.
a) Series B-1. Each holder of a share of Series B-1 who satisfies the
qualifications for and requirements of Full Membership in the Corporation as
set forth in the Rules and Regulations of the Corporation (hereinafter
referred to collectively, and as they may be amended from time to time, as the
"Rules," a copy of which will be furnished to any record holder of Class B
Common Stock upon request) shall be entitled to the rights and privileges of,
and shall be subject to the restrictions, conditions and limitations on, a
Full Member as set forth in the Rules.
b) Series B-2. Each holder of a share of Series B-2 who satisfies the
qualifications for and requirements of Associate Membership in the Corporation
as set forth in the Rules shall be entitled to the rights and privileges of,
and shall be subject to the restrictions, conditions and limitations on, an
Associate Member as set forth in the Rules.
c) Series B-3. Each holder of a share of Series B-3 who satisfies the
qualifications for and requirements of being a holder of a GIM Membership
Interest in the Corporation as set forth in the Rules
shall be entitled to the rights and privileges of, and shall be subject to the
restrictions, conditions and limitations on, a holder of a GIM Membership
Interest as set forth in the Rules.
d) Series B-4. Each holder of a share of Series B-4 who satisfies the
qualifications for and requirements of being a holder of a IDEM Membership
Interest in the Corporation as set forth in the Rules shall be entitled to the
rights and privileges of, and shall be subject to the restrictions, conditions
and limitations on, a holder of a IDEM Membership Interest as set forth in the
Rules.
e) Series B-5. Each holder of a share of Series B-5 who satisfies the
qualifications for and requirements of being a holder of an COM Membership
Interest in the Corporation as set forth in the Rules shall be entitled to the
rights and privileges of, and shall be subject to the restrictions, conditions
and limitations on, a holder of an COM Membership Interest as set forth in the
Rules.
f) In addition to the membership rights and privileges set forth above,
each holder of a share of any series of Class B Common Stock shall be entitled
to all trading rights and privileges with respect to those products that such
holder is entitled to trade on the open outcry exchange system of the
Corporation on any electronic trading system maintained by the Corporation or
any of its affiliates or any of their respective successors or successors-in-
interest.
2. Series Voting Rights. In addition to any vote of the holders of any class
or series of stock of the Corporation required by law, the affirmative vote of
the holders of a majority of the voting power of the then-outstanding shares of
the Series B-1 and the Series B-2, voting together as a class based on their
respective voting rights, shall be required to adopt any amendment or make any
change to this Certificate of Incorporation, the bylaws of the Corporation or
the Rules that, in the sole and absolute determination of the Board of
Directors, adversely affects (a) the allocation of products that the holders of
any series of Class B Common Stock are permitted to trade on the exchange
facilities of the Corporation (including both the open outcry and electronic
trading systems), (b) the requirement that holders of shares of Class B Common
Stock who meet the applicable membership and eligibility requirements will be
charged transaction fees for trades of For-Profit CBOT's products for their
accounts that are lower than the transaction fees charged to any participant who
is not a holder of Class B Common Stock for the same products, whether trading
utilizing the open outcry trading system or the electronic trading system, (c)
the authorized number of shares of any series of Class B Common Stock, (d) the
membership qualifications or eligibility requirements for holding shares of any
series of Class B Common Stock or exercising any of the membership rights and
privileges associated with such series or (e) the Commitment to Maintain Open
Outcry Markets set forth in Section E of Article IV of this Certificate of
Incorporation.
D. Preferred Stock.
The Board of Directors is authorized, subject to any limitations prescribed by
law, to provide for the issuance of shares of Preferred Stock in series, and by
filing a certificate pursuant to the applicable law of the State of Delaware
(such certificate being hereinafter referred to as a "Preferred Stock
Designation"), to establish from time to time the number of shares to be
included in each such series, and to fix the designation, powers, preferences
and rights of the shares of each such series and any qualifications, limitations
or restrictions thereof. The number of authorized shares of Preferred Stock may
be increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the Class A
Common Stock, without a vote of the holders of the Preferred Stock, or of any
series thereof, unless a vote of any such holders is required pursuant to the
terms of any Preferred Stock Designation.
E. Commitment to Maintain Open Outcry Markets. Subject to the terms and
conditions of this Section E of Article IV, the Corporation shall maintain open
outcry markets operating as of the date of the filing of this Certificate of
Incorporation and provide financial support to each such market for technology,
marketing and research, which the Board of Directors determines, in its sole and
absolute discretion, is reasonably necessary to maintain each such open outcry
market.
Notwithstanding the foregoing or any other provision of this Certificate of
Incorporation, the board of directors may discontinue any open outcry market at
such time and in such manner as it may determine if (a) the Board of Directors
determines, in its sole and absolute discretion, that a market is no longer
"liquid" or (b) the holders of a majority of the voting power of the then
outstanding shares of the Series B-1 and the Series B-2, voting together as a
single class based on their respective voting rights, approve the discontinuance
of such open outcry market.
For purposes of the foregoing, an open outcry market will be deemed "liquid"
for so long as it meets either of the following tests, in each case as measured
on a quarterly basis:
a) if a comparable exchange-traded product exists, the open outcry market
has maintained at least 30 percent of the average daily volume of such
comparable product (including for calculation purposes, volume from Exchange-
For-Physicals transactions in such open outcry market); or
b) if no comparable exchange-traded product exists, the open outcry market
has maintained at least 40 percent of the average quarterly volume in that
market as maintained by the Corporation in 2000 (including, for calculation
purposes, volume from Exchange-For-Physicals transactions in such open outcry
market).
ARTICLE V
MANAGEMENT OF AFFAIRS
The following provisions are inserted for the management of the business and
the conduct of the affairs of the Corporation, and for further definition,
limitation and regulation of the powers of the Corporation and of its Directors
and stockholders:
A. In accordance with Section 141(a) of the DGCL, the business and
affairs of the Corporation shall be managed by or under the direction of a
governing body, which shall be known as the "Board of Directors," the
composition of which shall be as set forth in Article VI of this Certificate
of Incorporation. In addition to the powers and authority expressly conferred
upon them by statute or by this Certificate of Incorporation or the Bylaws of
the Corporation, the directors are hereby empowered to adopt, amend or repeal
the Rules of the Corporation, subject to Section C(2) of Article IV of this
Certificate of Incorporation, and to exercise all powers and do all acts and
things as may be exercised or done by the Corporation. The stockholders of the
Corporation shall have no power to adopt, amend or repeal the Rules of the
Corporation, except to the extent that the approval of the holders of Series
B-1 and Series B-2 is expressly required under Section C(2) of Article IV for
the Board of Directors to adopt certain amendments and changes specified
therein.
B. The directors of the Corporation need not be elected by written ballot
unless the by-laws so provide.
C. Any action required or permitted to be taken by the stockholders of
the Corporation must be effected at a duly called annual or special meeting of
stockholders of the Corporation and may not be effected by any consent in
writing by such stockholders.
D. Special meetings of stockholders of the Corporation may be called only
by the Chairman of the Board or the President of the Corporation or by the
Board of Directors acting pursuant to a resolution adopted by a majority of
the Whole Board. For purposes of this Certificate of Incorporation, the term
"Whole Board" shall mean the total number of authorized directors whether or
not there exist any vacancies in previously authorized directorships.
ARTICLE VI
BOARD OF DIRECTORS
A. The effectiveness of the amendment and restatement of this Certificate of
Incorporation giving the Corporation the authority to issue stock (the "Stock
Conversion") shall not change the size or composition of the Board of Directors
of the Corporation. Commencing with the election of directors at the first
annual or special meeting of stockholders following the Stock Conversion (the
"Initial Meeting"), the number of directors shall be nine (9), plus any
directors who the holders of any series of Preferred Stock may be entitled
to elect under specified circumstances (hereinafter referred to as "Preferred
Stock Directors"), and the directors, other than any Preferred Stock Directors,
shall be divided into three classes, with the term of office of the first class
to expire at the Corporation's first annual meeting of stockholders following
the Initial Meeting, the term of office of the second class to expire at the
Corporation's second annual meeting of stockholders following the Initial
Meeting and the term of office of the third class to expire at the Corporation's
third annual
meeting of stockholders following the Initial Meeting. At each annual meeting of
stockholders following the Initial Meeting, directors elected to succeed those
directors whose terms expire shall be elected for a term of office to expire at
the third succeeding annual meeting of stockholders after their election.
Commencing with the Initial Meeting, the following qualifications for directors,
other than Preferred Stock Directors, shall apply: three directors, on the date
of the first of their nomination or selection as nominees for the Board of
Directors, shall be "independent directors" as such term is defined in the
Bylaws of the Corporation (the "Independent Directors"); five directors, on
the date of the first of their nomination or selection as nominees for the Board
of Directors, shall be holders of Class B Common Stock and shall satisfy the
qualifications for and requirements of the applicable class of membership as set
forth in the Rules (the "Class B Directors"); and one director, not subject to
any qualifications, who shall serve as Chairman of the Board of Directors (the
"Chairman Director"). The class of directors whose term expires at the first
annual meeting of stockholders following the Initial Meeting shall be comprised
of one Independent Director and two Class B Directors. The class of directors
whose term expires at the second annual meeting of stockholders following the
Initial Meeting shall be comprised of one Independent Director, one Class B
Director and the Chairman Director. The class of directors whose term expires at
the third annual meeting of stockholders following the Initial Meeting shall be
comprised of one Independent Director and two Class B Directors. Notwithstanding
anything else set forth in this Certificate of Incorporation, pursuant to
Section 141(a) of the DGCL, the position of Chairman Director shall, from and
after the Initial Meeting and until the second annual meeting of stockholders
following the Initial Meeting, be held by the person who held the office of
Chairman of the Board of Directors immediately prior to the Initial Meeting, and
such person shall not be elected by the stockholders of the Corporation but
rather shall hold the position of Chairman Director by virtue of his holding of
the office of Chairman of the Board of Directors immediately prior to the
Initial Meeting. Commencing with the second annual meeting of stockholders
following the Initial Meeting, the Chairman Director shall be elected by the
stockholders entitled to vote thereon. The person serving as Chairman Director
shall be Chairman of the Board of Directors.
B. Subject to the rights of the holders of any series of Preferred Stock
then outstanding, newly created directorships resulting from any increase in the
authorized number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification, removal from
office or other cause shall, unless otherwise required by law or by resolution
of the Board of Directors, be filled only by a majority vote of the directors
then in office, though less than a quorum (and not by stockholders), and
directors so chosen shall hold office for a term expiring at the annual meeting
of stockholders at which the term of office of the class to which they have been
chosen expires. No decrease in the authorized number of directors shall shorten
the term of any incumbent director.
C. Advance notice of stockholder nominations for the election of directors
and of business to be brought by stockholders before any meeting of the
stockholders of the Corporation shall be given in the manner provided in the
Bylaws of the Corporation.
ARTICLE VII
AMENDMENT OF BYLAWS
Subject to Section C(2) of Article IV of this Certificate of Incorporation,
the Board of Directors is expressly empowered to adopt, amend or repeal the
Bylaws of the Corporation and the Rules. Any adoption, amendment or repeal of
the Bylaws of the Corporation by the Board of Directors shall require the
approval of a majority of the Whole Board. The stockholders shall also have
power to adopt, amend or repeal the Bylaws of the Corporation; provided,
however, that, in addition to any vote of the holders of any class or series of
stock of the Corporation required by law or by this Certificate of
Incorporation, any adoption, amendment or repeal of the bylaws of the
Corporation by the stockholders shall require the affirmative vote of the
holders of at least sixty six and two-thirds percent (66 2/3%) of the voting
power of all of the then-outstanding shares of stock of the Corporation entitled
to vote generally in the election of directors, voting together as a single
class.
ARTICLE VIII
LIMITATION OF LIABILITY
A director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any
transaction from which the director derived an improper personal benefit. If the
DGCL is amended to authorize corporate action further eliminating or limiting
the personal liability of directors, then the liability of a director of the
Corporation shall be eliminated or limited to the fullest extent permitted by
the DGCL, as so amended.
Any repeal or modification of the foregoing paragraph by the stockholders of
the Corporation shall not adversely affect any right or protection of a director
of the Corporation existing at the time of such repeal or modification.
ARTICLE IX
AMENDMENT OF CERTIFICATE OF INCORPORATION
The Corporation reserves the right to amend or repeal any provision contained
in this Certificate of Incorporation in the manner prescribed by the laws of the
State of Delaware and all rights conferred upon stockholders are granted subject
to this reservation.
ARTICLE X
ISSUANCE OF RIGHTS
In addition to and not in limitation of any powers conferred upon the Board of
Directors of the Corporation by the DGCL, the Board of Directors is hereby
authorized to create and issue, whether or not in connection with the issuance
and sale of any stock of the Corporation or other securities or property, rights
entitling any holders of stock of the Corporation to purchase or receive from
the Corporation shares of Preferred Stock. Common Stock or other securities or
assets of the Corporation or any other entity. The times at which and the terms
upon which such rights are issued, are exercisable and are to remain outstanding
shall be determined by the Board of Directors. The authority of the Board of
Directors with respect to such rights shall include, without limitation,
determination of the following:
(A) The initial purchase price per share or other unit of the stock or
other securities or property to be purchased upon exercise of such rights;
(B) Provisions relating to the times at which and the circumstances under
which such rights may be exercised or sold or otherwise transferred, either
together with or separately from, any other stock or other securities of the
Corporation;
(C) Provision which adjust the number or exercise price of such rights or
amount or nature of the stock or other securities or property receivable upon
exercise of such rights in the event of a combination, subdivision or
reclassification of any stock of the Corporation, a change in ownership of the
Corporation's stock or other securities or a reorganization, merger,
consolidation, sale of assets or other occurrence relating to the Corporation
or any stock of the Corporation, and provisions restricting the ability of the
Corporation to enter into any such transaction absent an assumption by the
other party or parties thereto of the obligations of the Corporation under
such rights;
(D) Provisions which deny the holder of a specified percentage of the
outstanding stock or other securities of the Corporation the right to exercise
such rights and/or cause the rights held by such holder to become void;
(E) Provisions which permit the Corporation to redeem or to exchange such
rights; and
(F) The appointment of a rights agent with respect to such rights.
ARTICLE XI
SECTION 203
The Corporation hereby elects to be governed by Section 203 of the DGCL.
* * *
APPENDIX E
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
BYLAWS
ARTICLE I--STOCKHOLDERS
Section 1. Annual Meeting.
(1) An annual meeting of the stockholders, for the election of directors to
succeed those whose terms expire and for the transaction of such other business
as may properly come before the meeting, shall be held at such place, on such
date, and at such time as the Board of Directors shall each year fix, which date
shall be within thirteen (13) months of the last annual meeting of stockholders.
(2) Nominations of persons for election to the Board of Directors and the
proposal of business to be transacted by the stockholders may be made at an
annual meeting of stockholders (a) pursuant to the Corporation's notice with
respect to such meeting, (b) by or at the direction of the Board of Directors or
(c) by any stockholder of record of the Corporation who was a stockholder of
record at the time of the giving of the notice provided for in the following
paragraph, who is entitled to vote at the meeting and who has complied with the
notice procedures set forth in this section.
(3) For nominations or other business to be properly brought before an
annual meeting by a stockholder pursuant to clause (c) of the foregoing
paragraph, (1) the stockholder must have given timely notice thereof in writing
to the Secretary of the Corporation, (2) such business must be a proper matter
for stockholder action under the General Corporation Law of the State of
Delaware (the "DGCL"), (3) if the stockholder, or the beneficial owner on
whose behalf any such proposal or nomination is made, has provided the
Corporation with a Solicitation Notice, as that term is defined in subclause
(c)(iii) of this paragraph, such stockholder or beneficial owner must, in the
case of a proposal, have delivered a proxy statement and form of proxy to
holders of at least the percentage of the Corporation's voting shares required
under applicable law to carry any such proposal, or, in the case of a nomination
or nominations, have delivered a proxy statement and form of proxy to holders of
a percentage of the Corporation's voting shares reasonably believed by such
stockholder or beneficial holder to be sufficient to elect the nominee or
nominees proposed to be nominated by such stockholder, and must, in either case,
have included in such materials the Solicitation Notice and (4) if no
Solicitation Notice relating thereto has been timely provided pursuant to this
section, the stockholder or beneficial owner proposing such business or
nomination must not have solicited a number of proxies sufficient to have
required the delivery of such a Solicitation Notice under this section. To be
timely, a stockholder's notice shall be delivered to the Secretary at the
principal executive offices of the Corporation not less than 45 or more than 75
days prior to the first anniversary (the "Anniversary") of the date on which
the Corporation first mailed its proxy materials for the preceding year's annual
meeting of stockholders; provided, however, that if the date of the annual
meeting is advanced more than 30 days prior to or delayed by more than 30 days
after the anniversary of the preceding year's annual meeting, notice by the
stockholder to be timely must be so delivered not later than the close of
business on the later of (i) the 90th day prior to such annual meeting or (ii)
the 10th day following the day on which public announcement of the date of such
meeting is first made. Such stockholder's notice shall set forth (a) as to each
person whom the stockholder proposes to nominate for election or reelection as a
director (x) all information relating to such person as would be required to be
disclosed in solicitations of proxies for the election of such nominees as
directors pursuant to Regulation 14A under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), (y) whether the stockholder proposes to
nominate such person to be an Independent Director (as defined in Section 1 of
Article II of these Bylaws), a Class B Director or the Chairman Director (as
such terms are defined in Section (A) of Article VI of the Certificate of
Incorporation) and, if applicable, a statement that such person satisfies the
applicable criteria for Independent Directors or Class B Directors, as
applicable, and (z) such person's written consent to serve as
a director if elected and, if applicable, a written undertaking to promptly
provide to the Secretary of the Corporation upon request any information that
the Corporation deems to be relevant to the determination of whether such person
satisfies the applicable criteria for Independent Directors or Class B
Directors, as applicable; (b) as to any other business that the stockholder
proposes to bring before the meeting, a brief description of such business, the
reasons for conducting such business at the meeting and any material interest in
such business of such stockholder and the beneficial owner, if any, on whose
behalf the proposal is made; (c) as to the stockholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination or proposal is made (i)
the name and address of such stockholder, as they appear on the Corporation's
books, and of such beneficial owner, (ii) the class and number of shares of the
Corporation that are owned beneficially and of record by such stockholder and
such beneficial owner, and (iii) whether either such stockholder or beneficial
owner intends to deliver a proxy statement and form of proxy to holders of, in
the case of a proposal, at least the percentage of the Corporation's voting
shares required under applicable law to carry the proposal or, in the case of a
nomination or nominations, a sufficient number of holders of the Corporation's
voting shares to elect such nominee or nominees (an affirmative statement of
such intent, a "Solicitation Notice").
(4) Notwithstanding anything in the second sentence of the third paragraph
of this Section 1 to the contrary, in the event that the number of directors to
be elected to the Board of Directors is increased and there is no public
announcement naming all of the nominees for director or specifying the size of
the increased Board of Directors made by the Corporation at least 55 days prior
to the Anniversary, a stockholder's notice required by this Bylaw shall also be
considered timely, but only with respect to nominees for any new positions
created by such increase, if it shall be delivered to the Secretary at the
principal executive offices of the Corporation not later than the close of
business on the 10th day following the day on which such public announcement is
first made by the Corporation.
(5) Only persons nominated in accordance with the procedures set forth in
this Section 1 shall be eligible to serve as directors and only such business
shall be conducted at an annual meeting of stockholders as shall have been
brought before the meeting in accordance with the procedures set forth in this
section. The chairman of the meeting shall have the power and the duty to
determine whether a nomination or any business proposed to be brought before the
meeting has been made in accordance with the procedures set forth in these
Bylaws and, if any proposed nomination or business is not in compliance with
these Bylaws, to declare that such defectively proposed business or nomination
shall not be presented for stockholder action at the meeting and shall be
disregarded.
(6) For purposes of these Bylaws, "public announcement" shall mean
disclosure in a press release reported by the Dow Jones News Service, Associated
Press or a comparable national news service or in a document publicly filed by
the Corporation with the Securities and Exchange Commission pursuant to Section
13, 14 or 15(d) of the Exchange Act.
(7) Notwithstanding the foregoing provisions of this Section 1, a
stockholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to matters set forth
in this Section 1. Nothing in this Section 1 shall be deemed to affect any
rights of stockholders to request inclusion of proposals in the Corporation's
proxy statement pursuant to Rule 14a-8 under the Exchange Act.
Section 2. Special Meetings.
(1) Special meetings of the stockholders, other than those required by
statute, may be called only by the Chairman of the Board or the President of the
Corporation or by the Board of Directors acting pursuant to a resolution adopted
by a majority of the Whole Board. For purposes of these Bylaws, the term "Whole
Board" shall mean the total number of authorized directors whether or not there
exist any vacancies in previously authorized directorships. The Board of
Directors may postpone or reschedule any previously scheduled special meeting.
(2) Only such business shall be conducted at a special meeting of
stockholders as shall have been brought before the meeting pursuant to the
Corporation's notice of meeting. The chairman of the meeting shall have the
power and the duty to determine whether a nomination or any business proposed to
be brought before the meeting has been made in accordance with the procedures
set forth in these Bylaws and, if any proposed nomination or business is not in
compliance with these Bylaws, to declare that such defectively proposed business
or nomination shall not be presented for stockholder action at the meeting and
shall be disregarded. Nominations of persons for election to the Board of
Directors may be made at a special meeting of stockholders at which directors
are to be elected pursuant to the Corporation's notice of meeting (a) by or at
the direction of the Board of Directors or (b) by any stockholder of record of
the Corporation who is a stockholder of record at the time of giving of notice
provided for in this paragraph, who shall be entitled to vote at the meeting and
who complies with the notice procedures set forth in Section 1 of this Article
I. Nominations by stockholders of persons for election to the Board of Directors
may be made at such a special meeting of stockholders if the stockholder's
notice required by the third paragraph of Section 1 of this Article I shall be
delivered to the Secretary at the principal executive offices of the Corporation
not later than the close of business on the later of the 90th day prior to such
special meeting or the 10th day following the day on which public announcement
is first made of the date of the special meeting and of the nominees proposed by
the Board of Directors to be elected at such meeting.
(3) Notwithstanding the foregoing provisions of this Section 2, a
stockholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to matters set forth
in this Section 2. Nothing in this Section 2 shall be deemed to affect any
rights of stockholders to request inclusion of proposals in the Corporation's
proxy statement pursuant to Rule 14a-8 under the Exchange Act.
Section 3. Notice of Meetings.
Notice of the place, if any, date, and time of all meetings of the
stockholders, and the means of remote communications, if any, by which
stockholders and proxy holders may be deemed to be present in person and vote at
such meeting, shall be given, not less than ten (10) nor more than sixty (60)
days before the date on which the meeting is to be held, to each stockholder
entitled to vote at such meeting, except as otherwise provided herein or
required by law (meaning, here and hereinafter, as required from time to time by
the Delaware General Corporation Law or the Certificate of Incorporation of the
Corporation).
When a meeting is adjourned to another time or place, notice need not be given
of the adjourned meeting if the time and place, if any, thereof, and the means
of remote communications, if any, by which stockholders and proxy holders may be
deemed to be present in person and vote at such adjourned meeting are announced
at the meeting at which the adjournment is taken; provided, however, that if the
date of any adjourned meeting is more than thirty (30) days after the date for
which the meeting was originally noticed, or if a new record date is fixed for
the adjourned meeting, notice of the place, if any, date, and time of the
adjourned meeting and the means of remote communications, if any, by which
stockholders and proxy holders may be deemed to be present in person and vote at
such adjourned meeting, shall be given in conformity herewith. At any adjourned
meeting, any business may be transacted which might have been transacted at the
original meeting.
Section 4. Quorum.
At any meeting of the stockholders, the holders of a majority of the voting
power of all of the shares of the stock entitled to vote at the meeting, present
in person or by proxy, shall constitute a quorum for all purposes, unless or
except to the extent that the presence of a larger number may be required by
law. Where a separate vote by a class or classes or series is required, the
holders of a majority of the voting power of all of the shares of such class or
classes or series entitled to participate in such separate vote, present in
person or by proxy, shall constitute a quorum entitled to take action with
respect to that vote on that matter.
If a quorum shall fail to attend any meeting, the chairman of the meeting may
adjourn the meeting to another place, if any, date, or time.
Section 5. Organization.
Such person as the Board of Directors may have designated or, in the absence
of such a person, the Chairman of the Board or, in his or her absence, the
President of the Corporation or, in his or her absence, such person as may be
chosen by the holders of a majority of the voting power of the shares entitled
to vote who are present, in person or by proxy, shall call to order any meeting
of the stockholders and act as chairman of the meeting. In the absence of the
Secretary of the Corporation, the secretary of the meeting shall be such person
as the chairman of the meeting appoints.
Section 6. Conduct of Business.
The chairman of any meeting of stockholders shall determine the order of
business and the procedure at the meeting, including such regulation of the
manner of voting and the conduct of discussion as seem to him or her in order.
The chairman shall have the power to adjourn the meeting to another place, if
any, date and time. The date and time of the opening and closing of the polls
for each matter upon which the stockholders will vote at the meeting shall be
announced at the meeting.
Section 7. Proxies and Voting.
At any meeting of the stockholders, every stockholder entitled to vote may
vote in person or by proxy authorized by an instrument in writing or by a
transmission permitted by law filed in accordance with the procedure established
for the meeting. Any copy, facsimile telecommunication or other reliable
reproduction of the writing or transmission created pursuant to this paragraph
may be substituted or used in lieu of the original writing or transmission for
any and all purposes for which the original writing or transmission could be
used, provided that such copy, facsimile telecommunication or other reproduction
shall be a complete reproduction of the entire original writing or transmission.
The Corporation may, and to the extent required by law, shall, in advance of
any meeting of stockholders, appoint one or more inspectors to act at the
meeting and make a written report thereof. The Corporation may designate one or
more alternate inspectors to replace any inspector who fails to act. If no
inspector or alternate is able to act at a meeting of stockholders, the person
presiding at the meeting may, and to the extent required by law, shall, appoint
one or more inspectors to act at the meeting. Each inspector, before entering
upon the discharge of his or her duties, shall take and sign an oath faithfully
to execute the duties of inspector with strict impartiality and according to the
best of his or her ability. Every vote taken by ballots shall be counted by a
duly appointed inspector or inspectors.
All elections shall be determined by a plurality of the votes cast, and except
as otherwise required by law, all other matters shall be determined by a
majority of the votes cast affirmatively or negatively.
Section 8. Stock List.
A complete list of stockholders entitled to vote at any meeting of
stockholders, arranged in alphabetical order for each class of stock and showing
the address of each such stockholder and the number of shares registered in his
or her name, shall be open to the examination of any such stockholder for a
period of at least 10 days prior to the meeting in the manner provided by law.
The stock list shall also be open to the examination of any stockholder during
the whole time of the meeting as provided by law. This list shall presumptively
determine the identity of the stockholders entitled to vote at the meeting and
the number of shares held by each of them.
ARTICLE II--BOARD OF DIRECTORS
Section 1. Number, Election, Term and Qualifications of Directors.
The effectiveness of the amendment and restatement of these Bylaws shall not
change the size or composition of the Board of Directors of the Corporation.
Commencing with the election of directors at the first annual or special meeting
of stockholders following the Stock Conversion (as defined in the Certificate of
Incorporation), the number of directors shall be nine (9), plus any directors
who the holders of any series of preferred stock may be entitled to elect under
specified circumstances (hereinafter referred to as "Preferred Stock
Directors"). The directors, other than any Preferred Stock Directors, shall be
divided into three classes and shall serve for such terms and be subject to such
qualifications and requirements as are set forth in the Certificate of
Incorporation.
For purposes of these Bylaws and the Certificate of Incorporation,
"independent director" means a person other than an officer or employee of the
Corporation or it subsidiaries or any other individual having a relationship
which, in the opinion of the Board of Directors, would interfere with the
exercise of independent judgement in carrying out the responsibilities of a
director. The following persons shall not be considered independent:
(A) a director who is employed by the Corporation or any of its affiliates
for the current year or any of the past three years;
(B) a director who accepts any compensation from the corporation or any of
its affiliates in excess of $60,000 during the previous fiscal year, other
than compensation for board service, benefits under a tax-qualified retirement
plan, or non-discretionary compensation;
(C) a director who is a member of the immediate family of an individual who
is, or has been in any of the past three years, employed by the Corporation or
any of its affiliates as an executive officer. Immediate family includes a
person's spouse, parents, children, siblings, mother-in-law, father-in-law,
brother-in-law, sister-in-law, son-in-law, daughter-in-law and anyone who
resides in such person's home;
(D) a director who is a partner in, or a controlling stockholder or an
executive officer of, any for-profit business organization to which the
Corporation made, or from which the Corporation received, payments (other than
those arising solely from investments in the Corporation's securities) that
exceed 5% of the Corporation's or business organization's consolidated gross
revenues for that year, or $200,000, whichever is more, in any of the past
three years; and
(E) a director who is employed as an executive of another entity where any
of the Corporation's executives serve on that entity's compensation committee.
Section 2. Chairman of the Board.
The Chairman of the Board shall be the presiding officer at all meetings of
the Board of Directors and shall exercise such other powers and perform such
other duties as are delegated to him or her by the Board of Directors.
Section 3. Newly Created Directorships and Vacancies.
Subject to the rights of the holders of any series of preferred stock then
outstanding, newly created directorships resulting from any increase in the
authorized number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification, removal from
office or other cause shall, unless otherwise required by law or by resolution
of the Board of Directors, be filled only by a majority vote of the directors
then in office, though less than a quorum (and not by stockholders), and
directors so chosen shall hold office for a term expiring at the annual meeting
of stockholders at which the term of office of the class to which they have been
elected expires and until such director's successor shall have been duly elected
and qualified. No decrease in the number of authorized directors shall shorten
the term of any incumbent director.
Section 4. Regular Meetings.
Regular meetings of the Board of Directors shall be held at such place or
places, on such date or dates, and at such time or times as shall have been
established by the Board of Directors and publicized among all directors. A
notice of each regular meeting shall not be required.
Section 5. Special Meetings.
Special meetings of the Board of Directors may be called only by the Chairman
of the Board, the President of the Corporation or by a majority of the Whole
Board and shall be held at such place, on such date, and at such time as they or
he or she shall fix. Notice of the place, date, and time of each such special
meeting shall be given to each director by whom it is not waived by mailing
written notice not less than five (5) days before the meeting or by telephone or
by telegraphing or telexing or by facsimile or electronic transmission of the
same not less than twenty-four (24) hours before the meeting. Unless otherwise
indicated in the notice thereof, any and all business may be transacted at a
special meeting.
Section 6. Quorum.
At any meeting of the Board of Directors, a majority of the total number of
the Whole Board shall constitute a quorum for all purposes. If a quorum shall
fail to attend any meeting, a majority of those present may adjourn the meeting
to another place, date, or time, without further notice or waiver thereof.
Section 7. Participation in Meetings By Conference Telephone.
Members of the Board of Directors, or of any committee thereof, may
participate in a meeting of such Board of Directors or committee by means of
conference telephone or other communications equipment by means of which all
persons participating in the meeting can hear each other and such participation
shall constitute presence in person at such meeting.
Section 8. Conduct of Business.
At any meeting of the Board of Directors, business shall be transacted in such
order and manner as the Board of Directors may from time to time determine, and
all matters shall be determined by the vote of a majority of the directors
present, except as otherwise provided herein or required by law. Action may be
taken by the Board of Directors without a meeting if all members thereof consent
thereto in writing or by electronic transmission, and the writing or writings or
electronic transmission or transmissions are filed with the minutes of
proceedings of the Board of Directors. Such filing shall be in paper form if the
minutes are maintained in paper form and shall be in electronic form if the
minutes are maintained in electronic form.
Section 9. Compensation of Directors.
Unless otherwise restricted by the certificate of incorporation, the Board of
Directors shall have the authority to fix the compensation of the directors. The
directors may be paid their expenses, if any, of attendance at each meeting of
the Board of Directors and may be paid a fixed sum for attendance at each
meeting of the Board of Directors or paid a stated salary or paid other
compensation as director. No such payment shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed compensation
for attending committee meetings.
ARTICLE III--COMMITTEES
Section 1. Committees of the Board of Directors.
The Board of Directors may from time to time designate committees of the Board
of Directors, with such lawfully delegable powers and duties as it thereby
confers, to serve at the pleasure of the Board of Directors. The Board of
Directors shall elect a director or directors to serve as the member or members
of any such committee, designating, if it desires, other directors as alternate
members who may replace any absent or disqualified member at any meeting of the
committee. In the absence or disqualification of any member of any committee and
any alternate member in his or her place, the member or members of the committee
present at the meeting and not disqualified from voting, whether or not he or
she or they constitute a quorum, may by unanimous vote appoint another member of
the Board of Directors to act at the meeting in the place of the absent or
disqualified member.
Section 2. Conduct of Business.
Each committee may determine the procedural rules for meeting and conducting
its business and shall act in accordance therewith, except as otherwise provided
herein or required by law. Except as otherwise determined by the Board of
Directors, adequate provision shall be made for notice to members of all
meetings; one-third (1/3) of the members shall constitute a quorum unless the
committee shall consist of one (1) or two (2) members, in which event one (1)
member shall constitute a quorum; and all matters shall be determined by a
majority vote of the members present. Action may be taken by any committee
without a meeting if all members thereof consent thereto in writing or by
electronic transmission, and the writing or writings or electronic transmission
or transmissions are filed with the minutes of the proceedings of such
committee. Such filing shall be in paper form if the minutes are maintained in
paper form and shall be in electronic form if the minutes are maintained in
electronic form.
Section 3. Additional and Standing Committees.
In addition to such committees of the Board of Directors as may be authorized
from time to time, the Corporation shall have such additional and standing
committees, which shall be comprised of such persons having such powers and
duties, as provided in the Rules and Regulations of the Corporation or otherwise
determined by the Board of Directors. Any person may be disqualified from
serving on or participating in the affairs of any committee to the extent
provided in the Rules and Regulations.
ARTICLE IV--OFFICERS
Section 1. Generally.
The officers of the Corporation shall consist of a President (who shall also
be Chief Executive Officer), one or more Vice Presidents, a Secretary, a
Treasurer and such other officers as may from time to time be appointed by the
Board of Directors. Officers shall be elected by the Board of Directors, which
shall consider that subject at its first meeting after every annual meeting of
stockholders. Each officer shall hold office until his or her successor is
elected and qualified or until his or her earlier resignation or removal. Any
number of offices may be held by the same person. The salaries of officers
elected by the Board of Directors shall be fixed from time to time by the Board
of Directors or by such officers as may be designated by resolution of the Board
of Directors.
Section 3. President.
The President shall be the Chief Executive Officer of the Corporation. Subject
to the provisions of these By-laws and to the direction of the Board of
Directors, he or she shall have the responsibility for the general management
and control of the business and affairs of the Corporation and shall perform all
duties and have all
powers which are commonly incident to the office of chief executive or which are
delegated to him or her by the Board of Directors. He or she shall have power to
sign all stock certificates, contracts and other instruments of the Corporation
which are authorized and shall have general supervision and direction of all of
the other officers (other than Chairman of the Board), employees and agents of
the Corporation.
Section 4. Vice President.
Each Vice President shall have such powers and duties as may be delegated to
him or her by the Board of Directors. One (1) Vice President shall be designated
by the Board of Directors to perform the duties and exercise the powers of the
President in the event of the President's absence or disability.
Section 5. Treasurer.
The Treasurer shall have the responsibility for maintaining the financial
records of the Corporation. He or she shall make such disbursements of the funds
of the Corporation as are authorized and shall render from time to time an
account of all such transactions and of the financial condition of the
Corporation. The Treasurer shall also perform such other duties as the Board of
Directors may from time to time prescribe.
Section 6. Secretary.
The Secretary shall issue all authorized notices for, and shall keep minutes
of, all meetings of the stockholders and the Board of Directors. He or she shall
have charge of the corporate books and shall perform such other duties as the
Board of Directors may from time to time prescribe.
Section 7. Delegation of Authority.
The Board of Directors may from time to time delegate the powers or duties of
any officer to any other officers or agents, notwithstanding any provision
hereof.
Section 8. Removal.
Any officer of the Corporation may be removed at any time, with or without
cause, by the Board of Directors.
Section 9. Action with Respect to Securities of Other Corporations.
Unless otherwise directed by the Board of Directors, the President or any
officer of the Corporation authorized by the President shall have power to vote
and otherwise act on behalf of the Corporation, in person or by proxy, at any
meeting of stockholders of or with respect to any action of stockholders of any
other Corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other Corporation.
ARTICLE V--STOCK
Section 1. Certificates of Stock.
The shares of the Corporation shall be represented by certificates unless the
Board of Directors shall by resolution provide that some or all of any class or
series of stock shall be uncertificated shares. Any such resolution shall not
apply to shares represented by a certificate until the certificate is
surrendered to the Corporation. Notwithstanding the adoption of any resolution
providing for uncertificated shares, every holder of stock represented by
certificates and upon request every holder of uncertificated shares shall be
entitled to have a certificate signed by, or in the name of the Corporation by,
the Chairman or Vice Chairman of the Board of Directors, or the President or
Vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary
or an Assistant Secretary, representing the number of shares registered in
certificate form. The form of such certificates and the signatures thereon shall
comply with the requirements of the DGCL. Any or all of the signatures on the
certificate may be by facsimile.
Section 2. Transfers of Stock.
Transfers of stock shall be made only upon the transfer books of the
Corporation kept at an office of the Corporation or by transfer agents
designated to transfer shares of the stock of the Corporation. Except where a
certificate is issued in accordance with Section 4 of Article V of these By-
laws, an outstanding certificate for the number of shares involved shall be
surrendered for cancellation before a new certificate is issued therefor.
Section 3. Record Date.
In order that the Corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders, or to receive payment of
any dividend or other distribution or allotment of any rights or to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors may, except as
otherwise required by law, fix a record date, which record date shall not
precede the date on which the resolution fixing the record date is adopted and
which record date shall not be more than sixty (60) nor less than ten (10) days
before the date of any meeting of stockholders, nor more than sixty (60) days
prior to the time for such other action as hereinbefore described; provided,
however, that if no record date is fixed by the Board of Directors, the record
date for determining stockholders entitled to notice of or to vote at a meeting
of stockholders shall be at the close of business on the day next preceding the
day on which notice is given or, if notice is waived, at the close of business
on the day next preceding the day on which the meeting is held, and, for
determining stockholders entitled to receive payment of any dividend or other
distribution or allotment of rights or to exercise any rights of change,
conversion or exchange of stock or for any other purpose, the record date shall
be at the close of business on the day on which the Board of Directors adopts a
resolution relating thereto.
A determination of stockholders of record entitled to notice of or to vote at
a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.
Section 4. Lost, Stolen, Mutilated or Destroyed Certificates.
In the event of the loss, theft, mutilation or destruction of any certificate
of stock, another may be issued in its place pursuant to such regulations as the
Board of Directors may establish concerning proof of such loss, theft,
mutilation or destruction and concerning the giving of a satisfactory bond or
bonds of indemnity.
Section 5. Regulations.
The issue, transfer, conversion and registration of certificates of stock
shall be governed by such other regulations as the Board of Directors may
establish.
ARTICLE VI--NOTICES
Section 1. Notices.
If mailed, notice to stockholders shall be deemed given when deposited in the
mail, postage prepaid, directed to the stockholder at such stockholder's address
as it appears on the records of the Corporation. Without limiting the manner by
which notice otherwise may be given effectively to stockholders, any notice to
stockholders may be given by electronic transmission in the manner provided in
Section 232 of the DGCL.
Section 2. Waivers.
A written waiver of any notice, signed by a stockholder or director, or waiver
by electronic transmission by such person, whether given before or after the
time of the event for which notice is to be given, shall be deemed equivalent to
the notice required to be given to such person. Neither the business nor the
purpose of any meeting need be specified in such a waiver. Attendance at any
meeting shall constitute waiver of notice except attendance for the sole purpose
of objecting to the timeliness of notice.
ARTICLE VII--MISCELLANEOUS
Section 1. Facsimile Signatures.
In addition to the provisions for use of facsimile signatures elsewhere
specifically authorized in these Bylaws, facsimile signatures of any officer or
officers of the Corporation may be used whenever and as authorized by the Board
of Directors or a committee thereof.
Section 2. Corporate Seal.
The Board of Directors may provide a suitable seal, containing the name of the
Corporation, which seal shall be in the charge of the Secretary. If and when so
directed by the Board of Directors or a committee thereof, duplicates of the
seal may be kept and used by the Treasurer or by an Assistant Secretary or
Assistant Treasurer.
Section 3. Reliance upon Books, Reports and Records.
Each director, each member of any committee designated by the Board of
Directors, and each officer of the Corporation shall, in the performance of his
or her duties, be fully protected in relying in good faith upon the books of
account or other records of the Corporation and upon such information, opinions,
reports or statements presented to the Corporation by any of its officers or
employees, or committees of the Board of Directors so designated, or by any
other person as to matters which such director or committee member reasonably
believes are within such other person's professional or expert competence and
who has been selected with reasonable care by or on behalf of the Corporation.
Section 4. Fiscal Year.
The fiscal year of the Corporation shall be as fixed by the Board of
Directors.
Section 5. Time Periods.
In applying any provision of these Bylaws which requires that an act be done
or not be done a specified number of days prior to an event or that an act be
done during a period of a specified number of days prior to an event, calendar
days shall be used, the day of the doing of the act shall be excluded, and the
day of the event shall be included.
ARTICLE VIII--INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right to Indemnification.
Each person who was or is made a party or is threatened to be made a party to
or is otherwise involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (hereinafter a "proceeding"), by
reason of the fact that he or she is or was a director, officer, committee
member or employee of the Corporation or is or was serving at the request of the
Corporation as a director, officer, trustee, committee member or employee of
another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan
(hereinafter an "indemnitee"), whether the basis of such proceeding is alleged
action in an official capacity as a director, officer or trustee or in any other
capacity while serving as a director, officer or trustee, shall be indemnified
and held harmless by the Corporation to the fullest extent authorized by the
Delaware General Corporation Law, as the same exists or may hereafter be amended
(but, in the case of any such amendment, only to the extent that such amendment
permits the Corporation to provide broader indemnification rights than such law
permitted the Corporation to provide prior to such amendment), against all
expense, liability and loss (including attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid in settlement) reasonably incurred or
suffered by such
indemnitee in connection therewith; provided, however, that, except as provided
in Section 3 of this ARTICLE VIII with respect to proceedings to enforce rights
to indemnification, the Corporation shall indemnify any such indemnitee in
connection with a proceeding (or part thereof) initiated by such indemnitee only
if such proceeding (or part thereof) was authorized by the Board of Directors of
the Corporation.
Section 2. Right to Advancement of Expenses.
In addition to the right to indemnification conferred in Section 1 of this
ARTICLE VIII, an indemnitee shall also have the right to be paid by the
Corporation the expenses (including attorney's fees) incurred in defending any
such proceeding in advance of its final disposition (hereinafter an
"advancement of expenses"); provided, however, that, if the Delaware General
Corporation Law requires, an advancement of expenses incurred by an indemnitee
in his or her capacity as a director or officer (and not in any other capacity
in which service was or is rendered by such indemnitee, including, without
limitation, service to an employee benefit plan) shall be made only upon
delivery to the Corporation of an undertaking (hereinafter an "undertaking"),
by or on behalf of such indemnitee, to repay all amounts so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right to appeal (hereinafter a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section 2 or otherwise.
Section 3. Right of Indemnitee to Bring Suit.
If a claim under Section 1 or 2 of this ARTICLE VIII is not paid in full by
the Corporation within sixty (60) days after a written claim has been received
by the Corporation, except in the case of a claim for an advancement of
expenses, in which case the applicable period shall be twenty (20) days, the
indemnitee may at any time thereafter bring suit against the Corporation to
recover the unpaid amount of the claim. If successful in whole or in part in any
such suit, or in a suit brought by the Corporation to recover an advancement of
expenses pursuant to the terms of an undertaking, the indemnitee shall be
entitled to be paid also the expense of prosecuting or defending such suit. In
(i) any suit brought by the indemnitee to enforce a right to indemnification
hereunder (but not in a suit brought by the indemnitee to enforce a right to an
advancement of expenses) it shall be a defense that, and (ii) in any suit
brought by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the Corporation shall be entitled to recover such
expenses upon a final adjudication that, the indemnitee has not met any
applicable standard for indemnification set forth in the Delaware General
Corporation Law. Neither the failure of the Corporation (including its directors
who are not parties to such action, a committee of such directors, independent
legal counsel, or its stockholders) to have made a determination prior to the
commencement of such suit that indemnification of the indemnitee is proper in
the circumstances because the indemnitee has met the applicable standard of
conduct set forth in the Delaware General Corporation Law, nor an actual
determination by the Corporation (including its directors who are not parties to
such action, a committee of such directors, independent legal counsel, or its
stockholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or brought by the Corporation to recover an advancement of expenses pursuant to
the terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to such advancement of expenses, under this
ARTICLE VIII or otherwise shall be on the Corporation.
Section 4. Non-Exclusivity of Rights.
The rights to indemnification and to the advancement of expenses conferred in
this ARTICLE VIII shall not be exclusive of any other right which any person may
have or hereafter acquire under any statute, the Corporation's Certificate of
Incorporation, Bylaws, agreement, vote of stockholders or directors or
otherwise.
Section 5. Insurance.
The Corporation may maintain insurance, at its expense, to protect itself and
any director, officer, employee or agent of the Corporation or another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the Corporation would have the power
to indemnify such person against such expense, liability or loss under the DGCL.
Section 6. Indemnification of Employees and Agents of the Corporation.
The Corporation may, to the extent authorized from time to time by the Board
of Directors, grant rights to indemnification and to the advancement of expenses
to any employee or agent of the Corporation to the fullest extent of the
provisions of this Article with respect to the indemnification and advancement
of expenses of directors and officers of the Corporation.
Section 7. Nature of Rights.
The rights conferred upon indemnitees in this ARTICLE VIII shall be contract
rights and such rights shall continue as to an indemnitee who has ceased to be a
director, officer or trustee and shall inure to the benefit of the indemnitee's
heirs, executors and administrators. Any amendment, alteration or repeal of this
ARTICLE VIII that adversely affects any right of an indemnitee or its successors
shall be prospective only and shall not limit or eliminate any such right with
respect to any proceeding involving any occurrence or alleged occurrence of any
action or omission to act that took place prior to such amendment or repeal.
ARTICLE IX--RULES AND REGULATIONS
The Corporation shall have such Rules and Regulations governing the business
and affairs of the Corporation as shall be determined by the Board of Directors
from time to time. Except as otherwise provided in the Certificate of
Incorporation of the Corporation, the Board of Directors shall have the power to
adopt, amend or repeal such Rules and Regulations.
ARTICLE X--AMENDMENTS
Subject to Section C(2) of Article IV of the Certificate of Incorporation, the
Board of Directors is expressly empowered to adopt, amend or repeal the Bylaws
of the Corporation. Any adoption, amendment or repeal of the Bylaws of the
Corporation by the Board of Directors shall require the approval of a majority
of the Whole Board. The stockholders shall also have power to adopt, amend or
repeal the Bylaws of the Corporation; provided, however, that subject to
Sections B(1) and C(2) of Article IV of the Certificate of Incorporation,
pursuant to which only holders of Series B-1 and Series B-2 Class B common stock
are entitled to vote on certain matters, any adoption, amendment or repeal of
the Bylaws of the Corporation by the stockholders shall require the affirmative
vote of the holders of at least sixty six and two-thirds percent (66 2/3%) of
the voting power of all of the then-outstanding shares of stock of the
Corporation entitled to vote generally in the election of directors, voting
together as a single class.
[Enlarge/Download Table]
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Chapter 1
Government
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Ch1 Committees...................................................................................... ---
157.00 Business Conduct Committee...................................................... ---
158.00 Floor Governors Committee....................................................... ---
159.00 Membership Committee............................................................ ---
159.01 Membership Committee Panels..................................................... ---
162.09 Strategy Committee.............................................................. ---
163.00 Investigating Committee......................................................... ---
165.01 Regulatory Compliance Committee................................................. ---
165.02 Audit Committee................................................................. ---
Ch1 Departments..................................................................................... ---
170.00 Departments..................................................................... ---
170.01 Office of Investigations and Audits............................................. ---
170.02 Office of Investigations and Audits............................................. ---
170.03 Department of Member Services................................................... ---
170.04 Department of Member Services................................................... ---
170.05 Department of Member Services................................................... ---
170.07 Market Report Department........................................................ ---
Ch1 General......................................................................................... ---
180.00 Emergencies..................................................................... ---
180.01 Physical Emergencies............................................................ ---
180.02 Emergency Actions Under Rule 180.00............................................. ---
181.00 Retirement...................................................................... ---
184.00 Appropriations.................................................................. ---
185.00 Repealing Clause................................................................ ---
186.00 Liability Under Previous Rules and Regulations.................................. ---
188.01 Governing Members Possessing Material, Non-Public Information................... ---
188.02 Service on Board of Directors, Disciplinary Committees, Oversight
Committees and Arbitration Panels............................................... ---
188.03 Exchange Liability.............................................................. ---
188.04 Voting by Interested Members.................................................... ---
188.05 Board's Interpretive Authority.................................................. ---
189.01 Limitation of Liability of Index Licensors or Administrators.................... ---
189.02 Limitation of Liability......................................................... ---
190.00 Compensation Information........................................................ ---
Ch1 Committees
157.00 Business Conduct Committee - (See 542.00) (08/01/94)
158.00 Floor Governors Committee - (See 543.00) (08/01/94)
159.00 Membership Committee - All applications for membership shall be referred
to the Membership Committee. The Membership Committee, in its discretion, may
require an applicant who resides in the continental United States to appear in
person for an examination either before the full committee, a duly authorized
subcommmittee thereof, or a representative of the Member Services Department.
The Committee may also impose different requirements for other applicants in
lieu of personal appearance.
The Membership Committee may, at its discretion, require the personal appearance
and examination of the sponsors. The Membership Committee, by a majority vote of
its members present at a duly constituted meeting, shall approve or deny the
admission of the applicant to membership. A decision of the Membership Committee
to deny the application may be appealed to the Regulatory Compliance Committee.
102 (08/01/94)
159.01 Membership Committee Panels - The Chairman of the Membership Committee
may appoint panels of Committee members to hold duly constituted meetings, in
accordance with Rule 159.00, for the purpose of approving or denying
applications for membership. Any such panel must consist of not fewer than three
members of the Committee. (08/01/94)
160.00 Committee of Arbitration; Committee of Appeals - (See 600.00) (08/01/94)
Ch1 Committees
--------------
163.00 Investigating Committee - (See 541.00) (08/01/94)
165.01 Regulatory Compliance Committee - The Chairman of the Board, with the
approval of the Board, shall appoint a Regulatory Compliance Committee, which
shall be comprised of the following voting members:
- Seven members of the Board, all of whom shall be Full Members or
Associate Members; and
- The chairmen of the Arbitration, Business Conduct, Financial
Compliance, Floor Conduct, Floor Governors and Membership
Committees.
Each year the Chairman of the Board shall appoint, from among the Board members
on the Committee, the Chairman of the Regulatory Compliance Committee for a
one-year term, provided that the term of the first Committee chairman so
appointed shall expire in January 1995.
The Regulatory Compliance Committee shall be responsible for (a) the approval of
legislative priorities and responses to legislative and regulatory initiatives;
(b) the determination of membership capital requirements; (c) the establishment
of risk management policies; (d) the establishment of membership criteria; (e)
hearing appeals from denials of membership applications; (f) the monitoring of
compliance policies; and (g) establishing ranges for penalties and fines for
violations of the Rules and Regulations of the Association.
The Committee shall instruct the Office of Investigations and Audits to
administer a statement of Member's Rights to each member (or employee of a
member) who is the subject of an investigation. (See below.)
Members of the Committee shall be appointed by the Chairman of the Board with
the approval of the Board. The Chairman of the Board, with the approval of the
Board, shall fill any vacancy in the Board members serving on the Committee by
appointing another member of the Board to serve on the Committee.
Ch1 Committees
--------------
STATEMENT OF MEMBER'S RIGHTS
APPURTENANT TO EXCHANGE PROCEEDINGS
The Chicago Board of Trade "Exchange" or CBOT") is a self-regulatory
organization subject to supervisory regulation of the Commodity Futures Trading
Commission ("CFTC"). In order to fulfill its self-regulatory obligations the
Exchange is required by the CFTC to undertake certain surveillance activities
and to maintain an enforcement staff that prosecutes possible violations of
Exchange rules before Exchange committees. At the CBOT these responsibilities
are carried out by the Office of investigations and Audits ("OIA") pursuant to
CBOT Regulations 170.01 and 170.02.
Investigations may be initiated by staff,, members, the CFTC of
the public. When an investigation is completed, an Investigations Report
concerning the alleged violation is prepared and submitted to the appropriate
Exchange disciplinary committee for review and action. An Investigation Report
is a privileged document and not subject to disclosure, although the essential
elements of an Investigative Report include a summary of the case and evidence
gathered by OIA, along with an OIA recommendation on whether to proceed.
A member, member firm or any other person subject to questioning
during an investigation is afforded the following rights, in addition to those
rights contained in Chapter 5 of the Exchange Rulebook:
1) The right to be represented by counsel during questioning and at any
subsequent proceeding before an Exchange committee. Regulation
540.03(g).
2) The right to be informed of the general act or conduct which is the
subject of the investigation, in so far as is determinable at the time
of questioning.
3) The right not to answer any question, if the answer would convict or
tend to convict the person of any State of Federal law. Rule 548.00.
4) The right to examine any statements or documents which are relevant to
the issued charges, excluding privileged work product and the
Investigative Report. Regulation 540.03(a).
5) The right to call relevant witnesses at any hearing and, for those
witnesses within the jurisdiction of the Association, compel their
attendance.
6). The right of one peremptory (for no reason) challenge to the presence of
a member of an Exchange disciplinary committee impaneled to hear the
matter and unlimited challenges for cause.
In addition, members, member firms or any other persons subject to questioning
during an investigation should be aware that Section 9(a)(4) of the Commodity
Exchange Act makes it a felony to willfully falsify or conceal a material fact,
to make a false, fictitious or fraudulent statement, or to knowingly make or use
a false document to any representative of the Exchange, including OIA employees,
who are performing their official duties.
I hereby acknowledge that I have read this Statement of Member's Rights this
______ day of ________, 20 ________.
___________________________________________
02/01/96
Ch1 Departments
170.01 Office of Investigations and Audits - Under authority of Rule 170.00
there is established a Department of the Association to be known as the Office
of Investigations and Audits. The Office shall function under the supervision of
an individual who shall be at least a Vice President of the Association. The
Office of Investigations and Audits shall initiate and conduct investigations
and audits on behalf of the President and Chief Executive Officer and on behalf
of the Association. No employee of such office shall have any interest in the
business of any member, member firm, or other person with trading privileges.
The individual who supervises such Office shall function also as a liaison
officer between the Business Conduct Committee and the Financial Compliance
Committee and the Commodity Futures Trading Commission. 1785 (08/01/94)
170.02 Office of Investigations and Audits - All officers, committees and
departments of the Association shall be entitled to use and shall make the
fullest possible use of the services provided by the Office of Investigations
and Audits consistent with their respective responsibilities and special needs,
and the President shall work out and establish policies and procedures governing
the initiation and handling of needed investigations and audits. All such
policies and procedures shall be consistent with and not in conflict with the
following declared policies of the Board:
(a) All information obtained by the Office of Investigations and Audits
regarding market positions and identity of traders shall be considered
confidential, regardless of source, and shall be disclosed only to the
Chairman or acting Chairman of the Business Conduct Committee and/or the
Financial Compliance Committee and shall be disclosed to the Business
Conduct Committee and/or the Financial Compliance Committee sitting as a
committee when and after the individual in charge of the Office of
Investigations and Audits or the Chairman or acting Chairman of the
Business Conduct Committee and/or the Financial Compliance Committee
shall have reason to believe that such Committee would or should take
preventive or disciplinary action if such information were presented to
it. This shall not preclude the Business Conduct Committee and/or the
Financial Compliance Committee from ordering investigations or audits to
be made at any time for the special purpose of obtaining information
regarding the market position and identity of any trader or traders, and
in such cases the Office of Investigations and Audits shall report fully
and completely to the Committee any and all such information so obtained
or in its possession.
(b) It shall be considered a breach of trust for any employee of the Office
of Investigations and Audits to divulge, or allow or cause to be
divulged, to any unauthorized person, any confidential, commercially
sensitive, or non-public information, including any information regarding
the market position, financial condition, or identity of any trader or
firm or to disclose the name of any customer of one firm to any other
firm, except as provided for in paragraph (a) hereof or when required in
connection with disciplinary proceedings or other formal proceedings or
actions of a duly authorized committee of the Association or of the
Board, or in response to a duly authorized subpoena, or in response to a
request or demand by any administrative or legislative body of government
having jurisdiction of the subject matter and authority to obtain the
information requested, or on behalf of the Association in any proceeding
authorized by the Board of Directors. Such information shall not be
divulged by any employee of the Office of Investigations and Audits
without the prior approval of the individual responsible for supervision
of the Office of Investigations and Audits. 1786 (08/01/94)
170.03 Department of Member Services - Under the authority of Rule 170.00
there is established a Department of Member Services. The function of such
Department shall be (1) to act in accordance with Regulations of the Board and
policies and procedures established by the Membership Committee and (2) to
develop and process information in behalf of the Board, the Membership
Committee, the Business Conduct Committee and all other Committees and
Departments of the Association. The services of such Department shall not,
however, be used in connection with the investigation of market positions nor
shall it demand information from which knowledge of market
Ch1 Departments
---------------
positions could be obtained. The Department shall function under the supervision
of a Vice President who shall be a full time employee of the Association. No
employee of such Department shall have an interest in the business of any member
or member firm. 1787 (08/01/94)
170.04 Department of Member Services - Any irregularities that may be found
by the Department incidental to its routine analysis of financial statements
shall be immediately reported to the Financial Compliance Committee. Except as
otherwise provided, all financial information obtained by the Department shall
be considered confidential and shall be disclosed only to the appropriate
committee or department requesting the information or to an Officer of the
Association. 1788 (08/01/94)
170.05 Department of Member Services - The Board, Committees and Departments
of the Association shall make the fullest possible use of the services provided
by the Department of Member Services consistent with their respective
responsibilities and special needs, and in cooperation with such Department
shall work out and establish policies and procedures governing the use of such
services. 1789 (08/01/94)
170.07 Market Report Department - The records and reports of the Market
Report Department shall be considered and treated as portions of the official
records of the Association and may not be given out or disseminated except
pursuant to the conditions and restrictions prescribed by these Regulations.
The Exchange shall have charge of all matters relating to collection,
dissemination, and use of quotations in connection with commodities or
securities. It shall have the power to approve or disapprove any application for
quotation service to a non-member or to telephonic or telegraphic wire or
wireless connection between the office of a member or a member's firm and the
office of any corporation, firm, or individual not a member of the Association
transacting a banking or brokerage business and it shall have power at any time
to disapprove the furnishing of any such quotation service or any such wire or
wireless connection and to require the discontinuance thereof. It may inquire
into wire or wireless connections of every kind whatsoever between the office of
a member and any member or non-member, and may require the discontinuance of any
such connection. 1030 (08/01/94)
Ch1 General
180.00 Emergencies
(a) The Board, upon the affirmative vote of two-thirds of the members voting
at a meeting where a quorum is deemed present and at least one-third of
the full Board is physically present, may adopt an emergency Regulation
or Resolution which shall supersede and supplant all contrary or
inconsistent Rules, Regulations, Resolutions or Rulings. Notice of the
adoption of an emergency Regulation or Resolution shall be posted
promptly on the floor of the Exchange.
(b) An emergency Regulation or Resolution shall expire upon the happening of
any of the following events:
(i) the Board shall have voted to rescind the emergency Regulation or
Resolution in the same manner as for its adoption;
(ii) the Commodity Futures Trading Commission shall have failed to
authorize the extension of the emergency Regulation or Resolution
within thirty (30) days after its adoption for a period not to
exceed sixty (60) additional days; or
(iii) the Board or the Members of the Association shall have failed to
adopt the emergency Regulation or Resolution in accordance with
Rules 107.00 or 132.00 during the time period when the emergency is
in effect.
(c) All Exchange contracts shall be subject to the exercise of these
emergency powers by the Board as well as the exercise by the Clearing
House of the powers reserved to it by its charter, bylaws and
resolutions.
(d) The Term "emergency" shall include all emergency circumstances now or
hereafter referenced in the Commodity Exchange Act and the regulations of
the Commodity Futures Trading Commission thereunder, and all other
circumstances in which an emergency can lawfully be declared by the
Board.
(e) Except as otherwise stated in an emergency Regulation or Resolution
adopted hereunder, the powers exercised by the Board under this Rule
shall be in addition to and not in derogation of the authority granted by
the Rules and Regulations to a committee or officer of the Association to
take action as specified therein. (08/01/94)
180.01 Physical Emergencies - In the event the physical functions of the
Association are, or are threatened to be, severely and adversely affected by a
physical emergency such as but not limited to fire or other casualty, bomb
threats, substantial inclement weather, power failures, communications or
automated system breakdowns, or transportation breakdowns, either the Chairman,
the President, or in their absence a member of the Executive Committee or
another officer of the Exchange, is authorized to take such action as he shall
deem necessary or appropriate to deal with such emergency including but not
limited to suspending trading, provided that no trading suspension shall
continue for more than five days without the approval of the Board under Rule
180.00; restoring trading; temporarily extending, limiting or changing the hours
of trading; and extending the last day of trading and the delivery dates for
expiring contracts. In addition, an officer of the Exchange, or his designee,
may take such action as he shall deem necessary or appropriate to deal with a
physical emergency, even if the Chairman and the President are not absent, if
such authority has been delegated by the Chairman and the President. (06/01/00)
180.02 Emergency Actions Under Rule 180.00 - Pursuant and subject to the
provisions of Rule 180.00, the Board may take or direct such actions as it deems
necessary or appropriate to meet an emergency, including but not limited to such
actions as:
(a) limited trading to liquidation only, in whole or in part;
(b) limited trading to liquidation only, except new sales for delivery;
(c) extending or shortening the time for the expiration of trading;
(d) extending the time for delivery;
(e) ordering liquidation of contracts;
(f) ordering the fixing of settlement prices;
(g) ordering the reduction of positions;
(h) ordering the transfer of positions, and the money, securities and property
securing such positions, held on behalf of customers by a member, to
another member or members willing to assume such positions;
(i) extending, limiting or changing the hours of trading;
(j) suspending trading;
(k) changing or removing daily price fluctuation limits;
(l) modifying or suspending any of the Rules and Regulations. (08/01/94)
181.00 Retirement - The Board is authorized to adopt, maintain, amend, and
terminate, from time to time, a plan or plans for the retirement of employees of
the Association and its wholly owned subsidiary corporations and for the payment
of pensions to such retired employees; provided, however that no such plan or
plans shall be applicable to employees who are covered by a collective
bargaining agreement pension plan; and provided, further, that no retired
employee now receiving retirement compensation shall have his combined
Government assistance and retirement compensation which was in effect prior to
September 1, 1950, reduced as a result of any such plan or plans. 76 (08/01/94)
184.00 Appropriations - There shall be no appropriation of money or property
of the Association except for the purpose of its legitimate business or to
promote the purposes of its organization. 601 (08/01/94)
185.00 Repealing Clause - These Rules shall be effective upon such days as
may be proclaimed by the Board. Upon the taking effect of these Rules, all
former Rules and Regulations shall be repealed, except as herein provided, and
except that prior transactions shall be governed by the Rules previously in
effect. 606 (08/01/94)
186.00 Liability Under Previous Rules and Regulations - The provisions of the
Rules and Regulations in force immediately prior to the adoption of these Rules
and Regulations shall be superseded hereby, except that such adoption shall not
affect the liability of any member of the Association for any offense
theretofore committed, or any rights or liabilities theretofore acquired or
incurred. 607 (08/01/94)
188.01 Governing Members Possessing Material, Non-Public Information - No
member of the Association who is a member of the Board of Directors or a
Committee of the Association knowingly shall use or disclose, for any purpose
other than the performance of such member's official duties as a member of the
Board of Directors or any such Committee, material, non-public information
obtained as a result of such member's participation on the Board of Directors or
any such committee. (08/01/94)
188.02 Service on Board of Directors, Disciplinary Committees, Oversight
Committees and Arbitration Panels - No person shall serve on any disciplinary
committee (i.e., Appellate Committee, Business Conduct Committee, Financial
Compliance Committee, Floor Governors Committee, Floor Conduct Committee or
Hearing Committee), oversight committee (i.e. Regulatory Compliance Committee),
arbitration panel or the Board of Directors of the Association:
1) who is found by a final decision or settlement agreement (or absent a
finding in the settlement agreement if any acts charged included a
disciplinary offense) to have committed a disciplinary offense, as defined
in Commodity Futures Trading Commission ("Commission") Regulation 1.63 (a)
(6); or
2) whose Commission registration in any capacity has been revoked or suspended;
or
3) who is subject to an agreement with the Commission or any self-regulatory
organization not to apply for registration; or
4) who is subject to a denial, suspension or disqualification from serving on a
disciplinary committee,
oversight committee, arbitration panel or governing board of any self-
regulatory organization as that term is defined in Section 3(a)(26) of the
Securities Exchange Act of 1934; or
5) who has been convicted of any felony listed in Section 8a(2) (D) (ii)
through (iv) of the Commodity Exchange Act;
for a period of three years from the date of such final decision or for such
time as the person remains subject to any suspension, expulsion or has failed to
pay any portion of a fine imposed for committing a disciplinary offense,
whichever is longer.
All terms used herein shall be defined consistent with Commission Regulation
1.63(a). (11/01/94)
188.03 Exchange Liability -
A. Except as provided in the Commodity Exchange Act and/or the regulations
of the Commodity Futures Trading Commission, and except in instances
where there has been a finding of willful or wanton misconduct, gross
negligence, bad faith or fraudulent or criminal acts, in which case the
party found to have engaged in such misconduct cannot invoke the
protection of this provision, neither the Exchange nor any of its
directors, officers, employees, agents or consultants shall have or
incur any liability whatsoever to its members, any persons associated
therewith, their customers or any third parties related thereto or their
successors, assigns, or representatives, for any loss, damage, cost,
claims or expense (including but not limited to indirect, incidental or
consequential damages) that arise out of the use or enjoyment of the
facilities or services afforded by the Exchange, any interruption in or
failure or unavailability of any a such facilities or services, any
action taken or omitted to be taken with respect to the business of the
Exchange or any information or data provided or withheld by the
Exchange. Such limitation of liability shall apply to all claims,
whether in contract, tort, negligence, strict liability or otherwise.
The Exchange makes no warranty, express or implied, as to the results to
be obtained by any person or entity from the use of any data or
information transmitted or disseminated by or on behalf of the Exchange.
The Exchange makes no express or implied warranties of merchantability
or fitness for a particular purpose or use with respect to any data or
information transmitted or disseminated by or on behalf of the Exchange.
B. Subject to the limitations set forth above, neither the Exchange nor any
of its directors, officers, employees, agents or consultants shall have
or incur any liability whatsoever to its members, their customers or any
third parties associated therewith, or their successors, assigns, or
representatives, for any loss, damage, cost or expense (including but
not limited to indirect, incidental or consequential damages) incurred
by members or customers as a result of any failure, malfunction, fault,
delay, omission, inaccuracy, interruption or termination of service in
connection with the furnishing, performance, operation, maintenance or
use of or inability to use all or any part of any Exchange systems. Such
limitation of liability shall apply regardless of the cause of such
systems failure even if due to Exchange error, omission or negligence.
Further, such limitation of liability shall apply to all claims, whether
in contract, tort, negligence, strict liability or otherwise.
Additionally, the Exchange, its directors, officers, employees, agents
or consultants shall have or incur absolutely no liability whatsoever
for any errors or inaccuracies in information provided by any Exchange
systems or for any losses resulting from unauthorized access or any
other misuse of any Exchange systems by any person.
C. As used in this regulation, the term "systems" includes, but is not
limited to, electronic order entry/delivery, trading through any
electronic means, electronic communication of market data or
information, workstations used by members and authorized employees of
members, price reporting systems and any and all terminals,
communications networks, central computers, software, hardware, firmware
and printers relating thereto.
D. As used in this regulation, the term "Exchange" shall mean the Board of
Trade of the City of Chicago, as well as any entity in which the Board
of Trade is now or will become a general partner, a member, or a
shareholder, including but not limited to Ceres Trading Limited
Partnership, C.B.T. Corporation, and Chicago Board Brokerage, Inc.
(08/01/97)
188.04 Voting by Interested Members -
(a) Definitions. For purposes of this section:
(1) "Disciplinary Committee" means any person or committee of persons, or
any subcommittee thereof, that is authorized by the Association to
issue disciplinary charges, to conduct disciplinary proceedings, to
settle disciplinary charges, to impose disciplinary sanctions, or to
hear appeals thereof in cases involving any violation of the rules of
the Association except those cases where the person or committee is
authorized summarily to impose minor penalties for violating rules
regarding decorum, attire, the timely submission of accurate records
for clearing or verifying each day's transactions or other similar
activities.
(2) A person's "family relationship" means the person's spouse, former
spouse, parent, stepparent, child, stepchild, sibling, stepbrother,
stepsister, grandparent, grandchild, uncle, aunt, nephew, niece or in-
law.
(3) "Governing board" means the Board of Directors, or any subcommittee
thereof, duly authorized pursuant to the rules and regulations of the
Association that have been approved by the CFTC or have become
effective pursuant to Section 5a(a)(12)(A) of the Act to take action
or to recommend the taking of action on behalf of the Association.
(4) "Oversight panel" means any panel, or any subcommittee thereof,
authorized by the Association to recommend or establish policies or
procedures with respect to the Association's surveillance, compliance,
rule enforcement, or disciplinary responsibilities.
(5) "Member's affiliated firm" is a firm in which the member is a
"principal", as defined in CFTC Regulation 3.1(a), or an employee.
(6) "Named party in interest" means a person or entity that is identified
by name as a subject of any matter being considered by a governing
board, disciplinary committee or oversight panel.
(7) "Significant action" includes any of the following types of self-
regulatory organization actions on rule changes than can be
implemented without the CFTC's prior approval:
(i) any actions or rule changes which address an "emergency" as
defined in CFTC Regulation 1.41(a)(4)(i) through (iv) and
(vi) through (viii); and
(ii) any changes in margin levels that are designed to respond
to extraordinary market conditions such as an actual or
attempted corner, squeeze, congestion or undue
concentration of positions, or that otherwise are likely to
have a substantial effect on prices in any contract traded
on the Exchange; but does not include any rule not
submitted for prior CFTC approval because such rule is
unrelated to the terms and conditions of any contract
traded on the Exchange.
(b) Relationship with Named Party in Interest
(1) Nature of Relationship. A member of the Board of Directors, a
disciplinary committee or an oversight panel must abstain from
such body's deliberations and voting on any matter involving a
named party in interest where such member:
(i) is a named part in interest;
(ii) is an employer, employee, or fellow employee of a named
party in interest;
(iii) is associated with a named party in interest through a
"broker association" as defined in CFTC Regulation 156.1;
(iv) has any other significant, ongoing business relationship
with a named party in interest, not including relationships
limited to executing futures or option transactions
opposite each other or to clearing futures or option
transactions through the same clearing member; or
(v) has a family relationship with a named party in interest.
(2) Disclosure of Relationship. Prior to the consideration of any
matter involving a named party in interest, each member of the
Board of Directors, a disciplinary committee or an oversight panel
must disclose to the designated staff liaison whether he or she
has one of the relationships listed in section (b)(1) hereof with
a named party in interest.
(3) Procedure for Determination. When it becomes necessary to
determine whether any member of the Board of Directors, a
disciplinary committee or an oversight panel is subject to a
conflicts restriction under section (b)(1) hereof, such Board of
Directors, disciplinary committee or oversight panel shall
determine by majority vote whether a particular member is required
to abstain. Taking into consideration the exigency of the
committee action, such determination should be based upon:
(i) information provided by the member pursuant to section
(b)(2) hereof; and
(ii) any other source of information that is held by and
reasonably available to the Exchange.
(c) Financial Interest in a Significant Action.
(1) Nature of Interest. A member of the Board of Directors, a
disciplinary committee or an oversight panel must abstain from
such body's deliberations and voting on any significant action if
the member knowingly has a direct and substantial financial
interest in the result of the vote based upon either exchange or
non-exchange positions that could reasonably be expected to be
affected by the action.
(2) Disclosure of Interest. Prior to the consideration of any
significant action, each member of the Board of Directors, a
disciplinary committee or an oversight panel must disclose to
designated staff liaison the position information referred to in
section (c)(3) hereof that is known to him or her. This
requirement does not apply to a member who chooses to abstain from
deliberations and voting on the subject significant action.
(3) Procedure for Determination. When it becomes necessary to
determine whether any member of the Board of Directors, a
disciplinary committee or an oversight panel is subject to a
conflicts restriction under section (c)(1) hereof, such Board of
Directors, disciplinary committee or oversight panel shall
determine by majority vote whether a particular member is required
to abstain. Such determination must include a review of:
(i) gross positions in contracts traded at the Exchange in the
member's personal accounts or "controlled accounts", as
defined in CFTC Regulation 1.3(j);
(ii) gross positions in contracts traded at the Exchange in
proprietary accounts, as defined in CFTC Regulation
1.17(b)(3), at the member's affiliated firm;
(iii) gross positions in contracts traded at the Exchange in
accounts in which the member is a principal, as defined in
CFTC Regulation 3.1(a);
(iv) net positions in contracts traded at the Exchange in
"customer" accounts, as defined in CFTC Regulation
1.17(b)(2), at the member's affiliated firm; and
(v) any other types of positions, whether in contracts traded
at the Exchange or elsewhere, held in the member's personal
accounts or the proprietary accounts of the member's
affiliated firm that the Exchange reasonably expects could
be affected by the significant action.
(4) Bases for Determination. Taking into account the exigency of the
significant action, the determination described in section (c)(3)
should be based upon;
(i) the most recent large trader reports and clearing records
available to the Exchange;
(ii) information provided by the member with respect to
positions pursuant to section (c)(2) hereof; and
(iii) any other source of information that is held by and
reasonably available to the Exchange.
(d) Participation in Deliberations.
(1) The Board of Directors, a disciplinary committee or an oversight
panel may permit a member thereof to participate in deliberations
prior to a vote on a significant action for which he or she
otherwise would be required by section (c)(1) to abstain, if such
participation would be consistent with the public interest and the
member recuses himself or herself from voting on such action.
(2) In making a determination as to whether to permit a member to
participate in deliberations on a significant action for which he
or she otherwise would be required to abstain, the Board of
Directors, disciplinary committee or oversight panel shall
consider the following factors:
(i) whether the member's participation in deliberations is
necessary for the deliberating body to achieve a quorum in
the matter; and
(ii) whether the member has unique or special expertise,
knowledge or experience in the matter under consideration.
(3) Prior determination to any pursuant to section (d)(1) hereof, the
Board of Directors, disciplinary committee or oversight panel must
fully consider the position information which is the basis for the
member's direct and substantial financial interest in the result
of a vote on a significant action pursuant to section (c) hereof.
(e) Documentation of Determination. The Board of Directors, a disciplinary
committee and an oversight panel must reflect in their minutes or otherwise
document that the conflicts determination procedures required by this
regulation have been followed. Such records also must include:
(1) the names of all members who attended the meeting in person or who
otherwise were present by electronic means;
(2) the name of any members who voluntarily recused himself or herself
or was required to abstain from deliberations and/or voting on a
matter and the reason for the recusal or abstention, if stated;
and
(3) information on the position information that was reviewed for each
member.
Interpretation of Regulation 188.04
Questions have arisen about the meaning of certain provisions of CBOT Regulation
188.04, the new conflict of interest standard required by CFTC Regulation 1.69.
This interpretation will enable Regulation 188.04 to be applied in a uniform
manner.
1. Regulation 188.04(a)(1), (3) and (4): Not Applicable to Arbitration or
Membership Committees. Neither the Arbitration Committee nor any panel thereof
is a governing board, a disciplinary committee or an oversight panel. When the
Membership Committee reviews membership applications, it is not a governing
board, a disciplinary committee or an oversight panel. However, the Membership
or the Regulatory Compliance Committee is a disciplinary committee when it
conducts proceedings to decide whether to deny a membership application
2. Regulation 188.04(a)(2): Definition of In-Law. An in-law is (1) a mother,
father, sister or brother of a member's current spouse or (2) the current spouse
of (a) a member's brother or sister or (b) a brother or sister of a member's
current spouse.
3. Regulation 188.04(a)(7)(i): Significant Action By the Business Conduct
Committee. As part of its surveillance of expiring contracts, the Business
Conduct Committee (BCC) may decide to review or request information, relay
concern, or remind market participants of their obligations under Exchange
rules. These matters are not "significant actions."
Matters considered by the BCC during its expiration surveillance do not
constitute "significant action" until the Committee begins to consider whether
to recommend that the Board of Directors take emergency action under Rule
180.00.
4. Regulation 188.04(b): Business Conduct Committee Surveillance of Expiring
Contracts. In the Business Conduct Committee's review of expiring contracts, a
market participant would be considered a "named party in interest" if (a) that
market participant were identified to the Committee and (b) the Committee
communicated with or considered whether to communicate with that identified
participant
5. Regulation 188.04(b): CTR Violations by Member Firms. CTR violations by
member firms are not treated as summary offenses. A joint subcommittee (the "CTR
Subcommittee") of the Business Conduct and Floor Governors Committees reviews
reports of violations of rules relating to the submission of CTR data by member
firms. The CTR Subcommittee decides whether to recommend that the Business
Conduct Committee institute disciplinary proceedings (and also makes
recommendations about preliminary penalties) against such firms. The Business
Conduct Committee then reviews these recommendations and decides whether to
authorize the commencement of disciplinary proceedings. The respondent can
submit a settlement offer to or request a hearing before the Business Conduct
Committee.
When a CTR violation is not treated as a summary offense, and the preliminary
penalty is not more than $5,000, a member of the CTR Subcommittee and the
Business Conduct Committee will abstain from deliberations and voting on the
recommendation, issuance or settlement of charges against a member firm if the
committee member is a principal or employee of that member firm. Committee
members are not required to disclose any other relationship under Regulation
188.04(b)(2), and no inquiry need be made under Regulation 188.04(b)(3) into any
other relationship.
6. Regulation 188.04(b)(1): Quotation Changes, Insertions, Deletions. In
considering requests for price changes, insertions, or deletions, Pit Committees
and the Project A Trade Resolution Committee are deemed to be "oversight
panels," but such actions are not "significant actions." Accordingly, these
committees are subject to restrictions relating to named parties in interest
under Regulation 188.04(b)(1), but are not subject to the "significant action"
standards and procedures under Regulation 188.04(c). Under Regulation 188.04(b),
the party requesting the change and the members who executed the trade in
question are the named parties in interest.
7. Regulation 188.04(b)(1)(iv): When Is An Ongoing Business Relationship
"Significant?"
Floor Brokerage. A floor broker has a significant relationship with his/her
customer and the principals of that customer if more than 10% of the contracts
executed by that broker in the preceding three months were executed for orders
placed with the broker by that customer.
A floor broker who executes orders placed with him by Firm A which are then
given up to Firm B does not have a significant relationship with Firm B.
Give-Up Agreements. Clearing Member A and its principals and employees and
executing Member B and its principals and employees do not have a significant
relationship by virtue of a give-up agreement between A and B, unless more than
25% of the volume of contracts executed by Member B are given up to Member A, or
unless 25% of the volume of contracts cleared by Member A are executed by
Member B
Membership Leases. The owner of a membership or membership interest and a
person to whom he or she has delegated any of the privileges of that membership
under Rule 221.00 have a significant ongoing business relationship.
Loans. A member who owes to a party or is owed by a party more than $5,000 has a
significant ongoing business relationship with that party and its principals and
employees.
Guarantees. A member who guarantees a financial obligation to or has a financial
obligation guaranteed by a party has a significant ongoing business relationship
with that party and its principals and employees, unless the outstanding
indebtedness subject to the guarantee is $25,000 or less.
Indemnification Agreements. A member who indemnifies or is indemnified by a
party has a significant ongoing business relationship with that party and its
principals and employees, unless the indemnity agreement limits the liability of
the indemnifying party to $25,000 or less. (08/01/99)
188.05 Board's Interpretive Authority - The Board of Directors, pursuant to
authority granted to it by Article I, Section 2 of the Amended and Restated
Bylaws of the CBOT (the "Bylaws"), may from time to time adopt Interpretations
of the Amended and Restated Certificate of Incorporation of the CBOT (the
"Charter"), the Bylaws, which include the Rules of the CBOT, and Regulations of
the CBOT in a manner that replicates, to the largest extent permissible under
the Delaware General Corporation Law, the comparable provisions of the Special
Charter, Rules and Regulations of the Board of Trade of the City of Chicago,
except as otherwise set forth in the Chapter, Bylaws and Regulations. (10/01/00)
189.01 Limitation of Liability of Index Licensors or Administrators -
A. No Index Licensor or Administrator shall have any liability for any loss,
damages, claim or expense arising from or occasioned by any inaccuracy,
error or delay in, or omission of or from, (i) any index or index
information or (ii) the collection, calculation, compilation, maintenance,
reporting or dissemination of any index or index information, resulting
either from any negligent act or omission by the Exchange, any Related
Entity or any Index Licensor or Administrator or from any act, condition or
cause beyond the reasonable control of the Exchange, any Related Entity or
any Index Licensor or Administrator, including, but not limited to, flood,
extraordinary weather conditions, earthquake or other act of God, fire,
war, insurrection, riot, labor dispute, accident, action of government,
communications or power failure, or equipment of software malfunction.
B. No Index Licensor or Administrator makes any express or implied warranty as
to results that any person or party may obtain from using any index or
index information, for trading or any other purpose. Each Index Licensor
and Administrator makes no express or implied warranties, and disclaims all
warranties of merchantability or fitness for a particular purpose or use,
with respect to any such index or index information.
C. For purposes of this regulation, "Related Entity" includes, but is not
limited to, any subsidiary, affiliate or related partnership or entity of
the Chicago Board of Trade, including without limitation, Ceres Trading
Limited Partnership, MidAmerica Commodity Exchange, Board of Trade Clearing
Corporation, the Clearing Corporation for Options and Securities, Chicago
Board Brokerage, L.L.C., The CBBB Partnership (including its individual
partners) and C-B-T Corporation.
D. For the purpose of this regulation, "Index Licensor or (and) Administrator"
includes, but is not limited to, any person who:
1. licenses to the Exchange the right to use (i) an index that is the
basis for a futures or futures option contract made available for
trading on or through the facilities of the Exchange or a Related
Entity or (ii) any trademark or service mark associated with such an
index;
2. collects, calculates, compiles, reports and/or maintains such an index
or index information relating to such an index;
3. provides price data or evaluations used in the calculation of such an
index including, but not limited to, the entities identified in
Appendix 19 of these Rules and Regulations
4. provides facilities for the dissemination of an index or index
information; and/or
5. is responsible for or participates in any of the activities described
above. (04/01/98)
189.02 Limitation of Liability -
A. Neither the Exchange nor any Related Entity shall have any liability for
any loss, damages, claim or expense arising from or occasioned by any
inaccuracy, error or delay in, or omission of or from, (i) any index or
index information or (ii) the collection, calculation, compilation,
maintenance, reporting or dissemination of any index or index information,
resulting either from any negligent act or omission by the Exchange, any
Related Entity or any
Index Licensor or Administrator or from any act, condition or cause beyond
the reasonable control of the Exchange, any Related Entity or any Index
Licensor or Administrator, including, but not limited to, flood,
extraordinary weather conditions, earthquake or other act of God, fire,
war, insurrection, riot, labor dispute, accident, action of government,
communications or power failure, or equipment or software malfunction.
B. Neither the Exchange nor any Related Entity makes any express or implied
warranty as to results that any person or party may obtain from using any
index or index information for trading or any other purpose. The Exchange
and its Related Entities make no express or implied warranties, and
disclaim all warranties of merchantability or fitness for a particular
purpose or use, with respect to any such index or index information.
C. Nothing in this regulation shall limit the applicability of the Commodity
Exchange Act or the regulations of the Commodity Futures Trading
Commission.
D. For purposes of this regulation, "Related Entity" includes, but is not
limited to, any subsidiary, affiliate or related partnership or entity of
the Chicago Board of Trade, including without limitation, Ceres Trading
Limited Partnership, MidAmerica Commodity Exchange, Board of Trade Clearing
Corporation, the Clearing Corporation for Options and Securities, Chicago
Board Brokerage, L.L.C., The CBBB Partnership (including its individual
partners) and C-B-T Corporation.
E. For the purpose of this regulation, "Index Licensor or (and) Administrator"
includes any person who:
1. licenses to the Exchange the right to use (i) an index that is the
basis for a futures or futures option contract made available for
trading on or through the facilities of the Exchange or a Related
Entity or (ii) any trademark or service mark associated with such an
index;
2. collects, calculates, compiles, reports and/or maintains such an index
or index information relating to such an index;
3. provides price data or evaluations used in the calculation of such an
index including, but not limited to, the entities identified in
Appendix 19 of these Rules and Regulations;
4. provides facilities for the dissemination of an index or index
information; and/or
5. is responsible for or participates in any of the activities described
above. (04/01/98)
Resolution - The following Resolution was adopted by the Board of Directors on
June 24,1987:
WHEREAS, the Board of Trade of the City of Chicago ("Board of Trade") has
consistently followed a policy of trading options contracts on all liquid
futures contracts to the maximum extent permitted by federal law and regulation;
and
WHEREAS, it is the unanimous consensus of this Board of Directors that options
on futures contracts have proven to be a successful product of great benefit to
both the membership and public market participants; and
WHEREAS, the Board of Directors this day approved and recommended for membership
approval an agreement to establish a joint venture with the Chicago Board
Options Exchange which includes commitments regarding future trading on options
on futures contracts;
THEREFORE, BE IT HEREBY RESOLVED: That it is the unanimous consensus of this
Board of Directors and the recommendation of this Board to future Boards of
Directors that the policy of establishing options on liquid futures contracts to
the maximum extent permissible by law be continued when in the best interest of
the membership and the public.
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Chapter 2
Membership
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Ch2 Applicants....................................................
200.00 Applicants for Membership.........................
201.00 Application for Membership........................
201.00A Examination Requirement...........................
201.01 Responsibilities of Applicant for Membership and
His Sponsors.....................................
201.01A Sponsoring Applicants for Membership..............
201.02 Maintenance of Membership Qualifications..........
202.00 Approval for Membership...........................
202.01 Delegation of Authority to Approve Change in
Status Request...................................
202.01A Procedures of Authority to Approve................
202.02 Procedures for Hearings on Preliminary Denials by
the Membership Committee.........................
202.03 Membership Committee's Preliminary Decisions......
203.01 Procuring a Membership or Membership Interest.....
204.00 Membership Obtained by Fraud......................
205.00 Agreement to Observe Rules and Regulations........
205.01 Acquisition of Class A Units of Ceres Trading
Limited Partnership..............................
206.02 Gratuities........................................
207.00 Office Address....................................
207.01 Primary Clearing Member...........................
208.00 Conducting Business Under a Firm Name.............
208.01 Conducting Business Under a Firm Name.............
209.00 Indemnification of Association....................
209.01 Floor Trading Permits.............................
209.02 MidAmerica Floor Access Members' Trading
Privileges.......................................
209.03 Product Sponsor Programs..........................
209.04 MidAmerica Members' and Permit Holders' Trading
Privileges.......................................
210.00 Full Member CBOE "Exercise" Privilege.............
211.00 Associate Memberships.............................
212.00 Reciprocal Trading Privileges with LIFFE..........
213.00 Assessments and Fees..............................
214.00 Obligations and Duties............................
215.00 Associate Members Committee.......................
217.00 Applicants........................................
219.00 Communications From Floor.........................
220.00 Violations........................................
221.00 Delegation........................................
221.01 Delegation by Deceased Member's Estate............
221.02 Floor Access of Delegating Members and Delegates..
221.03 Minimum Delegation Term...........................
221.05 Delegates' Clearing Members.......................
221.07 Voting Rights.....................................
221.08 Requirements for Delegates of Membership Interests
221.09 Delegation of Firm-Owned Memberships and
Membership Interests.............................
221.10 Indemnification of Delegators.....................
221.11 Delegation by Trust...............................
222.00 Multiple Memberships..............................
224.00 Trades of Non-Clearing Permit Holders.............
Ch2 Registration..................................................
230.00 Registration......................................
230.01 Eligible Business Organizations...................
230.02 Registration of Membership for Eligible Business
Organizations....................................
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230.03 Designated Persons................................
230.04 Cooperative Association of Producers..............
230.05 Registration for Trading on the Floor in Cash
Grain............................................
230.06 Eligible Business Organization Status Upon Death
or Withdrawal of Registered Member...............
230.07 Primary Clearing Member Permission for Member
Registration.....................................
230.08 Doing Business in Firm (or Trade) Name............
230.09 Formation of Partnerships or Limited Liability
Companies........................................
230.10 Suspended or Insolvent Members....................
230.11 Discipline of Partners or Members of Limited
Liability Companies..............................
230.12 Dissolution of Partnership or Limited Liability
Company..........................................
230.13 Relations Controlling Policy......................
230.14 Delegation of Approval Authority..................
230.15 Financial Requirements............................
230.16 Designated Liaison................................
230.17 Changes in Organization...........................
231.00 Ownership and Registration of Associate
Memberships......................................
Ch2 Assessments and Fees..........................................
240.00 Assessments.......................................
241.00 Members in Military Service.......................
241.01 Dues of Members in Military Service...............
242.00 Neglect to Pay Assessment.........................
243.00 Transfer Fees.....................................
243.01 Sale and Transfer of Membership Privileges........
Ch2 Purchase and Sale or Transfer of Membership or Membership
Interest.........................................................
249.01 Purchase and Sale or Transfer of Membership or
Membership Interest..............................
250.01 Sale and Transfer of Membership Privileges........
250.02 Memberships Held Under Regulation 249.01(b).......
250.03 Power-of-Attorney.................................
251.00 Membership Transfer...............................
251.01 Member Under Investigation........................
252.00 Proceeds of Membership -..........................
252.00A Claims Filed by Corporations......................
252.00B Interpretation of Rule 252(e).....................
253.00 Filing Claims.....................................
253.01 Pending Arbitration...............................
255.00 Deceased or Incompetent Member....................
256.00 Expelled Member...................................
Ch2 Insolvency....................................................
270.00 Insolvency
270.01 Restrictions on Operations........................
270.02 Procedures for Member Responsibility Actions......
270.03 Finality of Disciplinary Decisions and Member
Responsibility Actions...........................
271.00 Announcement of Suspension........................
272.00 Insolvent Member..................................
272.01 Bankruptcy of a Member or Non-Member..............
272.02 Deliveries in Bankruptcy Situation................
273.00 Investigation.....................................
273.01 Insolvency........................................
274.00 Reinstatement.....................................
275.00 Suspended or Expelled Member Deprived of
Privileges.......................................
276.00 Suspended Member-Time for Settlement..............
277.00 Discipline During Suspension......................
278.00 Suspension for Default............................
278.01 Arbitration of Default............................
285.01 Financial Questionnaire...........................
285.02 Audits............................................
[Download Table]
285.03 Notification of Capital Reductions................
285.04 Restrictions on Operations........................
285.05 Financial Requirements............................
285.07 Member Joint Accounts.............................
285.08 Financial Arrangements............................
285.09 Trading Associations..............................
286.00 Trades of Non-Clearing Members....................
287.00 Advertising.......................................
Ch2 Membership Interests.............................................
290.00 Market Categories.................................
290.01 Agricultural and Associated Market (AAM)..........
290.02 Government Instruments Market (GIM)...............
290.03 Index, Debt and Energy Market (IDEM)..............
290.04 Commodity Options Market (COM)....................
291.00 GIM Membership Interest...........................
292.00 IDEM Membership Interest..........................
293.00 COM Membership Interests..........................
293.01 COM Membership Rights.............................
293.02 AM and COM Membership Rights......................
293.03 AM and COM Membership Rights......................
293.04 AM and COM Membership Rights......................
293.05 COM Membership Rights.............................
293.06 COM Membership Rights.............................
293.07 AM and COM Membership Rights......................
293.08 AM and COM Membership Rights......................
293.09 AM and COM Membership Rights......................
293.10 COM Membership Rights.............................
293.12 IDEM Membership Rights............................
293.14 AM and COM Membership Rights......................
293.15 COM Membership Rights.............................
293.16 IDEM Membership Rights............................
293.17 COM Membership Rights.............................
294.00 Membership Interest Participations................
294.01 Transfer of Membership Interest Participations....
294.02 Registration of Membership Interests..............
294.03 Dues and Assessments on Membership Interest
Participations...................................
294.04 Accumulation of Membership and Membership
Interest Participations by the Board.............
294.05 Time Limit for Accumulating AM Participations.....
294.06 Claims Procedures Regarding Membership Interest
Fractional Participations........................
296.00 Elimination of GIM Membership Interests...........
296.01 Transfer of Associate Membership Participations...
296.02 Registration of New Associate Memberships.........
296.03 Additional Associate Membership Participations or
GIM Membership Interests.........................
296.04 Waiver of Transfer and Registration Fees..........
296.05 Dues and Assessments..............................
296.06 Claims Procedures Regarding Associate Membership
Participations...................................
================================================================================
Chapter 2
Membership
================================================================================
Ch2 Applicants
200.00 Applicants for Membership - Any individual, other than an employee of
the Association, at least twenty-one years of age, of good character,
reputation, financial responsibility and credit who satisfies the Membership
Committee that such individual is suitable to assume the responsibility and
privileges of membership shall be eligible. 100 (08/01/94)
200.01 GIMs, IDEMs and COMs as Members. The holders of GIM, IDEM and COM
membership interests shall be deemed to be, "Members" of the Board of Trade of
the City of Chicago, Inc. for purposes of Delaware General Corporation Lan, as
amended from time to time.
201.00 Application for Membership - Each application for membership shall be
in writing and filed with the Exchange together with the names of two member
sponsors. All applicants for membership shall be investigated as to the
representations contained in the application. Upon receipt of the application
for membership, the Secretary shall, within fifteen days thereafter, send to
members of the Association the names of the applicant and of the sponsors, and
shall post the same information on the bulletin board for a period of at least
ten days after such notification to the Membership.
The foregoing provisions do not apply to those applicants seeking to become Full
Members or Full Member Delegates of the Exchange solely for the purpose of
becoming regular members of the Chicago Board Options Exchange (`CBOE") pursuant
to Rule 210.00 and Article FIFTH(b) of the CBOE's Certificate of Incorporation.
Such applicants need only submit an application in writing in the form and
manner prescribed by the Exchange. 101 (11/01/99)
201.00A Examination Requirement - Individuals applying for membership, who
have not evidenced a broad experience in the commodity industry, will be
required to pass a general futures examination covering the basics of the
commodity industry before their membership application can be approved by the
Membership Committee. The foregoing provision does not apply to those applicants
seeking to become Full Members or Full Member Delegates of the Exchange solely
for the purpose of becoming regular members of the Chicago Board Options
Exchange ("CBOE") pursuant to Rule 210.00 and Article FIFTH(b) of the CBOE's
Certificate of the Incorporation. 47R (11/01/99)
201.01 Responsibilities of Applicant for Membership and His Sponsors - Any
undue delay by an applicant or his sponsors in the submission of documents
required for processing of the membership application or any undue delay by the
applicant or his sponsors in appearing may be deemed as a withdrawal of the
membership application. 1807A (08/01/94)
201.01A Sponsoring Applicants for Membership - When the Exchange considers the
qualifications of an applicant for membership in the Chicago Board of Trade, it
relies to a large extent upon the statements of members who are sponsoring the
applicant.
Sponsorship, therefore, entails considerable responsibility; and the Exchange
feels that such responsibility is not met when a member recommends for
membership an individual whom the member sponsor does not know to be fully
qualified. Such sponsorship is of no assistance whatever to the Exchange and
only results in the rejection of the sponsorship-often to the embarrassment of
both the applicant and the sponsor.
The Exchange requires that an applicant have two sponsors.
- For applicants who will not have a primary clearing member ("PCM") firm,
each of their two member sponsors must be either: (1) a registered member,
partner or officer of a CBOT(R) member firm; or (2) a member who has been
acquainted with the applicant for a period of at least ninety days.
- For applicants who will have a PCM, at least one member sponsor must be a
registered member, partner or officer of the applicant's PCM. The other
member sponsor may be a registered member, partner or officer of the
applicant's PCM firm or a member who has been acquainted with the applicant
for a period of at least ninety days.
Ch2 Applicants
--------------
In every case it is imperative that a sponsor make a thorough investigation of
the applicant and be fully informed regarding the applicant's character,
integrity, financial standing and business history.
The foregoing provisions do not apply to those applicants seeking to become Full
Members or Full Member Delegates of the Exchange solely for the purpose of
becoming regular members of the Chicago Board Options Exchange ("CBOE") pursuant
to Rule 210.00 and Article FIFTH(b) of the CBOE's Certificate of Incorporation.
21R (11/01/99)
201.02 Maintenance of Membership Qualifications
1. Each member and member firm immediately shall notify the Association, in
writing, upon the occurrence of any of the following events:
- Such member's suspension or expulsion from any other contract market or
self-regulatory organization;
- Such member's plea of guilty to or conviction of any felony.
Failure to so notify the Association within ten days shall be an act
detrimental to the Association. For the purpose of this regulation, "felony"
shall mean any criminal sanction that is punishable by imprisonment of more
than a year or a fine in excess of $10,000.
Upon the Association's receipt of notification, by whatever means, of the
occurrence of any of the above-referenced events, the matter shall be
referred to the Membership Committee, which immediately shall review the
matter to determine if there is sufficient basis to recommend that
membership status be reconsidered. The Membership Committee shall advise the
Chairman of the Association of its determinations in this regard.
2. The Chairman of the Association, upon the advice of the Membership
Committee, is authorized to take summary action pursuant to this regulation,
when immediate action is necessary to protect the best interests of the
marketplace, without affording prior opportunity for hearing. The following
procedures shall apply to such actions:
(a) The respondent shall, whenever practicable, be served with a notice
before the action is taken. If prior notice is not practicable, the
respondent shall be served with a notice at the earliest possible
opportunity. The notice shall:
(1) State the action,
(2) Briefly state the reasons for the action, and
(3) State the effective time and date and the duration of the action;
(b) The respondent shall have the right to be represented by legal counsel
or any other representative of his choosing in all proceedings
subsequent to any summary action taken;
(c) The respondent shall be given an opportunity for a subsequent hearing,
within five business days, before the Membership Committee. The
hearing shall be conducted in accordance with the following
requirements:
(1) The hearing shall be promptly held before disinterested members
of the hearing body after reasonable notice to the respondent. No
member of the hearing body may serve on that body in a particular
matter if he or any person or firm with which he is affiliated
has a financial, personal or other direct interest in the matter
under consideration.
(2) Formal rules of evidence need not apply, but the hearing shall
not be so informal as to be unfair;
(3) The respondent shall have the right to invoke Rule 548.00, if
applicable;
(4) The Member Services Department shall be a party to the hearing
and shall present its case on those matters which are the subject
of the hearing;
(5) The respondent shall be entitled to appear personally at the
hearing and to be represented by counsel;
(6) The respondent shall be entitled to cross-examine any person(s)
appearing as
Ch2 Applicants
--------------
witness(es);
(d) Within five business days following the conclusion of the hearing, the
Membership Committee shall render a written decision based upon the
weight of the evidence contained in the record of the proceeding and
shall provide a copy to the respondent. The decision shall include:
(1) A description of the summary action taken;
(2) The reasons for the summary action;
(3) A brief summary of the evidence produced at the hearing;
(4) Findings and conclusions;
(5) A determination that the summary action should be affirmed,
modified, or reversed; and
(6) A declaration of any action to be taken pursuant to the
determination specified in (5) above and the effective date and
duration of such action.
3. After the hearing conducted pursuant to Section 2(c) above is held before
the Membership Committee, the following additional provisions shall apply.
The Regulatory Compliance Committee, pursuant to the provisions of Rule
540.00 and Regulation 540.05, shall consider the Membership Committee's
findings and recommendations, as well as the record developed before the
Membership Committee, at the next regularly scheduled meeting of the
Regulatory Compliance Committee or at a meeting specially called by the
Chairman as the Chairman may direct. The member under review shall have the
opportunity to appear before and address the Reguatory Compliance Committee
solely with regard to the record made before the Membership Committee; the
Regulatory Compliance Committee shall not be required to entertain any new
evidence absent a showing that such evidence could not reasonably have been
presented previously to the Membership Committee. Upon full consideration of
all the evidence before it, the Regulatory Compliance Committee may confirm
the member's good standing status, restrict the member's membership status,
deny the member's floor access, issue fines, or recommend to the Board of
Directors that the member should be expelled or prohibited from association
with any member or member firm.
4. The Regulatory Compliance Committee shall vote by secret ballot to take any
action pursuant to this regulation. If two-thirds of the members present and
voting cast votes in favor of such action, the action shall be adopted.
(12/01/97)
202.00 Approval for Membership - If two-thirds of the Membership Committee
present and voting cast affirmative votes, the applicant shall be approved. The
power to deny such applications is expressly reserved to the Regulatory
Compliance Committee. 103 (08/01/94)
202.01 Delegation of Authority to Approve Change in Status Request - The
Chairman of the Membership Committee or a member of the Membership
Committee who has been designated by the Membership Committee
Chairman, or upon delegation by the Chairman, the Member Services and
Member Firm Staff Service Department, will have the power to approve
the request of a Full or Associate Member, a Membership Interest
Holder or a Full Member of the MidAmerica Commodity Exchange to obtain
additional Full or Associate Memberships, Membership Interests, or to
change his or her delegate status. The power to deny such a request is
expressly reserved to the Regulatory Compliance Committee.
For the purpose of this regulation, the Chairman may not delegate approval
authority to the Member Services and Member Firm Staff Services Department when
the following factors are present:
1. The applicant has answered affirmatively to any question in the
"Disciplinary Action" section of the application;
2. The applicant has indicated on the application that he or she is
indebted to any member or member firm;
206
Ch2 Applicants
--------------
3. The applicant has indicated that he or she has a negative net worth;
or
4. The applicant has trading privileges on the MidAmerica Commodity
Exchange only.
The foregoing provisions shall not apply to a Full Member or Full Member
Delegate of the Exchange who was initially approved for membership pursuant to
Regulation 202.01A, unless such applicant intends to become a Full Member or
Full Delegate solely for the purpose of becoming a regular member of the Chicago
Board Options Exchange ("CBOE") pursuant to Rule 210.00 and Article FIFTH(b) of
the CBOE's Certificate of Incorporation. (11/01/99)
202.01A Delegation of Authority to Approve "CBOE Exerciser Only" Applicants-
The Chairman or a Vice Chairman of the Membership Committee, or another member
of the Committee if designated by the Chairman, will have the power to approve
the application of an individual seeking to become a Full Member or Full Member
Delegate of the Exchange solely for the purpose of becoming a regular member of
the Chicago Board Options Exchange ("CBOE") pursuant to Rule 210.00 and Article
FIFTH(b) of the CBOE's Certificate of Incorporation. (11/01/99)
202.02 Procedures for Hearings on Preliminary Denials by the Membership
Committee - In connection with all hearings conducted with respect to
preliminary denials of applications for membership or any other denial by the
Membership Committee, the following procedures shall be followed:
(a) The respondent shall be entitled in advance of the hearing to examine all
books, documents, or other tangible evidence in the possession or under the
control of the Association upon which the Member Services and Member Firm
Staff Services Department will rely in presenting the issue(s) contained in
the Preliminary Denial Letter or which are relevant to that (those)
issue(s). Respondent shall make its request to examine any materials by
submitting it in writing to the Member Services and Member Firm Staff
Services Department as soon as practicable. At least ten (10) business days
in advance of the hearing, the respondent shall submit to the hearing
officer, with a copy to the Member Services and Member Firm Staff Services
Department, copies of all documents which the respondent intends to rely
upon in presenting his or her case, as well as the names of any witnesses
the respondent intends to call.
(b) The Member Services and Member Firm Staff Services Department shall be
entitled in advance of the hearing to examine all books, documents, or
other tangible evidence in the possession or under the control of the
respondent which will be relied upon by the respondent in presenting the
issue(s) contained in the Preliminary Denial Letter or which are relevant
to those issues. The Member Services and Member Firm Staff Services
Department shall make its request to examine any materials by submitting it
in writing to the respondent as soon as practicable. At least ten (10)
business days in advance of the hearing, the Member Services and Member
Firm Staff Services Department shall submit to the hearing officer, with a
copy to respondent, copies of all documents which the Member Services and
Member Firm Staff Services Department intends to rely upon in presenting
its case, as well as the names of any witnesses the Department intends to
call;
(c) Any dispute over a request to examine any book, document. or other tangible
evidence in the possession or under the control of either party shall be
submitted to the Chairman of the Committee for resolution only after the
parties have made all reasonable attempts to resolve the dispute among
themselves;
(d) If objected to or upon its own motion, the hearing panel may refuse to
consider any book, record, document or other tangible evidence which was
not made available to the opponent of the evidence or was not disclosed in
accordance with this paragraph. The panel may also exclude the testimony of
any witness whose name was not submitted to the opponent of the witness as
provided above. The hearing panel may consider such evidence or testimony
upon a clear showing that such evidence was not ascertainable by due
diligence at least ten (10) business days in advance of the hearing and
that there was insufficient time prior to the hearing to bring such
evidence to the attention of the opposing party;
(e) The hearing shall be promptly held before disinterested member of the
Membership Committee or
Ch2 Applicants
--------------
any duly appointed Subcommittee thereof after reasonable notice to the
parties. No member of the Membership Committee may serve on a hearing panel
in a particular matter if he or she or any person or firm with which he or
she is affiliated has financial, personal or other direct interest in the
matter under consideration. After service of the preliminary denial letter,
both parties to the hearing are prohibited from making any ex parte
contacts with any member of the Membership Committee. For the purpose of
this paragraph, an "ex parte contact" shall mean any communication, either
written or oral, which relates directly or indirectly to the issue to be
heard and which is made to a member of the Membership Committee who will be
a member of the panel which shall decide the issue.
(f) Formal rules of evidence need not apply, but the hearing shall not be so
informal as to be unfair;
(g) The respondent shall have the right to invoke Rule 548.00, if applicable;
(h) The Member Services and Member Firm Staff Services Department shall be a
party to the hearing and shall present its case on those issues which are
the subject of the hearing;
(i) The respondent shall be entitled to appear personally at the hearing and to
be represented by counsel;
(j) The parties shall be entitled to cross-examine any person(s) appearing as
witness(es);
(k) The parties shall be entitled to call witnesses and to present such
evidence as may be relevant to he issue(s) presented;
(l) Pursuant to Rule 545.00, all persons within the jurisdiction of the
Association who are called as witnesses shall be obliged to appear at the
hearing and/or to produce evidence;
(m) Substantially verbatim record of the hearing, capable of being accurately
transcribed, shall be made and shall become part of the record of the
proceeding. (07/01/97)
202.03 Membership Committee's Preliminary Decisions - All preliminary
decisions rendered by the Membership Committee shall be in writing and be based
upon the weight of the evidence contained in the record of the proceeding. A
copy of the decision shall be provided to the respondent and shall include:
(a) The issue(s) presented to the Committee;
(b) The response submitted by the applicant or member, if any, or a summary of
the answer;
(c) A brief summary of the evidence produced at the hearing;
(d) A statement of findings and conclusions with respect to the issue(s)
presented;
(e) A declaration containing the Committee's preliminary decision;
(f) All such decisions shall be rendered within thirty business days after the
conclusion of the hearing, unless, by virtue of the complexity of the issue
or other special circumstances, additional time is required;
(g) The Committee shall give respondent reasonable notice of the date on which
its recommendation, based on its preliminary decision, will be forwarded to
the Regulatory Compliance Committee for its consideration. (07/01/97)
203.01 Procuring a Membership or Membership Interest - An individual who
wishes to procure a full or associate membership or membership interest may do
so either prior or subsequent to being approved for a particular membership
status. A person who has acquired a membership or membership interest prior to
being approved for a particular membership status as provided in Regulation
249.01 shall become a member or membership interest holder following such
approval upon signing the appropriate register of the Association. A person
approved for a particular membership status prior to acquiring a membership or
membership interest shall become a member or membership interest holder if
within sixty (60) days after he has been notified of such approval, or within
such extension of said period as may be granted by the Exchange, he shall
procure a membership or membership interest and sign the appropriate register of
the Association; otherwise his approval for a particular membership status shall
be deemed vacated. (11/01/94)
Ch2 Applicants
--------------
204.00 Membership Obtained by Fraud - A membership obtained by fraudulent
representations or concealment shall be disposed of by the Board. 106 (08/01/94)
205.00 Agreement to Observe Rules and Regulations -Applicants for membership
shall be required to sign a written agreement to observe and be bound by the
Charter, Rules, and Regulations of the Association, and all amendments
subsequently made thereto. 107 (08/01/94)
205.01 Acquisition of Class A Units of Ceres Trading Limited Partnership -Any
person or entity who acquires ownership of a membership or a membership interest
after July 17, 1992 shall, simultaneously with the acquisition of ownership of
such membership or membership interest, purchase a Class A unit of limited
partnership interest of Ceres Trading Limited Partnership, a Delaware limited
partnership, of the appropriate sub-class (as set forth in Section 3.8 of the
Agreement of Limited Partnership governing Ceres Trading Limited Partnership)
from the person or entity from which he, she or it is acquiring ownership of the
membership or membership interest (the "Transferor"), or if such Transferor does
not own a unit of limited partnership interest of Ceres Trading Limited
Partnership, from the General Partner of Ceres Trading Limited Partnership. The
proceeds payable to a Transferor who does not own a unit of limited partnership
interest of Ceres Trading Limited Partnership shall be equal to (a) the
aggregate proceeds paid by the Purchaser for the membership or membership
interest plus a unit of limited partnership interest reduced by (b) the amount
paid to the General Partner for such unit of limited partnership interest under
Section 10.3(b) of the Agreement of Limited Partnership. The acquisition of
ownership of a membership or membership interest shall constitute a request of
the acquirer that the books and records of Ceres Trading Limited Partnership
reflect the acquirer's admission as a substituted limited partner thereof, and
shall constitute the acquirer's agreement to be bound by the Agreement of
Limited Partnership. (08/01/94)
206.02 Gratuities - No member of the Association shall employ any employee of
the Association or of the Clearing House, for any service outside the hours of
regular employment by the Association or such corporation, without having first
obtained the approval therefor of the President or of said Clearing House, as
the case may be, and registering therewith the name of said employee, the nature
of the services rendered, and the amount of said compensation.
No member shall give any compensation or gratuity to an employee of the Clearing
House unless the giving of such compensation or gratuity be first submitted in
writing to the Clearing House and approved.
No member, member firm or employee thereof shall directly or indirectly give or
offer to give any compensation or gratuity in excess of $250 (or having a
reasonable aggregate value in excess of $250) per person per year to any
employee of the Association. Employees of the Association are forbidden to
accept any compensation or gratuity in excess of $250 from any member, member
firm or employee thereof for any service rendered or to be rendered unless the
giving of such compensation or gratuity be first submitted in writing to the
President and approved. A gift of any kind is considered a gratuity.
No member, member firm or employee thereof, shall give or offer to give
gratuities to any other member, member firm or employee thereof in an amount
exceeding that which may be considered reasonable and proper under normal
business practices as determined by the Business Conduct Committee. The giving
or offering to give gratuities to a member, member firm or employee thereof is
not to become a vehicle to obtain Exchange related business in a non-competitive
fashion. Failure to comply with this Regulation may be deemed an act detrimental
to the interest or welfare of the Association. (08/01/94)
207.00 Office Address - Every member shall register with the Secretary an
address and subsequent changes thereof where notices may be served. 128
(08/01/94)
207.01 Primary Clearing Member - Every member shall register the name and
clearing house number of his or her Primary and Secondary Clearing Member with
the Member Services and Member Firm Staff Services Department. If applicable,
the registration shall include the name and clearing house number of any
division of the clearing member firm. In addition, every member shall notify the
Member Services and Member Firm Staff Services Department of any changes in his
or her Primary and/or Secondary Clearing Member, including the name and clearing
house number of the division thereof if applicable. (07/01/97)
Ch2 Applicants
--------------
208.00 Conducting Business Under a Firm Name - An individual may conduct his
business under a firm name provided it is clearly stated on all letterheads,
statements, and other business forms that the individual is the sole owner of
the firm. 132 (08/01/94)
208.01 Conducting Business Under a Firm Name - An individual conducting
business under a firm name as a sole proprietor pursuant to Rule 208.00 shall
submit a statement to the Department of Member Services of this Association
giving the name, address, and nature of the business conducted. The member shall
report immediately any change in the required information. 1803 (08/01/94)
209.00 Indemnification of Association - In any legal proceeding brought
against the Association and alleging its failure to prevent, detect or require
certain conduct of a member or registered eligible business organization, which
conduct or inaction is alleged to be in violation of any law or of the Rules and
Regulations of the Association, such member or registered eligible business
organization shall indemnify and hold the Association harmless for the full
amount of any expense (including attorney's fees), judgment or settlement paid
by it in respect to such proceeding. 134 (04/01/98)
209.01 Floor Trading Permits - The Board of Directors may at any time in its
discretion establish a limited number of floor trading permits as needed to
promote orderly and liquid markets in new and existing contracts. Such permits
shall convey to qualified individuals a temporary right to trade as principal
and/or broker for others in designated contracts on the floor of the Exchange.
Such permits shall not be convertible into memberships or membership interests
or carry any other rights or incidents not expressly specified in creating such
permits. (08/01/94)
209.02 MidAmerica Floor Access Members' Trading Privileges - Floor Access
Members of the MidAmerica Commodity Exchange shall be eligible to trade as
principal and as broker for others in Institutional Index futures contracts on
the Exchange Floor. Such persons may communicate from the Exchange Floor with
non-member customers in the same manner as members may do so, but only with
respect to Institutional Index futures contracts.
In the exercise of these privileges, such persons shall be subject to the
jurisdiction of the Association and to all duties and obligations imposed upon
members, registered firms or other approved persons under the Rules and
Regulations; provided, however, that the Board may exempt such persons from any
such duty or obligation which, in its sole judgement, is incompatible or in
conflict with, or is unrelated to, the activities performed by them. (08/01/94)
209.03 Product Sponsor Programs - The Board of Directors may at any time in
its discretion establish product sponsor programs as needed to promote orderly
and liquid markets in new contracts. A product sponsor program shall convey to
qualified members and member firms such inducements as the Board may grant in
return for a product sponsor's participation in a particular contract market. A
product sponsor program shall not create any interests or carry any other rights
or incidents thereto which are not expressly specified in creating the program.
(08/01/94)
209.04 MidAmerica Members' and Permit Holders' Trading Privileges - Floor
Access Members and Rough Rice Permit holders of the MidAmerica Commodity
Exchange shall be eligible to trade as principal and as broker for others in
Rough Rice futures and futures options contracts on the Exchange Floor. Such
persons may communicate from the Exchange Floor with non-member customers in the
same manner as members may do so, but only with respect to Rough Rice contracts.
In the exercise of these privileges, such persons shall be subject to the
jurisdiction of the Association and to all duties and obligations imposed upon
members, registered firms or other approved persons under the Rules and
Regulations; provided, however, that the Association may exempt such persons
from any such duty or obligation which, in its sole judgement, is incompatible
or in conflict with, or is unrelated to, the activities performed by them.
(11/01/94)
210.00 Full Member CBOE "Exercise" Privilege - In accordance with the
Agreement entered into on September 1, 1992 (the "Agreement") between the
Exchange and the Chicago Board Options Exchange ("CBOE"), Eligible CBOT Full
Members who maintain all appurtenant trading rights and privileges of a full
membership, including any new trading rights or privileges granted, assigned or
issued to a CBOT full membership to the extent such right or privilege is deemed
under the provisions of such Agreement to be appurtenant to a CBOT Full
Membership, are eligible to become regular
Ch2 Applicants
--------------
members of the CBOE pursuant to Article Fifth(b) of CBOE's Certificate of
Incorporation. A CBOT Full Member may delegate all of his trading rights and
privileges of full membership to an individual who will then be eligible to
become a regular CBOE member pursuant to Article Fifth(b) of CBOE's Certificate
of Incorporation; provided, however, if a CBOT Full Member delegates some, but
not all, of the appurtenant trading rights and privileges of full membership,
then neither the member nor the delegate will be eligible to be a CBOE regular
member pursuant to Article Fifth(b). No person who is not either an Eligible
CBOT Full Member or an Eligible CBOT Full Member Delegate (See Rule
221.00(g)(ii)) shall knowingly apply to become, or knowingly remain, a regular
member of CBOE pursuant to Article Fifth(b) of CBOE's Certificate of
Incorporation.
For purposes of the Agreement entered into on September 1, 1992 between the
Exchange and the CBOE, an Eligible CBOT Full Member means an individual who at
the time is the holder of one of the One Thousand Four Hundred Two (1,402) CBOT
full memberships ("CBOT Full Memberships") existing on the date of the Agreement
and who is in possession of all trading rights and privileges appurtenant to
such CBOT Full Membership. In the event a CBOT Full Membership is registered
for a partnership, corporation or other entity, only the individual who is the
holder of such CBOT Full Membership and who is in possession of all trading
rights and privileges appurtenant to such CBOT Full Membership shall be deemed
to be an "Eligible CBOT Full Member." "Trading rights and privileges
appurtenant to such CBOT Full Membership" means (1) the rights and privileges of
a CBOT Full Membership which entitle a holder or delegate to trade as principal
and broker for others in all contracts traded on the CBOT, whether by open
outcry, by electronic means, or otherwise during any segment of a trading day
when trading is authorized; and (2) every trading right or privilege granted,
assigned or issued by CBOT after the effective date of this Agreement to holders
of CBOT Full Membership, as a class, but excluding any right or privilege which
is the subject of an option granted, assigned or issued by CBOT to a CBOT Full
Member and which is not exercised by such CBOT Full Member. (08/01/94)
211.00 Associate Memberships - A personal privilege designated as an
Associate Membership is hereby created to promote orderly and liquid markets and
to provide for the future growth of the Association through increased liquidity
and participation in the trading on the Floor of the Exchange. Associate Members
shall be allowed to trade, as hereinafter provided, all existing and prospective
future contracts and options contracts which shall be listed from time to time
in the Government Instruments Market; Index, Debt and Energy Market; and
Commodity Options Market categories pursuant to Rule 290.00. An Associate Member
shall have the right, subject to the Rules and Regulations of the Association,
to trade as principal and as broker for others and to solicit orders from others
on the Floor of the Exchange, in all eligible contracts and options as
designated above. Associate Memberships shall not carry with them the attributes
of full memberships of the Association under the Fifth Article of the
Certificate of Incorporation of the Chicago Board Options Exchange. In the event
of liquidation of the Association, the Associate Member's share of the proceeds
from dissolution shall be 1/6th of a full member's share. (08/01/94)
212.00 Reciprocal Trading Privileges with LIFFE -
(a) (1) Subject to the provisions of the Link Agreement with LIFFE and the
LIFFE rules, one who owns or is registered for an undelegated Full or Associate
Membership and is authorized by the Association for these purposes may (A) enter
the trading floor of the LIFFE market, (B) trade contracts in the terms of
Designated CBOT Contracts on the trading floor of the LIFFE market and (C)
communicate from the trading floor of the LIFFE market to persons not on that
floor, with respect to Designated CBOT Contracts.
(2) A member who trades contracts in the terms of Designated CBOT Contracts
on the trading floor of the LIFFE market shall be eligible for member
transaction fees assessed by the Exchange on positions transferred to the
Clearing House.
(3) During any period when the rights granted by this Rule are being
exercised at LIFFE, the membership may not be used by anyone to trade on the
floor of the Exchange.
(b) (1) Subject to the provisions of the Link Agreement with LIFFE and the
rules and regulations of the Association, a member of LIFFE or a trader
registered with a member of LIFFE (but not a leaseholder) who is authorized by
LIFFE for these purposes, may (A) enter the floor of the Exchange,
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(B) trade contracts in the terms of Designated LIFFE Contracts on the floor of
the Exchange and (C) communicate from the Floor of the Exchange with persons not
on the Floor of the Exchange, with respect to Designated LIFFE Contracts.
(2) The primary clearing member of such a person, referred to in (b)(1)
above, shall guarantee his obligations under Rules 252.00 and 253.00.
(3) Upon revocation of such a person's primary clearing authorization, the
Secretary shall give written notice thereof to all members and delegates.
Thereafter, all members and delegates who may have claims against him may file
claims in the same manner as provided in Rules 252.00 and 253.00 of the
Association. The primary clearing member shall be responsible for the payment
of those claims allowed by the Board and not satisfied promptly by such a person
whose primary clearing authorization has been revoked. (06/01/97)
213.00 Assessments and Fees - Associate Members shall be responsible for all
operating assessments and exchange service fees as if a full member of the
Association. 863 (08/01/94)
214.00 Obligations and Duties - Associate Members shall be subject to all
Rules and Regulations of the Association including all specific duties and
obligations imposed on them by the Rules and Regulations, as well as those
duties and obligations imposed upon members, registered firms or other approved
persons under the Rules and Regulations; provided, however, the Board may exempt
Associate Members from any such duty or obligation which is incompatible with or
in conflict with or unrelated to, the activities performed by them. 864
(08/01/94)
215.00 Associate Members Committee - There will be an elected Committee of
Associate Members whose purpose will be to represent the rights and privileges
of the Associate Membership and to promote those rights and privileges to the
mutual benefit of the general membership.
The Committee shall consist of fifteen (15) Associate Members elected on the
Annual Election date by the Associate Membership. At the first election
following the adoption of this Rule, eight members will be elected for a two-
year term and seven members will be elected for a one-year term. Thereafter,
seven members will begin a new two-year term each even-numbered year and eight
members will begin a new two-year term each odd-numbered year. The Committee
will select its Chairman and Vice Chairman. The Chairman of this Committee will
be the liaison to the Chairman of the Board of Directors. 865 (08/01/94)
217.00 Applicants - Applicants for Associate Memberships shall be approved in
the same manner and under the same conditions and procedures as are applicants
for full membership. 867 (08/01/94)
219.00 Communications From Floor - Associate Members may communicate from the
Floor of the Exchange during business hours with non-member customers in the
same manner as members, but only with respect to eligible futures contracts or
options as defined in Rule 211.00. 869 (08/01/94)
220.00 Violations - In addition to being bound to comply with the Rules and
Regulations of the Association to which all members are bound, unless exempted
by the Board under Rule 214.00, it shall be an offense against the Association
for an Associate Member to:
(1) Execute a trade in any futures contracts or options that are not eligible as
defined in Rule 211.00;
(2) Place an order on the Floor of the Exchange for the execution of any futures
contracts or options that are not eligible as defined in Rule 211.00; or
(3) Engage in words or deeds which represent, or are reasonably calculated to
represent, that he is a holder of a full membership. 870 (08/01/94)
221.00 Delegation - An individual member may delegate the rights and
privileges of Full and/or Associate Memberships to an individual (a "delegate")
upon the following terms and conditions:
(a) The delegate shall first be approved by the Exchange under the standards
of Rule 200.00 and shall sign a written agreement to observe and be
bound by the Charter, Rules, and Regulations of the Association, and all
amendments subsequently made thereto: Provided, however, an approved
delegate having no outstanding disciplinary penalties and no
restrictions pursuant to Rule 511.00 or 512.00 shall remain approved to
enter a new delegation agreement within six (6) months
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following the termination of the previous delegation agreement. The
Exchange may, in its discretion, grant extensions of this six (6) month
approval period.
(b) The delegation agreement, any amendment thereto, and any termination,
revocation, or renewal thereof, shall be in writing in such form as the
Exchange may prescribe, and a copy thereof shall be filed by the member
with the Exchange as a precondition to its effectiveness: Provided,
however, the delegation agreement shall be null and void automatically
upon the happening of any of the following events:
(1) Loss of any of the qualifications for entering a delegation
agreement, such as sale of the membership of the member or
expulsion of the member or the delegate; or
(2) The suspension of the member by the Association within three months
of the date of the filing of the delegation agreement by the member
with the Exchange;
(c) (1) The member shall remain liable (for an amount up to, but not in
excess of, the value of the seat the member has leased) for the debts,
acts and delinquencies of the delegate arising from the delegate's
exercise of rights and privileges of membership. The membership so
delegated may be sold to satisfy any such liability in accordance with
the Rules and Regulations of the Association. Delegation shall not
relieve the member of any of his obligations or liabilities which he
might otherwise have by the virtue of being a member of the Association
to other members of the Association;
(2) Upon the termination or expiration of the delegation agreement, the
Secretary shall give written notice thereof to all members and
delegates. Thereafter, all members and delegates who may have claims
against the delegate may file claims in the same manner as provided in
Rule 252.00 of the Association. The member entering into a delegation
agreement shall be responsible for the payment of those claims allowed
by the Board and not satisfied promptly by the delegate, but only to the
extent of the value of the membership so delegated;
(d) A delegate shall not be entitled to register under Rule 230.00 for an
eligible business organization;
(e) The Finance Committee, in its discretion, may impose fees, charges and
assessments upon members and delegates under this Rule; and
(f) Upon the filing of a delegation agreement or renewal notice with the
Exchange, notice thereof shall be posted promptly on the bulletin board,
and shall be made available upon request to the Membership and to the
primary clearing member for the member party to the delegation
agreement.
(g)(i) In accordance with the Agreement entered into on September 1, 1992 ("the
Agreement") between the Exchange and the Chicago Board Options Exchange
("CBOE"), only an individual who is an "Eligible CBOT Full Member" or an
"Eligible CBOT Full Member Delegate", as those terms are defined in the
Agreement, is a "member" of the Exchange within the meaning of paragraph
(b) of Article Fifth of CBOE's Certificate of Incorporation ("Article
Fifth(b)") and only such individuals are eligible to become and to
remain regular members of the CBOE pursuant to Article Fifth(b). No
person who is not either an Eligible CBOT Full Member or an Eligible
CBOT Full Member Delegate shall knowingly apply to become, or knowingly
remain, a regular member of CBOE pursuant to Article Fifth(b) of CBOE's
Certificate of Incorporation.
(g)(ii) For purposes of the "Agreement" referenced in Rule 221.00(g)(i), an
"Eligible CBOT Full Member Delegate" means the individual to whom a CBOT
Full Membership is delegated (leased) and who is in possession of all
trading rights and privileges appurtenant to such CBOT Full Membership.
"Trading rights and privileges appurtenant to such CBOT Full Membership"
means (1) the rights and privileges of a CBOT Full Membership which
entitle a holder or delegate to trade as principal and broker for others
in all contracts traded on the CBOT, whether by open outcry, by
electronic means, or otherwise, during any segment of a trading day when
trading is authorized; and (2) every trading right or privilege granted,
assigned or issued by CBOT after the effective date of this Agreement to
holders of CBOT Full Memberships, as a class, but excluding any right or
privilege which is the subject of an option granted, assigned or issued
by CBOT to a CBOT Full Member and which is not exercised by such CBOT
Full Member. (11/01/99)
221.01 Delegation by Deceased Member's Estate - The legal representative of
a deceased member's estate, during the pendency of probation of the deceased
member's estate, may delegate
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such deceased member's trading privileges in accordance with Rule 221.00. Upon
transfer of the estate assets to the deceased member's heirs, the provisions of
Regulation 249.01 shall apply. (08/01/94)
221.02 Floor Access of Delegating Members and Delegates
(a) A full or associate member who has delegated the rights and privileges of
his only membership, or of all his memberships, for any of the three
trading segments, pursuant to Rule 221.00, and who does not hold a Floor
Clerk or Broker Assistant badge, shall not have physical access to the
Floor of the Exchange for such trading segment(s) during the effective
period of such delegations; provided that this Regulation shall not apply
to "Twenty-Five Year Members" as described in Regulation 301.10.
Provided further, that members of the Board of Directors who have delegated
the rights and privileges of their only membership, or of all of their
memberships, may have physical access to the Floor of the Exchange to the
same extent as do "Twenty-Five Year Members" as described in Regulation
301.10.
(b) A delegate who does not hold a Floor Clerk or Broker Assistant badge shall
not have physical access to the Floor of the Exchange during the trading
segment(s) in which he is not entitled to the rights and privileges of
membership. (07/01/99)
221.03 Minimum Delegation Term - No delegation agreement shall have a term of
less than thirty (30) days. The foregoing limitation shall not apply to
delegation agreements for Full Member Delegates who will utilize their
memberships solely for the purpose of becoming a regular member of the Chicago
Board Options Exchange ("CBOE") pursuant to Rule 210.00 and Article FIFTH(b) of
the CBOE's Certificate of Incorporation. (11/01/99)
221.05 Delegates' Clearing Members -
(1) Except as provided in paragraph (2) below, no delegate may receive clearing
authorization from any Primary Clearing Member, or from any other Clearing
Member, pursuant to Rule 333.00 without first having:
(a) obtained written permission from his/her member-delegator; and
(b) filed such written permission with the Department of Member Services.
(2) In the event that a delegate cannot obtain written permission from his/her
member-delegator before he or she receives clearing authorization from a
new Primary Clearing Member, such delegate may nevertheless obtain such
clearing authorization if the new Primary Clearing Firm executes and
submits to the Department of Member Services a suretyship agreement inuring
to the benefit of the member-delegator and in a form approved by the
Exchange. However, the delegate must obtain his/her member-delegator's
permission within 30 days of changing Primary Clearing Members. If the
delegate does not obtain the permission within that period, he or she will
be denied access to the floor. The delegate will not be able to regain
access to the floor until such permission is submitted to the Department of
Member Services. (04/01/99)
221.07 Voting Rights - On and after June 21, 1982, no full or associate
member may delegate to any other person the right to vote on any matter subject
to a ballot vote among the general membership. (08/01/94)
221.08 Requirements for Delegates of Membership Interests* - The Board, in
its discretion, may require that each person who is granted status as a delegate
of a COM, GIM or IDEM Membership Interest pursuant to a delegation agreement
entered into on or after (effective date to be determined), execute up to a
specified percentage, not to exceed 20%, or a specified number not to exceed 200
of such person's round turn principal transactions per month in one or more
contracts designated by the Board.
The Board may establish different proportions or levels applicable to each
membership interest category, and any such proportion or level shall be applied
in uniform fashion to every delegate in each respective membership interest
category. Consistent with these standards, the Board may alter such proportion
or level at any time.
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Failure to comply with the provisions of this regulation or the directives of
the Board adopted pursuant to this regulation may be considered an act
detrimental to the welfare of the Association. Effective June 1, 1984.
(08/01/94)
221.09 Delegation of Firm-Owned Memberships and Membership Interests - An
eligible business organization registered as a member firm under Rule 230.00 may
delegate the rights and privileges of a firm-owned membership or membership
interest to an individual ("delegate") upon the terms and conditions set forth
in Rule 221.00, but only if the membership being leased is not necessary to
satisfy the requirements for registration as a member firm or, if applicable, as
a clearing member firm. (04/01/98)
221.10 Indemnification of Delegators - To the extent consistent with the
Association's claims Rules and Regulations, the Board of Directors shall honor
and enforce valid indemnifications given by a clearing member to a member or
membership interest holder who delegates the rights and privileges of his
membership or membership interest (the "delegator") in connection with the
delegator's potential liability under Rule 221.00 (c). The indemnification shall
be in writing in such form as the Exchange may prescribe. (08/01/94)
221.11 Delegation by Trust - A trust may delegate the rights and privileges
of any membership(s) or membership interest(s) held by the trust upon the terms
and conditions set forth in Rule 221.00. (07/01/95)
222.00 Multiple Membership - A member may own more than one membership in
his name, and a member firm may own the title and value of more than one
membership pursuant to Regulation 249.01(b). 872 (08/01/94)
224.00 Trades of Non-Clearing Permit Holders - Each permit holder's Primary
Clearing Member is responsible for the payment of the permit holder's dues, fees
and assessments. (08/01/94)
Ch2 Registration
230.00 Registration - An eligible business organization as determined by the
Membership and Financial Compliance Committees may be a member firm of this
Association with respect to all contracts by virtue of a Full membership held in
the name of one of its managerial employees. A managerial employee who desires
to designate an eligible business organization for the above purpose shall make
application to the Membership Committee, giving therein such information as may
be requested. If the application is granted, the membership shall be registered
for the benefit of the eligible business organization, and such eligible
business organization shall be entitled to member firm privileges with respect
to all contracts. For purposes of this Rule and the regulations hereunder, the
term "managerial employee" shall mean any senior employee of the eligible
business organization who is in a managerial position and who is in a position
to influence the firm's operations with respect to commodity futures and options
business on this Exchange. Whether or not a particular employee qualifies as
"managerial employee" shall be in the sole discretion of the Membership
Committee and shall be based on the circumstances and qualifications of the
individual applicant.
A member firm may be a member of the Clearing House and entitled to privileges
therein with respect to all contracts, pursuant to the membership registration
requirements of Rule 703.00. All such memberships shall be registered hereunder
in the manner described above, and under the criteria prescribed in Rule 703.00.
Member firms shall be subject to all requirements and prohibitions contained in
the Rules and Regulations applicable to members, and in such cases, all
registered members shall be subject to discipline and their memberships subject
to sale by the Board for the acts or delinquencies of the firm for which they
are registered. All such designations may be terminated at any time by the
Board, or by the registered member with the written approval of the Exchange.
A member who is a partner of a partnership, an officer, director or substantial
stockholder of a corporation, or a member or manager of a limited liability
company which is engaged in the securities, commodities, or grain business on a
broker or dealer basis or in the processing or storing of commodities shall
register his or her membership for the benefit of such partnership, corporation,
or limited liability company pursuant to the provisions of this Rule, unless
another membership is already registered for such partnership corporation, or
limited liability company; or unless such partnership, corporation, or limited
liability company has filed with the Exchange a duly authorized undertaking that
it will, when required by the Exchange, submit its books and papers or any
portion thereof to the Exchange and furnish any information to or cause any of
its officer, directors, partners, managers, members, and/or employees to appear
and testify before the Exchange. 226 (04/01/98)
230.01 Eligible Business Organizations - Trading Authority - Each member of
the Association whose membership privilege is registered for the use of an
eligible business organization must have the authority to enter into Exchange
and Members' contracts for or on behalf of his or her eligible business
organization. Each registered partnership must keep on file with the Exchange a
copy of its Partnership Agreement and amendments thereto showing the authority
of its designated managerial employees to transact business on the Exchange for
or on behalf of the partnership. Each registered corporation must keep on file
with the Exchange copies of resolutions of its directors, attested to by the
secretary of the corporation, showing the authority of its designated managerial
employees to transact business on the Exchange for or on behalf of the
corporation. Each registered limited liability company must keep on file with
the Exchange copies of the Unanimous Consent of the Members showing the
authority of its designated managerial employees to transact business on the
Exchange for or on behalf of the limited liability company. 1783
Notwithstanding any other Regulation, any member or membership interest holder
who is associated as a partner, shareholder, member, officer, manager, employee,
or consultant with any entity or natural person that is or should be registered
as an Introducing Broker, a Futures Commission Merchant, or a Commodity Trading
Advisor as those terms are defined in Section 1a of the Commodity Exchange Act
and/or 17 C.F.R. 1.3 may not solicit orders of others from the Floor of the
Exchange unless the entity or natural person for which or for whom the member is
soliciting orders is also a member firm or a member of the Exchange. (04/01/98)
230.02 Registration of Membership for Eligible Business Organizations - A
member desiring to register his or her membership for an eligible business
organization under Rule 230.00 shall submit
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a statement giving the name of the eligible business organization and the
business in which it is engaged. If the eligible business organization is
organized as a corporation, the statement must also include the corporation's
authorized and outstanding capital stock. The statement must also show that the
member is a managerial employee of the eligible business organization and is
duly empowered by the eligible business organization to enter into contracts for
and on behalf of the eligible business organization. In addition, the statement
must designate the type(s) of business activity, as measured by the following
list, for which registration is requested:
(1) Clear customer business.
(2) Non-clearing firm handling customers' business on an omnibus basis.
(3a) Non-clearing firm handling customers' business on a disclosed (FCM)
basis.
(3b) Non-clearing firm handling customers' business on a disclosed (agent)
basis.
(4) Clear house trades.
(5a) Non-clearing hedger.
(5b) Non-clearing cash grain firm.
(5c) Non-clearing financial institution.
(6) Professional Trading Firms.
(7) Any other form of business acceptable to the Membership Committee.
If activity levels (1), (2) or (3a) have been designated and the eligible
business organization intends to engage in the commodities or grain business on
a broker or dealer basis, including solicitation or acceptance of orders for the
purchase or sale of commodities futures contracts, the member shall submit a
certified financial report of the eligible business organization, prepared by an
independent Certified Public Accountant as of a date which is no more than 90
days prior to the date of submission. If any other activity level is designated,
the member shall submit a current balance sheet disclosing the eligible business
organization's assets and liabilities. The certified financial report or
complete balance sheet is required only when the member is registering for an
eligible business organization not currently registered with the Exchange.
The Exchange may in its discretion waive or modify the foregoing requirements in
the case of changes in registration necessitated by reorganization of firms
currently registered with the Exchange.
Approval is required for a registered eligible business organization changing or
expanding its type of business to a higher level of business activity as set
forth above. An eligible business organization requesting approval to operate as
a type (1), (2), or (3a) firm which was previously registered as a type (3b),
(4), (5a), (5b), (5c), or (6) or (7) firm must submit a certified financial
statement prior to approval. This certified financial statement must be prepared
by an independent Certified Public Accountant as of a date which is not more
than 90 days prior to the date of submission.
The Exchange may in its discretion grant temporary approval in the case of
changes in registration necessitated by reorganization of firms currently
registered with the Exchange.
Upon receipt of an application for new firm registration for an eligible
business organization, the Secretary shall, within fifteen days thereafter, send
to members of the Association the name of the eligible business organization,
and shall post the same information on the bulletin board for a period of at
least ten days after such notification to the Membership.
An eligible business organization that represents to the Membership Committee
that it will conduct business on the Exchange as a category (6) Professional
Trading Firm must employ at least one active trader who personally executes a
significant portion of his or her orders on the trading floor and/or the Project
A electronic trading system and for the eligible business organization's
proprietary account. The failure to maintain at least one active trader on the
floor could be deemed a violation of Rule 204.00 and/or Rule 503.00 and may
result in sanctions as provided by those rules.
No member may register his or her membership for more than one eligible business
organization.
No member may register his or her membership for any eligible business
organization under the Rules
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of this Exchange, where such membership is or becomes delegated under the
provisions of Rule 221.00.
An eligible business organization which has been conditionally approved for
member firm status shall have sixty (60) days after the date that it was
notified of such approval, or within such extension of said period as may be
granted by the Exchange, to satisfy any conditions or contingencies imposed on
such approval. If the conditions or contingencies are not satisfied by the
applicable deadline, the Committee's approval of the eligible business
organization for member firms status shall be deemed void. 1060 (10/01/99)
230.03 Designated Persons -
(a) Subject to approval by the Association, which approval is in the absolute
discretion of the Association, each eligible business organization
("member") of the Association shall designate one or more senior
managerial employees responsible for the member's financial, compliance,
operational and ultimate supervisory obligations and activities as a
member. Such individuals must either: (i) have a membership registered on
behalf of the member, or (ii) be registered with the Association by the
member as a "Designated Person". A Designated Person shall be subject to
the Rules and Regulations of the Association as if a member; provided,
however, that a Designated Person shall not be liable for the actions
and/or omissions of other employees, agents or independent contractors if
the member of the Designated Person demonstrates to the satisfaction of
the Association that all of his or her relevant conduct on behalf of the
member was performed in good faith with reasonable care.
(b) Any individual not a registered member or Designated Person or
nonmember eligible business organization which holds more than a 25%
financial interest in a member eligible business organization ("member")
or who exercises actual control over the management of the member may, at
the Association's sole discretion, be required to execute a Consent to
Jurisdiction in such form as may be prescribed by the Association. Upon
the member's request, the Membership and Financial Compliance Committees
may exempt individuals and/or eligible business organizations from this
requirement for good cause shown. (04/01/98)
230.04 Cooperative Association of Producers - A lawfully formed and
conducted cooperative association of producers having adequate financial
responsibility, engaged in any cash commodity business, conforming to the
following requirements:
FIRST: The Cooperative Association must have not less than 75 per centum
of the voting capital stock or membership capital, in good faith owned
and controlled, directly or indirectly by producers of agricultural
products;
SECOND: The Cooperative Association, if organized without capital stock,
shall not allow a member of the Cooperative Association more than one
vote, or if organized with capital stock, the Cooperative Association
shall not pay dividends on any class of capital stock in excess of 8 per
cent per annum cumulative;
THIRD: The Cooperative Association shall not, during any fiscal year,
deal in the products of non- members of the Cooperative Association to an
amount greater in value than such as is handled by it for members of the
Cooperative Association;
FOURTH: The Cooperative Association, not more frequently than semi-
annually, may pay out of its accumulated or current earnings and savings,
patronage dividends to members of the Cooperative Association only and
upon the basis of business transacted with such members for the period
covered by transactions in which such earnings and savings have accrued;
and
FIFTH: The Cooperative Association, if organized under the Cooperative
Laws of any state, or recognized as a cooperative association of
producers by the United States Government, or any agency thereof;
may be a member firm of the Association with respect to all contracts and may be
entitled to do business in cash grain on the Floor, by virtue of a membership
held in the name of one of its duly authorized representatives and registered
under Rule 230.00 on behalf of the cooperative association. A member who desires
to designate such a cooperative association of producers for that purpose shall
make application to the Membership Committee, giving therein such information as
may be requested
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(Rule 230.00). Such designation may be terminated at any time by the Board, or
by such member with the written approval of the Exchange. A cooperative
association of producers shall be subject to all requirements and prohibitions
contained in the Rules and Regulations applicable to members (except as may be
exempted by the Commodity Exchange Act and the regulations of the Commodity
Futures Trading Commission issued thereunder) and in such cases the member shall
be subject to discipline and the membership subject to sale by the Board for the
acts or delinquencies of the cooperative association. 1062 (04/01/98)
230.05 Registration for Trading on the Floor in Cash Grain - An eligible
business organization may be entitled to trade in cash grain in its own name if
one of its managerial employees, a member of the Association, has registered his
or her membership for the eligible business organization in accordance with Rule
230.00 and Regulation 230.02. 1061 (04/01/98)
230.06 Eligible Business Organization Status Upon Death or Withdrawal of
Registered Member - Upon the death or withdrawal of a member whose membership
is registered on behalf of an eligible business organization, where such death
or withdrawal would result in failure of the eligible business organization to
meet the requirements of Rule 230.00, Rule 703.00, Regulation 230.02 or
Regulation 230.05, the Exchange may, upon application of the registered eligible
business organization, grant the eligible business organization an extension of
privileges under the applicable Rules and Regulations for such period and under
such conditions as the Exchange may fix. Upon the death or withdrawal of a
member whose membership is registered on behalf of an eligible business
organization, the eligible business organization shall, within five business
days of such death or withdrawal, notify the Exchange of the departure of its
registered member. Failure to comply with the provisions of this Regulation
shall be referred to the Business Conduct Committee, for possible disciplinary
action pursuant to Rule 540.00. 1063 (04/01/98)
230.07 Primary Clearing Member Permission for Member Registration - A member
may register his or her membership for an eligible business organization under
Rule 230.00, if that eligible business organization is not his or her Primary
Clearing Member, only if he or she has written permission to do so from his or
her Primary Clearing Member. Such written permission of the Primary Clearing
Member must be filed with the Member Services Department. (04/01/98)
230.08 Doing Business in Firm (or Trade) Name - No member may conduct business
with the public as a partnership under a firm name unless the partnership has at
least one general partner other than such member; provided, however, that if by
death or otherwise, the member becomes the sole general partner of the firm, he
or she may continue business in the firm name for such period as may be allowed
by the Exchange. 1070 (04/01/98)
230.09 Formation of Partnerships or Limited Liability Companies - When a
member intends to form a partnership or admit other individuals to an existing
partnership, he or she shall notify the Secretary in writing to that effect. On
receipt of such notice from a member, the Secretary shall cause the same to be
posted upon the bulletin board of the Association. A member shall promptly
notify the Secretary of the retirement of any partner from the member firm
partnership or of the dissolution of such partnership.
When a member intends to form a limited liability company or admit other
individuals to an existing limited liability company, he or she shall notify the
Secretary in writing to that effect. On receipt of such notice from a member,
the Secretary shall cause the same to be posted upon the bulletin board of the
Association. A member shall promptly notify the Secretary of the retirement of
any other member from the member firm limited liability company or of the
dissolution of such limited liability company. (04/01/98)
230.10 Suspended or Insolvent Members - A member shall not form a partnership
or limited liability company nor, unless permitted by the Regulatory Compliance
Committee, continue in a partnership or limited liability company with any of
the following:
(a) A member whose membership privileges have been suspended by the
Association;
(b) Any person who has been expelled from the Association as permitted by
Rule 560.00;
(c) An insolvent person; or
(d) Any previous member of the Association against whom any member holds
a claim which
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arises out of transactions made during the time of such membership
and which have not been released or settled. (04/01/98)
230.11 Discipline of Partners or Members of Limited Liability Companies - A
member of the Association who is a general partner of a member firm of the
Association is liable to the same discipline and penalties for any act or
omission of said firm as for his or her own personal act or omission, but the
Regulatory Compliance Committee may, in its discretion, by a vote of not less
than two-thirds of its members present, relieve him or her from the penalty
therefor.
A member of the Association who is also a member of a limited liability company
which is a member firm of the Association is liable to the same discipline and
penalties for any act or omission of said firm as for his or her own personal
act or omission, but the Regulatory Compliance Committee may, in its discretion,
by a vote of not less than two-thirds of its members present, relieve him or her
from the penalty therefor. 1076 (04/01/98)
230.12 Dissolution of Partnership or Limited Liability Company - Whenever it
shall appear to the Regulatory Compliance Committee that a member has formed a
partnership or limited liability company or has become an officer, employee, or
stockholder of a corporation or established an office or headquarters or is
individually, or through any member of his or her firm, interested in a
partnership or other business organization, or has formed any business
connection whatever whereby the interest or good repute of the Association may
suffer, the Regulatory Compliance Committee may require the dissolution of any
such partnership or limited liability company or discontinuance of such business
office, or headquarters, or business connection as the case may be. (04/01/98)
230.13 Relations Controlling Policy - Whenever it shall appear to the
Regulatory Compliance Committee that a member individually or through his or her
firm or a partner or partners therein, has such a business connection with a
corporation or other business organization that the corporation or other
business organization dominates the business of the member or firm or controls
the policy of such business, the Regulatory Compliance Committee may require the
discontinuance of such business connection. (04/01/98)
230.14 Delegation of Approval Authority - The Chairman of the Membership
Committee, or a member of the Membership Committee who has been designated by
the Membership Committee Chairman or the Member Services and Member Firm Staff
Services Department upon delegation by the Chairman, will have the authority to
approve the application of a Full or Associate Member to register his or her
membership for an eligible business organization under Rule 230.00 and the
regulations thereunder; provided that the eligible business organization is
currently registered in accordance with Rule 230.00. The power to deny such
applications is expressly reserved to the Regulatory Compliance Committee. With
respect to firm-owned Full and Associate Memberships under Regulation 249.01(b),
the Chairman of the Membership Committee or a member of the Membership Committee
who has been designated by the Membership Committee Chairman may determine that
such memberships are needed by the registered eligible business organization to
carry out its business at the Association.
For the purpose of this regulation, the Chairman may not delegate approval
authority to the Member Services and Member Firm Staff Services Department when
the applicant has answered affirmatively to any question in the "Disciplinary
Action" section of the Member Firm Registration application. (12/01/98)
230.15 Financial Requirements - (See Reg. 285.05) (04/01/97)
230.16 Designated Liaison - An eligible business organization registered as a
member firm of this Association under Rule 230.00 and Regulation 230.02 is
required to designate a specific managerial employee as liaison to the Exchange.
This designated liaison will be responsible for ensuring the firm's compliance
with and understanding of the Exchange's Rules and Regulations, and must have a
command of the English language. This designated liaison must have a membership
registered for the eligible business organization. (04/01/98)
230.17 Changes in Organization - Any change in the organizational structure
of a member firm requires the Exchange's prior approval. Organizational changes
shall include, but not be limited to: i) a corporation, limited liability
company, general partnership, limited partnership or sole proprietorship
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which changes to another form; or ii) replacement of any general partner or
member of any limited liability company. Any failure to comply with this
Regulation and any such change in organizational structure that does not comply
with the requirements to be a member firm shall be referred to the Business
Conduct Committee for possible disciplinary action pursuant to Rule 540.00. The
Exchange may grant the member firm a period of time in which to come into
compliance with the requirements for member firm status. The Business Conduct
Committee may also determine whether such a member firm is entitled to member
transaction fees for any time period in which the firm fails to comply with
requirements. (04/01/98)
231.00 Ownership and Registration of Associate Memberships - With the
approval of the Membership Committee ownership of title and value of an
Associate membership of an individual, approved under Rules 200.00, 201.00,
159.00, and 202.00, may be vested in an eligible business organization
registered in accordance with Rule 230.00 provided that all of the provisions of
Regulation 249.01 - Transfer of Membership - are complied with, where
applicable.
Associate memberships may be registered on behalf of an eligible business
organization pursuant to Rule 230.00. 875 (04/01/98)
Ch2 Assessments and Fees
240.00 Assessments - The Board, prior to the Annual Meeting and quarterly
thereafter during each year, shall levy upon the membership such assessments as
it may deem necessary or advisable to meet any anticipated operating deficit of
the ensuing quarter and any actual deficit of the preceding quarter and such
assessment as the Board may deem necessary or advisable to meet any capital
expenditures of the ensuing quarter, including the retirement of mortgage
indebtedness encumbering the Board of Trade Building. It shall be the duty of
the President to prepare and submit to the Board, in advance of the meeting at
which any such assessment is levied, a detailed budget showing the deficit, if
any, for the preceding quarter and the amount of each such assessment proposed
to be levied. Each such quarterly assessment shall be billed to the members as
near the beginning of the quarter as may be practicable and shall become due and
payable within thirty days after such billing. 108 (08/01/94)
241.00 Members in Military Service - The Board shall have authority to remit
the assessments of a member during the period in which such member is in the
military service of the United States, as such service is defined in the
Soldiers' and Sailors' Civil Relief Act of 1940, as passed by Congress and as it
may be amended. 108B (08/01/94)
241.01 Dues of Members in Military Service - In accordance with the authority
granted the Board under the provisions of Rule 241.00 no assessment of a member
shall be remitted under Rule 241.00 except under the following conditions:
1. Each petition for the benefits of Rule 241.00 will be considered on its
merits.
2. No petition will be considered unless accompanied with funds sufficient to
pay all dues up to and including the full month in which the Board acts on
the request.
3. No petition will be approved unless the petitioner became a member of the
Association prior to January 1, 1953.
4. When a petition is granted the member is required to notify the Secretary
promptly of the termination of his military service. 1844A (08/01/94)
242.00 Neglect to Pay Assessment - Any member who neglects to pay his
assessment, or installments thereof, within thirty days after such assessment,
or installments thereof, has been called for payment may be suspended until such
assessment, or installments thereof, is paid. If a member neglects to pay such
assessment, or installments thereof, during a period of six consecutive months,
his membership (a) may be disposed of by the Board; (b) or may be forfeited and
cancelled by the Board. 109 (08/01/94)
243.00 Transfer Fees - No transfer of membership may be consummated unless
the transferee pays to the Association a transfer fee. The amount of this fee is
established from time to time, by the Board of Directors. The transfer fee so
collected shall be used to purchase, retire or redeem indebtedness to finance
improvements to the Board of Trade Buildings or to pay the cost of such
improvements. The transfer fee described in this Rule 243.00 shall not apply
when the transferor is the estate of a deceased member or membership interest
holder and the transferee is the decedent's spouse or the decedent's child. 111
(07/01/98)
243.01 Sale and Transfer of Membership Privileges - Each individual
submitting an application for membership shall include with the application a
non-refundable application fee established by the Board. The application fee
described in this Regulation 243.01 shall not apply when the applicant is the
spouse or the child of a deceased member or membership interest holder. The
application fee will also not apply when a deceased member or membership
interest holder's membership or membership interest is held in trust pursuant to
Regulation 249.01(i), the appplicant is the spouse or the child of the decedent,
and under the terms of the trust, the applicant is the successor trustee to the
deceased member or membership interest holder. 1807 (04/01/98)
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
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249.01 Purchase and Sale or Transfer of Membership or Membership Interest -
Membership status in this Association is a personal privilege, not subject to
sale or transfer except as herein authorized.
(a) Purchase and Sale of Memberships and Membership Interest by Individuals -
(i) When an individual wishes to sell his full or associate membership or
membership interest, he shall sign an offer to sell including an
offer price, in such form as shall be prescribed by the Exchange.
When an offer is matched to a bid, the member or registered eligible
business organization may receive the sale proceeds prior to the
expiration of the claims period or the resolution of any claims by
depositing treasury bills with the Association, equivalent to the
sale price of the membership or membership interest. All amounts
deposited shall be available, without restriction, to satisfy claims
against the departing member or the registered eligible business
organization under this Chapter. In lieu of a deposit, the member or
registered eligible business organization may file a clearing firm
guaranty, letter of credit, or such other form as the Association may
permit, equivalent to the sale price of the membership or membership
interest, for the satisfaction of claims.
(ii) Any individual who wishes to purchase a full or associate membership
or membership interest subsequent to his approval for a particular
membership status shall execute and deliver to the Department of
Member Services a bid to purchase such membership or membership
interest, in such form as may be prescribed by the Exchange. The bid
shall be accompanied by a certified or cashier's check representing
an earnest money deposit in the amount of fifteen percent of the bid,
by an irrevocable letter of credit in the amount of fifteen percent
of the bid, or by an agreement on a form prescribed by the Exchange
and executed by a clearing member of the Association as provided in
this section (ii).
Any individual who wishes to purchase a full or associate membership
or membership interest prior to his approval for a particular
membership status shall execute and deliver to the Department of
Member Services a bid to purchase such membership or membership
interest, in such form as may be prescribed by the Exchange. The bid
shall be accompanied by a check in the amount of the applicable
transfer fee. The bid shall also be accompanied by a certified or
cashier's check in the amount of such bid or by an agreement on a
form prescribed by the Exchange and executed by a clearing member of
the Association which shall provide that in the event the prospective
purchaser's bid is matched to an offer, as provided in section (iii)
below, and the prospective purchaser fails to make payment in the
amount of his bid by 5:00 p.m. of the next business day following the
day on which he was notified by the Department of Member Services
that his bid was matched to an offer, such clearing member shall
purchase the membership or membership interest in question for the
full amount of such bid.
The bid shall contain an agreement by such individual to take no
recourse against the Association in the event he is not approved for
membership, except as may be permitted under Section 8c of the
Commodity Exchange Act as amended and a release of the Association of
any claim or right that such individual would otherwise have had by
reason of such failure to be so elected. The bid also shall contain
an agreement by such individual that he or she consents to and
accepts the Exchange's jurisdiction with respect to any disciplinary
action or other matter within the purview of any Exchange committee
from the date of purchase of a membership or membership interest
until the date the individual is approved for membership status or,
if such individual fails to be approved for membership status, until
the date of a sale of the membership or membership interest is
effected in accordance with this regulation. With respect to the
purchase of a membership which will be registered pursuant to Rule
230.00 for the benefit of an eligible business organization which is
not currently a member firm, a consent to jurisdiction also must be
executed on behalf of the firm. The consent to jurisdiction shall
expressly state that the Exchange may hold the membership or
membership interest pending the disposition of any proceeding before
any Exchange Committee and apply the proceeds from the sale of the
membership or membership interest toward the satisfaction of any
decision that may be rendered against the individual or firm.
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
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Nothing herein shall be construed in any way to limit the Exchange's
jurisdiction over all individuals and firms which have been approved
for membership. If any purchase of a membership or membership
interest is being financed by a person other than the purchaser, such
purchaser shall file satisfactory proof as required by the Department
of Member Services that the financing party is aware of the
provisions of this Regulation and Rule 252.00.
(iii) The Department of Member Services shall post continually on the
Bulletin Board the lowest offer to sell and the highest bid to buy
full and associate memberships and membership interests,
respectively. In the event of a match between any such bid and offer,
the Department of Member Services shall notify the purchaser and the
seller. In the event there are two bids and/or two offers in the same
amount, the oldest offer shall be matched to the oldest bid. Title
and value of the membership or membership interest shall be
transferred to the purchaser upon payment being effected in the full
amount of the bid.
In the event that the prospective purchaser fails to make payment in
the amount of his bid by 5:00 p.m. of the next business day following
the day on which he was notified by the Department of Member Services
that his bid was matched to an offer, the clearing member who has
executed an agreement to purchase the membership or membership
interest as provided in section (a)(ii) of this Regulation shall make
payment in the full amount of the bid by 5:00 p.m. of the business
day following the day upon which payment was due from the prospective
purchaser. Upon becoming the owner of the title and value of the
membership or membership interest, the clearing member shall either
sell or transfer the membership or membership interest or cause the
membership or membership interest to be registered on its behalf in
accordance with Rule 230.00 of these Rules and Regulations.
Failure to fulfill the obligations set forth in said agreement shall
constitute acts detrimental to the interest and welfare of the
Association.
Within ten (10) business days of notice to the purchaser by the
Department of Member Services that his or her bid has been matched to
an offer, each purchaser of a full or associate membership who is not
a full or associate member in good standing, and each purchaser of a
membership interest who is not a full or associate member, membership
interest holder or nominee thereof, or delegate in good standing,
shall file with the Department of Member Services an application for
the appropriate membership status, in such form as may be prescribed
by the Exchange, in order to be eligible for approval for membership
status. Such form shall include an agreement by the applicant to take
no recourse against the Association in the event he or she is not
approved for a particular membership status, except as may be
permitted under Section 8c of the Commodity Exchange Act as amended
and a release of the Association of any claim or right that such
individual would otherwise have had by reason of such failure to be
so elected. No person may exercise the rights of a particular
membership status until he or she is approved for such membership
status in accordance with these rules.
(iv) If a purchaser of a membership or membership interest fails to file
an application with the Department of Member Services as required in
paragraph (iii) above, is not approved for membership status, or if
for any reason his application is withdrawn, the Exchange shall
retain the transfer fee and the purchaser shall assume all risk of
gain or loss from the resale of the membership or membership interest
purchased by him. The purchaser shall take all necessary steps to
effect a sale of the membership or membership interest purchased by
him within thirty (30) days of notification of his failure to be
approved for membership status, withdrawal of his application, or the
purchase of the membership or membership interest if he failed to
file an application.
(v) If the purchaser fails to effect a sale within the time period
specified in paragraph (iv) above, the Department of Member Services
shall effect a sale at the price of the highest bid to purchase then
on file with the Department of Member Services on the next business
day following the thirtieth (30) day after notification of his
failure to be approved for membership status, withdrawal of his
application, or the purchase of the membership or membership interest
if he failed to file an application. If on the next business day
following the thirtieth day after such notification, withdrawal, or
purchase if he failed to file an application, there is no bid to
purchase on file with the Department of Member Services, the
membership or membership
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
----------------------------------------------------------------------
interest shall be offered for sale by the Exchange at the same price
as the lowest offer to sell then on file with the Department of
Member Services. Such offer shall be matched with a bid in accordance
with Regulation 249.01(a)(iii). The total amount realized from the
sale of the membership or membership interest shall be remitted to
the unsuccessful applicant in full satisfaction of all obligations of
the Association, subject to Exchange Rule 252.00.
(vi) An individual whose offer to sell his only membership or membership
interest has been accepted by a purchaser, shall not make any
Exchange contracts after the date of such consummation of the
transfer.
An individual whose membership or membership interest status was
terminated through a sale in accordance with this paragraph (a), and
who was a member or membership interest holder in good standing, not
subject to any Exchange investigation, charges, suspension or
disciplinary action at the time of such sale, shall remain eligible,
for a period of six (6) months following such sale, to purchase
another membership or membership interest under the provisions of
this paragraph (a), to be the transferee of a membership or
membership interest pursuant to subparagraphs 249.01(b) (c) or (d) or
to become a delegate, in accordance with provisions of Regulation
202.01. The Exchange may, in its discretion, grant extensions to this
six (6) month approval period.
(b) Transfer by registered eligible business organization
(i) With the approval of the Membership Committee, ownership of the title
and value of a full or associate membership of an individual,
approved under Rules 200.00, 201.00, 159.00 and 202.00 may be vested
in an eligible business organization registered in accordance with
Rule 230.00 provided that (i) the approved individual is a managerial
employee as that term is defined in Rule 230.00 of such registered
eligible business organization; (ii) the managerial employee's
membership is registered for such eligible business organization; and
(iii) the Membership Committee determines that such membership is
needed by the registered eligible business organization to carry on
its business at the Association. Additionally, with the approval of
the Membership Committee, a registered eligible business organization
may own GIM, COM and IDEM membership interests on behalf of
individual nominees who are full-time employees of such firm in
accordance with the provisions of Rules 291.00, 292.00 and 293.00. In
such circumstances, all rights and responsibilities of membership
shall remain the exclusive personal privilege of the approved
individual, except that the registered eligible business organization
shall be entitled to transfer such membership or membership interest,
and to receive the net proceeds from transfer of such membership or
membership interest after satisfaction of all claims against the
approved individual, or against the registered eligible business
organization, in accordance with Rules 252.00 and 253.00 of this
Chapter.
(ii) A registered eligible business organization owning the title and
value of a full membership, associate membership, or membership
interest may transfer said membership or membership interest to
another approved individual who is also a managerial employee of the
eligible business organization, by delivering to the Department of
Member Services a report of intention to transfer upon such form as
shall be prescribed by the Exchange. In addition, with respect to the
transfer of a full or associate membership, the firm must deposit
with the Department of Member Services an amount equal to the
weighted average of all full or associate membership sales for the
preceding calendar month, as appropriate. With respect to the
transfer of a membership interest, the firm must deposit the greater
of $50,000 or an amount equal to the weighted average of all GIM, COM
or IDEM sales, for the preceding calendar month, as appropriate. Such
amount may be deposited in cash, treasury bills, or such other form
as the Association may permit. All amounts deposited shall be
available, without restriction, to satisfy claims against the
departing approved individual or against the registered eligible
business organization under this Chapter. In lieu of a deposit, a
firm may file a clearing firm guaranty for the satisfaction of claims
in an amount that accords with the formulas set forth in this sub-
paragraph. Should the departing approved individual be leaving the
employ of the member firm, the application for membership or transfer
documents of the transferee must be submitted to the Association
within thirty (30) days from the termination date of the departing
approved individual. The Exchange may, in its discretion, grant
extensions of this 30 day approval period. No such extension shall
exceed 60 days total length for any individual.
Ch2 Purchase and Sale or Transfer of membership or Membership Interest
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(iii) Nothing herein shall preclude or impair the right of the Exchange to
impose discipline upon the registered eligible business organization,
or upon the approved individual, or to dispose of the membership or
membership interest of any approved individual, for the acts or
delinquencies of the registered eligible business organization, or
for the acts or delinquencies of the approved individual, in
accordance with the Rules and Regulations of the Association.
(iv) An approved individual whose only remaining membership or membership
interest has been transferred in accordance with this paragraph (b)
shall not make any Exchange contracts after the date of such
transfer.
(v) In the event that a registered eligible business organization owning
the title and value of a full or associate membership or membership
interest is acquired by another registered eligible business
organization through the purchase of 100% of the partnership or
limited liability company property or corporate stock, the acquiring
eligible business organization may transfer said membership or
membership interest to another approved individual who is a
managerial employee of the acquiring eligible business organization
by complying with the procedures set forth in sub-paragraph (ii),
hereof.
A registered corporation that owns the title and value of a full or
associate membership or member interest may transfer said membership
or membership interest to another approved individual who is a
managerial employee of its wholly-owned registered subsidiary
corporation or its registered parent partnership or corporation which
owns 100% of its stock, or a sister corporation that is 100% owned by
the parent entity, by complying with the procedures set forth in sub-
paragraph (ii), hereof. A registered partnership that owns the title
and value of a full or associate membership or membership interest
may transfer said membership or membership interest to another
approved individual who is a managerial employee of its wholly-owned
registered subsidiary or a sister entity that is 100% owned by the
parent entity, by complying with the procedures set forth in sub-
paragraph (ii), hereof. A registered limited liability company that
owns the title and value of a full or associate membership or
membership interest may transfer said membership or membership
interest to another approved individual who is a managerial employee
of its wholly-owned registered affiliate or a sister affiliate that
is 100% owned by the parent entity by complying with the procedures
set forth in sub-paragraph (ii), hereof. Each such transfer of a GIM
Membership Interest shall count toward the two transfers specified in
Rule 296.00 (2).
(vi) The parties to the transfer set forth in sub-paragraph (ii) of this
paragraph may elect not to deposit a sum of money or file a clearing
firm guaranty agreement as provided therein, in which case the
transferee shall, for a period of time equal to that set forth in
paragraph (e) of this Regulation, be ineligible to exercise any of
the rights and privileges of the transferred membership or membership
interest and, during this time and no other, all claims as set forth
in sub-paragraph (ii) of this paragraph against the transferor shall
be filed. If such claims are filed the transferee shall remain
ineligible until the claims are satisfied or otherwise disposed. In
order to satisfy claims set forth in sub-paragraph (ii), which have
been properly filed and allowed by the Association, as provided by
the Rules and Regulations, the transferred membership or membership
interest may be sold by the Association. In the event of such sale
and after the claims have been paid, the remaining surplus, if any,
of the proceeds of sale shall be paid to the registered eligible
business organization upon execution by it of a release which is
satisfactory to the Association. In order to preclude the sale of the
membership or membership interest by the Association for the
satisfaction of claims, and for the transferee to become immediately
eligible to exercise the rights and privileges of the transferred
membership or membership interest, the registered eligible business
organization may, in the alternative, deposit a sum of money or file
a clearing firm guaranty as provided in sub-paragraph (ii) hereof.
(vii) An approved individual whose membership or membership interest status
was terminated through a transfer in accordance with this paragraph
(b), and who was a member or membership interest holder in good
standing, not subject to any Exchange investigation, charges,
suspension or disciplinary action at the time of such transfer, shall
remain eligible, for a period of thirty (30) days following such
transfer, to purchase another membership or membership interest under
the provisions of this paragraph (a) or to be the transferee of a
membership or membership interest pursuant to subparagraphs 249.01
(b) (c) or (d) in accordance with provisions of Regulations 202.01
and/or 230.18 , as applicable. The
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
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Exchange may, in its discretion, grant extensions of this 30 day
approval period. No such extension shall exceed 60 days in total
length for any individual.
(c) Transfer by member under loan agreement -
(i) Whenever, under the Rules and Regulations, a registered eligible
business organization is required to register a certain number of
full or associate memberships or is required to maintain memberships
for other purposes, such eligible business organization may execute
with an employee, approved for membership under this Chapter, a loan
agreement in such form as the Association may prescribe, advancing to
such employee the cost of membership and providing for the enforced
repayment of such advance. The employee may transfer his membership
to another employee of the same registered eligible business
organization, approved for membership under this Chapter, upon the
deposit with the Department of Member Services of an amount equal to
the sum specified in sub-paragraph (ii) of paragraph (b) of this
Regulation. All amounts so deposited shall be available, without
restriction, to satisfy claims under this Chapter. Should the
transferor be leaving the employ of the registered eligible business
organization, the application for membership of the transferee must
be submitted to the Association within thirty (30) days from the
termination date of the transferor.
(ii) Transfer under this paragraph (c) except as provided in sub-paragraph
(i) hereof, shall be governed by the provisions of paragraph (a) of
this Regulation.
(d) Transfer within family -
(i) It shall be permissible, under the Rules and Regulations, to transfer
a full or associate membership or membership interest between members
of the same family (a spouse, parent,
child, grandparent, or grandchild), or a decedent's membership or
membership interest within the same family, provided such transferee
is approved for the appropriate membership status under this Chapter
and a clearing firm guaranty is filed, or sum of money as described
in paragraph (b) is deposited with the Department of Member Services
in order to satisfy claims.
(ii) The parties to the transfer may elect not to deposit a sum of money
as provided in paragraph (b), in which case the transferee shall, for
a period of time equal to that set forth in paragraph (e) of this
Regulation, be ineligible to exercise any of the rights and
privileges of the transferred membership or membership interest, and
during this time and no other, all claims against the transferor
shall be filed. If such claims are filed the transferee shall remain
ineligible until the claims are satisfied or otherwise disposed. In
order to satisfy claims against the transferor, which have been
properly filed and allowed by the Association, as provided by the
Rules and Regulations, the transferred membership or membership
interest may be sold by the Association. In the event of such sale
and after the claims have been paid, the remaining surplus, if any,
of the proceeds of sale shall be paid to the transferee, or his legal
representative, upon execution by him of a release which is
satisfactory to the Association. In order to preclude the sale of the
membership or membership interest by the Association for the
satisfaction of claims, and to become immediately eligible to
exercise the rights and privileges of the transferred membership or
membership interest, the transferee may, in the alternative, comply
with the provisions of sub-paragraph (i), hereof.
(iii) Transfer under this paragraph (d), except as provided in sub-
paragraph (i) and (ii) hereof, shall be governed by the provisions of
paragraph (a) of this Regulation.
(e) Notice of membership sale or transfer and filing claims -
(i) On the first and sixteenth calendar day of each month (or if the
first or sixteenth is not a business day on the following business
day ("notice days")), the Secretary shall post on the bulletin board
located on the Exchange floor a notice listing each sale or transfer
of a membership, each termination or expiration of a delegation
agreement, each termination of an individual member registration and
each termination of a member firm registered in accordance with the
provisions of Rule 230.00 that occurred during the period beginning
on the preceding notice day and ending on the business day preceding
the current notice day. The Secretary shall also notify the
Membership in writing of such events by direct mailing. The last day
for filing claims pursuant to Rule 253.00 against the proceeds of the
sale or
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transfer of a membership, the termination of an individual member
registration, a termination of a member firm or pursuant to Rule
221.00 (c)(2) against a delegate whose delegation agreement has
terminated or expired is the business day immediately preceding the
notice day that follows the notice day on which the Secretary posts a
notice on the bulletin board announcing such sale or transfer or such
termination or expiration of a delegation agreement. The Exchange
shall hold the proceeds from the sale or transfer of a membership
until such time as the relevant claims period has run and/or any
disputed claims have been resolved.
(ii) Upon the effective date of sale or transfer of an individual's sole
membership, all Exchange contracts of the seller or transferor shall
mature, and if not settled, shall be closed out as in the case of
insolvency, unless the same are assumed or taken over by another
member of the Association.
(iii) The name of a member whose membership or membership interest has
been disposed of by the Board shall be posted as in the case of a
voluntary sale and such posting shall have the same effect in respect
to open contracts and unmatured debts and obligations of the former
member as in the case of a voluntary sale.
(f) Sale by Legal Representative -
(i) The membership or membership interest of a deceased member or
membership interest holder may be sold pursuant to an offer to sell
executed by the executor, administrator or other duly qualified and
appointed legal representative of his estate.
(ii) The full or associate membership or membership interest of a member
or membership interest holder who has been adjudicated incompetent
may be sold pursuant to an offer to sell executed by his duly
appointed guardian, conservator or other duly qualified legal
representative.
(g) Indirect Exchange of Memberships -
(i) A member may exchange an associate membership for a full membership
(an "AM Swap"), a full membership for an associate membership (an "FM
Swap"), a GIM membership interest for an associate membership (a "GIM
to AM Swap"), a GIM membership interest for a full membership (a "GIM
to FM Swap"), a COM membership interest for an associate membership
(a "COM to AM Swap"), a COM membership interest for a full membership
(a "COM" to FM swap") an IDEM membership interest for an associate
membership (an "IDEM to AM swap") or an IDEM membership interest for
a full membership (an "IDEM to FM swap"), by signing an offer to
exchange in such form as shall be prescribed by the Exchange. The
offer to exchange shall specify the category of membership being
relinquished (the "relinquished membership"); the category of
membership the exchanging member wishes to acquire (the "replacement
membership")' and the "Price Differential" at which the exchange is
to be effected (as described below).
The offer to exchange shall be accompanied by: (1) In the case of an
AM, GIM to AM, GIM to FM, COM to AM, COM to FM, IDEM to AM or IDEM to
FM Swap, a certified or cashier's check in the amount of the Price
Differential, or an agreement of a clearing member of the Association
as described in section (a)(ii) of this Regulation; and (2) an
agreement of a clearing member of the Association to pay to the
Association in cash upon demand the amount of any assessments or
claims against the exchanging member's relinquished membership
according to Rule 252.00 up to the value of the relinquished
membership at the time the exchange is accepted. For this purpose,
the value of the relinquished membership will be the bid price for
such membership.
(ii) The Department of Member Services shall post continually on the
Bulletin Board the highest Price Differential for AM, GIM to AM, GIM
to FM, COM to AM, COM to FM, IDEM to AM and IDEM to FM swaps, and the
lowest Price Differential for FM swaps. In the event there are two or
more AM swaps, two or more FM swaps, two or more GIM to AM Swaps, two
or more GIM to FM Swaps, two or more COM to AM Swaps, two or more COM
to FM Swaps, two or more IDEM to AM swaps or two or more IDEM to FM
Swaps offered at the same Price Differential, the oldest offer shall
be listed first.
(iii) The Department of Member Services shall notify an exchanging member
that the member's offer to exchange has been accepted when (1) the
difference between the bid price for
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memberships in the category of the relinquished membership and the
offer price for memberships in the category of the replacement
membership equals (2) the Price Differential for the offer to
exchange. Upon notification of acceptance of the offer to exchange,
the Department of Member Services shall cause the Association to
acquire the relinquished membership from the exchanging member, sell
the relinquished membership at its bid price, acquire the replacement
membership at its offered price, and transfer the replacement
membership to the exchanging member. The exchanging member shall pay
the applicable transfer fee not later than 5:00 p.m. of the first
business day following acceptance of the offer to exchange.
(iv) If, prior to acceptance of an offer to exchange, the posted Price
Differential for AM Swaps matches the posted Price Differential for
FM Swaps, the Department of Member Services will notify the
respective members and will effect a direct exchange of their
memberships according to paragraph (h) below.
(v) Title and value of the relinquished membership shall pass to the
Association, and title and value of the replacement membership shall
be transferred to the exchanging member, upon notification by the
Association that the exchange offer has been accepted.
(vi) The proceeds from the sale of the relinquished membership shall be
applied to payment for the replacement membership. Any excess
proceeds shall be applied in the manner specified in Rule 252.00 to
satisfy assessments and claims against the relinquished membership.
The exchanging member shall only be entitled to the replacement
membership and any excess proceeds (subject to application of Rule
252.00); in no event shall the exchanging member be entitled to
demand receipt of the proceeds from the sale of the relinquished
membership in lieu of receipt of the replacement membership.
(vii) If the exchanging member in an AM, GIM to AM, GIM to FM, COM to AM,
COM to FM, IDEM to AM or IDEM to FM swap fails to make payment for
the Price Differential by 5:00 p.m. of the next business day
following the day on which the member was notified by the Department
of Member Services that the member's offer to exchange was accepted,
the exchanging member shall forfeit ownership of the title and value
of the replacement membership and the clearing member who has
executed an agreement to purchase the membership as provided in
section (a)(ii) of this Regulation shall make such payment by 5:00
p.m. of the next business day following the day upon which payment
was due from the exchanging member. Upon such payment, the clearing
member shall be the owner of the title and value of the replacement
membership. The clearing member shall either sell or transfer the
replacement membership or cause the replacement membership to be
registered on its behalf in accordance with Rule 230.00 of these
Rules and Regulations. The clearing member shall account to the
exchanging member for the portion of the replacement membership bid
price paid from the proceeds from the sale of the relinquished
membership.
Failure to fulfill the obligations set forth in said agreement shall
constitute acts detrimental to the interest and welfare of the
Association.
(viii) The person who purchases the relinquished membership from the
Association and the person who sells the replacement membership to
the Association shall follow the procedures specified in section (a)
or (b) of this regulation as applicable. Exchanges under this section
(g), except as provided herein, shall be governed by the provisions
of this Chapter.
(h) Direct Exchange of Memberships -
(i) A member in good standing may transfer (1) an associate membership in
direct exchange for a full membership of another member, (2) a full
membership for an associate membership of another member, (3) a GIM
membership interest for an associate membership of another member,
(4) a GIM membership interest for a full membership of another
member, (5) a COM membership interest for an associate membership of
another member, (6) a COM membership interest for a full membership
of another member, (7) an IDEM membership interest for an associate
membership of another member, or (8) an IDEM membership interest for
a full membership of another member. The exchanging members shall
jointly execute and deliver to the Department of Member Services an
agreement of direct exchange in such form as may be prescribed by the
Exchange and setting forth the agreed Price Differential between the
memberships. The agreement shall be accompanied by (1) a check
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from each member in the amount of the applicable transfer fee, (2) a
certified or cashier's check for the Price Differential, and (3) for
each member, an agreement of a clearing member of the Association to
pay to the Association in cash upon demand the amount of any
assessments or claims against the exchanging member's relinquished
membership according to Rule 252.00 up to the value of the
relinquished membership at the time the exchange is accepted. For
this purpose, the value of the relinquished membership shall be the
average of the posted bid and offer prices for such memberships;
provided that if there is either no posted bid or no posted offer,
the value shall be the price paid in the last sale of such
memberships. Title and value of the memberships shall be transferred
to the respective exchanging members upon notification from the
Department of Member Services that it has accepted the exchange.
(ii) Exchanges under this section (h), except as provided herein, shall be
governed by the provisions of this Chapter.
(i) Transfer to a Trust -
(i) A member or membership interest holder (collectively referred to as
"member" under this section) or a member's personal representative
(including his or her agent under a durable power of attorney) may
transfer his or her membership(s) or membership interest(s) to a
trust of which the member is a grantor, if: (1) while the member is
living and competent, the member is the sole trustee of the trust,
(2) the member retains the right to revoke the trust during his or
her life, and (3) all beneficiaries of the trust are members of the
grantor's family who would be eligible for a family transfer from the
grantor pursuant to section (d) of this regulation.
(ii) A trust shall take the membership subject to all of the rules of the
Exchange, including Rules 230.00 and 252.00; however, Rule 252.00
shall not apply to the transfer of a membership or membership
interest to a trust wherein the member/grantor is the trustee. The
transfer of a GIM membership interest to a trust wherein the
member/grantor is the trustee shall not constitute a transfer under
Rule 296.00(1).
(iii) The interests in the membership that inure to the beneficiaries of
the trust shall be subject to all of the rules of the Exchange; the
Exchange's rights with respect to the membership shall be superior to
those of the beneficiaries; and the Exchange shall have no liability
to the beneficiaries of the trust in the event of the mishandling of
the trust assets by the trustee. The grantor and the trustee (and any
successor) shall each provide in the form provided by the Exchange an
acknowledgement that the trust takes the membership subject to all of
the rules of the Exchange and that the trust is in compliance with
the requirements of this regulation.
(iv) The trustee (and any successor), if not already a member, shall be
required to qualify for membership and satisfy the requirements of
Chapter 2 of these Rules and Regulations.
(v) The grantor's liability to the Exchange under Rule 209.00 shall
continue with respect to any claim arising out of an act or omission
occurring prior to such transfer, and the membership will continue to
be treated as the asset of the grantor for the purposes of Rule
209.00 and for otherwise meeting any obligations to the Exchange
arising out of the grantor's use of the membership prior to the
transfer to the trust, including fines imposed with respect to
conduct occurring prior to the transfer.
A membership or membership interest held in a trust of which the
member/grantor is the sole trustee may be temporarily transferred,
subject to the provisions of section (j) of this regulation, to an
individual within the member/grantor's same family, as defined in
section (d)(I) of this regulation.
(vi) A membership held in trust may not be registered for member firm
privileges.
(vii) Subparagraph (vi) shall not apply to self-owned registered
memberships, provided that the member demonstrates, to the
satisfaction of the Association and before the membership is placed
in trust, that the declaration of the trust into which the membership
will be transferred incorporates by express reference the Rules and
Regulations of the Association.
This subparagraph shall have no effect on the provision of Regulation
249.01(j)(iv) that prohibits the use of a membership that is the
subject of a revocable intra-family transfer for
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member firm privileges.
(viii) The transfer shall be revoked and the membership shall revert to
the transferor upon official notice to the Exchange that the trust
has been revoked.
(j) Notwithstanding the provisions of section (d) of this regulation pertaining
to permanent family transfers, a member or membership interest holder may
temporarily transfer his or her respective membership or membership
interest to a member of his or her immediate family, as defined in section
(d)(i) of this regulation, who shall be subject to all Exchange Rules and
Regulations.
Transfers under this section shall be subject to the following terms and
conditions:
(i) The transferor may revoke the transfer upon written notice to the
transferee, and a copy thereof shall be filed by the transferor with
the Member Services Department as a precondition to its
effectiveness. The transferee shall remain approved for membership
under the same conditions which are applicable in the event of a
termination of a delegation agreement, as set forth in Rule
221.00(a).
(ii) The transfer shall be revoked and the membership or membership
interest shall revert to the transferor's estate or conservator upon
official notice of the death or formally declared incompetence of
the transferor.
(iii) Upon election to membership, the transferee shall be treated as a
member for all purposes, except that the transferee shall have no
authority to sell, transfer or assign the membership or membership
interest. The right to vote on all matters subject to a ballot vote
among the general membership will remain with the transferor. A Full
or Associate Member shall not be ineligible for elective office or
committee appointments based on such member's having temporarily
transferred his or her Full or Associate Membership pursuant to this
section (j).
(iv) While a transfer under this section is in effect, the membership
involved would not qualify the transferee for elective office and
the membership may not be registered under Rule 230.00 for member
firm privileges.
(v) The provisions of Rule 221.00(c) shall apply to the transferor and
the transferee in the same manner that those provisions apply to a
member and his delegate.
(vi) The transferor may sell or transfer the membership at any time in
accordance with the provisions of this regulation. The family
transfer shall automatically be null and void upon such a sale or
transfer by the transferor. The proceeds of the sale of the
membership will be distributed to the transferor following the
settlement of all claims pursuant to Rule 252.00
(vii) The transfer of a GIM membership interest under this section shall
not constitute a transfer under Rule 296.00(1).
(viii) In the case of a membership or membership interest held in trust
pursuant to subsection (i), the trustee may transfer the membership
or membership interest in accordance with the provisions of this
subparagraph (j). The trustee shall have the rights, duties and
obligations of a transferor as provided by this subsection (subject
to the provisions of subsection (i)). Where the transferor is the
trustee of a membership or membership interest held in trust
pursuant to subsection (i), and either (1) the trustee revokes the
transfer; (2) the settlor is officially declared dead or (3) the
settlor is decreed to be legally incompetent by a court of proper
jurisdiction, then the membership or membership interest shall
automatically revert to the trustee. (08/01/00)
250.01 Sale and Transfer of Membership Privileges - A member or his legal
representative desiring to sell his membership or membership interest shall
deliver to the Department of Member Services a signed authorization of sale
which is notarized or otherwise officially authenticated, or a telecopy thereof,
in the form prescribed below. The authorization of sale shall contain a specific
offer price. The member must also deliver to the Department of Member Services a
signed consent to jurisdiction in a form prescribed by the Exchange before his
authorization of sale will be accepted. With respect to the sale of a firm-owned
membership, the consent to jurisdiction must be signed by the last member
holding the membership and, if the sale would terminate the firm's member firm
status, a consent to jurisdiction must also be executed on behalf of the firm.
The consent to jurisdiction form provides that the member and, if applicable,
the member firm, consents to and accepts the
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Association's jurisdiction with respect to any potential or current disciplinary
matter of which the Association is aware or becomes aware prior to the
distribution of proceeds and further that the Exchange may retain all of the
proceeds from the sale of the member's seat pending the outcome of any
disciplinary action. The following shall apply to persons elected to membership
and to registered member firms for a period of five years after the termination
of such individual's or firm's membership status. Each such individual and firm:
- Remains responsible for any violations of Exchange rules and regulations
committed while a member or member firm; and
- Agrees to have any disputes which arose while a member or member firm
and which relate to or arose out of any transaction upon the Exchange or
membership in the Exchange, resolved in accordance with Exchange rules
and regulations.
An individual wishing to purchase a membership or membership interest shall
inform the Department of Member Services in such form as shall be prescribed by
the Exchange of his desire to purchase a membership or membership interest. When
the purchaser's bid has been matched with an offer to sell, the purchaser shall
sign a confirmation of purchase and shall by 5:00 p.m. of the next business day
following the day on which he was notified by the Department of Member Services
that his bid was matched to an offer deposit with the Department of Member
Services the balance, if any, owing on the purchase price on the membership or
membership interest.
AUTHORIZATION OF SALE
To the Department of Member Services, __________________20_____
Board of Trade of the City of Chicago
I hereby offer to sell my membership privilege on the Board of Trade of the
City of Chicago for the sum of $__________to any purchaser, and I authorize
you to transfer my membership privilege to such purchaser upon his deposit
of said purchase price with you and his payment of the transfer fee, it
being understood that I shall pay all assessments up to the end of the
quarter in which my membership is thus transferred. I have this date
knowingly entered the date and offer price set forth above.
---Please check here if this offer revises and replaces a previous offer to
sell your membership privilege.
I ACKNOWLEDGE THAT I AM PERSONALLY LIABLE FOR ANY DAMAGES THAT MAY RESULT IF
THIS OFFER REVISES AND REPLACES A PREVIOUS OFFER AND I FAIL TO NOTE THIS BY
CHECKING THE SPACE INDICATED ABOVE.
---------------------------------------
Social Security Number_________________
Subscribed and sworn to before me on this ________Day of__________________,
20________________
______________________________________________
Notary Public
CONFIRMATION OF PURCHASE
Mr._______________________ _________________________,20______
I hereby confirm my purchase of your membership privilege on the Board of
Trade of the City of Chicago in accordance with Regulations 243.01 and
250.01 for the sum of $__________, it being understood that I have paid to
the Board of Trade of the City of Chicago the transfer fee of $__________.
_________________________________________
Signed in the presence of
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
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_________________________________________
(01/01/00)
250.02 Memberships Held Under Regulation 249.01(b) - The title and value of a
membership procured under Regulation 249.01(b) is owned by the registered
eligible business organization acquiring it, but the personal privileges of that
membership can only be exercised by one of the registered firm's managerial
employees who has been approved by the Membership Committee. For that reason,
the registered firm is allowed to designate a qualified individual to exercise
the personal privileges of that membership. Any such designation can be
terminated by the registered firm at any time. In that event, the individual's
right to exercise the personal privileges of that membership terminates
immediately and automatically. In the event that an individual wrongfully
exercises any personal privilege of membership after termination, the registered
firm shall remain responsible for that individual's liabilities and actions
until written notice of the termination has been posted on the bulletin board.
1806 (04/01/98)
250.03 Power-of-Attorney - In connection with membership transfers and
delegations, a power-of- attorney is permitted to be used only for the following
functions;
1. To submit a bid to purchase a membership or membership interest.
2. To sign the membership register.
3. To execute, amend, terminate or file a delegation agreement. (08/01/94)
251.00 Membership Transfer - All purchases or sales of membership privileges
shall be made pursuant to Regulations adopted by the Exchange and no commission
or other compensation for services in connection with the purchase or sale of a
membership in the Association shall be paid. 127 (08/01/94)
251.01 Member Under Investigation - No member may transfer his membership
privilege by intrafamily transfer and no member firm may transfer a firm-owned
membership from one member employee to another employee under Regulation
249.01(b), unless the approval of the Regulatory Compliance Committee is first
secured, when the member is under investigation by any standing committee or by
a special committee appointed under the provisions of Rule 541.00 or when
charges are preferred against him or when he is under suspension for causes
other than default, insolvency, or non-payment of assessments. 1835 (08/01/94)
252.00 Proceeds of Membership -
(a) ORDER OF DISTRIBUTION. Upon any transfer of membership, whether made by a
member voluntarily or by the Board, the proceeds shall be applied to the
following purposes and in the following order of priority:
(1) FIRST, the payment of all dues, assessments, service fees, fines,
contributions, and charges payable to the Association by the member
whose membership is transferred, and all other indebtedness of such
member to the Association.
(2) SECOND, the payment of all dues, assessments, fines and charges payable
by such member to the Clearing House, and all other indebtedness of such
member to the Clearing House.
(3) THIRD, the payment to such member's Primary Clearing Member or Members,
as specified in Rule 333.00, of all claims filed under Rule 253.00 for
trading losses of such member arising out of Transactions on Change, and
which claims have been allowed by the Board.
(4) FOURTH, the payment to other Clearing Members of all claims filed under
Rule 253.00 for trading losses of such member arising out of
Transactions on Change, and which claims have been allowed by the Board.
(5) FIFTH, the payment to members and member firms of all claims filed under
Rule 253.00 for money owed on loans which had been made to the member
whose membership was transferred, exclusively for the purpose of
financing the purchase of such membership, and
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which had been promptly recorded with the Secretary of the Association,
and which claims have been allowed by the Board.
(6) SIXTH, the payment to members and member firms of all claims filed under
Rule 253.00 otherwise arising from Member's Contracts, exclusive of
personal debts which are not related to the conduct of business as a
broker, trader or commission merchant, and which claims have been
allowed by the Board. Provided, however, that this provision shall not
apply to a membership subject to Regulation 249.01(b) or 249.01(c).
(b) PRO RATA PAYMENT. If the proceeds of a transfer of membership are
insufficient to pay all filed claims allowed by the Board, such claims,
within the priorities listed in (a) above, shall be paid pro rata, except as
provided in (e) below.
(c) SURPLUS, IF ANY. Claims which are not filed during the period specified in
Regulation 249.01 but which would otherwise qualify under (a) above may, if
allowed by the Board, be paid out of any surplus after all other claims
allowed by the Board have been paid in full and shall be paid in preference
to claims referred to in (e) below. The remaining surplus, if any, of the
proceeds of a transfer of membership, after payment of all claims allowed by
the Board under this Rule, shall be paid to the person whose membership is
transferred, or to his legal representatives, upon the execution by him or
them of a release or releases satisfactory to the Board.
(d) VALUATION.
(1) Claims which have not matured at the time of the transfer of the
membership may be treated as though they had matured, and the amount due
may be fixed and determined by the Board on the basis of market values
or such other basis as the Board deems to be fair and just.
(2) If a claim is contingent or the amount that will ultimately be due
cannot be immediately ascertained and determined, the Board may reserve
and retain such amount from the proceeds as it deems appropriate,
pending determination of the amount due on the claim.
(3) A claim shall be allowed by the Board only for the amount due after
credit is given for the proceeds of the sale of any collateral held by
the claimant of the fair value of such collateral as determined by the
Board, The Board may require, before passing on the claim, that all such
collateral be sold.
(e) CLAIMS OF PARTNERS. Claims growing out of transactions between partners, who
are members of the Association, shall not share in the proceeds of the
membership of one of such partners until all other claims as allowed by the
Board have been paid in full.
(f) RIGHTS OF CREDITORS OF DECEASED, INCOMPETENT, SUSPENDED, OR EXPELLED MEMBER.
The death, incompetency, expulsion or suspension of a member shall not
affect the right of creditors under the provisions of this Rule.
(g) DEATH OR INCOMPETENCY OF CREDITOR MEMBERS. When a member is in debt to
another member, the death or incompetency of the creditor member or the
transfer of his membership either by his estate or by the Board, shall not
affect the rights of the creditor member, his firm, corporation, or estate,
to share in proceeds of the membership of the debtor member under this Rule,
in the same manner and to the same extent as if the creditor member had not
died, become incompetent or his membership had not been transferred.
(h) DEBTS EXISTING AS OF THE EFFECTIVE DATE OF THIS RULE AS AMENDED. Within 20
business days after the effective date of this Rule, as amended, all members
and member firms shall notify the Secretary of the Association of all member
debts outstanding as of the effective date which debts have arisen out of
members' contracts had between the parties thereto in the ordinary course of
business. The Secretary shall record such debts. All recorded debts still
remaining unpaid at the time of the transfer of the debtor's membership, if
allowed by the Board, shall be included in Category 3 of this Rule to be
paid pro rata if necessary along with claims under that category, provided
such debts are determined by the Board to have arisen out of members
contracts had between the parties thereto in the ordinary course of
business. The notice to the Secretary shall include the debtor member's
acknowledgment of the debt; provided, however, that
Ch2 Purchase and Sale or Transfer of Membership or Membership Interest
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any contested debts will be provisionally recorded by the Secretary.
(08/01/94)
252.00A Claims Filed by Corporations - Your Rules and Claims and Insolvencies
Committees concur in the attorney's opinion that a corporation cannot share in
the proceeds of the sale of memberships against which the corporation has filed
claims (even claims filed prior to the cancellation of the registration of its
officer's membership) after the member has cancelled the registration of his
membership for the benefit of the corporation, leaving no other member
registered for the corporation. 3R (08/01/94)
252.00B Interpretation of Rule 252(e) - The Rules Committee has interpreted
Rule 252(e) as follows:
Where a partnership is the primary or other clearing member for one of its
member partners, such partnership may make claims against the proceeds from the
sale of such partner's membership under the provisions of Rule 252.00(a) (3) or
(4) for trading losses. A partnership may make claims against the proceeds from
the sale of a partner's membership under Rule 252.00(a) (5) where such loan had
been made exclusively for the purpose of financing the purchase of the partner's
membership. (08/01/94)
253.00 Filing Claims - A member to establish his claim and to become entitled
to his rights under Rule 252.00 of this Chapter to share in the proceeds of a
membership, shall file a statement of his claim during the period specified in
Regulation 249.01. Claims if not so filed and allowed by the Board may be paid
out of any surplus after all claims allowed by the Board have been paid in full
and shall be paid in preference to claims referred to in Rule 252.00(e) of this
chapter. 113 (08/01/94)
253.01 Pending Arbitration - In the event an Exchange arbitration action is
pending against a member who sells his membership, the entire proceeds from such
membership sale shall be reserved and retained by the Exchange towards
satisfaction of any resulting arbitration award in accordance with Rule 252.00.
However, prior to the arbitration hearing, a selling member whose sale proceeds
are being held by the Exchange pending the outcome of an arbitration may make
application to the Executive Committee who, upon such application, shall have
the discretion to authorize release to the selling member of any of the proceeds
in excess of the amount claimed in the arbitration and claims filed pursuant to
Rule 252.00. (08/01/94)
255.00 Deceased or Incompetent Member - When a member dies, or when a
conservator is appointed for him or his estate, his membership may be disposed
of by the Board. If the deceased or incompetent member has neglected to pay
assessments, Rule 242.00 shall apply to the disposition of his membership by the
Board. 115 (08/01/94)
256.00 Expelled Member - When a member is expelled or becomes ineligible for
reinstatement, his membership may be disposed of forthwith by the Board. 116
(08/01/94)
Ch2 Insolvency
270.00 Insolvency - A member, or any other person with trading privileges,
who fails to perform his contracts, is insolvent, or is the subject of petition
for bankruptcy, or whose membership is registered for a member firm which fails
to perform its contracts, is insolvent, or is the subject of a petition for
bankruptcy, shall immediately inform the Secretary in writing that he or his
firm or corporation is unable to meet his or its engagements, and prompt notice
thereof shall be given to the Association. Subject to the provisions of
Regulation 540.06, he shall thereby become suspended from membership until,
after having settled with his creditors or the creditors of his firm or
corporation, he has been reinstated by the Board.
If a clearing member firm learns that any of the above-specified conditions
apply to a member or member firm whose trades it clears, the clearing member
firm must also immediately provide written notice thereof to the Secretary, and
prompt notice thereof shall be given to the Association. For purposes of this
provision, a clearing member firm will be deemed to have learned of such
conditions, if a member who is registered for the firm, and is also a general
partner of a partnership, an officer or director of a corporation, or a manager
of a limited liability company, has actual knowledge thereof.
Nothing in this Rule shall preclude disciplinary action for the violation of any
Rule or Regulation of the Association which contributed to the condition for
which the person is suspended under this Rule. (06/1/00)
270.01 Restrictions on Operations - The Financial Compliance Committee shall
advise the Chairman or Acting Chairman of the Board whenever it appears that a
member, registered eligible business organization, wholly-owned affiliate of
such member or registered eligible business organization or any other person
with trading privileges is insolvent; is failing to meet the minimum capital
requirements of the Association and cannot demonstrate its ability to achieve
compliance; is in such financial condition that it cannot be permitted to
continue in business with safety to its customers, its creditors, or the
Association; or such other condition or practice exists which may adversely
affect the safety of funds or positions carried for others. Upon the receipt of
such advice, the Chairman or Acting Chairman may, subject to the provisions of
Regulation 540.06, impose any restriction upon the operations of a member,
registered eligible business organization, wholly-owned affiliate or any other
person with trading privileges as he deems appropriate in the circumstances,
including but not limited to the following:
(a) Restrictions upon the solicitation and or acceptances of new positions or
new accounts;
(b) In the case of positions or funds not otherwise protected by law which are
carried for the benefit of others, restrictions upon the uses to which such
positions or funds may be applied, and
(c) Restrictions upon the carrying of funds or positions of others on an
omnibus account basis.
Any member, registered eligible business organization, their wholly-owned
affiliates, or persons with trading privileges failing or refusing to comply
promptly with a restriction imposed by the Chairman shall be fined, suspended,
or expelled by the Board.
Nothing in this Regulation shall preclude disciplinary action for the violation
or any Rule or Regulation of the Association which contributed to the condition
for which restrictions are imposed under this Regulation. 1794 (04/01/98)
270.02 Procedures for Member Responsibility Actions - (See 540.06) (08/01/94)
270.03 Finality of Disciplinary Decisions and Member Responsibility Actions -
(See 540.07) (08/01/94)
271.00 Announcement of Suspension - Whenever a member, registered eligible
business organization or any other person with trading privileges has been
suspended pursuant to Regulation 540.06, the Secretary shall immediately
announce to the Association the suspension of such member, eligible business
organization, or other person. If such suspension is modified or rescinded after
hearing, the Secretary shall announce the revised action to the membership. 120
(04/01/98)
272.00 Insolvent Member - When announcement is made of a suspension of a
member, firm or
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corporation pursuant to the Rules and Regulations, members have Exchange
contracts with the member, firm or corporation may proceed to close the same on
the Exchange or in the best available market, except insofar as the By-Laws and
Resolutions of the Clearing House are applicable and provide the method of
closing. Should a contract not be closed, as above provided, the price of
settlement shall be fixed by the Regulatory Compliance Committee.
Such suspended member, firm or corporation shall upon request of any customer
immediately arrange for the transfer of each open position of such customer to
such other person, firm or corporation as such customer may designate. 121
(08/01/94)
272.01 Bankruptcy of a Member or Non-Member - Whenever an order for relief
under the Bankruptcy Code as defined in Regulation 272.02 is entered for a
member, firm or corporation, or for a non-member, members having Exchange
contracts with the bankrupt member or non-member may proceed to close the same
on the Exchange in accordance with the provisions of Rule 272.00. (08/01/94)
272.02 Deliveries in Bankruptcy Situation -
(a) For purposes of this Regulation:
(i) The term "customer" shall mean any person for whom a member carries an
Exchange futures contract except a non-public customer as that term is
defined in CFTC Regulation 190.01(bb).
(ii) The term "debtor" shall mean any member with respect to which an order
for relief is entered under the Bankruptcy Code.
(iii) The term "order of relief " means the filling of a petition in
bankruptcy in a voluntary case and the adjudication of bankruptcy in
an involuntary case.
(iv) The term "tender" with respect to a notice of delivery shall mean, in
the case of a short clearing member that has presented such a notice
to the Clearing House, the assignment of such notice by the Clearing
House to a long clearing member, and, in the case of a long clearing
member, the acceptance by such member of such notice from the Clearing
House if such notice is not transferred by such long clearing member
within the time permitted under the Rules of the Association or the
Clearing House.
(b) This Regulation shall apply only in the event and under the circumstances
set forth in paragraph (c) hereof, and only in the event that the opposite
clearing member referred to in said paragraph (c) is not itself a debtor.
(c) Any provisions of the Rules or the Clearing House Rules to the contrary
notwithstanding, in the event that any member becomes a debtor, and that at
that time such member carries for a customer any Exchange futures contract
in the current delivery month with respect to which the underlying physical
commodity has not become a part of the debtor's estate on the date of the
entry of the order for relief, and with respect to which:
(i) trading has ceased on the date of the entry of the order for relief;
or (ii) notice of delivery has been tendered on or before the date of
the entry of the order for relief; or
(iii) trading ceases before such futures contract can be liquidated by the
trustee of the debtor's estate;
then, any customer for whose account such member is holding any such futures
contract shall make delivery of and receive payment for, or receive delivery
of and make payment for, the physical commodity as required to fulfill such
contract directly between the customer and the opposite clearing member
identified by the Clearing House as the party to whom delivery should be
made or from whom delivery should be taken by such customer, through and in
accordance with the bylaws of the Clearing House, and such opposite clearing
member shall receive delivery of and make payment for, or make delivery of
and receive payment for, such commodity in accordance with the bylaws of the
Clearing House; provided, however, that nothing contained herein shall
prevent such customer and such opposite clearing member from settling any
such contract on such terms as may be mutually agreed upon.
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(d) The making or taking of delivery or payment with respect to any futures
contract in accordance with paragraph (c) shall discharge in full the
obligations of such customer and such opposite clearing member to the debtor
and to every other person with respect thereto, but shall not discharge the
debtor from any of its obligations with respect to such contract except to
the extent that such delivery or payment is made.
(e) Nothing contained in this Regulation shall relieve any customer of its
obligation to make or take delivery under any Exchange futures contract for
the sole reason that delivery must be made to or taken from a commodity
broker which is a debtor. (08/01/94)
273.00 Investigation - Every person suspended under the provisions of Rule
270.00 shall immediately afford every facility required by the Office of
Investigations and Audits for the investigation of his affairs, and shall, after
the announcement of his suspension, file with the Office of Investigations and
Audits a written statement covering all information required by the Office of
Investigations and Audits, including a complete list of his creditors and amount
owing to each. 122 (08/01/94)
273.01 Insolvency - When the Financial Compliance Committee from any
preliminary investigations or otherwise, has reason to suspect that any member
of the Association is threatened with insolvency, it shall co-operate with such
member, in any feasible manner not contrary to the Rules and Regulations of the
Association, to save such member from open and judicial bankruptcy. When this is
not practicable, the Committee shall then take such other action as will in its
judgment assist in securing a prompt, efficient, and economic administration of
the member's assets for the bankrupt, as well as for the members of the
Association and customers of such bankrupt, who are creditors. Nothing herein,
however, shall authorize such Committee to bind the Association to any pecuniary
obligation. 1815 (08/01/94)
274.00 Reinstatement - When a person suspended under the provisions of this
Chapter applies for reinstatement, notice thereof shall be given by the
Secretary to the members of the Association, by notifying each member of such
application directly and by posting notice upon the bulletin board at least
fifteen days prior to the consideration by the Board of such application. The
applicant shall furnish to said Board the list of his creditors, a statement of
the amounts originally owing and the nature of the settlement in each case. The
application shall be heard in accordance with Regulation 540.03.
If the applicant fails to receive the approving vote of two-thirds of the
members of the Board present, the applicant shall be entitled to be balloted for
at two subsequent regular meetings of the Board to be designated by himself;
provided, however, that the three ballots to which the applicant shall be
entitled, shall be within six months from the date of his suspension, or until
such time as the membership is sold, or within such further extended time for
settlement as may have been granted by the Board. 124 (08/01/94)
275.00 Suspended or Expelled Member Deprived of Privileges - (See 561.00)
(08/01/94)
276.00 Suspended Member-Time for Settlement - If a person suspended under the
provisions of this Chapter fails to settle with his creditors and fails to apply
for reinstatement within (30) thirty days from the date of his suspension, or
within such further time as the Board may grant, or fails to obtain
reinstatement as elsewhere herein provided, his membership may be disposed of by
the Board.
The Board may, by a two-thirds vote of the members present, extend the time of
settlement for periods not exceeding one year each. 123 (06/01/99)
277.00 Discipline During Suspension - (See 562.00) (08/01/94)
278.00 Suspension for Default - Where a member, or any other person with
trading privileges, fails or refuses to (a) perform an Exchange contract with
(b) pay obligations arising out of such contracts to another member, or (c) pay
obligations owed to the Association, the defaulting member, on complaint of the
other member or, in the case of a debt owed to the Association, of the Treasurer
of the Association, shall, subject to the provisions of Regulation 540.06, be
suspended until the contract is performed or the debt satisfied. Registered
firms and corporations shall be deemed members under this Rule. Application for
reinstatement shall allege, under oath, that all such debts have been
discharged, and notice of such application shall be posted on the bulletin board
fifteen days prior to the hearing of such application pursuant to Rule 274.00.
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Nothing in this Rule shall preclude disciplinary action for the violation of any
Rule or Regulation of the Association which contributed to the condition for
which the member is suspended under this Rule. 130 (12/01/96)
278.01 Arbitration of Default - If the member alleged to be in default
pursuant to Rule 278.00 denies the default, he shall be entitled to have the
claim arbitrated. If the claim is admitted or established by a final arbitration
award, the defaulting member shall be suspended until he has satisfied and
discharged the debts owing to members on Exchange contracts. (08/01/94)
285.01 Financial Questionnaire - Each member, registered eligible business
organization or wholly-owned affiliate of such member or registered eligible
business organization shall furnish to the Business Conduct Committee or the
Financial Compliance Committee, at such times as the Committee may designate, an
answer to a financial questionnaire in such form as the Committee may prescribe.
1781 (04/01/98)
285.02 Audits - The Business Conduct or Financial Compliance Committee may
require any member, registered eligible business organization or its wholly-
owned affiliates carrying margin accounts for customers or transacting business
involving the purchase and sale of cash commodities for customers, to cause to
be made as of the date of an answer to a financial questionnaire, an audit of
his or its assets, liabilities, accounts and affairs, including securities held
for safekeeping, in accordance with such audit requirements as may be prescribed
by said Committee, and to file with said Committee a statement to the effect
that such an audit has been made and that the answers to the questionnaire are
in accord therewith.
Such statement shall in the case of any such member of the Association not a
partner of a registered partnership, a manager of a registered limited liability
company, nor an officer of a registered corporation, be signed by such member.
In the case of a registered partnership, such statement shall be signed by two
general partners of the partnership, one of whom must be a member of the
Association. In the case of a registered corporation, such statement shall be
signed by at least two of the bona fide, active executive officers of the
corporation, one of whom must be a member of the Association whose membership is
registered on behalf of the corporation. In the case of a registered limited
liability company, such statement shall be signed by at least two managers of
the limited liability company, one of whom must be a member of the Association
whose membership is registered on behalf of the limited liability company. In
the case of a wholly-owned affiliate of a member, registered partnership,
registered limited liability company or registered corporation, such statement
must be signed as indicated above, as well as by an active executive officer of
the wholly-owned affiliate. The statement must also certify that a copy of it
has been made available to each general partner in the case of partnerships, to
each of the members of a limited liability company and in the case of
corporations each member of the Association whose membership is registered on
behalf of the corporation.
The signature of a partner of such partnership, a member of such limited
liability company or an officer of such corporation, may be waived by the
Committee at the discretion of the Committee.
Such above statement shall in all cases be attested to by the auditors and a
copy of the report of the audit signed by the auditors shall be retained as part
of the books and records of the member, registered partnership or registered
corporation. 1782 (04/01/98)
285.03 Notification of Capital Reductions - Any non-FCM member firm or firm
that has been approved to deliver against a CBOT contract or wholly-owned
affiliate of such for which the Financial Compliance Committee has established
capital requirements under the provisions of Rule 551.00 (f) must:
Notify the Exchange in writing within two business days of any event or
series of events, including any withdrawal, advance, loan or loss that, on
a net basis, causes a twenty percent (20%) or more reduction of his or its
Net Worth as last reported by submission of a financial statement or
financial questionaire. Failure to so notify the Financial Compliance
Committee shall be considered an act detrimental to the interest and
welfare of the Association under Rule 504.00. (04/01/97)
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285.04 Restrictions on Operations - (See 270.01) (08/01/94)
285.05 Financial Requirements -
A. All member firms that are registered as Futures Commission Merchants must
comply with the requirements set forth in the following CFTC Regulations:
1. 1.10 - Financial reports of futures commission merchants; and
a. In addition to the requirements set forth in CFTC Regulation 1.10
each FCM member firm must file:
1. An unaudited quarterly financial statement as of the firm's
fiscal year end; and
2. Submit with the certified year-end financial report a
reconciliation between the certified financial report and the
quarterly unaudited report; and
3. For all financial statement filings, submit a Statement of
Income (Loss) for the period between the date of the most recent
financial statement or, at the option of the member, the most
recent certified financial statement filed with the Exchange;
and
4. Each member FCM which also is a member of any other security or
commodity exchange or self-regulatory organization or federal
agency must promptly submit to the Exchange, unless specifically
exempted, copies of any financial statements (for example, Focus
Reports) submitted pursuant to the requirements of those
exchanges, organizations or agencies.
b. Statement Certification and Attestation Requirements:
1. For a member FCM which is a registered partnership, financial
report must be signed in a manner as determined by the Exchange
(i.e. - electronic or manual) by the individual designated as
the Chief Financial Officer (or as having these
responsibilities), in accordance with Chicago Board of Trade
Regulation 230.03(a), provided that he is a general partner.
2. For a member FCM which is any type of eligible business
organization other than a partnership, financial reports must be
signed in a manner as determined by the Exchange (i.e. -
electronic or manual) by the individual designated as the Chief
Financial Officer (or as having these responsibilities) in
accordance with Chicago Board of Trade Regulation 230.03(a).
3. An attestation letter must accompany all audited financial
reports which are filed with the Exchange, as well as any
financial reports which are not filed electronically. The
attestation letter must certify that copies of the financial
reports must be made available to: (a) each member of the
Chicago Board of Trade whose membership is registered for the
FCM: (b) each individual designated by the FCM, in accordance
with Regulation 230.03(a): and (c) each general partner in the
case of a partnership.
4. The signature of the Chief Financial Officer, or the person who
has these responsibilities, may be waived by the Exchange, at
the discretion of the Exchange. In the event of such waiver, an
FCM will be required, in the case of a partnership, to have a
general partner sign the financial reports. In the case of any
other type of eligible business organization, the FCM will be
required to have the Chief Executive Officer sign the financial
reports. In either event, this individual must either be a
member of the Chicago Board of Trade, or must have been
designated by the FCM, in accordance with Regulation 230.03(a).
5. Financial report audited by an independent public accountant
must be attested to by the independent public accountant.
6. Financial reports which are filed through Exchange-approved
electronic transmission must be accompanied by the CBOT assigned
Personal
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Identification Numbers (PINS) of the authorized signers. The PIN
number will constitute and become a substitute for the manual
signature of the authorized signer to the electronically filed
financial report. The PIN is a representation by the authorized
signer that, to the best of his or her knowledge, all
information contained in the statement being transmitted under
the PIN is true, correct and complete.
7. The unauthorized use of a CBOT assigned Personal Identification
Number for electronic attestation by an unauthorized party is
forbidden.
2. 1.12 - Maintenance of minimum financial requirements by futures
commission merchants; and
3. 1.16 - Qualifications and reports of accountants; and
4. 1.17 - Minimum financial requirements for futures commission merchants
and introducing brokers; and
5. 1.18 - Records for and relating to financial reporting and monthly
computation by futures commission merchants; and
6. 1.20 through 1.30 - Customers' Money, Securities, and Property; and
7. 1.32 - Segregated account; daily computation and record; and
8. 30.7 - Treatment of foreign futures or foreign options secured amount.
Notwithstanding the foregoing requirements, the CBOT may impose additional
accounting, reporting, financial and/or operational requirements as
determined necessary.
B. For firms that are regular to deliver agricultural products see Appendix
4E.
C. For firms that are regular to deliver Rough Rice see Appendix 37D.
(07/01/00)
285.07 Member Joint Accounts - No member shall, directly or indirectly, hold
any interest or participate in any joint account for which a member participant
exercises discretionary trading authority and executes trades for buying or
selling any Chicago Board of Trade futures or options contracts unless each
participant in such joint account is a member or member organization and unless
such account is reported to and not disapproved by the Exchange. Such report
shall be in a form prescribed by the Exchange and shall be filed with the
Exchange before any transaction is effected on the Exchange for such joint
account. For the purposes of this regulation, a "joint account" shall mean: (1)
any account which is initially funded by two or more parties, all of whom have
an ongoing obligation to contribute additional funds to the account when
necessary; (2) any account in which two or more parties share a risk of loss of
the capital contributed to that account; and (3) any account where all of the
participants in the account own more than a 5% interest in the account. In
addition, a trading account which is funded via a loan shall be deemed a joint
account unless the terms of the loan demonstrate that it is a bona fide loan
that was made as a part of an arm's length transaction between the borrower and
the lender. (12/01/97)
285.08 Financial Arrangements - Each member who makes an arrangement to
finance his transactions must identify to the Exchange the source of the
financing and its terms. The Exchange must be informed immediately of the
intention of any party to terminate or change any such arrangement. (12/01/94)
285.09 Trading Associations - Each member who makes an arrangement to be on
the floor of the Exchange or on the Project A electronic trading system for the
purpose of making discretionary trading decisions and executing discretionary
trades for a firm must ensure that the firm is registered as a member firm of
the Exchange. (08/01/99)
286.00 Trades of Non-Clearing Members - On the first business day of each
month each clearing member who is creditor of any member as a result of debts
related to the conduct of business as a broker, trader or commission merchant
shall report to the Business Conduct Committee the name of each member whose
unsecured indebtedness to him is in the amount of five thousand dollars ($5,000)
or more. The Business Conduct Committee is authorized to furnish to any clearing
member,
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on written request, the names of all members or member firms, to whom a
specified member is indebted as reported hereunder, and the names of members and
member firms as reported pursuant to Rule 252.00(h).
The phrase "unsecured indebtedness" as used in the rules means the amount of
indebtedness in excess of collateral security valued in accordance with the
provisions of paragraph 3 and 4 of Regulation 431.02.
Failure of a member or member firm to report such indebtedness may be considered
to be an act detrimental to the interest or welfare of the Association under the
provisions of Rule 504.00 and may be relied on by the Board of Directors in
deciding not to allow a claim for such indebtedness under Rules 252.00 and
253.00. (08/01/94)
287.00 Advertising - No member shall publish any advertisement of other than
strictly legitimate business character. 604 (08/01/94)
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290.00 Market Categories - Each existing and prospective futures contract and
options contract traded on the Exchange shall be listed in one of the following
four market categories: Agricultural and Associated Market (AAM), Government
Instruments Market (GIM), Index, Debt and Energy Market (IDEM), and Commodity
Options Market (COM). The Board shall provide for the initial listing of such
futures contracts and options contracts by adopting Regulations and may alter
any such listing by amending these Regulations. No such listing shall affect any
of the rights of full or associate members or other persons with trading access,
except as may be specifically provided for herein. (08/01/94)
290.01 Agricultural and Associated Market (AAM) - The AAM consists of the
following futures contracts: soybeans, soybean meal, soybean oil, oats, wheat,
corn, anhydrous ammonia, diammonium phosphate, barge freight rate index, FOSFA
International Edible Oils Index, sunflower seeds, catastrophe insurance, rough
rice and silver. (11/01/94)
290.02 Government Instruments Market (GIM) - The GIM consists of the
following futures contracts: U.S. Treasury Bonds, U.S. Treasury Notes (6-10
years), U.S. Treasury Notes (5 years), U.S. Treasury Notes (2 years), Long Term
Agency (Fannie Mae(R) Benchmark and Freddie Mac Reference) Notes(SM), Inflation-
Indexed U.S. Treasury Bonds, Long-Term Inflation-Indexed Treasury Notes, Medium-
Term Inflation-Indexed Treasury Notes, German Government Bonds, Canadian
Government Bonds (10 year), Cash Settled U.S. Treasury Notes (2 years), Zero
Coupon Treasury Bonds, Zero Coupon Treasury Notes, U.S. Treasury Bills (90
days), Long-Term Japanese Government Bonds, Mortgage-Backed Futures, GNMA-CDR,
Domestic CDs, and Treasury Repos (30-day and 90-day) (when designated).
(04/01/00)
290.03 Index, Debt and Energy Market (IDEM) - The IDEM consists of the
following futures contracts: 30-Day Fed Fund, Portfolios (when designated),
Stock Indexes, Corporate Bond Index, Commercial Paper (30 days), Commercial
Paper (90 days), Municipal Bonds (when designated), Municipal Bond Index, Cash
Settled Three Year Interest Rate Swaps, Cash Settled Five Year Interest Rate
Swaps, Eurodollars, Crude Oil (when designated), Leaded Gasoline (when
designated), Unleaded Gasoline (when designated), Heating Oil (when designated),
Gold, Gold Coins (when designated) Plywood, Structural Panel Index, CBOT U.S.
Dollar Composite Index, CBOT Argentina, Brazil and Mexico Brady Bond Indexes,
U.S. Treasury Yield Curve Spread, ComEd(TM) and TVA Hub Electricity. (01/01/99)
290.04 Commodity Options Market (COM) - The COM consists of the following
options contracts: U.S. Treasury Bond Futures Options and all other options that
are listed for trading by the Exchange. (08/01/94)
291.00 GIM Membership Interest - A GIM Membership Interest is a personal
right, which shall entitle the holder thereof to trade as principal and broker
for others in all contracts listed in the GIM pursuant to Regulation 290.02. In
addition, the holder of a GIM Membership Interest may communicate from the Floor
of the Exchange with persons not on the Floor of the Exchange in the same manner
as may members, but only with respect to contracts traded in the GIM. An
eligible business organization may own a GIM Membership Interest on behalf of an
individual nominee who is a full-time employee of the eligible business
organization, provided that the Membership Committee determines that such GIM
Membership Interest is needed by the eligible business organization to carry on
its business at the Association and that all rights and obligations of the GIM
Membership Interest shall remain the exclusive responsibility of the individual
nominee. An eligible business organization which owns a GIM Membership Interest
may transfer it from one nominee to another individual employee of the eligible
business organization who has been duly approved for membership subject to the
provisions of Regulation 249.01(b).
(A) A GIM Membership Interest shall not carry any voting rights on any matter
which is the subject of a ballot vote of the general membership.
(B) GIM Membership Interest holders, annually, may elect a Committee consisting
of 11 GIM Membership Interest holders, including a Chairman thereof. The
Chairman of this Committee shall be liaison to the Chairman of the Board.
(C) In the event of full liquidation of the Association, the holder of a GIM
Membership Interest shall
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share in the proceeds from dissolution in an amount equal to eleven percent
(.11) of a full member's share. No holder of a GIM Membership Interest
shall have the right to share in any other distribution made by the
Association.
(D) No GIM Membership Interest shall carry with it the attributes of membership
in the Association under the Fifth Article of the Certificate of
Incorporation of the Chicago Board Options Exchange.(E) Each holder of a
GIM Membership Interest shall be responsible for paying all dues, fees and
assessments that are applicable to full memberships for each GIM Membership
Interest held.
(F) Each GIM Membership Interest may be sold or delegated according to the
Rules and Regulations applicable to the sale and delegation of full and
associate memberships. No GIM Membership Interest may be registered on
behalf of an eligible business organization.
(G) Each person who seeks to purchase or be delegated a GIM Membership Interest
shall make application according to the Rules and Regulations governing
applications for full and associate membership. Each such applicant shall
be considered eligible to assume the rights and obligations of a GIM
Membership Interest according to the procedures and standards that apply to
full and associate members, as set forth in the Rules and Regulations.
(H) Each holder of a GIM Membership Interest shall be subject to all Rules and
Regulations of the Association including all specific duties and obligations
imposed on such holders by the Rules and Regulations, as well as those
duties and obligations imposed upon members or other approved persons under
the Rules and Regulations; provided however, the Board may exempt holders of
GIM Membership Interests from any such duty or obligation which is
incompatible with, or in conflict with or unrelated to the duties performed
by them. All references to "members" and "membership" in the Rules and
Regulations shall apply with equal force to holders of GIM Membership
interest and GIM Membership Interests, respectively, unless superseded or
specifically negated by this Rule or by Rule 290.00 or Rule 294.00 or the
Regulations thereunder. (04/01/98)
292.00 IDEM Membership Interest - An IDEM Membership Interest is a personal
right, which shall entitle the holder thereof to trade as principal and broker
for others in all contracts listed in the IDEM pursuant to Regulation 290.03. In
addition, the holder of an IDEM Membership Interest may communicate from the
Floor of the Exchange with persons not on the Floor of the Exchange in the same
manner as may full members, but only with respect to contracts traded in the
IDEM. An eligible business organization may own an IDEM Membership Interest on
behalf of an individual nominee who is a full-time employee of the eligible
business organization, provided that the Membership Committee determines that
such IDEM Membership Interest is needed by the eligible business organization to
carry on its business at the Association and that all rights and obligations of
the IDEM Membership Interest shall remain the exclusive responsibility of the
individual nominee. An eligible business organization which owns an IDEM
Membership Interest may transfer it from one nominee to another individual
employee of the eligible business organization who has been duly approved for
membership subject to the provisions of Regulation 249.01(b).
(A) An IDEM Membership Interest shall not carry any voting rights on any matter
which is the subject of a ballot vote of the general membership.
(B) IDEM Membership Interest holders, annually, may elect a Committee
consisting of 11 IDEM Membership Interest holders, including a Chairman
thereof. The Chairman of this Committee shall be liaison to the Chairman of
the Board.
(C) In the event of full liquidation of the Association, the holder of an IDEM
Membership Interest shall share in the proceeds from dissolution in an
amount equal to one-half of one percent (.005) of a full member's share. No
holder of an IDEM Membership Interest shall have the right to share in any
other distribution made by the Association.
(D) No IDEM Membership Interest shall carry with it the attributes of
membership in the Association under the Fifth Article of the Certificate of
Incorporation of the Chicago Board Options Exchange.
(E) Each holder of an IDEM Membership Interest shall be responsible for paying
all dues, fees and assessments that are applicable to full memberships for
each IDEM Membership Interest held.
(F) Each IDEM Membership Interest may be sold or delegated according to the
Rules and Regulations
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applicable to the sale and delegation of full and associate memberships. No
IDEM Membership Interest may be registered on behalf of a eligible business
organization.
(G) Each person who seeks to purchase or be delegated an IDEM Membership
Interest shall make application according to the Rules and Regulations
governing applications for full and associate membership. Each such
applicant shall be considered eligible to assume the rights and obligations
of an IDEM Membership Interest according to the procedures and standards
that apply to full and associate members, as set forth in the Rules and
Regulations.
(H) Each holder of a IDEM Membership Interest shall be subject to all Rules and
Regulations of the Association including all specific duties and obligations
imposed on such holders by the Rules and Regulations, as well as those
duties and obligations imposed upon members or other approved persons under
the Rules and Regulations; provided however, the Board may exempt holders of
IDEM Membership Interests from any such duty or obligation which is
incompatible with, or in conflict An eligible business organizationith or
unrelated to the duties performed by them. All references to "members" and
"membership" in the Rules and Regulations shall apply with equal force to
holders of IDEM Membership Interest and IDEM Membership Interests,
respectively, unless superseded or specifically negated by this Rule or by
Rule 290.00 or Rule 294.00 or the Regulations thereunder. (04/01/98)
293.00 COM Membership Interests - A COM Membership Interest is a personal
right, which shall entitle the holder thereof to trade as principal and broker
for others in all contracts listed in the COM pursuant to Regulation 290.04. In
addition, the holder of a COM Membership Interest may communicate from the Floor
of the Exchange with persons not on the Floor of the Exchange in the same manner
as may full members, but only with respect to options contracts traded in the
COM. An eligible business organization may own a COM Membership Interest on
behalf of an individual nominee who is a full-time employee of the eligible
business organization, provided that the Membership Committee determines that
such COM Membership Interest is needed by the eligible business organization to
carry on its business at the Association and that all rights and obligations of
the COM Membership Interest shall remain the exclusive responsibility of the
individual nominee. An eligible business organization which owns a COM
Membership Interest may transfer it from one nominee to another individual
employee of the eligible business organization who has been duly approved for
membership subject to the provisions of Regulation 249.01(b).
(A) A COM Membership Interest shall not carry any voting rights on any matter
which is the subject of a ballot vote of the general membership.
(B) COM Membership Interest holders, annually, may elect a Committee consisting
of 11 COM Membership Interest holders, including a Chairman thereof. The
Chairman of this Committee shall be liaison to the Chairman of the Board.
(C) Upon the inception of options trading on the Exchange, and in the event of
full liquidation of the Association, the holder of a COM Membership
Interest shall share in the proceeds from dissolution in an amount equal to
one-half of one percent (.005) of a full member's share. No holder of a COM
Membership Interest shall have the right to share in any other distribution
made by the Association.
(D) No COM Membership Interest shall carry with it the attributes of membership
in the Association under the Fifth Article of the Certificate of
Incorporation of the Chicago Board Options Exchange.
(E) Each holder of a COM Membership Interest shall be responsible for paying
all dues, fees and assessments that are applicable to full memberships for
each COM Membership Interest held.
(F) Each COM Membership Interest may be sold or delegated according to the
Rules and Regulations applicable to the sale and delegation of full and
associate memberships. No COM Membership Interest may be registered on
behalf of an eligible business organization.
(G) Each person who seeks to purchase or be delegated a COM Membership Interest
shall make application according to the Rules and Regulations governing
applications for full and associate membership. Each such applicant shall
be considered eligible to assume the rights and obligations of a COM
Membership Interest according to the procedures and standards that apply to
full and associate members, as set forth in the Rules and Regulations.
(H) Each holder of a COM Membership Interest shall be subject to all Rules and
Regulations of the
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Association including all specific duties imposed on such holders by the
Rules and Regulations, as well as those duties and obligations imposed upon
members or other approved persons under the Rules and Regulations; provided
however, the Board may exempt holders of COM Membership Interests from any
such duty or obligation which is incompatible with, or in conflict with or
unrelated to the duties performed by them. All references to "members" and
"membership" in the Rules and Regulations shall apply with equal force to
holders of COM Membership Interest and COM Membership Interests,
respectively, unless superseded or specifically negated by this Rule or by
Rule 290.00 or Rule 294.00 or the Regulations thereunder.
(I) Upon the effective date of any termination of commodity options trading by
the Commodity Futures Trading Commission, all rights and privileges
specified in this Rule shall automatically expire and become null and void.
(04/01/98)
293.01 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to transmit orders verbally, by hand signals, or in writing to brokers
in the underlying Treasury Bond futures, Long-Term Municipal Bond Index futures,
Short-Term Treasury Note futures, Medium-Term Treasury Note futures or in Long-
Term Treasury Note futures from the Treasury Bond options trading pit provided
that such orders are for hedge purposes only. (09/01/97)
293.02 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Soybean futures from the
Soybean Options trading pit provided that such orders are for hedge purposes
only. (08/01/94)
293.03 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Corn futures from the Corn
Options trading pit provided that such orders are for hedge purposes only.
(08/01/94)
293.04 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Silver futures from the
Silver Options trading pit provided that such orders are for hedge purposes
only. (08/01/94)
293.05 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to transmit orders verbally, by hand signals, or in writing to brokers
in the underlying Long-Term Treasury Note futures, Long-Term Municipal Bond
Index futures, Medium-Term Treasury Note futures, Short-Term Treasury Note
futures or in U.S. Treasury Bond futures from the Long-Term Treasury Note
Options trading pit provided that such orders are for hedge purposes only.
(09/01/97)
293.06 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to transmit orders verbally, by hand signals, or in writing to brokers
in the underlying Long-Term Municipal Bond Index futures, Long-Term Treasury
Note futures, Medium-Term Treasury Note futures, Short-Term Treasury Note
futures or in U.S. Treasury Bond futures from the Long-Term Municipal Bond Index
Options trading pit provided that such orders are for hedge purposes only.
(09/01/97)
293.07 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Wheat futures from the Wheat
Options trading pit provided that such orders are for hedge purposes only.
(08/01/94)
293.08 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Soybean Meal futures from
the Soybean Meal Options trading pit provided that such orders are for hedge
purposes only. (08/01/94)
293.09 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Soybean Oil futures from the
Soybean Oil Options trading pit provided that such orders are for hedge purposes
only. (08/01/94)
293.10 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to
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transmit orders verbally, by hand signals, or in writing to brokers in the
underlying Short-Term Treasury Note futures, Medium-Term Treasury Note futures,
Long-Term Treasury Note futures, Long-Term Municipal Bond Index futures or in
U.S. Treasury Bond futures from the Short-Term Treasury Note Options trading pit
provided that such orders are for hedge purposes only. (09/01/97)
293.12 IDEM Membership Rights - Holders of IDEM Membership Interests shall be
permitted to transmit orders verbally, by hand signals or in writing to brokers
in U.S. Treasury Bond futures, Long- Term Treasury Note futures, Short-Term
Treasury Note futures, or Medium-Term Treasury Note futures from the Municipal
Bond Index futures pit, provided that such orders are for hedge purposes only.
(08/01/94)
293.14 AM and COM Membership Rights - Holders of Associate Memberships and
COM Membership Interests shall be permitted to transmit orders verbally, by hand
signals, or in writing to brokers in the underlying Oat futures from the Oat
Options trading pit provided that such orders are for hedge purposes only.
(08/01/94)
293.15 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to transmit orders verbally, by hand signals, or in writing to brokers
in the underlying Medium-Term Treasury Note futures, Short-Term Treasury Note
futures, Long-Term Municipal Bond Index futures, Long-Term Treasury Note futures
or in U.S. Treasury Bond futures from the Medium-Term Treasury Note Options
trading pit provided that such orders are for hedge purposes only. (09/01/97)
293.16 IDEM Membership Rights - Holders of IDEM Membership Interests shall be
permitted to transmit orders verbally., by hand signals, in writing, or by any
other means deemed acceptable by the Board to brokers in options on CBOT(R) Dow
Jones Industrial Average(SM) Index futures, from the CBOT(R) Dow Jones
Industrial Average(SM) Index futures trading pit, provided that such orders are
for hedge purposes only. (11/01/97)
293.17 COM Membership Rights - Holders of COM Membership Interests shall be
permitted to transmit orders verbally, by hand signals, in writing, or by any
other means deemed acceptable by the Board to brokers in CBOT(R) Dow Jones
Industrial Average(SM) Index futures, from the CBOT(R) Dow Jones Industrial
Average(SM) Index options trading pit, provided that such orders are for hedge
purposes only. (11/01/97)
294.00 Membership Interest Participations - On April 30, 1982 there shall be
created one thou- sand four hundred and two (1,402) one-quarter participations
each in GIM Membership Interests, IDEM Membership Interests, and COM Membership
Interests. Each full member of the Association as of the close of business on
April 30, 1982 shall be entitled to receive as of May 3, 1982 a one-quarter
participation in a GIM Membership Interest, a one-quarter participation in an
IDEM Membership Interest and a one-quarter participat ion in a COM Membership
Interest for each full membership held by such full member. Further, on April
30, 1982 there shall be created a quantity of one-half participations each in
IDEM Membership Interests and COM Membership Interests equal to the number of
associate memberships that appear on the membership list of the Association as
of the close of business on April 30, 1982. Each associate member of the
Association as of the close of business on April 30, 1982 shall be entitled to
receive as of May 3, 1982 a one-half participation in an IDEM Membership
Interest and a one-half participation in a COM Membership Interest for each
associate membership held by such associate member. (08/01/94)
294.01 Transfer of Membership Interest Participations - One-quarter
participations in GIM Membership Interests, IDEM Membership Interests and COM
Membership Interests, and one-half participations in IDEM Membership Interests
and COM Membership Interests shall be transferable only to and among full,
associate and conditional associate members of the Association; GIM, IDEM and
COM Membership Interest holders; and member firms. Membership Interest
fractional participations may be sold or purchased by authorized individuals or
firms in accordance with the mechanics of the bid/ask market for Membership and
Membership Interests as set forth in Regulation 249.01(a) or may be transferred
intra-family between authorized individuals in accordance with the transfer
procedures set forth in Regulation 249.01(d), including the deposit requirement.
Membership Interest fractional participations may not be sold or transferred in
any other manner. (08/01/94)
294.02 Registration of Membership Interests - Any authorized person or firm
who acquires or accumulates four one-quarter participations in GIM Membership
Interests may surrender to the
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-----------------------
Association such four one-quarter participations for one GIM Membership
Interest, subject to meeting all qualifications required by the Rules and
Regulations relating to membership. Any authorized person or firm who acquires
or accumulates any combination of one-quarter and/or one-half participations in
IDEM Membership Interests that equals one full participation may surrender to
the Association such fractional participations for one IDEM Membership Interest,
subject to meeting all qualifications required by the Rules and Regulations
relating to membership. Any authorized person or firm who acquires or
accumulates any combination of one-quarter and/or one-half participations in COM
Membership Interests that equals one full participation may surrender to the
Association such fractional participations for one COM Membership Interest,
subject to meeting all qualifications required by the Rules and Regulations
relating to membership. Any person or firm who surrenders participations in
accordance with this Regulation shall pay a registration fee as may be
established by the Board. (08/01/94)
294.03 Dues and Assessments on Membership Interest Participations - No
authorized person who holds fractional participations in GIM, IDEM, or COM
Membership Interests shall be responsible for the payment of any dues, fees or
assessments in respect of such fractional participations. (08/01/94)
294.04 Accumulation of Membership and Membership Interest Participations by
the Board - The Board of Directors, in its discretion, may accumulate, pool and
require all outstanding fractional participations in Associate Memberships and
IDEM and COM Membership Interests to be surrendered between April 30, 1989 and
August 31, 1989. All such fractional participations in Associate Memberships and
IDEM and COM Membership Interests so surrendered shall be accumulated into full
Associate Memberships or IDEM or COM Membership Interests respectively and sold
at prevailing market prices to any individuals who are authorized to purchase
such Memberships or Membership Interests under the Rules and Regulations. The
proceeds from the sale of such Associate Memberships and IDEM and COM Membership
Interests shall be distributed pro- rata to those authorized persons
surrendering such fractional participations in Associate Memberships and IDEM
and COM Membership Interests in proportion to the number of such fractional
participations in Associate Memberships and IDEM and COM Membership Interests
respectively surrendered by the authorized person to the total number of such
fractional participations in Associate Memberships and IDEM and COM Membership
Interests respectively surrendered by all authorized persons. (08/01/94)
294.05 Time Limit for Accumulating AM Participations - To implement the
provisions of Rule 294.00, any member or associate member who accumulates one-
quarter AM participations and surrenders them for an associate membership by the
close of business on May 28, 1982 shall be entitled to receive as of June 1,
1982, in respect of each such associate membership, a one-half participation in
an IDEM Membership Interest and a one-half participation in a COM Membership
Interest. A sufficient quantity of such IDEM and COM Membership Interest
participations shall be created on May 28, 1982 to allow any such distribution.
(08/01/94)
294.06 Claims Procedures Regarding Membership Interest Fractional
Participations - Proceeds from the sale of a Membership Interest fractional
participation, and the deposit required for Membership Interest fractional
participations transferred pursuant to Regulations 249.01 (d) and 294.01, shall
be deemed to be subject to the provisions of Rule 252.00. Claims may be filed
against such proceeds in the same manner and subject to the same terms as set
forth in Rule 253.00 and Regulation 249.01 (e) with respect to the filing of
claims against the proceeds of the sale or transfer of a Membership or
Membership Interest. The Secretary shall provide notice of sales or transfers of
Membership Interest fractional participations in the same manner as he provides
notice pursuant to Regulation 249.01(e) of sales or transfers of Memberships and
Membership Interests. (08/01/94)
296.00 Elimination of GIM Membership Interests - Subject to the exceptions
set forth below, on the effective date of this Rule, each existing GIM
Membership Interest shall automatically become a one-half participation in an
Associate Membership; each unaccumulated one-quarter participation in a GIM
Membership Interest shall automatically become a one-eighth participation in an
Associate Membership; and status as a GIM Membership Interest holder or nominee
shall cease respectively for each individual who owns a GIM Membership Interest
or is a nominee of a firm-owned GIM Membership Interest. Fractional
participations in an Associate Membership shall carry no privileges of a
Membership or Membership Interest, including but not limited to trading and
voting privileges.
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-----------------------
(1) With respect to individuals who own GIM Membership Interests, each
individual who (a) applied for approval as a GIM Membership Interest holder
prior to January 21, 1986, and whose application for such approval was
pending as of January 21, 1986 and/or (b) acquired his current GIM
Membership Interest as of January 21, 1986, or pursuant to a bid to purchase
that was listed with the Exchange as of January 21, 1986, may continue as a
GIM Membership Interest holder subject to all the privileges and obligations
such Membership Interest entails. However, each GIM Membership Interest
covered by this exception may only be sold or transferred as a one-half
participation in an Associate Membership. The limitations on transfers of a
GIM Membership Interest described in this Rule 296.00(1) shall not apply
when (i) the transferor is the estate of a deceased membership interest
holder and the transferee is the decedent's spouse and (ii) the GIM
Membership Interest has not already been transferred pursuant to this
sentence.
(2) With respect to nominees of firm-owned GIM Membership Interests, each
nominee who has had his current GIM Membership Interest assigned to him as
of January 21, 1986, may, at the assigning firm's election, continue as a
GIM Membership Interest nominee subject to all the privileges and
obligations such Membership Interest entails. In addition, a firm shall be
permitted to assign any GIM Membership Interest it owns to two consecutive
nominees following the nominee who was assigned such Membership Interest as
of January 21, 1986. However, each firm-owned GIM Membership Interest
covered by this exception may only be sold as a one-half participation in an
Associate Membership.
None of the foregoing shall preclude individuals covered by paragraph (1) or
firms covered by paragraph (2) from treating their GIM Membership Interests as
one-half participations in Associate Memberships and combining them with other
fractional participations in Associate Memberships. (11/01/99)
296.01 Transfer of Associate Membership Participations - In accordance with
the mechanics of the bid/ask market for Memberships and Membership Interests as
set forth in Regulation 249.01(a), member firms and individuals may purchase or
sell one-eighth or one-half participations in Associate Memberships created
pursuant to Rule 296.00 or Regulation 296.03. Individuals may also transfer
Associate Membership fractional participations in accordance with the transfer
procedures set forth in Regulation 249.01(d), including the deposit requirement.
Associate Membership fractional participations may not be sold or transferred in
any other manner. Each individual who acquires a fractional participation in an
Associate Membership but who is not a Full Member, Associate Member, GIM
Membership Interest holder or GIM Membership Interest nominee in good standing
shall apply for election to Associate Membership status under the same
procedures and requirements as are specified in Regulation 249.01(a)(iii) for
purchasers of Associate Memberships, and also shall be subject to the provisions
of Regulation 249.01(a)(iv) and (v). However, any individual whose status as a
GIM Membership Interest holder or nominee automatically ceases pursuant to Rule
296.00 on the effective date of such Rule shall have 60 days thereafter in which
to acquire an Associate Membership and become an Associate Member without
applying for election to Associate Membership status. Any individual required to
apply for Associate Membership status under this regulation and who is elected
to such status must acquire an Associate Membership within 60 days of
notification of such election or within such extension of this period as may be
granted by the Board of Directors. If he is unable to do so, he must, at his
option, either re-apply for Associate Membership status or take all necessary
steps to effect a sale of the Associate Membership fractional participations he
has acquired within 30 days of the end of the period specified in the preceding
sentence. (08/01/94)
296.02 Registration of New Associate Memberships - Any person or firm which
acquires and accumulates any combination of fractional participations in
Associate Memberships that equals one complete Associate Membership may
surrender such fractional participations to the Department of Member Services
for one Associate Membership, subject to meeting all qualifications required by
the Rules and Regulations relating to membership. Any GIM Membership Interest
holder or nominee in good standing who surrenders fractional participations
under this Regulation shall not be required to apply for election to Associate
Membership status. Once two or more fractional participations have been
combined, they may not be separated. (08/01/94)
296.03 Additional Associate Membership Participations or GIM Membership
Interests - The Board of Directors may at any time at its discretion create
additional fractional participations in
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-----------------------
Associate Memberships but only if necessary to facilitate the combination of
existing fractional participations into Associate Memberships. The Board of
Directors may also create new GIM Membership Interests to sell to individuals
who applied for approval as GIM Membership Interest holders prior to January 21,
1986, and/or to individuals whose bids to purchase GIM Membership Interests were
on file with the Association as of January 21, 1986. Such new GIM Membership
Interests shall be created and sold only if, in the judgement of the Board, GIM
Membership Interests are not otherwise available to such individuals through
bona fide purchases in the Exchange's bid/ask market. (08/01/94)
296.04 Waiver of Transfer and Registration Fees - No fees shall be charged
for transfers of fractional participations in Associate Memberships effected
through the Exchange's bid/ask market or for registrations of new Associate
Memberships acquired by accumulation of fractional participations under
Regulation 296.02. (08/01/94)
296.05 Dues and Assessments - Associate Members shall pay full dues, fees and
assessments as provided for by the Association. However, each person or firm who
acquires an Associate Membership by the accumulation and surrender of fractional
participations pursuant to Regulation 296.02 shall be exempted from member dues
assessed on such Associate Membership pursuant to Rule 240.00 for a period of
twelve (12) consecutive calendar quarters beginning with the quarter following
the quarter in which the fractional participations for such Associate Membership
are surrendered. Only the original owner of each newly created Associate
Membership shall be eligible for the dues waiver referenced herein. (08/01/94)
296.06 Claims Procedures Regarding Associate Membership Participations - The
proceeds of Associate Membership fractional participation sales, and the deposit
required for Associate Membership fractional participations transferred pursuant
to Regulations 249.01(d) and 296.01, shall be deemed proceeds of membership for
purposes of Rule 252.00. Claims may be filed against such proceeds in the same
manner and subject to the same terms as set forth in Rule 253.00 and Regulation
249.01(e) with respect to the filing of claims against the proceeds of the sale
or transfer of a membership or membership interest. The Secretary shall provide
notice of sales or transfers of Associate Membership fractional participations
in the same manner as he provides notice pursuant to Regulation 249.01(e) of
sales or transfers of memberships and membership interests.
Interpretation - The Board of Directors adopted the following on April 17, 1990
as a formal rule interpretation which confirms established Exchange practice:
"A person shall achieve Full Membership status (i.e. - Full Membership
voting rights and trading privileges) only through the purchase of a Full
Membership.
The foregoing shall not affect the existing Exchange provisions for the
delegation, member firm transfer, or intra-family transfer of Full Memberships."
(08/01/94)
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Chapter 3
Exchange Floor Operations and Procedures
====================================================================================================================================
Ch3 Exchange Halls.............................................................................................
300.00 Exchange Halls....................................................................................
301.00 Admission to the Floor............................................................................
301.01 Non-Members.......................................................................................
301.02 Guest Badges......................................................................................
301.03 Guests............................................................................................
301.04 Press.............................................................................................
301.05 Floor Clerks......................................................................................
301.05 Floor Clerks......................................................................................
301.07 Floor Clerk-Special Badges........................................................................
301.08 Trainee Non-Members...............................................................................
301.10 Twenty-Five Year Member...........................................................................
301.11 AP................................................................................................
301.12 Membership Floor Access Badges....................................................................
305.00 Exchange Floor Fines..............................................................................
310.00 Time and Place for Trading........................................................................
310.01 Access to Trading Pit.............................................................................
311.00 Hours for Trading.................................................................................
311.00A Hours for Trading.................................................................................
312.01 Holidays..........................................................................................
313.00 Sundays or Holidays...............................................................................
Ch3 Market Quotations..........................................................................................
320.02 Wire and Other Connections........................................................................
320.03 Decisions of Exchange.............................................................................
320.04 Consent Required for Wires........................................................................
320.05 Registration with Exchange........................................................................
320.06 Notice of Discontinuance of Communications........................................................
320.07A Telephones........................................................................................
320.08 Conduct of Private Offices........................................................................
320.09 Telephone Wires and Television....................................................................
320.12 Radio Broadcasting................................................................................
320.13 Commodity and Commodity Option Quotations.........................................................
320.14 Transactions Made at other than Current Market....................................................
320.15 Market Quotations.................................................................................
320.16 Fast Quotations...................................................................................
320.17 Authority of Pit Committees over Quotation Changes and Insertions.................................
320.17A Authority of Pit Committees over Quotation Changes and Insertions.................................
320.17B Authority of Pit Committees over Quotation Changes and Insertions.................................
320.18 Authority of the Market Report Department and the Regulatory Compliance Committee over Quotation
Changes and Insertions............................................................................
320.19 Opening and Closing Orders........................................................................
321.00 Price Limits......................................................................................
Ch3 Market Information.........................................................................................
325.02 Foreign Crop Reports..............................................................................
Ch3 Floor Practices............................................................................................
330.00 Floor Brokers.....................................................................................
330.00A Brokers and Clearing Members......................................................................
330.01 Floor Broker and Floor Trader Registration........................................................
330.02 Maintenance of Floor Broker and Floor Trader Registration.........................................
330.03 Broker Associations...............................................................................
330.04 Registration of Members Trading in U.S. Treasury Bond Futures.....................................
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331.01 Price of Execution Binding........................................................................
331.01A Acceptable Orders.................................................................................
331.02 Acceptable Orders.................................................................................
331.03 All-Or-None Transactions..........................................................................
331.04 Execution of Simultaneous Buy and Sell Orders for Different Account Owners........................
332.00 Orders Must Be Executed in The Public Market......................................................
332.01 Open Market Execution Requirement.................................................................
332.01A Bidding and Offering Practices....................................................................
332.01B Conformation with Section 1.39 of The Commodity Exchange Act......................................
332.02 Trade Data........................................................................................
332.03 Lost Orders.......................................................................................
332.04 Records of Floor Traders..........................................................................
332.041 Accountability of Trading Cards...................................................................
332.05 Card Collection...................................................................................
332.06 Records of Proprietary Orders.....................................................................
332.07 Accountability of Trading Documents...............................................................
332.08 CTR Recordkeeping and Data Entry Requirements.....................................................
332.09 Member Trading for Another Member on the Trading Floor............................................
332.10 Prohibition of Trading or Placing Verbal or Flashed Orders from the Clerks Step in Financial
Futures and Options Contracts.....................................................................
333.00 Trades of Non-Clearing Members....................................................................
333.01 Error Accounts....................................................................................
333.02 Primary Clearing Members' Membership File Review..................................................
333.03 Funds in Trading Accounts Carried by Clearing Members.............................................
334.00 Trades of Non-Clearing Members....................................................................
335.00 Bids and Offers in Commodities Subject to First Acceptance........................................
336.00 Bids and Offers in Commodities Subject to Partial Acceptance......................................
336.01 Guaranteeing Terms of Execution...................................................................
337.01 Orders Involving Cancellations Accepted on a 'Not Held' Basis.....................................
350.00 Trade Checking Penalties..........................................................................
350.01 Failure to Check Trades...........................................................................
350.02 Responsibility For Customer Orders................................................................
350.03 Identification of Floor Trading Personnel and Floor Traders.......................................
350.04 Errors and Mishandling of Orders..................................................................
350.05 Floor Practices...................................................................................
350.06 Give-Ups..........................................................................................
350.07 Checking and Recording Trades.....................................................................
350.08 Notification of Unchecked Trades..................................................................
350.10 Exemption for Certain Joint Venture Products......................................................
350.11 Resolution of Outtrades...........................................................................
352.01 Spreading Transactions............................................................................
352.01A Unacceptable Spread Orders........................................................................
352.02 Joint Venture Intermarket and Inter-Regulatory Spreads............................................
360.01 Pit Supervisory and Enforcement Authority of the Respective Pit Committees........................
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Chapter 3
Exchange Floor Operations and Procedures
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Ch3 Exchange Halls
300.00 Exchange Halls - The Board shall provide Exchange Halls which shall be
open for trading during such hours as the Board of Directors shall designate.
For the purpose of Exchange rules, Exchange Halls may be deemed to include an
approved automated order entry facility. Complete jurisdiction over the Exchange
Halls, all parts of the building and any automated systems of the Association is
vested in the Board. 69 (08/01/94)
301.00 Admission to the Floor - No one but a member shall make any
transaction or execute orders in securities or commodities traded in or upon the
Floor of the Exchange. No one but a member shall be admitted to the Floor of the
Exchange, except as provided by Regulations adopted by the Regulatory Compliance
Committee. 259 (08/01/94)
301.01 Non-Members - No non-member shall be admitted to the Floor of the
Exchange except as provided in this Chapter 3. Persons not wearing a valid badge
shall not be admitted to the floor of the Exchange. 1370 (08/01/94)
301.02 Guest Badges - The Safety and Security Department may, upon
application of a member, issue a badge to a guest of the Exchange or, upon its
own initiative, issue a badge to a guest permitting access to the floor of the
Exchange. 1371 (08/01/94)
301.03 Guests - All guests of a member shall be accompanied by a member while
on the Exchange Floor and shall obey all Rules and Regulations respecting floor
conduct established herein for members. Members shall be responsible for all
violations of the Chicago Board of Trade Rules and Regulations committed by
their guests and for resulting fines. 1372 (08/01/94)
301.04 Press - Annual courtesy cards to the Press, permitting admission to
the Exchange Hall, may be issued and recalled by the written authorization of
the Communications Department. 1373 (08/01/94)
301.05 Floor Clerks - With the prior approval of the Floor Conduct Committee,
or designated Exchange staff pursuant to delegated authority, a non-member
employee of a member or member firm registered under Rule 230.00 may be admitted
to the Exchange Floor upon the payment by the employer of such periodic fees as
may be established by the Finance Committee. No floor clerk shall be permitted
to enter the Exchange Floor without a badge. Floor clerks may perform only such
services and other clerical, telephone and informational duties as may be
specifically permitted by the Regulatory Compliance Committee. (See Appendix
3B.)
Floor clerks are strictly prohibited from soliciting orders. Floor clerks may
not be registered as an Associated Person except as provided in Regulation
301.07. They may communicate orders to the pit from their position or
communications instrument by use of hand signals or verbal notification. When
communicating orders in either fashion, a record must immediately be made and
time-stamped in accordance with Regulation 465.01.
Floor clerks are not permitted to run on the Exchange Floor or in the corridors
of the building and shall at all times maintain decorum. The Floor Conduct
Committee may recall floor clerk badges for cause and may exclude from the Floor
any non-member employee of any member.
The responsibility of conduct and appearance of employees on the Exchange Floor
shall be that of the member employer.
Notwithstanding Rule 420.00, nonmembers holding a Floor Clerk badge or a Broker
Assistant badge shall not have any interest whatsoever in a commodity futures or
commodity options account which contains positions in contracts traded on the
Exchange or the MidAmerica Commodity Exchange. No member or member firm may
jointly hold such an account with a nonmember Floor Clerk or Broker Assistant,
and no member firm may accept or carry any such account in which a nonmember
Floor
Clerk or Broker Assistant holds any interest. Provided, however, that the
following shall apply to any person who has Associate Membership, Membership
Interest, or permit holder status on the Exchange or Membership status on the
MidAmerica Commodity Exchange and who also holds a Floor Clerk or Broker
Assistant badge:
Such person shall not trade for, or carry in his account or an account in which
he has any interest, any positions in contracts traded on the Exchange or the
MidAmerica Commodity Exchange except for those contracts which he is entitled to
trade as principal or broker for others by virtue of his Membership, Membership
Interest or permit holder status as referenced above. However, a Member,
Membership Interest Holder or permit holder who holds a Broker Assistant badge,
and who stands in an area designated for broker assistants outside of a
financial futures or financial options pit, may carry in his account or an
account in which he has an interest, any positions in contracts traded on the
Exchange or the MidAmerica Commodity Exchange, provided that the orders for such
positions are placed through the normal customer order flow process.
These provisions shall not be interpreted to prohibit an individual from being
employed as a Floor Clerk or a Broker Assistant simply because another family
member is a member of the Exchange who trades for his or her own personal
account, whether such individual is employed by the family member or by another
member. However, Floor Clerks and Brokers Assistrants are strictly prohibited
from initiating trades or advising on the initiation of trades for a family
member's account or any other account.
Violations of this Regulation shall be cause for suspension or revocation of a
person's floor access privileges and for suspension or expulsion of his
employer, or such other action as the Floor Conduct Committee may deem
appropriate, in accordance with the applicable procedures set forth in Chapter
5. In the event a floor clerk is registered as an Associated Person in violation
of this Regulation, after notice and for good cause shown, the Floor Conduct
Committee may cause such floor clerk's floor access keycard to be immediately
deactivated and take whatever other disciplinary action it deems necessary
consistent with this Regulation. Upon termination of the Associated Person
status, a floor clerk's keycard may be reactivated.
A non-clearing member holding a Floor Clerk or Broker Assistant badge shall be
required to notify his Primary Clearing Member, as defined in Rule 333.00, of
the name, address and immediate supervisor of the member or member firm by whom
he is employed as a Floor Clerk or Broker Assistant. Upon a Primary Clearing
Member's revocation of clearing authorization in accordance with Rule 333.00(c),
the Primary Clearing Member immediately shall give written notice to the member
or member firm who employs a non-clearing member as a Floor Clerk or Broker
Assistant that the non-clearing member's clearing authorization has been
revoked. A non-clearing member holding a Floor Clerk or Broker Assistant badge
shall be denied floor access privileges upon the revocation of clearing
authorization by his Primary Clearing Member. The floor access privileges of a
non-clearing member who holds a Floor Clerk or Broker Assistant badge may be
reinstated upon the filing of a release with the Member Services Department by
the non-clearing member's Primary Clearing Member in accordance with Rule
333.00(d). (04/01/97)
301.06 Floor Access by Annual Election Candidates and Non-Member (Public)
Directors -
The following are permitted physical access to the Floor of the Exchange:
a) Candidates in the current year's Annual Election who:
- Have been nominated either by the Nominating Committee or by petition
pursuant to Rule 102.00; and
- Do not already have Exchange Floor access by virtue of a membership
privilege.
b) Non-member (public) Directors on the Association's Board.
Individuals who are admitted to the Exchange Floor pursuant to this regulation
shall not be authorized thereby to execute trades or to perform any other
functions which are reserved to members or clerks on the Exchange Floor.
(06/01/00)
301.07 Floor Clerk-Special Badges - The Floor Conduct Committee, or
designated Exchange staff pursuant to delegated authority, may issue special
badges authorizing non-member employees of
Ch3 Exchange Halls
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members or member firms to perform the duties of a "Floor Clerk" as defined in
Regulation 301.05. Such authorization shall be for a specific period not to
exceed two weeks. The Member Firm Staff Services Department shall maintain
proper records of these authorizations.
When such non-member employees are Associated Persons, such authorization may be
granted for a specific period not to exceed three business days but only if the
employer demonstrates to the satisfaction of the Floor Conduct Committee, or
designated staff pursuant to delegated authority, that it temporarily lacks
enough available Floor Clerks to meet its business needs. No particular employee
can be so authorized for more than three days in any calendar month. Applicants
for membership may be issued special badges by the Exchange Services Department
for a period of ten business days. (08/01/94)
301.08 Trainee Non-Members - The Floor Conduct Committee, or designated
Exchange staff pursuant to delegated authority, shall, upon written request
signed by a member and directed to the Secretary, issue badges to trainee non-
member employees of members or member firms, authorizing admission of such
trainees to the Exchange Hall. Such authorization shall be limited to a thirty-
day period as to any trainee and no member or member firm shall be allowed to
have more than one trainee on the Exchange Floor at any one time. Trainees may
perform the duties of a "Floor Clerk" as defined in Regulation 301.05. The
member or member firm which is the employer of the trainee shall be responsible
for his conduct while he is on the Floor. The Member Firm Staff Services
Department shall maintain proper records of these authorizations. No member or
member firm shall use the provisions of this Regulation to avoid the purchase of
a membership. 1377 (08/01/94)
301.10 Twenty-Five Year Member - When a member who has been a member for
twenty-five years or more transfers his Membership privilege or delegates the
rights and privileges of his Membership under Rule 221.00, said member shall be
issued an Honorary Membership Badge by the Secretary's Office which will entitle
the former member to access to the Trading Floor (with the exception of the
Trading Pits), and to remain on the Association's mailing lists. 1379 (11/01/94)
301.11 AP - With the prior approval of the Floor Conduct Committee, or
designated Exchange staff pursuant to delegated authority, an Associated Person
and an applicant for membership may be admitted to the Floor of the Exchange for
the limited purpose of observing various Floor activities of the members and
other privileged non-members who have been allowed access to the Floor. Such
admittance shall be limited to a period of two weeks (ten business days). 1380
(08/01/94)
301.12 Membership Floor Access Badges - Any member, membership interest
holder or delegate whose floor access trading privileges have been revoked,
suspended or lawfully discontinued for any reason must return the floor access
membership badge and access card to the Member Services and Member Firm Staff
Services Department within 30 days from the termination of floor access
privileges. Any failure to comply with this Regulation will be referred to the
Floor Conduct Committee.
Willful possession of a membership floor access badge or access cards by anyone
not then entitled to the privileges of that membership shall be an act
detrimental to the Association. (09/01/00)
305.00 Exchange Floor Fines - (See 519.00) and (See 520.00A) (08/01/94)
310.00 Time and Place for Trading - Dealings upon the Exchange shall be
limited to the hours during which the Exchange is open for the transaction of
business, and no member shall make any transaction in securities with another
member except at the post designated for the particular security in which the
transaction is made and no member shall make any transaction for future delivery
of a commodity except in the pit assigned to trading in such commodity, except
as provided in Regulations 444.01, 444.03, and Chapter 9B. No member shall make,
in the rooms of the Association, a transaction with a non-member, in any
commodity or in any security admitted to dealing on the Exchange; but this
Regulation shall not apply to transactions with an employee of the Association
or of the Clearing House engaged in carrying out arrangements approved by the
Regulatory Compliance Committee to facilitate the borrowing and lending of
money. 258 (11/01/94)
310.01 Access to Trading Pit - Trading in any commodity or option thereon
shall be limited to an area specified by the Exchange Services Department. Non-
members shall not be authorized to enter the trading areas except as otherwise
provided in the Rules and Regulations. (08/01/94)
Ch3 Exchange Halls
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311.00 Hours for Trading - (See 1007.00) (08/01/94)
311.00A Hours for Trading - Your Rules and Floor Committees have given careful
consideration to reports of trading outside of the hours prescribed and
recommend enforcement of Rule 1007.00. We feel that disciplinary action is
warranted on any infractions.
Strict observance of the above requires that after the closing bell no orders
should be transmitted to the Floor, nor should any orders be accepted by brokers
for filling, nor should any public wire orders be sent to the pit,-all such
being reported back to senders 'received too late, market closed.'
All members should caution clients who want orders filled on or near the close
to enter such orders to be filled 'about the close,' so that the broker may
handle them properly. On the last trading day of a current month it is essential
that all orders to close contracts reach the traders in sufficient time to
permit filling without congestion.
Members who trade the options underlying the Soybean Meal, Soybean Oil, Oat and
Silver Futures markets may enter futures orders during the respective futures
markets' "closing call rotations" providing that the futures orders are entered
for the purpose of hedging an option position. 13R (04/01/99)
312.01 Holidays - The following days are declared to be holidays, to wit: New
Year's Day (January 1), Martin Luther King, Jr. Day (3rd Monday in January),
Washington's Birthday (3rd Monday in February), Good Friday, Memorial Day (last
Monday in May), Independence Day (July 4), Labor Day (1st Monday in September),
Thanksgiving Day (4th Thursday in November) and Christmas Day (December 25).
When any such holidays fall on Sunday, the Monday next following shall be
considered such holiday. When any such holidays fall on Saturday, the Friday
immediately preceding shall be considered such holiday. 1937 (12/01/99)
313.00 Sundays or Holidays - When a contract in commodities matures on
Sunday, or on a holiday, performance thereof shall be made on the preceding
business day. 256 (08/01/94)
Ch3 Market Quotations
320.02 Wire and Other Connections - The privilege of telephonic or other wire
connection between the office of a member and the Exchange shall not be enjoyed
as a right of the member, but shall rest in the discretion of the Exchange.
The Exchange, in its discretion may grant or withhold such privilege from a
member, and, in its discretion, without being obliged to assign any reason or
cause for its action, may disconnect or cause to be disconnected any apparatus
or means for such communication or may deprive any member of the privilege of
using any public telephone or means of communication installed by the Exchange
for the use of members. This Regulation shall not apply to wire or other
connections relating to the Exchange's e-cbot system. 1031 (09/01/00)
320.03 Decisions of Exchange - Every decision of the Exchange, whereby a
member is deprived of any such privilege, shall be immediately posted upon the
bulletin board in the Exchange, and every member shall be deemed to have notice
thereof.
No member shall, after such notice shall have been posted directly or indirectly
furnish to the member named therein any facilities for communication between the
office of the member so named and the Floor of the Exchange or between the
office of the member so named and the office of any other member. 1032
(10/01/94)
320.04 Consent Required for Wires - No member shall establish or maintain
wire connection of any description whatsoever or permit wireless communication
between his office and the office of any nonmember corporation, firm, or
individual transacting a banking or brokerage business, without having first
obtained the approval of the Exchange therefor.
The applications for such connections or means of communication shall be in a
form prescribed by the Exchange.
The use of public telephone or telegraph service in such manner as to amount to
private connection shall be deemed to be within this Regulation. 1033
(08/01/94)
320.05 Registration with Exchange - Every such means of communication shall
be registered with the Exchange, together with the telegraphic, telephonic, or
wireless calls used in connection therewith; the Exchange may make such
requirements governing said matters as it shall deem necessary or desirable.
1034 (08/01/94)
320.06 Notice of Discontinuance of Communications - Notice of the
discontinuance of any such means of communication shall be promptly given to the
Exchange; and the Exchange shall have power, at any time in its discretion, to
order any such means of communication discontinued.
No such communication shall be other than by means of a wire or wireless system
approved by the Exchange. 1035 (08/01/94)
320.07A Telephones - Exchange policy permits direct telephone communications
to the Trading Floor from the members or member firms to the table or booth of a
clearing member on the Trading Floor. 34R (08/01/94)
320.08 Conduct of Private Offices - The Exchange is empowered to examine into
the conduct of all private offices or places of business receiving the
continuous market quotations of the Association, and, in such places where the
Exchange shall deem the continuance of such service detrimental to the best
interests of this Association, the Exchange shall forthwith order a
discontinuance of the quotations and shall report the facts immediately to the
Finance Committee, which shall take whatever further action is necessary to
uphold the good name and dignity of this Association. 1040 (08/01/94)
320.09 Telephone Wires and Television - No member of this Association shall,
by messenger, signal, telephone, telegraph, or any other means whatsoever,
convey or transmit continuously the market quotations from the Floor of the
Exchange to any person, firm, or corporation located off the Floor of the
Exchange, except with the permission and pursuant to the requirements of the
Exchange. This does not prohibit ordinary conversation where dissemination of
quotations is not contemplated.
Ch3 Market Quotations
---------------------
Such permission for telephone wires, if granted, shall be subject to charges as
prescribed by Regulation 320.13. Such permission for closed-circuit television,
if granted, shall be subject to charges as may be prescribed by the Finance
Committee. 1041 (08/01/94)
320.12 Radio Broadcasting -
(a) No member, firm, corporation or employee thereof shall transmit, by any kind
of radio service, any market quotations, either securities, futures, cash
grain on spot or to arrive, or any market information or gossip without the
approval of the Exchange.
(b) No quotations except those prevailing at the opening of the market; and at
each thirty minutes thereafter; and at the close of the market, may be used
for broadcasting.
(c) Radio broadcasting stations must name the periods at which the quotations
prevailed and designate them as furnished by the Board of Trade of the City
of Chicago.
(d) No member, firm, corporation, or employee thereof shall in any manner claim
or be given credit for furnishing information for radio service, except as
provided in section (c) of this Regulation.
(e) Upon application, the Exchange may grant permission to individuals, firms,
corporations, or employees thereof, to furnish the quotations of this
Association to radio stations. The name of the individual, firm,
corporation, or employees thereof, may be mentioned at the beginning and at
the end of each period at which quotations are broadcast. In case there is
more than one request to furnish this service at any location, the Exchange
may divide the time equally upon a yearly basis. 1044 (08/01/94)
320.13 Commodity and Commodity Option Quotations - The transmission by
private wire or other means of market quotations of any commodity or commodity
option made on the Exchange shall be subject to the approval and control of the
Exchange. Such quotations shall include all bids, asks, and market prices of any
commodity or commodity option traded on the Exchange each business day between
the opening of trading in such commodity or option and until thirty minutes
after the close of such trading. Such quotations constitute valuable property of
the Board of Trade which are not within the public domain. The transmission and
receipt of such quotations shall be subject to such conditions, including the
payment of applicable fees, as the Exchange shall impose. Failure to comply with
such conditions shall subject any member receiving or distributing such
quotations to disciplinary action including suspension from the Association.
(08/01/94)
320.14 Transactions Made at other than Current Market - Transactions made at
a price above that at which the same futures contract or options series is
offered, or below that at which such futures or options contract is bid, are not
made at the current market price for such futures or options contracts and shall
be disallowed by the action of any two members of the relevant Pit Committee. If
so disallowed, such transactions shall not be reported or recorded by the
Exchange or, if already reported, shall be cancelled. A determination on whether
a price(s) should be disallowed must be made within 10 minutes after the Pit
Committee has been notified that the price has been called into question,
otherwise the quote(s) in question must stand. A determination pursuant to this
Regulation to disallow a transaction shall be final. (05/01/97)
320.15 Market Quotations - The reporter in each pit shall be the judge of
what constitutes a proper range of quotations to be sent out, subject to the
supervision of the Pit Committee in the respective pits.
Quotations sent out must be based on transactions made in the open market. The
term "open market" means a bid or an offer openly and audibly made by a public
outcry and in such a manner as to be open to all members in the pit at the time.
It is not permissible for members to reform a trade by changing the price at
which orders have been filled, nor to report as filled orders that have not been
filled. Any quotations based on a transaction made in the open market, already
distributed or sent out over the wire, shall not be cancelled except as provided
by Regulations 320.17, 320.18 and 320.14. (08/01/94)
320.16 Fast Quotations - Whenever price fluctuations in the pit(s) are rapid
and the volume of business is large, the pit reporter, upon authorization of the
Pit Committee Chairman or his designated representative from the Pit Committee,
shall cause the "FAST" symbol to be used in conjunction with
Ch3 Market Quotations
---------------------
all Exchange quotation displays and records. (The "FAST" symbol shall be
abbreviated "F" when used on Exchange quotation and display devices.) The Pit
Committee shall determine at what time "FAST" market conditions began and
terminated. When a market is designated "FAST", the Pit Reporter shall endeavor
to activate a "FAST" market indicator clearly visible to the entire trading
floor.
All prices in the range between those quoted immediately prior to and
immediately following the "FAST" market designation are considered officially
quoted whether or not such prices actually appear as trades on Exchange
quotation displays and records. There shall be no discontinuances.
The consequence of "FAST" market conditions is that a penetrated limit order may
not be able to be executed at the specified limit price.
In the event that a dispute arises concerning the execution of an order, the
fact that a market was designated "FAST" shall constitute evidence that market
conditions were rapid and volatile. A "FAST" designation does not nullify or
reduce the obligations of the floor broker to execute orders with due diligence
according to the terms of the order. Trading activities which violate the Rules
and Regulations of the Exchange remain violations under "FAST" market
conditions. (08/01/94)
320.17 Authority of Pit Committees over Quotation Changes and Insertions -
(a) The Pit Committee Chairmen, Vice Chairmen or their Pit Committee designees
may change an opening range only within 30 minutes after the opening of the
commodity.
(b) The Pit Committee Chairmen, Vice Chairmen or their Pit Committee designees
may change a closing range only within 15 minutes after the closing of the
commodity.
(c) The Pit Committee Chairmen, Vice Chairmen or their Pit Committee designees
may authorize the insertion of a quotation which affects a high or low at
any time prior to 15 minutes after the closing of the commodity.
(d) The Pit Committee Chairmen, Vice Chairmen or their Pit Committee designees
may authorize any quotation change or insertion which does not affect an
open, high, low or close at any time prior to the opening of the commodity
on the next business day.
No Pit Committee member may authorize any quotation change, insertion or
cancellation, if such individual has a personal or financial interest in such
change, insertion or cancellation.
All quotation changes, insertions, or cancellations must be authorized by at
least two Pit Committee members. However, if there is only one Pit Committee
member who does not have a personal or financial interest in a change, insertion
or cancellation, that one Pit Committee member may authorize such change,
insertion or cancellation.
When a Pit Committee member is requested to authorize a quotation change,
insertion or cancellation, the relevant pit shall be notified of such request.
1037 (09/01/96)
320.17A Authority of Pit Committees over Quotation Changes and Insertions -
Silver:
In respect to Quotation Changes and Insertions under Regulation 320.17 the Pit
Committee may change a closing range only within 20 minutes after the close of
Silver and may authorize the insertion of a quotation which affects a high and
low at any time prior to 20 minutes after the close of Silver. (08/01/94)
320.17B Authority of Pit Committees over Quotation Changes and Insertions -
Futures Options (Puts and Calls) - In respect to Quotation Changes and
Insertions under Regulation 320.17, the Pit Committee may change a closing range
only within 30 minutes after the close of each Futures Options contract (Puts
and Calls) and may authorize the insertion of a quotation which affects a high
and low at any time prior to 30 minutes after the close of each Futures Options
contract (Puts and Calls). (08/01/94)
320.18 Authority of the Market Report Department and the Regulatory
Compliance Committee over Quotation Changes and Insertions -
(a) The Market Report Department may review and authorize any request for a
quotation change or insertion which does not affect an open, high, low or
close and which was not reviewed by the Pit Committee.
Ch3 Market Quotations
---------------------
(b) The Market Report Department may review and make recommendations to the
Regulatory Compliance Committee on all requests for quotation changes and
insertions which affect an open, high, low or close and are not encompassed
by Regulation 320.17. The final disposition of such requests will be left to
the Regulatory Compliance Committee. 1038 (09/01/94)
320.19 Opening and Closing Orders - For open outcry Regular Trading Hours,
orders entered prior to or on the opening (or resumption) of the market, as
applicable and orders effected by such opening (or resumption) orders, as
applicable shall not be required to be executed at a specified price due to the
unique and rapid market conditions existing during an opening or a resumption.
Similarly, orders entered for execution on the close of the market and orders
effected by such closing orders shall not be required to be executed at a
specific price due to the unique and rapid market conditions existing during a
close.
If stop orders are elected within the opening or resumption range, floor brokers
who are unable to execute those orders within the opening or resumption range,
as applicable, while diligently acting in conformity with the rules and
regulations of the Association, shall not be held liable. Stop orders elected
during the opening (or resumption) range automatically become market orders and
should be executed at the prevailing market, which may or may not be within the
opening (or resumption) range. If stop orders are elected within the closing
range, floor brokers who are unable to execute such orders, while diligently
acting in conformity with the rules and regulations of the Association, shall
not be held liable. (09/01/98)
321.00 Price Limits - The Regulatory Compliance Committee at any time, upon
ten hours' notice by Regulation, may provide that there shall be no trading
during any day in any grain, provisions, or cottonseed oil for delivery in any
specified month at prices more than a fixed limit above or below the average
closing price of the preceding business day. 83 (C.R. 1008.01) (08/01/94)
Ch3 Market Information
325.02 Foreign Crop Reports - When a member, employing a crop reporter,
receives from the reporter a statement concerning foreign crop conditions to
which publicity is given, the member shall file immediately a verbatim copy of
the report in the office of the Secretary. 1802
(08/01/94)
Ch3 Floor Practices
330.00 Floor Brokers - A member, who executes orders for another member and
who is not a member of the Clearing House, must immediately give up the name of
a clearing member. A floor broker trading for a member shall be liable as
principal for the performance of the contract except that in the case of
commodities his liability shall terminate when the transaction is accepted by
the principal. 200 (08/01/94)
330.00A Brokers and Clearing Members - Trades between members of the Clearing
House must be confirmed within one hour by depositing at the office of the
Clearing House a check slip or memorandum giving the name of the buyer and
seller, the commodity sold, the amount thereof, the delivery month, and the
purchase price. 4R (08/01/94)
330.01 Floor Broker and Floor Trader Registration - No member may execute any
trade on the floor of the Exchange for any other person unless the member is
registered or has been granted a temporary license as a floor broker, nor may a
member execute any trades on the floor of the Exchange for his or her own
account unless the member is registered or has been granted a temporary license
as a floor trader, or has been granted a temporary license as a floor broker to
act as a floor trader, in accordance with Section 4f of the Commodity Exchange
Act and Commodity Futures Trading Commission Regulations 3.11 and 3.40, and such
temporary license or registration has not been terminated, revoked or withdrawn.
A floor broker or floor trader shall be prohibited from engaging in any
activities requiring registration, or from representing himself to be registered
or the representative or agent of any registrant, during the period of any
suspension of registration or membership privileges or the denial of floor
access. Willful failure to comply with this Regulation may be deemed an act
detrimental to the interest of the Association. (08/01/94)
330.02 Maintenance of Floor Broker and Floor Trader Registration - Each
member registered as a floor broker or floor trader must promptly submit to the
Exchange any changes in the information contained in such member's registration
application (Form 8-R) or any supplement thereto. All floor brokers and floor
traders must review their registration information every three years in
accordance with Commodity Futures Trading Commission ("CFTC") Regulation
3.11(d). Additionally, the Exchange shall periodically require such members to
confirm that their floor broker registration applications contain complete and
accurate information.
Requests for withdrawal of floor broker or floor trader registration must be
made on Form 8-W and filed with the National Futures Association and the
Association in accordance with CFTC Regulation 3.33.
All registered floor brokers and floor traders periodically must attend ethics
training in accordance with the guidelines set forth in CFTC Regulation 3.34.
(08/01/94)
330.03 Broker Associations - Two or more Exchange members with floor trading
privileges, of whom at least one is acting as a floor broker, shall be required
to register with the Exchange as a Broker Association, within ten days after
establishment of the Broker Association, if they: (1) engage in floor brokerage
activity on behalf of the same employer, (2) have an employer and employee
relationship which relates to floor brokerage activity, (3) share profits and
losses associated with their brokerage or trading activity, or (4) regularly
share a deck of orders.
The Broker Association shall file its registration statement in a form provided
by the Exchange. Such registration statement shall specifically disclose
whether the members of the broker association share commissions, profits, losses
or expenses associated with their brokerage or trading activity with each other
or with any other individual or entity. In addition, such registration
statement shall disclose whether or not the members of the broker association
have any other business relationships with one another, whether related or
unrelated to Exchange business. Members of the broker association shall be
required to provide information regarding such other business relationships,
including books and records relating to such businesses, upon the request of
OIA. Any registration information provided to the Exchange which becomes
deficient or inaccurate must be updated or corrected promptly.
A member of a Broker Association shall be prohibited from receiving or executing
an order unless the Broker Association is registered with the Exchange.
Ch3 Floor Practices
-------------------
Members of a broker association may not share profits or losses associated with
their personal trading activity by direct or indirect means.
No registered broker association or member thereof shall permit a non-member or
non-member firm to have any direct or indirect profit or ownership interest in a
registered broker association. Moreover, no registered broker association or
member thereof shall permit a member who is not involved in the pre-execution or
execution of customer orders to have any direct or indirect profit or ownership
interest in a registered broker association.
The Board may establish limits on the percentage of trading between a member of
a broker association and (1) other members of broker associations with which he
is affiliated; or (2) members of other broker associations which are positioned
contiguously to his broker association in the trading pit.
Any such limits established by the Board shall take account of liquidity and
such other conditions, from contract to contract, and shall only apply to the
most active month or months of any contract. Compliance shall be measured
separately for each full calendar month.
The Regulatory Compliance Committee may grant exceptions to the percentage
limits on intra-association or contiguous association trading in circumstances
where a broker association can demonstrate that compliance with the limits may
reduce liquidity or impede the creation of new business in the affected market.
(04/01/98)
330.04 Registration of Members Trading in U.S. Treasury Bond Futures - Each
Exchange member with floor trading privileges who customarily stands on the top
step of the U.S. Treasury Bond futures pit shall be required to register with
the Exchange, identifying his affiliation, location and occupation or duties.
Such individuals shall file their registration statements in a form provided by
the Exchange. Any registration information provided to the Exchange which
becomes deficient or inaccurate must be updated or corrected promptly.
(09/01/94)
331.01 Price of Execution Binding - The price at which an order for
commodities is executed on the Exchange shall be binding notwithstanding the
fact that an erroneous report in respect thereto may have been rendered. A
member shall not guarantee the price of execution to any customer, but a floor
broker's or clearing firm's error in handling a customer order may be resolved
by a monetary adjustment in accordance with Regulation 350.04. 1841 (09/01/94)
331.01a Acceptable Orders - Market orders to buy or sell, closing orders to
buy or sell, spread orders, straight limit orders to buy or sell, and straight
stop orders to buy or sell shall be permitted during the last day of trading in
an expiring future. Time orders, contingency orders of all kinds, market on
close intermonth spread orders involving an expiring future and cancellations
that reach the Trading Floor after 11:45 a.m. on the last day of trading in an
expiring future may involve extraordinary problems and hence will be accepted
solely at the risk of the customer. This Regulation shall only apply to open
outcry Regular Trading hours. 32R (09/01/98)
331.02 Acceptable Orders - The following orders are acceptable for execution
in this market.
(1). Market order to buy or sell - A market order is an order to buy or sell a
stated amount of commodity futures contracts at the best price obtainable.
(2). Closing orders to buy or sell - A closing order to buy or sell is a market
order which is to be executed at or as near the close as practicable or on
the closing call in a call market.
(3). Limit order to buy or sell - A limit order is an order to buy or sell a
stated amount of commodity futures contracts at a specified price, or at a
better price, if obtainable.
(4). Stop order to buy or sell - A stop order to buy becomes a market order when
the stop price is bid or a transaction in the commodity futures contracts
occurs at or above the stop price. A stop order to sell becomes a market
order when the stop price is offered or a transaction in the commodity
futures contract occurs at or below the stop price.
(5). Stop limit order to buy or sell (where the price of the limit is the same
as the stop price only) - A stop limit order to sell becomes a limit order
executable at the limit price or at a better price, if obtainable when a
transaction in the commodity futures contract is offered or occurs at or
below the stop price. A stop limit order to buy becomes a limit order
executable at the limit price or at a
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better price, if obtainable when a transaction in the commodity futures
contract is bid or occurs at or above the stop price.
(6). DRT ("Disregard Tape" or "Not Held") Order - An order giving the floor
broker complete discretion over price and time in execution of a trade,
including discretion to execute all, some or none of the order. It is
understood the floor broker accepts such an order solely at the risk of the
customer on a "not held" basis.
(7). All-Or-None order to buy or sell - An order to be executed only for its
entire quantity at a single price and with a size at or above a
predetermined threshold. Such orders must be executed in accordance with
Regulation 331.03.
Orders other than those listed above will be accepted solely at the broker's
discretion on a not held basis. This Regulation shall only apply to Regular and
Night trading hours. (07/01/00)
331.03 All-Or-None Transactions - Board of Directors shall determine the
minimum thresholds for and the commodities in which All-Or-None transactions
shall be permitted. The following provisions shall apply to All-Or-None
trading:
(a) A member may request an All-Or-None bid and/or offer for a specified
quantity at or in excess of the applicable minimum threshold
designated. The request shall be made during the hours of regular
trading in the appropriate trading area.
(b) A member may respond by quoting an All-Or-None bid or offer price. A
bid or offer in response to an All-Or-None request shall be made only
when it is the best bid or offer in response to such request, but such
price need not be in line with the bids and offers currently being
quoted in the regular market.
(c) A member shall not execute any orders by means of an All-Or-None
transaction unless the order includes specific instructions to execute
an All-Or-None transaction or the All-Or-None bid offer is the best
price available to satisfy the terms of the order.
(d) An All-Or-None bid or offer may only be accepted by a single member
for the total amount offered or bid. No partial fills are permitted.
(e) The price at which an All-Or-None transaction is bid, offered or
executed will not elect conditional orders (e.g., limit orders, stop
orders, etc.) in the regular market or otherwise affect such orders.
(f) All-Or-none transactions must be reported to the reporter in each pit
who shall record the price quotes for All-Or-None transactions.
(g) A member who has received both buying and selling All-Or-None orders
from different account owners for the same commodity and the same
delivery month, or, for options, the same option, may execute such
orders for and directly between such account owners provided that the
member shall first bid and offer openly and competitively by open
outcry at the same price, stating the number of contracts. If neither
the bid nor the offer is accepted within a reasonable time, the orders
may then be matched by the member in the presence of a member of the
Pit Committee. The member making the trade shall clearly identify it
on the order or other document used to record the trade, shall note
thereon the time of execution to the nearest minute, and shall present
such record to such member of the Pit Committee for verification and
initialing. Each such transaction shall be recorded by such Pit
Committee member on a cross-trade form that shall show the trade data
and be made a matter of permanent record by the Exchange. (07/01/00)
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331.04 Execution of Simultaneous Buy and Sell Orders for Different Account
Owners - A member who has received both buying and selling orders from different
account owners for the same commodity and the same delivery month or, for
options, the same option, may execute such orders for and directly between such
account owners provided that the member shall first bid and offer openly and
competitively by open outcry at the same price, stating the number of contracts.
If neither the bid nor the offer is accepted within a reasonable time, the
orders may then be matched by the member in the presence of a member of the Pit
Committee. If either the bid or the offer is accepted in part, the remainder of
the orders may be matched pursuant to the requirements of this Regulation. The
member making the trade shall clearly identify it on the order or other document
used to record the trade, shall note thereon the time of execution to the
nearest minute, and shall present such record to such member of the Pit
Committee for verification and initialing.
Each such transaction shall be recorded by such Pit Committee member on a cross-
trade form that shall show the trade data and be made a matter of permanent
record by the Exchange. (07/01/2000)
332.00 Orders Must Be Executed in The Public Market - All orders received by
any member of this Association, firm or corporation, doing business on Change,
to buy or sell for future delivery any of the commodities dealt in upon the
Floor of the Exchange (except when in exchange for cash property) must be
executed competitively by open outcry in the open market in the Exchange Hall
during the hours of regular trading and, except as specifically provided in
Regulations 331.03, 331.04 and 350.10 under no circumstances shall any member,
firm or corporation assume to have executed any of such orders or any portion
thereof by acting as agent for both buyer and seller either directly or
indirectly, in their own name or that of an employee, broker or other member of
the Association; provided, that on transactions where brokers as agents for
other members meet in the execution of orders in the open market and without
prearrangement unintentionally consummate a contract for the one and same
clearing member principal, such transactions shall not be considered in
violation of this Rule. 202A (07/01/00)
332.01 Open Market Execution Requirement - All futures transactions resulting
in change of ownership (except those involving the exchange of futures in cash
transactions) must be made in the open market in the manner prescribed by Rules
332.00 and 310.00. 1866 (08/01/94)
332.01A Bidding and Offering Practices - Bidding and offering practices on the
Floor of the Exchange must at all times be conducive to competitive execution of
orders, as required by Rule 332.00. Bids or offers of 'all the way to,' 'all you
have up (or down) to, 'everything you have up (or down) to,' and similar
expressions, are not conducive to competitive execution of orders, and are
expressly deemed to be in violation of Rule 332.00. 47R (08/01/94)
332.01B Conformation with Section 1.39 of The Commodity Exchange Act - The
Board of Directors at their regular meeting held on Tuesday, September 6th,
1955, ruled that inasmuch as the Chicago Board of Trade has no Rule that
conforms to Section 1.39 of the Commodity Exchange Act, Rule 332.00 of the
Board's Rules and Regulations prevails. 28R (08/01/94)
332.02 Trade Data - Each member executing transactions on the Floor of the
exchange shall enter or cause to be entered on the record of those transactions
an indicator designating the time bracket within the trading session in which
each execution occurred. Each clearing member shall enter only the bracket
information submitted to the clearing member by the member executing the trades
in the designated form on the record of transactions submitted to the Clearing
House. The brackets and their designations will be as follows:
[Enlarge/Download Table]
7:00-7:15 a.m. A 11:30-11:45 a.m. S 5:00-5:15 p.m. A
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7:15-7:30 a.m. B 11:45-12:00 noon T 5:15-5:30 p.m. B
--------------------------------------------------------------------------------------------------------
7:30-7:45 a.m. C 12:00-12:15 p.m. U 5:30-5:45 p.m. C
--------------------------------------------------------------------------------------------------------
7:45-8:00 a.m. D 12:15-12:30 p.m. V 5:45-6:00 p.m. D
--------------------------------------------------------------------------------------------------------
8:00-8:15 a.m. E 12:30-12:45 p.m. W 6:00-6:15 p.m. E
--------------------------------------------------------------------------------------------------------
8:15-8:30 a.m. F 12:45-1:00 p.m. X 6:15-6:30 p.m. F
--------------------------------------------------------------------------------------------------------
8:30-8:45 a.m. G 1:00-1:15 p.m. Y 6:30-6:45 p.m. G
--------------------------------------------------------------------------------------------------------
8:45-9:00 a.m. H 1:15-1:30 p.m. Z 6:45-7:00 p.m. H
--------------------------------------------------------------------------------------------------------
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[Enlarge/Download Table]
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9:00-9:15 a.m. I 1:30-1:45 p.m. 2 7:00-7:15 p.m. I
--------------------------------------------------------------------------------------------------------
9:15-9:30 a.m. J 1:45-2:00 p.m. 3 7:15-7:30 p.m. J
--------------------------------------------------------------------------------------------------------
9:30-9:45 a.m. K 2:00-2:15 p.m. 4 7:30-7:45 p.m. K
--------------------------------------------------------------------------------------------------------
9:45-10:00 a.m. L 2:15-2:30 p.m. 5 7:45-8:00 p.m. L
--------------------------------------------------------------------------------------------------------
10:00-10:15 a.m. M 2:30-2:45 p.m. 6 8:00-8:15 p.m. M
--------------------------------------------------------------------------------------------------------
10:15-10:30 a.m. N 2:45-3:00 p.m. 7 8:15-8:30 p.m. N
--------------------------------------------------------------------------------------------------------
10:30-10:45 a.m. O 3:00-3:15 p.m. 8 8:30-8:45 p.m. O
--------------------------------------------------------------------------------------------------------
10:45-11:00 a.m. P 3:15-3:30 p.m. 9 8:45-9:00 p.m. P
--------------------------------------------------------------------------------------------------------
11:00-11:15 a.m. Q 9:00-9:15 p.m. Q
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11:15-11:30 a.m. R 9:15-9:30 p.m. R
--------------------------------------------------------------------------------------------------------
The first time bracket in the trading session of each respective commodity will
be less than 15 minutes, as determined by the Regulatory Compliance Committee
for each particular contract, and will be designated by a "dollar" sign "$".
The last time bracket in the trading session of each respective commodity will
be one minute or less, as determined by the Regulatory Compliance Committee for
each particular contract, and will be designated by a "percent" sign "%";
provided however, that each respective contract market's close may be expanded
or reduced by an amount of time which shall not exceed one minute due to unique
market conditions on a particular trade date as determined in the discretion of
each commodity's Pit Committee; any closing period other than that established
by the Regulatory Compliance Committee shall be communicated to the market at
least five minutes prior to the commencement of the revised close for that date.
The modified closing call in the trading session of each respective commodity
will be designated by a "pound" sign "#".
If the member executing the trades does not submit a bracket designation to the
clearing member, the clearing member shall enter "?" as the bracket designation
when submitting the record of such transaction to the Clearing House. 1979
(09/01/94)
332.03 Lost Orders - Any broker who has reason to believe that an order has
been lost or misplaced, shall immediately notify the Secretary of the Exchange,
who shall thereupon have the matter investigated. (08/01/94)
332.04 Records of Floor Traders - Each member executing transactions on the
Floor of the Exchange for his or her personal account [Type 1 trades as defined
in CFTC Regulation 1.35(e)] must execute such transactions on the Floor of the
Exchange using pre-printed sequentially pre-numbered trading cards. A new
trading card must be used at the beginning of each time bracket as designated in
Regulation 332.02.
Each member must record the transactions in exact chronological order of
execution on sequential lines of the trading card (no lines may be skipped).
Provided, however, that if lines remain after the last execution recorded on a
trading card, the remaining lines must be marked through. All transactions
which are recorded on a single trading card must be recorded on the same side of
such trading card. No more than six transactions may be recorded on each
trading card.
The trading cards must contain pre-printed member identification which will
include, but will not be limited to, the trading acronym and the full name of
the member. The trading cards must also contain preprinted bracket
designations. (01/01/96)
332.041 Accountability of Trading Cards - Each member executing transactions
on the Floor of the Exchange, and his clearing member(s), shall establish and
maintain procedures that will assure the complete accountability of all pre-
printed sequentially pre-numbered trading cards used by such member on a daily
basis. Such trading cards must be distinguishable from other trading cards used
by the member during a one week period. (08/01/94)
332.05 Card Collection - At such times and in such manner as designated by
the Regulatory Compliance Committee, each member shall provide his clearing
member with trading documents which are relied upon for transactional
information necessary for submission to the clearing system
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containing those trades that have been executed thus far during that day.
Trading documents include trading cards of members' personal and proprietary
trades, trading cards of one member reflecting trades of another member (CTI 3
pursuant to CFTC Regulation 1.35 (e)) and floor order tickets.
A member may correct any errors on trading documents by crossing out erroneous
information without obliterating or otherwise making illegible any of the
originally recorded information. Alternatively, with regard to trading cards
only, a member may correct any errors by rewriting the trading card. However,
if a trading card is rewritten to correct erroneous information, the member
shall provide his clearing member with the top ply of the original trading card,
or in the absence of plies, the original trading card, which has been
subsequently rewritten, in accordance with the same collection schedule
designated by the Regulatory Compliance Committee for trading documents relied
upon for clearing purposes.
Following the collection of the above-stated documents, the clearing member
shall ensure that all such documents receive an Exchange-designated time stamp
upon collection. (12/01/96)
332.06 Records of Proprietary Orders - Immediately upon receipt on the Floor
of the Exchange of an order from a proprietary or house account (Type 2 trades
as defined in CFTC Regulation 1.35(e)) each member or registered eligible
business organization shall prepare a written record of the order. It shall be
dated and time stamped when the order is received and shall show the account
designation.
Such written records of proprietary orders of both clearing and non-clearing
member firms need not be prepared if the members executing such transactions on
the Floor of the Exchange are employed by such member firms and meet the
recordkeeping requirements set forth in Regulation 332.04. However, such
members must register with the Exchange and may not trade for their personal
accounts. The executing members may record proprietary orders in this manner if
they have initiated such orders, or if their employing firm has placed
proprietary orders with them for execution. (10/01/00)
332.07 Accountability of Trading Documents - A member is accountable for all
documents used in the execution of trades, including trading cards used for his
personal account and other documents used by the member in the execution of
trades made for others.
Floor brokers who record flashed order executions on broker cards must record on
the broker card, the corresponding clearing firm number and order ticket number
for every flashed order execution. In addition, floor brokers who record
flashed order executions on broker cards must use non-erasable ink and may
correct any errors by crossing out the erroneous information without
obliterating or otherwise making illegible any of the originally recorded
information. (12/01/96)
332.08 CTR Recordkeeping and Data Entry Requirements - Pursuant to
Regulations 332.02, 332.04, 332.041, 332.05, 332.06 and 332.07 and 332.09, each
member and member firm shall keep, in an accurate and complete manner, all books
and records required to be made or maintained under the Rules and Regulations
regarding submission of data to the Exchange or the Clearing Corporation for CTR
purposes. All trade data submissions must be done in a correct and timely
manner.
Trade data includes, but is not limited to, the time bracket, executing broker,
opposite broker, transaction type, customer type indicator ("CTI") code [as
defined in CFTC Regulation 1.35 (e)], trade timing and trade sequencing
information.
If the member executing the trade does not provide the required data to the
clearing member, the clearing member shall enter "?" as the designation when
submitting the record of such transaction to the Clearing House. If the trade
cannot clear without the specific information, it is the clearing firm's
obligation to enter a "?" designation and to obtain promptly from the member who
executed the trade the complete and correct information concerning the trade.
(08/01/94)
332.09 Member Trading for Another Member on the Trading Floor -
(a) At the time of execution, every order, which is not reduced to writing, that
a member receives from another member who is present on the trading floor
must be recorded. The member executing the order must record the time of
execution to the nearest minute on the trading card or other document used
to record the trade and must return this card or document to the initiating
member.
A member placing a verbal order, except for orders involving options-futures
combinations and other spread trades where the initiating member personally
executes at least one leg of the spread,
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shall simultaneously make a written record of the order and record the time
of placement to the nearest minute. The order and the time shall be recorded
on the member's trading card, which shall be in sequence with other trading
cards used by that member. The trading card used to record the placement of
the verbal order and the trading card or document used to record the
execution of the order must be submitted together to the clearing member by
the member placing the order or designated representative in accordance with
the collection schedule established by the Exchange.
(b) Every written order that is initiated by a member for his own account while
on the Exchange floor must be dated and time stamped upon transmission for
execution, and when returned or, in the case of an arbitrage or a flashed
transaction, when confirmed or cancelled. (08/01/94)
332.10 Prohibition of Trading or Placing Verbal or Flashed Orders from the
Clerks Step in Financial Futures and Options Contracts - Any Exchange member who
performs the functions of a floor clerk or broker assistant who also stands in
the area designated for broker assistants in any financial future or option pit
which is clearly defined as the area behind the top step is prohibited from
placing verbal orders or flashed orders for his personal account while standing
in that location. Such members are also prohibited from executing trades while
standing in this location. For the purposes of this Regulation, trading is
defined as executing trades for one's personal account, an account of another
member or a customer. Such members may only enter orders for their personal
accounts by placing such orders through the normal customer order flow process
which requires that the member leave the pit to place an order. (07/01/97)
333.00 Trades of Non-Clearing Members -
(a) PRIMARY CLEARING MEMBER. Each non-clearing member who executes trades on
Change must have one and only one Primary Clearing Member who will accept
and clear the member's personal trades. A written authorization must be on
file with the Member Services Department authorizing such non-clearing
member, without qualification, to submit trades through such Primary
Clearing Member, and designating such clearing member as the non-clearing
member's Primary Clearing Member. Such Primary Clearing Member acts as
Commission merchant for the non-clearing member. Such Primary Clearing
Member, acting as commission merchant, shall be liable upon all trades made
by the non-clearing member for the account of the Primary Clearing Member
(unless authorization is revoked as provided in (c) below) and shall be a
party to all disputes arising from trades between the authorized non-
clearing member and another member or member firm made for the account of
the Primary Clearing Member.
(b) OTHER CLEARING MEMBERS. A non-clearing member may have one or more clearing
members, in addition to his Primary Clearing Member, through whom he may
also clear his trades, provided he has written permission to do so from his
Primary Clearing Member. However, as provided in Rule 252.00, such clearing
member's claims shall be subordinated to the claims of the Primary Clearing
Member(s). Such written permission of the Primary Clearing Member must be
filed with the Member Services Department. Written authorization from the
other clearing member, authorizing the nonclearing member to make trades on
Change for the account of the clearing member, must also be filed with the
Member Services Department. Thereafter, such clearing member acting as
commission merchant, shall be liable upon all trades made by the non-
clearing member for the account of the clearing member (unless authorization
is revoked as provided for in (c) below) and shall be a party to all
disputes arising from trades between the authorized non-clearing member and
another member or member firm made for the account of the clearing member.
Notwithstanding the above, a non-clearing member may only obtain clearing
authorization for transactions entered through the e-cbot system from a
single clearing member in accordance with 9B.08.
(c) REVOCATION OF AUTHORIZATION. A revocation of authorization, either by a
Primary Clearing Member or another clearing member, must, to be effective,
be in writing and be posted by the Secretary upon the bulletin board of the
Exchange. A non-clearing member whose Primary Clearing Member has revoked
authorization shall be denied access to the Floor until another clearing
member has designated itself as the non-clearing member's Primary Clearing
Member, pursuant to (a) above. Revocation of a non-clearing member's
authorization to execute transactions through the e-cbot system shall be in
accordance with 9B.08.
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(d) The non-clearing member will not be permitted to submit a new primary
clearing member authorization or clear trades through a new primary clearing
member until such time as the former primary clearing member files a release
with the Member Services Department. A primary clearing member who has
revoked primary clearing member status to a non-clearing member must give
the non-clearing member release upon the non-clearing member's request when
the non-clearing member has obtained a new primary clearing member unless
(1) the non-clearing member has current debts related to the conduct of
business as a broker, trader or commission merchant at the primary clearing
member equal to or greater than the amount specified in Rule 286.00; or (2)
the clearing member is the guarantor under an existing valid guarantee of a
loan which had been made to the non-clearing member exclusively for the
purpose of financing the purchase of the non-clearing member's membership,
such guarantee in an amount equal to or greater than the amount specified in
Rule 286.00.
(e) PRIORITY OF DEBTS FOR PURPOSES OF RULE 252.00. Upon transfer of the non-
clearing member's membership, any indebtedness owed to a former Primary
Clearing Member at the time of revocation which was incurred subsequent to
authorization and which continues to be owed such former Primary Clearing
Member(s) shall be paid in the chronological order of revocation (oldest
debt first), in the manner and to the extent allowed under Rule 252.00. 204
(09/01/00)
333.01 Error Accounts -
(a) Each non-clearing member who acts as a floor broker or is registered with
the Commodity Futures Trading Commission or a registered futures association
as a floor broker (i) shall maintain a personal account with his Primary
Clearing Member into which he places brokerage errors; (ii) may maintain
personal error accounts at one or more secondary clearing members, in
addition to his Primary Clearing Member, provided he has written permission
to do so from his Primary Clearing Member on file with Member Services
Department.
(b) Each clearing member who carries an error account agrees to accept and clear
the broker's trades involving brokerage errors. A written authorization must
be filed with the Member Services Department authorizing the broker, without
qualification, to submit trades involving brokerage errors through such
clearing member. Such clearing member shall be liable upon all trades
involving brokerage errors that are submitted to the error account (unless
authorization is revoked as provided herein) and shall be a party to all
disputes involving trades between the broker, in his capacity as a broker,
and another member or member firm that may ultimately be submitted to the
error account. Revocation of authorization granted pursuant to this
Regulation must be filed in writing with the Member Services Department and
will become effective when written notice thereof is posted on the Exchange
bulletin board by the Secretary. (08/01/94)
333.02 Primary Clearing Members' Membership File Review - Before a clearing
member grants Primary Clearing Member authorization to any individual pursuant
to Rule 333.00 a duly authorized representative of such clearing member must:
a) review such individual's membership file as maintained by the Association;
and
b) confirm, in writing, to the Department of Member Services of the
Association, that this review was conducted.
The written confirmation referenced above will be on a form prescribed by the
Association and will be retained by the Association in the applicable individual
membership file. (08/01/94)
333.03 Funds in Trading Accounts Carried by Clearing Members - The following
shall apply to trading accounts which are carried for non-clearing members by
clearing members pursuant to Rule 333.00:
(a) If a non-clearing member trades in excess of written limits prescribed by
the carrying clearing member, and/or if the non-clearing member is alleged
to have engaged in reckless and unbusinesslike dealing inconsistent with
just and equitable principles of trade, the disposition of any and all funds
in the applicable trading accounts(s) may be suspended by the carrying
clearing member, or by the Association through the Board of Directors,
Executive Committee, Floor Governors Committee or Arbitration Executive
Committee pending a determination by the Arbitration Committee regarding the
appropriateness of the non-clearing member's conduct.
Ch3 Floor Practices
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Any Arbitration Committee decision to release trading account funds to the
non-clearing member shall include the payment of interest by the clearing
member to the non-clearing member as determined by the Arbitration
Committee.
(b) Either the carrying clearing member or the Association may direct that the
disposition of trading account funds be suspended pursuant to subparagraph
a) of this regulation. However, if such suspension is initiated by the
clearing member the suspension will be subject to review within one business
day by the Board or one of the Committees designated in paragraph (a). The
purpose of this review will be determine if sufficient grounds exist to
warrant continuation of the suspension pending a final determination by the
Arbitration Committee. Association proceedings in this regard will be
conducted in accordance with Regulation 540.60 "Procedures for Member
Responsibility Actions". (05/01/94)
334.00 Trades of Non-Clearing Members - (See 431.00) (08/01/94)
335.00 Bids and Offers in Commodities Subject to First Acceptance - Any offer
made on Change to buy or sell any commodity for future delivery is subject to
immediate acceptance by any other member. All such offers shall be general
offers and shall not be specified for acceptance by particular members. 254
(08/01/94)
336.00 Bids and Offers in Commodities Subject to Partial Acceptance - If an
offer is made on Change (the Exchange) to buy or sell any specified quantity of
any commodity for future delivery, such offer shall be deemed an offer to buy or
sell all or any part of such specified quantity and, if not immediately accepted
for the entire quantity, it may be accepted for a quantity less than specified.
Orders or offers to buy or sell a specified quantity or none shall not be
allowed, except as specifically provided in Regulation 331.03. 255 (07/01/00)
336.01 Guaranteeing Terms of Execution - Any member or member firm who
receives an order to buy or sell a futures contract or option on a futures
contract for execution on the Exchange is prohibited from directly or indirectly
guaranteeing the execution of the order or any of its terms such as the quantity
or price. A member may only report an execution that has occurred as a result of
open outcry or has been effected through an Exchange approved automated order
entry facility.
This regulation shall not be construed to prevent a member or member firm from
assuming or sharing in the losses resulting from an error or mishandling of an
order. (08/01/94)
337.01 Orders Involving Cancellations Accepted on a 'Not Held' Basis - All
orders involving cancellations that reach the Trading Floor 10 minutes or less
before the opening or resumption of the market, as applicable and all orders
involving cancellations that reach the Trading Floor 10 minutes or less before
the close of the market may involve extraordinary problems and hence will be
accepted solely at the risk of the customer on a 'not held' basis.
All orders must be received by the floor broker within a reasonable time prior
to the opening, the resumption or the close of the market, as applicable. Such
other orders not received by the floor broker within a reasonable time prior to
the opening, the resumption or the close of the market will be accepted solely
at the risk of the customer on a 'not held' basis. 1847 (09/01/98)
350.00 Trade Checking Penalties - (See 563.00) (08/01/94)
350.01 Failure to Check Trades - If any member, firm or corporation is unable
with diligent effort to check any future delivery transaction made with another
member, firm or corporation, then such transaction shall be closed out for the
account of whom it may concern by the member, firm or corporation claiming the
contract at the earliest reasonable opportunity in order to establish any claim
for loss because of such failure to check by the other party to the contract.
1811 (08/01/94)
350.02 Responsibility For Customer Orders - A floor broker or clearing member
shall exercise due diligence in the handling and execution of customer orders.
The Exchange's Arbitration Committee is authorized to determine whether a broker
or clearing firm fulfilled their obligations and whether an adjustment is due to
the customer. The Committee may consider the nature of the order and existing
market conditions, including the existence of a "FAST" market, at the time the
broker or clearing member acted or failed to act. However, a "FAST" designation
does not nullify or reduce the
Ch3 Floor Practices
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obligations of the floor broker to execute orders with due diligence according
to the terms of the order.
Except in instances where there has been a finding of willful or wanton
misconduct, in which case the party found to have engaged in such conduct cannot
avail itself of the protections in this provision, neither floor brokers nor
member firms, or other persons acting as agents nor any of their officers,
directors or employees, shall be liable for any loss, damage or cost (including
attorney's fees and court costs), whether direct, indirect, special, incidental,
consequential, lost profits or otherwise of any kind, regardless or whether any
of them has been advised or is otherwise aware of the possibility of such
damages, arising out of the use or performance of the CBOT's Electronic Order
Routing System, any component(s) thereof, or any fault, failure, malfunction or
other alleged defect in the Electronic Order Routing System, including any
inability to enter or cancel orders, or any fault in delivery, delay, omission,
suspension, inaccuracy or termination, or any other cause in connection with the
furnishing, performance, maintenance, use of or inability to use all or any part
of the Electronic Order Routing System, including but not limited to, any
failure or delay in transmission of orders or loss of orders resulting from
malfunction of the Electronic Order Routing System, disruption of common carrier
lines, loss of power, acts or failures to act of any third party, natural
disasters or any and all other causes.
The foregoing shall apply regardless of whether a claim arises in contract,
tort, negligence, strict liability or otherwise. The foregoing limitations are
cumulative and shall not limit or restrict the applicability or any other
limitation or any rule, regulation or bylaw of the Exchange or the Clearing
House. The foregoing shall not limit the liability of any floor broker or
member firms, or other person acting as agent or any of their respective
officers, directors or employees for any act, incident, or occurrence within
their control.
If any of the foregoing limits on the liability of the floor brokers or member
firms or other persons acting as agents or any of their officers, directors or
employees should be deemed to be invalid, ineffective, or unenforceable and a
customer sustains a loss, damage or cost (including attorney's fees and court
costs) resulting from use of the Electronic Order Routing System, the entire
liability of the floor brokers or member firms and their agents or any of their
officers, directors or employees shall not exceed the brokerage commissions and
any other charges actually paid by the customer.
Notwithstanding any of the foregoing provisions, this provision shall in no way
limit the applicability of any provision of the Commodity Exchange Act, as
amended, and Regulations, thereunder. (01/01/99)
350.03 Identification of Floor Trading Personnel and Floor Traders - Every
member is required to wear an identification badge issued by the Association in
a prominent position and in proper fashion to be admitted to the Trading Floor
and must so wear the badge at all times while he is on the Trading Floor.
Failure to wear a badge shall be considered an act detrimental to the welfare of
the Association (Rule 504.00). 1955 (08/01/94)
350.04 Outtrades and Errors and Mishandling of Orders -
A. Outrades - If a floor broker discovers, either intraday or interday, that
all or some portion of a customer order was executed but cannot be cleared, the
broker shall do one of the following:
1. Re-execute the order in the market and adjust the customer by check if
the re-execution price is worse than the original execution price. If
the re-execution price is better than the original execution price, the
customer is entitled to the better price.
2. Assign the opposite side of the portion that cannot be cleared to his
or her error account and assign a fill to the customer at the execution
price. The floor broker shall not liquidate the assigned position until
at least ten minutes have elapsed after the execution of the order
giving rise to the outtrade and, in any event, after the bracket period
in which the outtrade arose has ended. These liquidation restrictions
shall not apply to a liquidation during a Modified Closing Call. Any
profits resulting from the liquidation of the assigned position belong
to the floor broker, and may be retained or disbursed to whomever he
chooses, in his discretion.
A floor broker may not use the assignment process to clear unfilled or
underfilled orders, orders that were
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erroneously executed in the wrong contract month, strike price, put vs. call or
side of the market, or price outtrades.
B. Errors and Mishandling of Orders - If a broker fails to execute an order in
accordance with its instructions, or underbuys or undersells on an order, and
the order, or the remainder of the order, is subsequently filled at a better
price, then the customer is entitled to the better price. The customer is also
entitled to an adjustment if he incurs a loss because of the delay in execution.
However, if a broker overbuys or oversells on an order, the customer is not
entitled to any of the excess.
A position that has been established in an erroneous or mishandled attempt to
execute a customer order must be placed in the error account of the broker or
firm responsible for the error or mishandling. When an order has been
executed in the wrong contract month or strike price, and the erroneous
transaction has been placed in the broker's or firm's error account, the error
may be corrected by a spread transaction, in accordance with Regulation
352.01. Any profits resulting from the liquidation of the trades placed in a
broker's or firm's error account belong to the relevant broker or firm, and
may be retained or disbursed to whomever they choose at their discretion.
(10/01/99)
350.05 Floor Practices - The following acts are detrimental to the welfare of
the Association:
(a) for a floor broker to purchase any commodity for future delivery, purchase
any call commodity option or sell any put commodity option for his own
account, or for any account in which he has an interest, or for those
accounts falling within the exception of paragraph (c) of this Regulation,
while holding an order of another person for the purchase of any future,
purchase of any call commodity option, or sale of any put commodity option,
in the same commodity which is executable at the market price or at the
price at which such purchase or sale can be made for the member's own
account or the account in which he has an interest, or for those accounts
falling within the exception of paragraph (c) of this Regulation.
(b) for a floor broker to sell any commodity for future delivery, sell any call
commodity option or purchase any put commodity option for his own account,
or for any account in which he had an interest, or for those accounts
falling within the exception of paragraph (c) of this Regulation, while
holding an order of another person for the sale of any future, sale of any
call commodity option, or purchase of any put commodity option in the same
commodity which is executable at the market price or at the price at which
such sale or purchase can be made for the member's own account or the
account in which he has an interest, or for those accounts falling within
the exception of paragraph (c) of this Regulation;
(c) for a floor broker to execute a transaction in the trading pit for an
account over which he has discretionary trading authority.
The above restriction shall not apply to:
1. transactions for another member of the Exchange;
2. transactions for members of the floor broker's family which include;
spouse, parent, child, grandparent, grandchild, brother, sister,
uncle, aunt, nephew, niece, or inlaw;
3. transactions for proprietary accounts of member firms.
(d) for a member to disclose at any time that he is holding an order of another
person or to divulge any order revealed to him by reason of his relationship
to such other person, except pursuant to paragraph (c) of this Regulation,
in the legitimate course of business or at the request of an authorized
representative of the Exchange or of the Commission; the mere statement of
opinions or indications of the price at which a market may open or resume
trading does not constitute a violation of the Association's Rules and
Regulations; however, nothing herein shall alter or waive a member's
responsibility to comply with existing provisions of the Commodity Exchange
Act, Commission Rules, and the Rules and Regulations of the Association;
furthermore, it shall be a violation of this Regulation for any individual
to solicit or induce a member to disclose order information in a manner
prohibited by this Regulation;
(e) for a member to take, directly or indirectly, the other side of any order of
another person revealed to him by reason of his relationship to such other
person, except with such other person's prior consent and in conformity with
Exchange rules or except for transactions done in accordance with
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Regulation 350.04 to resolve bonafide outtrades;
(f) for a member to make any purchase or sale which has been pre-arranged;
(g) for a member to withhold or withdraw from the market any order or part of an
order of another person for the convenience of another member;
(h) for a member to execute any order after the closing bell is sounded except
in a call market close;
(i) for a member to buy and sell as an accommodation at any time or, except as
specifically provided in Regulations 331.03, 331.04 and 350.10, to use one
order to fill another order, or any part thereof;
(j) for parties to a transaction to fail to properly notify the pit recorder of
the price at which trades have been consummated;
(k) for a floor broker to allocate executions of orders in any manner other than
an equitable manner.
(l) for a member to initiate during the same trading session a transaction for
future delivery in a CBOE 50 or CBOE 250 Stock Index future(s) for his or
her own account, or for any account in which he or she has an interest, or
for the account of his or her family including spouse, parents, children,
grandparents, grandchildren, brothers, sisters, uncles, aunts, nephews,
nieces and in-laws, and to execute as a floor broker any order for future
delivery in a CBOE 50 or CBOE 250 Stock Index future(s). This restriction
shall not apply to any transaction made by the member to offset a
transaction made in error by the same floor member. (07/01/00)
350.06 Give-Ups - A member must have prior permission from a clearing member
to give-up its name for a trade executed on the Exchange. For give-up orders,
the executing clearing member must first clear the trade and then transfer it in
accordance with Regulation 444.01(f). A floor broker is prohibited from giving
up in the pit a name other than the executing clearing member placing the order.
Give-up orders are prohibited when used as a pricing mechanism in connection
with cash market contracts. Pricing in connection with cash market contracts
must be done only on a versus-cash basis pursuant to the requirements of
Regulation 444.01. (11/01/97)
350.07 Checking and Recording Trades - Members must within fifteen minutes
after each transaction confirm with the opposite member trader every execution
of a futures transaction with respect to executing member, price, quantity,
commodity, future and respective clearing members. Members must within fifteen
minutes after each transaction confirm with the opposite member trader every
execution of an options transaction with respect to executing member, premium,
quantity, option series, and respective clearing members. Each record of
transactions must show the relevant foregoing information and also must include
and clearly identify the date and appropriate time bracket, and the opposite
executing member.
In addition, each member who, on the Floor of the Exchange receives a customer's
or options customer's order which is not in the form of a written record
including the account identification, order number and date and time, to the
nearest minute, such order was received on the floor of the Exchange, shall
immediately upon receipt thereof prepare a written record of such order,
including the account identification and order number, and shall record thereon
the date and time, to the nearest minute, such order is received.
Non-erasable ink must be used to record all such information. (11/01/94)
350.08 Notification of Unchecked Trades - Any clearing firm that is unable
with diligent effort to check a transaction with another member, shall notify
the floor member who executed the transaction. Such notice shall be given prior
to the following day's Regular Trading Hours opening or resumption, as
applicable. In the case of agricultural contracts, such notice shall be given no
later than twenty minutes prior to the following day's opening or resumption, as
applicable.
In all cases, such notice shall be given in sufficient time as to allow the
floor member to make provisions for any adjustment. In the case of agricultural
contracts, the floor member will have resolved his trades by no later than
twenty minutes prior to the relevant opening or resumption, as applicable.
The opening range or resumption range, as applicable, of the following day's
Regular Trading Hours
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market shall be the limit of liability as a result of an unchecked trade.
(09/01/98)
350.10 Exemption for Certain Joint Venture Products - Notwithstanding any
other provisions of these Rules and Regulations, a member who simultaneously
holds orders on behalf of different principals to buy and sell any of the inter-
regulatory or intermarket spreads designated below, may execute such spread
orders for and directly between principals; provided that the member shall first
offer such spread orders competitively by open outcry in the open market (a) by
both bidding and offering at the same price, and neither such bid nor offer is
accepted or (b) by bidding and offering to a point where such offer is higher
than such bid by not more than the minimum permissible price fluctuation
applicable to such spread orders and neither such bid nor offer is accepted. If
any such order is not accepted within a reasonable amount of time, then the
member may, execute such order for and directly between the principals. The
following requirements must also be met in the execution of such spread orders:
(1) The member who executes such order must do so in the presence of a Chicago
Board Options Exchange Floor Official, who is a member qualified to trade
Joint Venture futures contracts.
(2) Such member shall clearly identify all such spreads on his trading card or
similar record by appropriate symbol or descriptive words and shall note on
such card or record the exact time of execution. Such member shall thereupon
promptly present said card or record to the Floor Official for verification
and initialing.
(3) No futures commission merchant or floor broker who receives any of the
inter-regulatory or intermarket spread orders designated below from another
person shall take the other side of such spread orders, except with such
other person's prior consent.
This Regulation applies to the following spread strategies:
(a) inter-regulatory strategies involving a CBOE 50 and/or CBOE 250 Stock Index
future(s) spread against a Standard and Poor's 100 and/or Standard and
Poor's 500 option(s) traded on the Chicago Board Options Exchange;
(b) intermarket futures spreads involving a CBOE 50 Stock Index future(s) spread
against a CBOE 250 Stock Index future(s); or
(c) any other inter-regulatory or intermarket spread designated under this
Regulation by the Board of Directors of the Association. (08/01/94)
350.11 Resolution of Outtrades - Outtrades shall be resolved by issuing a
check in an amount agreed to by the members making the trade(s).
A. Price Outtrades
When an outtrade exists due to a discrepancy as to price, members making the
trade may choose to resolve the discrepancy by electing either of the two prices
in question, if they agree that the trade was executed at that price.
If an outtrade involves a price discrepancy between a local and a broker, and
the members cannot agree on the price of execution, the price recorded by the
broker shall be used to clear the trade. Any adjustments shall then be made by
check, in compliance with this Regulation.
If an outtrade between locals or an outtrade between brokers involves a price
discrepancy, and these members cannot agree on the price of execution, the
buyer's price shall be used to clear the trade. Any adjustments shall then be
made by check, in compliance with this Regulation.
B. Quantity Outtrades
When an outtrade exists due to a discrepancy as to quantity, members making the
trade may choose to resolve the discrepancy by electing either of the two
quantities in question, if they agree that the trade was executed in that
quantity.
If any outtrade between locals involves a quantity discrepancy and these members
cannot agree on the quantity that was executed, the higher quantity shall be
used to clear the trade. Any adjustments shall then be made by check, in
compliance with this Regulation.
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A broker may assign the opposite side of any excess quantity on his order, which
he believes that he has executed, to his error account, pursuant to Regulation
350.04, and he may agree to the clearing of the transaction according to the
quantity recorded by the other member, whether the other member was a broker or
a local.
C. Bona Fide Contract Month, Strike, Put vs. Call and Side of Market (Buy vs.
Buy or Sell vs. Sell) Outtrades
When an outtrade exists due to a discrepancy as to the contract month, strike
price, whether an option trade involved a put or a call, or side of the market,
and any party who executed a customer order believes that the order has been
executed in accordance with its instructions, the outtrade may be resolved in
any one of the following ways:
1. The trade may be busted. If a broker re-executes his order, any losses
incurred by the customer as a result of the delay in execution must be
adjusted by check. If the order is executed at a more favorable price,
the customer is entitled to the better price.
2. The members making the trades(s) may agree that either trade or both
trades may be cleared in accordance with the members' recorded trade
data.
3. A broker may assign the opposite side of his own order to his error
account, pursuant to Regulation 350.04, and he may agree to the
clearing of the transaction according to the terms of the other
member's recorded trade data, whether the other member was a broker or
a local.
4. If both members were brokers, they may both assign their respective
trades to their error accounts, pursuant to Regulation 350.04.
A customer shall not be entitled to any portion of any profits realized by a
local who was on the opposite side of an outtrade between the local and the
customer's broker, as a result of the local's liquidation of his position. Such
profits belong to the local, and may be retained or disbursed to whomever he
chooses, in his discretion. If the local chooses to disburse any portion of
such profits to the broker, and the broker's customer has received a fill in
accordance with the broker's recorded trade data, the broker is not obligated to
offer such profits to this customer.
It shall be an offense against the Association for members to prearrange a trade
to reconcile an outtrade.
Nothing herein shall in any way limit a member's right to submit an outtrade to
Exchange arbitration if an outtrade cannot be resolved by agreement. (10/01/99)
352.01 Spreading Transactions - A spread transaction involving options, or
the purchase and sale of different futures, at a price or yield difference or
simultaneously at a separate price for each side of the spread is permitted on
this Exchange provided:
1. that each side of the spread (the purchase of one future and the sale of
another future) is for the same account, or in the case of spreads in
options, all sides are for the same account. Provided that, when an order
has been executed in the wrong month, wrong strike price or wrong commodity,
and the erroneous transaction has been placed in the broker's or firm's
error account, the error may be corrected by a spread transaction in which
one leg of the spread offsets the position in the error account and the
other leg is the correct execution of the order. Provided further that the
liability of the floor broker or FCM shall be determined in accordance with
Regulation 350.04.
2. that all sides of the spread are priced at prices within the daily trading
limits specified in Regulation 1008.01;
3. that the spread is offered by public outcry in the pit assigned to the
commodity(ies) or option(s) involved.
4. that the transaction shall be reported, recorded and publicized as a spread
in the ratio in which it was executed.
5. that when such transactions are executed simultaneously, the executing
member on each side of
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the transaction shall designate each part of the trade as a spread on his
cards by an appropriate word or symbol clearly identifying each part of such
transaction.
6. that for options the spreads must conform to one of the following
definitions, any multiple or combination of these strategies, or any
generally accepted relationship between options and the underlying futures,
including but not limited to:
a. Vertical and Horizontal Spreads. Short one call (put) and long another
call (put) with a different strike price and/or expiration month.
b. Straddles. Short (long) puts and calls in a generally accepted spread
ratio.
c. Conversions and Reverse Conversions. Short (long) calls, long (short)
puts, and long (short) futures in a generally accepted spread ratio.
d. Butterflies. Two vertical spreads which share one common strike price.
e. Boxes. Long a call and short a put at one strike price and short a call
and long a put at another strike price.
f. Synthetic Straddles. Long (short) futures and short (long) calls or long
(short) puts in a generally accepted spread ratio.
g. Ratio Spreads. Long calls (puts) and short calls (puts) in a generally
accepted spread ratio.
h. Ratio Writes. Short calls (puts) and long (short) futures in a generally
accepted spread ratio.
i. Ratio Purchases. Long calls (puts) and short (long) futures in a
generally accepted spread ratio.
j. Synthetic Futures. Long calls (puts) and short puts (calls) in a
generally accepted spread ratio.
7. that in executing a ratio spread, a member shall bid or offer by open outcry
either both the spread portion at a price difference and the remaining
portion (i.e., the "tails") at a specific price for each, or the entire
ratio spread at a separate price for each side of the transaction. A ratio
spread and if applicable each part of it must be executed competitively by
open outcry in accordance with this regulation and Rule 332.00. A bid or
offer for a ratio spread is subject to partial acceptance in ratioed units
in accordance with Rule 336.00.
8. that for spread transactions at a yield difference the following conditions
are met:
a. one side of the spread is a yield-based futures contract, i.e. where the
final contract settlement price is calculated by subtracting a yield
measurement from 100.
b. the sides are priced at the price spread implied by the yield spread.
c. the prices for Short, Medium, and Long Term U.S. Treasury Note and U.S.
Treasury Bond futures are those implied for 8% coupon, semi-annual non-
amortizing instruments with exactly two, five, ten, and twenty years
remaining maturity as calculated and published by the Exchange.
d. the prices for the yield-based futures contracts are calculated by
subtracting the yield from 100.
e. the yields are quoted in increments no smaller than one half basis
point.
f. the Regulatory Compliance Committee has designated the spread for
trading on a yield basis.
Brokers may not couple separate orders and execute them as a spread, nor may a
broker take one part of a spread for his own account and give the other part to
a customer on an order. (08/01/00)
352.01A Unacceptable Spread Orders - Certain orders that involve the trading
of different contracts, when the contracts involved are traded in different
designated trading pits and when the resulting positions do not offset to reduce
economic risk, do not represent legitimate spreading transactions and are
specifically deemed to be unacceptable orders. Such transactions must be
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executed on separate orders in the respective designated trading areas. The
foregoing provisions apply to, but are not limited to, the following examples:
There are separate trading pits for options and futures. An order to buy a
put (or sell a call) and sell the underlying future establishes a short
position only, and therefore there is no offsetting feature. An order to
sell a put (or buy a call) and buy the underlying future establishes a long
position only, and therefore there is no offsetting feature. These orders
are unacceptable as spread orders. (08/01/94)
352.02 Joint Venture Intermarket and Inter-Regulatory Spreads - -
Notwithstanding any other provisions of these Rules and Regulations to the
contrary, the following principles shall apply to spreading transactions
involving Joint Venture Products.
1. Futures spreads involving CBOE 50 and/or CBOE 250 Stock Index futures
contracts may be bid or offered at a differential and if so bid or offered,
such spreads may not be separated into their individual components.
2. Inter-Regulatory spread strategies involving CBOE 50 or CBOE 250 Stock Index
futures spread against Standard and Poor's 100 or Standard and Poor's 500
options traded on the Chicago Board Options Exchange ("CBOE") may be bid or
offered at a differential. If such spreads are bid or offered at a
differential, they may not be separated into individual parts. The futures
side of such spreads must be priced within the daily quotation range. The
price of the options side of such spreads shall not touch the best bid or
offer contained in the CBOE order book but may touch but shall not go
through the current best bid or offer prevailing in the trading crowd. The
prices for both sides of such spreads shall be disseminated immediately and
shall be identified as a spread. The price differential shall also be
disseminated immediately.
3. Inter-Regulatory spreads involving CBOE 50 and/or CBOE 250 Stock Index
futures contracts spread against Standard and Poor's 100 and/or Standard and
Poor's 500 options may be executed in any location in the Standard and
Poor's 100 or the Standard and Poor's 500 option pit(s).
4. Joint Venture inter-regulatory or intermarket spreads may not be used to
establish opening prices for Joint Venture futures contracts. (08/01/94)
360.01 Pit Supervisory and Enforcement Authority of the Respective Pit
Committees - It shall be the function and duty of the Pit Committees to
supervise and enforce decorum and trading etiquette within their respective
trading pits.
I. Supervision and Enforcement of Pit Decorum
Each Pit Committee shall have the authority over its respective pit to
discipline any individual who has committed a decorum offense within the
pit, as set forth in Rule 519.00, by the imposition of a fine not to exceed
$5,000.00
Pit Committee members shall issue a ticket to the offender notifying the
offender that the Pit Committee has imposed a warning or designated fine in
accordance with the following schedule guidelines:
[Download Table]
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1st offense Warning or fine between
$250.00 - $2,500.00
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2nd offense and subsequent offenses Fine between $500.00 -
$5,000.00
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Any Exchange member may request that the Pit Committee issue a ticket;
however, the Pit Committee Chairman or Vice-Chairman or in the alternative,
a member of the Floor Governors Committee, must sign and thereby authorize
each and every ticket issued by the Pit Committee. Any ticket not
authorized by the Pit Committee Chairman or Vice-Chairman, or in the
alternative, a member of the Floor Governors Committee, will be deemed to be
invalid.
The recipient of a Pit Committee ticket may either pay the corresponding
fine or request a summary hearing before the respective Pit Committee to
contest the ticket. The summary hearing shall be held after the close of
trading on the afternoon of the day the ticket was issued or as soon
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as possible thereafter. The attendance of either a simple majority or five
members of the respective Pit Committee, whichever is less, shall constitute
a quorum for the purpose of a summary hearing.
Application of Regulations - The Chairman, Vice-Chairman, or Pit Committee
Member who initiated a ticket may not sit on
the panel; however, he may participate at the
hearing as a witness. The Chairman or Vice-
Chairman who simply authorized, but did not
initiate the ticket, may sit on the panel
that hears the matter.
No member of the summary hearing panel may have a direct financial or
personal interest in the outcome of the matter.
If a ticket was issued by the Pit Committee at the request of a member, the
requesting member must appear at the summary hearing. If the requesting
member fails to appear, the ticket will be voided. Furthermore, the
requesting individual's failure to appear may be deemed to constitute an act
detrimental to the welfare of the Association.
Members may not be represented by an attorney at the summary hearing.
The decision of the summary hearing panel shall be final; however, a member
shall have a limited right to appeal the decision to the Exchange's
Appellate Committee on the grounds that the decision was:
a. In excess of the summary hearing panel's authority, jurisdiction, or
limitations; or
b. Without observance of the required procedures.
Any member or individual with floor access privileges who has received a Pit
Committee ticket for a decorum offense of Disorderly Conduct, Intentional
Physical Abuse, Sexual Harassment, and/or Use of Profane or Obscene Language
and during the same trading session, engages in a further Rule or Regulation
violation relating to Disorderly Conduct, Intentional Physical Abuse, Sexual
Harassment, and/or Use of Profane or Obscene Language may, in addition to
other sanctions (including but not limited to fines, suspensions, and
expulsions imposed by the Association pursuant to the Rules and
Regulations), be immediately and summarily removed from the Exchange trading
floor and denied trading floor access for the remainder of the trading
session pursuant to the following procedures:
a. Certification by a Chairman of the Pit Committee (or, in the Chairman's
absence, by a Vice-Chairman of the Pit Committee) that the individual
has continued to engage in Disorderly Conduct, Intentional Physical
Abuse, Sexual Harassment, and/or Use of Profane or Obscene Language
after having previously received a Pit Committee ticket for the same
offense in the same trading session; and
b. Approval of such summary action by a member of the Floor Governors
Committee and a member of the Board of Directors or by two members of
the Board of Directors, provided that no individual granting such
approval shall have been involved in the altercation.
Additionally, should the first such offense be of such a serious nature, the
individual may be denied trading floor access for the duration of the trading
session pursuant to the above procedure.
II. Supervision and Enforcement of Pit Trading Etiquette
Each Pit Committee shall have the authority over its respective pit to issue
a ticket to any member who has allegedly violated the pit's trading
etiquette. Each pit, by and through its Pit Committee, shall be responsible
for determining the nature and extent of its pit trading etiquette.
However, the Floor Governors Committee will be responsible for standardizing
the pit trading etiquette that is common to all of the Exchange's trading
pits.
A breach of trading etiquette does not in itself constitute a specific
violation of an Exchange Rule or Exchange Regulation. However, any
particularly egregious violation of a trading etiquette or repeated
violation of trading etiquette may result in disciplinary action by the
Floor Governors Committee pursuant to the general provisions of Exchange
Rule 500.00 (Inequitable Proceedings) and/or Rule 504.00 (Acts Detrimental
to the Welfare of the Association).
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Any member may request that a ticket be issued and any member of the
respective Pit Committee may issue a ticket. However, the Pit Committee
Chairman or Vice-Chairman must sign and thereby authorize each ticket.
If the recipient of a ticket wishes to contest the ticket he shall
immediately notify the Chairman or Vice-Chairman of the Pit Committee and a
summary hearing shall be held by the Pit Committee after the close of that
day's trading, or as soon as possible thereafter.
The purpose of the hearing will be for the Pit Committee, to determine by
majority vote, whether the ticket should stand or whether the ticket should
be voided.
The attendance of either a simple majority or five members, whichever is
less, shall constitute a Pit Committee Hearing Panel quorum.
No member of the Pit Committee Hearing Panel may have a financial or
personal interest in the matter.
The Chairman, Vice-Chairman or Pit Committee Member who initiated a ticket
may not sit on the panel, however, he may participate at the hearing as a
witness. The Chairman or Vice-Chairman who simply authorized, but did not
initiate the ticket, may sit on the panel that hears the matter.
Failure of the member who requested the ticket to appear will result in the
ticket being voided, and the failure to appear may constitute an act
detrimental to the Association.
Members may not be represented by an attorney at a hearing.
Staff will not be present during any hearing, except at the specific
request of the Pit Committee.
Decisions of the panel will be final. Respondents will not be able to
appeal the panel's decision.
If a member reaches a total of any three violations (all pits inclusive),
within six months, the member shall be automatically referred to Floor
Governors for possible disciplinary action pursuant to Rule 500.00 and/or
Rule 504.00. However, a pit committee may, at its discretion, refer any
single offense committed within its respective pit to the Floor Governors
Committee. A simple majority of the pit committee shall be required before
a single offense may be referred to the Floor Governors Committee.
A ticket will expire and be expunged from any and all records after twelve
months from the date of the ticket's issuance unless the ticket has been
referred to Floor Governors Committee. In the event that a ticket has been
referred to Floor Governors Committee, the ticket will expire and be
expunged from the records only after the Floor Governors Committee decides
not to pursue formal charges.
Tickets referred to the Floor Governors Committee will serve as the basis
of O.I.A's investigation, and the tickets may be submitted as evidence in
support of O.I.A.'s case before the Floor Governors Committee. However,
O.I.A. will conduct its own separate and distinct investigation of the
matter.
III. Pit Committee Grievance Meetings
On a monthly basis, or more frequently as needed, each Pit Committee shall
convene and hold an informal grievance meeting. The purpose of the informal
grievance meetings will be to:
a. review and discuss general issues relating to pit etiquette and pit
trading practices;
b. formulate and submit to the Floor Governors Committee recommendations
for trading standards;
c. review and consider specific complaints relating to pit etiquette and
pit trading practices; and
d. determine by simple majority whether to recommend that the Floor
Governors Committee investigate specific instances of pit etiquette
and pit trading practices that the Pit Committee believes may be
inequitable.
The Pit Committees shall conduct and determine the time, location, manner
and form of their
Ch3 Floor Practices
-------------------
respective Pit Committee Grievance Meetings. Staff will not be present
during any Pit Committee Grievance Meeting, except at the specific request
of the Pit Committee. (01/01/00)
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Chapter 4
Futures Commission Merchant
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Ch4 General....................................................................................................
400.00 Commission Merchant............................................................................
401.00 Corporations and Partnerships..................................................................
401.01 Partnerships and Corporations..................................................................
401.02 Registration of Membership for Corporation.....................................................
401.03 Registration of Membership for Partnership.....................................................
402.00 Business Conduct Committee.....................................................................
403.00 Testimony and Production of Books and Papers...................................................
403.01 Approval of Customer Accounts..................................................................
403.02 Financial Questionnaire........................................................................
403.03 Audits.........................................................................................
403.04 Reduction of Capital...........................................................................
403.05 Restrictions on Operations.....................................................................
403.07 Financial Requirements.........................................................................
403.08 Expulsion from a Designated Contract Market....................................................
404.00 Advertising....................................................................................
405.00 Trade Checking Penalties.......................................................................
Ch4 Customer Accounts..........................................................................................
414.00 Trades of Non-Clearing Members.................................................................
415.00 Trades of Non-Clearing Members.................................................................
416.01 Correspondent Accounts.........................................................................
416.02 Members Responsible for Correspondents.........................................................
416.02A Correspondents.................................................................................
416.04 Correspondent Accounts.........................................................................
416.05 Limitations On Acceptance of Agent Business....................................................
417.01 Notice and Processing of Transfer of Accounts..................................................
418.01 Non-Members' Accounts..........................................................................
419.00 Trading for Employees..........................................................................
420.00 Trading by Employees...........................................................................
420.01 Gratuities.....................................................................................
420.01A Elective Officers and Non-Member Directors.....................................................
421.00 Confirmation to Customers......................................................................
421.01 Confirmations..................................................................................
421.02 Options Confirmations..........................................................................
421.03 Average Price Orders...........................................................................
421.05 Allocation of Exercise Notices.................................................................
422.00 Investment Company Accounts....................................................................
423.00 Discretionary Orders...........................................................................
423.01 Discretionary Accounts.........................................................................
423.01B Discretionary Trading..........................................................................
423.02 Presumption That Trades Are Pursuant to Discretionary Authority................................
423.03 Supervision of Discretionary Trading by Employees..............................................
423.04 Customer Orders During Concurrent Sessions.....................................................
Ch4 Position Limits and Reportable Positions...................................................................
425.01 Position Limits................................................................................
425.02 Bona Fide Hedging Positions....................................................................
425.03 Reporting Requirements For Bona Fide or Economically Appropriate
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425.04 Hedging Positions in Futures in Excess of Limits.................................................
425.05 Exemptions From Position Limits..................................................................
425.06 Exemption from Aggregation for Position Limit Purposes...........................................
425.07 Position Accountability for U.S. Treasury Bonds..................................................
425.08 Position Accountability for Long-Term and Medium-Term Treasury Notes.............................
430.00 Position Accountability for 30-Day Fed Funds Futures.............................................
431.00 Deposits by Customers............................................................................
431.00A Margins..........................................................................................
431.01 Permit Holder Interpretation.....................................................................
431.02 Margins - Non-Clearing Members...................................................................
431.02A Margin Requirements..............................................................................
431.03 Hedging Transactions.............................................................................
431.03A Margin on Futures................................................................................
431.03B Margins..........................................................................................
431.04 Margins..........................................................................................
431.05 Notice of Undermargined Omnibus Accounts.........................................................
431.06 Margin on Options................................................................................
432.00 Margin on Options - Non-Clearing Members.........................................................
433.00 Customers' Securities............................................................................
433.01 Agreement for Use of Securities..................................................................
Construction of Rules 432.00 and 433.00..........................................................
Ch4 Transfer Trades/Exchange Service Fees........................................................................
443.00 Exempt Transactions..............................................................................
444.01 Transfer Trades; Exchange of Futures for Physicals and Give-up
Transactions.....................................................................................
444.01A Transfer Trades and Inter-Market Spreads.........................................................
444.01B Prohibition on Exchange of Futures for Cash Commodities Involving
Multi-Parties....................................................................................
444.02 Clearance of Exchanges of Futures for Physicals Transactions.....................................
444.03 Transfer Trades in a Delivery Month..............................................................
450.00 Exchange Service Fees............................................................................
450.01 Exchange Service Fees............................................................................
450.01A Exchange Service Fees............................................................................
450.01B Options Transactions.............................................................................
450.01C Exchange Service Fees............................................................................
450.02 Member's Own Account and Member Firm's Account...................................................
450.03 Exchange Service Fees for Professional Trading Firms.............................................
450.04 Exchange Service Fees - Adjustments..............................................................
450.05 Fees.............................................................................................
Ch4 Adjustments..................................................................................................
460.01 Errors and Mishandling of Orders.................................................................
460.02 Checking and Reporting Trades....................................................................
460.03 Failure to Check Trades..........................................................................
460.04 Price of Execution Binding.......................................................................
Ch4 Customer Orders..............................................................................................
465.01 Records of Customers' Orders.....................................................................
465.02 Application and Closing Out of Offsetting Long and Short Positions...............................
465.02A Exchange's No Position Stance on FCM's Internal Bookkeeping Procedures...........................
465.03 Orders and Cancellations Accepted On A 'Not Held' Basis..........................................
465.04 Records of Floor Order Forms.....................................................................
465.05 Floor Order Forms................................................................................
465.06 Broker's Copy of Floor Orders....................................................................
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465.07 Designation of Order Number Sequences........................................................
465.08 Post-Execution Allocation....................................................................
466.00 Orders Must be Executed in the Public Market.................................................
Ch4 Offices and Branch Offices...............................................................................
475.00 Offices and Branch Offices...................................................................
Ch4 APs and Other Employees..................................................................................
480.01 APs..........................................................................................
480.02 Employers Responsible for APs................................................................
480.09 Other Employees..............................................................................
480.10 Supervision..................................................................................
Ch4 Options Transactions.....................................................................................
490.00 Application of Rules and Regulations.........................................................
490.02 Option Customer Complaints...................................................................
490.03 Supervision Procedures.......................................................................
490.03A Introducing Brokers Guaranteed by Member FCMs/Supervision Procedures.........................
490.05 Disclosure...................................................................................
490.06 Promotional Material.........................................................................
490.07 Sales Communication..........................................................................
490.09 Reports by Commission Merchants..............................................................
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Chapter 4
Futures Commission Merchant
================================================================================
Ch4 General
400.00 Commission Merchant - A member who makes a trade, either for another
member or for a non-member, but who makes the trade in his own name and becomes
liable as principal as between himself and the other party to the trade. 13
(08/01/94)
401.00 Corporations and Partnerships - (See 230.00) (08/01/94)
401.01 Partnerships and Corporations - Trading Authority-(See 230.01)
(08/01/94)
401.02 Registration of Membership for Corporation - (See 230.02) (08/01/94)
401.03 Registration of Membership for Partnership - (See 230.06) (08/01/94)
402.00 Business Conduct Committee - (See 542.00) (08/01/94)
403.00 Testimony and Production of Books and Papers - (See 545.00) (08/01/94)
403.01 Approval of Customer Accounts - No firm or any of its wholly-owned
affiliates shall carry customer accounts without prior approval obtained either
at the time of registration under Regulation 230.02 or 230.06 or prior to change
in the nature of business previously authorized. In order to originate and carry
on a business with public customers, a firm is subject to the minimum capital
requirements established by the Financial Compliance Committee.
No member sole proprietorship shall carry customer accounts without prior
approval. A member requesting approval to carry customer accounts shall submit
a certified financial report of the sole proprietorship, prepared by an
independent Certified Public Accountant as of a date which is no more than 90
days prior to the date of submission. In order to originate and carry on a
business with public customers, a sole proprietorship is subject to the minimum
capital requirements established by the Financial Compliance Committee. 1780
(08/01/94)
403.02 Financial Questionnaire - (See 285.01) (08/01/94)
403.03 Audits - (See 285.02) (08/01/94)
403.04 Reduction of Capital - (See 285.03) (08/01/94)
403.05 Restrictions on Operations - (See 285.04) (08/01/94)
403.07 Financial Requirements - (See 285.05) (04/01/97)
403.08 Expulsion from a Designated Contract Market - Upon review of the
decision or record which resulted in a person or a firm's expulsion from
membership in, or the privileges of membership on, any recognized domestic or
foreign board of trade or securities exchange, should the Board of Directors
find that there exists a demonstrable connection between the type of conduct
which resulted in the expulsion and the protection afforded the Exchange, its
members and customers through a trading prohibition against the expelled
individual or firm, the Board may direct that no member or member firm may carry
any account, accept an order, or handle a transaction, relating to futures
contracts or options on futures contracts traded on the Exchange, for or on
behalf of such expelled person or firm. Such an order may by modified or revoked
by a vote of two-thirds of the Directors. (08/01/94)
404.00 Advertising - (See 287.00) (08/01/94)
405.00 Trade Checking Penalties - (See 563.00) (08/01/94)
Ch4 Customer Accounts
414.00 Trades of Non-Clearing Members - (See 286.00) and (See 431.00)
(08/01/94)
415.00 Trades of Non-Clearing Members - (See 333.00) (08/01/94)
416.01 Correspondent Accounts - Each registered eligible business
organization must maintain a complete listing of all correspondent accounts
carried on its books. Such list shall be promptly provided to authorized
representatives of the Association. Information for each correspondent account
must include name and address, classification of the account as customer or
house, regulated or non-regulated. 1780A (04/01/98)
416.02 Members Responsible for Correspondents - Members doing business with
correspondents must keep themselves well informed regarding their financial
standing and shall immediately report to the Secretary any information that does
in any way indicate that a correspondent is insolvent, or threatened with
insolvency, or guilty of any irregularities or practices affecting the good name
of the Association. 1043 (08/01/94)
416.02A Correspondents - In May, 1935, the Rules Committee ruled that the word
"correspondents" as it is used in Regulation 416.02 means the following:
1. A correspondent, under the provisions of Regulation 170.07 is a person,
firm or corporation (member or non-member) transacting a banking or a
brokerage business connected by telephone or telegraphic wire or
wireless connection with the office of a member.
2. A non-clearing member who solicits and turns over security or future
delivery orders to a clearing member for execution, is a correspondent
of the clearing member whether or not his office is connected by
telephonic, telegraphic wire connections to that of the clearing member.
3. Under the provisions of Regulation 416.02, any member doing business
with correspondents has the responsibilities therein outlined. 17R
(08/01/94)
416.04 Correspondent Accounts - Consistent with its duties under Rule 542.00,
the Business Conduct Committee may require that the identities and positions of
the beneficial owners of any correspondent account be immediately disclosed to
the Business Conduct Committee or to authorized representatives of the
Association. If disclosure is not provided and the Business Conduct Committee
determines that such failure to provide information is an impediment to the
Committee in the discharge of its duties under Rule 542.00, appropriate summary
action may be ordered up to and including immediate liquidation of all or a
portion of the positions in the correspondent account. Any such summary action
shall be taken in accordance with the procedures set forth in Regulation 540.06.
(08/01/94)
416.05 Limitations On Acceptance of Agent Business - No member FCM shall
solicit or accept any options order for execution on the Exchange which has been
solicited, accepted or serviced by any person who is not registered as an
associated person of such member FCM. Provided, however, that at such time as
any futures association registered under Section 17 of the Commodity Exchange
Act has determined to provide for the regulation of the options-related activity
of its members in a manner equivalent to that required of contract markets by
the Commission, any FCM member of such futures association may solicit or accept
options orders for execution on the Exchange in the same manner as FCMs which
are members of the Exchange.
Further, no member FCM may solicit or accept options orders from any person whom
it has reason to believe may be soliciting options orders in contravention of
this Regulation or Regulation 33.3 or the Commission. (08/01/94)
417.01 Notice and Processing of Transfer of Accounts - When a commission
merchant goes out of business, or closes one or more offices, or withdraws
ordinary facilities for transacting business from one or more offices, the
following shall apply:
Upon the transfer of customer accounts in commodity futures contracts by a
member or registered eligible business organization, to any other futures
commission merchant (member or non-member), the transferor shall immediately
give written notice of the transfer to the Secretary of the Association. Such
written shall notice shall contain: (1) the name and address of the transferee;
(2) the date of the transfer; (3) the number of customer accounts; (4) the net
equity of customer funds, and (5) a statement certified by the member, or by a
general partner or executive officer whose membership is registered for the
transferor, that (a) the transferor has provided prior notice of the transfer to
each customer whose account is thus transferred and (b) the transfer has been
preceded by reasonable investigation of the transferee by the transferor and
that the transferee is a suitable recipient of the transferred accounts.
Upon the transfer of customer accounts by a non-member of the Association, to
any member or registered eligible business organization, the transferee shall
immediately notify the Secretary in writing that such transfer has occurred and
such written notice shall identify the transferor, the date of transfer, the
number of customer accounts, and the net equity of customer funds being
transferred to such member or registered eligible business organization.
A member or registered eligible business organization, acting as a transferor or
transferee, must be able to facilitate a bulk transfer of accounts by use of an
automated system as prescribed by the Association.
This regulation applies to all transfers of customer accounts involving members
or registered eligible business organizations, who or which are closing
facilities unless they are initiated at the unsolicited request of the
customers. 1809C (04/01/98)
418.01 Non-Members' Accounts - When a non-clearing member has trading
authority over a non-members account carried on a disclosed basis he shall so
inform the clearing member carrying the account.
Non-clearing members may be permitted to carry both omnibus and disclosed
accounts with clearing members provided that when the non-clearing member used
both types of accounts, he shall guarantee the clearing member carrying any
disclosed accounts against any loss in such accounts.
The non-clearing member must notify the carrying member that he is carrying both
omnibus and disclosed accounts. 1819 (08/01/94)
419.00 Trading for Employees - No member shall accept orders or clear trades
for a non-member who is employed by another member nor shall another member
accept orders or clear trades for a member who is employed by another member
when the name of the employer appears in the transaction. 205 (08/01/94)
420.00 Trading by Employees - No member shall accept marginal accounts of any
employee, whether member or non-member, of the Association or of the Clearing
House or of another member unless written consent of the employer be first
obtained. 206 (08/01/94)
420.01 Gratuities - (See 206.02) (08/01/94)
420.01A Elective Officers and Non-Member Directors - For purposes of Rule
420.00, Elective Officers and non-member Directors of the Association shall not
be considered employees of the Association. (08/01/94)
421.00 Confirmation to Customers - A commission merchant who makes a trade
for a member or non-member customer shall confirm the trade to the customer no
later than the business day following the day upon which the transaction was
consummated. Such confirmation shall be in writing and shall show the commodity
or security bought or sold, the amount, the price, and the name of the other
party to the contract, and, in the case of a commodity, the delivery month. A
non-resident member may give to his customer the name of his resident commission
merchant in lieu of the name of the other party to the contract, subject to the
right of the customer to receive the name of the other party to the contract
upon request.
Where a trade is made by a branch office of a resident member, such branch
office being outside of Illinois, the branch office may confirm the trade to the
customer without giving the name of the other party to the contract, provided
the confirmation has prominently printed or stamped thereon the words, "Name of
other party to contract furnished on request." 207 (08/01/94)
421.01 Confirmations - A confirmation of a commission merchant to the
customer need not contain the name of the other party to the contract, provided
the confirmation has prominently printed or stamped thereon the words, "name of
other party to contract furnished on request." 1845 (08/01/94)
421.02 Options Confirmations -
(a) A commission merchant who makes an options trade for a member or
non-member customer shall confirm the trade to the customer no later
than the business day following the day upon which the transaction was
consummated. Such confirmation shall be in writing and shall indicate
the customer's account identification number; a separate listing of the
amount of the premium and all other commissions, costs and fees; the
option series; the expiration date; and the date of the transaction.
(b) In addition, upon the expiration or exercise of any commodity option,
each commission merchant must furnish to each customer holding any such
option which has expired or been exercised, not later than the next
business day, a written confirmation statement which shall include the
date of such occurrence, a description of the option involved, and in
the case of exercise, the details of the futures position which resulted
therefrom.
(c) Notwithstanding paragraphs (a) and (b) of this Regulation, a commodity
options transaction that is executed for a commodity pool (investment
company) need be confirmed only to the operator of the commodity pool.
(d) With respect to any account controlled by any person other than the
customer for whom the account is carried, each commission merchant shall
promptly furnish in writing to such other person the information set
forth in paragraphs (a) and (b) of this Regulation. (08/01/94)
421.03 Average Price Orders - Member firms may confirm to customers an
average price when multiple execution prices are received on an order or series
of orders for futures, options or combination transactions. An order or series
of orders executed during a trading session at more than one price may only be
averaged pursuant to this regulation if each order is for the same account or
group of accounts and for the same commodity and month for futures, or for the
same commodity, month, put/call and strike for options.
Any member or member firm that accepts an order pursuant to this regulation must
comply with requirements of this regulation and all order recordation
requirements.
Upon receipt of an execution at multiple prices for the order subject to this
regulation, an average price will be computed by multiplying the execution
prices by the quantities at those prices divided by the total quantities. An
average price for a series of orders will be computed based on the average
prices of each order in that series.
Each Clearing firm that confirms to a customer an average price, must indicate
on the confirmation and monthly statement that the price is not an execution
price. (04/01/00)
421.05 Allocation of Exercise Notices - The Clearing House, in an equitable,
random manner, shall assign exercise notices tendered by options purchasers to
clearing members holding open short options positions; and each clearing member
and commission merchant, in an equitable, random or proportional manner, shall
assign exercise notices it receives on behalf of customer accounts to such
customer accounts holding open short options positions. (08/01/94)
422.00 Investment Company Accounts - (See 507.00) (08/01/94)
423.00 Discretionary Orders - No member or registered eligible business
organization shall permit any employee, whether member or non-member, to
exercise discretion in the handling of any transaction for a customer for
execution on this Exchange, unless prior written authorization for the exercise
of such
discretion has been received. A discretionary order is defined as an order that
lacks any of the following elements: the commodity, year and delivery month of
the contract, number of contracts, and whether the order is to buy or sell.
All partners of a registered partnership, all managers and members of a
registered limited liability company and all officers of a registered
corporation, shall be considered employees of their firm or corporation for
purposes of these discretionary rules and regulations. 151 (04/01/98)
423.01 Discretionary Accounts - It shall be a violation of this regulation
for any member or registered eligible business organization
1. To accept or carry an account over which the member or employee thereof
exercises trading authority or control for another person in whose name
the account is carried, without-
a. obtaining a signed copy of the Power of Attorney, trading
authorization, or other document by which such trading authority or
control is given;
b. sending direct to the person in whose name the account is carried a
written confirmation of each trade as provided in Rule 421.00 and a
monthly statement showing the exact position of the account,
including all open trades figured to the market; and
c. reflecting the discretionary nature of the account on all statements
sent to the account owner.
2. To accept or carry an account over which any third party individual or
organization other than the person in whose name the account is carried
exercises trading authority or control, without-
a. obtaining a signed copy of the Power of Attorney, trading
authorization, or other document by which such trading authority or
control is given; and
b. obtaining a written acknowledgment from the person in whose name the
account is carried that he has received a copy of the account
controller's disclosure document, prepared pursuant to CFTC
Regulation 4.31, or a written statement explaining why the account
controller is not required to provide a disclosure document to the
customer.
(The above acknowledgement of paragraph b. need not be obtained (i) when
the person in whose name the account is carried and the individual given
trading authority or control are of the same family; or (ii) when the
person given trading authority or control is (A) a member, (B) an officer,
partner, member, manager or managerial employee of the eligible business
organization carrying the account; (C) a bank or trust company organized
under federal or state laws or (D) an insurance company regulated under
the laws of any state; or (iii) when the account is carried in the name of
(A) an employee benefit plan subject to ERISA or organized under the laws
of any state (B) an investment company registered under the Investment
Company Act of 1940, (C) a bank or trust company organized under federal
or state law, (D) an insurance company regulated under the laws of any
state; or (E) an exempt organization, as defined in section 501 (c) (3) of
the Internal Revenue Code, with net assets of more than $100 million.)
3. To accept or carry the account of a non-member who has given trading
authority to a member unless the member carrying the account requires that
all orders entered for the account be executed by an individual or
individuals other than the member to whom such trading authority is given.
This requirement shall not apply where the non-member customer and the
member having such trading authority are of the same family. This
Regulation shall only apply to open outcry Regular and open outcry Night
Trading Hours.
4. For purposes of this Regulation, a person does not exercise trading
authority or control if the person in whose name the account is carried or
the account controller specifies (1) the precise commodity interest to be
purchased or sold, and (2) the exact amount of the commodity interest to
be purchased or sold. Provided the foregoing provisions are met, the
provisions of this Regulation shall not apply to discretion as to the
price at which or the time when an order shall be executed.
The provisions of this Regulation relate only to transactions executed on this
Exchange. 1990 (04/01/98)
423.01B Discretionary Trading - The increasing utilization of trading by
programmed
recommendations, whether by computer, charts or by any means, has brought
several questions to the Rules Committee regarding discretion. These methods
tend to create situations requiring the use of discretion and the Rules
Committee recommends that member firms treat all such accounts as discretionary
accounts unless the member can be certain that the customer(s) has given
specific instructions, including price limits and any subsequent price changes
relative to orders placed in connection with such trading.
In connection with the above, your attention is called to Rule 423.00 and
Regulations 423.01 through 423.03 all having to do with the handling of
discretionary accounts. 41R (08/01/94)
423.02 Presumption That Trades Are Pursuant to Discretionary Authority -Every
trade in an account over which any individual or organization other than the
person in whose name the account is carried exercises trading authority or
control shall be rebuttably presumed to have been made pursuant to such trading
authority or control. The Power of Attorney, trading authorization or other
document by which any individual or organization other than the person in whose
name an account is carried exercises trading authority or control over such
account can be terminated only by a written revocation signed by the person in
whose name the account is carried; by the death of the person in whose name the
account is carried; or, where the individual or organization that exercises
authority or control over the account is the member carrying the account or an
employee thereof, by written notification from the member to the person in whose
name the account is held that such member will no longer act pursuant to such
trading authorization as of the date provided in the notice. 1991 (08/01/94)
423.03 Supervision of Discretionary Trading by Employees - A Power of
Attorney or trading authorization signed by the customer and naming the employee
to whom trading authority is given will be considered written authorization of
the customer with respect to any discretionary transaction handled by such
employee pursuant to such Power of Attorney or trading authorization.
Each account with respect to which an employee has discretionary authority must
be given daily supervision by the employer, or by a partner or officer or such
other person designated as a compliance officer if the employer is an eligible
business organization, to see that trading in such account is not excessive in
size or frequency in relation to financial resources in that account. The
provisions of this paragraph shall not apply where only one employee of an
eligible business organization member firm has discretionary authority if that
individual is also the only principal who supervises futures trading activity.
No employee who has not been registered for a minimum of two continuous years as
an Associated Person (AP) under CFTC Regulations may exercise the discretion
permitted by Rule 423.00. The foregoing requirement may be waived in particular
cases by the Business Conduct Committee upon a showing by the applicant of
experience equivalent to such a two-year registration. 1992 (04/01/98)
423.04 Customer Orders During Concurrent Sessions - For orders involving
concurrently traded contracts, the customer will designate whether the order is
to be executed in the open outcry market or on e-cbot. (09/01/00)
Ch4 Position Limits and Reportable Positions
425.01 Position Limits -
(a) For the purposes of this Regulation, the following are definitions of titles
used in position limit chart-
Spot Month- Spot month futures-equivalent position limit net long or net
short effective at the start of trading on the first business day prior to
the first trading day of the spot month.
Single Month- Futures-equivalent position limit net long or net short in
any one month other than the spot month.
All Months -Position limit net long or net short in all months and all
strike prices combined. Note: Long futures contracts, long call options,
and short put options are considered to be on the long side of the market
while short futures contracts, long put options, and short call options are
considered to be on the short side of the market. For each commodity, the
futures-equivalents for both the options and futures contracts are
aggregated to determine compliance with the net long or net short same side
position limits.
Reportable Futures Level-Reportable futures position in any one month.
Reportable Options Level-Reportable options position in any one month in
each option category. Note:0ption categories are long call, long put, short
call, and short put.
Net Equivalent Futures Position-Each option contract has been adjusted by
the prior day's risk factor, or delta coefficient, for that option which
has been calculated by the Board of Trade Clearing Corporation.
For the purpose of this Regulation:
(i) An option contract's futures-equivalency shall be based on the prior
day's delta factor for the option series, as published by the Board
of Trade Clearing Corporation. For example, 8 long put contracts,
each with a delta factor of 0.5, would equal 4 futures-equivalent
short contracts.
(ii) Long futures contracts shall have a delta factor of +1, and short
futures contracts shall have a delta factor of -1.
(iii) Long call options and short put options shall have positive delta
factors.
(iv) Short call options and long put options shall have negative delta
factors.
(v) An eligible option/option or option/futures spread is defined as an
intra-month or inter-month position in the same Chicago Board of
Trade commodity in which the sum of the delta factors is zero.
(b) Except as provided in Regulations 425.03, 425.04 and 425.05, the maximum
positions which any person may own, control, or carry are as follows:
(Note: All position limits and reportable positions are in number of contracts
and are based on futures or *Net Equivalent Futures Positions.
*Please see section (a) of this Regulation for definition.
[Enlarge/Download Table]
----------------------------------------------------------------------------------------------------------------------
*SPOT *SINGLE *ALL *REPORTABLE *REPORTABLE
CONTRACT MONTH MONTH MONTH FUTURES LEVEL OPTIONS LEVEL
----------------------------------------------------------------------------------------------------------------------
Long Term Fannie Mae(R) 5,000 None 5,000 100 50
Benchmark Notes(sm) and Freddie
Mac Reference Notes(sm)
(see#14)
----------------------------------------------------------------------------------------------------------------------
Medium Term Fannie Mae(R) 5,000 None 5,000 100 50
Benchmark Notes(sm) and Freddie
Mac Reference Notes(sm)
(see#14)
----------------------------------------------------------------------------------------------------------------------
CBOT Dow Jones Industrial
Average(sm) Index None None 50,000 25 25
----------------------------------------------------------------------------------------------------------------------
CBOT Dow Jones Transportation
Average(sm) Index None None 2,800 25
----------------------------------------------------------------------------------------------------------------------
CBOT Dow Jones Utility
Average(sm) Index None None 4,000 25
----------------------------------------------------------------------------------------------------------------------
CBOT Dow Jones Composite
Average(sm) Index None None 70,000 25
----------------------------------------------------------------------------------------------------------------------
1,000 oz. Silver 5,000 None 20,000 500 50
(see#1) (see#1)
----------------------------------------------------------------------------------------------------------------------
5,000 oz. Silver 1,000 None 4,000 100
(see#1) (see#1)
----------------------------------------------------------------------------------------------------------------------
Kilo Gold 6,000 None 12,000 200
(see#2) (see#2)
----------------------------------------------------------------------------------------------------------------------
100 oz. Gold 2,000 None 4,000 200
(see#2) (see#2)
----------------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds None None None 500 100
----------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes (5yr.) None None None 300 50
----------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes (6 1/2-10yr.) None None None 500 50
----------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes (2yr.) 5,000 None 5,000 200 50
----------------------------------------------------------------------------------------------------------------------
30 Day Fed Fund None None None 100
----------------------------------------------------------------------------------------------------------------------
Long Term Municipal Bond Index 4,000 None 5,000 100 50
(see#13)
----------------------------------------------------------------------------------------------------------------------
Corn 600 5,500 9,000 150 50
(see#3) (see#3,5)
----------------------------------------------------------------------------------------------------------------------
Soybeans 600 3,500 5,500 100 50
(see#3) (see#3,6)
----------------------------------------------------------------------------------------------------------------------
Wheat 600 3,000 4,000 100 50
(see#12) (see#3) (see#3,9)
----------------------------------------------------------------------------------------------------------------------
Oats 600 1,000 1,500 60 50
(see#3) (see#3,8)
----------------------------------------------------------------------------------------------------------------------
Rough Rice 250 500 750 50 50
(see#7) (see#4)
----------------------------------------------------------------------------------------------------------------------
[Enlarge/Download Table]
---------------------------------------------------------------------------------------------------------------------
Soybean Oil 540 3,000 4,000 175 50
(see#3,9) (see#3,9)
---------------------------------------------------------------------------------------------------------------------
Soybean Meal 720 3,000 4,000 175 50
(see#3,9) (see#3,9)
---------------------------------------------------------------------------------------------------------------------
Corn Yield Insurance 1,000 1,000 1,000 25 25
(see#10)
---------------------------------------------------------------------------------------------------------------------
PCS Catastrophe Insurance N/A N/A N/A N/A 25
(see#11)
---------------------------------------------------------------------------------------------------------------------
#1 See subsection (h) for an explanation of adjusted limits for persons owning
or controlling joint positions in 1,000 oz. Silver and 5,000 oz. Silver
contracts.
#2 See subsection (i) for an explanation of adjusted limits for persons owning
or controlling joint positions in Kilo Gold and 100 oz. Gold contracts.
#3 Additional futures contracts may be held outside of the spot month as part of
futures/futures spreads within a crop year provided that the total of such
positions, when combined with outright positions, do not exceed the all months
combined limit. In addition, a person may own or control additional options in
excess of the futures-equivalent limits provided that those option contracts in
excess of the futures-equivalent limits are part of an eligible option/futures
spread.
#4 No more than 500 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined. Additional
options contracts may be held as part of option/options or option/futures
spreads between months within the same crop year provided that the total of such
positions, when combined with outright positions, does not exceed the all months
combined limit. The futures-equivalents for both the options and futures
contracts are aggregated to determine compliance with these net same side single
month position limits.
#5 No more that 5,500 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined. Additional
options contracts may be held as part of option/option or option/futures spreads
between months within the same crop year provided that the total of such
positions, when combined with outright positions, does not exceed the all months
combined limit. The futures-equivalents for both the options and futures
contracts are aggregated to determine compliance with these net same side single
month position limits.
#6 No more that 3,500 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined. Additional
options contracts may be held as part of option/option or option/futures spreads
between months within the same crop year provided that the total of such
positions, when combined with outright positions, does not exceed the all months
combined limit. The futures-equivalents for both the options and futures
contracts are aggregated to determined compliance with these net same side
single month position limits.
#7 On and after the first notice day of the expiring futures month of July, the
limit for the July futures month will be reduced to 200 contracts, for both
hedging and speculative positions.
#8 No more than 1,000 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined. Additional
options contracts may be held as part of option/option or option/futures spreads
between months within the same crop year provided that the total of such
positions, when combined with outright positions, does not exceed the all months
combined limit. The futures-equivalents for both the options and futures
contracts are aggregated to determined compliance with these net same side
single month position limits.
#9 No more that 3,000 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined. Additional
options contracts may be held as part of option/option or option/futures spreads
between months within the same crop year provided that the total of such
positions, when combined with outright positions, does not exceed the all months
combined limit. The futures-equivalents for both the options and futures
contracts are aggregated to determine compliance with these net same side single
month position limits.
#10 Specifications apply separately to each of the following Corn Yield
Insurance contracts: Iowa, Illinois, Indiana, Nebraska, Ohio, U.S.
#11 Specifications apply separately to Small Cap and Large Cap contracts in each
of the following PCS Catastrophe Insurance categories: National, Eastern,
Northeastern, Southeastern, Western, Midwestern and California.
#12 In the last five trading days of the expiring futures month, the speculative
position limit for the March futures month will be 350 contracts and for the May
futures month the limit will be 220 contracts.
#13 In the last three trading days of the expiring contract, no more than a
combined 4,000 futures and/or futures-equivalent contracts net on the same side
of the market are allowed in the spot month in all strike prices combined. No
exemptions will be applicable during the last three days of trading of the
expiring spot month contract.
#14 Starting with the June 2001 listing, the Last Day of Trading will be "the
last Friday which precedes by at least two business days the last business day
of the month preceding the option month. If such a Friday is not a business
day, or there is a Friday which is a business day which precedes by one business
day the last business day of the month preceding the option month, the last day
of trading will be the business day prior to such Friday."
Except for the interest of a limited partner or shareholder (other than the
commodity pool operator) in a commodity pool, ownership, including a 10% or more
financial ownership interest, shall constitute control over an account except as
provided in Regulation 425.05.
The maximum positions which any person, as defined in Regulation 425.01 (c), may
own or control shall be as set forth herein. However, with respect to the
maximum positions which a member firm may carry for its customers, it shall not
be a violation of the limits set forth herein to carry customer positions in
excess of such limits for such reasonable period of time as the firm may require
to discover and liquidate the excess positions or file the appropriate hedge or
exemption statements for the customer accounts in question in accordance with
Regulations 425.03 and 425.04. For the purposes of this regulation, a
"reasonable period of time" shall generally not exceed one business day for
those positions that are not subject to the provisions of Regulations 425.03 and
425.04.
However, for any option position that exceeds position limits for passive
reasons such as a market move or exercise assignment, the person shall be
allowed one business day to liquidate the excess position without being
considered in violation of the limits. In addition, if at the close of trading,
an option position exceeds position limits when evaluated using the previous
day's delta factors, but does not exceed the limits when evaluated using the
delta factors for that day's close of trading, then the position shall not
constitute a position limit violation.
Note: The Commodity Futures Trading Commission has imposed speculative position
limits on Corn, Oats, Soybean, Wheat, Soybean Oil and Soybean Meal futures
contracts as provided in Part 150 of CFTC Regulations.
(c) The term "net" shall mean the long or short position held after offsetting
long futures positions against short futures positions. The word "person"
shall include individuals, associations, partnerships, limited liability
companies, corporations and trusts.
(d) The foregoing limits on positions shall not apply to bona fide hedging
positions which meet the requirements of Regulations 425.02 and 425.03, nor
to positions subject to particular limits granted pursuant to Regulation
425.04.
(e) The Board, or a Committee authorized by the Board may direct any member or
registered eligible business organization owning, controlling or carrying a
position for a person whose total position as defined in subsection (f)
below exceeds the position limits as set forth in subsection (b) above or
as specifically determined pursuant to Regulations 425.03 or 425.04 to
liquidate or otherwise reduce the position.
(f) In determining whether any person has exceeded the position limits
specified in subsection (b) of this Regulation or those limits determined
pursuant to Regulations 425.03 or 425.04, or whether a position is a
reportable position as set forth in subsections (b) and (g) herein, all
positions in accounts for which such person by power of attorney or
otherwise directly or indirectly controls trading, except as provided in
Regulation 425.05, shall be included with the positions held by such
person. Such limits upon positions shall apply to positions held by two or
more persons acting pursuant to an expressed or implied agreement or
understanding, the same as if the positions were held by a single person.
(g) If a person owns, controls or carries a position equal to or greater than
the number of contracts specified in subsection (b) above long or short in
any one month, then all such futures and options on such futures contract
owned, controlled or carried by that person, whether above the given level
or not, shall necessarily be deemed reportable positions. Every member or
registered eligible business organization shall report each and every
reportable position to the Office of Investigations and Audits at such
times and in such form and manner as shall be prescribed by the Business
Conduct Committee.
(1) On or before the first day on which any position must be reported as
provided above, the member or registered eligible business organization
carrying the position must furnish to the Office of Investigations and
Audits a report, in the form, manner and content prescribed by the
Business Conduct Committee, identifying the owner of the account for
which the position must be reported and all persons associated with the
account as described in subsection (f) above.
(2) Every member or registered eligible business organization must report
each and every reportable position and provide the report required in
subsection (1) above for each person within any account carried on an
omnibus basis, unless, upon application of the member or registered
eligible business organization to the Business Conduct Committee, the
nonmember omnibus account specifically is approved to report directly
to the Office of Investigations and Audits.
(h) In the event that a person owns or controls joint positions in 1,000 oz.
Silver futures and 5,000 oz. Silver futures, position limits will be
subject to the following:
(1) For 1,000 oz. Silver futures, the spot month maximum position limit of
5,000 contracts net long (net short) shall be reduced by five for every
one net long (net short) 5,000 oz. Silver futures position that is
owned or controlled in the spot month. In all months combined, the
maximum position limit of 20,000 contracts, net long (net short) shall
be reduced by five for every one net long (net short), 5,000 oz. Silver
futures position that is owned or controlled. Alternatively, the
maximum position limit of 20,000 contracts, net long (net short) in all
months combined, shall be increased by five for every one net short
(net long) 5,000 oz. Silver futures position that is owned or
controlled. For example, in all months combined, a person could own or
control 15,000 contracts, net long (net short), provided that the
person does not also own or control more than 1,000 net long (net
short) 5,000 oz. Silver futures positions.
(2) For 5,000 oz. Silver futures, the spot month maximum position limit of
1,000 contracts net long (net short) shall be reduced by one for every
five net long (net short) 1,000 oz. Silver futures positions that are
owned or controlled in the spot month. In all months combined, the
maximum position limit of 4,000 contracts, net long (net short) shall
be reduced by one for every five net long (net short) 1,000 oz. Silver
futures positions that are owned or controlled. Alternatively, the
maximum position limit of 4,000 contracts, net long (net short) in all
months combined, shall be increased by one for every five net short
(net long) 1,000 oz. Silver futures
positions that are owned or controlled. For example, in all months
combined, a person could own or control 3,000 contracts, net long (net
short), provided that the person does not also own or control more than
5,000 net long (net short) 1,000 oz. Silver futures positions.
(i) In the event that a person owns or controls joint positions in Kilo Gold
futures and 100 oz. Gold futures, position limits will be subject to the
following:
(1) For Kilo Gold futures, the spot month maximum position limit of 6,000
contracts net long (net short) shall be reduced by three for every one
net long (net short) 100 oz. Gold futures position that is owned or
controlled in the spot month. In all months combined, the maximum
position limit of 12,000 contracts, net long (net short) shall be
reduced by three for every one net long (net short) 100 oz. Gold
futures position that is owned or controlled. Alternatively, the
maximum position limit of 12,000 contracts, net long (net short) in all
months combined, shall be increased by three for every one net short
(net long) 100 oz. Gold futures position that is owned or controlled.
For example, in all months combined, a person could own or control
9,000 contracts, net long (net short), provided that the person does
not also own or control more than 1,000 net long (net short) 100 oz.
Gold futures positions.
(2) For 100 oz. Gold futures, the spot month maximum position limit of
2,000 contracts net long (net short) shall be reduced by one for every
three net long (net short) Kilo Gold futures position that are owned or
controlled in the spot month. In all months combined, the maximum
position limit of 4,000 contracts, net long (net short) shall be
reduced by one for every three net long (net short) Kilo Gold futures
positions that are owned or controlled. Alternatively, the maximum
position limit of 4,000 contracts, net long (net short) in all months
combined, shall be increased by one for every three net short (net
long) Kilo Gold futures positions that are owned or controlled. For
example, in all months combined, a person could own or control 3,000
contracts, net long (net short), provided that the person does not also
own or control more than 3,000 net long (net short) Kilo Gold futures
positions. (10/01/00)
425.02 Bona Fide Hedging Positions -
(a) General Definition. Bona fide or economically appropriate hedging positions
in futures or options shall mean positions in a contract or positions in
options on a contract for future delivery on this Exchange, where such
positions normally represent a substitute for positions to be taken at a
later time in a physical marketing channel, and where they are economically
appropriate to the reduction of risks in the conduct and management of a
commercial enterprise, and where they arise from:
(1) The potential change in the value of assets which a person owns,
refines or merchandises or anticipates owning, refining or
merchandising,
(2) The potential change in the value of liabilities which a person owes or
anticipates incurring, or
(3) The potential change in the value of services which a person provides,
purchases or anticipates providing or purchasing.
Notwithstanding the foregoing, no positions of a person shall be classified
as bona fide hedging unless their purpose is to offset price risks
incidental to that person's commercial cash or spot operations and such
positions are established and liquidated in an orderly manner in accordance
with sound commercial practices and unless the provisions of Regulation
425.03 have been satisfied.
(b) Enumerated Hedging Positions. For purposes of Regulation 425.03, the
definition of bona fide or economically appropriate hedging positions in
subsection (a) above includes, but is not limited to, the following specific
positions:
(1) Sales of any commodity for future delivery, purchases of any put
options on futures contracts and/or sales of any call options on
futures contracts, which do not exceed in quantity:
(i) Ownership of the same cash commodity by the same person, and
(ii) Fixed-price purchases of the same cash commodity by the same
person.
(2) Purchases of any commodity for future delivery, sales of any put
options on futures contracts and/or purchases of any call options on
futures contracts, which do not exceed in quantity:
(i) Fixed-price sales of the same cash commodity by the same person;
and
(ii) The quantity equivalent of fixed-price sales of the cash products
and derivative products of such commodity by the same person.
(3) Sales and purchases of commodities for future delivery or of options on
contracts for future delivery described in subsections (b)(1) and
(b)(2) may also be offset by the same or other quantities of a
different cash commodity, provided that the fluctuations in the value
of the position for future delivery or of the commodity underlying the
option contract are substantially related to the fluctuations in the
value of the actual cash position.
(c) Non-Enumerated Hedging Positions. The Board, or a Committee authorized by
the Board, may recognize positions other than those enumerated in subsection
(b) as bona fide or economically appropriate hedging positions, in
accordance with the general definition of bona fide or economically
appropriate hedging positions in Regulation 425.02(a), upon the filing of a
satisfactory initial statement in accordance with Regulation 425.03. Such
positions may include:
(1) Short-hedging positions (including long put options or short call
options) of unsold anticipated positions in the same cash commodity by
the same person;
(2) Long-hedging positions (including long call options or short put
options) of unfilled anticipated requirements of the same cash
commodity by the same person;
(3) Short or long cross-hedging positions, provided that the fluctuations
in the value of the positions for future delivery or the commodity
underlying the options positions are substantially related to the
fluctuations in the value of the anticipated cash positions; or
(4) Any other positions in commodities for future delivery or options on
futures contracts, including those established under the concept of
"delta-ratio hedging", under such terms and conditions as the Board, or
a Committee authorized by the Board, may specify.
(d) Cash positions described in subsections (b) and (c) above shall not include
those positions or portions of positions which are bona fide hedging
positions in futures or economically appropriate hedging positions in
options pursuant to Regulations 425.02 and 425.03.
Note: Corn, Oats, Soybean, Soybean Oil, Soybean Meal and Wheat futures
contracts are subject to Commodity Futures Trading Commission Regulation
1.3(z), which defines bona fide hedging transactions and positions.
(10/01/00)
425.03 Reporting Requirements For Bona Fide or Economically Appropriate
Hedging Positions in Excess of Limits -
(a) Initial Statement. Every member or registered eligible business
organization which owns, controls, or carries positions on behalf of a
person who seeks classification of such positions as bona fide or
economically appropriate hedging positions must file a statement
satisfactory to designated staff or a Committee authorized by the Board in
order to classify such positions as bona fide or economically appropriate
hedging positions within the meaning of Regulation 425.02. The initial
statement of the member or registered eligible business organization filed
on behalf of a person shall be filed no later than 10 business days after
the day on which the person's position exceeds the speculative limit for
each contract specified in Regulation 425.01 (a), and shall include:
(1) A description of the kinds of intended positions and their potential
size;
(2) A statement affirming that the kinds of intended positions are bona
fide or economically appropriate hedging positions; and
(3) With respect to the kinds of intended positions that are described as
non-enumerated hedging positions under Regulation 425.02(c), a
justification that the kinds of intended positions are consistent with
the definition of bona fide or economically appropriate hedging
positions within the meaning of Regulation 425.02(a).
(b) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to this
Regulation, a supplemental statement which updates and confirms previous
information shall be filed with designated staff or a Committee authorized
by the Board by every member or registered eligible business organization
owning, controlling or carrying such person's position. The supplemental
statement shall be filed no later than 10 business days after the day on
which the person's position exceeds the level specified in the most recent
statement.
(c) A Committee or designated staff authorized by the Board will monitor bona
fide or economically appropriate hedging positions. The initial and
supplemental statements prescribed in subsections (a) and (b) above must be
submitted to the Office of Investigations and Audits and shall be
maintained on a confidential basis. The Board, or a Committee or designated
staff authorized by the Board may request additional relevant information
necessary to ensure compliance with this Regulation 425.03. (10/01/00)
425.04 Exemptions From Position Limits -
(a) The Board, or a Committee authorized by the Board, may establish particular
position limits on those positions of a person normally known as "spreads,
straddles or arbitrage," including:
(1) intramarket spreads;
(2) intermarket spreads;
(3) cash-futures arbitrage, where "cash" is defined as spot or forward
positions; or
(4) eligible option/option or option/futures spreads as defined in
Regulation 425.01.
In addition, the Board or a Committee authorized by the Board, may
establish, on a case by case basis, particular maximum position limits on
certain risk management positions in interest rate, stock index and
currency futures and options, including:
(1) Long positions (futures, long calls, short puts) whose underlying
commodity value does not exceed the sum of:
(i) Cash set aside in an identifiable manner, or any of the following
unencumbered instruments so set aside, with maturities of less
than 1 year: U.S. Treasury obligations; U.S. agency discount
notes; commercial paper rated A2 or better by Standard & Poors
and P2 or better by Moody's; banker's acceptances; or
certificates of deposit, plus any funds deposited as margin on
such positions; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
(2) Long positions (futures, long calls) whose underlying commodity value
does not exceed the sum of:
(i) The value of equity securities, debt securities, or currencies
owned and being hedged by the trader holding such futures or
option position, provided that the fluctuations in value of the
position used to hedge such securities are substantially related
to the fluctuations in value of the securities themselves; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
(3) Short calls whose underlying commodity value does not exceed the sum
of:
(i) The value of securities or currencies underlying the futures
contract upon which the option is based or underlying the futures
contract upon which the option is based or underlying the option
itself and which securities or currencies are owned by the trader
holding such option position; and
(ii) The value of securities or currencies whose price fluctuations
are substantially related to the price fluctuations of the
securities or currencies underlying the futures contract upon
which the option is based or underlying the option itself and
which securities or currencies are owned by the trader holding
such option position.
Risk management positions eligible for particular position limits under
this Regulation do not include
those considered as bona fide or economically appropriate hedging positions
as defined in Regulation 425.02.
(b) Requirements for Exemptions from Position Limits. Every member or
registered eligible business organization which owns, controls or carries
positions on behalf of a person who wishes to make purchases or sales of
any commodity for future delivery or any option on a contract for future
delivery in excess of the position limits then in effect, shall file
statements on behalf of the person with the Exchange, in such form and
manner as shall be prescribed by the Board, or by a Committee authorized by
the Board, in conformity with the requirements of this subsection.
(1) Initial Statement. Initial statements concerning the classification of
positions normally known in the trade as "spreads, straddles or
arbitrage," or risk management positions, as described in subsection
(a) above, for the purpose of subjecting such positions to particular
position limits above those specified in Regulation 425.01 (a), shall
be filed with designated staff or Committee authorized by the Board no
later than 10 business days after the day on which such positions
exceed the position limits then in effect. Such statements shall
include information necessary to enable the Board, or a Committee
authorized by the Board, to make a determination that the particular
kinds of intended positions should be eligible for a higher position
limit, including, but not limited to:
(i) A description of the specific nature and size of positions for
future delivery or in options on contracts for future delivery
and offsetting cash, forward or futures positions, where
applicable, and affirmation that intended positions to be
maintained in excess of the limits set forth in Regulation 425.01
(a) will be positions as set forth in subsection (a) above; and
(ii) In the case of risk management positions, information on the cash
portfolio being managed and/or any cash or cash market
instruments held in connection with the intended risk management
position, as well as other information relevant to the conditions
specified in subsection (a) above. Of particular interest are
whether the cash market underlying the futures or option market
has a high degree of demonstrated liquidity relative to the size
of the positions, and whether there exist opportunities for
arbitrage which provide a close linkage between the cash market
and the futures or options market in question; and whether the
positions are on behalf of a commercial entity, including
parents, subsidiaries or other related entities, which typically
buys, sells or holds the underlying or a related cash market
instrument.
(2) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to
this Regulation, a supplemental statement which updates and confirms
previous information shall be filed with designated staff or a
Committee authorized by the Board by every member or registered
eligible business organization owning, controlling or carrying such
person's position. The supplemental statement shall be filed no later
than 10 business days after the day on which the person's position
exceeds the level specified in the most recent statement.
(c) A Committee or designated staff authorized by the Board will monitor the
positions maintained by persons who have obtained particular position
limits under the provisions of this Regulation. The initial and
supplemental statements prescribed in subsections (b)(1) and (b)(2) above
must be submitted to the Office of Investigations and Audits and shall be
maintained on a confidential basis. The Board, or a Committee or designated
staff authorized by the Board, may request additional relevant information
necessary to ensure compliance with this Regulation 425.04, and may, for
any good reason, amend, revoke or otherwise limit the particular position
limits established.
(d) The provisions of this Regulation 425.04 shall not apply to Corn, Oats,
Soybean, Wheat, Soybean Oil and Soybean Meal futures and options contracts
traded on the Exchange. (10/01/00)
425.05 Exemption from Aggregation for Position Limit Purposes -
(a). Positions carried for an eligible entity as defined in Commodity Futures
Trading Commission Regulation 150.1(d), in a separate account or accounts
of an independent account controller, as
defined in Commodity Futures Trading Commission Regulation 150.1(e) may
exceed the position limits set forth in Regulation 425.01 to the extent
such positions are positions not for the spot month and which are carried
for an eligible entity as defined by Commodity Futures Trading Commission
Regulation 150.1 or such other persons as the Commission deems exempt
pursuant to Regulation 150.3, in the separate account or accounts of an
independent account controller provided however, that the overall positions
held or controlled by each such independent account controller may not
exceed the limits specified in Regulation 425.01.
(b) Additional Requirements for Exemption of Affiliated Entities - If the
independent account controller is affiliated with the eligible entity or
another independent account controller, each of the affiliated entities
must:
1) Have and enforce, written procedures in place to preclude such account
controllers from having knowledge of, gaining access to, or receiving
data about, trades of other account controllers. Such procedures must
include document routing, and other procedures or security
arrangements, including separate physical locations, which would
maintain the independence of their activities provided, however, that
such procedures may provide for the disclosure of information which is
reasonably necessary for an eligible entity to maintain the level of
control consistent with the fiduciary responsibilities and necessary
to fulfill its duty to supervise diligently the trading done on its
behalf;
2) Trade such accounts pursuant to separately developed and independent
trading systems and market such trading systems separately; and
3) Solicit funds for such trading by separate Disclosure Documents that
meet the standards of Commodity Futures Trading Commission Regulation
4.21.
(c) Upon request by the Board or a Committee authorized by the Board or such
person responsible for the supervision of the Office of Investigations and
Audits, any person claiming an exemption from speculative position limits
under this Regulation must provide to the Exchange such information as
specified in the request relating to the positions owned or controlled by
that person; trading done pursuant to the claimed exemption; the futures,
options, or cash market positions which support the claim of the exemption;
and the relevant business relationships supporting a claim of exemption.
(10/01/00)
425.06 Position Accountability for U.S. Treasury Bonds - A person as defined
in Regulation 425.01(c), who owns or controls more than 10,000 U.S. Treasury
Bond futures and/or futures-equivalent contracts net long or net short in all
months and strike prices combined, or net long or net short futures contracts in
the spot month, or 25,000 option contracts for all months and all strike prices
combined in each option category as defined in Regulation 425.01 (a) shall
thereby be subject to the following provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (10/01/00)
425.07 Position Accountability for Long-Term and Medium-Term Treasury Notes -
A person as defined in Regulation 425.01(c), who owns or controls more than
7,500 Long-Term Treasury Note futures and/or futures-equivalent contracts or
more than 7,500 Medium-Term Treasury Note futures and/or futures-equivalent
contracts, net long or net short in all months and strike prices combined, or
net long or
net short futures contracts in the spot month, or 20,000 option contracts for
all months and all strike prices combined in each option category as defined in
Regulation 425.01 (a) shall thereby be subject to the following provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such person automatically shall consent, when so ordered by the Association
acting in its discretion, not to increase further the position in Long-Term
Treasury Notes or Medium-Term Treasury Notes which exceeds the above-
referenced 7,500 futures and/or futures-equivalent contracts or 20,000
option contracts level.
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (10/01/00)
425.08 Position Accountability for 30-Day Fed Funds Futures - A person as
defined in Regulation 425.01(b), who owns or controls more than 3,000 30-Day Fed
Fund futures contracts, net long or net short in all months combined, or net
long or net short in the spot month, shall thereby be subject to the following
provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such person automatically shall consent, when so ordered by the
Association acting in its discretion, not to increase further the
position in 30-Day Fed Fund futures contracts which exceeds the above-
referenced 3,000 contract level.
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney of otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (04/01/96)
Ch4 Margins and Deposits
430.00 Deposits by Customers - A member acting as commission merchant for a
customer (member or non-member) may require from such customer a deposit, as
indemnity against liability, and subsequent deposits to the extent of any
adverse fluctuations in the market price. Such deposits must be made with the
commission merchant within a reasonable time after demand, and, in the absence
of unusual circumstances, one hour shall be deemed a reasonable time. The
failure of the customer to make such deposit within such time, shall entitle,
but shall not obligate, the commission merchant to close out the trades of the
defaulting customer. If the commission merchant is unable to effect personal
contact with the customer, a written demand left at the office of the customer,
during business hours, shall be deemed sufficient. 209 (08/01/94)
431.00 Margins - No member may accept or carry an account for a customer,
whether a member or non-member, without proper and adequate margin. The Exchange
shall fix minimum margin requirements.
The provisions of the foregoing paragraph do not apply to a non-clearing member
who makes his own trades or who on the Floor gives his orders for trades which
are exclusively for his own account and pays the brokerage thereon. 210
(08/01/94)
431.00A Permit Holder Interpretation - The term 'non-clearing member' in
paragraph 2 of Rule 431.00 should be interpreted to include Permit Holders.
(08/01/94)
431.01 Margins - Non-Clearing Members - A non-clearing member who makes his
own futures trades or who on the Floor gives his orders for futures trades which
are exclusively for his account shall be subject solely to the provisions of
this Regulation. All futures transactions in such account shall be margined to
the market. 1822B (08/01/94)
431.02 Margin Requirements - Margin requirements shall at all times be those
requirements currently in effect. Changes in margin requirements shall be
effective on all transactions.
1. Transferred to Regulations 431.03 and 431.05.
2. Clearing members may carry contracts for future delivery for foreign and
domestic correspondents on a gross margin basis as provided in Paragraph 3
of Regulation 431.03, but only to the extent that such contracts are those
of customers and non-customers of the foreign and domestic correspondents.
3. If stocks, bonds or similar collateral, which must be free from liens and
from any impediments to negotiability, are deposited with a member
specifically to secure transactions which are executed on this Exchange,
the current market value less the applicable haircut as specified in SEC
Rule 15c3-1(c)(2)(vi) may be considered as margin value to such
transactions.
A registered futures commission merchant shall not accept as margin,
pledge, hypothecate, assign or factor any customer owned warehouse receipt
other than a warehouse receipt that is eligible for delivery in
satisfaction of futures contracts at a contract market.
4. Foreign currencies or foreign government securities which are deposited
with a member for margin purposes must be reported at the current rate of
exchange to the dollar equivalent. The margin value will be determined by
Regulation 431.02 paragraph 3.
5. In computing minimum margin requirements for any customer equities or
impairment resulting from change in market prices shall be regarded as
money equivalents.
6. No member shall extend any credit or give any rebate or gratuity of any
kind to any person for the purpose of circumventing or evading minimum
margin requirements.
7. It shall be incumbent upon each member to require satisfactory evidence
that all hedging trades are bona fide hedging trades. A letter from a
customer so stating will be considered "satisfactory evidence" under this
paragraph unless there is reason to suspect otherwise.
8. An account shall be entitled to spread margins, whenever said account is in
a spread position. The
carrying member shall designate spread position on his margin records.
9. When a correspondent member's account with the Clearing House member
consists of trades which are spreading trades, such account may be carried
as a spreading account by the clearing member.
10. It shall be incumbent upon each member financing purchases of cash grain
for country elevator customers to require satisfactory evidence that funds
so loaned are not used to margin future contracts other than for the
purpose of hedging cash grain.
When a customer states that funds required to fully margin his account are
being transmitted at once, the member may consider this assurance in lieu
of cash for a reasonable period. Members are required to keep written
records of all margin calls, whether made in writing or by telephone.
11. Members shall not accept orders for new trades from a customer, unless the
minimum initial margin on the new trades is deposited and unless the margin
on old commitments in the account equals or exceeds the initial
requirements on hedging and spreading trades and/or the maintenance
requirements specified in Regulations 431.03 and 431.05 on all other
trades. If the customer has a credit in excess of the initial margin
requirements on all old commitments in his account, this may be used as
part or all of the initial margins required on new commitments. However,
credits in excess of maintenance margins and less than initial margin
requirements may not be used.
12. No customer shall be permitted to make withdrawals from an account when the
margin therein is less than the minimum initial margin specified in
Regulations 431.03 and 431.05 or when the withdrawals would impair such
minimum requirements.
13. No member may carry for a customer spreading transactions when the
customer's account, figured to the market, would result in a deficit.
Minimum maintenance margins required on other transactions are specified in
Regulations 431.03 and 431.05. When a customer's account drops below the
maintenance margin level, the account must be brought back to initial
margin requirements. The failure of a member to close the customer's
account before it results in such deficit or undermargined condition shall
not relieve the customer of any liability to the member, nor shall such
failure on the part of a member amount to an extension of credit to the
customer if the member in the exercise of reasonable care has been unable
to close the account without incurring such deficit or undermargined
condition.
14. A member may use his discretion in permitting a customer having an
established account to trade during any day without margining each
transaction, provided the net position resulting from the day's trading is
margined as required by Rules 286.00, 431.00 and Regulations 431.02, 431.03
and 431.05.
15. When a customer switches an open interest in the same grain from one future
to another and the orders for the purchase and sale are placed
simultaneously, no additional margins need be required by his commission
merchant because of such switch. However, if such orders are not placed
simultaneously, the new position should be margined on the basis of minimum
initial margin requirements.
16. A bona fide hedger, in financial instruments, reporting positions on a
gross basis pursuant to Regulation 705.01, must pay appropriate margins on
the gross positions reported during the delivery month. 1822 (08/01/94)
431.02A Hedging Transactions - WHEREAS, Regulation 431.02(7) makes it
incumbent "upon each member to require satisfactory evidence that all hedging
trades are bona fide hedging trades," and
WHEREAS, Regulation 431.02(7) further states that "a letter from a customer so
stating will be considered 'satisfactory evidence' unless there is reason to
suspect otherwise;"
NOW THEREFORE, BE IT RESOLVED that whenever a non-member customer of a member or
member firm carries in its hedging account an open position in any Board of
Trade futures contract exceeding speculative position limits established by the
Association, it shall be incumbent upon the member or member firm to satisfy
itself, and to be able to confirm to the Business Conduct Committee that the
open position of such non-member customer, to the extent that it exceeds such
speculative position limits,
represents bona fide hedging transactions.
BE IT FURTHER RESOLVED that this resolution be published as a Ruling of the
Association. 42R (08/01/94)
431.03 Margin on Futures - (12/01/00)
(1) MAINTENANCE AND INITIAL MARGINS. Other than Hedging or Spreading. Under the
provisions of Rule 431.00, the Exchange hereby fixes the following minimum
maintenance and initial margins for futures transactions, other than hedging
and spreading transactions:
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-------------------------------------------------------------------------------------------------
Initial
Margin Initial
Maintenance Margin Mark-Up Margin
Percentage
-------------------------------------------------------------------------------------------------
Agricultural Group
-------------------------------------------------------------------------------------------------
Corn $ 350 per contract 135% $ 473
-------------------------------------------------------------------------------------------------
Iowa Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Illinois Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Indiana Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Nebraska Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Ohio Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
U.S. Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Oats $ 300 per contract 135% $ 405
-------------------------------------------------------------------------------------------------
Rough Rice $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------
Soybeans $ 700 per contract 135% $ 945
-------------------------------------------------------------------------------------------------
Soybean Meal $ 700 per contract 135% $ 810
-------------------------------------------------------------------------------------------------
Soybean Oil $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Wheat $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------
Metals Group
-------------------------------------------------------------------------------------------------
Gold - One Kilo $ 675 per contract 135% $ 473
-------------------------------------------------------------------------------------------------
Gold - 100 Ounce $1,050 per contract 135% $1,418
-------------------------------------------------------------------------------------------------
Silver - 1000 Ounce $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Silver - 5000 Ounce $1,688 per contract 135% $1,350
-------------------------------------------------------------------------------------------------
Financial Instrument Group
-------------------------------------------------------------------------------------------------
Treasury Bonds $1,300 per contract 135% $1,755
-------------------------------------------------------------------------------------------------
Treasury Note (6 1/2-10 year) $ 900 per contract 135% $1,215
-------------------------------------------------------------------------------------------------
Treasury Note (5 year) $ 550 per contract 135% $ 743
-------------------------------------------------------------------------------------------------
Treasury Note (2 year) $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------
Agency Notes (10 year) $ 800 per contract 135% $1,080
-------------------------------------------------------------------------------------------------
30-Day Fed Fund $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Municipal Bond Index $ 900 per contract 135% $1,215
-------------------------------------------------------------------------------------------------
Stock Index Group
-------------------------------------------------------------------------------------------------
DJIA(SM) Index $4,000 per contract 135% $5,400
-------------------------------------------------------------------------------------------------
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-------------------------------------------------------------------------------------------------
DJTA(SM) Index $2,000 per contract 135% $2,700
-------------------------------------------------------------------------------------------------
DJUA(SM) Index $2,000 per contract 135% $2,700
-------------------------------------------------------------------------------------------------
DJCA(SM) Index $1,000 per contract 135% $1,350
-------------------------------------------------------------------------------------------------
PCS Insurance Group
(Margins on theoretical futures
for options on the following)
-------------------------------------------------------------------------------------------------
National Catastrophe $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
National Catastrophe (loss period $2,000 per contract 135% $2,700
and beyond)**
-------------------------------------------------------------------------------------------------
Eastern Catastrophe $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
Eastern Catastrophe (loss period $2,000 per contract 135% $2,700
and beyond)**
-------------------------------------------------------------------------------------------------
California Catastrophe $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
California Catastrophe (loss $2,000 per contract 135% $2,700
period and beyond)**
-------------------------------------------------------------------------------------------------
Northeastern Catastrophe $ 100 per contract 135% $ 135
-------------------------------------------------------------------------------------------------
Northeastern Catastrophe (loss $ 100 per contract 135% $ 135
period and beyond)**
-------------------------------------------------------------------------------------------------
Fourth Qtr. '99 National, Eastern, $ 200 per contract 135% $ 270
Southeastern, and Florida
-------------------------------------------------------------------------------------------------
1999 Annual National and Western $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------
**Loss period margins are effective as of the first trading day of the loss
period or sooner if designated by the Board.
(2) HEDGING MARGINS. Subject to the provisions of Paragraphs 8, 9,10 and 11 of
Regulation 431.02, minimum initial and maintenance hedging margins on all
commitments in futures shall be as follows:
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Initial
Margin Initial
Maintenance Margin Mark-Up Margin
Percentage
-----------------------------------------------------------------------------------------------
Agricultural Group
-----------------------------------------------------------------------------------------------
Corn $ 350 per contract 100% $ 350
-----------------------------------------------------------------------------------------------
Iowa Corn Yield Insurance $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Illinois Corn Yield Insurance $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Indiana Corn Yield Insurance $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Nebraska Corn Yield Insurance $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Ohio Corn Yield Insurance $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
U.S. Corn Yield Insurance $ 300 per contract 100% $ 300
-----------------------------------------------------------------------------------------------
Oats $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Rough Rice $ 500 per contract 100% $ 500
-----------------------------------------------------------------------------------------------
Soybeans $ 700 per contract 135% $ 700
-----------------------------------------------------------------------------------------------
Soybeans Meal $ 700 per contract 135% $ 700
-----------------------------------------------------------------------------------------------
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Soybean Oil $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Wheat $ 500 per contract 100% $ 500
-----------------------------------------------------------------------------------------------
Metals Group
-----------------------------------------------------------------------------------------------
Gold - One Kilo $ 350 per contract 100% $ 350
-----------------------------------------------------------------------------------------------
Gold - 100 Ounce $1,050 per contract 100% $1,050
-----------------------------------------------------------------------------------------------
Silver - 1000 Ounce $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Silver - 5000 Ounce $1,000 per contract 100% $1,000
-----------------------------------------------------------------------------------------------
Financial Instrument Group
-----------------------------------------------------------------------------------------------
Treasury Bonds $1,300 per contract 100% $1,300
-----------------------------------------------------------------------------------------------
Treasury Note (6 1/2-10 year) $ 900 per contract 100% $ 900
-----------------------------------------------------------------------------------------------
Treasury Note (5 year) $ 550 per contract 100% $ 550
-----------------------------------------------------------------------------------------------
Treasury Note (2 year) $ 500 per contract 100% $ 500
-----------------------------------------------------------------------------------------------
Agency Notes (10 year) $ 800 per contract 135% $ 800
-----------------------------------------------------------------------------------------------
30 Day Fed Funds $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Municipal Bond Index $ 900 per contract 100% $ 900
-----------------------------------------------------------------------------------------------
Stock Index Group
-----------------------------------------------------------------------------------------------
DJIA(SM) Index $4,000 per contract 100% $4,000
-----------------------------------------------------------------------------------------------
DJTA(SM) Index $2,000 per contract 100% $2,000
-----------------------------------------------------------------------------------------------
DJUA(SM) Index $2,000 per contract 100% $2,000
-----------------------------------------------------------------------------------------------
DJCA(SM) Index $1,000 per contract 100% $1,000
-----------------------------------------------------------------------------------------------
PCS Insurance Group
(Margins on theoretical futures for
options on the following)
-----------------------------------------------------------------------------------------------
National Catastrophe $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
National Catastrophe (loss period and $2,000 per contract 100% $2,000
beyond)**
-----------------------------------------------------------------------------------------------
Eastern Catastrophe $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
Eastern Catastrophe (loss period and $2,000 per contract 100% $2,000
beyond)**
-----------------------------------------------------------------------------------------------
California Catastrophe $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
California Catastrophe (loss period and $2,000 per contract 100% $2,000
beyond)**
-----------------------------------------------------------------------------------------------
Northeastern Catastrophe $ 100 per contract 100% $ 100
-----------------------------------------------------------------------------------------------
Northeastern Catastrophe (loss period $ 100 per contract 100% $ 100
and beyond)**
-----------------------------------------------------------------------------------------------
Fourth Qtr. '99 National, Eastern, $ 200 per contract 100% $ 200
Southeastern, and Florida
-----------------------------------------------------------------------------------------------
[Enlarge/Download Table]
-----------------------------------------------------------------------------------------------
1999 Annual National and Western $ 200 per contract 100% $ 200
-----------------------------------------------------------------------------------------------
**Loss period margins are effective as of the first trading day of the loss
period or sooner if designated by the Board.
(3) SPREADING MARGINS. The minimum maintenance margin of spreading transactions
shall be as follows:
Intra-market spreads (involving the same commodity) where both sides of the
transaction are carried on the books of one member firm shall be margined to
the market, except for the following commodities which will be margined as
indicated:
------------------------------------------------------------
Old crop/New crop: Initial/Maintenance
------------------------------------------------------------
Corn $ 68 / $ 50
------------------------------------------------------------
Soybeans $ 473 / $ 350
------------------------------------------------------------
Soybean Meal $ 338 / $ 250
------------------------------------------------------------
Soybean Oil $ 135 / $ 100
------------------------------------------------------------
Wheat $ 135 / $ 100
------------------------------------------------------------
Oats $ 135 / $ 100
------------------------------------------------------------
Inter-market spreads where both sides of the transaction are carried on the
books of one member firm shall be as follows (See paragraph (1) for initial
margin mark-up percentage):
------------------------------------------------------------------------------
Spread Spread
Credit %
------------------------------------------------------------------------------
Soybeans vs. Soybean Oil 50%
------------------------------------------------------------------------------
Soybeans vs. Soybean Meal 65%
------------------------------------------------------------------------------
*Corn vs. Illinois Corn Yield Insurance 30%
------------------------------------------------------------------------------
*Corn vs. Indiana Corn Yield Insurance 30%
------------------------------------------------------------------------------
*Corn vs. Iowa Corn Yield Insurance 30%
------------------------------------------------------------------------------
*Corn vs. Ohio Corn Yield Insurance 30%
------------------------------------------------------------------------------
*Corn vs. U.S. Corn Yield Insurance 30%
------------------------------------------------------------------------------
*Corn vs. Nebraska Corn Yield Insurance 30%
------------------------------------------------------------------------------
-----------------------------------------------------------------------------
Treasury Notes (6-1/2-10 year) vs. Treasury Bonds 80%
------------------------------------------------------------------------------
(2) Treasury Notes (6-1/2-10 year) vs. Treasury Bonds 80%
------------------------------------------------------------------------------
(3) Treasury Notes (5 year) vs. (2) Treasury Notes 85%
(6-1/2-10 year)
------------------------------------------------------------------------------
Treasury Notes (6-1/2-10 year) vs. Municipal Bond Index 75%
------------------------------------------------------------------------------
Treasury Notes (2 year) vs. Municipal Bond Index 60%
------------------------------------------------------------------------------
Treasury Bonds vs. Municipal Bond Index 75%
------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Treasury Notes (6-1/2-10 year) 75%
------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Treasury Bonds 60%
------------------------------------------------------------------------------
(5) Treasury Notes (5 year) vs. (2) Treasury Bonds 75%
------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Municipal Bond Index 55%
------------------------------------------------------------------------------
(5) Treasury Notes (2 year) vs. (2) Treasury Bonds 65%
------------------------------------------------------------------------------
Treasury Notes (2 year) vs. Treasury Notes (6-1/2-10 year) 65%
------------------------------------------------------------------------------
Treasury Notes (2 year) vs. Treasury Notes (5 year) 85%
------------------------------------------------------------------------------
(3) Treasury Notes (2 year) vs. (2) Treasury Notes (6-1/2-10 75%
year)
------------------------------------------------------------------------------
Treasury Bonds vs. (2) 10 Yr. Agency 65%
------------------------------------------------------------------------------
10 Yr. Agency Notes vs. 10 Yr. T-Notes 80%
------------------------------------------------------------------------------
(2) 10 Yr. Agency Notes vs. (3) 5 Yr. T-Notes 75%
------------------------------------------------------------------------------
(2) 10 Yr. Agency Notes vs. (3) 2 Yr. T-Notes 65%
------------------------------------------------------------------------------
Iowa Corn Yield vs. Illinois Corn Yield 50%
------------------------------------------------------------------------------
Iowa Corn Yield vs. Indiana Corn Yield 50%
------------------------------------------------------------------------------
Iowa Corn Yield vs. Nebraska Corn Yield 50%
------------------------------------------------------------------------------
Iowa Corn Yield vs. Ohio Corn Yield 50%
------------------------------------------------------------------------------
Iowa Corn Yield vs. U.S. Corn Yield 70%
------------------------------------------------------------------------------
Illinois Corn Yield vs. Indiana Corn Yield 70%
------------------------------------------------------------------------------
Illinois Corn Yield vs. Nebraska Corn Yield 50%
------------------------------------------------------------------------------
Illinois Corn Yield vs. Ohio Corn Yield 50%
------------------------------------------------------------------------------
Illinois Corn Yield vs. U.S. Corn Yield 70%
------------------------------------------------------------------------------
Indiana Corn Yield vs. Nebraska Corn Yield 50%
------------------------------------------------------------------------------
Indiana Corn Yield vs. Ohio Corn Yield 70%
------------------------------------------------------------------------------
Indiana Corn Yield vs. U.S. Corn Yield 70%
------------------------------------------------------------------------------
Nebraska Corn Yield vs. Ohio Corn Yield 50%
------------------------------------------------------------------------------
Nebraska Corn Yield vs. U.S. Corn Yield 70%
------------------------------------------------------------------------------
Ohio Corn Yield vs. U.S. Corn Yield 70%
------------------------------------------------------------------------------
* Both positions must be on the same side of the market (long or short).
------------------------------------------------------------------------------
Crush Spread (Same Crop Year) Soybeans (September Forward)
vs.
------------------------------------------------------------------------------
Soybean Meal (October Forward) vs.
------------------------------------------------------------------------------
Soybean Oil (October Forward) 85%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Crush Spread
------------------------------------------------------------------------------
(10) Soybeans
------------------------------------------------------------------------------
vs. (11) Soybean Meal
------------------------------------------------------------------------------
vs. (9) Soybean Oil 85%
------------------------------------------------------------------------------
For the purpose of this paragraph, a crush spread is a position of 5,000
bushels of soybeans against one contract of soybean meal and one contract
of soybean oil or a ratio of contracts that conforms to generally accepted
soybean processor crush relationships. The number of crush spreads is
limited to the net positions within any of the commodities.
------------------------------------------------------------------------------
---------------------------------------------------------------------
Spread Spread Credit %
---------------------------------------------------------------------
1:1:1:4 DJTA(SM), DJUA(SM), DJIA(SM) vs. DJCA(SM) 70%
---------------------------------------------------------------------
1:2 DJIA(SM) vs. DJCA(SM) 70%
---------------------------------------------------------------------
(4) INTER-MARKET SPREADS. Inter-market spreads (involving the same commodity)
where both sides of the transaction are carried on the books of one member
firm shall be margined on the Chicago Board of Trade side as follows (SPAN-
does not currently recognize inter-market spreads):
[Enlarge/Download Table]
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Spread Spread Credit %
--------------------------------------------------------------------------------------
CBOT Wheat vs.Kansas City Board of Trade Wheat 80%
--------------------------------------------------------------------------------------
CBOT Wheat vs. Minneapolis Grain Exchange Spring Wheat 70%
--------------------------------------------------------------------------------------
Gold (100 oz.) vs. Comex Gold 50%
--------------------------------------------------------------------------------------
(3) Kilo Gold vs. (1) Comex Gold 50%
--------------------------------------------------------------------------------------
Silver (5000 oz.) vs. Comex Silver 50%
--------------------------------------------------------------------------------------
(5) CBOT 1,000 Silver vs. (1) Comex 5,000 Silver 50%
--------------------------------------------------------------------------------------
Other inter-market spreads:
--------------------------------------------------------------------------------------
(2) CBOT T-Note (2 year) vs. 3 CME Eurodollar 70%
--------------------------------------------------------------------------------------
(5) CBOT T-Note (2 year) vs. 2 FINEX T-Note (5 year) 80%
--------------------------------------------------------------------------------------
(5) CBOT T-Note (5 year) vs. 2 FINEX T-Note (5 year) 80%
--------------------------------------------------------------------------------------
(5) CBOT T-Note (5 year) vs. 2 FINEX T-Note (2 year) 80%
--------------------------------------------------------------------------------------
(1) CBOT DJIASM vs. (1) KCBOT Mini-Value Line 70%
--------------------------------------------------------------------------------------
(5) CBOT DJIASM vs. (2) Value Line 70%
--------------------------------------------------------------------------------------
(1) CBOT DJIASM vs. (10) Amex Diamonds $800
(per CBOT side)
--------------------------------------------------------------------------------------
(5) INTER-MARKET SPREADS FOR CBOT AND MIDAM CONTRACTS
(a) Customers
--- ---------
For purposes of Regulations 431.03 and 431.05, any spread or other recognized
strategy specified therein may consist of a combination of positions in Chicago
Board of Trade and MidAmerica Commodity Exchange (MidAm) contracts, provided
that each MidAm position in such a combination is equivalent in size, and is in
the same commodity, as is specified with respect to a Chicago Board of Trade
position.
(b) Non-Clearing Members
--- --------------------
For purposes of Regulations 431.01, 431.03 and 431.06, any spread or other
recognized strategy specified therein may consist of a combination of positions
in Chicago Board of Trade and MidAmerica
Commodity Exchange (MidAm) contracts, provided that each MidAm position in such
a combination:
- is equivalent in size, and is in the same commodity, as is specified
with respect to a Chicago Board of Trade position;
and
- is in a contract in which the non-clearing member has MidAm membership
privileges.
431.03A Margins - Spreads involving soybeans versus only crude soybean oil or
only soybean meal
or spreads involving crude soybean oil versus soybean meal do not meet the
requirements of Paragraph 4(a) of Regulation 431.03 and, therefore, do not
qualify for margins on one side only. 34R (08/01/94)
431.03B Margins - The Rules Committee was asked the following questions:
(1) Is it permissible for a carrying broker to maintain an account with a bank
where it is specified that the deposits therein are made at the request of a
particular client - such funds not necessarily being those of the client.
(2) Is it permissible to maintain such an account, limiting it to the amounts
deposited by such client.
The Committee is unanimously of the opinion that these practices are a
violation of the Association's minimum margin Rules and Regulations. They
constitute the extending of credit for margins. 40R (08/01/94)
431.04 Notice of Undermargined Omnibus Accounts - (See 285.05) (08/01/94)
431.05 Margin on Options - Under the provisions of Rule 431.00, the Board
hereby establishes that minimum margins for option transactions will be
determined by the *Standard Portfolio Analysis of Risk- (SPAN-) margin
calculations.
Maintenance margin will equal the maximum of:
(a) Market Risk Margin calculation
(b) Extreme Market Risk calculation
(c) Gross Short Option calculation
(d) Initial margins for each commodity are identified in Regulations
431.03(1), (2) and (3).
For all long option positions premium must be paid in full when the
position is initiated. See Regulations 1305.01, 1605.01, 2205.01, 2705.01,
2805.01, 2905.01, 3005.01, 3105.01, 3205.01, 3305.01, 3505.01, 3605.01,
3805.01, 4405.01, 4605.01, 4805.01 and 5205.01.
The values of the following policy variables will be determined by the
Board of Directors:
1. Normal range of futures price changes.
2. Normal range of implied volatility changes.
3. Intermonth spread margin for determining intermonth spread risk.
4. Extreme range of futures price changes.
5. Backup margin collection ratio for the Extreme calculation.
6. Gross short option assessment level. (07/01/00)
431.06 Margin on Options - Non-Clearing Members - A non-clearing member who
makes his own option trades or who on the Floor gives his orders for option
trades which are exclusively for his account shall be subject solely to the
provisions of the *Standard Portfolio Analysis of Risk- margin (SPAN-).
Maintenance margin will equal the maximum of:
(a) Market Risk Margin calculation.
(b) Extreme Market Risk calculation.
(c) Gross Short option calculation.
For all long option positions premium must be paid in full when the position is
initiated. See Regulations 1305.01, 1605.01, 2205.01, 2705.01, 2805.01, 2905.01,
3005.01, 3105.01, 3205.01, 3305.01, 3505.01, 3605.01, 3805.01, 4405.01, 4605.01,
4805.01 and 5205.01. (07/01/00)
*"SPAN-" and "Standard Portfolio Analysis of Risk-" are trademarks of the
Chicago Mercantile Exchange. The Chicago Mercantile Exchange assumes no
liability in connection with the use of SPAN by any person or entity.
B. Inter-Market Option Spreads - (See 431.03) section 5 (04/01/00)
432.00 Customers' Securities - The improper use of a customer's securities is
inconsistent with just and equitable principles of trade. 211 (08/01/94)
433.00 Agreement for Use of Securities - An agreement between a member and a
customer, authorizing the member to pledge securities, either alone or with
other securities carried for the account of the customer, either for the amount
due thereon or for a greater amount, or to lend such securities, does not
justify the member in pledging or loaning more of such securities than is fair
and reasonable in view of the indebtedness of said customer to said member.
No form of general agreement between a member and a customer shall warrant the
member in using securities carried for the customer for delivery on sales made
by the member for his own account, or for any account in which the firm or
corporation of said member or of any general or special partner therein is
directly or indirectly interested. 212 (08/01/94)
433.01 Construction of Rules 432.00 and 433.00 - A customer's wholly owned
securities and/or excess collateral (securities in excess of the approximate
amount required to enable the member carrying the account to finance it) must be
segregated in a manner which clearly identifies their ownership. The member
carrying the account shall keep a record of the location of such segregated
securities and the means by which their ownership may be identified. When such
securities are in the custody of another broker, the member carrying the account
shall keep such other broker fully informed at all times as to the specific
securities to be segregated. This Regulation applies to both odd lots and round
lots. (08/01/94)
Ch4 Transfer Trades/Exchange Service Fees
443.00 Exempt Transactions - The provisions of the Rules and Regulations
respecting member rates of commission and brokerage rates shall be superseded
not later than March 4, 1978. 219A (08/01/94)
444.01 Transfer Trades; Exchange of Futures for Physicals and Give-up
Transactions - Transfer trades, or office trades, are defined and limited to
trades made upon the books of a commission merchant for the purpose of: (a)
transferring existing trades from one account to another within the same office
where no change in ownership is involved; or, (b) transferring existing trade
s from the office of one commission merchant to the office of another commission
merchant where no change in ownership is involved, provided that no such
transfer may be made for the purpose of evading and avoiding delivery on such
trades and provided further that if such transfer is made after receipt from the
Clearing House of a notice of intention to deliver applicable to such trades,
then the notice of intention to deliver must be passed through the Clearing
House along with the trades so transferred and the Clearing House shall
thereupon pass the notice of intention to deliver to the commission merchant to
whom such transfer has been made and delivery shall be taken by such commission
merchant; or, (c) exchanging futures for cash commodities or in connection with
cash commodities transactions; or, (d) to establish the prices of cash
commodities; or, (e) correcting errors on cleared trades, provided the original
trade documentation confirms the error and the special clearing code or screen
designated by the Board of Directors has been used to identify these transfers;
or (f) transferring trades executed on behalf of another commission merchant
from the account of the executing commission merchant to the account of the
other commission merchant customer where no change of ownership is involved,
provided that the special clearing code or screen designated by the Board of
Directors has been used to identify these transfers. The Business Conduct
Committee ("BCC") may, in its discretion, upon written request, exempt a
transfer trade from the requirements of this provision providing that the
transfer trade is made for the purpose of combining the positions held by two or
more commodity pools which are operated by the same commodity pool operator and
traded by the same commodity trading advisor, pursuant to the same strategy,
into a single account so long as the transfer does not result in the liquidation
of any open positions, and the pro rata allocation of interests in the
consolidating account does not result in more than a de minimize change in the
value of the interest of any pool participant and such other transfers as the
BCC, in its discretion, shall exempt in connection with or as a result of, a
merger, asset purchase, consolidation or similar non-recurring transaction
between two or more entities where one or more entities become the successor in
interest to one or more other entities.
Give-up transactions must be transferred in accordance with the procedure
provided in subparagraph (f) above. In the case of give-up transactions, the
commission merchant ("executing commission merchant") executing a trade on
behalf of another commission merchant (the "carrying commission merchant")
(including such carrying commission merchant's customers) must submit the trade
to the Clearing House for clearing, and remains responsible for the clearing and
settlement of such trade as prescribed by the Clearing House. Executing
commission merchants and carrying commission merchants must utilize an automated
invoicing system for commission payments resulting from give-up transactions, as
determined by the Board of Directors. Notwithstanding the foregoing, the
executing commission merchant, carrying commission merchant and, as applicable,
the customer on the account at the carrying commission merchant for which the
trade is executed, may by agreement set out their respective obligations and
financial responsibility to one another relating to the transfer of the trade.
Exchange of futures in connection with cash commodity transactions or of futures
for cash commodities may be made at such prices as are mutually agreed upon by
the two parties to the transaction. All transactions involving exchanges of
futures in connection with cash commodity transactions or of futures for cash
commodities transactions involving CBOE 50 and CBOE 250 Stock Index futures
shall be priced within the day's trading range.
All transfer trades made between the offices of two commission merchants and all
office trades made in connection with cash commodity transactions or the
exchange of futures for cash commodities shall be
designated by proper symbol as transfer or office trades and must be cleared
through the Clearing House in the regular manner.
Transfer trades must be made at the same price or prices which appear on the
books of the transferring commission merchant, and the transfer must also show
the date when such trade or trades were originally made; provided, however, that
those transfers involving a debtor as defined by and in accordance with
Regulation 272.02 shall retain the original trade date for purposes of delivery
but shall be entered on the books of the transferee at the settlement price on
the day of the transfer. In addition, each party to transfer trade transactions
shall file with the Clearing House a memorandum stating the nature of the
transaction, whether the transaction has resulted in a change of ownership, the
kind and quantity of cash commodity, if any is involved, the kind, quantity and
price of the commodity future, the name of the opposite Clearing member, if any,
and such other information as the Clearing House may require. 1809A (09/01/98)
444.01A Transfer Trades and Inter-Market Spreads - Owing to the fact that
some questions have arisen as to what may properly be handled in the way of
give-ups, as office trades or transfer trades, particularly in connection with
the new Commodity Exchange Act, the Directors have found it necessary to clarify
this situation with certain interpretations which will be mailed to all members
shortly. In the meantime, there is one point which seems important because of
the past custom of the trade, and we wish to call attention to it. In case a
house has spread orders between markets at a guaranteed difference, such as
buying Winnipeg or Minneapolis or Kansas City and selling Chicago at a fixed
difference, it has been customary in the past in the event they found some other
house going the other way at the same difference to exchange futures in the two
markets in order to consummate the spread. In other words, this was done by
give-ups rather than by pit executions. Under the new interpretation, such a
give-up is not permissible, inasmuch as it involves a change of ownership and is
not a give-up against a cash transaction, as interpreted by the Commodity
Exchange Act or the Board of Trade Rules. Accordingly, it will not be
permissible to exchange futures in the form of give-ups under such
circumstances, which will compel the actual filling of these limited spreads by
means of pit executions.
While this appears to work a certain amount of hardship, it seems to be required
in order to conform to the law and to the Rules of the Association; and,
accordingly, attention is directed to it in order to avoid possible confusion
where spreads are being worked between two markets. (08/01/94)
444.01B Prohibition on Exchange of Futures for Cash Commodities Involving
Multi-Parties - The exchange of futures for cash commodities or in connection
with cash commodity transactions may only occur when the buyer of the futures
contracts is the seller of the cash commodity and the seller of the futures
contracts is the buyer of the cash commodity. The transaction must be submitted
to the clearing house by a clearing firm acting on its own behalf or for the
beneficial account of a customer who is a party to the transaction. (08/01/94)
444.02 Clearance of Exchanges of Futures for Physicals Transactions - With
respect to the futures portion of an exchange of future for physical
transaction, clearing firm on opposite sides of the transaction must
subsequently approve the terms of the transaction, including the clearing firm
(division), price, quantity, commodity, contract month and date prior to
submitting the transaction to the Clearing House. (08/01/94)
444.03 Transfer Trades in a Delivery Month - During the delivery month and 2
business days prior to the first delivery day, (or in the case of crude
petroleum during position month) transfer trades for the purpose of offsetting
existing positions where no change of ownership is involved are prohibited when
the date of execution of the position being transferred is not the same as the
transfer date. Positions carried at different houses for the same owner 2
business days prior and to a delivery month and thereafter (or in the case of
crude petroleum during position month) are required to be offset in the pit or
through the normal delivery process. The receiving firm has the responsibility
to assure compliance with this regulation. (08/01/94)
450.00 Exchange Service Fees -
(a) members, membership interest holders and member firms. Each Full and
Associate Member, Membership Interest Holder and member firm shall be
obligated to pay to the Association, at such times and in such manner as
the Board may prescribe, a transaction fee of 5 cents for each contract
(1) for such Member's or Membership Interest Holder's own account; (2) for
such member firm's account; and (3) executed by such Member or Membership
Interest Holder on the Floor of the Association as a floor broker for the
account of others. The maximum of fees paid hereunder per year by any Full
or Associate Member in respect to contracts described in categories (1) and
(3) above, shall be $25,000.
(b) non-member. Effective on the date set by Regulation adopted by the Board,
each member or registered eligible business organization handling the
funds of non-member customers shall include, in the statements to each
customer, an Exchange Service Fee of 50 cents for each Board of Trade
futures contract bought, sold or delivered for the account of the non-
member customer. All Exchange Service Fees collected from non-member
customers shall be remitted by the member or registered eligible business
organization to the Association at such times and in such manner as the
Board may prescribe. The Exchange Service Fees remitted to the Association
in respect to nonmember transactions shall be expended only for purposes
determined by the Board to be of benefit to non-member customers and other
market participants.
(c) licensed contract fee. In addition to the fee specified in Rule 450.00(b),
a Licensed Contract Fee of 25 cents per contract shall apply for non-member
transactions in Dow Jones(SM) and Municipal Bond Index contracts. This fee
shall be collected and remitted in the same manner as is specified in Rule
450.00(b).
(d) revenue. The Board shall have the authority in its discretion to suspend
member transaction fees, fees on the execution of trades and non-member
Exchange Service Fees at any time during a fiscal year upon making a
determination that year-to-date Exchange revenues have attained a
sufficient level to render the further collection of such fees unwarranted.
(e) reports. Each member or registered eligible business organization subject
to the provisions of this Rule shall submit to the Association such reports
as the Board may deem necessary for the administration of this Rule.
(f) enforcement. No member or registered eligible business organization shall
be obligated to the Association for the payment of Exchange Service Fees
attributable to non-member transactions except to the extent that such fees
are collected from non-member customers; provided, however, that each
member or registered eligible business organization responsible for the
collection of Exchange Service Fees shall make a bona fide and diligent
effort to collect such amounts and shall not have the right, without prior
approval of the Association, to release or forgive any indebtedness of a
non-member to the Association for Exchange Service Fees. In the event of
delinquencies in the payment of Exchange Service Fees by a non-member, the
Board in its discretion may order that further trading in the accounts of
such non-member shall be for liquidation only until the indebtedness is
paid.
(g) special assessments. This Rule shall not be construed to supersede Rule
240.00 in any way nor to abrogate the responsibility and right of the Board
to levy such additional assessments, charges or fees pon the membership as
may be necessary to meet the obligations of the Association. 136 (10/01/00)
450.01 Exchange Service Fees - Payment of the Exchange Service Fee in respect
to transactions executed by a Member, Membership Interest Holder, or Delegate on
the Floor as a floor broker for the account of others, under Rule 450.00, must
be remitted to the Exchange's Accounting Department within thirty days
commencing from the date of the Exchange's invoice to the member. Failure to
pay the invoiced transaction fees within the prescribed thirty days may result
in the suspension (pursuant to the provisions of Exchange Regulation 540.06) of
the defaulting member's membership privileges, including floor access and the
benefit of member transaction fees.
Payment of the Exchange Service Fee in respect to transactions for Members'
Membership Interest Holders' or Delegates' own accounts or Member firms'
accounts, under Rule 450.00, must be remitted to the Exchange's Accounting
Department by the member firm clearing such transactions within twenty-one days
commencing from the date of the Exchange's invoice to such clearing member firm.
Payment of the Exchange Service Fee in respect to non-member transactions under
Rule 450.00 executed on or after May 1, 1974 shall be as follows:
(1) Not later than the last business day of each month, each member or
registered eligible business organization handling the funds of non-member
customers shall submit to the Treasurer of the Association a report, in a
form prescribed by the Association showing the number of non-member
transactions (whether purchases, sales or deliveries) executed on change
during the preceding month, and the identity of non-members more than 60
days in arrears in the payment of Exchange Service Fees.
Such report should be accompanied by the remittance of all Exchange Service
Fees collected since the last remittance date.
(2) As soon as practicable following the end of each fiscal year, the
Association shall compute the total amount of Exchange Service Fees
received by it in respect to non-member transactions. If such total exceeds
all assessments paid by members under Rule 240.00 and all Exchange Service
Fees upon memberships under Rule 450.00 in the same fiscal year, the excess
shall be accumulated in a segregated contingency reserve fund. The reserve
fund may only be dispursed by separate action of the Board and then only
for those purposes identified in Rule 450.00.
(3) No member or registered eligible business organization shall identify on
its statements to nonmember customers any charge as an "Exchange Service
Fee" unless the amount shown is actually due and payable to the Association
under Rule 450.00. (08/01/00)
450.01A Exchange Service Fees - BE IT RESOLVED, that Regulation 450.01 be
adopted with effective date of April 1, 1974 for Exchange Service Fees on member
transactions and May 1, 1974 for Exchange Service Fees on non-member
transactions. (08/01/94)
450.01B Options Transactions - BE IT RESOLVED, that pursuant to the Board's
authority set forth in Rule 450.00 (a) and (b), the collection and payment of
all member and non-member transaction fees that otherwise would be applicable to
transactions in options on Treasury Bond futures shall be waived for any such
transactions made prior to March 31, 1983. (08/01/94)
450.01C Exchange Service Fees - BE IT RESOLVED, that pursuant to the Board's
authority set forth in Rule 450.00 (a) ane (b) the collection and payment of all
non-member transaction fees that otherwise would be applicable to transactions
in Major Market Index or AMEX Market Value Index futures contracts shall be
waived to the extent of forty eight cents per contract for the account of a
member or member firm of the American Stock Exchange. (08/01/94)
450.02 Member's Own Account and Member Firm's Account - For the purpose of
implementing Rule 450.00, the terms "member's own account" in subsection (a)(1)
and "member firm's account" in subsection (a)(2) shall refer only to those
commodity futures or commodity options trading accounts that are wholly owned by
and held in the name of one or more members, member firms, or entities which are
wholly-owned by one or more members or member firms or which wholly own a member
firm. No other direct or indirect affiliate of a member firm shall be entitled
to member transaction fees. The term "member firm" shall refer only to a firm
registered with the Exchange pursuant to Regulation 230.02. An account owned by
and held in the name of a non-member individual who is a shareholder, partner,
employee, director or officer of a member firm shall not be considered a member
firm's account. An account owned by and held in the name of a non-member spouse
or other relative of a member shall not be considered a member's account. In
addition, for the purpose of Rule 450.00, a commodity futures or commodity
options trading account placed in trust shall be deemed a "member's own account"
if the following are true: (1) the member is the sole settlor of the trust; (2)
the member is one of the trustees of the trust and as such trustee, has sole
control over the investment-making decision of the trust; (3) the beneficiaries
of the trust include only the member, the member's spouse and/or the member's
descendants; (4) the trust declaration expressly incorporates the Rules and
Regulations of the Exchange, as may be amended; (5) the interest in the trust
that inures to the beneficiaries of the trust shall be subject to all Rules and
Regulations of the Exchange, as may be amended; and (6) the non-member trustee,
if any, expressly agrees in the trust declaration, to be subject to all Rules
and Regulations of the Exchange,
as amended. The member must provide to the Exchange, via the Member Services
Department, a copy of the trust declaration creating the trust described in the
preceding sentence as well as any amendments thereto along with a letter from an
attorney stating that in the attorney's opinion, the trust created is designed
to achieve the estate planning objectives of the member. Upon the member's death
or if the member is adjudged incompetent, any commodity futures or commodity
options trading account placed in trust pursuant to this section by such member
will be treated as a non-member trading account and will be subject to Exchange
Service Fee set forth in Rule 450.00(b). (07/01/99)
450.03 Exchange Service Fees for Professional Trading Firms - (a) In
addition to the Exchange Service Fee assessed pursuant to Rule
450.00(a), any member firm that is or should be registered under
Regulation 230.02(6) and that is not wholly-owned by members or member
firms shall also be obligated to pay to the Association, at such times
and in such manner as the Board may prescribe, an additional transaction
fee of 3.5 cents for each contract for such member firm's account. For
the purpose of the previous sentence, "members" shall mean those
individuals who own or have delegated to them any of the following
memberships or membership interests: Full, Associate, COM or IDEM.
(b) This Regulation 450.03 shall not apply to those member firms whose
employee-members(s) personally execute(s), on the trading floor and/or
on the e-cbot electronic trading system for the eligible business
organization's proprietary account, at least five hundred thousand
(500,000) contracts in its first year as a member firm of the Exchange
and at least 1 million (1,000,000) contracts for each calendar year
thereafter. (09/01/00)
450.04 Exchange Service Fees - Adjustments - Exchange Service Fee
adjustments may be granted to or required of member firms which have made
overpayments or underpayments to the Exchange as a result of the incorrect
identification of member or non-member accounts. However, such adjustments will
not be made or required for any time period which is earlier than five years
before the month-end preceding the date when a rebate request is made by the
firm or which is earlier than five years before the end of the audit period
selected by the Exchange. Interest and/or costs may be assessed in accordance
with policies established by the Regulatory Compliance Committee. (01/01/99)
450.05 Fees - Members and member firms will be granted lower fees than non-
members. (11/01/00)
Ch4 Adjustments
460.01 Errors and Mishandling of Orders - (See 350.04) (08/01/94)
460.02 Checking and Reporting Trades - (See 350.02) (08/01/94)
460.03 Failure to Check Trades - (See 350.01) (08/01/94)
460.04 Price of Execution Binding - (See 331.01) (08/01/94)
Ch4 Customer Orders
465.01 Records of Customers' Orders - Immediately upon receipt in the sales
office of a customer order each member or registered eligible business
organization shall prepare a written record of the order. It shall be dated and
time-stamped when the order is received and shall show the account designation,
except that in the case of a bunched order the account designation does not need
to be recorded at that time if the order qualifies for and is executed pursuant
to and in accordance with CFTC Regulation 1.35(a-1)(5). The order shall also be
time-stamped when it is transmitted to the Floor of the Exchange and when its
execution, or the fact that it is unable to be executed, is reported from the
Floor of the Exchange to the sales office. All time-stamps required by this
paragraph shall show the time to the nearest minute.
Immediately upon receipt on the Floor of the Exchange of a customer order, each
member or registered eligible business organization shall prepare a written
record of the order. It shall be dated and time-stamped when the order is
received on the Floor and shall show the account designation, except that in the
case of a bunched order the account designation does not need to be recorded at
that time if the order qualifies for and is executed pursuant to and in
accordance with CFTC Regulation 1.35(a-1)(5). The order shall also be time-
stamped:
(a) when it is transmitted to the floor broker if it is not transmitted
immediately after it is received on the Floor, and
(b) if the written order is transmitted to the floor broker, when the order is
received back from the floor broker, or
(c) if the order is transmitted to the floor broker verbally or by hand
signals, when a report of its execution, or the fact that it is unable to
be executed, is received from the floor broker.
Only time-stamps which are specified by the Exchange and synchronized with the
Exchange Floor master clock may be used on the Exchange Floor.
It shall be an offense against the Association to manipulate or tamper with any
time-stamp on the Exchange Floor, so as to put it out of synchronization with
the master clock. Records of customer orders executed through the Exchange's
Project A system facility shall be governed by 9B.20.
Any errors on written records of customer orders prepared on the Floor of the
Exchange may be corrected by crossing out the erroneous information without
obliterating or otherwise making illegible any of the originally recorded
information. (07/01/99)
465.02 Application and Closing Out of Offsetting Long and Short Positions -
(a) APPLICATION OF PURCHASES AND SALES. Any commission merchant, subject to the
Rules of the Association, who
(1) Shall purchase any commodity for future delivery for the account of any
customer (other than the "Customers' Account" of another commission
merchant) when the account of such customer at the time of such purchase
has a short position in the same future of the same commodity on the
same market, or
(2) Shall sell any commodity for future delivery for the account of any
customer (other than the "Customers' Account" of another commission
merchant) when the account of such customer at the time of such sale has
a long position in the same future of the same commodity on the same
market, or
(3) Shall purchase a put or call option for the account of a customer when
the account of such customer at the time of such purchase has a short
put or call option position in the same option series as that purchased,
or
(4) Shall sell a put or call option for the account of a customer when the
account of such customer at the time of such sale has a long put or call
option position in the same option series as that sold
shall on the same day apply such purchase or sale against such previously
held short or long futures or options position, as the case may be, and
shall promptly furnish such customer a purchase and sale statement showing
the financial result of the transactions involved.
(b) CUSTOMERS'S INSTRUCTIONS. In all instances wherein the short or long futures
or options position in such customer's account immediately prior to such
offsetting purchase or sale is greater than the quantity purchased or sold,
the commission merchant shall apply such offsetting purchase or sale to such
portion of the previously held short position as may be specified by the
customer. In the absence of specific instructions from the customer, the
commission merchant shall apply such offsetting purchase or sale to the
oldest portion of the previously held long or short position, as the case
may be. Such instructions also may be accepted from any person who, by power
of attorney or otherwise, actually directs trading in the customer's account
unless the person directing the trading is the commission merchant
(including any partner thereof), or is an officer, employee, or agent of the
commission merchant. With respect to every such offsetting transaction that,
in accordance with such specific instructions, is not applied to the oldest
portion of the previously held futures or options position, the commission
merchant shall clearly show on the purchase and sale statement issued to the
customer in connection with the futures or options transaction, that as a
result of the specific instructions given by or on behalf of the customer
the transaction was not applied in the usual manner i.e., against the oldest
portion of the previously held futures or option position. However, no such
showing need be made if the commission merchant has received such specific
instructions in writing from the customer for whom such an account is
carried.
(c) IN-AND-OUT TRADES; DAY TRADES. Notwithstanding the provisions of paragraphs
(a) and (b) above, this Regulation shall not be deemed to require the
application of purchases or sales closed out during the same day (commonly
known as "in-and-out trades" or "day trades") against short or long
positions carried forward from a prior date.
(d) EXCEPTIONS. The provisions of this Regulation shall not apply to:
(1) purchases or sales of futures contracts for the purpose of covering the
granting of options on a contract market, if such purchases or sales are
accompanied by instructions and other evidence that such futures
contracts are cover for granted options.
(2) Purchases or sales constituting "bona fide hedging transactions" as
defined in C.F.T.C. Regulation 1.3(z).
(3) sales during a delivery period for the purpose of making delivery during
such delivery period if such sales are accompanied by instructions to
make delivery thereon, together with warehouse receipts or other
documents necessary to effectuate such delivery.
(4) Purchases or sales made in separate account of a commodity pool,
provided that:
(i) The trading for such pool is directed by two or more unaffiliated
commodity trading advisors acting independently, each of which is
directing the trading of a separate account;
(ii) The commodity pool operator maintains only such minimum control
over the trading for such pool as is necessary to fulfill its duty
to supervise diligently the trading for such pool;
(iii) Each trading decision made by a commodity trading advisor for
such pool is determined independently of all trading decisions
made by any other commodity trading advisor for such pool;
(iv) The purchases and sales for such pool directed by different
commodity trading advisors acting independently are executed by
open and competitive means on or subject to the rules of a
contract market; and
(v) No position held for or on behalf of separate pool accounts traded
in accordance with paragraphs (d) (4) (i), (d) (4) (ii), (d) (4)
(iii) and (d) (4) (iv) of this section may be closed out by
transferring such an open position from one of the separate
accounts to another
account of the pool.
(5) Purchases or sales made in separate accounts owned by a customer or
option customer, provided that:
(i) Each person directing trading for one of the separate accounts is
unaffiliated with and acts independently from each other person
directing trading for a separate account;
(ii) Each person directing trading for one of the separate accounts,
unless he is the account owner himself, does so pursuant to a
power of attorney signed and dated by the customer, and which
includes, at a minimum, the name, address and telephone number of
the person directing trading and the account number over which
such power is granted;
(iii) Each trading decision made for each separate account is
determined independently of all trading decisions made for the
other separate account or accounts;
(iv) The purchases and sales for such accounts are executed by open and
competitive means on or subject to the rules of a contract market;
(v) No position held for or on behalf of separate accounts traded in
accordance with paragraphs (d) (5) (i), (d) (5) (ii), (d) (5)
(iii) and (d) (5) (iv) of this section may be closed out by
transferring such an open position from one of the separate
accounts to another of such accounts; and
(vi) The customer or option customer and each person directing trading
for the customer or option customer provides the futures
commission merchant with written confirmation that the trading and
the operation of the customer's or option customer's accounts will
be in accordance with paragraphs (d) (5) (i), (d) (5) (ii), (d)
(5) (iii), (d) (5) (iv) and (d) (5) (v) of this section. The
written confirmation must be signed and dated, and received by the
futures commission merchant before it can avail itself of this
exception provided by this paragraph.
(6) Purchases or sales made in separate accounts of a p')''})' anted an
exemption in accordance with 425.05 and 495.05 of this chapter, provided
that:
(i) The purchases and sales for such accounts are executed in open and
competitive means on or subject to the rules of a contract market;
and
(ii) No position held for or on behalf of separate accounts traded in
accordance with this paragraph may be closed out by transferring
such an open position from one of the separate accounts to another
of such accounts.
(7) Purchases or sales held in error accounts, including but not limited to
floor broker error accounts, and purchases or sales identified as errors
at the time they are assigned to an account that contains other
purchases or sales not identified as errors and held in that account
("error trades"), provided that:
(i) Each error trade does not offset another error trade held in the
same account;
(ii) Each error trade is offset by open and competitive means on or
subject to the rules of a contract market by not later that the
close of business on the business day following the day the error
trade is discovered and assigned to an error account or identified
as error trade, unless at the close of business on the business
day following the discovery of the error trade, the relevant
market has reached a daily price fluctuation limit and the trader
is unable to offset the error trade, in which case the error trade
must be offset as soon as practicable thereafter; and
(iii) No error trade is closed out by transferring such an open
position to another account also controlled by that same trader.
(8) Purchases or sales held in the separate accounts of a customer who has
granted discretionary authority to a futures commission merchant, an
associated person of a futures commission merchant, or a commodity
trading advisor trading separate trading programs which have been
marketed separately, provided that:
(i) The purchases or sales for such accounts are executed in open and
competitive means on or subject to the rules of a contract market;
and
(ii) No position held for or on behalf of separate accounts traded in
accordance with this paragraph (d)(8) may be closed out by
transferring such an open position from one of the separate
accounts to another of such accounts.
(e) With respect to the exception from the provisions of this section set forth
in paragraph (d) (5) of this section, if a futures commission merchant that
carries the separate accounts of a customer or option customer, or if an
associated person of such futures commission merchant, directs trading for
one of the separate accounts:
(1) the futures commission merchant must first furnish the customer or
option customer with a written statement disclosing that, if held open,
offsetting long and short positions in the separate accounts may result
in the charging of additional fees and commissions and the payment of
additional margin, although offsetting positions will result in no
additional market gain or loss. Such written statement shall be attached
to the risk disclosure statement required to be provided to a customer
or option customer under CFTC Regulation 1.55. (07/01/94)
465.02A Exchange's No Position Stance on FCM's Internal Bookkeeping Procedures
- The Exchange takes no position regarding the internal bookkeeping procedures
of a commission merchant who, for the convenience of a customer, may hold
concurrent long and short position in the same commodity, month (and strike
price). This does not relieve the commission merchant of its responsibilities
under Regulation 465.02 of offsetting the position for Exchange reporting
purposes (i.e., Large Trader, Open Interest and Long Positions Eligible for
Delivery) and promptly furnishing the customer a purchase and sale statement
showing the financial result of the transactions involved. (08/01/94)
465.03 Orders and Cancellations Accepted On A 'Not Held' Basis - (See 337.01)
(08/01/94)
465.04 Records of Floor Order Forms - Clearing Members shall establish and
maintain procedures that will assure the complete accountability of all floor
order forms used on the Exchange Floor. Machine and handwritten orders are
required to be machine sequentially prenumbered and maintained by the firm in
sequential order. (08/01/94)
465.05 Floor Order Forms - All floor orders must be in a form approved by the
Floor Governors Committee or an employee of the Office of Investigations and
Audits designated by the Floor Governors Committee.
Floor order forms must be machine sequentially prenumbered and contain the
following machine preprinted information:
(1) the name of the Clearing Member;
(2) bracket designations,
(3) a space designated for the customer account number; and
(4) a space designated for the executing broker identification. (08/01/94)
465.06 Broker's Copy of Floor Orders - Upon request, a clearing firm must
provide its broker, in an expeditious and reasonable manner, with a copy of
every floor order he is asked to execute. (08/01/94)
465.07 Designation of Order Number Sequences - To facilitate Exchange
monitoring of order flow volume, the Exchange may prescribe particular sequences
of order form numbers for member firms to use in specified areas of the Exchange
Floor. (07/01/94)
465.08 Post-Execution Allocation - All trades entered and executed in
accordance with CFTC Regulation 1.35(a-1)(5) regarding orders eligible for post-
execution allocation, must be allocated in sufficient time to meet the
requirements of the Board of Trade Clearing Corporation trade submission for the
trade date of the order. (07/01/99)
466.00 Orders Must be Executed in the Public Market - (See 332.00) (08/01/94)
Ch4 Offices and Branch Offices
475.00 Offices and Branch Offices - Member firms and member sole proprietors
may establish offices other than main offices. All offices of member firms and
member sole proprietors and employees thereof shall be subject to the Rules and
Regulations of the Association, and shall be subject to the jurisdiction of the
Business Conduct Committee in connection therewith; provided, however, that the
Business Conduct Committee may exempt such offices and employees from any such
Rule or Regulation which is incompatible with, in conflict with or unrelated to
the functions performed by them. The term "branch office" shall include each
branch office or wholly-owned subsidiary of the member firm that solicits,
accepts, or services Commodity Futures Contracts or Options and/or is listed by
the member firm as a branch office with the National Futures Association.
A branch office must conduct business under the same name as the parent firm or
corporation. 129 (01/01/99)
Ch4 APs and Other Employees
480.01 APs - An Associated Person ("AP") is an employee of a member sole
proprietor or member firm who solicits, accepts or services business other than
in a clerical capacity in commodity futures and commodity options, and who has
been granted registration as an Associated Person ("AP") by the Commodity
Futures Trading Commission (CFTC) or the National Futures Association (NFA)
pursuant to the Commodity Exchange Act. (08/01/94)
480.02 Employers Responsible for APs - Employers, in all instances, shall be
responsible for the acts and omissions of their APs and branch office managers.
(08/01/94)
480.09 Other Employees - The Business Conduct Committee may require that the
name, remuneration, term of employment and actual duties of any employee of a
member or of a member firm shall be stated to the Committee, together with such
other information with respect to the employee as the Committee may deem
requisite. The Committee may, in its discretion, disapprove of said employment,
remuneration or term of employment. (08/01/94)
480.10 Supervision - Any willful act or omission by which a member fails to
ensure compliance with the rules, regulations and bylaws of the Association by
such member's partners, employees, agents or persons subject to his supervision
shall constitute an offense against the Association by the member.
Any willful act or omission by which a member firm fails to ensure compliance
with the rules, regulations and bylaws of the Association by such member firm's
partners, directors, officers, employees or agents shall constitute an offense
against the Association by the member firm. (07/01/95)
Ch4 Options Transactions
490.00 Application of Rules and Regulations - Unless specifically negated or
unless superseded, each Rule or Regulation of the Association pertaining to
transactions in future delivery contracts shall apply with equal force and
effect to transactions in options. (08/01/94)
490.02 Option Customer Complaints - Each commission merchant engaging in the
offer or sale of options pursuant to these Rules and Regulations shall, with
respect to all written option customer complaints and oral option customer
complaints which result in, or which would result in an adjustment to the option
customer's account in an amount in excess of one thousand dollars:
(1) Retain all such written complaints and make and retain written records
of all such oral complaints; and
(2) Make and retain a record of the date the complaint was received, the
employee who serviced the account, a general description of the matter
complained of, and what, if any, action was taken by the commission
merchant in regard to the complaint. (08/01/94)
490.03 Supervision Procedures - Each commission merchant engaging in the
offer or sale of options pursuant to these Rules and Regulations shall adopt and
enforce written procedures pursuant to which it will be able to supervise
adequately each option customer's account, including but not limited to, the
solicitation of such account; provided that, as used in this Regulation, the
term "option customer" does not include another commission merchant. (08/01/94)
490.03A Introducing Brokers Guaranteed by Member FCMs/Supervision Procedures
- The Board of Directors in a special polling held on Friday, February 3, 1984
approved the following Resolution of the Member Services Committee pursuant to
Regulation 490.03 of the Association.
WHEREAS, The Commodity Futures Trading Commission has provided by regulation
that introducing brokers operating pursuant to a guarantee agreement with an
FCM be permitted to solicit and/or accept orders for exchange-traded options
if the Exchange of which the guarantor FCM is a member has adopted rules
which govern the commodity option related activity of the guaranteed
introducing broker; and
WHEREAS, it is the desire of certain members to permit the solicitation
and/or acceptance of Chicago Board of Trade options by introducing brokers
guaranteed by a member FCM;
NOW THEREFORE, be it -
RESOLVED, that each Rule or Regulation of the Association pertaining to the
options sales practices of members or their employees shall apply with equal
force and effect to the options sales practices of introducing brokers who are
operating pursuant to a guarantee agreement with a member FCM and such member
FCM shall be fully responsible therefor, and that this Resolution shall remain
in effect until rescinded by a vote of the members or until such time as the
National Futures Association or other registered futures association adopts
rules which are approved by the Commodity Futures Trading Commission to govern
the commodity option related activity of such guaranteed introducing brokers.
(08/01/94)
490.05 Disclosure - Each commission merchant engaging in the offer or sale of
options pursuant to these Rules and Regulations shall enforce the following
requirements pertaining to disclosure statements:
(1) Prior to opening an options account for an options customer, each
commission merchant must furnish the options customer with a separate
written risk disclosure statement, as set forth and described in
Commodity Futures Trading Commission Regulation 33.7, and receive from
the options customer an acknowledgement, signed and dated by the
options customer, that he received and understood the disclosure
statement.
(2) Each disclosure statement and acknowledgement must be retained by the
commission merchant in accordance with applicable Regulations of the
Commodity Futures Trading Commission.
(3) Prior to the entry into an options transaction pursuant to these Rules
and Regulations, each commission merchant or the person soliciting or
accepting the order therefor must provide each options customer with
all of the information required under the disclosure statement;
Provided, further, that the commission merchant must provide current
information to an options customer if the information provided
previously has become inaccurate.
(4) Prior to the entry into an options transaction pursuant to these Rules
and Regulations, each options customer or prospective options customer
shall, to the extent the following amounts are known or can reasonably
be approximated, be informed by the person soliciting or accepting the
order therefore of the amount of the premium, commissions, costs, fees
and other charges to be incurred in connection with the options
transaction, as well as the strike price and all costs to be incurred
by the options customer if the option is exercised; in addition, the
limitations, if any, on the transfer of an options customer's account
to a commission merchant other than the one through whom the options
transaction is to be executed shall also be provided in writing.
(5) For the purposes of this Regulation, a commission merchant shall not be
deemed to be an options customer. (08/01/94)
490.06 Promotional Material - Each commission merchant engaging in the offer
or sale of futures and options pursuant to these Rules and Regulations shall
promptly make available upon request to the Office of Investigations and Audits
all promotional material pertaining to trading in such futures and options.
For the purposes of this Regulation, the term "promotional material" includes:
(1) any text of a standardized oral presentation, or any communication for
publication in any newspaper, magazine or similar medium, or for
broadcast over television, radio, or other electronic medium, which is
disseminated or directed to a customer or prospective customer
concerning a commodity futures or option transaction;
(2) any standardized form of report, letter, circular, memorandum or
publication which is disseminated or directed to a customer or
prospective customer; and
(3) any other written material disseminated or directed to a customer or
prospective options customer for the purpose of soliciting a futures or
options order, including any disclosure statement. (08/01/94)
490.07 Sales Communication - Each commission merchant engaging in the offer
or sale of futures and options pursuant to these Rules and Regulations is
prohibited from making fraudulent or high-pressure sales communications relating
to the offer or sale of such futures and options. (08/01/94)
490.09 Reports by Commission Merchants - Each commission merchant shall make
and submit such reports showing options positions held by any of its customers,
in such form as may be required from time to time by the Office of
Investigations and Audits or the Business Conduct Committee. Specifically, and
without limiting the authority of the Office of Investigations and Audits or the
Business Conduct Committee under this Regulation, all information needed to
comply with Part 16 of the Commission's Regulations (17 CFR Part 16) may be
collected from any member. (08/01/94)
[Enlarge/Download Table]
============================================================================================
Chapter 5
Disciplinary Proceedings
============================================================================================
Ch5 Offenses......................................................................
500.00 Inequitable Proceedings...............................................
501.00 Fictitious Transactions...............................................
502.00 Demoralization of Market..............................................
503.00 Misstatements.........................................................
504.00 Acts Detrimental to Welfare of the Association........................
504.00A Transactions in Warehouse Receipts....................................
505.00 Commodity Exchange Act................................................
506.00 Reckless Dealing......................................................
507.00 Investment Trust Corporation..........................................
508.00 Circulation of Rumors.................................................
509.00 Other Offenses........................................................
511.00 Trading on Other Exchanges............................................
512.00 Insolvency............................................................
513.00 Announcement of Suspension............................................
514.00 Insolvent Member......................................................
515.00 Investigation.........................................................
515.01 Insolvency............................................................
516.00 Reinstatement.........................................................
517.00 Suspended Member......................................................
518.00 Suspension for Default................................................
519.00 Decorum Offenses......................................................
519.00A 505
519.01 Committee Procedure...................................................
519.02 Floor Conduct Committee...............................................
519.03 Bracketing Violations.................................................
519.04 Pit Committee Supervision and Enforcement of Pit Decorum..............
519.05 Weapons Prohibition...................................................
519.06 Submission of Computerized Trade Reconstruction Data..................
519.07 Sexual Harassment.....................................................
520.00 Smoking...............................................................
520.00A Exchange Floor Fines..................................................
521.00 Floor Access..........................................................
Ch5 Proceedings...................................................................
540.00 Proceedings Before The Board..........................................
540.00A Committee Authority To Refer Matters for Investigation................
540.01 Review Of Investigation Report........................................
540.02 Notice and Answer in Connection with Disciplinary Proceedings.........
540.03 Procedures for Hearings on Charges....................................
540.04 Disciplinary Decisions................................................
540.05 Appeals from a Decision of a Disciplinary Committee...................
540.06 Procedures For Member Responsibility Actions..........................
540.07 Finality Of Disciplinary Decisions And Member Responsibility Actions..
540.08 Offers of Settlement..................................................
540.09 Offers of Settlement..................................................
540.10 Disciplinary Jurisdiction Over Agricultural Regular Firms.............
540.11 Appellate Committee...................................................
[Download Table]
540.12 Hearing Committee.....................................................
540.13 Application of Rules and Regulations..................................
540.14 Disciplinary Committee Composition....................................
540.15 Failure to Pay a Disciplinary Fine....................................
541.00 Special Investigations By Board.......................................
542.00 Business Conduct Committee............................................
543.00 Floor Governors Committee.............................................
543.01 Investigations........................................................
544.00 Waiver of Hearing.....................................................
545.00 Testimony And Production Of Books And Records.........................
545.01 Furnishing Information................................................
545.02 Record Keeping........................................................
545.03 Record Keeping Qualifications.........................................
545.04 Equity Runs Transmission Requirement..................................
545.05 Maintenance of Telephone Recordings...................................
546.00 Testimony Before Other Exchanges......................................
548.00 Incriminating Evidence................................................
549.00 Depositions of Witnesses..............................................
550.00 Rehearing.............................................................
551.00 Financial Compliance Committee........................................
Ch5 Penalties...................................................................
560.00 Expulsion and Suspension from Membership..............................
560.01 Disciplinary Notice...................................................
560.02 Association Bar.......................................................
561.00 Suspended or Expelled Member Deprived of Privileges...................
562.00 Discipline During Suspension..........................................
563.00 Trade Checking Penalties..............................................
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Chapter 5
Disciplinary Proceedings
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Ch5 Offenses
500.00 Inequitable Proceedings - It shall be an offense against the
Association to violate any Rule or Regulation of the Association or any By-Law
or Resolution of the Clearing House, regulating the conduct or business of
members, or any agreement made with Association, or engage in fraud,
dishonorable or dishonest conduct, or in conduct or proceedings inconsistent
with just and equitable principles of trade, or make default relating to the
delivery of contracts traded for future delivery (unless such default was
unintentional). 141 (08/01/94)
501.00 Fictitious Transactions - It shall be an offense against the
Association to create fictitious transactions or to give an order for the
purchase or sale of futures or options the execution of which would involve no
change in ownership, or to execute such an order with knowledge of its
character. 142 (08/01/94)
502.00 Demoralization of Market - Purchases or sales of commodities or
securities, or offers to purchase or sell commodities or securities, made for
the purpose of upsetting the equilibrium of the market and bringing about a
condition of demoralization in which prices will not fairly reflect market
values, are forbidden and any member who makes or assists in making such
purchase or sale or offers to purchase or sell with knowledge of the purpose
thereof, or who, with such knowledge shall be a party to assist in carrying out
any plan or scheme for the making of such purchases or sales or offers to
purchase or sell, shall be deemed to be guilty of an act inconsistent with just
and equitable principles of trade. 143 (08/01/94)
503.00 Misstatements - It shall be an offense against the Association to make
a misstatement upon a material point to the Board, or to a Standing or Special
Committee, or to the Executive Committee, or to the Board of Governors of the
Clearing House, or on an application for membership.
If, after notice and opportunity for hearing in compliance with Regulation
540.02 and 540.03, the Hearing Committee finds that a member, prior to his
application for membership, has been guilty of a fradulent, dishonorable, or
dishonest act and that the facts and circumstances thereof were not disclosed on
his application for membership, the member may be expelled or suspended in
accordance with this chapter. 144 (08/01/94)
504.00 Acts Detrimental to Welfare of the Association - It shall be an
offense against the Association to engage in any act which may be detrimental to
the interest or welfare of the Association. 145 (08/01/94)
504.00A Transactions in Warehouse Receipts - Rule 504.00
It has come to the attention of the Directors that certain member firms have
entered into contracts for the purchase and/or sale for deferred delivery of
warehouse receipts for grain in store in Chicago.
In the opinion of the Directors, this practice is unusual and irregular and is
in violation of various Rules and Regulations of the Association and is
detrimental to the interest and welfare of the Association under Rule 504.00.
You are hereby notified that members are liable to discipline if they enter into
contracts for the purchase or sale for deferred delivery of grain in store in
Chicago or of warehouse receipts issued against grain in elevators located in
the Chicago Switching District.
This interpretation does not affect the purchase and sale of grain for future
delivery consummated in accordance with the Rules and Regulations relating to
futures contracts; nor sales in store when payment and delivery is made on the
following day nor the purchase and sale of warehouse receipts on a 'when
Ch5 Offenses
------------
delivered' basis entered into after the expiration of trading in a contract and
requiring performance on or before the end of the delivery month. 3R
(08/01/94)
505.00 Commodity Exchange Act - Any member or any registered eligible
business organization adjudged guilty of a violation of the Commodity Exchange
Act or of any Regulation or Order thereunder, by the final decision in a federal
administrative or judicial proceeding may be deemed to have violated Rule 504.00
of the Association. 603 (04/01/98)
506.00 Reckless Dealing - Reckless and unbusinesslike dealing is inconsistent
with just and equitable principles of trade. 146 (08/01/94)
507.00 Investment Trust Corporation - Participation by a member, or by a firm
or corporation, registered under the provisions of these Rules and Regulations,
in the formation or management of investment trust corporations, or similar
organizations, which in the opinion of the Board involve features which do not
properly protect the interests of investors therein, may be held to be an act
detrimental to the interests or welfare of the Association. 148 (08/01/94)
508.00 Circulation of Rumors - The circulation in any manner of rumors of a
sensational character by a member, in any case where such act does not
constitute fraud or conduct inconsistent with just and equitable principles of
trade, is an act detrimental to the interest or welfare of the Association.
Members shall report to the Secretary any information which comes to their
notice as to the circulation of such rumors. 149 (08/01/94)
509.00 Other Offenses
A. It shall be an offense against the Association to:
(a) Attempt extortion;
(b) Trade systematically against the orders or position of his customers;
(c) Manipulate prices of or attempt to corner the market in any commodity or
security;
(d) Disseminate false or inaccurate market information;
(e) Trade or accept margins after insolvency;
(f) Make any trade for the account of or give up the name of any clearing
member without authority from such clearing member;
(g) Be deprived of the privilege of trading under the Commodity Exchange Act;
(h) Trade for any person deprived of the privilege of trading under the
Commodity Exchange Act;
(i) Accept an order or make a trade for the Manager, Assistant Manager, or
other employee of the Clearing House except in the exercise of their
official duties;
(j) Fail to comply with an order or award of the Committee of Arbitration. 150
B. No member shall be directly or indirectly interested in or associated in
business with, or have his office directly or indirectly connected by
public or private wire or other method or contrivance with, or transact any
business directly or indirectly with or for
(a) Any bucket shop; or
(b) Any organization, firm, or individual making a practice of dealing on
differences in market quotations; or
(c) Any organization, firm or individual engaged in purchasing or selling
commodities or securities for customers and making a practice of taking the
side of the market opposite to the side taken by customers. 152 (08/01/94)
511.00 Trading on Other Exchanges - No member of this Association shall be
permitted to trade on any exchange in the City of Chicago whose Constitution,
By-Laws, Rules, or Regulations prescribe or
Ch5 Offenses
------------
limit the trading privileges of our members on our own Exchange. 608 (08/01/94)
512.00 Insolvency - (See 270.00) (08/01/94)
513.00 Announcement of Suspension - (See 271.00) (08/01/94)
514.00 Insolvent Member - (See 272.00) (08/01/94)
515.00 Investigation - (See 273.00) (08/01/94)
515.01 Insolvency - (See 273.01) (08/01/94)
516.00 Reinstatement - (See 274.00) (08/01/94)
517.00 Suspended Member - Time for Settlement - (See 276.00) (08/01/94)
518.00 Suspension for Default - (See 278.00) (08/01/94)
519.00 Decorum Offenses - Disorderly conduct, sexual harassment, intentional
physical abuse, the use of profane or obscene language, presence in restricted
areas, the commission of any other offenses as listed in Ruling 520.00A, or the
violation of any Regulation approved by the Board which relates to decorum on
the Exchange Floor is a decorum offense. The penalty for any such offense may be
a warning, a fine not to exceed $5,000, and/or denial of the privilege of the
Floor for a period not exceeding five (5) days, as determined by the Floor
Conduct Committee. Such denial shall not be considered to be a suspension.
Except in the case of a minor penalty pursuant to Regulation 519.01 for which no
hearing has been requested, the Floor Conduct Committee shall proceed in
accordance with Regulations 540.02 through 540.05. The decision of the Floor
Conduct Committee may be appealed to the Appellate Committee as provided in
Regulation 519.02(d). (01/01/96)
519.00A Unauthorized entry into the trading areas (see 310.01) shall be deemed
to constitute presence in restricted areas. (08/01/94)
519.01 Committee Procedure -
(a) FLOOR CONDUCT COMMITTEE.
(i) The Floor Conduct Committee may impose minor penalties against members
for decorum offenses committed by such members or by any person or
persons for whom such members are responsible. The Floor Conduct
Committee may impose minor penalties for the offenses set forth in
Regulation 520.00A. Minor penalties for the purpose of this Regulation
shall be defined as a warning, fines not exceeding $5,000 for any one
offense and/or access denial not to exceed five days. A respondent may
request a hearing by filing a written request for a hearing with the
Exchange Services Department within ten (10) business days after the
penalty is imposed; the Floor Conduct Committee shall hear the matter
in accordance with Regulation 540.02 through 540.05. The decision of
the Floor Conduct Committee may be appealed to the Appellate Committee
as provided in Regulation 519.02(d). Failure to request a hearing
shall be deemed a consent to the warning or fine. Unless a hearing is
requested, if a fine is not paid within thirty (30) days after it was
due, the Floor Conduct Committee may, without hearing, revoke the
badge or suspend the floor privileges of a floor clerk for whose
conduct the fine was imposed.
(ii) The Floor Conduct Committee pursuant to this Regulation may impose
minor penalties for disorderly conduct, intentional physical abuse,
sexual harassment and the use of profane or obscene language. The
Floor Conduct Committee, in its discretion, may impose a fine not to
exceed $5,000, in addition to any access denial, for any violation
within its jurisdiction regardless of the number of the offense.
(iii) Any member or individual with floor access privileges who has received
a Floor Conduct Committee Notice of Rule(s) Violation ("ticket") for a
decorum offense of Disorderly Conduct, Intentional Physical Abuse,
Sexual Harassment and/or Use of Profane or Obscene Language
Ch5 Offenses
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and, during the same trading session, engages in a further Rule or
Regulation violation relating to Disorderly Conduct, Intentional
Physical Abuse, Sexual Harassment and/or Use of Profane or Obscene
Language may, in addition to other sanctions (including, but not
limited to, fines, suspensions and expulsions imposed by the
Association pursuant to the Rules and Regulations) be immediately and
summarily removed from the Exchange trading floor and denied trading
floor access for the remainder of the trading session pursuant to the
following procedures:
(1) Certification by the Chairman of the Pit Committee (or, in the
Chairman's absence, by a Vice Chairman of the Pit Committee)
that the individual has continued to engage in Disorderly
Conduct, Intentional Physical Abuse, Sexual Harassment and/or
Use of Profane or Obscene Language after having previously
received a Floor Conduct Committee Notice of Rule (s) Violation
("ticket") for the same offense in the same trading session; and
(2) Approval of such summary action by a member of the Floor
Governors Committee and a member of the Board of Directors or by
two members of the Board of Directors, provided that no
individual granting such approval shall have been involved in
the altercation.
Additionally, should the first such offense be of such a serious nature, the
individual similarly may be denied trading floor access for the duration of the
trading session pursuant to the above procedure.
(b) FLOOR GOVERNORS COMMITTEE.
(i) The Floor Governors Committee may, without hearing, impose minor
penalties against members or member firms for bracketing violations or
for violations involving the accurate and complete maintenance of
books and records, including the submission of Computerized Trade
Reconstruction Data, within its jurisdiction committed by such
members, member firms, or by any person or persons for whom such
members or member firms are responsible. Minor penalties for the
purpose of this subparagraph shall be defined as fines not exceeding
$1,000 for any one offense.
(ii) Following is the schedule of minor penalties the Floor Governors
Committee may impose pursuant to subparagraph (i); however, this
schedule is non-binding, and the Floor Governors Committee, in its
discretion, may impose a fine not to exceed $1,000 for any violation
within its jurisdiction regardless of the number of the offense:
---------------------------------------------------------------------
ERRORS OR OMISSIONS IN BRACKETING 1st Offense $ 100 fine
-----------------------------
TRADES: 2nd Offense $ 250 fine
-----------------------------
3rd Offense $ 500 fine
-----------------------------
4th Offense $1,000 fine
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ERRORS OR OMISSIONS IN SUBMISSION OF 1st Offense $ 100 fine
-----------------------------
COMPUTERIZED TRADE RECONSTRUCTION 2nd Offense $ 250 fine
-----------------------------
DATA: 3rd Offense $ 500 fine
-----------------------------
4th Offense $1,000 fine
---------------------------------------------------------------------
(iii) The Floor Governors Committee may, without hearing, impose minor
penalties against members for intra-association or contiguous
association trading in excess of the percentages permitted by the
Board pursuant to Regulation 330.03. Minor penalties for the purpose
of this subparagraph shall be defined as fines not exceeding $5,000
for any one offense.
(iv) Following is the schedule of minor penalties the Floor Governors
Committee may impose pursuant to subparagraph (iii); however, this
schedule is non-binding, and the Floor Governors Committee, in its
discretion, may impose a fine not to exceed $5,000 for any violation
within its jurisdiction regardless of the number of the offense
Ch5 Offenses
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---------------------------------------------------
1st Offense $ 500 fine
---------------------------------------------------
2nd Offense within 24 months $1,000 fine
---------------------------------------------------
3rd Offense within 24 months $2,500 fine
---------------------------------------------------
Any subsequent offense within 24 months $5,000 fine
---------------------------------------------------
(v) At the time of an offense of the type set forth in subparagraphs (i)
or (iii), or as soon thereafter as practical, a representative of
the Office of Investigations and Audits, shall upon the
authorization of one member of the Floor Governors Committee, issue
a ticket to the offender notifying the member or member firm that
the Floor Governors Committee may impose a summary penalty in
accordance with this regulation or may issue charges against the
member or member firm and impose penalties as authorized in Rule
543.00. A representative of the Office of Investigations and Audits
shall submit a copy of the ticket to the Floor Governors Committee.
The Committee shall then determine whether to summarily impose a
minor penalty or to issue charges. The Committee shall also have the
authority to summarily impose minor penalties or to issue charges
for the types of offenses set forth in subparagraphs (i) or (iii) on
the basis of reports presented to the Committee by the Office of
Investigations and Audits.
(vi) A respondent may request an appeal of a minor penalty by filing a
written request for a hearing with the Office of Investigations and
Audit within ten (10) business days after the penalty is imposed;
the Floor Governors Committee shall hear the matter in accordance
with Regulations 540.02 through 540.05. The decision of the Floor
Governors Committee maybe appealed to the Appellate Committee as
provided in Rule 540.00 (e). Failure to request a hearing shall be
deemed a consent to the fine.
(vii) Whenever the Floor Governors Committee summarily imposes a minor
penalty against a member or member firm, the member or member firm
shall be given written notification of the penalty. The notice shall
inform the member or member firm of the right to appeal the penalty
to the Committee and the consequences of a failure to pay a fine if
no hearing is requested.
(viii) Nothing contained herein shall be construed to limit or restrict the
powers and authority of the Floor Governors Committee. (01/01/97)
519.02 Floor Conduct Committee -
(a) The Chairman of the Association may, with the consent of the Board, appoint
members to a Floor Conduct Committee. Members of the Committee may not be
members of the Floor Governors Committee.
(b) Meetings. The Floor Conduct Committee shall determine the time and place of
its meetings and the manner and form in which such meetings shall be
conducted. In the interest of efficiency, the Chairman of the Floor Conduct
Committee may appoint panels of Floor Conduct Committee members to hold duly
constituted meetings. Any such panel shall consist of three or more members
of the Floor Conduct Committee. The majority vote of such a panel of the
Committee shall be the official act or decision of the Committee. The
Chairman of the Floor Conduct Committee shall determine for each meeting, in
his or her sole discretion, whether a panel or the full Floor Conduct
Committee shall convene.
(c) Duties of Committee. It shall be the function and duty of the Floor Conduct
Committee to ensure decorum on the Floor of the Exchange in regard to
decorum offenses set forth in Regulations 520.00A, 519.00A, 519.05 and
519.07 and in accordance with Rule 519.00 and Regulation 519.01. Floor
Conduct Committee members shall issue a ticket to an offender notifying him
that the Floor Conduct Committee has imposed a warning or fine as described
in Regulations 520.00A, 519.00A and/or 519.05 and in accordance with Rule
519.00 and Regulation 519.01 for such violations which occur in the trading
pits, including the steps leading into the pit. The ticket requires the
signature of two members of the Floor Conduct Committee.
The Committee shall have the authority to discipline a member or other
person with trading privileges found to have violated any Rule or Regulation
within its jurisdiction by reprimand, by denial of the
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privileges of the Floor of the Exchange not to exceed five (5) days and/or
by the imposition of a fine not to exceed $5,000.
The Chairman and Vice Chairman of the Pit Committee shall be considered
members of the Floor Conduct Committee for the sole purpose of issuing
tickets for decorum offenses within their pit.
The Floor Conduct Committee shall be responsible for issuing badges to and
recalling badges from all non-members, except as otherwise provided within
the Rules and Regulations.
(d) Appeal. A member, member firm, or other person with floor privileges, may
appeal from the decision of the Committee by filing with the Secretary of
the Association, within ten business days after the Committee's decision is
sent to the respondent, a Notice of Appeal to the Appellate Committee
requesting a review by the Appellate Committee of all or part of the
Committee's decision.
(e) Offense Against the Association. Any member of the Association, member firm,
or other person with floor privileges who fails to comply with the
disciplinary action of the Committee after such action becomes effective
shall be charged with an offense against the Association, and if found
guilty, shall either be fined, suspended, or expelled by the Board.
(f) Hold-over Member. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding, and the term of one or more
of the members expires, such member or members may continue in office until
the proceeding has ended. A hold-over member shall not participate in any
other Committee business, nor shall his continuation in office impair the
appointment of his successor or his successor's right to participate in all
other Committee business. (01/01/96)
519.03 Bracketing Violations - The Floor Governors Committee may levy fines
for violations of Regulation 332.02, pertaining to the recording of bracket
data, in accordance with the Summary Procedures as provided in Regulation
519.01(b). (08/01/94)
519.04 Pit Committee Supervision and Enforcement of Pit Decorum - It shall be
the function and duty of each Pit Committee to supervise and enforce any and all
Decorum Offenses within its particular pit. (See 360.01.) The Pit Committees'
authority is meant to supersede and replace the authority of the Floor Conduct
Committee for Decorum Offenses committed within the respective trading pits. The
Floor Conduct Committee maintains jurisdictional authority for any and all
Decorum Offenses that occur outside of the respective trading pits. (03/01/97)
519.05 Weapons Prohibition - No weapons shall be permitted on the Exchange
Floor or in the lobby area adjacent to the Exchange Floor. Any violation of this
Regulation shall be deemed a decorum offense and penalties may be imposed
pursuant to Rule 519.00 and Regulation 519.01. (08/01/94)
519.06 Submission of Computerized Trade Reconstruction Data - The Floor
Governors Committee may levy fines for violations of Regulation 545.02, 332.04,
332.041, 332.05, 332.06, 332.07, 332.08, and 332.09, pertaining to the accurate
and complete maintenance of books and records, including the submission of
Computerized Trade Reconstruction data, in accordance with the Summary
Procedures as provided in Regulation 519.01(b). (07/01/95)
519.07 Sexual Harassment - Sexual harassment will not be tolerated on the
Floor or Halls of the Exchange. Sexual harassment consists of unlawful verbal or
physical conduct directed at a person when that conduct is based on that
person's sex and has a substantial adverse effect on him or her in the
workplace. Such conduct may include, but is not limited to, the following:
1. requests for sexual favors that may or may not be accompanied by threats or
promises of preferential treatment with respect to an individual's
employment status;
2. verbal, written or graphic communications of a sexual nature, including
lewd or sexually suggestive comments, off-color jokes of a sexual nature or
displays of sexually explicit pictures, photos, posters, cartoons, books,
magazines or other items; and
3. patting, pinching, hitting or any other unnecessary contact with another
person's body or threats to take such action.
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Any violation of this Regulation shall be deemed a decorum offense and penalties
may be imposed pursuant to Rule 519.00 and Regulation 519.01. (01/01/96)
520.00 Smoking - Smoking of cigarettes and other smoking materials is
prohibited in the Exchange Halls (during trading hours or business days). Any
member, or any person affiliated with a registered eligible business
organization who violates this Rule shall be guilty of an offense against the
Association and, in the case of persons affiliated with a registered eligible
business organization, such firm may also be found guilty of an offense against
the Association. 164 (04/01/98)
520.00A Exchange Floor Fines - The Secretary of the Association shall impose a
fine of $25 to $5,000, as directed by the Floor Conduct Committee for each
violation of Rules, Regulations, directives or guidelines issued by the Floor
Conduct Committee relating to smoking and other use of tobacco products, badges,
food and beverage, dress code, decorum, and guests and visitors on the Exchange
Floor.
The following schedule of fines is approved; however, this schedule is non-
binding, and the Floor Conduct Committee, in its discretion, may impose a fine
not to exceed $5,000, in addition to any access denial, for the violations set
forth below regardless of the number of the offense.
-------------------------------------------------------------------------------
BADGES: (improper usage) 1st offense $25.00
-------------------------------------------------------------------------------
2nd offense $50.00
-------------------------------------------------------------------------------
3rd offense denial of access to the
Floor
===============================================================================
(Failure to display Exchange issued $200.00 each offense
badge)
-------------------------------------------------------------------------------
(unauthorized entry into pits) 1st offense $100.00
-------------------------------------------------------------------------------
2nd offense $200.00
-------------------------------------------------------------------------------
3rd offense $500.00
===============================================================================
(unauthorized usage of a key card) 1st offense $1,000.00
-------------------------------------------------------------------------------
2nd offense denial of Floor access
===============================================================================
SMOKING/USE OF TOBACCO PRODUCTS: 1st offense $100.00
-------------------------------------------------------------------------------
2nd offense $200.00
-------------------------------------------------------------------------------
3rd offense $500.00
-------------------------------------------------------------------------------
4th offense disciplinary action
===============================================================================
FOOD AND BEVERAGE: 1st offense $50.00
-------------------------------------------------------------------------------
2nd offense $100.00
-------------------------------------------------------------------------------
additional offense by individual -
$500.00
===============================================================================
GUESTS AND VISITORS: 1st offense $25.00
-------------------------------------------------------------------------------
2nd offense $50.00
-------------------------------------------------------------------------------
3rd offense $100.00
===============================================================================
DRESS CODE: 1st offense $25.00
-------------------------------------------------------------------------------
2nd offense $50.00
-------------------------------------------------------------------------------
3rd offense $100.00
-------------------------------------------------------------------------------
No jeans are to be permitted on the
Exchange Floor.
===============================================================================
RUNNING: 1st offense by individual - $25.00
-------------------------------------------------------------------------------
2nd offense by individual - $50.00
-------------------------------------------------------------------------------
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-------------------------------------------------------------------------------
3rd offense by individual - $75.00
-------------------------------------------------------------------------------
4th offense by individual - $100.00
===============================================================================
PROPERTY OFFENSES: 1st offense $200.00
-------------------------------------------------------------------------------
2nd offense $500.00
===============================================================================
THROWING OF OBJECTS: 1st offense $50.00
-------------------------------------------------------------------------------
2nd offense $200.00
-------------------------------------------------------------------------------
3rd offense $500.00
===============================================================================
The procedure for the imposition of a fine shall be as follows:
As set forth in Regulation 519.02(c), Floor Conduct Committee members shall
issue a ticket to an offender for offenses which occur in the trading pits,
including the steps leading into the pit. The ticket requires the signature of
two Committee members.
Security guards shall issue tickets for offenses which occur outside the
boundaries of the trading pits and the entrance area to the Exchange Floor.
A guard shall take the name of the offender and submit it to the Floor Conduct
Committee. The Committee may issue a directive to the Secretary of the Exchange
to impose a fine in the amount stated in the directive. The directive shall be
signed by two members of the Floor Conduct Committee. Fines for offenses may be
imposed on a member committing a violation, or upon a member or member firm for
a violation committed by an employee of such member or member firm.
The Secretary of the Exchange shall give the member or member firm written
notification of the fine. The notice shall inform the member or member firm of
the right to request a hearing and the consequences of a failure to pay the fine
if no hearing is requested.
Property offenses, for the purpose of this Ruling 520.00A, shall include sitting
or standing on floor booths, standing on chairs or stools on the trading floor,
extending telephone cords across an aisle, defacing property, or any other
action which may damage property or impede communications or traffic on the
trading floor. The privilege of the Floor will be denied, for a period of time
as determined by the Floor Conduct Committee, for extending a telephone cord
into a pit.
For purposes of this Ruling, the fine shall have been imposed as of the date
that the written notice is delivered to the member or member firm. (02/01/95)
521.00 Floor Access - Upon receipt by the Association of actual notice that
any member or registered eligible business organization, or any other person
with trading privileges, has entered a plea of guilty to or has been adjudged
guilty of a violation of any criminal statute involving moral turpitude, the
Chairman of the Board may order an investigation (unless already in progress) to
ascertain whether violations of the Rules and Regulations have occured, and the
Board may, when immediate action is necessary to protect the best interests of
the marketplace, and subject to the provisions of Regulation 540.06, forthwith
deny access to the trading floor to such person or registered eligible business
organization until the investigation, including any disciplinary proceedings, is
concluded.
The issues in a Regulation 540.06 hearing under this Rule are limited to (1)
whether or not the member or registered eligible business organization, or other
person with trading privileges, has entered a plea of guilty to or has been
adjudged guilty of a violation of any criminal statute involving moral
turpitude, and (2) whether or not immediate action is necessary to protect the
best interests of the marketplace. (04/01/98)
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540.00 Proceedings Before The Board - The Board may review decisions of the
Appellate Committee, and may agree to hear disciplinary matters referred to it
by the Appellate Committee or the Hearing Committee. Whenever the respondent
shall have had an opportunity to present evidence or legal defenses in
connection with the pending matter before any Standing or Special Committee in
accordance with Regulations 540.02 and 540.03, and the jurisdiction of the Board
is based upon either an appeal by the respondent from the decision of such
Committee or is a referral of the matter by such Committee to the Board, the
Board shall not entertain any new evidence or new legal defenses not raised
before such Committee except upon a clear showing by the respondent that such
new evidence or new legal defense did not exist or was not ascertainable by due
diligence at the time of the Committee proceedings, and that there was
insufficient time within the intervening period prior to the hearing of the
Board for the respondent to bring such new evidence or legal defense to the
attention of such Committee.
After hearing all the witnesses and the respondent, if he desires to be heard,
the Board shall determine whether to affirm, reverse, modify or remand the
decision of the Committee under review and may impose penalties in accordance
with Rule 560.00. The finding of the Board shall be final and conclusive when
rendered.
If the respondent has not been given notice and opportunity for hearing,
pursuant to Regulations 540.02 and 540.03, before a disciplinary committee, the
Board may, rather than holding a hearing remand the matter to the appropriate
disciplinary committee. 155 (08/01/94)
540.00A Committee Authority To Refer Matters for Investigation - Any
Committee of the Association which in the course of its activities discovers a
possible violation of the Rules and Regulations of the Association may, refer
the matter to the Office of Investigations and Audits or the appropriate
disciplinary committee. 39R (08/01/94)
540.01 Review Of Investigation Report - The disciplinary committee shall
promptly review each investigation report. In the event the disciplinary
committee determines that additional investigation or evidence is needed, it
shall promptly direct the enforcement staff to conduct its investigation
further. Within a reasonable period of time not to exceed 30 days after the
receipt of a completed investigation report, the disciplinary committee shall
take one of the following actions:
(a) If the disciplinary committee determines that no reasonable basis exists
for finding a violation or that prosecution is otherwise unwarranted, it
may direct that no further action be taken. Such determination must be in
writing and contain a brief statement setting forth the reasons therefor.
(b) If the disciplinary committee determines that a reasonable basis exists for
finding a violation which should be adjudicated, it shall direct that the
person alleged to have committed the violation be served with a notice of
charges and shall proceed in accordance with these regulations. (08/01/94)
540.02 Notice and Answer in Connection with Disciplinary Proceedings -
(a) Prior to the imposition of any penalty by the Board of Directors or a
committee under the Rules and Regulations, the respondent shall be served
with a statement of charges either personally or by leaving the same at his
or its office address during business hours or by mailing it to him at his
place of residence, which charges shall:
(1) State the acts, practices, or conduct in which the respondent is
believed to have engaged;
(2) State the Rule or Regulations believed to have been violated;
(3) Advise the respondent that he or it is entitled to be represented by an
attorney;
(4) Advise the respondent that he or it is entitled to a hearing.
(5) State the period of time, which in no event shall be less than five (5)
business days after the service of the charges, within which a hearing
on the charges may be requested;
(6) Advise the respondent that failure to request a hearing within the
period stated, except for good
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cause, shall be deemed a waiver of the right to a hearing; and
(7) State the penalty which will be imposed if a hearing is waived.
(b) If the respondent elects to answer the charges, such answer shall be filed
within five (5) business days after the date of service of the charges, or
within such further time as the Board of Directors or the appropriate
Committee in its discretion deems proper.
The answer shall be in writing, signed by the respondent, and filed with
the Office of Investigations and Audits; except that in connection with
proceedings initiated under Rule 519.00 or Regulation 519.01 by the Floor
Conduct Committee, such answers shall be filed with the Exchange Services
Department. (08/01/94)
540.03 Procedures for Hearings on Charges - In connection with all hearings
on charges, except those held pursuant to Regulation 540.05:
(a) The respondent shall be entitled in advance of the hearing to examine all
books, documents, or other tangible evidence in the possession or under
the control of the Association which is to be relied upon by the Office of
Investigations and Audits or Exchange Services Department in presenting
the charges contained in the notice of charges or which are relevant to
those charges;
(b) At least ten (10) business days in advance of the hearing, the respondent
shall submit to the Office of Investigations and Audits copies of all
documents which the respondent intends to rely on in presenting his case
and shall provide the Office of Investigations and Audits with a list of,
and make available for inspection by the Office of Investigations and
Audits, all books, records, names of witnesses, and other tangible
evidence which the respondent intends to rely on; except that in any
hearing held pursuant to Rule 519.00 or Regulation 519.01 by the Floor
Conduct Committee, the documents and lists shall be submitted to and the
books, records and other tangible evidence shall be made available for
inspection by the Exchange Services Department. The hearing body, in its
discretion, may refuse to consider any books, records, documents or other
tangible evidence which was not made available or witnesses whose names
were not submitted to the Office of Investigations and Audits, or the
Exchange Services Department pursuant to this section. However, the
hearing body will consider such evidence upon a clear showing that such
evidence was not ascertainable by due diligence at least ten (10) business
days in advance of the hearing and that there was insufficient time prior
to the hearing to bring such evidence to the attention of the Office of
Investigations and Audits or the Exchange Services Department.
(c) The hearing shall be promptly held before disinterested members of the
hearing body after reasonable notice to the respondent. No member of a
disciplinary body may serve on that body in a particular matter if he or
any person or firm with which he is affiliated has a financial, personal
or other direct interest in the matter under consideration.
(d) Formal rules of evidence need not apply, but the hearing shall not be so
informal as to be unfair;
(e) The respondent shall have the right to invoke Rule 548.00, if applicable;
(f) The Office of Investigations and Audits shall be a party to the hearing
and shall present its case on those charges and penalties which are the
subject of the hearing; or in the case of any hearing held pursuant to
Rule 519.00 or Regulation 519.01 by the Floor Conduct Committee, the
Exchange Services Department shall be a party to the hearing and shall
present its case on those charges and penalties which are the subject of
the hearing.
(g) The respondent shall be entitled to appear personally at the hearing and
to be represented by counsel;
(h) The respondent shall be entitled to cross-examine any person(s) appearing
as witness(es);
(i) Subject to the provisions of Rule 540.00, the respondent shall be entitled
to call witnesses and to present such evidence as may be relevant to the
charges;
(j) Persons within the jurisdiction of the Association who are called as
witnesses shall be obliged to appear at the hearing and to produce
evidence (see 545.00);
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(k) If the hearing is held at the request of the respondent, a substantially
verbatim record of the hearing, capable of being accurately transcribed,
shall be made and shall become part of the record of the proceeding.
(10/01/95)
540.04 Disciplinary Decisions - All disciplinary decisions rendered pursuant to
the Rules and Regulations shall be in writing and be based upon the weight of
the evidence contained in the record of the proceeding. A copy of the decision
shall be provided to the respondent and shall include:
(a) The charges, or a summary of the charges;
(b) The answer, if any, or a summary of the answer;
(c) A brief summary of the evidence produced at the hearing or, where
appropriate, incorporation by reference of the investigation report;
(d) A statement of findings and conclusions with respect to each charge,
including the specific Rules and Regulations which the respondent is found
to have violated;
(e) A declaration of any penalty imposed and the effective date of the
penalty;
(f) A statement that the respondent shall pay the cost of the transcription of
the record of the hearing if an appeal or petition for review to the
Commission is requested by the respondent.
All such decisions shall be rendered within thirty business days after the
conclusion of the hearing, unless, by virtue of the complexity of the case or
other special circumstances, additional time is required. (08/01/94)
540.05 Appeals from a Decision of a Disciplinary Committee - The following
procedures shall apply to appeals to the Appellate Committee and the Board from
the decisions of any Committee from which appeals are allowed under the Rules
and Regulations.
(a) An appeal by the respondent from the decision of a committee or a referral
of the matter by such committee to the Appellate Committee shall be heard
by the Appellate Committee as provided in Regulations 540.02 and 540.03.
Provided, however, that whenever the respondent shall have had an
opportunity to present evidence or legal defenses in connection with the
pending matter before any Standing or Special Committee in accordance with
Regulations 540.02 and 540.03, the appeal shall be heard solely on the
record of the proceedings before such committee, the written exceptions
filed by the parties and the oral or written arguments of the parties.
Further, the Appellate Committee shall not entertain any new evidence or
new legal defenses not raised in the prior proceeding except upon a clear
showing by the respondent that such new evidence or new legal defense did
not exist or was not ascertainable by due diligence at the time of the
proceedings, and that there was insufficient time within the intervening
period prior to the hearing of the Appellate Committee for the respondent
to bring such new evidence or legal defense to the attention of the
committee.
The Appellate Committee shall not reverse any finding of a Standing or
Special Committee or reverse or reduce any sanction imposed by a Standing
or Special Committee unless the Appellate Committee determines that the
finding or sanction is "clearly erroneous."
(b) Subject to the provisions of Rule 540.00, an appeal shall be heard by the
Board solely on the record before the Committee, the written exceptions
filed by the parties; and the oral and written arguments of the parties;
(c) Within thirty days after the conclusion of the hearing of the appeal, or
within such additional time as may be necessary by virtue of the
complexity of the case or other special circumstances, the Appellate
Committee or the Board shall issue a written decision and provide a copy
to the respondent. The decision shall include a statement of findings and
conclusions with respect to each charge or penalty reviewed, including the
specific rules which the respondent was found by the Committee to have
violated, and the effective date of the disciplinary penalties, if
affirmed, or of any modified penalties.
(d) No member of the Board or Appellate Committee shall hear an appeal if such
member participated in any prior stage of the disciplinary proceeding or
if he or any person or firm with which he is affiliated
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has a financial, personal, or other direct interest in the matter.
(10/01/97)
540.06 Procedures For Member Responsibility Actions - The Chairman or Acting
Chairman of the Association, upon the advice of the Floor Governors Committee,
Financial Compliance Committee or Business Conduct Committee, has jurisdiction
to take summary action when immediate action is necessary to protect the best
interests of the marketplace or membership, without affording an opportunity for
a prior hearing ("member responsibility actions"). The following procedures
shall apply to such actions:
(a) The respondent shall, whenever practicable, be served with a notice before
the action is taken. If prior notice is not practicable, the respondent
shall be served with a notice at the earliest possible opportunity. The
notice shall:
(1) State the action;
(2) Briefly state the reasons for the action, and
(3) State the effective time and date and the duration of the action;
(b) The respondent shall have the right to be represented by legal counsel or
any other representative of his choosing in all proceedings subsequent to
any summary action taken;
(c) The respondent shall be given an opportunity for a subsequent hearing,
within five business days, before the Floor Governors Committee, Financial
Compliance Committee or the Business Conduct Committee. The hearing shall
be conducted in accordance with the requirements of Regulation 540.03 (c)-
(j);
(d) Within five business days following the conclusion of the hearing, the
body before which the hearing is held shall render a written decision
based upon the weight of the evidence contained in the record of the
proceeding and shall provide a copy to the respondent. The decision shall
include:
(1) A description of the summary action taken;
(2) The reasons for the summary action;
(3) A brief summary of the evidence produced at the hearing;
(4) Findings and conclusions;
(5) A determination that the summary action should be affirmed, modified,
or reversed; and
(6) A declaration of any action to be taken pursuant to the determination
specified in (5) above and the effective date and duration of such
action.
The Chairman or Acting Chairman of the Association has jurisdiction to reverse
summary action taken against an individual member pursuant to Rule 270.00 or
Rule 278.00, or against a member firm pursuant to Regulation 416.04, at any time
prior to a hearing held pursuant to this Regulation, or, if no hearing is held,
prior to the expiration of five business days after the summary action is taken,
without the prior approval of the Financial Compliance Committee or the Business
Conduct Committee, if the affected member or member firm demonstrates to the
satisfaction of the Chairman or Acting Chairman that the condition which was the
basis for the action no longer exists. (07/01/97)
540.07 Finality Of Disciplinary Decisions And Member Responsibility Actions -
All disciplinary decisions rendered or member responsibility actions taken
pursuant to the Rules and Regulations shall be final and conclusive when
rendered, unless appealable, in which case the decision shall become final the
first business day after the time for appeal has passed, if no appeal is taken,
or when the decision of the appeals body is rendered.
The person or body rendering such decision shall determine the effective date of
such action. Provided, however, that the effective date shall be at least
fifteen (15) days after written notice is delivered to the person against whom
the action is taken, and to the Commodity Futures Trading Commission, except
that such action may become effective prior to that time if:
(1) The action was taken according to the provisions of Regulation 540.06;
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(2) The person against whom the action is taken has consented to the sanction
to be imposed; or
(3) The action was taken by the Secretary under Rule 563.00. (08/01/94)
540.08 Offers of Settlement - Any member, member firm or other person who is
the subject of charges filed before the Board or who has filed an appeal of a
disciplinary action with the Board, may submit a written offer of settlement in
connection with such proceedings to the President. The President is authorized
to consider such settlement offers, negotiate alternative provisions therein,
and recommend to the Board that it either accept or reject any settlement offer.
The Board, by majority vote of a duly convened quorum, has the sole authority to
accept or reject any such settlement offer. If an offer of settlement is
accepted by the Board, it shall issue a written decision specifying the rule
violations it has reason to believe were committed and any penalty to be
imposed. Where applicable, the decision also shall include a statement that the
respondent has accepted the penalties imposed without either admitting or
denying the rule violations.
The member, member firm or other person who submits a written settlement offer
to the President may withdraw it at any time before final acceptance by the
Board. If a settlement offer is withdrawn or is rejected by the Board, the
person submitting such offer neither shall be deemed to have made any admission
nor shall in any manner be prejudiced by having submitted the settlement offer.
Any member, member firm or other person who is the subject of charges before the
Appellate Committee or who has filed an appeal of a disciplinary action with the
Appellate Committee, may submit a written offer of settlement in connection with
such proceedings to the Appellate Committee. The Appellate Committee is
authorized to consider such settlement offers, negotiate alternative provisions
therein, and either accept or reject any settlement offer. If an offer of
settlement is accepted by the Committee it shall issue a written decision
specifying the rule violations it has reason to believe were committed and any
penalty to be imposed. Where applicable, the decision shall also include a
statement that the respondent has accepted the penalties imposed without either
admitting or denying the rule violations.
The member, member firm or other person who submits a written settlement offer
to the Appellate Committee may withdraw it at any time before final acceptance
by the Committee. If a settlement offer is withdrawn or rejected by the
Committee, the person submitting such offer neither shall be deemed to have made
any admission nor shall in any manner be prejudiced by having submitted the
settlement offer.
Each settlement offer presented to the Board or to the Appellate Committee shall
be deemed to incorporate the following terms:
(1) Respondent acknowledges that the Office of Investigations and Audits will
have the opportunity to present its views on the proposed settlement to
the President, the Board, or the Appellate Committee, as applicable; and
(2) Respondent waives any objection to having the Board or the Appellate
Committee, as applicable, hear the case even it the Board or the Appellate
Committee has previously considered and rejected a settlement offer.
(08/01/97)
540.09 Offers of Settlement - Any member, member firm, their wholly-owned
affiliates or other person who is the subject of preliminary charges issued by
the Business Conduct Committee, Financial Compliance Committee or Floor
Governors Committee ("respondent"), may submit a written offer of settlement in
connection with such proceedings to the Business Conduct Committee, Financial
Compliance Committee, Floor Governors Committee or the Hearing Committee. The
Business Conduct Committee, Financial Compliance Committee, Floor Governors
Committee and Hearing Committee are authorized to consider such settlement
offers, negotiate alternative provisions therein, and either accept or reject
any settlement offer. When preliminary charges are pending before the Hearing
Committee, before a hearing begins, the Committee that issued the charges has
the sole authority to consider settlement offers. Once the Hearing Committee has
begun hearing evidence, the Hearing Committee has exclusive settlement
authority. The Business Conduct Committee, Financial Compliance Committee, Floor
Governors Committee and Hearing Committee may, in their discretion, permit a
respondent to accept a penalty without either admitting or denying any rule
violations upon which the penalty is based. If an offer
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of settlement is accepted by any such Committee, it shall issue a written
decision specifying the rule violations it has reason to believe were committed
and any penalty to be imposed. Where applicable, the decision also shall include
a statement that the respondent has accepted the penalties imposed without
either admitting or denying the rule violations.
Each settlement offer presented to any such Committee shall be deemed to
incorporate the following terms:
(1) Respondent acknowledges that the Office of Investigations and Audits will
have the opportunity to present its views on the proposed settlement to
the Committee; and
(2) Respondent waives any objection to having the appropriate Committee hear
the case even if that Committee has previously considered and rejected a
settlement offer.
The member, member firm, wholly-owned affiliate or other person who submits a
written settlement offer to any such Committee may withdraw it at any time
before final acceptance by the Committee. If a settlement offer is withdrawn or
rejected by any such Committee, the person submitting such offer neither shall
be deemed to have made any admission nor shall in any manner be prejudiced by
having submitted the settlement offer. (08/01/97)
540.10 Disciplinary Jurisdiction Over Agricultural Regular Firms - In addition
to the disciplinary authority of the Hearing Committee, Appellate Committee,
Business Conduct Committee and Financial Compliance Committee over agricultural
regular firms, as set forth in paragraphs (f) and (g) of Rule 542.00 and
paragraphs (f) and (g) of Rule 551.00, each of these Committees may discipline
an agricultural regular firm for violation of any Rules and Regulations by
imposing a fine on such firm, and/or by revoking the firm's regularity status.
Subject to and in accordance with Regulation 540.08, an agricultural regular
firm that is the subject of charges filed before the Board or that has filed an
appeal of a decision with the Appellate Committee or the Board, may submit a
written offer of settlement in connection with such proceeding to the Appellate
Committee or, in matters before the Board, to the President of the Association.
(08/01/94)
540.11 Appellate Committee -
(a) Membership. Each year the Chairman of the Board, with the approval of the
Board, shall appoint from those members of the Association who currently
serve or who shall have previously served as an elective officer of the
Association and who shall not be a member of a standing disciplinary
committee, to serve as a member of the Appellate Committee. The Committee
shall consist of five (5) members, at least one of whom is currently an
elective officer of the Association. A vacancy in the Committee shall be
filled by appointment by the Chairman of the Board, with the approval of
the Board.
(b) Meetings and Quorum. The Appellate Committee shall determine the time and
place for its meetings and the manner and form in which its meetings shall
be conducted. The attendance of three (3) Appellate Committee members
shall constitute a quorum of the Committee. The majority vote of the
quorum of the Appellate Committee shall be the official act or decision of
the Committee.
(c) Duties of the Committee. It shall be the function of the Committee to
serve as the appellate body in review of disciplinary decisions of
committees of the Association or, upon referral by such committee to hear
the matter, in accordance with Regulation 540.05. After hearing all the
witnesses and the respondent, if he/she decides to be heard, the Committee
shall determine whether the respondent is guilty of the offense or
offenses charged. If the Committee determines that the accused is guilty,
the Committee may impose penalties in accordance with Rule 560.00.
(d) Appeal. The findings of the Appellate Committee shall be final and
conclusive when rendered, although subject to review by the Board of
Directors in accordance with Regulation 540.05(b) upon the request of the
Board or upon referral by the Committee. A request that the Board review a
decision must be made:
- if on the motion of the Board, upon review of the notice of the decision
in the materials for the first regularly scheduled Board meeting not
less than twenty (20) days after the date of the
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decision;
- if by the Appellate Committee, within fifteen (25) days of the date of
the decision; and
- if by a person against whom the decision has been rendered within ten
(10) days of the date he receives the decision.
(e) Offense Against The Association. Any member of the Association, member
firm, or other person with trading privileges who fails to comply with the
disciplinary action of the Committee after such action becomes effective
shall be charged with an offense against the Association, and if found
guilty, shall either be fined, suspended or expelled by the Board.
(f) Oath. Every member of the Appellate Committee shall take an oath not to
divulge, or allow or cause to be divulged, any information acquired by
such member in his capacity as an Appellate Committee member if such
information is confidential, commercially sensitive, or non-public, except
when required in connection with disciplinary proceedings or other formal
proceedings or actions of a duly authorized committee of the Association
or of the Board, or in response to demand by an authority to obtain the
information requested, or on behalf of the Association in any proceeding
authorized by the Board of Directors.
(g) Holdover Member. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding and the term of the members
expires, the members may continue in office until the proceeding has
ended. A holdover member shall not participate in any other Committee
business, nor shall continuation in office impair the appointment of a
successor Committee or the successor Committee's right to participate in
all other Committee business.
(h) Associate Members as Appellate Committee Members. Associate Members of the
Exchange are eligible for appointment to the Appellate Committee as full
voting members, provided that such Associate Member qualifies pursuant to
paragraph (a) of this Regulation, and further provided that Associate
Members shall not be eligible to serve as Chairman of the Committee. The
Committee shall at no time have more than two Associate Members on the
Committee. (08/01/94)
540.12 Hearing Committee -
(a) Membership. The Hearing Committee shall consist of twenty-one (21)
individual members of the Association appointed each year by the Chairman
of the Board with the approval of the Board. For all purposes under these
Rules, the Hearing Committee shall be considered a disciplinary committee.
Hearing Committee members shall have previously served on the Board, the
Business Conduct Committee, the Floor Governors Committee, the Financial
Compliance Committee or the Arbitration Committee, but no person shall be
a member of the Committee who, at the same time, is a member of the Board
or any other standing disciplinary committee. A panel of seven members
shall be selected from the Committee for each hearing, in a manner
established by the Committee, consistent with the requirements of
Regulation 540.14. Each panel shall, by a majority vote, elect a Chairman.
(b) Hearing Executive Committee. The Chairman of the Board, with the approval
of the Board, shall appoint a Chairman of the entire Committee, along with
two other members from among the members of the Committee, to serve as a
Hearing Executive Committee.
(c) Meetings and Quorum. The Hearing Committee shall determine the time and
place of its meetings and the manner and form in which its meetings shall
be conducted. The attendance of four Hearing Committee members shall
constitute a quorum of the Committee. The majority vote of the quorum of
the Hearing Committee shall be the official act or decision of the
Committee.
(d) Duties of the Committee. The Hearing Committee shall conduct disciplinary
hearings pursuant to the Rules and Regulations of the Association.
Following notice and answer in accordance with Regulation 540.02, the
Hearing Committee shall conduct hearings in connection with proceedings
initiated under Rule 542.00(f), Rule 551.00(f) and Rule 543.00(d).
Procedures for the hearing shall be in accordance with Regulation 540.03.
After hearing all the witnesses and the respondent, if he/she decides to
be heard, the Committee shall determine whether the respondent is guilty
of the offense or offenses
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charged. If the Hearing Committee determines that the accused is guilty,
the Committee may impose penalties in accordance with the rule pursuant to
which the proceedings were initiated. In the event there is a finding of
multiple violations of any Rules or Regulations, it shall be within the
Committee's discretion to apply its suspension powers either in a
consecutive or concurrent manner.
(e) Appeal. A member, member firm, person with trading privileges or
agricultural regular firm may appeal from the decision of the Committee by
filing with the Secretary of the Association within ten (10) business days
after the Committee's decision is sent to the respondent a Notice of
Appeal to the Appellate Committee requesting a review by the Appellate
Committee of all or part of the Committee's decision.
(f) Offense Against the Association. Any member, member firm, other person
with trading privileges or agricultural regular firm who fails to comply
with the disciplinary action of the Committee after such action becomes
effective shall be charged with an offense against the Association, and if
found guilty, shall either be fined, suspended or expelled by the Board.
(g) Oath. Every Hearing Committee member shall take an oath not to divulge, or
allow or cause to be divulged, any information acquired by such member in
his official capacity as a Hearing Committee member if such information is
confidential, commercially sensitive, or nonpublic, except when required
in connection with disciplinary proceedings or other formal proceedings or
actions of a duly authorized committee of the Association or of the Board,
or in response to a request or demand by an administrative or legislative
body of government having jurisdiction of the subject matter and authority
to obtain the information requested, or on behalf of the Association in
any proceeding authorized by the Board of Directors.
(h) Hold-over Member. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding, and the term of one or
more of the members expires, such member or members may continue in office
until the proceeding has ended. A holdover member shall not participate in
any other Committee business, nor shall his continuation in office impair
the appointment of a successor or the successor's right to participate in
all other Committee business. (12/01/94)
540.13 Application of Rules and Regulations - The provisions of this Chapter
shall apply to all members, registered partnerships and corporations, their
wholly-owned affiliates, other persons with trading privileges, agricultural
regular firms, guaranteed introducing brokers, and any employee or Associated
Person of any such individual or firm, unless specifically exempted. (07/01/97)
540.14 Disciplinary Committee Composition -
(a) Notwithstanding any other provision of these rules, at least one member of
a major disciplinary committee (or panel of the Hearing Committee) shall
be a person who is not a member when that committee is acting with respect
to a disciplinary action in which:
(1) the subject of the action is a member of the Board, the Appellate,
Business Conduct, Financial Compliance or Floor Governors Committees;
or
(2) any of the charged, alleged or adjudicated rule violations involve:
(A) manipulation or attempted manipulation of the price of a
commodity, a futures contract or an option on a futures contract;
or
(B) conduct which directly results in financial harm to a non-member.
(b) Notwithstanding any other provision of these rules, a majority of each
major disciplinary committee shall be persons of membership categories
other than that of each subject of the proceeding. Each of the following
shall be considered a different membership category: (a) floor brokers,
(b) floor traders, (c) futures commission merchants, (d) producers,
consumers, processors, distributors and merchandisers (e) participants in
a variety of pits or principal groups of commodities or (f) other market
users or participants.
(c) Each major disciplinary committee shall include a diversity of membership
categories sufficient to
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ensure fairness and to prevent special treatment or preference for any
person in the conduct of that Committee's responsibilities.
(d) A major disciplinary committee is a panel of the Hearing Committee, the
Appellate Committee or, when reviewing a settlement offer, the Business
Conduct Committee, the Financial Compliance Committee or the Floor
Governors Committee, except in cases involving allegations which do not
involve fraud, deceit or conversion and which relate to:
(1) decorum or attire;
(2) financial requirements; or
(3) reporting or record keeping (08/01/94)
540.15 Failure to Pay a Disciplinary Fine - When the Treasurer of the
Association certifies to a Committee that imposed a fine that such fine is due
and has not been paid, the person who was ordered to pay the fine shall be
suspended from all membership privileges (including but not limited to floor and
electronic access, member transaction fees and the right to lease a membership
or membership interest), subject to Regulation 540.06, until the Treasurer
certifies to the Committee that the fine has been paid. (06/01/94)
541.00 Special Investigations By Board - If at any time the Board shall have
reason to suspect that any member, member firm, or other person with trading
privileges, has been guilty of any offense against the Association and no
investigation has been initiated into the matter, the Board shall direct the
Office of Investigations and Audits to conduct an investigation and shall direct
the appropriate disciplinary committee, or if necessary appoint a Special
Committee outside of its own number, to review the investigation as to whether
there is just ground for such suspicion. If the Committee decides that there is
just ground for such suspicion, it shall direct that charges be filed with the
Board as provided in Rule 540.00. (08/01/94)
542.00 Business Conduct Committee -
(a) Membership. The Chairman of the Board, with the approval of the Board,
shall appoint the members of the Business Conduct Committee. Only members
of the Association who are not Directors or Officers of the Association
shall be eligible for appointment as members of the Committee. All
Committee Members shall be Full Members except that one Committee Member
may be an Associate Member. Four members shall be appointed for staggered
three-year terms. Additional members may be appointed for one-year terms,
but no more than four such members may be appointed. Terms currently in
effect at the time of adoption of this amended Rule shall continue to be
in effect until they expire. At the time this amended Rule becomes
effective, a member shall be appointed to serve a term expiring February
1, 1984. Each year the Chairman of the Board shall appoint one member of
the Committee for a three-year term and may appoint no more than four
members for one-year terms, except that for February 1, 1984, and every
third year thereafter, the Chairman of the Board shall appoint two members
of the Committee for three-year terms and may appoint no more than four
members for one-year terms. A vacancy in the Committee shall be filled for
the unexpired term in the same manner as provided above, except that
unexpired one-year terms may be left vacant at the discretion of the
Chairman of the Board. The President shall be an ex officio member of the
Committee.
(b) Chairman and Vice-Chairman of the Committee. The Chairman of the Board,
with the approval of the Board, shall appoint a Chairman and a Vice-
Chairman of the Committee from among the members of the Committee. The
Chairman and Vice Chairman shall be appointed to serve as Chairman and
Vice Chairman for a one-year term.
(c) Oath of Members. Every member of the Committee shall take an oath not to
divulge, or allow or cause to be divulged, any information acquired by
such member in his official capacity if such information is confidential,
commercially sensitive or non-public, including any information regarding
the market position, financial condition, or identity of any trader or
firm, except when required in connection with his official duties, or in
connection with disciplinary proceedings or other formal
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proceedings or actions of a duly authorized committee of the Association,
or of the Board, or in response to a duly authorized subpoena, or in
response to a request or demand by an administrative or legislative body
of government having jurisdiction of the subject matter and authority to
obtain the information requested, or on behalf of the Association in any
proceeding authorized by the Board.
(d) Quorum. The attendance of three members at a meeting shall constitute a
quorum. The actions of a majority of the members present shall be the
actions of the Committee.
(e) Business Conduct Committee on Particular Matter. If the Business Conduct
Committee shall determine that it is improper for any or all of its
regular members to serve during the consideration and decision of any
particular matter, or if any or all the regular members shall be unable to
serve during the consideration and decision of any particular matter, the
Business Conduct Committee may request the Chairman of the Board to
appoint an alternate or alternates to sit throughout the investigation,
hearing, and decision of such matter. The Chairman of the Board shall have
the power to appoint any member or members as such alternate or
alternates. When so appointed such alternate or alternates shall, with
respect to such particular matter, have all the powers and duties of the
regular member or members for whom he is or they are acting, and the
"Committee on Particular Matter," consisting of such alternate or
alternates, and the remaining regular members of the Business Conduct
Committee, if any, shall with respect to such particular matter have all
the duties and powers of the regular Business Conduct Committee. During
such period as a Committee or Committees on a Particular Matter or Matters
are functioning, the regular Business Conduct Committee and the regular
members thereof shall continue to have all the powers and to perform all
the duties concerning matters not under consideration by a Committee or
Committees on Particular Matters.
(f) Duties of Committee. The Committee shall determine the manner and form in
which its proceedings shall be conducted. The Committee shall provide for
the prevention of manipulation of prices and the cornering of any
commodity on the Exchange, and shall also have general supervision of the
business conduct of members, member firms, any other persons with trading
privileges, wholly-owned affiliates, guaranteed introducing brokers, and
any employees or associated persons of any such individual or firm,
particularly insofar as such conduct affects (1) non-member customers; (2)
the public at large; (3) the State Government; (4) the Federal Government;
(5) public opinion; and (6) the good name of the Association. The
Committee shall also have general supervision, other than financial
supervision, over all agricultural regular firms and their employees,
member and non-member alike, with respect to each such firm's compliance
with the Association's Rules and Regulations pertaining to its regularity.
The Committee in performing its duties may investigate the dealings,
transactions and financial condition of members, member firms, any other
persons with trading privileges, wholly-owned affiliates, agricultural
regular firms, guaranteed introducing brokers, and any employees or
associated persons of any such individual or firm, and may examine their
books and papers upon request. The Committee may employ such auditors and
other assistants as it may deem necessary, and all expenses incident
thereto shall be payable from the funds of the Association.
The Committee shall have the authority to charge a member, member firm,
person with trading privileges, wholly-owned affiliate, agricultural
regular firm, guaranteed introducing broker, or any employee or associated
person of any such individual or firm alleged to have violated any Rule or
Regulation within its jurisdiction and may impose any one or more of the
following preliminary penalties: a reprimand, a cease and desist order, a
fine not to exceed $25,000 for each such violation, and/or restitution.
The Committee may also impose upon any such individual member, person with
trading privileges, or employee of a member or member firm a preliminary
denial of the privileges of the Floor of the Exchange or suspension from
membership status for a period not in excess of ninety (90) business days
for each such violation. Except in the case of specified penalties, which
shall be heard by the Committee in accordance with Regulations 540.02 and
540.03, proceedings shall be conducted by the Hearing Committee in
accordance with Regulations 540.02 and 540.03. The specified penalties
which shall be heard by the Committee shall be defined as a reprimand,
fines not exceeding $5,000.00 for any one violation, and a denial of the
privileges of the Floor for a period not exceeding five (5) business days
for any one violation. In the event there is a finding of multiple
violations of any Rules or Regulations it shall be within the relevant
Committee's discretion to apply its
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denial or suspension powers either in a consecutive or concurrent manner.
A party under a cease and desist order may apply to the Committee to review
and terminate such order, provided that such order has been in effect for at
least five years prior to application.
The decision of the Business Conduct Committee or the Hearing Committee may
be appealed to the Appellate Committee in accordance with Regulation 540.05
by filing with the Secretary of the Association, within ten (10) business
days after the decision is sent to the respondent, a Notice of Appeal to the
Appellate Committee requesting a review by the Appellate Committee of all or
part of the decision.
Any member, member firm, other person with trading privileges, wholly-owned
affiliate, agricultural regular firm, guaranteed introducing broker, or
employee or associated person of any such individual or firm who fails to
appear before the Committee pursuant to its request, or to submit his or its
books and records to the Committee at its request, shall be guilty of an
offense against the Association.
The Committee may review at any time the operations or procedures of
members, member firms, any other persons with trading privileges, wholly-
owned affiliates, agricultural regular firms, guaranteed introducing
brokers, and any employees or associated persons of any such individuals or
firms to assure compliance with the Rules and Regulations of the
Association. Whenever such review discloses a condition or practice which,
in the Committee's judgment, falls within the provisions of Regulation
270.01 or Regulation 540.06, it shall so advise the Chairman of the Board
and recommend such action as it deems appropriate in the circumstances.
(g) Offense Against the Association. It shall be an act detrimental to the
interest and welfare of the Association for any member of the Association,
member firm, other person with trading privileges, wholly-owned affiliate,
agricultural regular firm, guaranteed introducing broker, or employee or
associated person of any such individual or firm to fail to comply with the
disciplinary action of the Committee after such action becomes effective.
(h) Hold-Over Members. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding, and the term of one or more
of the members expires, such member or members may continue in office until
the proceeding has ended. A holdover member shall not participate in any
other Committee business, nor shall his continuation in office impair the
appointment of his successor or his successor's right to participate in all
other Committee business. (08/01/98)
543.00 Floor Governors Committee-
(a) Membership. The Chairman of the Board, with the approval of the Board,
shall appoint from the Membership of the Association the members of a Floor
Governors Committee who shall not be Directors or Officers of the
Association. The Committee shall consist of seven members. Each year the
Chairman of the Board, with the approval of the Board, shall appoint one
member of the Committee for a term of three years dating from February 1 of
such year. Each year, the Chairman of the Board, with the approval of the
Board shall also appoint from the Membership two members of the Committee
to serve for a one year term dating from February 1 of such year. In
addition, each year, beginning with 1985, the Chairman of the Board, with
the approval of the Board, shall also appoint from the Membership a member
of the Committee for a two year term dating from February 1 of such year. A
vacancy in the Committee shall be filled for the unexpired term by
appointment by the Chairman of the Board, with the approval of the Board.
(b) Chairman and Vice Chairman of the Committee. The Chairman of the Board,
with the approval of the Board, shall appoint a Chairman and a Vice
Chairman of the Committee from among the members of the Committee. The
Chairman and Vice Chairman shall be appointed to serve as Chairman and Vice
Chairman for a one-year term.
(c) Meetings and Quorum. The Floor Governors Committee shall determine the time
and place of its meetings and the manner and form in which its meetings
shall be conducted. The attendance of four Floor Governors shall constitute
a quorum of the Committee. The majority vote of the quorum of the Floor
Governors Committee shall be the official act or decision of the Committee.
(d) Duties of the Committee. It shall be the function and duty of the Floor
Governors Committee to assure
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that the practices and conduct of the members of the Association, member
firms, other persons with trading privileges, and employees of any such
individual or firm on the Floor of the Exchange are in compliance with the
Rules and Regulations. Whenever any violation of the Rules or Regulations
is suspected by the Committee, and the Committee determines, after
investigation by the Office of Investigations and Audits, that action
should be taken, the Committee shall provide notice and opportunity for a
hearing in compliance with Regulations 540.02 and 540.03. The Committee
shall have the authority to charge a member, member firm, person with
trading privileges, or any employee of any such individual or firm alleged
to have violated any Rule or Regulation within its jurisdiction and may
impose any one or more of the following preliminary penalties: a reprimand,
a cease and desist order, a fine not to exceed $25,000 for each such
violation, and/or restitution. The Committee may also impose upon any such
individual member, person with trading privileges, or employee of a member
or member firm a preliminary denial of the privileges of the Floor of the
Exchange or suspension from membership status for a period not in excess of
ninety (90) business days for each such violation. Except in the case of
specified penalties, which shall be heard by the Committee in accordance
with Regulations 540.02 and 540.03, proceedings shall be conducted by the
Hearing Committee in accordance with Regulations 540.02 and 540.03. The
specified penalties which shall be heard by the Committee shall be defined
as a reprimand, fines not exceeding $5,000 for any one violation, and a
denial of the privileges of the Floor for a period not exceeding five (5)
business days for any one violation. In the event there is a finding of
multiple violations of any Rules or Regulations, it shall be within the
relevant Committee's discretion to apply its denial or suspension powers
either in a consecutive or concurrent manner.
Also fines not to exceed $5,000 for any act may be imposed as specifically
authorized in Regulation 519.03.
A party under a cease and desist order may apply to the Committee to review
and terminate such order, provided that such order has been in effect for
at least five years prior to application.
(e) Appeal. A member, member firm, other person with trading privileges, or any
employee of any such individual or firm, may appeal from the decision of
the Floor Governors Committee or the Hearing Committee in accordance with
Regulation 540.05 by filing with the Secretary of the Association within
ten (10) business days after the decision is sent to the respondent a
Notice of Appeal to the Appellate Committee requesting a review by the
Appellate Committee of all or part of the decision.
(f) Offense Against The Association. It shall be an act detrimental to the
interest and welfare of the Association for any member of the Association,
member firm, other person with trading privileges, or employee of any such
individual or firm to fail to comply with the disciplinary action of the
Committee after such action becomes effective.
(g) Oath. Every Floor Governor shall take an oath not to divulge, or allow or
cause to be divulged, any information acquired by such member in his
official capacity as a Floor Governor if such information is confidential,
commercially sensitive, or non-public, except when required in connection
with his official duties, or in connection with disciplinary proceedings or
other formal proceedings or actions of a duly authorized committee of the
Association or of the Board, or in response to a duly authorized subpoena,
or in response to a request or demand by an administrative or legislative
body of government having jurisdiction of the subject matter and authority
to obtain the information requested, or on behalf of the Association in any
proceeding authorized by the Board of Directors.
(h) Hold-over Member. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding, and the term of one or more
of the members expires, such member or members may continue in office until
the proceeding has ended. A holdover member shall not participate in any
other Committee business, nor shall his continuation in office impair the
appointment of his successor or his successor's right to participate in all
other Committee business.
(i) Associate Members as Floor Governors. Associate Members of the Exchange are
eligible for appointment to the Floor Governors Committee as full voting
members, provided that Associate Members shall not be eligible to serve as
Chairman of the Committee. The Committee shall at all times have at least
two Associate Members on the Committee. (08/01/98)
543.01 Investigations - The President or the Executive Vice-President shall
have the authority to
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order investigations into any complaints made to the Association or into any
situation no matter how brought to their attention involving possible violations
of the Rules and Regulations of the Association. 1792 (08/01/94)
544.00 Waiver of Hearing - The statement of charges may provide that if the
respondent fails, except for good cause, to request a hearing within a specified
period of time, which in no event shall be less than five business days after
the service of the charges, he shall be deemed to have accepted a penalty stated
in the charges. (08/01/94)
545.00 Testimony And Production Of Books And Records - If a member of the
Association, member firm, or other person with trading privileges, is required
to submit his books and records, or the books and records of his firm, or
corporation, or any portion thereof, to the Board, or to any authorized Standing
or Special Committee, or to the individual responsible for the supervision of
the Office of Investigations and Audits as provided for in Regulation 170.01,
or, subject to the provisions of Rule 548.00, to furnish any information to or
to appear and testify before, or to cause any of his partners or employees to
appear and testify before such Board, or such authorized Committee, or at the
request of such individual responsible for the supervision of the Office of
Investigations and Audits, it shall be an offense against the Association to
fail or refuse to comply with such requirements. 153 (08/01/94)
545.01 Furnishing Information - Pursuant to Rule 545.00 and Regulations
545.02 and 545.03, each clearing member shall furnish to the Board or to any
committee or department specified by the Board, such information respecting
daily trading, deliveries, exchanges of futures for cash commodities or other
activity as the Board deems necessary for compliance by the Association with the
provisions of Regulations Sections 16.00 through 16.03 under the Commodity
Exchange Act or as required to be made or maintained under the Rules and
Regulations. Such data shall be furnished at such times and in such manner and
form as the Board or the committee or department acting for the Board may
prescribe.
The Business Conduct Committee, the Financial Compliance Committee, or the Floor
Governors Committee may, without hearing, impose minor penalties against members
or member firms for failure by such members or member firms, or for failure by
any persons for whom such members or member firms are responsible, to submit
requested routine trade documentation within the respective Committees'
jurisdiction in the manner prescribed by the Committee. Minor penalties for the
purpose of this Regulation shall be defined as fines not exceeding $1,000 for
any one offense.
If the documents requested are one year old or less, they must be produced and
submitted to the Office of Investigations and Audits within five (5) business
days. If the documents requested are more than one year old and less than five
years old, they must be produced and submitted to the Office of Investigations
and Audits within ten (10) business days. The Business Conduct Committee, the
Financial Compliance Committee, or the Floor Governors Committee may impose a
fine of up to $1,000 for each business day thereafter on which the member,
member firm or any person for whom such member or member firm is responsible,
has not produced and submitted the requested documents to the Office of
Investigations and Audits.
A respondent may request an appeal of a minor penalty by filing a written
request for a hearing with the Office of Investigations and Audits within ten
(10) business days after the penalty is imposed; the Business Conduct Committee,
the Financial Compliance Committee, or the Floor Governors Committee shall hear
the matter in accordance with Regulations 540.02 through 540.05. The decision of
the Business Conduct Committtee, the Financial Compliance Committee, or the
Floor Governors Committee may be appealed to the Appellate Committee as provided
in Rule 542.00(f) or 543.00(e). Failure to request a hearing shall be deemed a
consent to the fine. Unless a hearing is requested, failure to pay a fine
within thirty (30) days after the penalty is imposed shall automatically triple
the amount of the fine. 1973 (08/01/94)
545.02 Record Keeping - Pursuant to Rule 545.00 and Regulation 545.03, each
member and member firm shall keep in an accurate and complete manner all books
and records required to be made or maintained under the Rules and Regulations.
All books and records required to be kept shall be kept for a period of five (5)
years from the date thereof and shall be readily accessible for a period of two
(2)
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years from the date thereof. All reports required to be submitted to the
Association or its delegate shall be reported accurately and completely.
(08/01/94)
545.03 Record Keeping Qualifications - Each member, member firm and other
person with membership privileges shall be required, pursuant to the rules and
regulations, to keep, maintain and furnish only those books and records that
relate directly to the trading of futures and options contracts, satisfaction
of the minimum financial requirements for futures commission merchants and
qualifications for membership. (08/01/94)
545.04 Equity Runs Transmission Requirement - Each member shall be required to
have the ability to electronically transmit the complete bookkeeping reports to
its Chicago office or to the Board of Trade Clearing Corporation by 8:00 a.m.
central time on the day following the report date. The reports must, at a
minimum, include the margin equity run, master file of customer account names
and addresses, open position listing, day trade listing, cash adjustment sheets,
margin call and debit/deficit report. (08/01/94)
545.05 Maintenance of Telephone Recordings - Members and member firms which
record conversations conducted on their Exchange Floor telephone lines shall
maintain the resultant recordings for a period of 10 business days following the
day when such recordings are made. In addition, all recordings of Exchange
Floor headset communications shall be maintained for a period of 10 business
days following the day when such recordings are made. (07/01/98)
546.00 Testimony Before Other Exchanges - If the Board shall deem it is to the
interest and welfare of the Association, or to the public interest, or in the
interest of just and equitable principles of trade, to facilitate the
examination by the authorities of another exchange of any transaction in which a
member of the Association has been concerned and that the testimony of such
member, his partners, or employees, or his books and papers, or the books and
papers of his firm, or corporation, or any partner therein are material to such
examination, and shall direct such member to appear and testify, or to cause any
of his partners or employees to appear and testify, or to produce such books and
papers before the authorities of said other exchange, or any committee thereof,
for the purposes of such examination, and the member of the Association shall
refuse or fail to comply with such direction, he may be adjudged guilty of an
act detrimental to the interest or welfare of the Association. 154 (08/01/94)
548.00 Incriminating Evidence - Upon any investigation or trial before the
Board, or before any committee, or before any other tribunal of the Association,
no member or agricultural regular firm shall be required to answer, or be
subject to any penalty for failing to answer any question, when such member or
agricultural regular firm shall make oath that the answer, if given, would
convict or tend to convict such member or agricultural regular firm of the
violation of any law of the United States or any state. 161 (08/01/94)
549.00 Depositions of Witnesses - Upon any investigation authorized under the
Rules and Regulations of the Association, the oral depositions of witnesses may
be taken. The party under investigation shall be given at least five (5) days
written notice of the time of the deposition and place where the witness will be
deposed, which may be at any location within the United States. The party under
investigation shall have the right to be present in person or by representative
at the oral deposition, with right of cross-examination. All oral depositions
of witnesses shall be taken under oath, before an officer qualified in the place
of the deposition to administer oaths, and the complete testimony of the
witnesses shall be transcribed by such officer or by a person under his
supervision. Oral depositions taken in accordance with this provision shall be
admissible in evidence at any hearing of the board or a Committee, reserving to
the party under investigation the right to object at the hearing to the
relevancy or materiality of the testimony contained therein. 162 (08/01/94)
550.00 Rehearing - A suspended or expelled member or member firm, and any
member or member firm that has been fined, may petition the Appellate Committee
for a rehearing. Upon presentation of the petition, the Appellate Committee, by
a majority vote, may order a rehearing to determine whether the disciplinary
action was the result of false testimony or was otherwise unjust or improper.
The rehearing will be conducted in accordance with Regulations 540.02 and
540.03.
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If, after a rehearing the Appellate Committee unanimously finds that such member
or member firm was mistakenly expelled, suspended, or fined, or that the penalty
imposed was excessive, the prior disciplinary action against such member or
member firm may be set aside or the penalty mitigated. No prior disciplinary
action or penalty shall be set aside or mitigated if any member of the Appellate
Committee votes against such action.
The petition of a member or member firm who has been suspended, expelled, or
fined, for a rehearing shall be posted upon the bulletin board of the Exchange
for at least one week prior to its presentation to the Appellate Committee.
A member or member firm whose prior expulsion, suspension, and/or fine is set
aside or mitigated in accordance with this Rule shall have no claim in law or
equity against the Association or any Director, committee member, officer or
employee thereof by virtue of such prior action thus set aside or mitigated.
A rehearing is not a right. An action of the Appellate Committee is final when
rendered as provided in Regulation 540.07, but may be reviewed by the Board
pursuant to Regulation 540.05. Every suspension, expulsion, or fine will be
considered final until set aside or reduced under this Rule. 157 (08/01/94)
551.00 Financial Compliance Committee-
(a) Membership. The Chairman of the Board, with the approval of the Board, shall
appoint the members of the Financial Compliance Committee. The Committee
shall consist of five Full Members at least three of whom shall be an
officer or partner of a member firm and who shall not be Directors or
Officers of the Association. Initially, two members of the Committee shall
serve for a term of two years. At the time this Rule becomes effective,
three members shall be appointed to serve a term expiring February 1, 1992.
Each year thereafter, beginning in 1992, the Chairman of the Board, with the
approval of the Board, shall appoint two members of the Committee to serve a
term of two years and one member to serve a term of one year. A vacancy in
the Committee shall be filled for the unexpired term in the same manner as
provided above, except that unexpired one-year terms may be left vacant at
the discretion of the Chairman of the Board. The President and Chief
Executive Officer of the Board of Trade Clearing Corporation shall be a non-
voting advisor to the Committee.
(b) Chairman and Vice-Chairman of the Committee. The Chairman of the Board, with
the approval of the Board, shall appoint a Chairman and a Vice-Chairman of
the Committee from among the members of the Committee. The Chairman and
Vice-Chairman shall be appointed to serve as Chairman and Vice-Chairman for
a one-year term.
(c) Oath of Members. Every member of the Committee shall take an oath not to
divulge, or allow or cause to be divulged, any information acquired by such
member in his official capacity if such information is confidential,
commercially sensitive or non-public, including any information regarding
the market position, financial condition, or identity of any trader or firm,
except when required in connection with his official duties, or in
connection with disciplinary proceedings or other formal proceedings or
actions of a duly authorized committee of the Association, or of the Board,
or in response to a duly authorized subpoena, or in response to a request or
demand by an administrative or legislative body of government having
jurisdiction of the subject matter and authority to obtain the information
requested, or on behalf of the Association in any proceeding authorized by
the Board.
(d) Quorum. The attendance of three (3) members at a meeting shall constitute a
quorum. The actions of a majority of the members present shall be the
actions of the Committee.
(e) Financial Compliance Committee on Particular Matter. If the Financial
Compliance Committee shall determine that it is improper for any or all of
its regular members to serve during the consideration and decision of any
particular matter, or if any or all the regular members shall be unable to
serve during the consideration and decision of any particular matter, the
Financial Compliance Committee may request the Chairman of the Board to
appoint an alternate or alternates to sit throughout the investigation,
hearing, and decision of such matter. The Chairman of the Board shall have
the power to appoint, consistent with paragraph (a) above, any member or
members as such alternate or alternates.
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When so appointed, such alternate or alternates shall, with respect to such
particular matter, have all the powers and duties of the regular member or
members for whom he is or they are acting, and the "Committee on Particular
Matter," consisting of such alternate or alternates, and the remaining
regular members of the Financial Compliance Committee, if any, shall with
respect to such particular matter have all the duties and powers of the
regular Financial Compliance Committee. During such period as a Committee or
Committees on a Particular Matter or Matters are functioning, the regular
Financial Compliance Committee and the regular members thereof shall
continue to have all the powers and to perform all the duties concerning
matters not under consideration by a Committee or Committees on Particular
Matters.
(f) Duties and Authority of the Committee. The duty of the Committee is to
monitor and ensure the capital and financial integrity of members and member
firms. The Committee may determine, in its sole discretion, that there is
reason to believe that the financial status of a member or member firm
represents a condition inconsistent with sound business practices and
financial integrity, and may exercise the following authority, without
limitation, over the financial organization of members and member firms.
The Committee shall determine the manner and form in which its proceedings
shall be conducted. The Committee shall have authority, without limitation,
over the financial organization of member firms and the financial inter-
relationships between member firms and their wholly-owned affiliated
entities, including parents and subsidiaries. The Committee shall also have
the authority, without limitation, to supervise the nature of capital
formation and the capital compliance of members, member firms, wholly-owned
affiliates, any other persons with trading privileges, guaranteed
introducing brokers, and any employees or associated persons of any such
individual or firm, particularly insofar as such conduct may have an adverse
impact on the member's, member firm's or wholly-owned affiliate's capital or
financial stability. The Committee shall also have the authority, without
limitation, to supervise the financial organization, nature of capital
formation and the capital compliance of all agricultural regular firms and
their employees, member and non-member alike.
The Committee in performing its duties may investigate the dealings,
transactions and financial interrelationships and condition of members,
member firms, wholly-owned affiliates, agricultural regular firms, any other
persons with trading privileges, guaranteed introducing brokers, and any
employees or associated persons of any such individual or firm, may examine
their books and papers upon request, and, with respect to member firms, may
prescribe such capital requirements as it deems appropriate, including,
without limitation, requiring the immediate or expeditious infusion of
additional capital (subject to the procedures contained herein). Upon
approval by the Chairman of the Board, the Committee may employ such
experts, auditors, counsel and other assistants as it may deem necessary on
a case-by-case basis, and all expenses incident thereto shall be payable
from the funds of the Association.
(1) Where immediate action is necessary, the Committee shall have the
authority prior to a hearing, only upon written approval by the Chairman
of the Board, to take summary action consistent with this rule subject
to a subsequent hearing to be held within five (5) days from the date of
the summary action in accordance with Regulation 540.06. This hearing,
conducted before the Committee or Board, shall follow the requirements
of Regulation 540.03(c)-(j).
The member, member firm, person with trading privileges, wholly-owned
affiliate, agricultural regular firm, guaranteed introducing broker, or
employee or associated person of any such individual or firm will be
immediately notified in writing of the Committee's or Board's decision,
in the form of an order signed by the Chairman of the Committee and the
Chairman of the Board of Directors. Upon written notification of the
decision, the respondent may request a hearing to be held within five
(5) days. After this hearing, the respondent may appeal the decision to
the Board of Directors. The Board of Directors may modify the conditions
of the original order.
Alternatively, any such summary order may be appealed directly to the
Board of Directors within one business day. The member, member firm,
person with trading privileges, wholly-owned affiliate, agricultural
regular firm, guaranteed introducing broker, or employee or associated
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person of any such individual or firm subject to such order must give
written notice of appeal to the Secretary immediately upon receipt of
the Committee's order; the Board shall hear the appeal within one
business day following receipt of said appeal notice or such later date
as the Board may establish pursuant to the written waiver of the one
business day hearing requirement by the member, member firm, person with
trading privileges, wholly-owned affiliate, agricultural regular firm,
guaranteed introducing broker, or employee or associated person of any
such individual or firm.
(2) The Committee shall have the authority to charge a member, member firm,
wholly-owned affiliate, agricultural regular firm, person with trading
privileges, guaranteed introducing broker, or any employee or associated
person of any such individual or firm alleged to have violated any Rule
or Regulation or written policy within its jurisdiction and may impose
any one or more of the following preliminary penalties: a reprimand, a
cease and desist order, a fine not to exceed $25,000 for each such
violation, and/or restitution. The Committee may also impose upon any
such individual member, person with trading privileges, or employee of a
member or member firm a preliminary denial of the privileges of the
Floor of the Exchange or suspension from membership status for a period
not in excess of ninety (90) business days for each such violation.
Except in the case of specified penalties, which shall be heard by the
Committee in accordance with Regulations 540.02 and 540.03, proceedings
shall be conducted by the Hearing Committee in accordance with
Regulations 540.02 and 540.03. The specified penalties which shall be
heard by the Committee shall be defined as a reprimand, fines not
exceeding $5,000.00 for any one violation, and a denial of the
privileges of the Floor for a period not exceeding five (5) business
days for any one violation. In the event there is a finding of multiple
violations of any Rules or Regulations it shall be within the relevant
Committee's discretion to apply its denial or suspension powers either
in a consecutive or concurrent manner.
A party under cease and desist order may apply to the Committee to
review and terminate such order, provided that such order has been in
effect for at least five years prior to application.
The decision of the Financial Compliance Committee or the Hearing
Committee may be appealed to the Appellate Committee in accordance with
Regulation 540.05 by filing with the Secretary of the Association,
within ten (10) business days after the decision is sent to the
respondent, a Notice of Appeal to the Appellate Committee requesting a
review by the Appellate Committee of all or part of the decision.
(3) Any member, member firm, wholly-owned affiliate, agricultural regular
firm, other person with trading privileges, guaranteed introducing
broker, or employee or associated person of any such individual or firm
who fails to appear before the Committee pursuant to its request, or to
submit his or its books and records to the Committee at its request,
shall be guilty of an offense against the Association.
The Committee may review at any time the operations or procedures of
members, member firms, wholly-owned affiliates, agricultural regular
firms, any other persons with trading privileges, guaranteed introducing
brokers, and any employees or associated persons of any such individuals
or firms to assure compliance with the Rules and Regulations of the
Association. Whenever such review discloses a condition or practice
which, in the Committee's judgment, falls within the provisions of
Regulation 270.01 or Regulation 540.06, it shall so advise the Chairman
of the Board and recommend such action as it deems appropriate in the
circumstances.
(g) Offense Against the Association. It shall be an act detrimental to the
interest and welfare of the Association for any member of the Association,
member firm, wholly-owned affiliate, agricultural regular firm, other person
with trading privileges, guaranteed introducing broker, or employee or
associated person of any such individual or firm to fail to comply with the
disciplinary action of the Committee after such action becomes effective.
(h) Hold-Over Members. Whenever the Committee members have begun to hear or
review evidence and argument in any proceeding, and the term of one or more
of the members expires, such member or
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---------------
members may continue in office until the proceeding has ended. A hold-over
member shall not participate in any other Committee business, nor shall his
continuation in office impair the appointment of his successor or his
successor's right to participate in all other Committee business. (08/01/98)
Ch5 Proceedings
560.00 Expulsion and Suspension from Membership - Unless otherwise
specifically provided, the penalty of suspension from membership may be
inflicted, and the period of suspension determined, by the vote of a majority of
the members of the Appellate Committee or the Board present, and the penalty of
expulsion from membership or of ineligibility of a suspended member for
reinstatement may be inflicted only by a vote of two-thirds of the members of
the Board present.
At any disciplinary hearing the Appellate Committee or the Board may impose a
fine upon any member or member firm for each Rule or Regulation violated. By
majority vote of the Appellate Committee members or Directors present, the fine
for each Rule or Regulation violated shall not exceed $250,000. The time for
payment of any such fine shall be determined by the Appellate Committee or the
Board. Failure of any member or member firm to pay the fine during the
prescribed period shall be considered an act detrimental to the interest and
welfare of the Association. 140 (08/01/94)
560.01 Disciplinary Notice - Any member who is suspended, expelled, denied
access to the Floor of the Exchange or otherwise disciplined shall be notified
of such action in writing, with notification to the Commodity Futures Trading
Commission in a manner permitted by the Commission, within thirty (30) days.
The notification shall include the reasons for the Exchange action in the form
and manner the Commission prescribes. 1795 (01/01/00)
560.02 Association Bar - Unless otherwise specifically provided, the penalty
of a bar from association with any member or member firm may be imposed, and the
period of an association bar determined, by the vote of a majority of the
members of the Appellate Committee or the Board present. A permanent bar from
association may be imposed only by the Board by a vote of two-thirds of the
members of the Board present. For purposes of this regulation, a bar from
association with any member or member firm includes, but is not limited to, a
member's acting in the capacity of a partner, officer, director, employee and/or
agent of a member or member firm. (08/01/94)
561.00 Suspended or Expelled Member Deprived of Privileges - When a member is
suspended by a Committee of the Association or the Board, such member shall be
deprived during the term of his suspension of all rights and privileges of
membership, but he may be proceeded against by the Board for an offense other
than that for which he was suspended.
The expulsion of a member terminates all rights and privileges arising out of
his membership, except such rights in respect to the proceeds of the transfer
thereof as he may have under the provisions of Chapter 2 hereof. 159
(08/01/94)
562.00 Discipline During Suspension - A member suspended under the provisions
of this Chapter may be proceeded against by the Board for any offense committed
by him either before or after the announcement of his suspension, in all
respects as if he were not under suspension. (08/01/94)
563.00 Trade Checking Penalties - The Floor Conduct Committee may assess a
penalty not to exceed $1,000.00 for each day that a member or registered
eligible business organization fails to make adequate provisions for the
checking of trades that have been rejected by the Clearing House. Such penalty
may be appealed to the Appellate Committee on the ground that it is excessive or
unreasonable, and the Appellate Committee may thereupon revoke, modify, or
impose a greater or different penalty. (04/01/98)
[Download Table]
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Chapter 6
Arbitration of Member Controversies
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600.00 Arbitration of Member Controversies.........................
600.01 Member to Member Statute of Limitations.....................
601.00 Arbitration of Customers' Claims and Grievances.............
601.01 Award of Actual Damages.....................................
601.02 Award of Punitive or Exemplary Damages......................
602.00 Arbitration of Other Member-Nonmember Controversies.........
Ch6 A. Definitions.........................................................
603.00 Member Defined..............................................
603.01 Definitions.................................................
Ch6 B. Organization........................................................
610.01 Arbitration Committee.......................................
610.02 Administrator of Arbitration................................
610.03 Unassociated Persons........................................
Ch6 C. Jurisdiction, Submission, Selection of Arbitrators..................
620.01 Jurisdiction and Submission.................................
620.02 Selection of Arbitrators and Chairman.......................
620.03 Special Arbitrators.........................................
620.04 Time Limit for Filing Customers' Claims and Grievances......
620.05 Time Limit for Filing Claims in Member/Agricultural Regular
Firm Controversies..........................................
Ch6 D. Procedure...........................................................
630.01 Pleadings...................................................
630.02 Third Party Actions.........................................
630.03 Cross Claims................................................
630.04 Representation by Attorney..................................
630.05 Time and Place for Hearing..................................
630.06 Witnesses, Subpoenas, Depositions...........................
630.07 Oath of Arbitrators.........................................
630.08 Hearing Procedures..........................................
630.09 Amendments To Pleadings.....................................
630.10 Adjournments................................................
630.11 Notice and Communications...................................
630.12 Arbitration Procedures For Claims Under $2,500..............
630.13 Rulings and Awards..........................................
630.14 Change of Award.............................................
Ch6 E. Miscellaneous Provisions............................................
640.01 Fees and Expenses...........................................
640.02 Ex Parte Contacts...........................................
640.03 Holdover Arbitrators........................................
640.04 Power to Decline Jurisdiction...............................
640.05 Compliance With Applicable Laws.............................
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Chapter 6
Arbitration of Member Controversies
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600.00 Arbitration of Member Controversies - Any controversy between parties
who were members at the time such controversy arose and which arises out of the
Exchange business of such parties shall, at the request of any such party, be
submitted to arbitration in accordance with regulations prescribed by the
Exchange. Every member, by becoming such, agrees to arbitrate all such disputes
with other members in accordance with this Rule and the regulations prescribed
by the Exchange pursuant to this Rule, and further agrees and obligates himself
to abide by and perform any awards made thereunder. (06/01/95)
600.01 Member to Member Statute of Limitations - A controversy shall be
submitted to arbitration within two years from the date the member knew or
should have known of the dispute. (09/01/95)
601.00 Arbitration of Customers' Claims and Grievances - The Exchange shall by
regulation establish procedures in conformity with Section 5a(11) of the
Commodity Exchange Act and Regulations thereunder for the settlement through
arbitration of customers' claims and grievances against members and their
employees. Every member, by becoming such, agrees to abide by all regulations
prescribed by the Exchange pursuant to this Rule, and further agrees to abide by
and perform any awards made thereunder. (08/01/94)
601.01 Award of Actual Damages - If an award of actual damages is made against
a floor broker in connection with the execution of a customer order, the futures
commission merchant that selected the floor broker may be required to satisfy
such award. (08/01/94)
601.02 Award of Punitive or Exemplary Damages - Punitive or exemplary damages
may be awarded to a customer in addition to losses proximately caused by a floor
broker, if the floor broker acted wilfully and intentionally in bringing about
the customer's losses. The punitive or exemplary damages may not exceed an
amount equal to two times the amount of the actual damages proximately caused by
the floor broker. In addition, the futures commission merchant that selected the
floor broker may be required to satisfy the award of punitive or exemplary
damages if the floor broker fails to do so and only if the futures commission
merchant wilfully and intentionally selected the floor broker with the intent to
assist or facilities the floor broker's violation. (08/01/94)
602.00 Arbitration of Other Member-Nonmember Controversies - - The Exchange may
by regulation establish procedures for the voluntary arbitration of
controversies between members and nonmembers arising out of Exchange business,
other than customers' claims and grievances, where neither the claim, nor any
counterclaim, is in excess of $50,000. Every member, by becoming such, agrees to
abide by all regulations which the Exchange may prescribe pursuant to this Rule,
and further agrees to abide by and perform any awards made thereunder.
(08/01/94)
Ch6 A. Definitions
603.00 Member Defined - For purposes of this Chapter, the term "member"
includes all individual members of the Association, and all partnerships,
corporations, and cooperative associations registered with the Association
pursuant to Rule 230.00 or related regulations. (11/01/94)
603.01 Definitions -
For purposes of this Chapter:
A. "Member" of the Association includes all individual members of the
Association, and all partnerships, corporations, and cooperative
associations that are registered with the Association pursuant to Rule
230.00 or Regulation 230.17. For purposes of Rule 600.00 and Regulation
620.01(A), "member" shall also be deemed to include the operator or manager
of a warehouse or shipping plant that has been declared regular by the
Exchange for the delivery of grains, soybean oil or soybean meal in Board of
Trade contracts.
B. "Claims or grievance" is any dispute which arises out of any transaction on
or subject to the rules of the Exchange (including any transaction on or
subject to the Rules of another contract market if such transaction is part
of the same cause of action), executed by or effected through a member of
the Association, or by or through an employee of a member of the
Association, which dispute does not require for adjudication the presence of
essential witnesses or third parties over whom the Association does not have
jurisdiction and who are not otherwise available. A "claim or grievance"
does not include disputes arising from cash market transactions which are
not part of or directly connected with any transaction for the purchase or
sale of any commodity for future delivery.
C. "Customer" does not include any member of the Association.
D. "Unassociated person" excludes all persons who are either members of or
associated with members of the Association, who are employees of the
Association, or who are otherwise associated with the Association. For the
purpose of customer claims or grievances in connection with this chapter
only, "unassociated person" excludes all persons who are members of, or
associated with members of, or are employees of, or otherwise associated
with, the Association or any other contract market. (08/01/94)
Ch6 B. Organization
610.01 Arbitration Committee - The Arbitration Committee shall consist of
twenty-eight (28) individual members of the Association appointed by the
Chairman of the Board with the approval of the Board. Seven (7) shall be chosen
from each of the following four (4) categories: seven (7) shall be principally
engaged as floor traders; seven (7) shall be principally engaged as floor
brokers; seven (7) shall be affiliated with brokerage firms; and seven (7) shall
be affiliated with commercial firms. Fourteen (14) members shall be appointed
for a term to end January, 1992, and fourteen (14) members shall be appointed
for a term to end January, 1993. Beginning January, 1992, fourteen (14) members
shall be appointed each year for a term of two years. A vacancy shall be filled
for the unexpired term in the same manner as is provided above. No person shall
be a member of the Committee who, at the same time, is a member of the Board or
a member of any standing disciplinary committee. A member of the Arbitration
Committee shall not be disqualified to serve on the Committee or any panel
thereof due to a change in categories subsequent to his appointment. If the
category of a member of the Arbitration Committee should change subsequent to
his appointment, he shall be considered for all purposes to be in the category
from which he was chosen on the date of his appointment. (08/01/94)
610.02 Administrator of Arbitration - The Administrator of Arbitration
("Administrator") shall be appointed by the President to serve at his will. The
Administrator shall assist the Arbitration Committee in the performance of its
work, and perform all ministerial duties in connection therewith including the
following: he shall receive and file all submissions, pleadings and awards; he
shall select unassociated persons to serve on Mixed Panels; he shall schedule
and give notice of all hearings, keep a record of all cases, and keep such other
books, and memoranda as the Committee shall from time to time direct; he shall
receive and disburse all deposits and costs and keep careful and accurate
account thereof under the supervision of the Arbitration Committee; and he shall
perform all other duties incident to his office. (08/01/94)
610.03 Unassociated Persons - The Administrator shall maintain a list of
unassociated persons available to serve as arbitrators on Mixed Panels
constituted pursuant to Regulation 620.02 for the arbitration of customers'
claims and grievances and other member-nonmember controversies. The
Administrator shall from time to time select unassociated persons and place on
the list the names of such unassociated persons who are willing to serve as
arbitrators. (08/01/94)
Ch6 C. Jurisdiction, Submission, Selection of Arbitrators
620.01 Jurisdiction and Submission -
A. Member Controversies. The Arbitration Committee has jurisdiction to
arbitrate all controversies between members arising out of Exchange
business. A member party may compel another member party to arbitrate such
controversies by delivering to the Administrator a Statement of Claim.
B. *Customer's Claims and Grievances. The Arbitration Committee and Mixed
Panels constituted pursuant to Regulation 620.02 have jurisdiction to
arbitrate all customer's claims and grievances against any member or
employee thereof which have arisen prior to the date the customer's claim is
asserted. If the customer elects to initiate an arbitration proceeding of
any customer claim or grievance, the member shall submit to arbitration in
accordance with these Arbitration Rules and Regulations. The arbitration
shall be initiated by delivery to the Administrator of (a) a Statement of
Claim and a "Chicago Board of Trade Arbitration Submission Agreement for
Customers' Claims and Grievances" signed by the customer or (b) a Statement
of Claim and another arbitration agreement between the parties, which
agreement conforms in all respects with any applicable requirements
prescribed by the Commodity Futures Trading Commission. The refusal of any
member or employee to sign the ''Chicago Board of Trade Arbitration
Submission Agreement for Customer's Claims and Grievances" shall not deprive
the Arbitration Committee or a mixed Panel constituted pursuant to
Regulation 620.02 of jurisdiction to arbitrate customers' claims under these
Arbitration Rules and Regulations. The Committee and Mixed Panels have
jurisdiction to arbitrate a counterclaim asserted in such an arbitration,
but only if it arises out of the transaction or occurrence that is the
subject of the customers' claim or grievance and does not require for
adjudication the presence of essential witnesses, parties or third persons
over whom the Association does not have jurisdiction. Other counterclaims
are subject to arbitration by the Committee, or a Mixed Panel, only if the
customer agrees to the submission after the counterclaim has arisen.
C. Other Member-Nonmember Controversies. The Arbitration Committee, and Mixed
Panels constituted pursuant to Regulation 620.02, have jurisdiction to
arbitrate all controversies between members and nonmembers arising out of
Exchange business, other than customers' claims and grievances, where
neither the claim nor the counterclaim is in excess of $50,000 and where the
claim is filed no more than one year after the date of the transaction
giving rise to the claim or controversy. Any party may request the
arbitration of such controversy by delivering to the Administrator (1) a
Statement of Claim and a ''Chicago Board of Trade Arbitration Submission
Agreement" signed by all the parties or (2) a Statement of Claim and another
arbitration agreement between the parties, which agreement conforms in all
respects with any applicable requirements prescribed by the Commodity
Futures Trading Commission.
*The following is the text of Regulation 620.01(B) as amended by CFTC Rule
7.201. The legality of Rule 7.201, and thus the obligation of Board of Trade
members to arbitrate customer's claims and grievances, has been the subject of
litigation between the Board of Trade and one of its member firms against the
CFTC since 1982. On December 30, 1986, the United States District Court for the
Northern District of Illinois declared CFTC Rule 7.201 to be invalid as an
unconstitutional denial of a member firm's Seventh Amendment right to a jury
trial. However, on December 22,1987, the Seventh Circuit Court of Appeals
overturned the District Court's decision, thereby upholding CFTC Rule 7.201. The
Board of Trade, with a member firm, filed with the United States Supreme Court a
petition to review the Seventh Circuit's decision. On October 3,1988, the
Supreme Court denied the petition. The Supreme Court's ruling, in effect,
reaffirms the Seventh Circuit's decision validating CFTC Rule 7.201 and
compelling Association members, at the option of the customer, to arbitrate
customer disputes arising out of Exchange business. (08/01/94)
620.02 Selection of Arbitrators and Chairman
A. Customers' Claims and Grievances. Prior to the time of a customer's
submission of a claim or grievance to the arbitration procedure established
herein, he shall be informed that he may elect at the time of submission of
the claim or grievance to have his dispute heard by an arbitration panel
consisting of members selected pursuant to Subsection C of this Regulation,
or by a Mixed
Ch6 C. Jurisdiction, Submission, Selection of Arbitrators
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Panel selected pursuant to this Subsection. The customer shall be advised,
prior to election of a Mixed Panel
1. that any increased expenses attendant to having such a Mixed Panel shall
be borne by the member(s) regardless of the outcome of the arbitration
unless the arbitrators determine that the customer acted in bad faith in
initiating, or participating in, the arbitration proceeding.
2. that the Mixed Panel may have more or less knowledge in the area of
commodities relevant to his claim that a panel composed entirely of
members of the Arbitration Committee.
Such Mixed Panel shall be composed of five (5) persons, three of whom shall
be unassociated persons, and two of whom shall be members of the Arbitration
Committee, both of whom may be from the same category. The unassociated
persons on such Mixed Panel shall be chosen by the Administrator by lot from
the list of available unassociated persons maintained by the Administrator.
The members of the Arbitration Committee shall be selected in a manner to be
established by the Committee. Each panel shall be chaired by a member of the
Executive Subcommittee of the Arbitration Committee.
B. Other Member-Nonmember Controversies. The provisions of Subsection A of the
Regulation shall be applicable to the arbitration of member-nonmember
controversies, as well as to the arbitration of customers' claims and
grievances.
C. Other Controversies. In the case of controversies between members, or in the
event that a customer or nonmember party does not elect a Mixed Panel as
outlined in Subsections A and B of this Regulation, the arbitration panel
shall consist of five (5) Arbitrators, to be selected from the Arbitration
Committee in a manner to be established by the Committee, with at least one
Arbitrator to be selected from each category described in Regulation 610.01.
Each panel shall be chaired by a member of the Executive Subcommittee of the
Arbitration Committee.
D. Executive Subcommittee of the Arbitration Committee. For the purpose of this
Regulation 620.02, the Executive Subcommittee of the Arbitration Committee
shall consist of one Chairman, one Vice Chairman and three other members,
all of whom have been appointed by the Chairman of the Board with the
approval of the Board of Directors. One member of the Subcommittee must be
principally engaged as a floor trader, one member must be principally
engaged as a floor broker, one member must be affiliated with a brokerage
firm, and one member must be affiliated with a commercial firm. The Chairman
of the Subcommittee may come from any of the four categories cited in the
preceding sentence. (11/01/97)
620.03 Special Arbitrators - Where the controversy is of a highly technical
nature, if the parties desire, they may arrange between themselves for one or
more Special Arbitrators to be convened by the Administrator, in which event
such Special Arbitrator or Special Arbitrators shall proceed in accordance with
the provisions of this Chapter. (08/01/94)
620.04 Time Limit for Filing Customers' Claims and Grievances - The Arbitration
Committee and Mixed Panels constituted pursuant to Regulation 620.02 do not have
jurisdiction to arbitrate customers' claims and grievance which are filed more
than one year after the date of the transaction giving rise to the claim or
controversy. (08/01/94)
620.05 Time Limit for Filing Claims in Member/Agricultural Regular Firm
Controversies - The Arbitration Committee does not have jurisdiction to
arbitrate controversies between members and agricultural regular firms which are
filed more than one year after the date of the events giving rise to the claim
or controversy. (08/01/94)
Ch6 D. Procedure
630.01 Pleadings
A. Form of Pleadings. Pleadings shall be sufficient if they contain information
which reasonably informs the other party of the nature of the claim,
counterclaim, or defense. The amount of the claim or counterclaim shall be
stated where possible. Provided, however, in any controversy submitted
between non-members (parties who are neither customers nor members) and
members or their employees, the parties shall be deemed to have agreed
between themselves that no award upon a claim or counterclaim shall exceed
$50,000.
B. Notice. The Administrator shall deliver or mail copies of all pleadings to
the parties as soon as practicable.
C. Answer and Counterclaim. The respondent shall have ten (10) business days
from receipt of the Statement of Claim in which to file an answer and
counterclaim, if any, with the Administrator. If the respondent does not
file an answer and counterclaim, if any, within the time prescribed, the
respondent will be deemed to have denied the claim and to have waived any
counterclaim. The Administrator, in his discretion, may extend the filing
period upon request of the respondent.
D. Reply. The claimant shall be given the same opportunity to reply to any
counterclaim as was given the respondent to answer. (08/01/94)
630.02 Third Party Actions - In an arbitration between members pursuant to the
provisions of Regulation 620.01(A).
1. A party may bring in a third party member against whom a claim is asserted
arising out of or in connection with transactions referred to in the
pleadings.
2. A member may, in the discretion of the Arbitrators, intervene in a pending
arbitration proceeding and become a party if the Arbitrators are satisfied
that the claim which he asserts against either or both of the parties arises
out of or in connection with the transactions referred to in the pleadings.
3. The procedures to be followed in any third party action shall be determined
by the Arbitrators. (08/01/94)
630.03 Cross Claims - In an arbitration between members pursuant to the
provisions of Regulation 620.01(A), parties shall have the right to assert cross
claims. (08/01/94)
630.04 Representation by Attorney - A party is not required to be represented
by an attorney; however, he has the right to be represented by an
attorney at his own expense if he so chooses. A party who is represented by an
attorney shall so notify the Administrator and shall furnish to him the
attorney's name and address. Subsequent papers in the proceeding may be
delivered or mailed to the party through his attorney. The arbitrators may award
a party all or any portion of the party's reasonable attorneys fees and expenses
incurred as a result of another party's frivolous claim or defense. The party so
awarded shall submit an affidavit, detailing his attorney fees and expenses, to
the Administrator with notice to the opposing party. (08/01/96)
630.05 Time and Place for Hearing - The Administrator shall set a date for the
hearing after all pleadings have been filed, and shall notify the parties at
least five (5) business days in advance of the time and place, with a copy of
the notification to the Arbitrators. All hearings shall be held in the City of
Chicago, State of Illinois. If it is determined by the Administrator that it is
necessary, for any reason, to postpone the time of hearing, he shall notify the
parties. When a new date for hearing is set, the parties shall be notified as
soon as practicable and no less than five (5) business days before the hearing
unless the time limit is waived. (08/01/94)
630.06 Witnesses, Subpoenas, Depositions - Arbitrators and parties shall have
such powers in regard to compelling attendance of witnesses or the production of
documents or things, or the taking of depositions, as are provided in the
Uniform Arbitration Act of Illinois. (08/01/94)
630.07 Oath of Arbitrators - All Arbitrators shall be sworn faithfully and
fairly to hear, examine, and determine all controversies and to make awards
according to the best of their understanding. Such oath may be administered by
any person authorized to administer oaths. (08/01/94)
Ch6 D. Procedure
----------------
630.08 Hearing Procedures
A. The Arbitrators may allow stipulations and establish such other procedures
as may simplify the issues and expedite the hearing. The Arbitrators may
hear and determine the controversy upon the evidence produced,
notwithstanding the failure of a party duly notified to appear or to present
evidence.
B. Each of the parties or his attorney shall be permitted to make an opening
statement; present witnesses and evidence material to the controversy;
cross-examine witnesses, including parties to the arbitration; and present
closing arguments orally or in writing as may be determined at the hearing
by the Arbitrators. The Arbitrators shall not be bound by formal rules of
evidence. The Arbitrators shall receive and consider the evidence of
witnesses by affidavit, but shall give it only such weight as they deem it
entitled to after consideration of any objections made to its submission.
All testimony shall be taken under oath or affirmation. The hearing shall be
formally declared closed by the Arbitrators. Such hearings may, however, in
the discretion of the Arbitrators, be reopened at any time prior to the
making of an award.
C. The Arbitrators may, when they deem it appropriate, record the proceedings
in whatever manner they determine. Any party may require the proceedings to
be transcribed if he agrees to pay the actual cost of such transcription.
The Administrator shall make the necessary arrangements for the taking of a
stenographic record whenever such record is requested. (08/01/94)
630.09 Amendments To Pleadings - At any time before the hearings are declared
closed, any party may move to amend his pleadings to conform to the evidence
and, if the Arbitrators shall permit the amendment, the case shall be determined
on the amended pleadings. (08/01/94)
630.10 Adjournments - The Arbitrators may adjourn the hearings from time to
time upon the application of either party for good cause or at their own
instance. (08/01/94)
630.11 Notice and Communications - Notices shall be given to the parties by the
Administrator or otherwise as the Arbitrators may direct. (08/01/94)
630.12 Arbitration Procedures For Claims Under $2,500
A. Where claims of the parties including counterclaims, if any, are under
$2,500 in the aggregate, the dispute shall be resolved by the Arbitrators
solely upon the pleadings and documentary evidence filed by the parties. A
party shall have the right to take the deposition of any other party in the
manner and upon terms designated by the Arbitrators.
B. Notwithstanding the provisions of this Regulation, the Arbitrators may
request the submission of further evidence in the proceedings, and the
Arbitrators may, by a majority vote, call and conduct a hearing if such is
deemed to be necessary. (08/01/94)
630.13 Rulings and Awards
A. All rulings and awards shall be by a majority vote of the Arbitrators.
B. The award shall be in writing and signed by the Arbitrators joining in the
award. Such award shall be promptly rendered according to the Rules and
Regulations of the Association and the laws of the land, and the award shall
be final. The Arbitrators shall file the award with the Administrator and
the Administrator shall deliver or mail a copy to each party.
C. Failure to comply with an order or award of the Arbitration Committee or to
pay the full amount of the award to the Exchange as escrow agent within
thirty (30) days of notice of the order or award shall be deemed to be a
failure to perform an Exchange contract in accordance with Rule 278.00
The amount of the award placed in escrow with the Exchange plus accrued
interest shall be released to the prevailing party ninety-one days after
notice of the award is issued unless a timely motion to vacate, modify or
correct the award has been filed with a court of competent jurisdiction, in
which case the amount shall continue to be held by the Exchange and together
with accrued interest shall be disbursed upon the entry of and in accordance
with a final order disposing of such motion. (08/01/94)
630.14 Change of Award - On application of a party to the Arbitrators, the
Arbitrators may modify or correct the award in accordance with the Uniform
Arbitration Act of Illinois. (08/01/94)
Ch6 E. Miscellaneous Provisions
640.01 Fees and Expenses - A schedule of arbitration fees shall be established
from time to time by the Arbitration Committee, with the approval of the Board.
The Arbitrators, in the award, shall fix expenses and assess fees, in accordance
with the Committee's schedule, in whatever manner they deem appropriate,
provided that incremental costs associated with the selection of a Mixed Panel
by a customer shall be borne by the member regardless of the outcome of the
arbitration unless the arbitrators shall determine that the customer acted in
bad faith in initiating, or participating in, the arbitration proceeding.
Parties shall be notified prior to the submission of a claim of the nature and
amount of fees and expenses which may be assessed against the parties to the
extent that the amount of such fees and expenses may be determined prior to
submission and hearing of the claim. (08/01/94)
640.02 Ex Parte Contacts - Parties are prohibited from making ex parte contacts
with any Arbitrator hearing an arbitration between the parties. (08/01/94)
640.03 Holdover Arbitrators - Whenever the Arbitrators have begun to hear or
review evidence and argument in any arbitration proceeding, and the term of one
or more of the Arbitrators expires, such Arbitrator or Arbitrators shall
continue in office until the arbitration proceeding has ended. A holdover member
shall not participate in any other Committee business, nor shall his
continuation in office impair the appointment of his successor or his
successor's right to participate in all other Committee business. (08/01/94)
640.04 Power to Decline Jurisdiction - Arbitrators may decline jurisdiction in
any case, except as provided by law. The Arbitrators may, at any time during the
proceeding, except as provided by law, and shall, upon the joint request of the
parties, dismiss the proceeding. (08/01/94)
640.05 Compliance With Applicable Laws - The Regulations of this Chapter shall
be so construed as to comply with applicable mandatory provisions of the
Commodity Exchange Act (including Regulations thereunder) and all mandatory
provisions of the Uniform Arbitration Act of Illinois and, where in conflict
with the mandatory provisions of such Act or Acts, the Acts shall prevail.
However, these Regulations, being an integral part of all agreements for the
arbitration of disputes pursuant hereto, shall supersede all provisions of the
Acts which are waivable by agreement. (08/01/94)
[Download Table]
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Chapter 7
Clearing House, Deposits for Security
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Ch7 Clearing House..............................................
700.00 Settlement by Clearance............................
701.00 Rights of Board....................................
702.00 Clearing House By-Laws.............................
703.00 Membership in Clearing House.......................
703.00A Office Location and Operation......................
703.00B Transition Period for Amended Rule 703.00..........
704.00 Substitution.......................................
705.00 Offsets............................................
705.01 Reporting (Margins)................................
705.02 Reporting (Offsets)................................
706.00 Trades for Customers...............................
Ch7 Deposits for Security.......................................
720.00 Amount Callable....................................
721.00 Depositaries.......................................
722.00 Certificates.......................................
723.00 Disposition of Duplicate Certificates..............
724.00 Existing and Future Exchange Contracts.............
725.00 Notice of Call.....................................
726.00 Failure to Make Deposit............................
727.00 Return of Deposits.................................
728.00 Release of Excessive Deposits......................
729.00 Deposits to Secure Clearing House..................
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Chapter 7
Clearing House, Deposits for Security
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Ch7 Clearing House
700.00 Settlement by Clearance - All contracts, including contracts made by
members upon behalf of non-members, shall be cleared through the Clearing House,
and all such contracts shall be subject to the Charter, By-Laws, and Clearing
Regulations of the Clearing House; except in security contracts unless otherwise
stipulated in the bid or offer or it is otherwise agreed by the parties to the
contract, or the Clearing House, either in the particular instance or in
pursuance of its By-Laws and Resolutions, will not act in the matter. 310
(09/01/94)
701.00 Rights of Board - During 1936 the Board, by the affirmative vote of
fourteen Directors and thereafter by the affirmative vote of twelve Directors,
may discontinue the clearance of commodities and securities contracts through
the Clearing House, and provide for such other method of clearance as may be
selected. 311 (08/01/94)
702.00 Clearing House By-Laws - The Clearing House may not change its By-
Laws without the consent of the Board. 312 (08/01/94)
703.00 Membership in Clearing House - The Clearing House may prescribe the
qualifications of its own members. However, no person, corporation, limited
liability company, partnership, or any other type of eligible business
organization (hereinafter collectively referred to as "Eligible Business
Organization") shall become a member of the Clearing House until approved by the
Membership Committee, subject to the following conditions:
(a) No Eligible Business Organization shall become a member of the Clearing
House for the purpose of clearing trades for others unless the chief
executive officer of a corporation, the managing partner of a partnership,
or the managing member of a limited liability company has registered his or
her membership privilege for the use of the Eligible Business Organization
pursuant to Rule 230.00 and the provisions of paragraph (d) below are met.
For good cause shown and if approved by the Membership Committee with the
concurrence of the Governors of the Clearing House, the Eligible Business
Organization may designate its principal managerial employee instead of the
individual referred to above. For the purpose of this Rule, a principal
managerial employee shall be the highest ranking managerial employee in the
Eligible Business Organization whose duties pertain to the management of
the Eligible Business Organization or any division thereof, and who is in a
position to influence the Eligible Business Organization's operations with
respect to commodities business. The ability to influence the eligible
Business Organization's operation with respect to commodities business
includes, but is not limited to, the following:
(1) the ability to commit the Eligible Business Organization's capital
whenever required by the Exchange or the Board of Trade Clearing
Corporation.
(2) the ability to liquidate or otherwise adjust the Eligible Business
Organization's commodity futures or options positions as directed by
the Exchange; and
(3) the authority to appear before and respond to any committee of the
Exchange on behalf of the Eligible Business Organization.
(b) An individual member of the Association or a registered partnership or a
limited liability company consisting of a husband and wife who are members,
may be a member of the Clearing House provided that they clear trades
exclusively for their own account.
(c) No Eligible Business Organization may be a member of the Clearing House for
the purpose of clearing its own trades exclusively unless one of its
managerial employees has registered his or her membership for the use of
the Eligible Business Organization as provided in Rule 230.00.
The provisions of the foregoing paragraph shall apply to an Eligible
Business Organization which is solely owned provided that the sole owner is
a member of the Association and has registered his or her membership for
the use of the Eligible Business Organization with the approval of the
Membership Committee under the provisions of Rule 230.00. In such a case,
the Eligible Business
Ch7 Clearing House
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Organization may be a member of the Clearing House for the purpose of
clearing its own trades exclusively.
(d) An Eligible Business Organization may be a member of the Clearing House and
clear trades for others if it conducts a substantial and continuing
business in commodity futures contracts on the Exchange directly with the
trading public and if two memberships for the use of the Eligible Business
Organization are registered under the provisions of Rule 230.00. One of
the memberships to be registered must be that of the chief executive
officer of a corporation, the managing partner of a partnership, or the
managing member of a limited liability company, as applicable. The second
membership to be registered must be that of the second ranking managerial
employee of the Eligible Business Organization.
The Membership Committee, in its discretion and for good cause shown, may
allow an Eligible Business Organization to register a membership in the
name of a managerial employee of the Eligible Business Organization other
than the second ranking managerial employee in order to satisfy the
requirements of this paragraph (d) when the second ranking managerial
employee fails to meet the qualifications of the term managerial employee
as defined in Rule 230.00.
(e) A lawfully formed and conducted cooperative association of producers having
adequate financial responsibility and which is engaged in any cash
commodity business, may clear trades through the Clearing House provided it
meets the registration requirements for Eligible Business Organizations as
set forth in this Rule.
(f) A member firm which is also a clearing member firm of the Association or a
managerial employee of such firm shall not be prohibited from owning,
controlling, or being a shareholder, member or limited partner in one other
clearing member firm provided that when both clearing members are
corporations, the second clearing member is a 100% wholly owned subsidiary
of the first clearing member corporation and further provided that each
clearing member must, in its own right, meet all the conditions and
requirements contained in this chapter.
(g) An Eligible Business Organization which is not a clearing member of this
Association shall not be prohibited from owning and controlling two
clearing members, provided that each of the two clearing members is a 100%
wholly-owned subsidiary of the Eligible Business Organization and provided
that each of the two clearing members meets all of the conditions and
requirements contained in this chapter in its own right.
(h) For the purpose of Rule 703.00 (c), (f) and (g), the registrant of a
corporation shall be its chief executive officer or, for good cause shown,
its principal managerial employee as defined in paragraph (a) above; the
registrant of a partnership shall be its managing partner or, for good
cause shown, its principal managerial employee as defined in paragraph (a)
above; and the registrant of a limited liability company shall be its
managing member or, for good cause shown, its principal managerial employee
as defined in paragraph (a) above. (04/01/98)
703.00A Office Location and Operation - To be eligible for clearing
privileges, an Eligible Business Organization must:
Maintain its own separate office in Chicago, Illinois, in a location
satisfactory to the Clearing House and under the direct supervision of the
clearing member, if an individual, or of a member in good standing having
full authority to transact business with the Clearing House for and on
behalf of the clearing member, including entering into Exchange and
members' contracts, if an Eligible Business Organization; or
Use a facilities manager that maintains an office in Chicago, Illinois, and
that is acceptable to the Clearing House.
Provided, however, that the Board of Governors of the Clearing House may permit
individual members, as well as partnerships and limited liability companies
composed only of members, to share office space if they clear only their
personal trades and carry no accounts for customers. 31R (04/01/98)
703.00B Transition Period for Amended Rule 703.00 - Any eligible business
organization which is not in compliance with the terms of amended Rule 703.00 on
its effective date shall have six (6) months from that date to comply with the
terms of the Rule as amended. (04/01/98)
704.00 Substitution - Where a future delivery contract is cleared through the
Clearing House,
Ch7 Clearing House
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the Clearing House shall be deemed substituted as seller to the buyer, and shall
also be deemed substituted as buyer to the seller, and thereupon the Clearing
House shall have all of the rights and be subject to all of the liabilities of
the original parties with respect to such contract. 314 (08/01/94)
705.00 Offsets - Where a member buys and sells the same commodity for the
same delivery, and such contracts are cleared through the Clearing House, the
purchases and sales shall be offset to the extent of their equality, and the
member shall be deemed a buyer from the Clearing House to the extent that his
purchases exceed his sales, or a seller to the Clearing House to the extent that
his sales exceed his purchases. 315 (08/01/94)
705.01 Reporting (Margins) - A bona fide hedger, in financial instruments,
may report positions on a gross basis provided appropriate margins are paid
during the delivery month, on the gross positions reported, as required by
Regulation 431.02. (18) (08/01/94)
705.02 Reporting (Offsets) - A bona fide hedger, in financial instruments,
reporting consistently on a gross basis under Regulation 705.01 shall, during a
delivery month settle gross positions only by offsetting such positions through
trades in the pit. During non-delivery months, and not later than three days
prior to the first day of the delivery month, gross positions may be offset as
provided for in the Rules of the Association. (08/01/94)
706.00 Trades for Customers* - Where a member makes a trade for future
delivery of commodities for a customer (member or non-member) and the trade is
cleared through the Clearing House, the Clearing House becomes the principal who
is liable to the customer and to whom the customer is liable, subject to the
following: (a) the trade shall remain subject to the Charter, By-Laws, and
Resolutions of the Clearing House; (b) the trade may be offset against other
trades of the clearing member as provided in Rule 705.00; (c) if the trade is
not offset and the member being a seller, tenders a delivery notice to the
Clearing House, the member to whom such delivery is assigned, under Rule
1048.00, shall thereupon be substituted as buyer in lieu of the Clearing House;
(d) if the trade is not offset, and the member, being a buyer, is assigned a
delivery under Rule 1048.00, the seller whose delivery is thus assigned shall
thereupon be substituted as seller in lieu of the Clearing House; (e) if the
trade is offset, the Clearing House shall be discharged, and the member himself
shall be substi-tuted for the Clearing House as principal. For the purpose of
this Rule, the first trades made shall be deemed the first trades offset. 316
*See also Board of Trade Clearing Corporation By-Law 515. (08/01/94)
Ch7 Deposits for Security
720.00 Amount Callable - On future delivery contracts, buyers may require
sellers and sellers may require buyers to deposit, as security for faithful
performance, such percentage of the market price of the commodities bought or
sold as shall not be in excess of the standing margin requirements of the
Clearing House. 260 (08/01/94)
721.00 Depositaries - All such deposits shall be made with the Treasurer, or
with a bank approved by the Board. Such bank must have at least one executive
officer who is a member, and must file a bond, approved by the Board,
conditioned to dispose of such deposits according to the Rules. 261 (08/01/94)
722.00 Certificates - The depositary shall issue a certificate of deposit in
duplicate, giving the date and amount of the deposit and the name of the
depositor and the beneficiary. It shall also state that the certificate is
subject to the Rules of the Association. 262 (08/01/94)
723.00 Disposition of Duplicate Certificates - The depositor, within one hour
after the call for the deposit, must deliver the duplicate certificate of
deposit to the Clearing House or to the beneficiary. 263 (08/01/94)
724.00 Existing and Future Exchange Contracts - Unless otherwise provided all
deposits shall constitute security for the performance of all existing or
future Exchange contracts between the parties. 264 (08/01/94)
725.00 Notice of Call - Calls for deposits may be served personally upon the
party called or upon his clerk or representative on Change, or by written notice
left at his place of business. If he has no place of business and cannot be
found, the call may be made by written notice left at the Office of the
Secretary. 265 (08/01/94)
726.00 Failure to Make Deposit - Failure to make deposits for one hour after
demand shall authorize but not obligate the other party to close out the trades
for which security was demanded. If such trades are closed, the delinquent shall
be immediately notified, whereupon any loss upon such trades shall be
immediately payable through the Clearing House. 266 (08/01/94)
727.00 Return of Deposits - Upon performance or closing out of contracts
secured by deposits, or upon the assumption of such contracts by the Clearing
House, such deposits may be withdrawn upon the joint endorsement of depositor
and beneficiary. If they cannot agree as to the disposition of the deposit,
either party may apply to the Chairman of the Arbitration Committee, who shall
appoint a special committee of three arbitrators before whom the dispute shall
be arbitrated. The Committee shall report their findings to the Chairman of the
Arbitration Committee, and thereupon the Chairman of the Arbitration Committee
shall endorse the original or duplicate certificate in accordance therewith.
Such endorsement shall authorize the depositary to pay the deposit as directed.
267 (08/01/94)
728.00 Release of Excessive Deposits - If, by reason of market fluctuations,
any deposit becomes excessive, the excess shall be released, either by the joint
action of the interested parties, or by the Chairman of the Arbitration
Committee, as provided in Rule 727.00. 268 (08/01/94)
729.00 Deposits to Secure Clearing House - The foregoing provisions of this
Chapter shall not apply as between clearing members and the Clearing House.
Deposits to secure the Clearing House shall be pursuant to the By-Laws of the
Clearing House. 269 (08/01/94)
[Download Table]
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Chapter 9
Definitions
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Ch9 Definitions....................................................
901.00 Authority.............................................
902.00 And...................................................
903.00 Association...........................................
903.01 Association...........................................
904.00 Board.................................................
905.00 Bulletin Board........................................
906.00 Business Day..........................................
906.03 Regular Trading Hours ("RTH").........................
906.04 Trading Day...........................................
906.05 Trading Session.......................................
906.06 e-cbot Trading Hours..................................
907.00 Cash Grain............................................
908.00 Cash Grain Broker.....................................
909.00 Chicago District......................................
910.00 Check Slips...........................................
911.00 Clearing House........................................
912.00 Clearing Member.......................................
913.00 Commission Merchant...................................
914.00 Commodity.............................................
915.01 DRT ("Disregard Tape" or "Not Held") Order............
915.02 All or None Order.....................................
916.00 Exchange Contracts and Members' Contracts.............
917.00 Floor Broker..........................................
918.00 Following Day, or other similar expression............
919.00 Future Delivery Contract..............................
920.00 Grain.................................................
921.00 Grain to Arrive.......................................
922.00 Holiday...............................................
923.00 List..................................................
924.00 Member................................................
924.01 Membership on Committees..............................
925.00 Non-clearing Member...................................
926.00 Non-member............................................
927.00 Notice................................................
928.00 On the Exchange, or on Change.........................
929.00 Outside Points........................................
930.00 President.............................................
931.00 Privilege of the Floor................................
932.00 Railroad Receipts.....................................
933.00 Regulations...........................................
934.00 Rules.................................................
935.00 Secretary.............................................
936.00 Security or Securities................................
937.00 Singular..............................................
939.00 Spot Grain............................................
940.00 Stop Order or Stop Loss Order.........................
941.00 Board Order or Market If Touched Order................
942.00 Trade.................................................
943.00 Transaction on Change.................................
944.00 Treasurer.............................................
945.00 Chairman of the Board.................................
946.00 Financial Instrument Contract.........................
Definitions
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[Download Table]
948.00 Volatility Quote......................................
949.01 e-cbot................................................
949.02 e-cbot Terminal Operator..............................
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Chapter 9
Definitions
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Ch9 Definitions
901.00 Authority - Whenever used in these Rules and Regulations, unless the
context otherwise requires, the following words and expressions shall be defined
as follows: 1 (08/01/94)
902.00 And - May be construed as "or," and vice versa when the sense
requires. 2 (08/01/94)
903.00 Association - The Board of Trade of the City of Chicago. 3 (08/01/94)
903.01 Association - The term "Association" as defined in Rule 903.00 shall
include all wholly-owned subsidiaries of the Board of Trade of the City of
Chicago. (08/01/94)
904.00 Board - The Directors, the Chairman of the Board, the Vice Chairman of
the Board and the President. 4 (08/01/94)
905.00 Bulletin Board - The bulletin board in the Exchange Hall where notices
are customarily posted. 5 (08/01/94)
906.00 Business Day - Days when the Association is open for business. 6
(08/01/94)
906.03 Regular Trading Hours ("RTH") - Those hours designated by the Board of
Directors for trading during daytime hours by means of open outcry. (08/01/94)
906.04 Trading Day - (a) For agricultural contracts, each trading day (1)
shall consist of two trading sessions, the e-cbot trading session and the
Regular Daytime open outcry session, and (2) shall begin with the e-cbot trading
session and end with the close of Regular Daytime open outcry session. (b) For
contracts which are traded concurrently on e-cbot and by open outcry, the
trading day (1) shall consist of two trading sessions, the e-cbot trading
session and the Regular Daytime open outcry trading session, and (2) shall begin
with the e-cbot trading session and end with the later of the close of the e-
cbot trading session or the close of the Regular Daytime open outcry session.
Settlement prices will be derived from the close of the Regular Daytime open
outcry session, except in the case of contracts which are traded exclusively on
e-cbot. For contracts traded exclusively on e-cbot, settlement prices will be
derived from the close of the e-cbot trading session. (09/01/00)
906.05 Trading Session - A trading session shall mean either the hours
designated for e-cbot trading or the hours designated for regular daytime
trading. (09/01/00)
906.06 e-cbot Trading Hours - Those hours designated by the Board of
Directors for trading through the e-cbot automated order entry facility for
particular contracts. (09/01/00)
907.00 Cash Grain - Spot grain and grain to arrive. 7 (08/01/94)
908.00 Cash Grain Broker - A member who negotiates purchases or sales of cash
grain for a brokerage. 8 (08/01/94)
909.00 Chicago District - The Chicago District as now or hereafter defined in
the joint railroad tariffs of the railroads entering Chicago. 9 (08/01/94)
910.00 Check Slips - Confirmation of trades between members, as defined in
the By-Laws or Resolutions of the Clearing House. 10 (08/01/94)
911.00 Clearing House - The Board of Trade Clearing Corporation, or such
other corporation or agency as may be authorized to clear trades for members. 11
(08/01/94)
912.00 Clearing Member - A member of the Association who is also a member of
the Clearing House. 12 (08/01/94)
913.00 Commission Merchant - A member who makes a trade, either for another
member or for a non-member, but who makes the trade in his own name and becomes
liable as principal as between himself and the other party to the trade. 13
(08/01/94)
Definitions
-----------
914.00 Commodity - Any commodity which may be dealt in under Rules or
Regulations of the Association. 14 (08/01/94)
915.01 DRT ("Disregard Tape" or "Not Held") Order - An order giving the floor
broker complete discretion over price and time in execution of a trade,
including discretion to execute all, some or none of the order. It is understood
the floor broker accepts such an order solely at the risk of the customer on a
"not held" basis. (02/01/95)
915.02 All-or-None Order - An order to be executed only for its entire
quantity at a single price and with a size at or above a predetermined
threshold. (07/01/00)
916.00 Exchange Contracts and Members' Contracts - All contracts of members
of the Association, or of firms or corporations registered under the Rules and
Regulations, with other members of the Association, or firms or corporations
registered under the Rules and Regulations, for the purchase or sale of
commodities, or for the purchase, sale, borrowing, loaning, or hypothecation of
securities, or for the borrowing, loaning or payment of money, whether occurring
upon the floor of the Exchange or elsewhere, are members' contracts.
Exchange Contracts shall include all Members' Contracts:
(1) Made on the Exchange;
(2) Not made on the Exchange, unless made subject to the rules of another
Exchange, or unless the parties thereto have expressly agreed that the same
shall not be Exchange Contracts.
The provisions of the Rules and Regulations of the Association shall be part of
the terms and conditions of all Exchange Contracts and all such contracts shall
be subject to the exercise by the Board, the Standing Committees, and the
Clearing House of the powers in respect thereto, vested in them by the Rules and
Regulations. And all such contracts shall be subject to all Rules or Regulations
subsequently adopted, where such Rules or Regulations are expressly made
applicable to existing contracts. 16 (08/01/94)
917.00 Floor Broker - A member who makes contracts for the account of other
members. 17 (08/01/94)
918.00 Following Day, or other similar expression - The following business
day. 18 (08/01/94)
919.00 Future Delivery Contract - A contract made on Change for the purchase
or sale of any commodity for delivery in the future pursuant to the Rules and
Regulations. (08/01/94)
920.00 Grain - Wheat, corn, oats, rye, barley, flaxseed, soybeans and grain
sorghum. 20 (08/01/94)
921.00 Grain to Arrive - Grain originating at outside points for shipment to
or shipped to the Chicago District, subject to Chicago Board of Trade weights or
Chicago inspection. 21 (08/01/94)
922.00 Holiday - Any day declared to be a holiday by Regulation or Resolution
adopted by the Board of Directors of this Association. 22 (08/01/94)
923.00 List - The list of securities admitted to dealings on the Exchange. 23
(08/01/94)
924.00 Member - A member of the Association. 24 (08/01/94)
924.01 Membership on Committees - The term "member", as used throughout these
Rules and Regulations for eligibility for membership on Standing or Special
Committees, shall include only those members who hold a Full or Associate
Membership.
Delegates of Full or Associate Memberships who do not hold in their own name a
Full or Associate Membership are eligible to serve as full voting members on any
Standing or Special Committee of the Association, unless otherwise specified in
these Rules and Regulations, except for the following Committees:
Appellate; Arbitration; Business Conduct; Executive; Finance; Financial
Compliance; Floor Broker; Floor Conduct; Floor Governors; Hearing; Strategy;
Membership; Nominating; Regulatory Compliance; Audit; and Human Resources.
Definitions
-----------
The Chairman of the Board, or the Board, may appoint any such delegate to a
Special or Ad Hoc Committee if that delegate has unique and valuable expertise
to offer to that Committee. However, if any such Special or Ad Hoc Committee
shall later be determined to be a Standing Committee, the eligibility of any
such delegate as a full voting member on that Committee shall be referred to the
Regulatory Compliance Committee.
None of the foregoing shall prohibit the Chairman of the Board, or the Board,
from appointing such delegates as non-voting advisors to any committee.
(02/01/99)
925.00 Non-clearing Member - A member of the Association who does not clear
trades in his own name. 25 (08/01/94)
926.00 Non-member - A non-member of the Association. 26 (08/01/94)
927.00 Notice - A notice in writing served personally upon the person to be
notified, or left at his usual place of business during business hours, or
mailed by registered mail to his residence. 27 (08/01/94)
928.00 On the Exchange, or on Change - In the Exchange Halls or through
Exchange facilities including an approved automated order entry facility during
trading hours on business days. 28 (08/01/94)
929.00 Outside Points - Points outside of the Chicago District. 29 (08/01/94)
930.00 President - The Chief Executive Officer of the Association. 30
(08/01/94)
931.00 Privilege of the Floor - The privilege of coming on the floor of the
Exchange. 31 (08/01/94)
932.00 Railroad Receipts - Bills of lading, or railroad receipts therefor, or
switching receipts. 32 (08/01/94)
933.00 Regulations - The Regulations of the Association adopted by the Board
or a Committee designated pursuant to Rule 132.00 to promulgate regulations. 33
(08/01/94)
934.00 Rules - The Rules of the Association adopted by the membership.
In all such expressions as "under the Rules," "according to the Rules:" or
"subject to the Rules," the word "Rules" shall mean the Charter, Rules, and
Regulations of the Association and all amendments thereto. 34 (08/01/94)
935.00 Secretary - The Secretary of the Association. 35 (08/01/94)
936.00 Security or Securities - Stocks, Bonds, Notes, Certificates of Deposit
or Participation, Trust Receipts, Rights, Warrants, and other similar
instruments. 36 (08/01/94)
937.00 Singular - Shall import the plural, and vice versa, when the sense
requires. 37 (08/01/94)
939.00 Spot Grain - Grain located in the Chicago District subject to sale for
immediate delivery. 39 (08/01/94)
940.00 Stop Order or Stop Loss Order - An order to buy or sell when the
market reaches a specified point. A stop order to buy becomes a market order
when the commodity or security sells (or is bid) at or above the stop price. A
stop order to sell becomes a market order when the commodity or security sells
(or is offered) at or below the stop price. 40 (08/01/94)
941.00 Board Order or Market If Touched Order - An order to buy or sell when
the market reaches a specified point. A board order, or a market if touched
order to buy becomes a market order when the commodity or security sells (or is
offered) at or below the order price. A board order or a market if touched order
to sell becomes a market order when the commodity or security sells (or is bid)
at or above the order price. 40A (08/01/94)
942.00 Trade - Transaction on change executed in the Exchange Halls or
through Exchange facilities including an approved automated order entry
facility. 41 (08/01/94)
Definitions
-----------
943.00 Transaction on Change - Any purchase or sale of any commodity or
security in the Exchange Halls or through Exchange facilities including an
approved automated order entry facility system during trading hours on business
days. 42 (08/01/94)
944.00 Treasurer - The Treasurer of the Association. 43 (08/01/94)
945.00 Chairman of the Board - The presiding officer of the Board of
Directors. 29A (08/01/94)
946.00 Financial Instrument Contract - Financial Instrument Contract means
any contract in respect to Mortgage Backed Certificates Guaranteed by the
Government National Mortgage Association, obligation of the United States or
other public agencies, private commercial paper and any other instrument
evidencing or securing a contribution, loan or borrowing of funds which may be
designated as a Financial Instrument Contract by the Board of Directors.
(08/01/94)
948.00 Volatility Quote - An alternative means of quoting options, or
combinations involving options, by bidding or offering the implied volatility.
Any transactions quoted in volatility terms will be translated into price terms
for clearing purposes by means of a standard options model maintained and
disseminated by the Exchange. (08/01/94)
949.01 e-cbot - e-cbot is a screen-based electronic trading system for
trading futures and options on futures contracts and such other products as
determined by the Board pursuant to Chapter 9B. (09/01/00)
949.02 e-cbot Terminal Operator - An e-cbot terminal operator is a person who
has been identified to the Exchange by an individual member or member firm as
authorized to enter orders through e-cbot. (09/01/00)
[Enlarge/Download Table]
======================================================================================
Chapter 9B
e-cbot(R)
======================================================================================
Ch9B e-cbot(R).............................................................
9B.01 Applicability of Rules.......................................
9B.02 Hours........................................................
9B.03 Products.....................................................
9B.04 Access.......................................................
9B.05 Trading Requirement..........................................
9B.06 e-cbot Terminal Location.....................................
9B.07 e-cbot Terminal Operators....................................
9B.08 Clearing Member Authorization................................
9B.09 e-cbot Opening...............................................
9B.10 e-cbot Orders................................................
9B.11 Order Entry..................................................
9B.12 Spreads/Reversals/Conversion Transactions....................
9B.13 Give-ups.....................................................
9B.14 Bunched Orders...............................................
9B.15 Misuse of e-cbot.............................................
9B.16 Trading Against Customers' Orders Prohibited.................
9B.16A Trading Against Own Orders Prohibited........................
9B.17 Priority of Execution........................................
9B.18 Disciplinary Procedures......................................
9B.19 Termination of Access........................................
9B.20 Records of Transactions Effected Through the e-cbot System...
9B.21 e-cbot Limitation of Liability...............................
9B.22 Volatility Quotes............................................
9B.23 e-cbot Customer Information Statement........................
9B.24 e-cbot Foreign Affiliates....................................
9B.25 Cabinet trades...............................................
================================================================================
Chapter 9B
e-cbot(R)
================================================================================
Ch9B e-cbot(R)
9B.01 Applicability of Rules - The rules and regulations contained in this
Chapter govern those Exchange contracts which are traded through the e-cbot
system. To the extent that the provisions in this Chapter conflict with rules
and regulations in other sections of this Rulebook, this Chapter supersedes such
rules and regulations and governs the manner in which contracts are traded
through the e-cbot system. Otherwise, contracts traded on the e-cbot system are
fully subject to applicable general rules and regulations of the Exchange unless
specifically and expressly excluded therefrom. (09/01/00)
9B.02 Hours - The Board of Directors shall expressly determine the hours
during which the e-cbot system shall operate for the trading of each contract or
product; however, any such agricultural contract or product shall be precluded
from trading through the e-cbot system during those hours which are now or in
the future designated for trading that contract or product by means of open
outcry.
On the last day of trading of an expiring future, a system notice will be sent
to all users on the e-cbot system designating the beginning of the one minute
close of the expiring future. Trading shall be permitted thereafter for a
period not to exceed one minute.
The following additional provisions shall apply with respect to agricultural
contracts and agricultural products:
- The Board of Directors shall determine e-cbot trading hours only if such
hours are between 6:00 p.m. and 6:00 a.m. (Chicago time).
- e-cbot trading hours outside of the 6:00 p.m. to 6:00 a.m. timeframe shall
be subject to approval by membership ballot vote pursuant to Rule 109.00.
(09/01/00)
9B.03 Products - The Board of Directors shall determine the contracts and/or
products which shall be traded through or listed on the e-cbot system, subject
to the following restriction:
Each existing and prospective agricultural futures and options contract
shall be restricted from trading through or listed on the e-cbot system
unless approved by affirmative vote of a majority of votes cast in a
vote of the membership pursuant to Rule109.00. (09/01/00)
9B.04 Access - Every member of the Exchange who has registered with the
Exchange, in the manner prescribed by the Exchange, is eligible to effect
transactions through the e-cbot system in such contracts which are designated
for trading by the category of his or her respective membership or membership
interest. Solely for purposes of this Chapter, the owner or delegate of a Full
or Associate Membership shall be entitled to register under Rule 230.00 for an
eligible business organization admitted to trading at Eurex Deutschland, solely
to conduct non-clearing business on e-cbot. (09/01/00)
9B.05 Trading Requirement - Members and terminal operators must complete a
general proficiency course prior to obtaining access to the system. (09/01/00)
9B.06 e-cbot Terminal Location - The placement of terminals with access to e
-cbot shall be in accordance with these Rules, and placement of terminals with
e-cbot access in other locations shall be with the approval of the Board.
(a) Floor Terminals - Terminals with access to e-cbot shall be located on
the floor of the Exchange for use by members registered with the
Exchange. Terminals may also be placed within a member firm's floor
booth space for use by members and non-member terminal operators who do
not maintain an associated person registration.
(b) Office Terminals - Upon application to the Exchange, a terminal with
access to e-cbot may be located within the offices of a member or member
firm. The number of terminals located within the offices of a member
firm, excluding individual members' terminals, accessing e-cbot at any
one time shall not exceed the number of memberships registered with the
Exchange on behalf of the member firm pursuant to Rule 230.00; provided
that the foregoing limitation shall not apply to a member firm for
terminals which are located within its offices and which: (1) are
utilized for the entry of orders on behalf of customers of the member
firm or (2) are utilized for the entry of orders for the member firm's
own accounts as that term is used in Regulation 450.02. (09/01/00)
e-cbot(R)
9B.07 e-cbot Terminal Operators - Each e-cbot terminal operator shall be
identified to the Exchange by the individual member or member firm employing
such terminal operator, in the manner prescribed by the Exchange, and shall be
subject to the rules of the Exchange, including but not limited to the rules of
this Chapter and rules relating to order handling, trade practices and
disciplinary proceedings. It shall be the duty of the member or member firm to
supervise the e-cbot terminal operator's compliance with Exchange rules, and any
violation thereof by such terminal operator may be considered a violation by the
member or member firm. Each member or member firm employing an e-cbot terminal
operator shall notify the Exchange immediately, in the manner prescribed by the
Exchange, whenever the terminal operator's authority to act as such has been
revoked. Each member firm employing an e-cbot terminal operator must make
appropriate provisions, consistent with the rules of the Exchange, for the entry
of any e-cbot orders in the event that its terminal operator is, or all of its
terminal operators are, unavailable to perform such function. (09/01/00)
9B.08 Clearing Member Authorization - Each non-clearing member who enters
transactions through the e-cbot system for contracts which are guaranteed and
cleared by the Clearing House, must obtain authorization from a single clearing
member (the "Primary Clearing Member"). The Primary Clearing Member shall
guarantee and assume financial responsibility for all such contracts traded
through e-cbot by such non-clearing member. A non-clearing member must furnish
the Exchange with written authorization from the Primary Clearing Member
permitting such non-clearing member, without qualification, to submit trades
effected through the e-cbot system through the Primary Clearing Member. The
Primary Clearing Member shall be liable upon all such trades made by the non-
clearing member and shall be a party to all disputes arising from trades between
the authorized non-clearing member and another member or member firm.
A non-clearing member may be authorized to enter transactions through the e-cbot
system by a clearing member other than the member's Primary Clearing Member
pursuant to Rule 333.00, provided written permission has been granted by the
non-clearing member's Primary Clearing Member, and provided further that the
non-clearing member is not authorized to enter transactions through the e-cbot
system by his Primary Clearing Member or any other clearing member.
A clearing member that provides e-cbot trading authorization to a non-clearing
member may, revoke such authorization and such user's access to e-cbot without
prior notice. Written notice of the revocation of clearing authorization shall
be provided to the Exchange, and shall thereby cancel all orders of the non-
clearing member in the e-cbot system. Unless otherwise specified by the non-
clearing member's Primary Clearing Member, a member whose access to e-cbot has
been revoked shall not automatically be denied access to the Floor of the
Exchange during Regular Trading Hours. A non-clearing member whose Primary
Clearing Member has revoked authorization shall be denied access to e-cbot until
another clearing member has designated itself as the non-clearing member's
Primary Clearing Member.
In the case of a member who has been provided an e-cbot authorization from a
clearing member other than his Primary Clearing Member, the Primary Clearing
Member may terminate the member's ability to place orders through the e-cbot
system by notifying the clearing member providing the authorization, who will be
responsible for ensuring that the user is not able to place orders through the
e-cbot system. (09/01/00)
9B.09 e-cbot Opening -
(a) Prior to the commencement of trading, orders and quotes may be
entered into the e-cbot system until the time set by the Exchange.
(b) Trading begins with the determination of an opening price for each
option series and each futures contract. The Opening Period consists of
the Pre-Opening period and the netting process. For the purpose of
determining a particular opening price, additional orders and quotes
may be entered until a time established by the Exchange; a preliminary
opening price will be continuously displayed during this period (the
"Pre-Opening Period"). Quotes may be individually canceled or amended
during the Pre-Opening Period, but all quotes for an individual product
may not collectively be changed, canceled or withdrawn from trading
during this period. During the subsequent netting process, the greatest
possible number of
e-cbot(R)
orders and quotes contained in the system shall be matched for the
purpose of determining a final opening price of each option series and
futures contract. The Exchange does not guarantee the execution of any
order or quote at such opening price.
The Opening Period with respect to a product shall end as soon as the
netting process has been completed for all option series and/or all
futures contracts based on such product.
If no market orders exist for any option series or futures contract and
matching between limit orders or limit orders and quotes is not
possible, the Opening Period shall end without the determination of an
opening price.
(c) Options contracts will not open until the underlying futures contract
has opened. (09/01/00)
9B.10 e-cbot Orders - An e-cbot order may contain one of the following
designations:
(a) Day Open - an order which, by its terms, will be cancelled, if not
executed, at the conclusion of the trading day.
(b) Good-Till-Cancelled ("GTC") Open - an order which, by its terms, will
be eligible for execution for the current and all subsequent e-cbot
trade sessions until executed or cancelled.
(c) Stop orders to buy or sell futures contracts that specify a price and
are designated as "stop orders" at the time of entry. If the price
specified in a stop order (the trigger price) is reached or exceeded,
the stop order will be converted into a market order pursuant to an
automatic selection process in the chronological order of their entry.
These orders will then be executed in the order of the times of their
conversions to market orders along with any other incoming market
orders, in accordance with the general principles for matching of
market orders for futures contracts. Stop orders will be entered into a
separate order book.
(d) Market orders - an order to buy or sell a stated quantity at the best
price obtainable.
(e) Fill-or-kill - an order which, by its terms, is cancelled if it is not
filled in full immediately.
(f) Limit order to buy or sell - an order to buy or sell a stated quantity
at a specified price, or at a better price, if obtainable. (09/01/00)
9B.11 Order Entry - (a) Individual members are eligible to enter into the
e-cbot system such orders as their membership category permits.
(b) An individual member or a non-member terminal operator who is registered as
a floor broker or associated person may (1) enter orders on behalf of customers
of a clearing member or (2) supervise the entry of orders with the prior
approval of the clearing member responsible to clear such orders.
(c) Customer orders must be (1) entered from a terminal located on the floor, in
a main office or in a branch office registered with the Exchange pursuant to
Rule 475.00, or (2) received from an automated order entry system at a server
located at a main office or branch office registered with the Exchange.
(d) However, if an individual member does not maintain an associated person or
floor broker registration, but is employed in the office or branch office of a
member firm, the member may enter customer orders subject to the same
restrictions that apply to a non-member employee except that a member may enter
his own orders.
(e) Member firms are eligible to enter into the e-cbot system such proprietary
and customer orders as their membership registration permits.
(f) Non-member employees of a member firm who do not maintain an associated
person or floor broker registration with the Commodity Futures Trading
Commission or comparable registration under applicable law may:
(1) Enter customer orders only on a non-discretionary basis;
(2) Enter orders for the member firm's account from e-cbot terminals located on
the trading floor only on a non-discretionary basis;
(3) Enter orders for the proprietary account of the member firm or its wholly-
owned affiliate from e-cbot
e-cbot(R)
terminals located off of the trading floor on a discretionary or non-
discretionary basis. However, such individuals may enter proprietary orders
on a discretionary basis only if they trade solely for such proprietary
accounts, and do not enter or handle customer orders; and
(4) Not be compensated on a commission or per contract basis for customer
orders.
(g) Non-member employees of a member firm who are registered as associated
persons or floor brokers may enter customer orders and orders for the
proprietary account of the member firm or its wholly-owned affiliate on a
discretionary or non-discretionary basis.
(h) Non-member employees of a member or member firm shall not have any interest
whatsoever in an account which contains positions in contracts or products
traded through e-cbot.
(i) A non-member employee of an individual member or member firm may enter
orders for customers of an individual or entity other than his/her employer
solely for purposes of disaster recovery.
(j) A non-member terminal operator registered as an associated person or floor
broker is prohibited from entering orders into terminals located on the Floor.
(k) It shall be the duty of each member or terminal operator entering orders
into the e-cbot System to: (1) sign onto the e-cbot System before entering
orders by inputting the e-cbot user identification and (2) input for each order,
the price, quantity, commodity, contract month, CTI code and account
designation, and, for options, the strike price, "put" or "call," expiration
month, and whether the order initiates or closes a position.
With respect to orders received by a member or terminal operator which are
capable of being immediately entered into the e-cbot system no record other than
that set forth above need be made. However, if a member or terminal operator
receives an order which cannot be immediately entered into the e-cbot system,
the member or terminal operator must prepare a written order and include the
account designation, date, time of receipt and other required information. The
order must be entered into the e-cbot system when it becomes executable.
(09/01/00)
9B.12 Spreads/Reversals/Conversion Transactions- (See 352.01) and (See
352.01A) (09/01/00)
9B.13 Give-ups - Give-ups shall be handled in accordance with Regulation
444.01. (09/01/00)
9B.14 Bunched Orders - Bunched orders for discretionary accounts may be
entered through e-cbot. Such orders may be entered by using a series designation
rather than including each of the individual account numbers on the order. The
series designation may only be used when a written, pre-determined allocation
scheme that defines the series has been provided to the futures commission
merchant accepting the order prior to the time that such order is given. If such
information has not been provided to the futures commission merchant prior to
the time of order entry, each account number must be entered into e-cbot.
Bunched orders for non-discretionary accounts may be entered through e-cbot only
in the following instances:
A. The orders underlying the bunched order are either stop orders or
stop/limit orders;
B. Each stop order or stop/limit order underlying the bunched order must be
reduced to writing in accordance with Regulation 465.01;
C. Each order underlying the bunched order must reflect the same stop price
in instances of a stop order or the same stop price and limit price in
instances of a stop/limit order;
D. Each terminal operator must provide a bunched order indicator when
entering a bunched order; and
E. Allocation of the executed bunched order must be based only on time of
receipt of the underlying orders.
The Exchange shall make available to clearing members, at regular intervals,
notifications that bunched orders have been executed through e-cbot. Each
clearing member shall be responsible for providing to the Exchange the account
allocation for bunched orders entered through its terminals and those terminals
that it guarantees for others. Each clearing member that is required to provide
account allocations to the Exchange must do so within the time limit specified
by the Exchange. (09/01/00)
9B.15 Misuse of e-cbot - Misuse of the e-cbot system is strictly prohibited.
It shall be deemed an act detrimental to the interest and welfare of the
Exchange either willfully or negligently to engage in
e-cbot(R)
unauthorized access to e-cbot, to assist in any individual's obtaining
unauthorized access to an e-cbot terminal, to trade on the e-cbot system without
the authorization of a clearing member, to alter the equipment associated with
the system, to interfere with the operation of the system, to use or configure a
component of the system in a manner which does not conform to the Technical
Regulations set forth at Appendix 9B, to intercept or interfere with information
provided on or through the system, or in any way to use the system in a manner
contrary to the rules of the Exchange. (09/01/00)
9B.16 Trading Against Customers' Orders Prohibited - During an e-cbot trading
session, a member or e-cbot terminal operator shall not knowingly cause to be
entered, or enter into a transaction in which the member or e-cbot terminal
operator (or any other person or entity with whom the member or e-cbot terminal
operator has a relationship) assumes the opposite side of any order entered on
behalf of a customer except under the following circumstances:
A limit order to buy and a limit order to sell and/or quotes relating to the
same contract, if they are immediately executable against each other, may be
entered consecutively by a member or e-cbot terminal operator (a cross-trade)
if:
(a) the quantity of the cross-order at least the minimum established by
the Exchange and the elapsed time between the two entries is
(1) at least 15 seconds in the case of options contracts, and
(2) at least 5 seconds in the case of futures contracts; or
(b) prior to entering the order, the member or e-cbot terminal operator
enters a cross-request into the e-cbot system.
If a member or e-cbot terminal operator issues a cross-request (including the
intended quantity), it must enter the orders or quotes giving rise to the cross-
trade
- in the case of options, no less than 15 seconds but no more than 75
seconds after entry of the cross-request,
- in the case of futures contracts, no less than 5 seconds but not more
than 35 seconds after the entry of the cross request.
Violation of this provision shall constitute an act detrimental to the interest
and welfare of the Exchange. (09/01/00)
9B.16A Trading Against Own Orders Prohibited - During an e-cbot trading
session, a member shall not knowingly cause to be entered, or enter into, a
transaction in which the member assumes the opposite side of an order entered on
behalf of the member's own account. (09/01/00)
9B.17 Priority of Execution - Orders received by a member or e-cbot terminal
operator shall be entered into the e-cbot system in the order received. Orders
that cannot be immediately entered into e-cbot must be entered when the orders
become executable in the sequence in which the orders were received. (09/01/00)
9B.18 Disciplinary Procedures - All suspensions, expulsions and other
restrictions imposed upon a member by the Exchange pursuant to disciplinary
procedures contained in Chapters 2 and 5 of the Exchange's rules shall restrict
with equal force and effect access to and use of the e-cbot system by such
member. (09/01/00)
9B.19 Termination of Access - The Exchange shall have the right summarily to
terminate access to e-cbot in accordance with Regulation 201.02, Rule 270.00,
Regulation 270.01, Rule 278.00, Rule 521.00 and Regulation 540.06. (09/01/00)
9B.20 Records of Transactions Effected Through the e-cbot System - All
written orders and any other original records pertaining to transactions
effected through the e-cbot system must be retained for five years. Otherwise,
the data contained in the e-cbot system shall be deemed the original record of
e-cbot(R)
the transaction. The President or his designee may require immediate proof of
compliance with this provision. Violation of this provision may constitute an
act detrimental to the interest and welfare of the Exchange. (09/01/00)
9B.21 e-cbot Limitation of Liability - Except in instances where there has
been a finding of willful or wanton misconduct, in which case the party found to
have engaged in such conduct cannot avail itself of the protections in this
provision, neither the Exchange (including its subsidiaries and affiliates), the
Clearing House, Ceres Trading Limited Partnership, Ceres Alliance L.L.C.,
CBOT/Eurex Alliance L.L.C., Eurex Zurich AG, Eurex Frankfurt AG, Deutsche Borse
AG, the Swiss Stock Exchange, Deutsche Borse Systems AG, members, clearing
members, or other persons acting as agents nor any of their officers, directors
or employees, shall be liable for any loss, damage or cost (including attorney's
fees and court costs), whether direct, indirect, special, incidental,
consequential, lost profits or otherwise of any kind, regardless of whether any
of them has been advised or is otherwise aware of the possibility of such
damages, arising out of the use or performance of the e-cbot system, any
component(s) thereof, or any fault, failure, malfunction or other alleged defect
in the e-cbot system, including any inability to enter or cancel orders in the
e-cbot system, or any fault in delivery, delay, omission, suspension, inaccuracy
or termination, or any other cause in connection with the furnishing,
performance, maintenance, use of or inability to use all or any part of the e-
cbot system, including but not limited to, any failure or delay in transmission
of orders or loss of orders resulting from malfunction of the e-cbot system,
disruption of common carrier lines, loss of power, acts or failures to act of
any third party, natural disasters or any and all other causes.
The foregoing shall apply regardless of whether a claim arises in contract,
tort, negligence, strict liability or otherwise. The foregoing limitations are
cumulative and shall not limit or restrict the applicability of any other
limitation or any rule, regulation or bylaw of the Exchange or the Clearing
House. The foregoing shall include and apply to any action or inaction of any
employee or agent of the Electronic Trading Systems Control Center. The
foregoing shall not limit the liability of any member, clearing member, or other
person acting as agent or any of their respective officers, directors or
employees for any act, incident, or occurrence within their control.
There are no express or implied warranties or representations provided by the
Exchange (including its subsidiaries and affiliates), the Clearing House, Ceres
Trading Limited Partnership, Ceres Alliance L.L.C., CBOT/Eurex Alliance L.L.C.,
Eurex Zurich AG, Eurex Frankfurt AG, Deutsche Borse AG, the Swiss Stock
Exchange, Deutsche Borse Systems AG, members, clearing members, or their agents,
relating to the e-cbot system or any Exchange services or facilities used to
support the e-cbot system, including, but not limited to, warranties of
merchantability and warranties of fitness for a particular purpose or use.
If any of the foregoing limits on the liability of the Exchange (including its
subsidiaries and affiliates), the Clearing House, Ceres Trading Limited
Partnership, Ceres Alliance L.L.C., CBOT/Eurex Alliance L.L.C., Eurex Zurich AG,
Eurex Frankfurt AG, Deutsche Borse AG, the Swiss Stock Exchange, Deutsche Borse
Systems AG, members, clearing members or other persons acting as agents or any
of their officers, directors or employees should be deemed to be invalid,
ineffective, or unenforceable and a third party sustains a loss, damage or cost
(including attorney's fees and court costs) resulting from use of the e-cbot
system, the entire liability of the Exchange (including its subsidiaries and
affiliates), the Clearing House, Ceres Trading Limited Partnership, Ceres
Alliance L.L.C., CBOT/Eurex Alliance L.L.C., Eurex Zurich AG, Eurex Frankfurt
AG, Deutsche Borse AG, the Swiss Stock Exchange, Deutsche Borse Systems AG,
members, clearing members and their agents or any of their officers, directors
or employees shall not exceed the brokerage commissions and any other charges
actually paid by the third party for services in connection with the e-cbot
trading system.
Notwithstanding any of the foregoing provisions, this provision shall in no way
limit the applicability of any provision of the Commodity Exchange Act, as
amended, and Regulations thereunder. (09/01/00)
9B.22 Volatility Quotes - Any options contract and/or combination (i.e., a
transaction including both options and futures contracts), which has been
approved for trading through e-cbot in accordance with Rule 9B.03, may at the
discretion of the Board of Directors trade by means of quoting the implied
volatility for the underlying futures contract, in addition to and simultaneous
with trading the actual premium price of the option. Upon execution of a
transaction in an option or combination quoted in terms of implied volatility,
the quote shall be assigned a price in accordance with a standard option pricing
model approved by the Board.
Implied volatility quotations for options and combinations, whether quoted in
terms of implied volatility or price, shall be deemed an Exchange market
quotation subject to the approval and control of the
e-bot(R)
Exchange. (09/01/00)
9B.23 e-cbot Customer Information Statement - No member or clearing member
shall accept an order from, or on behalf of, a customer for entry into e-cbot,
unless such customer is first provided with an e-cbot Customer Information
Statement in a form approved by the Exchange. (09/01/00)
9B.24 e-cbot Foreign Affiliates - e-cbot access, which a member firm is
eligible to receive, may be obtained from the foreign office of a non-member
foreign affiliate for the entry of such proprietary and customer orders as the
member firm's registration permits, provided: the member firm and its non-member
foreign affiliate shall comply with all the terms and conditions set forth in
Commodity Futures Trading Commission Interpretive Letter 92-11, as modified by
Interpretive Letter 93-83 and any future modifications; that the member firm
shall supervise and be responsible for the non-member foreign affiliate and
guarantee and assume financial responsibilities for each such transaction
effected through e-cbot; and, that each Rule and Regulation of the Exchange
shall apply with equal force and effect to the foreign affiliate and those
transactions entered into e-cbot by the non-member foreign affiliate.
An e-cbot "Foreign Affiliate" shall be defined as a foreign affiliate entity of
a member firm or an entity which is controlled by a parent entity which also
controls the member firm. (09/01/00)
9B.25 Cabinet trades - Notwithstanding any other provision of these rules,
cabinet trades shall not be permitted in futures options contracts on e-cbot.
(09/01/00)
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Chapter 10
Grains
==============================================================================================================
Ch10 Trading Conditions............................................................................
1004.00 Unit of Trading......................................................................
1005.01A Months Traded In.....................................................................
1006.00 Price Basis..........................................................................
1006.01 Price Basis..........................................................................
1007.00 Hours for Trading....................................................................
1007.01 The Opening and Closing of Oats Trading..............................................
1007.02 Modified Closing Call................................................................
1008.01 Trading Limits.......................................................................
1008.01A Trading Limits.......................................................................
1008.02 Trading Limit Corrections............................................................
1009.01 Last Day of Trading of Delivery Month................................................
1009.02 Last Day of Trading [Final Seven Days] of Delivery Month-Corn and Soybeans...........
1010.01 Margins on Futures...................................................................
1012.01 Position Limits......................................................................
Ch10 Delivery Procedures...........................................................................
1035.00 Scope of Chapter.....................................................................
1036.00 Grade Differentials..................................................................
1036.00A Test Weight Designation for Oats.....................................................
1036.00C Soybean Differentials................................................................
1036.01 Location Differentials...............................................................
1038.00 Grades...............................................................................
1038.01 United States Origin Only............................................................
1038.02 Deoxynivalenol (Vomitoxin) Limit in Wheat............................................
1041.00 Delivery Points......................................................................
1041.01 Burns Harbor, Indiana Switching District.............................................
1042.00 Delivery of Commodities by Warehouse Receipts........................................
1042.01 Registration of Grain Warehouse Receipts.............................................
1043.01 Delivery of Corn and Soybeans by Shipping Certificates...............................
1043.02 Registration of Corn and Soybean Shipping Certificates...............................
1043.03 Reissuance of Shipping Certificates..................................................
1044.01 Certificate Format...................................................................
1045.01 Lost or Destroyed Negotiable Warehouse Receipts Shipping Certificate.................
1046.00 Date of Delivery.....................................................................
1046.00A Location for Buying or Selling Delivery Instruments..................................
1047.01 Delivery Notices.....................................................................
1048.01 Method of Delivery...................................................................
1049.00 Time of Delivery, Payment, Form of Delivery Notice...................................
1049.01 Time of Issuance of Delivery Notice..................................................
1049.01B Interpretation: Sellers' Obligation for Storage Charges..............................
1049.02 Buyers' Report of Eligibility to Receive Delivery....................................
1049.03 Sellers' Invoices to Buyers..........................................................
1049.04 Transfer Obligations.................................................................
1050.00 Duties of Members....................................................................
1051.01 Office Deliveries Prohibited.........................................................
1052.00 Delivery of Grain in Cars (Chicago only).............................................
1052.00A Track Deliveries.....................................................................
1052.00B Track Deliveries.....................................................................
1052.00C Track Deliveries.....................................................................
1054.00 Failure to Accept Delivery...........................................................
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1054.00A Failure to Accept Delivery...........................................................
1056.01 Storage Rates, Grain.................................................................
Ch10 Regularity of Warehouses......................................................................
1081.01 Regularity of Warehouses and Issuers of Shipping Certificates........................
1081.01A Inspection...........................................................................
1081.01B Billing When Grain is Loaded Out.....................................................
1081.01C Car of Specified Capacity............................................................
1082.00 Insurance............................................................................
1082.00A Insurance............................................................................
1083.00 Variation Allowed....................................................................
1083.01 Excess or Deficiency in Quantity.....................................................
1084.01 Revocation, Expiration or Withdrawal of Regularity...................................
1085.01 Application for Declaration of Regularity............................................
1086.01 Federal Warehouses...................................................................
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Chapter 10
Grains
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Ch10 Trading Conditions
1004.00 Unit of Trading - On future delivery contracts calling for the
delivery of commodities, delivery shall be made in the following quantities or
multiples thereof:
Wheat, corn, oats and soybeans-5,000 bushels
Other commodities - Units of trading established by these Rules and Regulations
Each delivery of grain may be made up of various lots of grain of the various
authorized grades situated in or for shipment from various eligible warehouses
or shipping stations, provided that no lot delivered shall contain less than
5,000 bushels of any one grade in any one warehouse or shipping station. 290
(03/01/00)
1005.01A Months Traded In - Trading in wheat is regularly conducted in five
different months - March, May, July, September and December but shall be
permitted in the current delivery month plus any succeeding months. The number
of months to be open at one time shall be at the discretion of the Exchange.
Trading in corn and oats is regularly conducted in seven different months-
January, March, May, July, September, November, and December but shall be
permitted in the current delivery month plus any succeeding months. The number
of months to be open at one time shall be at the discretion of the Exchange.
Trading in soybeans is regularly conducted in seven different months - January,
March, May, July, August, September and November but shall be permitted in the
current delivery month plus any succeeding months. The number of months to be
open at one time shall be at the discretion of the Exchange.
Trading in Crude Soybean Oil and Soybean Meal is regularly conducted in eight
different months - January, March, May, July, August, September, October and
December but shall be permitted in the current delivery month plus any
succeeding months. The number of months to be open at any one time shall be at
the discretion of the Exchange. 30R (11/01/99)
1006.00 Price Basis - Future delivery contracts on grain shall be in multiples
as set by the Board by Regulation. (09/01/94)
1006.01 Price Basis -
A. Soybeans. The minimum fluctuation shall be 1/4 cent, including spreads.
B. Corn. The minimum fluctuation shall be 1/4 cent, including spreads.
C. Wheat. The minimum fluctuation shall be 1/4 cent, including spreads.
D. Oats. The minimum fluctuation shall be 1/4 cent, including spreads.
Settlements are to be calculated to the nearest 1/4 cent. 1972 (09/01/94)
1007.00 Hours for Trading - Hours for trading for future delivery in grains,
crude soybean oil and soybean meal shall be from 9:30 a.m. to 1:15 p.m. except
that on the last day of trading in an expiring future the hours with respect to
such futures shall be from 9:30 a.m. to 12 o'clock noon, subject to the
provisions of the next succeeding paragraph of this Rule 1007.00.
On the last day of trading in an expiring future, a bell shall be rung at 12
o'clock noon designating the beginning of the close of the expiring future.
Trading shall be permitted thereafter for a period not to exceed one minute and
quotations made during this time shall constitute the close. The above time
constraints do not apply to options contracts which close by public call.
The hours may be shortened or the Exchange may be closed on any day or days
pursuant to
Ch10 Trading Conditions
-----------------------
Regulation adopted by the Board.
Hours for trading for future delivery in other commodities shall be fixed by
Regulation adopted by the Board.
No such trading shall take place except in the Exchange Hall or on Exchange
facilities including an approved automated order entry facility during such
hours as the Board shall designate. The Association shall conform to Chicago
time. 252 (04/01/97)
1007.01 The Opening and Closing of Oats Trading - Trading for future delivery
in Oats shall be opened and closed with a public call made month by month,
conducted by such persons as the Regulatory Compliance Committee shall direct.
1975 (08/01/96)
1007.02 Modified Closing Call - Immediately following the prescribed closing
procedure for all contracts, there shall be a two (2) minute trading period (the
"modified closing call"). All trades which may occur during regularly prescribed
trading hours may occur during the call at prices within the lesser of the
actual closing range or a range of three (3) official trading increments, i.e.,
one (1) increment above and below the settlement price; at prices within the
lesser of the actual closing range or a range of five (5) official trading
increments, i.e., two (2) increments above and below the settlement price; or at
prices within the lesser of the actual closing range or a range of nine (9)
official trading increments, i.e., four (4) increments above and below the
settlement price, as the Regulatory Compliance Committee shall prescribe; (ii)
no new customer orders may be entered into the call; (iii) cancellations may be
entered into the call; (iv) stop, limit and other resting orders elected by
prices during the close may be executed during the call; (v) individual members
may trade as a principal and/or agent during the call; (vi) individual members
may enter orders for their own accounts into the call; and (vii) member firms,
and those entities which are wholly-owned by member firms or that wholly-own
member firms, trading for such firms' or entities' own proprietary accounts may
initiate trades or enter orders into the call. The proposed settlement price
shall be the midpoint of the closing range unless extenuating circumstances
exist under which the pit committee can justify setting the proposed settlement
price at a price different from the midpoint. If the proposed settlement price
differs from the midpoint of the closing range, then the pit committees are
required to document the basis for the deviation. Such documentation must be
signed by two members of the pit committee.
In accordance with the determination of the Regulatory Compliance Committee,
CBOT contracts shall be traded during the Modified Closing Call as follows:
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Lesser of actual closing Lesser of actual closing
range or three trading increments range or nine trading increments
---------------------------------------------------------------------------------------------
Kilo Gold Futures Corn Futures and Options
---------------------------------------------------------------------------------------------
100 Ounce Gold Futures Wheat Futures and Options
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Silver 1000 Ounce Futures and Options Soybean Futures and Options
---------------------------------------------------------------------------------------------
Silver 5000 Ounce Futures Soybean Oil Futures and Options
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U.S. Treasury Bond Futures and Options Soybean Meal Futures and Options
---------------------------------------------------------------------------------------------
Five Year Note Futures and Options Oat Futures and Options
---------------------------------------------------------------------------------------------
Two Year Note Futures Rough Rice Futures and Options
---------------------------------------------------------------------------------------------
Municipal Bond Index Futures and Options PCS Catastrophe Insurance Options
---------------------------------------------------------------------------------------------
Thirty Day Fed Fund Futures Corn Yield Insurance Futures and Options
---------------------------------------------------------------------------------------------
CBOT Dow Jones Industrial, Transportation,
Utility and Composite Average(SM)
Index Futures and Options
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Ch10 Trading Conditions
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Lesser of actual closing range or five
trading increments
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Ten Year Note Futures and Options
Long Term Agency Note Futures and Options
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(10/01/00)
1008.01 Trading Limits
A. Limits. Trading is prohibited during any Trading Day (as defined in
Regulation 906.04) in futures contracts of commodities traded on this
Exchange at a price or yield higher or lower than either:
1. The settlement price or yield for such commodity on the previous
business day, or
2. The average of the opening range or the first trade during the first
day of trading in a futures contract, or
3. The price or yield established by the Exchange in an inactive future,
plus or minus the following sums with respect to such commodities:
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Corn $.20 per bushel - $1,000
--------------------------------------------------------------------------------------------
Corn Yield Insurance (Iowa, Illinois, 22.5 bushels per acre harvested - $2,250
Indiana, Nebraska, Ohio or U.S.)
--------------------------------------------------------------------------------------------
Kilo Gold $75 per unit of trading - $2,411.25
--------------------------------------------------------------------------------------------
100 Ounce Gold $75 per unit of trading - $7,500
--------------------------------------------------------------------------------------------
Oats $.20 per bushel - $1,000
--------------------------------------------------------------------------------------------
Rough Rice $.50 per hundredweight - $1,000
--------------------------------------------------------------------------------------------
1000 Ounce Silver $1.50 per unit of trading - $1,500
--------------------------------------------------------------------------------------------
5000 Ounce Silver $1.50 per unit of trading - $7,500
--------------------------------------------------------------------------------------------
Soybeans $.50 per bushel - $2,500
--------------------------------------------------------------------------------------------
Soybean Meal $20 per unit of trading - $2,000
--------------------------------------------------------------------------------------------
Soybean Oil (Crude) $.02 per unit of trading - $1,200
--------------------------------------------------------------------------------------------
Wheat $.30 per bushel - $1,500
--------------------------------------------------------------------------------------------
B. Current Month Exclusions. Limits shall not apply to trading in current
month contracts on and after the second business day prior to the first day
of the current month. For Corn Yield Insurance futures, the current month
is the month in which the futures expire for purposes of this regulation.
Notwithstanding the foregoing, limits shall remain in effect for purposes
of trading agricultural contracts on e-cbot.
The provisions of Paragraph B do not apply to CBOT(R) Dow Jones(SM) Index
futures, which will be governed solely by Paragraph D.
C. Limit Bid; Limit Sellers Definitions. The terms "close on the limit bid"
or "close on the limit sellers" are defined as follows:
Limit Bid. Restricted to a situation in which the market closes at an
upward price limit on an unfilled bid. When a close is reported as a range
of different prices, the last price quoted must be limit bid.
Limit Sellers. Restricted to a situation in which the market closes at a
downward price limit on an unfilled offer. When a close is reported as a
range of different prices, the last price quoted must be a limit ask.
D. Daily Price Limits and Trading Halts for CBOT Dow Jones Industrial,
Transportation, Utilities and Composite Average(SM) Index Futures. Daily
price limits and trading halts of the CBOT(R) Dow Jones Industrial
Average(SM) Index, CBOT(R) Dow Jones Transportation Average(SM) Index,
CBOT(R) Dow Jones Utilities Average(SM) Index, and CBOT Dow Jones Composite
Average(SM) Index Futures contracts shall be coordinated with trading halts
of the underlying stocks listed for trading in the primary securities
market.
For purposes of this regulation, the primary futures contract shall be
defined as the futures contract
Ch10 Trading Conditions
-----------------------
trading in the lead month configuration in the pit, or for those contracts
only listed electronically, on the electronic trading system (ETS), and the
Executive Committee or its designee shall have the responsibility of
determining whether the primary futures contract is limit bid or offered.
For the first day of trading in a newly listed contract, there will be an
implied previous business day's settlement price, created by the Exchange
for the sole purpose of establishing price limits. The implied settlement
price will be created by extrapolating the annualized percentage carry
between the two contract months immediately prior to the newly listed
contract.
Price Limits: There shall be three successive price limits for each index,
Level 1, Level 2, and Level 3, below the settlement price of the preceding
regular trading session. Levels 1, 2, and 3 shall be calculated at the
beginning of each calendar quarter, using the average daily closing value
of each index for the calendar month prior to the beginning of the quarter.
Level 1 shall be 10% of such average closing value calculation; Level 2
shall be 20% of such average closing value calculation; Level 3 shall be
30% of such average closing value calculation. For the Dow Jones
Industrial Average(SM), each Level shall be rounded to the nearest fifty
points. For the Dow Jones Transportation Average(SM) and the Dow Jones
Composite Average(SM), each Level shall be rounded to the nearest ten
points. For the Dow Jones Utilities Average(SM), each Level shall be
rounded to the nearest point. The values of Levels 1, 2 and 3 shall remain
in effect until the next calculation.
Price Limits and Trading Halts When the U.S. Primary Securities Market is
Open for Regular Trading Hours: The following price limits and trading
halts shall apply when the primary securities market in the United States
underlying the DJIA(sm) is open for regular trading hours.
(a) Level 1:
Except as provided below, the Level 1 price limit shall be in effect until
a trading halt has been declared in the primary securities market, trading
in the primary securities market has resumed, and fifty percent (50%) of
the stocks underlying the DJIA(SM) Index (selected according to
capitalization weights) have reopened. The Level 2 price limit shall apply
to such reopening.
Until 1:00 p.m. Chicago time (2:00 p.m. Eastern time), the trading halt
shall be a one-hour trading halt. Between 1:00 p.m. and 1:30 p.m. Chicago
time (2:00 p.m. and 2:30 p.m. Eastern time), the trading halt shall be a
one-half hour trading halt.
The Level 1 price limit shall not apply after 1:30 p.m. Chicago time (2:30
p.m. Eastern time). If the futures contract is limit offered at the Level
1 price limit and a trading halt has not been declared in the primary
securities market, the Level 1 price limit shall be lifted and the Level 2
price limit shall apply thereafter.
(b) Level 2:
Except as provided below, the Level 2 price limit shall be in effect until
a trading halt has been declared in the primary securities market, trading
in the primary securities market has resumed, and fifty percent (50%) of
the stocks underlying the DJIA(SM) Index (selected according to
capitalization weights) have reopened. The Level 3 price limit shall apply
to such reopening.
Until 12:00 noon Chicago time (1:00 p.m. Eastern time), the trading halt
shall be a two-hour trading halt. Between 12:00 noon and 1:00 p.m. Chicago
time (1:00 p.m. and 2:00 p.m. Eastern time), the trading halt shall be a
one-hour trading halt. After 1:00 p.m. Chicago time (2:00 p.m. Eastern
time), the trading halt declared in the primary securities market will
remain in place for the rest of the primary securities market trading day.
(c) Level 3:
The Level 3 price limit shall be in effect during the entire regular
daytime trading session.
Trading Halts: If the primary futures contract for the DJIA(sm) is limit
offered at either the Level 1 or Level 2 price limit as described above and
there is a trading halt declared in the primary securities market, trading
shall be halted for all Dow Jones(sm) Index futures contracts that have
reached their respective price limits. In the event that trading in the
primary securities market resumes after a trading halt, trading in each of
the Dow Jones(SM) Index futures contracts (that have halted) shall resume
only after fifty percent (50%) of the stocks underlying the DJIA(SM) Index
(selected according to capitalization weights) have reopened. The next
applicable price limit enumerated above shall apply to the reopening
indexes and to those indexes that had not reached their previous respective
price limits during the period of the halt.
Ch10 Trading Conditions
-----------------------
If after 1:00 p.m. Chicago time (2:00 p.m. Eastern time), the primary
futures contract for the DJIA(sm) is limit offered at the Level 2 price
limit, or if the primary futures contract for the DJIA(sm) is limit offered
at the Level 3 price limit at any time during the trading day, and the
primary securities market declares a trading halt for the rest of its
trading day, the Exchange will also declare a trading halt for the rest of
its trading day for all Dow Jones(sm) Index futures contracts that have
reached their respective price limits.
If the primary futures contract for the DJIA(sm) trades at the Level 1, 2,
or 3 price limits described above during that portion of the e-cbot trading
session when the primary securities market is open for regular trading
hours, trading will be halted for all Dow Jones(sm) futures contracts that
have reached their respective price limits. In the event that e-cbot trades
occur through the price limits described above, any such trades may be
busted with the approval of the Exchange.
Price Limits When the U.S. Primary Securities Market is Not Open for
Regular Trading Hours: When the primary securities market is not open for
regular trading hours, there shall be a price limit of 10% of the average
daily closing value of each index for the calendar month prior to the
beginning of the quarter. The value of this limit shall remain in effect
until the next calculation. This price limit shall apply above or below
the previous trading day's settlement price. (09/01/00)
1008.01A Trading Limits - The Crude Soybean Oil and Soybean Meal Committee has
been asked to interpret the following sentence:
"These provisions (trading limits) shall not apply to trading in the current
month on or after the first notice day thereof."
The question that arises is whether this means the first business day of the
delivery month or the first notice day of the contract which would be the last
business day of the previous month.
The Committee is of the opinion that it is the intention of the Regulations that
the meaning of the sentence includes the first notice day which is the last
business day of the month preceding the delivery month. 36R (09/01/94)
1008.02 Trading Limit Corrections - Daily trading limits determined pursuant
to Regulation 1008.01A (1) may be corrected as specified in this regulation only
in cases where the applicable settlement price is related to an erroneous
closing price quotation.
Such a correction may be made:
- only to the level which would have been specified had the error not occurred;
and
- only if the error is identified prior to the next day's opening of trading.
Such a correction may be adopted by approvals of the relevant Pit Committee
Chairman, or the Pit Committee Vice Chairman in the absence of the Pit Committee
Chairman, and the Chairman or Vice Chairman of the Regulatory Compliance
Committee within 15 minutes after the closing of the applicable futures contract
or within 30 minutes after the closing of the applicable futures option
contract. Thereafter, such a correction may be adopted by approval of the
Regulatory Compliance Committee.
No such correction may be made after the next day's opening of trading.
(09/01/94)
1009.01 Last Day of Trading of Delivery Month - Wheat and Oats - No trades in
wheat or oat futures deliverable in the current month shall be made after the
business day preceding the 15th calendar day of that month. Any contracts
remaining open after the last day of trading must be either:
(a) Settled by delivery no later than the seventh business day following
the last trading day.
(b) Liquidated by means for a bona fide exchange of futures for the actual
cash commodity, no later than the sixth business day following the
last trading day. (03/01/00)
1009.02 Last Day of Trading of Delivery Month-Corn and Soybeans - No trades in
corn and soybean futures deliverable in the current month shall be made after
the business day preceding the 15th calendar day of that month. Any contracts
remaining open after the last day of trading must be either:
Ch 10 Trading Conditions
------------------------
(a) Settled by delivery no later than the second business day following the
last trading day (tender on business day prior to delivery).
(b) Liquidated by means of a bona fide exchange of futures for the actual
cash commodity, no later than the business day following the last trading day.
1832a (03/01/00)
1010.01 Margins on Futures - (See 431.03) (09/01/94)
1012.01 Position Limits - (See 425.01) (09/01/94)
Ch10 Delivery Procedures
1035.00 Scope of Chapter - Commodities bought or sold for future delivery
under Exchange contracts shall be delivered and accepted in accordance with the
provisions of this Chapter. Any Regulation or Ruling which is inconsistent with
the requirements or procedures set forth in this Chapter 10 is hereby superseded
by the Chapter to the extent of such inconsistency. 280 (09/01/94)
1036.00 Grade_Differentials - Unless otherwise specified, contracts for the
sale of wheat, corn, soybeans and oats shall be deemed to call for "contract"
wheat, corn, soybeans and oats respectively. Upon such contracts, sellers, at
their option, may deliver all or part of the following grades at the following
price differentials, provided that lots of grain of any one grade must conform
to the minimum lot requirements of Rule 1004.00:
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WHEAT GRADE DIFFERENTIALS
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At 3c Premium At Contract Price
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No. 1 Soft Red Winter No. 2 Soft Red Winter
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No. 1 Hard Red Winter No. 2 Hard Red Winter
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No. 1 Dark Northern Spring No. 2 Dark Northern Spring
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No. 1 Northern Spring No. 2 Northern Spring
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Wheat which contains moisture in excess of 13.5% is not deliverable.
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CORN DIFFERENTIALS
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No. 1 Yellow Corn (maximum 15% moisture) at 1 1/2 cents per bushel over contract
price.
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No. 2 Yellow Corn (maximum 15% moisture) at contract price.
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No. 3 Yellow Corn (maximum 15% moisture) at 1 1/2 cents per bushel under
contract price.
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SOYBEAN GRADE DIFFERENTIALS
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U.S. No. 1 Yellow Soybeans (maximum 13% at 6 cents per bushel over contract price.
moisture)
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U.S. No. 2 Yellow Soybeans (maximum 14% at contract price.
moisture)
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*U.S. No. 3 Yellow Soybeans (maximum at 6 cents per bushel under contract price.
14% moisture)
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* All factors equal to U.S. No. 2 grade or better (including test weight;
splits; heat damage; brown, black and/or bicolored soybeans in yellow
soybeans) except foreign material (maximum 3%).
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OATS GRADE DIFFERENTIALS
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No. 1 Extra Heavy Oats At 7 cents per bushel over contract price.
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No. 2 Extra Heavy Oats At 4 cents per bushel over contract price.
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No. 1 Heavy Oats At 3 cents per bushel over contract price.
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No. 2 Heavy Oats At contract price.
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No. 1 Oats At contract price.
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No. 2 Oats (36 Ib. minimum test weight) At 3 cents per bushel under contract price.
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No. 2 Oats (34 Ib. minimum test weight) At 6 cents per bushel under contract price.
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Bright Oats shall carry no additional premium or discount. Oats with more than
14% moisture are not deliverable. (03/01/00)
1036.00A Test Weight Designation for Oats - The Rules Committee has determined
that, in the future, warehouse receipts of No. 2 Oats should carry the test
weight designation on the face of the receipt. In connection with warehouse
receipts currently outstanding which do not contain any such designation, it was
determined that unless the designation "36 Ib. minimum test weight" appears on
the face of the receipt, that the grade is considered to be 34 Ib. minimum test
weight (6 cents per bushel under contract price). In consideration of any holder
of outstanding Oat receipts that for some reason are "36 Ib. minimum test
weight" and the receipt fails to reflect such, the holder can contact the
Registrar's Office for updating the receipt. (09/01/94)
1036.00C Soybean Differentials - The Board has determined that in accordance
with Rule 1036.00, No. 1 Yellow Soybeans which contain moisture in excess of 13%
but not more than 14% are deliverable at par. (09/01/94)
1036.01 Location Differentials - Unless otherwise specified, contracts for
the sale of wheat, corn, soybeans and oats shall be deemed to call for
"contract" wheat, corn, soybeans and oats respectively. Upon such contracts,
sellers, at their option, may deliver all or part at the following locations at
the following price differentials, subject to the differentials for grade
outlined in Rule 1036.00, provided that lots of grain of any one grade must
conform to the minimum lot requirements of Rule 1004.00:
WHEAT LOCATION DIFFERENTIALS
In accordance with the provisions of Rule 1041.00C, wheat in regular warehouses
located within the Chicago Switching District, the Burns Harbor, Indiana
Switching District or the Toledo, Ohio Switching District may be delivered in
satisfaction of Wheat futures contracts at contract price, subject to the
differentials for class and grade outlined above. Only No. 1 Soft Red Winter and
No. 2 Soft Red Winter Wheat in regular warehouses located within the St. Louis-
East St. Louis and Alton Switching districts may be delivered in satisfaction of
Wheat futures contracts at a premium of 10 cents per bushel over contract price,
subject to the differentials for class and grade outlined above.
CORN LOCATION DIFFERENTIALS
In accordance with the provisions of Rule 1041.00A, corn for shipment from
regular warehouses located within the Chicago Switching District or the Burns
Harbor, Indiana Switching District may be delivered in satisfaction of Corn
futures contracts at contract price, subject to the differentials for class and
grade outlined above. Corn in regular warehouses located within the Toledo,
Ohio Switching District may be delivered in satisfaction of Corn futures
contracts at a discount of 3c per bushel under contract price, subject to the
differentials for class and grade outlined above. Corn in regular warehouses
located within the St. Louis-East St. Louis and Alton switching districts may be
delivered in satisfaction of Corn futures contracts at a premium of 7 cents per
bushel over contract price, subject to the differentials for class and grade
outlined above.
See Regulation 10C36.01-Location Differentials for March 2000 and subsequent
Corn futures contracts.
SOYBEAN LOCATION DIFFERENTIALS
In accordance with the provisions of Rule 1041.00D, soybeans for shipment from
regular warehouses located within the Chicago Switching District or the Burns
Harbor, Indiana Switching District may be delivered in satisfaction of Soybean
futures contracts at contract price, subject to the differentials for class and
grade outlined above. Soybeans in regular warehouses located within the Toledo,
Ohio Switching District may be delivered in satisfaction of Soybean futures
contracts at a discount of 8c per bushel under contract price, subject to the
differentials for class and grade outlined above. Soybeans in regular
warehouses located within the St. Louis-East St. Louis and Alton switching
districts may be delivered in satisfaction of Soybean futures contracts at a
premium of 8 cents per bushel over contract price, subject to the differentials
for class and grade outlined above.
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See Regulation 10S36.01-Location Differentials for January 2000 and subsequent
Soybean futures contracts.
OATS LOCATION DIFFERENTIALS
In accordance with the provisions of Rule 1041.00B, oats in regular warehouses
located within the Chicago Switching District, [or] the Burns Harbor, Indiana
Switching District, [may be delivered in satisfaction of Oats futures contracts
at contract price, subject to the differentials for grade outlined above. Oats
in regular warehouses located within] the Minneapolis, Minnesota Switching
District, or the St. Paul, Minnesota Switching District[s] may be delivered in
satisfaction of Oats futures contracts at [a discount of 7 1/2c per bushel
under] contract price, subject to the differentials for class and grade outlined
above.
Additions underlined, deletions bracketed for July 2000 and subsequent Oat
months. (03/01/00)
1038.00 Grades - A contract for the sale of commodities for future delivery
shall be performed on the basis of the grades officially promulgated by the
Secretary of Agriculture as conforming to United States Standards at the time of
making the contract. If no such United States grades shall have been officially
promulgated, then such contract shall be performed on the basis of the grades
established by the Department of Agriculture of the State of Illinois, or the
standards established by the Rules and Regulations of the Association in force
at the time of making the contract. 293 (09/01/94)
1038.01 United States Origin Only - Effective September 1, 1992, a futures
contract for the sale of corn, soybeans or wheat shall be performed on the basis
of United States origin only upon written request by a taker of delivery at the
time loading orders are submitted. (09/01/94)
1038.02 Deoxynivalenol (Vomitoxin) Limit in Wheat - Effective September 1,
1999, a taker of delivery of wheat shall have the option to request in writing
load-out of wheat which contains no more than 5 (five) parts per million of
deoxynivalenol (vomitoxin). At the taker's expense, a determination of the level
of vomitoxin shall be made at the point of load-out by the Federal Grain
Inspection Service or by a third party inspection service which is mutually
agreeable to the maker and taker of delivery. (12/01/98)
1041.00 Delivery Points -
A. Corn. Corn in regular warehouses located with the Chicago Switching
District, the Burns Harbor, Indiana Switching District, the Toledo, Ohio
Switching District or the St. Louis-East St. Louis and Alton Switching
Districts may be delivered in satisfaction of corn futures contracts.
See Rule 10C41.00-Delivery Points for March 2000 and subsequent Corn
futures contracts.
B. Oats. Oats in regular warehouses located within the Chicago Switching
District, the Burns Harbor, Indiana Switching District or the Minneapolis,
Minnesota or St. Paul, Minnesota Switching Districts may be delivered in
satisfaction of oats futures contracts.
C. Wheat. Wheat in regular warehouses located within the Chicago Switching
District, the Burns Harbor, Indiana Switching District or the Toledo, Ohio
Switching District may be delivered in satisfaction of wheat futures
contracts. Only No. 1 Soft Red Winter and No. 2 Soft Red Winter Wheat in
regular warehouses located within the St. Louis-East St. Louis and Alton
Switching Districts may be delivered in satisfaction of Wheat futures.
D. Soybeans. Soybeans in regular warehouses located within the Chicago
Switching District, the Burns Harbor, Indiana Switching District, the
Toledo, Ohio Switching District or the St. Louis-East St. Louis Alton
Switching Districts may be delivered in satisfaction of soybean futures
contracts.
See Rule 10S41.00-Delivery Points for January 2000 and subsequent Soybean
futures contracts. (03/01/00)
1041.01 Burns Harbor, Indiana Switching District - When used in these Rules and
Regulations, the Burns Harbor, Indiana Switching District will be that area
geographically defined by the boundaries of Burns Waterway Harbor at Burns
Harbor, Indiana which is owned and operated by the Indiana Port Commission.
(09/01/94)
1042.00 Delivery of Commodities by Warehouse Receipts - Except as otherwise
provided,
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delivery of commodities shall be made by the delivery of registered warehouse
receipts issued by warehousemen against stocks in warehouses which have been
declared regular by the Regulatory Compliance Committee. The Regulatory
Compliance Committee by Regulation may prescribe the conditions upon which
warehouses and warehousemen may become regular except that in the case of
federally licensed warehouses and warehousemen, the Regulatory Compliance
Committee may impose only such reasonable requirements as to location,
accessibility and suitability as may be imposed on other regular warehouses and
warehousemen.
The Regulatory Compliance Committee by Regulation may prescribe conditions not
inconsistent with the provisions of this Chapter upon which warehouse receipts
issued by regular warehouses shall be deliverable. 281 (02/01/99)
1042.01 Registration of Grain Warehouse Receipts - In order to be valid for
delivery against futures contracts, grain warehouse receipts must be registered
with the official Registrar appointed by the Board and in accordance with the
requirements issued by the Registrar. Except in the case of delivery on the last
delivery day of a delivery month, in which case the warehouse receipt must be
registered before 1:00 p.m. on the last delivery day of the delivery month, the
grain warehouse receipt must be registered before 4:00 p.m. on notice day, the
business day prior to the day of delivery. If notice day is the last business
day of a week, grain warehouse receipts must be registered before 3:00 p.m. on
that day. (03/01/00)
1043.01 Delivery of Corn and Soybeans by Shipping Certificates - Deliveries
of Corn and Soybeans shall be made by delivery of Shipping Certificates issued
by Shippers designated by the Exchange as regular to issue Shipping Certificates
for Corn and Soybeans. In order to effect a valid delivery each Shipping
certificate must be endorsed by the holder making the delivery. Such endorsement
shall constitute a warranty of the genuineness of the Certificate and of good
title thereto, but shall not constitute a guaranty, by an endorser, of
performance by the issuer of the Certificate. (03/01/00)
1043.02 Registration of Corn and Soybean Shipping Certificates - Corn and
Soybean Shipping Certificates in order to be eligible for delivery must be
registered with the Official Registrar and in accordance with the requirements
issued by the Registrar, must not be more than six months old and must not have
an expiration date in the month in which they are delivered. Registration of
Corn and Soybean Shipping Certificates shall also be subject to the following
requirements:
(a) Shippers who are regular for delivery may register certificates at any
time. The holder of a registered certificate may cancel its registration at
any time. A certificate which has been canceled may not be registered
again.
(b) No notice of intention to deliver a certificate shall be tendered to the
Clearing House unless said certificate is registered and in possession of
the Clearing House member tendering the notice or unless a shipping
certificate is registered and outstanding.
(c) When a notice of intention to deliver a certificate has been tendered to
the Clearing House, said certificate shall be considered to be
"outstanding" until its registration is canceled. The member issuing such
notice shall transmit to the Registrar, at the same time the notice is
tendered to the Clearing House, the certificate number and the name of the
registered shipper. From this information and his own records of
registration and of cancellations of outstanding certificates, the
Registrar shall maintain a current record of the number of certificates
that are outstanding and shall be responsible for posting this record on
the Exchange Floor.
(d) When a registered shipper regains control of an outstanding certificate
calling for shipment from one of his shipping stations, which in any manner
relieves him of the obligation to ship corn or soybeans upon demand of a
party other than himself, the shipper shall cancel the registration of said
certificate by noon of the next business day except in the case where a
notice of intention to redeliver said certificate for the shipper has been
tendered to the Clearing House by 4:00 p.m. of the day that the shipper
regained control of said certificate.
(e) The Registrar shall not divulge any information concerning the
registration, delivery or cancellation of certificates other than the
record posted on the Exchange Floor, except that he shall issue a
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weekly report showing the total number of certificates outstanding as of
4:00 P.M. on the last trading day of each week. In addition to the
information posted on the Exchange Floor, this weekly report will show the
names of shippers whose certificates are outstanding and the location of
the shipping stations involved. (03/01/00)
1043.03 Reissuance of Shipping Certificates - Every Corn and Soybean Shipping
Certificate must be returned to the shipper, or his agent, for reissuance prior
to its becoming six months old. At such time accrued premium charges shall be
paid and the Shipper shall be obligated to provide the owner with a new and duly
registered Corn or Soybean Shipping Certificate.
Every Corn and Soybean Shipping Certificate which is not returned to the
shipper, or his agent, for reissuance prior to its becoming six months old, will
be subject to the late charge which will be paid to the shipper by the owner on
the day that the accrued premium charges are paid. The late charge will be an
amount equal to the total unpaid accumulated premium charges multiplied by the
"prime interest rate" in effect on the day that the accrued premium charges are
paid multiplied by the number of calendar days that the certificate is past due,
divided by 360 days. The term "prime interest rate" shall mean the lowest of the
rates announced by each of the following four banks at Chicago, Illinois as its
"prime rate": Bank of America-Illinois, The First National Bank of Chicago,
Harris Trust and Savings Bank and the Northern Trust Company. The number of
calendar days that the certificate is past due shall be the number of days
beginning with the day that the shipping certificate is six months old and
continuing through the business day that the certificate is returned to the
shipper or his agent. (03/01/00)
1044.01 Certificate Format - See Regulation 10C44.01-Certificate Format for
March 2000 and subsequent Corn futures contracts and Regulation 10S44.01-
Certificate Format for January 2000 and subsequent Soybean futures contracts.
(03/01/00)
1045.01 Lost or Destroyed Negotiable Warehouse Receipts Shipping Certificate
(a) Unless a federal or state law prescribes different procedures to be
followed in the case of lost or destroyed warehouse receipts or shipping
certificates, the following procedures shall be followed. A replacement
receipt/certificate may be issued upon compliance with the conditions set
forth in paragraph (b) of this Regulation. Such replacement
receipt/certificate must be issued upon the same terms, must be subject to
the same conditions, and must bear on its face the number and the date of
the receipt/certificate in lieu of which it is issued. It must also contain
a plain and conspicuous statement that it is a replacement
receipt/certificate issued in lieu of a lost or destroyed
receipt/certificate.
(b) Before issuing such replacement receipt/certificate, the
warehouseman/shipper may require the person requesting the
receipt/certificate to make and file with the warehouseman/shipper: (1) an
affidavit stating that the requestor is the lawful owner of the original
receipt/certificate, that the requestor has not negotiated, sold, assigned
or encumbered it, how the original receipt/certificate was lost or
destroyed, and if lost, that diligent effort has been made to find the
receipt/certificate without success, and (2) a bond in an amount double the
value, at the time the bond is given, of the commodity represented by the
lost or destroyed receipt/certificate.
Such bond shall indemnify the warehouseman/shipper against any loss
sustained by reason of the issuance of such replacement
receipt/certificate. The bond shall have as surety thereon a surety company
which is authorized to do business, and is subject to service of process in
a suit on the bond, in the state in which the warehouse/shipping station,
as named on the warehouse receipt/certificate, is located, or at least two
individuals who are residents of such state, and each of whom owns real
property in that state having a value, in excess of all exemptions and
encumbrances, equal to the amount of the bond.
In the alternative, upon the approval of the U.S. Department of Agriculture
where applicable, or otherwise upon the approval of the Exchange, a
warehouseman/shipper may issue a replacement receipt/certificate upon the
execution of an agreement by the requestor to indemnify the
warehouseman/shipper against any loss sustained by reason of the issuance
of
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such replacement receipt/certificate, in a form acceptable to the
warehouseman/shipper. (04/01/00)
1046.00 Date of Delivery - Where any commodity is sold for delivery in a
specified month, delivery of such commodity may be made by the seller upon such
business day of the specified month as the seller may select and, if not
previously delivered, delivery must be made upon the last business day of the
specified month; provided, however, that the Exchange may, by Regulation
pertaining to a particular commodity, prescribe specific days or dates within
such specified month on which delivery of such commodity may or may not be made.
284 (09/01/94)
1046.00A Location for Buying or Selling Delivery Instruments - In order to
facilitate liquidation of outstanding contracts during the final seven business
days of a delivery month (Regulation 1009.03) floor brokers, locals and clearing
or non-clearing members who need warehouse receipts or shipping certificates in
order to make delivery or who anticipate receiving warehouse receipts or
shipping certificates on delivery and wish to dispose of them may meet at 2:00
p.m. on the last day of trading in an expiring future at the cash grain table
between the corn and soybean pits to make arrangements for the acquisition or
disposition of such receipts or certificates.
All actual deliveries against outstanding futures positions must, in any event,
be made by sellers through the Clearing House and will be received by buyers
through the Clearing House. 34R (09/01/94)
1047.01 Delivery Notices - A seller obligated or desiring to make delivery of
a commodity shall issue and deliver to the Clearing House a delivery notice
containing the name and business address of the issuer; the date of issue; the
date of delivery; the name of the commodity; the total contracted quantity in
satisfaction of which the delivery is being tendered and such other information
as the Regulatory Compliance Committee shall direct in regard to any particular
commodity.
A delivery notice shall be furnished to the Clearing House in computer readable
form. The Clearing House, acting as agent for the seller, shall provide the
notice to the buyer.
The seller or its agent shall reduce the notice to written form and retain a
copy of the notice for the period of time required by the Commodity Futures
Commission.
Upon determining the buyers obligated to accept deliveries tendered by issuers
of delivery notices, the Clearing House shall promptly furnish to each issuer
the names of the buyers obligated to accept delivery from him for each commodity
for which a notice was tendered and shall also inform the issuer of the number
of contracts for which each buyer is obligated. Failure of the seller to object
to such assignment by 7:00 a.m. on intention day shall establish an irrebuttable
presumption that the issuance of the delivery notice was authorized by the
person in whose name the notice was issued. (09/01/94)
1048.01 Method of Delivery - Delivery notices must be delivered to the
Clearing House which shall assign the deliveries to clearing members (buyers)
having contracts to take delivery of the same amounts of the same commodities.
The Clearing House shall notify such clearing members of the deliveries which
have been assigned to them and shall furnish to issuers of delivery notices the
names of clearing members obligated to accept their deliveries. Clearing Members
receiving delivery notices shall assign delivery to the oldest open contracts on
their books at the close of business on the previous day (position day). 286
(09/01/94)
1049.00 Time of Delivery, Payment, Form of Delivery Notice - The requirements
of the form of delivery notice, time of delivery, and payment shall be fixed by
the Regulatory Compliance Committee. 287 (09/01/94)
1049.01 Time of Issuance of Delivery Notice - Unless a different time is
prescribed by Regulation pertaining to a particular commodity, delivery notices
must be delivered to the Clearing House by 4:00 p.m., or by such other time
designated by the Board of Directors, on position day except that, on the last
notice day of the delivery month, delivery notices may be delivered to the
Clearing House until 2:00 p.m., or by such other time designated by the Board of
Directors, on intention day. The Clearing House shall, on the same day, assign
the deliveries to eligible buyers as provided in Regulation 1048.01 and shall
issue to each such buyer a delivery assignment notice describing the delivery
which has been assigned to him. (12/01/99)
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1049.01B Interpretation: Sellers' Obligation for Storage Charges - The
Directors have issued the following interpretation of Rule 1042.00, Rule
1041.00, and Regulation 1049.01 in connection with the time the responsibility
for storage charges changes from seller to buyer.
The responsibility for storage charges shall remain the obligation of the seller
until such time as the warehouse receipts or weight certificates are presented
to the buyer and payment is made therefore in conformity with the Regulations
concerning payment. (09/01/94)
1049.02 Buyers' Report of Eligibility to Receive Delivery - Prior to 8:00
p.m., or by such other time designated by the Board of Directors, of each day on
which delivery notices may be delivered to the Clearing House, each clearing
member shall report to the Clearing House, at such times and in such manner as
shall be prescribed by the Clearing House, the amounts of its purchases of the
various commodities then eligible for delivery which remain open on its books in
accordance with law and with the Rules and Regulations of the Association. Such
reports shall show the dates on which such purchases were made, and shall
exclude purchases to which the clearing member has applied deliveries assigned
to it but which remain open on its books pending receipt of delivery. With
respect to omnibus accounts, the reports described above shall show the dates on
which such purchases were made, as reflected on the ultimate customers' account
statements. (12/01/99)
1049.03 Sellers' Invoices to Buyers - Upon receipt of the names of the buyers
obligated to accept delivery from him and a description of each commodity
tendered by him which was assigned by the Clearing House to each such buyer, the
seller shall prepare invoices addressed to its assigned buyers describing the
documents to be delivered to each such buyer and, in the case of deliveries
under Rule 1041.00, the information required in said Rule. Such invoices shall
show the amount which buyers must pay to sellers in settlement of the actual
deliveries, based on the delivery prices established by the Clearing House for
that purpose adjusted for applicable premiums, discounts, storage charges,
premium charges, premium for FOB conveyance, quantity variations and other items
for which provision is made in these Rules and Regulations relating to
contracts, and shall be in the form set forth hereunder unless a different form
is prescribed by Regulation pertaining to a particular commodity. Such invoices
shall be delivered to the Clearing House by 4:00 p.m., or by such other time
designated by the Board of Directors, on the day of intention except on the last
notice day in the delivery month when a skeleton notice has been delivered to
the Clearing House, in which case invoices for said delivery may be delivered to
the Clearing House until 10:00 a.m. on the last delivery day of the delivery
month. Upon receipt of such invoices, the Clearing House shall promptly make
them available to buyers to whom they are addressed, by placing them in buyers'
mail boxes provided for that purpose in the Clearing House.
Financial instruments futures contracts will follow the invoicing procedure that
is prescribed in the respective contract's invoicing regulation. Delivery
invoicing forms for financial instruments futures contracts shall be restricted
to that form which the Board of Trade Clearing Corporation specifically
provides.
DELIVERY INVOICE
Office Of
No._______
_________________________________________________________________________
_________________________________________________________________________
For delivery on__________________________________________________________
(Date)
against C. H. Assignment Notice No.______________________________________
To_______________________________________________________________________
(Buyer's code number and name)
For the delivery of______________________________________________________
(Net quantity, per list total below)
of_______________________________________________________________________
(Grade, class, commodity)
In, ordered to, or to be shipped from____________________________________
(Warehouse, delivery or shipping point)
As evidenced by the documents listed below:
At the established delivery price of__________ per_________ $________
Premium or discount on grade ________
Storage and insurance, or premium, for a total of__________days ________
Other charges or credits ________
TOTAL AMOUNT DUE-THIS INVOICE $
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Date Number Quantity Rate Amount Pd.thru Days Rate Amount Dr Cr. Description
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1638 (03/01/00)
1049.04 Transfer Obligations - Payment is to be made in same day funds 1) by a
check drawn on and certified by a Chicago bank or 2) by a Cashier's check issued
by a Chicago bank. The long clearing member may effect payment by wire transfer
only if this method of payment is acceptable to the short clearing member.
Unless a different time is prescribed by Regulation pertaining to a particular
commodity, buyers obligated to accept delivery must take delivery and make
payment and sellers obligated to make delivery must make delivery before 1:00
p.m. of the day of delivery, except on banking holidays when delivery must be
taken or made and payment made before 9:30 a.m. the next banking business day.
Adjustments for differences between contract prices and delivery prices
established by the Clearing House shall be made with the Clearing House in
according with its By-Laws and Resolutions. 1639 (05/01/97)
1050.00 Duties of Members - Members shall deliver warehouse receipts, bills of
lading, shipping certificates or demand certificates tendered for delivery
pursuant to the Rules and Regulations of the Association and in accordance with
the assignment thereof to eligible buyers by the Clearing House, and shall make
no other disposition thereof. A member who alters or makes a false endorsement
on a notice of assignment of delivery issued by the Clearing House under Rule
1048.00, for the purpose of avoiding acceptance of the delivery specified,
therein, should be deemed guilty of an act detrimental to the Welfare of the
Association. 288 (09/01/94)
1051.01 Office Deliveries Prohibited - No office deliveries of warehouse
receipts or shipping certificates may be made by members of the Clearing
Corporation. Where a commission house as a member of the Clearing Corporation
has an interest both long and short for customers on its own books, it must
tender to the Clearing Corporation such notices of intention to deliver as it
receives from its customers who are short. 1870 (03/01/00)
1052.00 Delivery of Grain in Cars (Chicago only) - Regular deliveries of
contract grades of grain on contracts for future delivery may be made in cars on
track during the last three business days in the delivery month subject to the
following:
(a) Cars must be within the Chicago District, in a railroad yard where samples
are taken by an official grain inspection agency approved by the U.S.D.A.
(b) Cars must be consigned or ordered to a regular warehouse.
(c) Delivery shall not be complete until the grain is unloaded and warehouse
receipts or weight certificates are issued therefor unless the buyer elects
otherwise. During this time, title to the grain remains in the seller, the
purchase price is not payable, and the seller remains liable for any change
in grade. The buyer, however, may elect and order the cars unloaded at any
other place where they will be weighed provided the buyer makes payment in
advance. In making such election and paying in advance the buyer assumes
title and all responsibility for any change in grade occuring after the
original inspection as provided in subsection (d) of this Rule and for any
and all charges occasioned by such election of the buyer.
(d) Grain delivered in cars on track in settlement of futures contracts must be
inspected during the last four delivery days of the delivery month by an
official grain inspection agency approved by the U.S.D.A. In the event
another grade determination is made subsequent to date of tender and the
original grade is changed, the delivery will not be disqualified as a result
thereof. Price adjustment will be made between the buyer and the seller at
the prevailing fair market difference based on the cost of replacement. In
the event of a dispute, the Chairman of the Regulatory Compliance Committee
will appoint an impartial committee of three to fix a fair and proper
differential.
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(e) Deliveries of grain in cars shall be made by the tender of delivery notices
based on the shippers' certificates of weight (if attached thereto) or
railroad weights, or, in the absence of such weights, the marked capacity of
the cars.
(f) Where there is an excess or deficit upon delivery, such excess or deficit
shall be settled for on the basis of the market price at the time when such
excess or deficit becomes known to both parties; provided that the buyer, if
he so elects, may cancel the contract as to any deficit.
(g) On all grain tendered under this Rule, the party making the original tender
shall keep on file and deliver on request, at tenderer's option, the samples
of the official grain inspection agency.
(h) Delivery of wheat, corn, oats or soybeans in cars shall be for quantities
of 5,000 bushels or multiples thereof. 283 (03/01/00)
1052.00A Track Deliveries -
1. Under subparagraph (d) of Rule 1052.00 when notices of intention to deliver
are issued on the day prior to the three days during which regular
deliveries may be made in carlots, the requirement that the delivery notice
be accompanied by certificate showing approval by the Illinois State Grain
Inspection Department for storage must be attached to the delivery notice
will be satisfied if that certificate is furnished the next day.
2. During the last three delivery days of the month split notices of delivery
may be tendered, that is to say, part of the notice may cover grain in store
and part of the notice may cover grain in cars on track. 14R (03/01/00)
1052.00B Track Deliveries - The matter of the origin of grain which may be
delivered in satisfaction of futures contracts under Rule 1052.00 (Delivery of
Grain in Cars), was brought before the Directors. After a discussion upon motion
duly made, seconded, and unanimously carried, it was
Resolved, only grain arriving in cars from points outside of the Chicago
Switching District and which has not previously been unloaded at a warehouse in
the Chicago Switching District may be delivered in satisfaction of futures
contracts under Rule 1052.00; and
Further Resolved, that grain loaded in cars from warehouses in the Chicago
Switching District shall not be deliverable in satisfaction of futures contracts
under said Rule 1052.00. 23R (09/01/94)
1052.00C Track Deliveries -
1. The question was submitted to the Directors as to whether or not under Rule
1052.00 (Delivery of Grain in Cars) out-of-town weights can be used on
carlot deliveries provided there is an agreement between the buyer and
seller. It was the ruling of the Directors and the Rules Committee that
under the provisions of this Rule out-of-town weights may not be used even
where mutual agreement might exist.
2. The question was submitted to the Directors as to whether deliveries of
grain in cars might be settled on the aggregate or on the basis of
individual contracts under Rule 1052.00.
The Directors and the Rules Committee held that the settlement must be made
on the individual contracts of 5,000, 2,000, 1,000 bushels or multiples
thereof, and may not be settled on the aggregate.
3. The Directors and the Rules Committee have made the following interpretation
of Regulation 1047.01 (Delivery Notice). A person issuing a skeleton notice
on the last notice day in a delivery month must by 10:00 a.m. on the next
day furnish all information which is required on the usual delivery notice.
A person re-issuing a skeleton notice on the first position day of a
successive delivery month (i.e. -the next calendar month) must furnish all
information which is required on the usual delivery notice by 1:00 p.m. on
first notice day. 23R (05/01/95)
1054.00 Failure to Accept Delivery - Where a buyer to whom a delivery has
been assigned by the Clearing House under Regulation 1048.01 fails to take such
delivery and make payment when payment is due, the seller tendering such
delivery shall promptly sell the commodity on the open market for the account of
the delinquent. He shall then immediately notify the Clearing House of the
default, the contract price, and the re-sale price, and the Clearing House shall
immediately serve a like
Ch10 Delivery Procedures
------------------------
notice upon the delinquent. Thereupon the delinquent shall be obligated to pay
to the seller, through the Clearing House, the difference between the contract
price and the re-sale price. 289 (05/01/95)
1054.00A Failure to Accept Delivery - Rule 1054.00 provides that when a buyer
fails to take delivery and make payment at the prescribed time, the issuer of
the delivery 'shall promptly sell the commodity on the open market for the
account of the delinquent'.
Does this mean that the seller is to sell the warehouse receipts in the cash
market or sell futures in the pit and make a new tender? Also, what is the
meaning of the term 'promptly'? If the deliverer, thinking to accommodate the
delinquent, waits until 1:10, at which time the market is 5 lower than at 1:00
has he assumed any liability because of the delay? If it is the warehouse
receipts which are to be sold out, what determines the market price? Frequently
an elevator operator will pay more for his own receipts than for another's; or a
processor may pay a higher basis for one grade than another, grade differential
to the contrary. If futures are to be sold in the pit, who then is responsible
for the mechanics of tender and the assumption of interest?
The Board approved the opinion of the Rules Committee that the seller must have
the right to act in either the cash or futures market at his discretion without
recourse on the part of the defaulting buyer so long as action is taken prior to
9:45 A.M. the next business day. 38R (09/01/94)
1056.01 Storage Rates, Grain - To be valid for delivery on futures contracts,
all warehouse receipts and shipping certificates covering grain in regular store
or under obligation for shipment must indicate the applicable storage rate or
premium charge. No warehouse receipts or shipping certificates shall be valid
for delivery on futures contracts unless the storage rates or premium charges on
such grain shall have been paid up to and including the 18th calendar day of the
preceding month, and such payment endorsed on the warehouse receipt or shipping
certificate. Unpaid accumulated storage rates and premium charges at the posted
rate applicable to the warehouse or shipping station where the grain is stored
or under obligation for shipment shall be allowed and credited to the buyer by
the seller to and including date of delivery. Further, no warehouse receipt or
shipping certificate shall be valid for delivery if the receipt or shipping
certificate has expired prior to delivery or has an expiration date in the month
in which delivered. 1641
If storage rates are not paid on-time up to and including the 18th calendar day
preceding the delivery months of March, July and September and by the first
calendar day of each of these delivery months, a late charge will apply. The
late charge will be an amount equal to the total unpaid accumulated storage
rates multiplied by the "prime interest rate" in effect on the day that the
accrued storage rates are paid plus a penalty of 5 percentage points, all
multiplied by the number of calendar days that storage is overdue, divided by
360 days. The term "prime interest rate" shall mean the lowest of the rates
announced by each of the following four banks at Chicago, Illinois, as its
"prime rate": Bank of America-Illinois. The First National Bank of Chicago,
Harris Trust & Savings Bank, and the Northern Trust Company.
The storage rates on Corn, Wheat and Soybeans for delivery shall not exceed
15/100 of one cent per bushel per day.
The storage rates on Oats for delivery shall not exceed 13/100 of one cent per
bushel per day.
See Regulation 10C56.01-Payment of Premium Charges for March 2000 and subsequent
Corn futures contracts.
See Regulation 10S56.01-Payment of Premium Charges for January 2000 and
subsequent Soybean futures contracts. (03/01/00)
Ch10 Regularity of Warehouses
*1081.01 Regularity of Warehouses and Issuers of Shipping Certificates -
Persons operating grain warehouses or shippers who desire to have such
warehouses or shipping stations made regular for the delivery of grain under the
Rules and Regulations shall make application for an initial Declaration of
Regularity on a form prescribed by the Exchange prior to May 1, 1994, and every
even year thereafter, for a two-year term beginning July 1, 1994, and every even
year thereafter, and at any time during a current term for the balance of that
term. Regular grain warehouses or shippers who desire to increase their regular
capacity during a current term shall make application for the desired amount of
total regular capacity on the same form. Initial regularity for the current term
and increases in regularity shall be effective either thirty days after a notice
that a bona fide application has been received is posted on the floor of the
exchange, or the day after the application is approved by the Exchange,
whichever is later. Applications for a renewal of regularity shall be made prior
to May 1, 1994, and every even year thereafter, for the respective years
beginning July 1, 1994, and every even year thereafter, and shall be on the same
form.
The following shall constitute the requirements and conditions for regularity:
(1) The warehouse or shipping station making application shall be
inspected by the Registrar or the United States Department of Agriculture. Where
application is made to list as regular a warehouse which is not regular at the
time of such application, the applicant may be required to remove all grain from
the warehouse and to permit the warehouse to be inspected and the grain graded,
after which such grain may be returned to the warehouse and receipts issued
therefor.
See Regulation 10C81.01(1)-Regularity of Warehouses and Issuers of Shipping
Certificates for March 2000 and subsequent Corn futures contracts.
See Regulation 10S81.01(1)-Regularity of Warehouses and Issuers of Shipping
Certificates for January 2000 and subsequent Soybean futures contracts.
(2) Such warehouse shall be connected by railroad tracks with one or more
railway lines.
See Regulation 10C81.01(2)-Regularity of Warehouses and Issuers of Shipping
Certificates for March 2000 and subsequent Corn futures contracts
See Regulation 10S81.01(2)-Regularity of Warehouses and Issuers of Shipping
Certificates for January 2000 and subsequent Soybean futures contracts.
(3) The proprietor or manager of such warehouse or shipping station shall be in
good financial standing and credit, and shall meet the minimum financial
requirements and financial reporting requirements set forth in Appendix 4E.
No warehouse or shipping station shall be declared regular until the person
operating the same files a bond and/or designated letter of credit with
sufficient sureties in such sum and subject to such conditions as the
Exchange may require.
(4) Such warehouse or shipping station shall be provided with modern
improvements and appliances for the convenient and expeditious receiving,
handling and shipping of grain in bulk.
(5) The proprietor or manager of such warehouse or shipping station shall
honestly and cordially cooperate with the system of registration of
warehouse receipts or shipping certificates as established by law, and
furnish to the Registrar all needed information to enable him to keep a
correct record and account of all grain, together with the grades thereof,
received and delivered by them daily and of that remaining in store at
close of each week.
*Additions underlined; deletions bracketed for November 2001 and subsequent
contracts.
Ch10 Regularity of Warehouses
-----------------------------
(6) Safeguarding Condition of Grain in Warehouses.
(a) The Board of Trade shall designate an agency for registration of
public warehouse receipts, and only public warehouse receipts
registered with such agency shall be within the provisions of
paragraph (b) following.
(b) Whenever in the opinion of the operator of the warehouse any grain
stored in a public warehouse under his jurisdiction should be loaded
out in order to protect the best interests of the parties concerned,
such operator shall notify the agency giving the location and grades
of such grain. The agency shall immediately notify an appropriate
grain inspection service who shall at once proceed to the warehouse in
which the grain is stored and examine it in conjunction with the
Superintendent of such warehouse. If the grain inspection service
agrees with the Superintendent that the grain should be moved, it
shall so notify the Registrar of the Chicago Board of Trade. If the
grain inspection service does not agree with the Superintendent that
the grain should be moved, the operator of the warehouse shall have a
right to appeal to the Business Conduct Committee of the Board of
Trade. If on such appeal the Business Conduct Committee shall agree
with the Superintendent that the grain should be moved, the Business
Conduct Committee shall so notify the Registrar of the Board of Trade,
and the warehouse receipts covering the above specified lot or lots of
grain shall no longer be regular for delivery on Board of Trade future
contracts. Upon receiving such notice, either from the grain
inspection service, or from the Business Conduct Committee, the
Registrar shall notify the holder, or holders, or their agents,
together with the Chairman of the Business Conduct Committee, of the
total quantity of the grade of grain in question (selecting the oldest
registered warehouse receipt for such grain first, then such
additional registered warehouse receipts in the order of their
issuance as may be necessary to equal such total quantity of grain).
When this information reaches the Chairman of the Business Conduct
Committee he shall appoint a Committee consisting of five
disinterested handlers of cash grain, which Committee shall meet at
once and after taking into consideration various factors that
establish the value of the grade of the receipts held by such owner or
owners, shall determine the fair value of the grain, which price shall
be that to be paid by the operator. If the price offered is not
satisfactory, a Committee appointed by the Chairman of the Business
Conduct Committee (at the request of such owner), shall procure other
offers for such grain, and such offers shall be immediately reported
to the owner or his agent. If the owner refuses to accept any such
offers, he shall have the two following business days to order and
furnish facilities for loading such grain out of store, and during
this period the warehouseman shall be obliged to deliver the grain
called for by the warehouse receipts, but not more than three (3) days
may elapse after notification by the Registrar to the holder of the
receipt before satisfactory disposition shall have been made of the
grain, either by sale to the operator or by the ordering out and
furnishing facilities to load the same, provided the amount of such
grain does not exceed 100,000 bushels in any one elevator. If the
amount of grain in question exceeds 100,000 bushels, the owner, or
owners, of the warehouse receipts shall be allowed forty-eight hours
of grace over and above the before mentioned three days for each
100,000 bushels in excess of the first 100,000 bushels.
(c) In the event that the holder of the warehouse receipt, or his agent,
fails to move the grain or make other satisfactory disposition of same
within the prescribed time, it shall be held for his account, and any
loss in grade sustained shall likewise be for his account.
(d) Nothing in the foregoing provisions shall be construed as prohibiting
the warehouseman from fulfilling contracts from other stocks under his
control.
(7) The proprietor or manager of such warehouse shall promptly, by the proper
publication, advise the trade and the public of any damage to grain held in
store by it, whenever such damage shall occur to an extent that will render
it unwilling to purchase and withdraw from store, at its own cost, all such
damaged grain.
(8) The Board shall be assured that the operator or manager of the warehouse or
shipping station will agree to conform to Regulation 1049.03.
Ch10 Regularity of Warehouses
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(9) The proprietor or manager of such warehouse shall accord every facility to
any duly authorized committee, for the examination of its books and
records, for the purpose of ascertaining the stocks of all kinds of grain
which may be on hand at any time. Such examination and verification may be
made at any time by the Business Conduct Committee or its approved
inspection agents or, any other duly authorized committee to be appointed
by the Chairman of the Board, which committee shall have the authority to
employ experts to determine the quantity of grain in the elevators and to
compare the books and records of the said regular warehouses with the
records of the State or Federal Grain Warehouse Registrar.
(10) The proprietor or manager of a regular warehouse or shipping station shall
give assurance that all grain received in and shipped out of such warehouse
shall be weighed under the supervision of an agency approved by the
Exchange.
(11) No warehouse or shipping station shall be deemed suitable to be declared
regular if its location, accessibility, tariffs, insurance rates, or other
qualifications shall depart from uniformity to the extent that its receipts
or shipping certificates, if tendered in satisfaction of futures contracts,
will unduly depress the values of futures contracts or impair the efficacy
of futures trading in this market, or if the warehouseman or shipper
operating such warehouses or shipping stations engaged in unethical or
inequitable practices, or if, being a federally licensed warehouse, fails
to comply with the federal statute, rules or regulations, or, being a state
licensed Warehouse, fails to comply with the state statutes, rules and
regulations.
All warehousemen and shippers are and shall be and remain subject to the
Rules, Regulations and Rulings of the Board of Trade of the City of Chicago
on all subjects and in all areas with respect to which the U.S. Department
of Agriculture does not assert jurisdiction pursuant to the U.S. Warehouse
Act, as amended.
A regular warehouseman or an owner of warehouse receipts can make delivery
in a strike bound elevator. The taker of delivery is liable for all storage
charges. However, where the owner of warehouse receipts in a strike bound
elevator delivered against futures contracts has a bona fide bid for like
receipts in a strike free elevator and decides to load the grain out or
sell his receipts, the strike bound warehouseman has the option:
(a) to provide that same quantity and like quality of grain in store in
another regular warehouse, not on strike, in the same delivery market,
or
(b) to provide that same quantity and like quality of grain in store at
another location on mutually acceptable terms, or
(c) if no initial agreement can be reached as provided above, the strike
bound warehouseman must buy his warehouse receipts back at the bid
price in store for that same quantity and like quality of grain in a
strike free elevator in the same delivery market or he has the
alternative of proceeding as in (a) above. The bid (which must be a
basis bid versus futures) referred to in this paragraph must be good
for a minimum period of one hour and must be tendered in writing to the
strike bound warehouseman between 1:30 p.m. and 4:30 p.m. on a business
day and prior to 8:30 a.m., but not before 7:30 a.m., on the following
business day.
The warehouseman must respond to the bid as outlined above within the
time period during which the bid is alive.
Should the warehouseman question the validity of the bid, the question
shall be referred to a Standing Committee which shall have been
appointed on an annual basis by the Chairman of the Board, with the
approval of the Board. The Committee shall consist of three members
including one regular warehouseman with suitable alternates. In case
the strike bound elevator involved is in a market other than that
directly represented by the warehouseman appointed, the Chairman may
designate a member in said alternate market who is familiar with cash
grain values in that market. The sole duty of the Committee shall be to
determine that the bid is bona fide. The Committee shall not express
any opinion with respect to the economics of the bid.
Within the context of this Regulation, a strike bound elevator is
defined as the facility itself
Ch10 Regularity of Warehouses
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being on strike.
The maximum load-out charge on wheat and oats which has been tendered in
satisfaction of the Board of Trade futures contracts shall be 6 cents per
bushel.
The maximum premium for FOB conveyance on Corn and Soybean Shipping
Certificates which have been tendered in satisfaction of Board of Trade
futures contracts shall be 4 cents per bushel.
All fees for stevedoring services to load Corn and Soybeans into barges are
to be paid by the issuer of the Corn or Soybean Shipping Certificate.
The premium for FOB conveyance is payable at the time of invoice.
(12) Load-Out Procedures.
A. Load-Out Procedures Grains -
1. Corn and Soybeans; Wheat from Chicago, Burns Harbor and St. Louis;
and Oats from Chicago and Burns Harbor. An operator of a regular facility
has the obligation of loading grain represented by warehouse receipts or
shipping certificates giving preference to takers of delivery. When an
operator of a facility regular for the delivery of grain receives one or
more written loading orders for loading of grain against canceled warehouse
receipts or shipping certificates, the operator shall begin loading against
them within 3 business days following their receipt. When loadings against
written loading orders cannot be completed on the fourth business day
following their receipt, the operator shall continue loading against such
loading orders on each business day thereafter. All warehousemen and
shippers shall outload grain against canceled delivery instruments
consecutively without giving preference of the type of delivery instrument,
kind of grain or mode of transportation. He shall outload all such products
in the order in which suitable transportation, clean and ready to load is
constructively placed at his facility by the holder of the warehouse
receipt or shipping certificate, pursuant to bona fide loading orders
previously received, and at the loading rates provided in part B of this
Regulation.
2. Wheat from Toledo and Oats from Minneapolis-St. Paul - All
warehousmen shall inload and outload all agricultural products
consecutively without giving preference to the products owned by him over
the products of others, and without giving preference to one depositor over
another. He shall inload all such products consecutively in the order in
which they arrive at his warehouse, pursuant to the inloading orders
previously received so far as the warehouse capacity for grain and grade
permits. He shall outload all such product's in the order in which suitable
transportation, clean and ready to load is constructively placed at his
warehouse by the holder of the warehouse receipt, pursuant to bona fide
outloading orders previously received, except as provided in part B of this
Regulation.
It shall be the responsibility of the warehouse receipt or shipping
certificate holder to supply suitable transportation. Hopper cars shall
be considered suitable transportation if they can be sampled by pelican
in a manner approved by the appropriate grain sampling agency. Trucks
and non-suitable hopper cars may be loaded only with the express
agreement of the warehouseman.
Constructive placement at a warehouse or shipping station shall be
defined as follows:
(1) Rail cars-as defined in the appropriate Railroad Freight Tariff on
file with the Interstate Commerce Commission;
(2) Barges-Positioned at an appropriate fleeting service serving the
designated delivery point;
(3) Vessels-In possession of the appropriate Federal Grain Inspection
Service and/or National Cargo Bureau documents certifying readiness
to accept load-out at the designated delivery point.
It shall be the responsibility of the warehouse receipt or shipping
certificate holder to request the warehouseman to arrange for all
necessary Federal Grain Inspection Service and stevedoring service. The
warehouse receipt or shipping certificate holder may specify the
stevedoring service to be called. The warehouseman shall not be held
responsible for non-availability of these
Ch10 Regularity of Warehouses
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services.
B. Load-Out Rates for Grain - In the event a regular grain warehouse or
shipping station receives written loading orders for load-out of grain
against canceled warehouse receipts or shipping certificates, the
warehouseman or shipper shall be required to load out grain beginning
on the third business day following receipt of such loading orders or
on the day after a conveyance of the type identified in the loading
orders is constructively placed, whichever occurs later. The rate of
load-out for warehouses in Toledo and Minneapolis-St. Paul shall be at
the normal rate of load-out for the facility and the load-out rate for
all grain warehouses and shipping stations shall depend on the
conveyance and type of grain being loaded and shall not be less than
the following per business day:
[Enlarge/Download Table]
---------------------------------------------------------------------------------------------
Rail Conveyance or Water Conveyance
---------------------------------------------------------------------------------------------
(When receipt holder (When receipt holder Vessel Barge
requests in writing requests in writing or
individual weights and batch weights and
grades per car load) grades)/1/
---------------------------------------------------------------------------------------------
Wheat, Corn, 25 Hopper Cars 35 Hopper Cars 300,000 3 Barges
Soybeans Bushels
---------------------------------------------------------------------------------------------
Oats 15 Hopper Cars 20 Hopper Cars 180,000 2 Barges
Bushels
---------------------------------------------------------------------------------------------
Barge load-out rates for corn and soybeans will be at the shipping
station's registered daily rate of loading. When wheat and corn or
soybeans or when oats and corn or soybeans are in the lineup for
loading, the higher loading rate will apply for total barge loadings on
that day. However, a warehouseman or shipper is not obligated to load
barges of one type of grain that exceeds the daily barge loading rate
for that type of grain. Corn and soybeans are considered one type of
grain for this regulation pertaining to barge loading rates.
Regular grain warehouses and shipping stations shall not be required to
meet these minimum load-out rates when transportation has not been
actually placed at the warehouse, transportation equipment is not clean
and load ready, inspection services are not available, a condition of
force majeure exists, inclement weather prevents loading, or stevedoring
services are not available in the case of water conveyance. However,
the exceptions to load-out requirements shall not include grains or
soybeans which have not made grade.
In addition, regular warehouses in Toledo and Minneapolis-St. Paul shall
not be required to meet the minimum load-out rate for a conveyance when
a "like" conveyance has been constructively placed for load-in prior to
the "like" conveyance for load-out. However, when a conveyance for load-
out is constructively placed after a "like" conveyance for load-in, the
warehouse will load-in grain from the "like" conveyance at the normal
rate of load-in for the facility. This rate of load-in shall depend on
the conveyance(s) being unloaded and shall not be less than the
following minimums per business day:
----------------------------------------------------------------------------
Rail Conveyance or Water Conveyance
----------------------------------------------------------------------------
Vessel or Barge
----------------------------------------------------------------------------
Wheat, Corn, 35 Hopper Cars 50,000 Bushels 1 Barge
Soybeans
----------------------------------------------------------------------------
Oats 20 Hopper Cars 50,000 Bushels 1 Barge
----------------------------------------------------------------------------
_________________________
/1/ A batch weight and grade shall refer to a buyer's request in writing for 1
weight and 1 grade per 5 rail cars.
Ch10 Regularity of Warehouses
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Regular warehouses shall not be required to meet these minimum load-in
rates when a condition of force majeure exists, inspection services are
not available, inclement weather prevents unloading, or stevedoring
services are not available in the case of water conveyance.
Any increased overtime costs and charges for trimming and FGIS to meet
minimum load-out requirements shall be borne by warehouseman.
Vessel loading shall require 3 days pre-advice to warehouseman prior to
the date of arrival of the vessel. Failure to provide pre advice may
delay loading by the same number of days pre-advice is delayed prior to
date of arrival of the vessel.
Inability of a warehouse receipt holder to provide conveyance at an
elevator in a timely manner will affect load-out of barges accordingly.
For purposes of this regulation, vessel and barge are "like"
conveyances.
C. Notification to Warehouse - The warehouse operator or shipping station
shall load-in and load-out grains in the order and manner provided in
parts A and B of this Regulation, except that his obligation to load-out
grain to a given party shall commence no sooner than three business days
after he receives cancelled warehouse receipts and written loading
orders from such party, even if such party may have a conveyance
positioned to accept load-out of grain before that time. If the party
taking delivery presents transportation equipment of a different type
(rail, barge, or vessel) than that specified in the loading orders, he
is required to provide the warehouse operator with new loading orders,
and the warehouse operator shall be obligated to load-out grain to such
party no sooner than three business days after he receives the new
loading orders. Written loading orders received after 2:00 p.m. (Chicago
time) on a given business day shall be deemed to be received on the
following business day.
D. Storage and Premium Charges - Storage payments [and Premium Charges] on
[grain] wheat and oats to be shipped pursuant to loading orders shall
cease on the tenth business day after suitable transportation is
constructively placed for load-out or loading is complete, whichever is
earlier. Premium charges for corn and soybeans to be shipped pursuant
to loading orders shall cease on the business day loading is complete.
E. Records - All warehousemen and shippers shall keep adequate permanent
records showing compliance with the requirements of this Regulation.
Such records shall at all times be open for inspection by the designated
official or officials of the contract market.
F. Certification of Corn, Soybeans and Wheat - Effective September 1, 1992
and upon written request by a taker of delivery at the time loading
orders are submitted for the delivery of corn, soybeans or wheat against
canceled warehouse receipts, the delivery warehouseman shall certify in
writing to the taker of delivery on the day that the transportation
conveyance is loaded that the grain is of U.S. origin only. Warehouse
receipts issued prior to September 1, 1992 will be deliverable against
futures contracts beginning September 1992 only if the regular
warehouseman provides certification on the warehouse receipt that the
U.S. origin-only option is available to the taker of delivery of corn,
soybeans and wheat.
G. Barge Load-Out Procedures for Corn and Soybeans - When corn or soybeans
represented by shipping certificates are ordered out for shipment by
water conveyance, the regular shipper has the obligation to load-out
grain at his registered daily rate of loading. The shipper's obligation
shall begin to a party no sooner than 3 business days after he receives
canceled certificates and written loading orders from the party or 1
business day after the constructive placement of the water conveyance,
whichever is later.
(1) All loading orders and shipping instructions received prior to 2:00
p.m. on a given business day shall be considered dated that day and
shall be entitled to equal treatment. Orders received after 2:00
p.m. on a business day shall be considered dated the following
business day. Loading against all loading orders dated on a given
business day shall be completed before loading begins on any loading
orders dated on a subsequent business day.
Ch10 Regularity of Warehouses
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(2) When loading orders and shipping instructions are received by 2:00
p.m. of any given business day, the shipper will advise the owner by
10:00 a.m. the following business day of loading dates and tonnage
due. Notification will be by telephone, telex or telefax.
(3) Official grades as loaded into the water conveyance shall govern for
delivery purposes.
(4) Official weights as loaded into the barge shall govern for delivery
purposes when available, otherwise, it is the responsibility of the
taker to obtain official weights at the destination. Any other
governing weights and methods of obtaining weights and any such
other information on the weighing process must be mutually accepted
by the maker and taker of delivery before the barge is loaded. When
the official weight becomes known for a barge, overfills and
underfills will be settled on the market value, expressed as a
basis, for grain FOB barge at the barge loading station on the day
that the grain is loaded. Before the barge is loaded, the taker and
maker of delivery will agree on a basis over or under the nearby
futures that overfills and underfills will be settled on. On the day
that the weight tolerance becomes known to both parties, the flat
price settlement will be established by applying the basis to the
nearby futures month settlement price on the day of unloading or the
day of loading if origin weights are used. If the day of unloading
is the last trading day in the nearby futures month, the next
following futures month will be used for settlement. If the day of
unload is not a business day, the next following business day will
be used to establish the flat price. In order to convert the agreed
upon basis on the day that the grain was loaded to a basis relative
to the current nearby futures month, the futures spread on the day
of loading will be used, provided that, the nearby futures did not
close outside of the price limits set for all other futures months.
In this case, the spread on the first following business day that
the nearby futures closed within the price limits applicable for all
other futures months would be used.
(5) The shipper shall not be required to meet his minimum daily barge
load-out rate when transportation has not been actually placed at
the shipping station, transportation equipment is not clean and load
ready, inspection services are not available, a condition of force
majeure exists, or inclement weather prevents loading. However, the
exceptions to load-out requirements shall not include corn or
soybeans that have not made grade.
(6) For Illinois Waterway barge loading at Burns Harbor, Regulation
1081.01(13)(A.)(a) pertaining to the protection of the Chicago barge
rate and inclement weather will apply.
(7) Any expense for making the grain available for loading on the
Illinois Waterway will be borne by the party making delivery,
provided that the taker of delivery presents barge equipment clean
and ready to load within 10 calendar days following the scheduled
loading date of the barge on the Illinois Waterway. If the taker's
barges are not made available within 10 calendar days following the
scheduled loading date of the barge on the Illinois Waterway or the
taker cancels loading instructions and requests that shipping
certificates be re-issued, the taker shall reimburse the shipper for
any expenses for making the grain available. Taker and maker of
delivery have three days to agree to these expenses.
(8) The shipper shall load water conveyance at the shipping station
designated in the Shipping Certificate. If it becomes impossible to
load at the designated shipping station because of an Act of God,
fire, flood, wind, explosion, war, embargo, civil commotion,
sabotage, law, act of government, labor difficulties or unavoidable
mechanical breakdown, the shipper will arrange for water conveyance
to be loaded at another regular shipping station in conformance with
the Shipping Certificate and will compensate the owner for any
transportation loss resulting from the change in the location of the
shipping station. If the aforementioned condition of impossibility
prevails at a majority of regular shipping stations, then shipment
may be delayed for
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the number of days that such impossibility prevails at a majority
of regular shipping stations.
(9) See Regulation 10C81.01(12)G(9)-Regularity of Warehouses and
Issuers of Shipping Certificates for March 2000 and subsequent Corn
futures contracts.
See Regulation 10S81.01(12)G(9)-Regularity of Warehouses and
Issuers of Shipping Certificates for January 2000 and subsequent
Soybean futures contracts.
(10) In the event less than eleven shipping certificates of a like
grade/quality are outstanding at a shipping station the owner of
all such outstanding shipping certificates may cancel the shipping
certificates and obligate the shipper to provide a market value at
which the shipper will either buy back all the canceled shipping
certificates or sell the balance of Corn or Soybeans of a like
grade/quality to complete a barge loading of at least 55,000
bushels, the choice being at the discretion of the taker of
delivery.
(13) Location.
A. Corn. For the delivery of corn, regular warehouses or shipping stations
may be located within the Chicago Switching District or within the Burns
Harbor, Indiana Switching District or within the Toledo, Ohio Switching
District or the St. Louis-East St. Louis or Alton Switching District.
See Regulation 10C81.01(13)-Location for March 2000 and subsequent Corn
futures contracts.
No such warehouse or shipping station within the Chicago Switching
District shall be declared regular unless it is conveniently
approachable by vessels of ordinary draft and has customary shipping
facilities. Ordinary draft shall be defined as the lesser of (1) channel
draft as recorded in the Lake Calumet Harbor Draft Gauge, as maintained
by the Corps of Engineers, U.S. Army, minus one (1) foot, or (2) 20
feet.
Delivery in Burns Harbor must be made "in store" in regular elevators or
by shipping certificate at regular shipping stations providing water
loading facilities and maintaining water depth equal to normal seaway
draft of 27 feet.
In addition, deliveries of grain may be made in regular elevators or
shipping stations within the Burns Harbor Switching District PROVIDED
that:
(a) When grain represented by warehouse receipts or shipping
certificates is ordered out for shipment by a barge, it will be the
obligation of the party making delivery to protect the barge freight
rate from the Chicago Switching District (i.e. the party making
delivery and located in the Burns Harbor Switching District will pay
the party taking delivery an amount equal to all expenses for the
movement of the barge from the Chicago Switching District, to the
Burns Harbor Switching District and the return movement back to the
Chicago Switching District).
If inclement weather conditions make the warehouse or shipping
station located in the Burns Harbor Switching District unavailable
for barge loadings for a period of five or more calendar days, the
party making delivery will make grain available on the day following
this five calendar day period to load into a barge at one mutually
agreeable water warehouse or shipping station located in the Chicago
Switching District; PROVIDED that the party making delivery is
notified on the first day of that five-day period of inclement
weather that the barge is available for movement but cannot be moved
from the Chicago Switching District to the Burns Harbor Switching
District, and is requested on the last day of this five day calendar
period in which the barge cannot be moved.
(b) When grain represented by warehouse receipts or shipping
certificates is ordered out for shipment by vessel, and the party
taking delivery is a recipient of a split delivery of grain between
a warehouse or shipping station located in Burns Harbor and a
warehouse or shipping station in Chicago, and the grain in the
Chicago warehouse or
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shipping station will be loaded onto this vessel; it will be the
obligation of the party making delivery at the request of the party
taking delivery to protect the holder of the warehouse receipts or
shipping certificates against any additional charges resulting from
loading at one berth in the Burns Harbor Switching District and at
one berth in the Chicago Switching District as compared to a single
berth loading at one location. The party making delivery, at his
option, will either make the grain available at one water warehouse
or shipping station operated by the party making delivery and
located in the Chicago Switching District for loading onto the
vessel, make grain available at the warehouse in Burns Harbor upon
the surrender of warehouse receipts or shipping certificates issued
by other regular elevators or shipping stations located in the
Chicago Switching District at the time vessel loading orders are
issued, or compensate the party taking delivery in an amount equal
to all applicable expenses, including demurrage charges, if any, for
the movement of the vessel between a berth in the other switching
district. On the day that the grain is ordered out for shipment by
vessel, the party making delivery will declare the regular warehouse
or shipping station in which the grain will be available for
loading.
Delivery in Toledo must be made "in store" in regular elevators
providing water loading facilities and maintaining water depth equal to
normal seaway draft of 27 feet.
However, deliveries of corn may be made in off-water elevators within
the Toledo, Ohio Switching District PROVIDED that the party making
delivery makes the corn available upon call within five calendar days to
load into water equipment at one water location within the Toledo, Ohio
Switching District. The party making delivery must declare within one
business day after receiving warehouse receipts and loading orders the
water location at which corn will be made available. Any additional
expense incurred to move delivery corn from an off-water elevator into
water facilities shall be borne by the party making delivery; PROVIDED
that the party taking delivery presents water equipment clean and ready
to load within fifteen calendar days from the time the corn has been
made available. See Regulation 10C81.01(13)-Location for March 2000 and
subsequent Corn futures contracts.
Delivery in the St. Louis-East St. Louis or Alton Switching Districts
must be "in store" in regular elevators providing barge-loading
facilities and maintaining water depth equal to the average draft of the
current barge loadings in the St. Louis-East St. Louis and Alton barge-
loading districts. See Regulation 10C81.01(13)-Location for March 2000
and subsequent Corn futures contracts.
B. Oats. For the delivery of oats, regular warehouses may be located within
the Chicago Switching District or within the Burns Harbor, Indiana
Switching District (subject to the provisions of paragraph A above) or
within the Minneapolis, Minnesota or St. Paul, Minnesota Switching
Districts.
Delivery in the Minneapolis or St. Paul Switching District must be made
"in store" in regular elevators providing barge-loading facilities and
maintaining water depth equal to the average draft of the current barge
loadings in the Minneapolis and St. Paul barge-loading districts.
However, deliveries of oats may be made in interior off-water elevators
within the Minneapolis or St. Paul Switching District, PROVIDED that the
party making delivery makes the oats available upon call within seven
calendar days to load into a barge at one river location in the
Minneapolis or St. Paul barge-loading district. The party making
delivery must declare, within one business day after receiving warehouse
receipts and loading orders, the river location at which the oats will
be made available. Any additional expense incurred to move delivery oats
from an off-water elevator into barges shall be borne by the party
making delivery; PROVIDED that the party taking delivery presents barge
equipment clean and ready to load within fifteen calendar days from the
time warehouse receipts and loading orders are tendered to the
delivering party.
Official weights and official grades as loaded into the barge shall
govern for delivery purposes.
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C. Wheat. For the delivery of wheat, regular warehouses may be located
within the Chicago Switching District or within the Burns Harbor,
Indiana Switching District (subject to the provisions of Paragraph A
above), within the Toledo, Ohio Switching District, or with respect to
only No. 1 Soft Red Winter and No. 2 Soft Red Winter Wheat, within the
St. Louis-East St. Louis or Alton Switching Districts.
Delivery in Toledo must be made "in store" in regular elevators
providing water loading facilities and maintaining water depth equal to
normal seaway draft of 27 feet.
However, deliveries of wheat may be made in off-water elevators within
the Toledo, Ohio Switching District PROVIDED that the party making
delivery makes the grain available upon call within five calendar days
to load into water equipment at one water location within the Toledo,
Ohio Switching District. The party making delivery must declare within
one business day after receiving warehouse receipts and loading orders
the water location at which wheat will be made available.
Any additional expense incurred to move delivery grain from an off-water
elevator into water facilities shall be borne by the party making
delivery; PROVIDED that the party taking delivery presents water
equipment clean and ready to load within fifteen calendar days from the
time the grain has been made available.
Official weights and official grades as loaded into the water equipment
shall govern for delivery purposes.
Delivery in the St. Louis-East St. Louis or Alton Switching Districts
must be "in store" in regular elevators providing barge loading
facilities and maintaining water depth equal to the average draft of the
current barge loadings in the St. Louis-East St. Louis and Alton barge
loading districts.
D. Soybeans. For the delivery of soybeans, regular warehouses may be
located within the Chicago Switching District or within the Burns
Harbor, Indiana Switching District (subject to the provisions of
Paragraph A above), within the Toledo, Ohio Switching District, or
within the St. Louis-East St. Louis or Alton Switching Districts See
Regulation 10S81.01(13)-Location for January 2000 and subsequent
Soybean futures contracts.
Delivery in Toledo must be made "in store" in regular elevators
providing water loading facilities and maintaining water depth equal
to normal seaway draft of 27 feet. However, deliveries of soybeans
may be made in off-water elevators within the Toledo, Ohio Switching
District PROVIDED that the party making delivery makes the soybeans
available upon call within five calendar days to load into water
equipment at one water location within the Toledo, Ohio Switching
District. The party making delivery must declare within one business
day after receiving warehouse receipts and loading orders the water
location at which soybeans will be made available. Any additional
expense incurred to move delivery soybeans from an off-water
elevator into water facilities shall be borne by the party making
delivery; PROVIDED that the party taking delivery presents water
equipment clean and ready to load within fifteen calendar days from
the time the soybeans have been made available. Official weights and
official grades as loaded into the water equipment shall govern for
delivery purposes. See Regulation 10S81.01(13)-Location for January
2000 and subsequent Soybean futures contracts.
Delivery in the St. Louis-East St. Louis or Alton Switching
Districts must be "in store" in regular elevators providing barge
loading facilities and maintaining water depth equal to the average
draft of the current barge loadings in the St. Louis-East St. Louis
and Alton barge loading districts. See Regulation 10S81.01(13)-
Location for January 2000 and subsequent Soybean futures contracts.
(14) Billing
A. Wheat, Corn, Soybeans and Oats (Chicago delivery). The Chicago
warehouseman is not required to furnish transit billing on grain
represented by warehouse receipt deliveries in
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Chicago, Illinois. Delivery shall be flat.
B. Oats (Minneapolis, St. Paul delivery).
(1) When oats represented by warehouse receipts delivered in Minneapolis
or St. Paul are ordered out for shipment by rail, it shall be the
obligation of seller to furnish, no later than when cars are placed
or constructively placed at the elevator, to the party taking
delivery, inbound Freight Bills (rail tonnage or order equivalent
truck or barge tonnage) protecting the applicable proportional rate
applicable to Chicago from the warehouse in which the grain is
located. The Freight Bills shall be for the kind and quantity of the
commodity designated by the warehouse receipt and must permit such
commodity to be shipped at the minimum proportional rate applicable
to Chicago effective as of the date of shipment from point of origin
shown by the Freight Bill.
(a) Delivery at Minneapolis. When delivery is made at an elevator
within the Minneapolis Switching District, such Freight Bills
must permit one further free transit stop at interior transit
points or be accompanied by a check to cover one such transit
stop.
(b) Delivery at St. Paul. When delivery is made at an elevator
within the St. Paul Switching District, such Freight Bills must
permit one further free transit stop at interior transit points,
or be accompanied by a check to cover such transit stop, and in
addition must also permit movement to industries within the
switching limits of Minneapolis at no greater cost than the
maximum switching charges between industries located with the
switching limits of Minneapolis.
(2) In lieu of the Freight Bills or order equivalent tonnage specified
above, seller may furnish to the party taking delivery "short-rate"
Freight Bills or make compensation as specified in Section (b).
(a) "Short-rate" Freight Bills (which otherwise conform to the
requirements of this Regulation). "Short-rate" Freight Bills
shall be accompanied by a certified check, or other acceptable
payment, in an amount equal to the difference between the
freight charges which would be incurred in shipping the quantity
of the commodity from Minneapolis to Chicago (based on the
proportional rate applicable in connection with such "short-
rate" Freight Bills) and the freight charges for such shipment
based on the minimum proportional tariff rate applicable in
connection with Freight Bills other than "short-rate" Freight
Bills showing shipment from points of origin as of the same date
as the "short-rate" Freight Bills furnished.
(b) Compensation in Lieu of Freight Bills or order equivalent
tonnage. A certified check or other acceptable payment may be
substituted for Freight Bills provided it is in an amount equal
to the difference between the freight charges which would be
incurred in shipping the commodity from Minneapolis to Chicago
based on the flat tariff rate effective as of the date of
loading for rail shipment and the charges for such shipment
based on the minimum proportional tariff rate effective as of
the same date.
(3) Due Bills issued by the Western Weighing and Inspection Bureau may
be used when necessary in lieu of Freight Bills that conform to the
provisions of this Regulation. Such Due Bills may be surrendered by
the seller to the party loading out delivery grain by rail when such
Freight Bills are not yet available because of the unloading of the
commodity into an elevator during the last few days of the delivery
month or on the delivery of "Track" grain. Such Due Bills shall
specify the date, origin and rate of the Freight Bills in lieu of
which they are issued and shall be completely filled out except for
the signature.
(4) The term Freight Bills as used in this Regulation means the recorded
inbound paid Freight Bills, authorized duplicates thereof, or
tonnage credit slips, conforming to the rules and regulations of
Western Trunk Line Tariff No. 331-Z, Fred Ofcky, Agent, ICC
Ch10 Regularity of Warehouses
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No. A-4774, amendments thereto or reissues thereof.
C. Wheat (Toledo and St. Louis delivery). The warehouseman is not required
to furnish transit billing on wheat represented by warehouse receipts
delivery in Toledo, Ohio, St. Louis, Missouri, East St. Louis, Illinois,
or Alton, Illinois. Delivery shall be flat.
D. Corn (Toledo and St. Louis delivery). The warehouseman is not required
to furnish transit billing on corn represented by warehouse receipts
delivery in Toledo, Ohio, St. Louis, Missouri, East St. Louis, Illinois
or Alton, Illinois. Delivery shall be flat. See Regulation
10C81.01(14)-Billing for March 2000 and subsequent Corn futures
contracts.
E. Soybeans (Toledo and St. Louis delivery). The warehouseman is not
required to furnish transit billing on soybeans represented by warehouse
receipts delivery in Toledo, Ohio, St. Louis, Missouri, East St. Louis,
Illinois, or Alton, Illinois. Delivery shall be flat. See Regulation
10S81.01(14)-Billing for January 2000 and subsequent Soybean futures
contracts.
F. Wheat, Corn, Soybeans and Oats (Burns Harbor Delivery). When grain
represented by warehouse receipts delivered in Burns Harbor is ordered
out for shipment by rail, it will be the obligation of the party making
delivery to protect the Chicago rail rate, if lower, which would apply
to the owner's destination had a like kind and quantity of grain
designated on warehouse receipts been loaded out and shipped from a
regular warehouse located in the Chicago Switching District. If grain is
loaded out and shipped to an industry in the Chicago Switching District,
the party making delivery will protect the minimum, crosstown switch
charge in the Chicago Switching District.
When rail loading orders are submitted, the party taking delivery shall
state in writing if he elects to receive the applicable rail rates from
Burns Harbor or Chicago. If the party taking delivery specifies Burns
Harbor, the party making delivery will load rail cars at the Burns
Harbor warehouse and will not be required to protect the Chicago rates.
If the party taking delivery specifies Chicago rates, the party making
delivery will declare on the day that the grain is ordered out for
shipment by rail, the warehouse at which the grain will be made
available, which is operated by the party making delivery and is located
either in the Burns Harbor or the Chicago Switching Districts. If the
declared warehouse is located in the Chicago Switching District, the
party making delivery will provide only that billing specified in
Regulation 1081.01(14)A.
However, if the declared warehouse is located in Burns Harbor and the
rail rate from Chicago or the minimum Chicago crosstown switch charge
requires protection, the party making delivery will compensate the party
taking delivery. The compensation shall be in an amount equivalent to
the difference of the freight charges from Burns Harbor and the freight
charges which would be applicable had the grain been loaded at and
shipped from a warehouse located in the Chicago Switching District to
the owner's destination.
(15) All applications for a declaration of regularity or for renewal of
regularity, in an amount in excess of previously approved regularity will
be subject to a diligent and prudent analysis by the Exchange to insure
that the warehouseman or shipper meets all rules and regulations prescribed
by the Board of Trade and that the grant of regularity for the requested
storage capacity or maximum number of certificates allowed to be issued, or
any part thereof, will not unduly distort the values of grain futures
contracts or impair the efficacy of futures trading in these markets.
(16) Persons operating regular warehouses or shipping stations shall be subject
to the Association's Rules and Regulations pertaining to arbitration
procedures, as set forth in Chapter 6, and, with respect to compliance with
Rules and Regulations pertaining to a warehouse's or shipper's regularity,
shall be subject to the Association's Rules and Regulations pertaining to
disciplinary procedures, as set forth in Chapter 5.
(17) Persons operating regular warehouses or shipping stations shall consent to
the disciplinary jurisdiction of the Exchange for five years after such
regularity lapses, for conduct pertaining to regularity which occurred
while the warehouse or shipping station was regular. (12/01/00)
Ch10 Regularity of Warehouses
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1081.01A Inspection - Chicago Elevators - Any Grain Warehouses in Chicago,
regular for the delivery of grain under the Rules and Regulations of the
Association, shall require inbound and outbound inspections as mandated by the
U.S. Grain Standards Act and/or the U.S. Warehouse Act.
Nothing herein shall negate the rights of persons shipping grain into or out of
such Warehouses to request and obtain on such grain official sample lot
inspections as defined in the U.S. Grain Standards Act, and such inspections or
any appeal therefrom, shall be the settlement grade.
When grain is delivered in satisfaction of warehouse or shipping certificate,
receipts, the holder of the warehouse receipts or shipping certificates shall be
entitled to an official sample lot inspection as defined in the U.S. Grain
Standards Act unless otherwise agreed. 3R (03/01/00)
1081.01B Billing When Grain is Loaded Out - The Board makes the following
interpretations:
1. Is it then the obligation of the operator of the elevator to have such
billing on hand backing all deliveries - or only (as the Regulation seems to
state) when such grain is loaded out?
The Regulations are explicit in stating that billing need be available when
such grain is loaded out. The warehouseman makes the decision and takes the
risk at the time of delivery and any time until the grain is ordered loaded
if he does not have billing.
2. What is meant by equities?
Equities are defined in the Regulation and do not include values occasioned
by changes in freight rates as they would apply to the outboard movement.
43R (09/01/94)
1081.01C Car of Specified Capacity - Where a seller of an 80,000 Ib. capacity
car shows conclusively that an 80,000 Ib. capacity car was ordered, and the
railroad for its own convenience provided a 100,000 Ib. capacity car, the basis
for settlement should be the same as though an 80,000 Ib. capacity car had been
supplied. 14R (09/01/94)
1082.00 Insurance - Grain covered by warehouse receipts tendered for delivery
must be insured against the contingencies provided for in a standard "All Risks"
policy (including earthquake) to such an extent and in such amounts as required
by the Board of Directors. It shall be the duty of the operators of all regular
warehouses to furnish the Exchange with either a copy of the current insurance
policy or policies, or a written confirmation from the insurance company that
such insurance has been effected. 292 (08/01/96)
1082.00A Insurance - The warehouseman shall insure grain and soybeans covered
by warehouse receipts tendered for delivery against the contingencies provided
for in the standard "All Risks" policy (including earthquakes). (09/01/94)
1083.00 Variation Allowed - Deliveries of grain in store may vary not more
than one percent from the quantity contracted for: provided, however, that no
lot in any one warehouse shall contain less than 5,000 bushels of any one grade.
291 (09/01/94)
1083.01 Excess or Deficiency in Quantity - In the load-out of grain from an
elevator or warehouse, the quantity of gross grain covered by the warehouse
receipt shall be loaded out, and any excess or deficiency between the quantity
of net grain loaded out and the quantity of net grain covered by the warehouse
receipt shall be paid for to or by (as the case may be) the elevator or
warehouse proprietor or manager at the average market price on the day of load-
out: the buyer to pay storage on the net weight covered by the warehouse
receipt. In the event that in the final out-turn there is a shortage in the
gross quantity called for in the receipt, the net quantity of grain required by
the receipt shall be the factor in settlement, and any variation therefrom in
the net amount of grain loaded out against the receipt shall be paid for by the
elevator or warehouse proprietor or manager to the owner of the receipt at the
average market price on the day of load-out. In the load-out of grain the gross
quantity of grain, which includes dockage shall not exceed the net quantity by
more than one percent. 1640 (09/01/94)
1084.01 Revocation, Expiration or Withdrawal of Regularity - Any regular
warehouse or
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-----------------------------
shipper may be declared by the Business Conduct Committee, or pursuant to
Regulation 540.10, the Hearing Committee to be irregular at any time if it does
not comply with the conditions above set forth. If the designation of a
warehouse or shipper as regular shall be revoked, a notice shall be posted on
the bulletin board announcing such revocation and also the period of time, if
any, during which the receipts or certificates issued by such house or shipper
shall thereafter be deliverable in satisfaction of futures contracts under the
Rules and Regulations.
In the event of revocation, expiration or withdrawal of regularity, or in the
event of sale or abandonment of the properties where regularity is not reissued,
holders of outstanding warehouse or shipping certificates receipts shall be
given thirty days to take load-out of the commodity from the facility. If a
holder of an outstanding warehouse receipt or shipping certificate chooses not
to take load-out during this period, the facility must provide him with another
warehouse receipt or shipping certificate at another, mutually acceptable
regular warehouse or shipping station, with adjustments for differences in
contract differentials. Alternatively, if such warehouse receipt or shipping
certificate is unavailable, the facility must provide the holder with 0an
equivalent quantity and quality of the grain designated in the warehouse receipt
or shipping certificate at a mutually acceptable location. 1621 (03/01/00)
1085.01 Application for Declaration of Regularity - All applications by
operators of warehouses for a declaration of regularity under Regulation 1081.01
shall be on the following form:
WAREHOUSEMAN'S/SHIPPER'S APPLICATION FOR A DECLARATION OF REGULARITY
-
UPON CONTRACTS FOR FUTURE DELIVERY UNDER THE CHARTER,
RULES AND REGULATIONS OF THE BOARD OF TRADE OF THE CITY
OF CHICAGO FOR THE DELIVERY OF________________________
________________, 20________
Board of Trade of the
City of Chicago
Chicago, Illinois
Gentlemen:
We, the_____________________________________________ (hereinafter called
the Warehouseman/Shipper) owner or lessee of the
--------
warehouse _________________________________________________________________
---------
located at________________________________________________________________
and/or shipping station located at mile marker _______________________________.
----------------------------------------------
having a storage capacity of__________________________ bushels of grain
and/or applying for _______________ bushels as a registered total daily rate
------------------- ----------------------------------------
of loading barges and having a bond under the United States Warehouse Act
-----------------
___________________________________________________ in the sum of
__________________________ Dollarsand/or a designated letter of credit, do
------------------------------------
hereby make application to the Board of Trade of the City of Chicago
(hereinafter called Exchange) for a declaration of regularity to handle, and
to receive and store or issue Shipping Certificates for
----------------------------------
______________________ for delivery upon contracts for future delivery for a
period beginning________________ and ending Midnight June 30,_______________.
Conditions of Regularity
Such declaration of regularity, if granted, shall be cancellable by the Exchange
whenever the following conditions shall not be observed.
1. The Warehouseman/Shipper must:
(1) give such bonds and/or designated letter of credit to the Exchange as it
may require.
(2) submit to the Exchange with such application for a declaration of
regularity, a tariff listing in detail the rates for the handling and
storage of grain; submit promptly to the Exchange all changes in said
tariff, publish and display such tariff.
(3) remove no grain from the warehouse/shipping station save at the request of
the owner or owners thereof upon surrender of the warehouse
receipts/shipping certificates.
(4) notify the Exchange immediately of any change in capital ownership and of
any reduction in total capital of 20 percent or more from the level
reported in the last financial statement filed with the Exchange.
(5) make such reports, keep such records, and permit such warehouse visitation
as the Secretary of Agriculture may prescribe; comply with all applicable
Rules and Regulations and orders promulgated by the Secretary of
Agriculture or the Government agency administering the Commodity Exchange
Act; and comply with all requirements of the Exchange permitted or required
by such Rules and Regulations or orders.
(6) maintain and furnish to all holders of warehouse
receipts/shipping/certificates on grain tendered in satisfaction of futures
contracts insurance as provided in Rule 1004.00.
(7) make application for renewal of a declaration of regularity in writing
on or before May 1, 1994, and every even year thereafter.
2. The Warehouse/Shipper must be:
(1) subject to the prescribed examination and approval of the Exchange.
(2) properly safeguarded and patrolled.
(3) equipped to handle grain expeditiously.
3. The Warehouse/Shipping Station and Warehouseman/Shipper must conform to the
uniform requirements of the Exchange as to location, accessibility and
suitability as may be prescribed in the Rules and Regulations of the
Exchange.
Ch10 Regularity of Warehouses
-----------------------------
AGREEMENTS OF WAREHOUSEMAN
The Warehouseman/Shipper expressly agrees:
(1) that all grain tendered in satisfaction of futures contracts shall be
weighed by an Official Weigher. An Official Weigher shall be a person or
agency approved by the Exchange.
(2) that all warehouse receipts/shipping certificates shall be registered with
the Registrar of the Exchange.
(3) to abide by all of the Rules and Regulations of the Exchange relating to the
warehousing or shipping of commodities deliverable in satisfaction of
futures contracts and the delivery thereof in satisfaction of futures
contracts.
(4) that the Exchange may cancel said declaration of regularity, if granted, for
any breach of said agreements.
(5) that the signing of this application constitutes a representation that the
conditions of regularity are complied with and will be observed during the
life of the declaration of regularity and, if found to be untrue, the
Exchange shall have the right to cancel said declaration of regularity
immediately.
(6) to be subject to the Association's Rules and Regulations pertaining to
arbitration procedures, as set forth in Chapter 6, and with respect to
compliance with Rules and Regulations pertaining to regularity, to be
subject to the Association's Rules and Regulations pertaining to
disciplinary procedures, as set forth in Chapter 5; and to abide by and
perform any disciplinary decision imposed upon it or any arbitration award
issued against it pursuant to such Rules and Regulations.
(7) to consent to the disciplinary jurisdiction of the exchange for five years
after regularity lapses for conduct pertaining to regularity which occurred
while the warehouse/shipper was regular.
____________________
Company
By____________________
Title
Bond in the amount of________________ duly filed ________________________
Date
______________________________
Secretary
This application is approved and a declaration of regularity is granted by the
Board of Trade of the City of Chicago.
_________________________________
Date
______________________________
Secretary
1622 (03/01/00)
1086.01 Federal Warehouses - In compliance with Section 5a, subparagraph (7) of
Commodity Exchange Act, receipts for grain stored in elevators (listed as
Federally licensed in Appendices 10A, 10B, 10C, 10D and 10E) licensed under the
United States Warehouse Act of August 11, 1916, as amended will be deliverable
in satisfaction of futures contracts. 1829 (09/01/94)
[Enlarge/Download Table]
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Chapter 10C
Corn Futures
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Ch10C Trading Conditions.....................................................
C1001.01 Application of Regulations.....................................
C1004.01 Unit of Trading................................................
C1005.01 Months Traded in...............................................
C1006.01 Price Basis....................................................
C1007.01 Hours of Trading...............................................
C1008.01 Trading Limits.................................................
C1009.01 Last Day of Trading............................................
C1010.01 Margin Requirements............................................
C1012.01 Position Limits and Reportable Positions.......................
Ch10C Delivery Procedures....................................................
C1036.00 Grade Differentials............................................
C1036.01 Location Differentials.........................................
C1038.01 Grades.........................................................
C1041.01 Delivery Points................................................
C1043.01 Deliveries.....................................................
C1043.02 Registration of Corn Shipping Certificates.....................
C1043.03 Reissuance of Shipping Certificates............................
C1044.01 Certificate Format.............................................
C1046.01 Location for Buying or Selling Delivery Instruments............
C1047.01 Delivery Notices...............................................
C1048.01 Method of Delivery.............................................
C1049.01 Time of Delivery, Payment, Form of Delivery Notice.............
C1049.02 Time of Issuance of Delivery Notice............................
C1049.03 Buyer's Report of Eligibility to Receive Delivery..............
C1049.04 Seller's Invoice to Buyers.....................................
C1049.05 Payment........................................................
C1050.01 Duties of Members..............................................
C1051.01 Office Deliveries Prohibited...................................
C1054.01 Failure to Accept Delivery.....................................
C1056.01 Payment of Premium Charges.....................................
Ch10C Regularity of Issuers of Shipping Certificates.........................
C1081.01 Regularity of Warehouses and Issuers of Shipping Certificates..
C1081.01A Inspection.....................................................
C1081.01B Billing When Grain is Loaded Out...............................
C1081.01C Car of Specified Capacity......................................
C1082.01 Insurance......................................................
C1083.01 Variation Allowed..............................................
C1083.02 Excess or Deficiency in Quantity...............................
C1084.01 Revocation, expiration or Withdrawal of Regularity.............
C1085.01 Application for Declaration of Regularity......................
C1086.01 Federal Warehouses.............................................
================================================================================
Chapter 10C
Corn Futures
================================================================================
Ch10C Trading Conditions
C1001.01 Application of Regulations - Transactions in Corn futures shall be
subject to the General Rules of the Association as far as applicable and shall
also be subject to Regulations contained in this chapter which are exclusively
applicable to trading in Corn. (08/01/98)
C1004.01 Unit of Trading - (see 1004.00) (08/01/98)
C1005.01 Months Traded in - (see 1005.01A) (08/01/98)
C1006.01 Price Basis - (see 1006.00 and 1006.01) (08/01/98)
C1007.01 Hours of Trading - (see 1007.00 and 1007.02) (08/01/98)
C1008.01 Trading Limits - (see 1008.01 and 1008.02) (08/01/98)
C1009.01 Last Day of Trading - (see 1009.02) (08/01/98)
C1010.01 Margin Requirements - (see 431.03) (08/01/98)
C1012.01 Position Limits and Reportable Positions - (see 425.01) (08/01/98)
Ch10C Delivery Procedures
C1036.00 Grade Differentials - (see 1036.00) (08/01/98)
C1036.01 Location Differentials - Corn for shipment from regular shipping
stations located within the Chicago Switching District or the Burns Harbor,
Indiana Switching District may be delivered in satisfaction of Corn futures
contracts at contract price, subject to the differentials for class and grade
outlined above. Corn for shipment from regular shipping stations located within
the Lockport-Seneca Shipping District may be delivered in satisfaction of Corn
futures contracts at a premium of 2 cents per bushel over contract price,
subject to the differentials for class and grade outlined above. Corn for
shipment from regular shipping stations located within the Ottawa-Chillicothe
Shipping District may be delivered in satisfaction of Corn futures contracts at
a premium of 2 1/2 cents per bushel over contract price, subject to the
differentials for class and grade outlined above. Corn for shipment from regular
shipping stations located within the Peoria-Pekin Shipping District may be
delivered in satisfaction of Corn futures contracts at a premium of 3 cents per
bushel over contract price, subject to the differentials for class and grade
outlined above. (08/01/98)
C1038.01 Grades- (see 1038.00 and 1038.01) (08/01/98)
*C1041.01 Delivery Points - Corn Shipping Certificates shall specify shipment
from one of the warehouses or shipping stations currently regular for delivery
and located in one of the following territories:
A. Chicago and Burns Harbor, Indiana Switching District - When used in
these Rules and Regulations, the Chicago Switching District will be
that area geographically defined by Tariff ICC WTL 8020-Series and
that portion of the Illinois Waterway at or above river mile 304 which
includes the Calumet Sag Channel and the Chicago Sanitary & Ship
Canal. When used in these Rules and Regulations, Burns Harbor, Indiana
Switching District will be that area geographically defined by the
boundaries of Burns Waterway Harbor at Burns Harbor, Indiana which is
owned and operated by the Indiana Port Commission.
B. Lockport-Seneca Shipping District - When used in these Rules and
Regulations, the Lockport-Seneca Shipping District will be that
portion of the Illinois Waterway below river mile 304 at the junction
of the Calumet Sag Channel and the Chicago Sanitary & Ship Canal and
above river mile 244.6 at the Marseilles Lock and Dam. [Shipping
stations within the Lockport-Seneca District must deliver 5,000 bushel
shipping certificates of a like kind and quality of grain in multiples
of 55,000 bushels against the futures contracts.]
C. Ottawa-Chillicothe Shipping District - When used in these Rules and
Regulations, the Ottawa-Chillicothe Shipping District will be that
portion of the Illinois Waterway below river mile 244.6 at the
Marseilles Lock and Dam and at or above river mile 170 between
Chillicothe and Peoria, IL. [Shipping stations within the Ottawa-
Chillicothe Shipping District must deliver 5,000 bushel shipping
certificates of a like kind and quality of grain in multiples of
55,000 bushels against the futures contracts.]
D. Peoria-Pekin Shipping District - When used in these Rules and
Regulations, the Peoria-Pekin Shipping District will be that portion
of the Illinois Waterway below river mile 170 between Chillicothe and
Peoria, IL and at or above river mile 151 at Pekin, IL. [Shipping
stations within the Peoria-Pekin Shipping District must deliver 5,000
bushel shipping certificates of a like kind and quality of grain in
multiples of 55,000 bushels against the futures contracts.] (12/01/00)
*Deletions bracketed for November 2001 and subsequent contracts.
C1043.01 Deliveries by Corn Shipping Certificate - (see 1043.01) (08/01/98)
C1043.02 Registration of Corn Shipping Certificates - (see 1043.02) (08/01/98)
C1043.03 Reissuance of Shipping Certificates - (see 1043.03) (08/01/98)
C1044.01 Certificate Format - The following form of Corn Shipping Certificates
shall be used with
proper designation, indicating shipping station.
BOARD OF TRADE OF THE CITY OF CHICAGO
CORN SHIPPING CERTIFICATE FOR DELIVERY IN SATISFACTION OF CONTRACT FOR 5,000
BUSHELS OF CORN
The certificate not valid unless registered by the Registrar of the Board of
Trade of the City of Chicago.
________________________________________________________________________________
____________________________________________Corn
(grade)
Shipping Station
of______________________________________________________________________________
__________________________
Located at
________________________________________________________________________________
_____________________________________
Registered total daily rate of loading of ___________________________________
bushels.
Total rate of loading per day shall be in accordance with Regulation 1081.01
(12). A premium charge of $ ________ cents per bushel per calendar day for
each day is to be assessed starting the day after registration by the Registrar
of this Certificate through the business day loading is complete.
For value received and receipt of this document properly endorsed and lien for
payment of premium charges the undersigned shipper, regular for delivery under
the Rules and Regulations of the Board of Trade of the City of Chicago, hereby
agrees to deliver 5,000 bushels of Corn in bulk conforming the standards of the
Board of Trade of the City of Chicago and ship said Corn in accordance with
orders of the lawful owner of this document and in accordance with Rules and
Regulations of the Board of Trade of the City of Chicago. Delivery shall be by
water or rail conveyance according to the registered loading capability of the
shipper.
Signed at ____________________________________________________ this
_________________________________________________________
day of ________________________________, 20 ______________
-- Chicago, IL or Burns Harbor, IN Switching District
-- Lockport-Seneca Shipping District
-- Ottawa-Chillicothe Shipping District
-- Peoria-Pekin Shipping District
By ______________________________________________________
Authorized Signature of Issuer
Registration date _________________________________
Registration's Number _______________________________________
Registrar for Corn
Board of Trade of the City of Chicago
Registration canceled for purpose of shipment of Corn by owner of certificate or
by issuer of certificate for purpose of withdrawal of certificate.
Cancellation Date
__________________________________________________________________
(Registrar)
All premium charges have been paid on Corn covered by this certificate from date
of registration, not counting date of registration but counting date of payment.
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Delivery of this Corn Shipping Certificate to issuer is conditioned upon loading
of Corn in accordance with Rules and Regulations of the Board of Trade of the
City of Chicago and a lien is claimed until all loadings are complete and proper
shipping documents presented accompanying demand draft for freight and premium
charges due which I (we) agree to honor upon presentation.
______________________________________________________________
Owner of this Corn Shipping
Certificate or his duly authorized agent
Date _________________, 20____________ (03/01/00)
C1046.01 Location for Buying or Selling Delivery - (see 1046.00A) (08/01/98)
Instruments
C1047.01 Delivery Notices - (see 1047.01) (08//01/98)
C1048.01 Method of Delivery - (see 1048.01) (08/01/98)
C1049.01 Time of Delivery, Payment, Form of Delivery - (see 1049.00) (08/01/98)
Notice
C1049.02 Time of Issuance of Delivery Notice - (see 1049.01) (08/01/98)
C1049.03 Buyer's Report of Eligibility to Receive Delivery' - (see 1049.02)
(08/01/98)
C1049.04 Seller's Invoice to Buyers' - (see 1049.03) (08/01/98)
C1049.05 Payment - (see 1049.04) (08/01/98)
C1050.01 Duties of Members - (see 1050.00) (08/01/98)
C1051.01 Office Deliveries Prohibited - (see 1051.01)
C1054.01 Failure to Accept Delivery - (see 1054.00 and 1054.00A) (08/01/98)
*C1056.01 Payment of Premium Charges - To be valid for delivery on futures
contracts, all shipping certificates covering Corn under obligation for shipment
must indicate the applicable premium charge. No shipping certificates shall be
valid for delivery on futures contracts unless the premium charges on such Corn
shall have been paid up to and including the 18th calendar day of the preceding
month, and such payment endorsed on the shipping certificate. Unpaid accumulated
premium charges at the posted rate applicable to the warehouse or shipping
station where the grain under obligation for shipment shall be allowed and
credited to the buyer by the seller to and including day of delivery. Further,
no shipping certificate shall be valid for delivery if the shipping certificate
has expired prior to delivery or has an expiration date in the month in which
delivered.
If premium charges are not paid on-time up to and including the 18th calendar
day preceding the delivery months of March, July and September and by the first
calendar day of each of these delivery months, a late charge will apply. The
late charge will be an amount equal to the total unpaid accumulated premium
charges rate multiplied by the "prime interest rate" in effect on the day that
the accrued premium charges are paid plus a penalty of 5 percentage points, all
multiplied by the number of calendar days that premium is overdue, divided by
360 days. The terms "prime interest rate" shall mean the lowest of the rates
announced by each of the following four banks at Chicago, Illinois, as its
"prime rate": Bank of America-Illinois. The First National Bank of Chicago,
Harris Trust & Savings Bank, and the Northern Trust Company.
[The premium charges on Corn for delivery from regular shippers within the
Chicago switching district or the Burns Harbor, Indiana Switching District shall
not exceed 12/100 of one cent per bushel per day.]
[The premium charges on Corn for delivery from regular shippers within the
Lockport-Seneca Shipping District shall not exceed 10/100 of one cent per bushel
per day.]
[The premium charges on Corn for delivery from regular shippers within the
Ottawa-Chillicothe Shipping District shall not exceed 10/100 of one cent per
bushel per day.]
[The premium charges on Corn for delivery from regular shippers within the
Ottawa-Chillicothe Shipping District shall not exceed 10/100 of one cent per
bushel per day.]
[The premium charges on Corn for delivery from regular shippers within the
Peoria-Pekin Shipping District shall not exceed 10/100 of one cent per bushel
per day.]
The premium charges on Corn for delivery from regular shippers shall not exceed
-------------------------------------------------------------------------------
15/100 of one cent per bushel per day. (12/01/00)
--------------------------------------
*Additions underlined; deletions bracketed for November 2001 and subsequent
contracts.
Ch10C Regularity of Issuers of Shipping Certificates
*C1081.01 Regularity of Warehouses and Issuers of Shipping Certificates -Persons
operating grain warehouses or shippers who desire to have such warehouses or
shipping stations made regular for the delivery of grain under the Rules and
Regulations shall make application for an initial Declaration of Regularity on a
form prescribed by the Exchange prior to May 1, 1994, and every even year
thereafter, for a two-year term beginning July 1, 1994, and every even year
thereafter, and at any time during a current term for the balance of that term.
Regular grain warehouses or shippers who desire to increase their regular
capacity during a current term shall make application for the desired amount of
total regular capacity on the same form. Initial regularity for the current term
and increases in regularity shall be effective either thirty days after a notice
that a bona fide application has been received is posted on the floor or the
exchange, or the day after the application is approved by the Exchange,
whichever is later. Applications for a renewal of regularity shall be made prior
to May 1, 1994, and every even year thereafter, for the respective years
beginning July 1, 1994, and every even year thereafter, and shall be on the same
form.
The following shall constitute the requirements and conditions for
regularity:
(1) The warehouse or shipping station making application shall be
inspected by the Registrar or the United States Department of
Agriculture. Where application is made to list as regular a warehouse
which is not regular at the time of such application, the applicant
may be required to remove all grain from the warehouse and to permit
the warehouse to be inspected and the grain graded, after which such
grain may be returned to the warehouse and receipts issued therefor.
The operator of a shipping station issuing Corn Shipping Certificates shall
limit the number of Shipping Certificates issued to an amount not to
exceed:
(a) [30] 20 times his registered total daily rate of loading barges,
--
or in the case of Chicago, Illinois and Burns Harbor, Indiana
-------------------------------------------------------------
Switching Districts, his registered storage capacity,
-----------------------------------------------------
(b) and a value greater than 25 percent of the operator's net
---
worth[,] .
-
[(c) and in the case of Chicago, Illinois and Burns Harbor, Indiana
Switching Districts only, his registered storage capacity.]
The shipper issuing Corn Shipping Certificates shall register his total daily
rate of loading barges at his maximum 8 hour loadout capacity in
amount not less than:
(a) one barge per day at each shipping station within the Lockport-Seneca
Shipping District, within the Ottawa-Chillicothe Shipping District,
within the Peoria-Pekin Shipping District, within the Havana-Grafton
Shipping District, and within the St. Louis-East St. Louis and Alton
Switching Districts, and
(b) three barges per day at each shipping station in the Chicago, Illinois
and Burns Harbor, Indiana Switching District.
(2) Shippers located in the Chicago, Illinois and Burns Harbor, Indiana
Switching District shall be connected by railroad tracks with one or
more railway lines.
10C81.01(3) through 10C81.01(12)G(8) - (see 1081.01(3) through 1081.01(12)G(8))
*Additions underlined; deletions bracketed for November 2001 and subsequent
contracts.
10C81.01(12)G(9) In the event that it has been announced that river traffic will
be obstructed for a period of fifteen days or longer as a result of one of the
conditions of impossibility listed in regulation 1081.01(12)(G)(8) and in the
event that the obstruction will affect a majority of regular shipping stations,
then the following barge load-out procedures for Corn shall apply to shipping
stations upriver from the obstruction:
(a) The maker and taker of delivery may negotiate mutually agreeable
terms of performance.
(b) If the maker and/or the taker elect not to negotiate mutually
agreeable terms of performance, then the maker is obligated to
provide the same quantity and like quality of grain pursuant to
the terms of the shipping certificate(s) with the following
exceptions and additional requirements:
(i) The maker must provide loaded barge(s) to the taker on the
Illinois River between the lowest closed lock and St.
Louis, inclusive, or on the Mid-Mississippi River between
Lock 11 at Dubuque, Iowa and St. Louis, inclusive.
(ii) The loaded barge(s) provided to the taker must have a
value equivalent to C.I.F. NOLA, with the maker of
delivery responsible for the equivalent cost, insurance
and freight.
(iii) The taker of delivery shall pay the maker 18 cents per
bushel for Chicago and Burns Harbor Switching District
shipping certificates, 16 cents per bushel for Lockport-
Seneca District shipping certificates, 15 1/2 cents per
bushel for Ottawa-Chillicothe District shipping
certificates, and 15 cents per bushel for Peoria-Pekin
District shipping certificates, as a reimbursement for the
cost of barge freight.
(c) In the event that the obstruction or condition of
impossibility listed in regulation 1081.01(12)(G)(8) will
affect a majority of regular shipping stations, but no
announcement of the anticipated period of obstruction is
made, then shipment may be delayed for the number of days
that such impossibility prevails.
10C81.01(13) Location - For the delivery of Corn, regular warehouses or shipping
stations may be located within the Chicago Switching District or within the
Burns Harbor, Indiana Switching District or within the Lockport-Seneca Shipping
District or within the Ottawa-Chillicothe Shipping District or within the
Peoria-Pekin Shipping District.
No such warehouse or shipping station within the Chicago Switching
District shall be declared regular unless it is conveniently approachable by
vessels of ordinary draft and has customary shipping facilities. Ordinary draft
shall be defined as the lesser of (1) channel draft as recorded in the Lake
Calumet Harbor Draft Gauge, as maintained by the Corps of Engineers, U.S. Army,
minus one (1) foot, or (2) 20 feet.
Delivery in Burns Harbor must be made "in store" in regular elevators or by
shipping certificate at regular shipping stations providing water loading
facilities and maintaining water depth equal to normal seaway draft of 27 feet.
In addition, deliveries of grain may be made in regular elevators or shipping
stations within the Burns Harbor Switching District PROVIDED that:
(a) When grain represented by shipping certificates is ordered out
for shipment by a barge, it will be the obligation of the party
making delivery to protect the barge freight rate from the
Chicago Switching District (i.e. the party making delivery and
located in the Burns Harbor Switching District will pay the party
taking delivery an amount equal to all expenses for the movement
of the barge from the Chicago Switching District, to the Burns
Harbor Switching District and the return movement back to the
Chicago Switching District).
If inclement weather conditions make the warehouse or shipping
station located in the Burns Harbor Switching District unavailable
for barge loadings for a period of five or more calendar days, the
party making delivery will make grain available on the day following
this five calendar day period to load into a barge at one mutually
agreeable water warehouse or shipping station located in the Chicago
Switching District; PROVIDED that the party making delivery is
notified on the first day of that five-day period of inclement
weather that the barge is available for movement but cannot be moved
from the Chicago Switching District to the Burns Harbor Switching
District, and is requested on the last day of this five day calendar
period in which the barge cannot be moved.
(b) When grain represented by shipping certificates is ordered out for
shipment by vessel, and the party taking delivery is a recipient of a
split delivery of grain between a warehouse or shipping station
located in Burns Harbor and a warehouse or shipping station in
Chicago, and the grain in the Chicago warehouse or shipping station
will be loaded onto this vessel; it will be the obligation of the
party making delivery at the request of the party taking delivery to
protect the holder of the shipping certificates against any
additional charges resulting from loading at one berth in the Burns
Harbor Switching District and at one berth in the Chicago Switching
District as compared to a single berth loading at one location. The
party making delivery, at his option, will either make the grain
available at one water warehouse or shipping station operated by the
party making delivery and located in the Chicago Switching District
for loading onto the vessel, make grain available at the warehouse or
shipping station in Burns Harbor upon the surrender of shipping
certificates issued by other regular elevators or shipping stations
located in the Chicago Switching District at the time vessel loading
orders are issued, or compensate the party taking delivery in an
amount equal to all applicable expenses, including demurrage charges,
if any, for the movement of the vessel between a berth in the other
switching district. On the day that the grain is ordered out for
shipment by vessel, the party making delivery will declare the
regular warehouse or shipping station in which the grain will be
available for loading.
Delivery within the Lockport-Seneca Shipping District or within the
Ottawa-Chillicothe Shipping District or within the Peoria-Pekin
Shipping District or within the Havana-Grafton Shipping District must
be made at regular shipping stations providing water loading
facilities and maintaining water depth equal to the draft of the
Illinois River maintained by the Corp of Engineers.
10C81.01(14) Billing - (see 1081.01(14)A and 1081.01(14)F)
10C81.01(15) through 10C81.01(17) - (see 1081.01(15) through 1081.01(17))
(12/01/00)
C1081.01A Inspection - (see 1081.01A) (08/01/98)
C1081.01B Billing When Grain is Loaded Out - (see 1081.01B) (08/01/98)
C1081.01C Car of Specified Capacity - (see 1081.01C) (08/01/98)
C1082.01 Insurance - (see 1082.00) (08/01/98)
C1083.01 Variation Allowed - (see 1083.00) (08/01/98)
C1083.02 Excess or Deficiency in Quantity - (see 1083.01) (08/01/98)
C1084.01 Revocation, Expiration or Withdrawal of Regularity - (see 1084.01)
(08/01/98)
C1085.01 Application for Declaration of Regularity - (see 1085.01) (08/01/98)
C1086.01 Federal Warehouses - (see 1086.01) (08/01/98)
[Enlarge/Download Table]
=============================================================================================
Chapter 10S
Soybean Futures
=============================================================================================
Ch10S Trading Conditions..........................................................
S1001.01 Application of Regulations.........................................
S1004.01 Unit of Trading....................................................
S1005.01 Months Traded in...................................................
S1006.01 Price Basis........................................................
S1007.01 Hours of Trading...................................................
S1008.01 Trading Limits.....................................................
S1009.01 Last Day of Trading................................................
S1010.01 Margin Requirements................................................
S1012.01 Position Limits and Reportable Positions...........................
Ch10S Delivery Procedures.........................................................
S1036.00 Grade Differentials................................................
S1036.01 Location Differentials.............................................
S1038.01 Grades.............................................................
S1041.01 Delivery Points....................................................
S1043.01 Deliveries.........................................................
S1043.02 Registration of Soybean Shipping Certificates......................
S1043.03 Reissuance of Shipping Certificates................................
S1044.01 Certificate Format.................................................
S1046.01 Location for Buying or Selling Delivery Instruments................
S1047.01 Delivery Notices...................................................
S1048.01 Method of Delivery.................................................
S1049.01 Time of Delivery, Payment, Form of Delivery Notice.................
S1049.02 Time of Issuance of Delivery Notice................................
S1049.03 Buyer's Report of Eligibility to Receive
Delivery...........................................................
S1049.04 Seller's Invoice to Buyers.........................................
S1049.05 Payment............................................................
S1050.01 Duties of Members..................................................
S1051.01 Office Deliveries Prohibited.......................................
S1054.01 Failure to Accept Delivery.........................................
S1056.01 Payment of Premium Charges.........................................
Ch10S Regularity of Issuers of Shipping...........................................
S1081.01 Regularity of Warehouses and Issuers of Shipping Certificates......
S1081.01A Inspection.........................................................
S1081.01B Billing When Grain is Loaded Out...................................
S1081.01C Car of Specified Capacity..........................................
S1082.01 Insurance..........................................................
S1083.01 Variation Allowed..................................................
S1083.02 Excess or Deficiency in Quantity...................................
S1084.01 Revocation, expiration or Withdrawal of Regularity.................
S1085.01 Application for Declaration of Regularity..........................
S1086.01 Federal Warehouses.................................................
================================================================================
Chapter 10S
Soybean Futures
================================================================================
Ch10S Trading Conditions
S1001.01 Application of Regulations - Transactions in Soybean futures shall be
subject to the General Rules of the Association as far as applicable and shall
also be subject to Regulations contained in this chapter which are exclusively
applicable to trading in Soybeans.
S1004.01 Unit of Trading - (see 1004.00) (08/01/98)
S1005.01 Months Traded in - (see 1005.01A) (08/01/98)
S1006.01 Price Basis - (see 1006.00 and 1006.01) (08/01/98)
S1007.01 Hours of Trading - (see 1007.00 and 1007.02) (08/01/98)
S1008.01 Trading Limits - (see 1008.01 and 1008.02) (08/01/98)
S1009.01 Last Day of Trading - (see 1009.02) (08/01/98)
S1010.01 Margin Requirements - (see 431.03) (08/01/98)
S1012.01 Position Limits and Reportable Positions - (see 425.01) (08/01/98)
Ch10S Delivery Procedures
-------------------------
S1036.00 Grade Differentials - (see 1036.00) (08/01/98)
S1036.01 Location Differentials - Soybeans for shipment from regular
shipping stations located within the Chicago Switching District or the Burns
Harbor, Indiana Switching District may be delivered in satisfaction of
Soybean futures contracts at contract price, subject to the differentials for
class and grade outlined above. Soybeans for shipment from regular shipping
stations located within the Lockport-Seneca Shipping District may be
delivered in satisfaction of soybean futures contracts at a premium of 2
cents per bushel over contract price, subject to the differentials for class
and grade outlined above. Soybeans for shipment from regular shipping
stations located within the Ottawa-Chillicothe Shipping District may be
delivered in satisfaction of Soybean futures contracts at a premium of 2 1/2
cents per bushel over contract price, subject to the differentials for class
and grade outlined above. Soybeans for shipment from regular shipping
stations located within the Peoria-Pekin Shipping District may be delivered
in satisfaction of Soybean futures contracts at a premium of 3 cents per
bushel over contract price, subject to the differentials for class and grade
outlined above. Soybeans for shipment from regular shipping stations located
within the Havana-Grafton Shipping District may be delivered in satisfaction
of soybean futures contracts at a premium of 3 1/2 cents per bushel over
contract price, subject to the differentials for class and grade outlined
above. Soybeans for shipment from regular shipping stations located in the
St. Louis-East St. Louis and Alton Switching Districts may be delivered in
satisfaction of Soybean futures contracts at a premium of 6 cents per bushel
over contract price, subject to the differentials for class and grade
outlined above. (08/01/98)
S1038.01 Grades - (see 1038.00 and 1038.01) (08/01/98)
*S1041.01 Delivery Points - Soybean Shipping Certificates shall specify shipment
from one of the warehouses or shipping stations currently regular for delivery
and located in one of the following territories:
A. Chicago and Burns Harbor, Indiana Switching District - When used in
these Rules and Regulations, the Chicago Switching District will be
that area geographically defined by Tariff ICC WTL 8020-Series and
that portion of the Illinois Waterway at or above river mile 304 which
includes the Calumet Sag Channel and the Chicago Sanitary & Ship
Canal. When used in these Rules and Regulations, Burns Harbor,
Indiana Switching District will be that area geographically defined by
the boundaries of Burns Waterway Harbor at Burns Harbor, Indiana which
is owned and operated by the Indiana Port Commission.
B. Lockport-Seneca Shipping District - When used in these Rules and
Regulations, the Lockport-Seneca Shipping District will be that
portion of the Illinois Waterway below river mile 304 at the junction
of the Calumet Sag Channel and the Chicago Sanitary & Ship Canal and
above river mile 244.6 at the Marseilles Lock and Dam. [Shipping
stations within the Lockport-Seneca District must deliver 5,000
bushel shipping certificates of a like kind and quality of grain in
multiples of 55,000 bushels against the futures contracts.]
C. Ottawa-Chillicothe Shipping District - When used in these Rules and
Regulations, the Ottawa-Chillicothe Shipping District will be that
portion of the Illinois Waterway below river mile 244.6 at the
Marseilles Lock and Dam and at or above river mile 170 between
Chillicothe and Peoria, IL. [Shipping stations within the Ottawa-
Chillicothe Shipping District must deliver 5,000 bushel shipping
certificates of a like kind and quality of grain in multiples of
55,000 bushels against the futures contracts.]
*Deletions bracketed for November 2001 and subsequent contracts.
Ch10S Delivery Procedures
-------------------------
D. Peoria-Pekin Shipping District - When used in these Rules and
Regulations, the Peoria-Pekin Shipping District will be that portion
of the Illinois Waterway below river mile 170 between Chillicothe and
Peoria, IL and at or above river mile 151 at Pekin, IL. [Shipping
stations within the Peoria-Pekin Shipping District must deliver 5,000
bushel shipping certificates of a like kind and quality of grain in
multiples of 55,000 bushels against the futures contracts.]
E. Havana-Grafton Shipping District - When used in these Rules and
Regulations, the Havana-Grafton Shipping District will be that portion
of the Illinois Waterway below river mile 151 at Pekin, IL to river
mile 0 at Grafton, IL. [Shipping stations within the Havana-Grafton
Shipping District must deliver 5,000 bushel shipping certificates of a
like kind and quality of grain in multiples of 55,000 bushels against
the futures contracts.]
F. St. Louis-East St. Louis and Alton Switching Districts - When used in
these Rules and Regulations, St. Louis-East St. Louis and Alton
Switching Districts will be that portion of the upper Mississippi
River below river mile 218 at Grafton, IL and above river mile 170 at
Jefferson Barracks Bridge in south St. Louis, MO. [Shipping stations
on the St. Louis-East St. Louis and Alton Switching Districts must
deliver 5,000 bushel shipping certificates of a like kind and quality
of grain in multiples of 55,000 bushels against the futures
contracts.] (12/01/00)
S1043.01 Deliveries by Soybean Shipping Certificate - (see 1043.01) (08/01/98)
S1043.02 Registration of Soybean Shipping Certificates - (see 1043.02)
(08/01/98)
S1043.03 Reissuance of Shipping Certificates - (see 1043.03) (08/01/98)
S1044.01 Certificate Format - The following form of Soybean Shipping
Certificates shall be used with proper designation, indicating shipping station.
BOARD OF TRADE OF THE CITY OF CHICAGO
SOYBEAN SHIPPING CERTIFICATE FOR DELIVERY IN SATISFACTION OF CONTRACT FOR 5,000
BUSHELS OF SOYBEANS
The certificate not valid unless registered by the Registrar of the Board of
Trade of the City of Chicago.
________________________________________________________________________________
____________________________________________Soybeans
(grade)
Shipping Station
of______________________________________________________________________________
__________________________
Located at
________________________________________________________________________________
_________________________________
Registered total daily rate of loading of ___________________________________
bushels.
Total rate of loading per day shall be in accordance with Regulation 1081.01
(12) G and H. A premium charge of $ ________cents per bushel per calendar day
for each day is to be assessed starting the day after registration by the
Registrar of this Certificate through the business day loading is complete.
For value received and receipt of this document properly endorsed and lien for
payment of premium charges the undersigned shipper, regular for delivery under
the Rules and Regulations of the Board of Trade of the City of Chicago, hereby
agrees to deliver 5,000 bushels of Soybeans in bulk conforming the standards of
the Board of Trade of the City of Chicago and ship said Soybeans in accordance
with accordance with orders of the lawful owner of this document and in
accordance with Rules and Regulations of the Board of Trade of the City of
Chicago. Delivery shall be by water or rail conveyance according to the
registered loading capability of the shipper.
Signed at ____________________________________________________ this
_________________________________________________________
day of ________________________________, 20 ______________
Ch10S Delivery Procedures
-------------------------
-- Chicago, IL or Burns Harbor, IN Switching District
-- Lockport-Seneca Shipping District
-- Ottawa-Chillicothe Shipping District
-- Peoria-Pekin Shipping District
-- Havana-Grafton Shipping District
-- St. Louis-East St. Louis and Alton Switching Districts
By ________________________________________________________
Authorized Signature of Issuer
Registration date _________________________________
Registration's Number ______________________________________
Registrar for Soybeans
Board of Trade of the City of Chicago
Registration canceled for purpose of shipment of Soybeans by owner of
certificate or by issuer of certificate for purpose of withdrawal of
certificate.
Cancellation Date
__________________________________________________________________
(Registrar)
All premium charges have been paid on Soybeans covered by this certificate from
date of registration, not counting date of registration but counting date of
payment.
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Date ______________________ by ______________________________
Delivery of this Soybean Shipping Certificate to issuer is conditioned upon
loading of Soybeans in accordance with Rules and Regulations of the Board of
Trade of the City of Chicago and a lien is claimed until all loadings are
complete and proper shipping documents presented accompanying demand draft for
freight and premium charges due which I (we) agree to honor upon presentation.
----------------------------------------------------------------------------
Owner of this Soybean Shipping
Certificate or his duly authorized agent
Date _________________, 20____________ (03/01/00)
S1046.01 Location for Buying or Selling Delivery Instruments - (see 1046.00A)
(08/01/98)
S1047.01 Delivery Notices - (see 1047.01) (08//01/98)
S1048.01 Method of Delivery - (see 1048.01) (08/01/98)
S1049.01 Time of Delivery, Payment, Form of Delivery Notice - (see 1049.00)
(08/01/98)
S1049.02 Time of Issuance of Delivery Notice - (see 1049.01) (08/01/98)
S1049.03 Buyer's Report of Eligibility to Receive Delivery - (see 1049.02)
(08/01/98)
S1049.04 Seller's Invoice to Buyers - (see 1049.03) (08/01/98)
S1049.05 Payment - (see 1049.04) (08/01/98)
S1050.01 Duties of Members - (see 1050.00) (08/01/98)
S1051.01 Office Deliveries Prohibited - (see 1051.01)
S1054.01 Failure to Accept Delivery - (see 1054.00 and 1054.00A) (08/01/98)
*S1056.01 Payment of Premium Charges - To be valid for delivery on futures
contracts, all shipping certificates covering Soybeans under obligation for
shipment must indicate the applicable premium charge. No shipping certificates
shall be valid for delivery on futures contracts unless the premium charges on
such Soybeans shall have been paid up to and including the 18th calendar day of
the preceding month, and such payment endorsed on the shipping certificate.
Unpaid accumulated
Ch10S Delivery Procedures
-------------------------
premium charges at the posted rate applicable to the warehouse or shipping
station where the grain under obligation for shipment shall be allowed and
credited to the buyer by the seller to and including day of delivery. Further,
no shipping certificate shall be valid for delivery if the shipping certificate
has expired prior to delivery or has an expiration date in the month in which
delivered.
If premium charges are not paid on-time up to and including the 18th calendar
day preceding the delivery months of March, July and September and by the first
calendar day of each of these delivery months, a late charge will apply. The
late charge will be an amount equal to the total unpaid accumulated premium
charges rate multiplied by the "prime interest rate" in effect on the day that
the accrued premium charges are paid plus a penalty of 5 percentage points, all
multiplied by the number of calendar days that premium is overdue, divided by
360 days. The terms "prime interest rate" shall mean the lowest of the rates
announced by each of the following four banks at Chicago, Illinois, as its
"prime rate": Bank of America-Illinois. The First National Bank of Chicago,
Harris Trust & Savings Bank, and the Northern Trust Company.
[The premium charges on Soybeans for delivery from regular shippers within the
Chicago switching district or the Burns Harbor, Indiana Switching District shall
not exceed 12/100 of one cent per bushel per day.]
[The premium charges on Soybeans for delivery from regular shippers within the
Lockport-Seneca Shipping District shall not exceed 10/100 of one cent per bushel
per day.]
[The premium charges on Soybeans for delivery from regular shippers within the
Ottawa-Chillicothe Shipping District shall not exceed 10/100 on one cent per
bushel per day.]
[The premium charges on Soybeans for delivery from regular shippers within the
Peoria-Pekin Shipping District shall not exceed 10/100 of one cent per bushel
per day.]
[The premium charges on Soybeans for delivery from regular shippers within the
Havana-Grafton Shipping District shall not exceed 10/100 of one cent per
bushel.]
[The premium charges on Soybeans for delivery from regular shippers in the St.
Louis-East St. Louis and Alton Switching Districts shall not exceed 10/100 of
one cent per bushel per day.]
The premium charges on Soybeans for delivery from regular shippers shall not
----------------------------------------------------------------------------
exceed 15/100 of one cent per bushel per day.
---------------------------------------------
*Additions underlined; deletions bracketed for November 2001 subsequent
contracts.
Ch10S Delivery Procedures
-------------------------
Ch10S Regularity of Issuers of Shipping
*S1081.01 Regularity of Warehouses and Issuers of Shipping Certificates -
Persons operating grain warehouses or shippers who desire to have such
warehouses or shipping stations made regular for the delivery of grain under the
Rules and Regulations shall make application for an initial Declaration of
Regularity on a form prescribed by the Exchange prior to May 1, 1994, and every
even year thereafter, for a two-year term beginning July 1, 1994, and every even
year thereafter, and at any time during a current term for the balance of that
term. Regular grain warehouses or shippers who desire to increase their regular
capacity during a current term shall make application for the desired amount of
total regular capacity on the same form. Initial regularity for the current term
and increases in regularity shall be effective either thirty days after a notice
that a bona fide application has been received is posted on the floor or the
exchange, or the day after the application is approved by the Exchange,
whichever is later. Applications for a renewal of regularity shall be made prior
to May 1, 1994, and every even year thereafter, for the respective years
beginning July 1, 1994, and every even year thereafter, and shall be on the same
form.
The following shall constitute the requirements and conditions for
regularity:
(1) The warehouse or shipping station making application shall be
inspected by the Registrar or the United States Department of
Agriculture. Where application is made to list as regular a warehouse
which is not regular at the time of such application, the applicant
may be required to remove all grain from the warehouse and to permit
the warehouse to be inspected and the grain graded, after which such
grain may be returned to the warehouse and receipts issued therefor.
The operator of a shipping station issuing Soybean Shipping Certificates
shall limit the number of Shipping Certificates issued to an amount not to
exceed:
(a) [30] 20 times his registered total daily rate of loading barges,
--
or in the case of Chicago, Illinois and Burns Harbor, Indiana
-------------------------------------------------------------
Switching Districts, his registered storage capacity,
-----------------------------------------------------
(b) and a value greater than 25 percent of the operator's net worth
---
[,] .
-
[(c) and in the case of Chicago, Illinois and Burns Harbor, Indiana
Switching Districts only, his registered storage capacity.]
The shipper issuing Soybean Shipping Certificates shall register his total
daily rate of loading barges at his maximum 8 hour loadout capacity in
amount not less than:
(a) one barge per day at each shipping station within the Lockport-Seneca
Shipping District, within the Ottawa-Chillicothe Shipping District,
within the Peoria-Pekin Shipping District, within the Havana-Grafton
Shipping District, and within the St. Louis-East St. Louis and Alton
Switching Districts, and
(b) three barges per day at each shipping station in the Chicago, Illinois
and Burns Harbor, Indiana Switching District.
(2) Shippers located in the Chicago, Illinois and Burns Harbor, Indiana
Switching District shall be connected by railroad tracks with one or
more railway lines.
10S81.01(3) through 10S81.01(12)G(8) - (see 1081.01(3) through 1081.01(12)G(8))
*Additions underlined; deletions bracketed for November 2001 and subsequent
contracts.
Ch10S Delivery Procedures
-------------------------
10S81.01(12)G(9) In the event that it has been announced that river traffic
will be obstructed for a period of fifteen days or longer as a result of one of
the conditions of impossibility listed in regulation 1081.01(12)(G)(8) and in
the event that the obstruction will affect a majority of regular shipping
stations, then the following barge load-out procedures for soybeans shall apply
to shipping stations upriver from the obstruction:
(a) The maker and taker of delivery may negotiate mutually
agreeable terms of performance.
(b) If the maker and/or the taker elect not to negotiate
mutually agreeable terms of performance, then the maker
is obligated to provide the same quantity and like
quality of grain pursuant to the terms of the shipping
certificate(s) with the following exceptions and
additional requirements:
(i) The maker must provide loaded barge(s) to the
taker on the Illinois River between the lowest
closed lock and St. Louis, inclusive, or on the
Mid-Mississippi River between Lock 11 at
Dubuque, Iowa and St. Louis, inclusive.
(ii) The loaded barge(s) provided to the taker must
have a value equivalent to C.I.F. NOLA, with the
maker of delivery responsible for the equivalent
cost, insurance and freight.
(iii) The taker of delivery shall pay the maker 18
cents per bushel for Chicago and Burns Harbor
Switching District shipping certificates, 16
cents per bushel for Lockport-Seneca District
shipping certificates, 15 1/2 cents per bushel
for Ottawa-Chillicothe District shipping
certificates, 15 cents per bushel for Peoria-
Pekin District shipping certificates, and 14 1/2
cents per bushel for Havana-Grafton District
shipping certificates as a reimbursement for the
cost of barge freight.
(c) In the event that the obstruction or condition of
impossibility listed in regulation 1081.01(12)(G)(8)
will affect a majority of regular shipping stations,
but no announcement of the anticipated period of
obstruction is made, then shipment may be delayed for
the number of days that such impossibility prevails.
10S81.01(13) Location - For the delivery of Soybeans, regular warehouses or
shipping stations may be located within the Chicago Switching District or within
the Burns Harbor, Indiana Switching District or within the Lockport-Seneca
Shipping District or within the Ottawa-Chillicothe Shipping District or within
the Peoria-Pekin Shipping District or within the Havana-Grafton Shipping
District or in the St. Louis-East St. Louis and Alton Switching Districts.
No such warehouse or shipping station within the Chicago Switching
District shall be declared regular unless it is conveniently
approachable by vessels of ordinary draft and has customary shipping
facilities. Ordinary draft shall be defined as the lesser of (1)
channel draft as recorded in the Lake Calumet Harbor Draft Gauge, as
maintained by the Corps of Engineers, U.S. Army, minus one (1) foot, or
(2) 20 feet.
Delivery in Burns Harbor must be made "in store" in regular elevators or
by shipping certificate at regular shipping stations providing water
loading facilities and maintaining water depth equal to normal seaway
draft of 27 feet.
In addition, deliveries of grain may be made in regular elevators or
shipping stations within the Burns Harbor Switching District PROVIDED
that:
(a) When grain represented by shipping certificates is ordered out for
shipment by a barge, it will be the obligation of the party making
delivery to protect the barge freight rate from the Chicago Switching
District (i.e. the party making delivery and located in the Burns
Harbor Switching District will pay the party taking delivery an
amount equal to all expenses for the movement of the barge from the
Chicago Switching District, to the Burns Harbor Switching District
and the return movement back to the
Ch10S Delivery Procedures
-------------------------
Chicago Switching District).
If inclement weather conditions make the warehouse or shipping
station located in the Burns Harbor Switching District unavailable
for barge loadings for a period of five or more calendar days, the
party making delivery will make grain available on the day following
this five calendar day period to load into a barge at one mutually
agreeable water warehouse or shipping station located in the Chicago
Switching District; PROVIDED that the party making delivery is
notified on the first day of that five-day period of inclement
weather that the barge is available for movement but cannot be moved
from the Chicago Switching District to the Burns Harbor Switching
District, and is requested on the last day of this five day calendar
period in which the barge cannot be moved.
(b) When grain represented by shipping certificates is ordered out for
shipment by vessel, and the party taking delivery is a recipient of a
split delivery of grain between a warehouse or shipping station
located in Burns Harbor and a warehouse or shipping station in
Chicago, and the grain in the Chicago warehouse or shipping station
will be loaded onto this vessel; it will be the obligation of the
party making delivery at the request of the party taking delivery to
protect the holder of the shipping certificates against any
additional charges resulting from loading at one berth in the Burns
Harbor Switching District and at one berth in the Chicago Switching
District as compared to a single berth loading at one location. The
party making delivery, at his option, will either make the grain
available at one water warehouse or shipping station operated by the
party making delivery and located in the Chicago Switching District
for loading onto the vessel, make grain available at the warehouse or
shipping station in Burns Harbor upon the surrender of shipping
certificates issued by other regular elevators or shipping stations
located in the Chicago Switching District at the time vessel loading
orders are issued, or compensate the party taking delivery in an
amount equal to all applicable expenses, including demurrage charges,
if any, for the movement of the vessel between a berth in the other
switching district. On the day that the grain is ordered out for
shipment by vessel, the party making delivery will declare the
regular warehouse or shipping station in which the grain will be
available for loading.
Delivery within the Lockport-Seneca Shipping District or within the
Ottawa-Chillicothe Shipping District or within the Peoria-Pekin
Shipping District or within the Havana-Grafton Shipping District must
be made at regular shipping stations providing water loading
facilities and maintaining water depth equal to the draft of the
Illinois River maintained by the Corp of Engineers.
Delivery in the St. Louis-East St. Louis and Alton Switching District
must be made at regular shipping stations providing water loading
facilities and maintaining water depth equal to the draft of the
Mississippi River maintained by the Corp of Engineers.
10S81.01(14) Billing - (see 1081.01(14)A and 1081.01(14)F)
10S81.01(15) through 10S81.01(17) - (see
1081.01(15) through 1081.01(17)) (12/01/00)
S1081.01A Inspection - (see 1081.01A) (08/01/98)
S1081.01B Billing When Grain is Loaded Out - (see 1081.01B) (08/01/98)
S1081.01C Car of Specified Capacity - (see 1081.01C) (08/01/98)
S1082.01 Insurance - (see 1082.00) (08/01/98)
S1083.01 Variation Allowed - (see 1083.00) (08/01/98)
S1083.02 Excess or Deficiency in Quantity - (see 1083.01) (08/01/98)
S1084.01 Revocation, Expiration or Withdrawal of Regularity - (see 1084.01)
(08/01/98)
S1085.01 Application for Declaration of Regularity - (see 1085.01) (08/01/98
S1086.01 Federal Warehouses -(see1086.01) (08/01/98)
S1086.01 Federal Warehouses - (see 1086.01) (08/01/98)
1009S
[Enlarge/Download Table]
========================================================================================
Chapter 11
Soybean Oil
========================================================================================
Ch11 Trading Conditions......................................................
1101.00 Authority......................................................
1102.01 Application of Regulations.....................................
1104.01 Unit of Trading................................................
1105.01 Months Traded In...............................................
1106.01 Price Basis....................................................
1107.01 Hours of Trading...............................................
1108.01 Trading Limits.................................................
1108.01A Trading Limits.................................................
1109.01 Last Day of Trading............................................
1109.02 Trading in the Last Seven Business Days of the Delivery Month..
1110.01 Margin Requirements............................................
1111.01 Disputes.......................................................
1112.01 Position Limits and Reportable Positions.......................
Ch11 Delivery Procedures.....................................................
1136.01 Standards......................................................
1136.02 United States Origin Only......................................
1137.01 Official Chemist's Certificates................................
1138.01 Sampling.......................................................
1139.01 Weighing.......................................................
1140.01 Grading........................................................
1141.01 Delivery Points................................................
1142.01 Deliveries By Warehouse Receipts...............................
1143.01 Registration of Warehouse Receipts.............................
1143.02 Reissuance of Warehouse Receipts...............................
1144.01 Receipt Format.................................................
1145.01 Lost or Destroyed Negotiable Warehouse Receipts................
1146.01 Date of Delivery...............................................
1147.00 Delivery Notice................................................
1147.01 Delivery Notices...............................................
1148.00 Method of Delivery.............................................
1149.00 Time of Delivery, Payment, Form of Delivery Notice.............
1149.02 Buyers' Report of Eligibility to Receive Delivery..............
1149.03 Sellers' Invoice to Buyers.....................................
1149.04 Payment........................................................
1150.00 Duties of Members..............................................
1151.01 Office Deliveries Prohibited...................................
1154.00 Failure to Accept Delivery.....................................
1156.01 Storage Charges................................................
1156.02 Storage, Car Rental, Etc.......................................
1156.03 Fees...........................................................
Ch11 Regularity of Warehouses................................................
1180.01 Duties of Warehouse Operators..................................
1180.01A Responsibility for Furnishing Tank Cars........................
1180.01B Car Ready for Loading..........................................
1180.01C Transit vs. Flat Rate Billing..................................
1180.01D Freight Differentials..........................................
1180.02 Transit Billing................................................
1180.03 Freight Charges................................................
1181.01 Conditions of Regularity.......................................
1181.02 Leasing and Service Arrangements...............................
1184.01 Revocation, Expiration or Withdrawal of Regularity.............
1185.01 Application for Declaration of Regularity......................
1186.01 Regular Shippers...............................................
================================================================================
Chapter 11
Soybean Oil
================================================================================
Ch11 Trading Conditions
1101.00 Authority - On or after January 30, 1950, trading in Crude Soybean Oil
futures may be conducted under such terms and conditions as may be prescribed by
Regulation. 801 (09/01/94)
1102.01 Application of Regulations - Transactions in Crude Soybean Oil futures
(09/01/94) shall be subject to the general rules of the association as far as
applicable and shall also be subject to the Regulations contained in this
Chapter which are exclusively applicable to trading in Crude Soybean Oil. 2000
(09/01/94)
1104.01 Unit of Trading - The unit of trading for Crude Soybean Oil shall be
60,000 pounds. Bids and offers may be accepted in lots of 60,000 pounds or
multiples thereof. For trading purposes, one tank car shall be equivalent to
60,000 pounds. 2003 (09/01/94)
1105.01 Months Traded In - Trading in Crude Soybean Oil may be conducted in the
current month and any subsequent months. 2004 (09/01/94)
1106.01 Price Basis - All prices of Crude Soybean Oil shall be basis Decatur,
Illinois in multiples of 1/100th of one cent per pound. Contracts shall not be
made on any other price basis. 2005 (09/01/94)
1107.01 Hours of Trading - The hours of trading for future delivery in Crude
Soybean Oil shall be from 9:30 a.m. to 1:15 p.m. except that on the last day of
trading in an expiring future the hours with respect to such future shall be
from 9:30 a.m. to 12 o'clock noon subject to the provisions of the second
paragraph of Rule 1007.00. Market shall be opened and closed with a public call
made month by month, conducted by such persons as the Regulatory Compliance
Committee shall direct. 2007 (09/01/94)
1108.01 Trading Limits - (See 1008.01) (09/01/94)
1108.01A Trading Limits - (See 1008.01A) (09/01/94)
1109.01 Last Day of Trading - No trades in Crude Soybean Oil futures
deliverable in the current month shall be made after the business day preceding
the 15/th/ calendar day of that month and any contracts remaining open may be
settled by delivery after trading in such contracts has ceased; and, if not
previously delivered, delivery must be made on the last business day of the
month. 2008 (01/01/00)
1109.02 Trading in the Delivery Month - After trading in contracts for future
delivery in the current delivery month has ceased in accordance with Regulation
1109.01 of this Chapter, outstanding contracts for such delivery may be
liquidated by means of (a bona fide) exchange of such current futures for the
(actual) cash commodity. 2009 (08/01/98)
1110.01 Margin Requirements - (See Regulation 431.03) (09/01/94)
1111.01 Disputes - All disputes between interested parties may be settled by
arbitration as provided in the Rules and Regulations. 2011 (09/01/94)
1112.01 Position Limits and Reportable Positions - (See 425.01) (09/01/94)
Ch11 Delivery Procedures
1136.01 Standards - The contract grade for delivery on futures contracts made
under these Regulations shall be Crude Soybean Oil which conforms to the
following specifications:
(a) It shall be one of the following types: Expeller pressed, expeller pressed
degummed, solvent extracted, or solvent extracted degummed. Mixtures of one
type with any other type shall not be deliverable;
(b) It shall contain not more than 0.3% moisture and volatile content;
(c) It shall be lighter in green color than Standard "A" and when refined and
bleached shall produce a refined and bleached oil of not deeper color than
3.5 red on the Lovibond scale;
(d) It shall refine with a loss not exceeding 5% as determined by the "neutral
oil" method;
(e) It shall have a flash point not below 250 degrees Fahrenheit, closed cup
method;
(f) It shall contain no more than 1.5% unsaponifiable matter (exclusive of
moisture and volatile matter).
No lower grade shall be delivered in satisfaction of contracts for future
delivery. A higher grade may be delivered at contract price except that where
the refining loss is less than 5% as determined by the "neutral oil" method, a
premium of one percent of the cash market price at the time of loading shall be
paid for each one percent under the 5% loss (fractions figured throughout) with
a maximum credit of 41-2%.
American Oil Chemists' Society methods shall be followed for sampling and
analysis for all tests, except for determining green color, which test shall be
the National Soybean Processors Association tentative method.
A tolerance of 150 lbs. of sludge shall be allowed for each trading unit of
60,000 lbs. If the car contains more than 150 lbs. of sludge or if a truck
contains more than 125 lbs. of sludge, an allowance shall be made to the Buyer
for a total amount of sludge up to 1,000 lbs. at 50% of the price at time of
unloading car. Sludge in excess of 1,000 lbs. shall be allowed for at the price
at time of unloading car.
Sludge shall be considered to be solid residue which cannot be pumped and
squeegeed from the car for the net out-turn weight. 2002 (09/01/94)
1136.02 United States Origin Only - Effective September 1, 1992, a futures
contract for the sale of soybean oil shall be performed on the basis of United
States origin only upon written request by a taker of delivery at the time
loading orders are submitted. (09/01/94)
1137.01 Official Chemist's Certificates - Certificates for quality analysis by
any Official Chemists shall be acceptable and binding on all parties except as
otherwise provided.
The official chemists are Woodson-Tenent Laboratories with laboratories located
at Memphis, Tenn.; Chicago, Ill.; Des Moines, la.; Wadlington's Referee &
Testing Laboratory in Chicago, Ill.; Chas. V. Bacon Laboratories, Inc., New
York, New York and Barrow-Agee Laboratories, Memphis, Tenn. 2029 (09/01/94)
1138.01 Sampling - Samples shall be drawn at time of loading by Official
Samplers licensed by the Exchange. The Official Sample shall be 2 one-quart and
1 half-gallon samples. These portions should be packaged in clean, dry and new
containers. Either tinned metal containers or high density polyethylene bottles
fitted with metal caps having oil resistant cap liners are acceptable.
Polythylene containers must be enclosed for shipping in custom-made, close
fitting cardboard containers. The sample must be drawn at the time of loading in
accordance with A.O.C.S. Official Method for sampling crude oils (C1-47-
Continuous Flow and Trier methods) and shall be so indicated on invoice. If the
Shipper neglects to provide such a sample at the time of loading or fails to
show on invoice than an Official Sample has been taken, a sample drawn at
destination shall be official when taken in accordance with the A.O.C.S.
Official Methods as noted above. Shipper shall forward to Consignee one of the
one-quart portions at no expense to Consignee within one working day of
completion of loading and label of sample must designate type of oil and plant
destination. The one-half gallon portion (third portion) is to be retained by
Shipper as the referee sample for a minimum of thirty days
Ch11 Delivery Procedures
------------------------
after loading.
Each sample must be accompanied by a certificate in the following form:
Board of Trade of the City of Chicago
OFFICIAL SAMPLERS CERTIFICATE
I hereby certificate that sample marked______________________________was drawn
by me on this_________day of_________________, 20________, within 24 hours after
loading tank car or truck in accordance with the requirements of Regulation
1138.01 of the Board of Trade of the City of Chicago, and that it is a fair and
true sample of the contents of:
Car/Truck No. (and initial)__________________, located at__________________
containing approximately_______________________pounds, of__________________
_________________________________________________________________________
(Expeller pressed. Expeller pressed degummed, Solvent Extracted,___________
____________type Crude Soybean Oil. Solvent Extracted Degummed)
______________________________________________________________Solvent used.
That sample was taken in a manner prescribed by the American Oil Chemists
Society.
____________________________
OFFICIAL SAMPLER
2023
(01/01/00)
1139.01 Weighing - On all deliveries, the weight as determined by an Official
Weigher shall be binding on all interested parties. Due allowance shall be made
to cover the loss of weight due to sampling, if sample is drawn from weighing.
An official weigher is a person or agency approved by the Exchange. 2024
(09/01/94)
1140.01 Grading - Shipper shall have option, and advise warehouse receipt
holder of his selection at time of receipt of loading instructions, of having
grade determined by one of the following methods:
A. Official Chemist Analysis, shipper to pay the cost.
B. Comparison between consignee's and shipper's analyses.
1. Each party must mail to other party his analysis within 15 days after
bill of lading date.
2. If parties do not agree as to quality (refining loss excepted) either
one may request analysis by Official Chemist. The findings of the
Official Chemist shall be binding on both parties and the cost of such
analysis shall be charged to the party against whom the decision
results.
3. In case of refining loss, based on the "neutral oil" method, if the
difference is not over three tenths of one percent the settlement shall
be made on the average of the two, otherwise the retained sample shall
be sent to Official Chemist for analysis. If the Official Chemist's
results are the mean of the shippers' and consignees' analyses, then the
cost shall be shared equally; otherwise, the cost shall be charged to
the party against whom the decision results. 2025 (09/01/94)
1141.01 Delivery Points - Crude Soybean Oil may be delivered in satisfaction of
Soybean Oil futures contracts from regular warehouses located in Illinois
Territory, Eastern Territory, Eastern Iowa Territory, Southwest Territory or
Northwest Territory as defined in this regulation and at the following price
differentials:
(a) Illinois Territory (That portion of the state of Illinois north of latitude
38(degree)00' N.)..... at contract price.
(b) Eastern Territory (Those portions of the states of Indiana and Kentucky
west of the Ohio-Indiana border and its extension and north of latitude
38(degree)00'N.)....at 30/100ths of one cent per pound under contract
price.
(c) Eastern Iowa Territory (That portion of the state of Iowa east of longitude
93(degree)50'W.)....at 20/100ths of one cent per pound under contract
price.
(d) Southwest Territory (Those portions of the states of Missouri and Kansas
north of latitude 38(degree)00'N. and east of longitude 97(degree)00'W.)...
at 15/100ths of one cent per pound under contract price.
(e) Northwest Territory (Those portions of the states of Minnesota south of
latitude 45(degree)10'N., South
Ch11 Delivery Procedures
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Dakota south of latitude 45(degree)10'N., and east of 97(degree)00'W., Iowa
west of longitude 93(degree)50'W., and Nebraska east of longitude
97(degree)00'W.)..... at 45/100ths of one cent per pound under contract
price.
(f) For a given soybean crop year ending August 31 and for a given Soybean Oil
futures delivery territory except the "Illinois Territory:" when the weekly
(as of Friday) cumulative average ratio of outstanding Soybean Oil
Warehouse Receipts to CBOT maximum 24 hour soybean crushing capacity within
that Soybean Oil futures delivery territory, relative to that ratio for the
combined remaining Soybean Oil territories, is less than or equal to 0.5,
payment for Warehouse Receipts issued from that Soybean Oil territory will
be at a premium of 10 cents per hundredweight over contract price in
addition to the delivery territorial differential adjustment.
(g) For a given soybean crop year ending August 31, when the "Illinois
Territory's" weekly (as of Friday) cumulative average ratio of outstanding
Soybean Oil Warehouse Receipts to maximum CBOT 24 hour soybean crushing
capacity within the Illinois Soybean Oil futures delivery territory,
relative to that ratio for the combined remaining Soybean Oil territories,
is less than or equal to 0.5, payment for Warehouse Receipts issued from
all other Soybean Oil territories will be at a discount of 10 cents per
hundredweight under contract price in addition to the delivery territorial
differential adjustments.
(h) For a given soybean crop year ending August 31 and for a given Soybean Oil
futures delivery territory except the "Illinois Territory," when the weekly
(as of Friday) cumulative average ratio of outstanding Soybean Oil
Warehouse Receipts to CBOT maximum 24 hour soybean crushing capacity within
that Soybean Oil futures delivery territory, relative to that ratio for the
combined remaining Soybean Oil territories, is greater than or equal to
2.0, payment for Warehouse Receipts issued from that Soybean Oil territory
will be at a discount of 10 cents per hundredweight under contract price in
addition to the delivery territorial differential adjustment.
(i) For a given soybean crop year ending August 31, when the "Illinois
Territory's" weekly (as of Friday) cumulative average ratio of outstanding
Soybean Oil Warehouse Receipts to CBOT maximum 24 hour soybean crushing
capacity within the Illinois Soybean Oil futures delivery territory,
relative to that ratio for the combined remaining Soybean Oil territories,
is greater than or equal to 2.0, payment for Warehouse Receipts issued from
all other Soybean Oil territories will be at a premium of 10 cents per
hundredweight over contract price in addition to the delivery territorial
differential adjustments.
(j) Items (f) through (i) of Regulation 1141.01 shall apply to all CBOT Soybean
Oil futures contracts delivered during a one calendar year period beginning
with January following the soybean crop year ending August 31, provided
that there are on a weekly average at least 150 outstanding Soybean Oil
Warehouse Receipts in all Soybean Oil delivery territories combined during
that previous soybean crop year.
(k) Based on the adjustments made to territorial delivery differentials during
a given calendar year as outlined in items (f) through (j) of Regulation
1141.01, the CBOT shall announce and publish by September 15 of that given
calendar year new territorial delivery differentials applicable to all
Soybean Oil futures contracts delivered during the next calendar year. 2015
(01/01/00)
1142.01 Deliveries By Warehouse Receipts - Except as otherwise provided,
deliveries on Crude Soybean Oil shall be made by delivery of warehouse receipts
issued by warehouses which have been approved and designated as regular
warehouses by the Exchange for the storage of Crude Soybean Oil. The warehouse
receipt shall be accompanied by insurance certificates or the warehouse receipt
marked "insured" and shall evidence that storage charges have been paid up to
and including the 18th day of the preceding month. Unpaid accumulated storage
charges at the posted tariff applicable to the warehouse where the soybean oil
is stored shall be allowed and credited to the buyer by the seller to and
including date of delivery. In order to effect a valid delivery each warehouse
receipt must be endorsed by the holder making the delivery. 2012 (09/01/94)
1143.01 Registration of Warehouse Receipts - Warehouse receipts, in order to
be eligible for delivery, must be registered with the Official Registrar, must
not be more than one year old, and must not have an expiration date in the month
in which they are delivered. Registration of warehouse receipts shall also be
subject to the following requirements:
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(a) Warehousemen who are regular for delivery may register warehouse receipts
at any time. The holder of a registered warehouse receipt may cancel its
registration at any time. A warehouse receipt which has been canceled may
not be registered again.
(b) No notice of intention to deliver a warehouse receipt shall be tendered to
the Clearing House unless said warehouse receipt is registered and in the
possession of the Clearing House member tendering the notice or unless a
warehouse receipt is registered and outstanding.
(c) When a notice of intention to deliver a warehouse receipt has been tendered
to the Clearing House, said warehouse receipt shall be considered to be
"outstanding". The member issuing such notice shall transmit to the
Registrar, at the same time the notice is tendered to the Clearing House,
the warehouse receipt number and the name and location of the regular
warehouse. Said warehouse receipt shall remain outstanding until either its
registration is canceled or the issuing warehouseman declares the receipt
is not outstanding.
(d) When a regular warehouseman regains control of an outstanding warehouse
receipt issued against stocks in one of his regular warehouses, which in
any manner relieves him of the obligation to loadout crude soybean oil upon
demand of a party other than himself, the warehouseman shall by noon of the
next business day either cancel the registration of said warehouse receipt
or declare that said warehouse receipt is not outstanding but is to remain
registered by transmitting to the Registrar the warehouse receipt number
and the name and location of the regular warehouse, except in the case
where a notice of intention to redeliver said warehouse receipt for the
warehouseman has been tendered to the Clearing House by 4:00 p.m. of the
day that the warehouseman regained control of said warehouse receipt. 2013
(09/01/94)
1143.02 Reissuance of Warehouse Receipts - On or before July 1, 1964, all
outstanding warehouse receipts that are over one year old must be returned to
the warehouseman for reissuance and thereafter every crude soybean oil receipt
must be returned to the warehouseman or his agent for reissuance prior to its
becoming one year old. At such time accrued storage charges shall be paid and
the warehouseman shall be obligated to provide the owner with a new and duly
registered receipt.
Every Soybean Oil Warehouse Receipt which is not returned to the warehouse, or
his agent, for reissuance prior to its becoming one year old, will be subject to
the late charge which will be paid to the warehouse by the owner on the day that
the accrued storage charges are paid. The late charge will be an amount equal to
the total unpaid accumulated storage charges multiplied by the "prime interest
rate" in effect on the day that the accrued storage charges are paid multiplied
by the number of calendar days that the receipt is past due, divided by 360
days. The term "prime interest rate" shall mean the lowest of the rates
announced by each of the following four banks at Chicago, Illinois as its "prime
rate": Continental Illinois National Bank and Trust Company of Chicago, The
First National Bank of Chicago, Harris Trust and Savings Bank and The Northern
Trust Company. The number of calendar days that the receipt is past due shall be
the number of days beginning with the day that the receipt is one year old and
continuing through the business day that the receipt is returned to the shipper
or his agent. 2012A (09/01/94)
1144.01 Receipt Format - The following form of warehouse receipt shall be
used:
Date___________
No.______________
Received in store__________________, 20___________, in______________________
Warehouse, located at_______________________________________________________
in the Illinois ___________ Territory, ____________________________pounds
Eastern ___________
Eastern Iowa ___________
Southwest ___________
Northwest ___________
of Crude Soybean Oil under standards of the Board of Trade of the City of
Chicago, which will be delivered, subject to and in conformity with the Rules
and Regulations of the Board of Trade of the City of Chicago, to the order of
___________________________________________________________________________
upon surrender of this receipt and payment of all charges.
This oil is stored subject to the provisions of the laws of the State in
relation to warehousemen, any applicable Federal Laws, and subject to the Rules
and Regulations of the Board of Trade of the City of Chicago, as filed with the
Commodity Exchange Authority.
The warehouseman acknowledges that the oil so received into store complies with
the requirements of said Rules and Regulations of the Board of Trade of the City
of Chicago and that said oil is tenderable on contracts for future delivery made
Ch11 Delivery Procedures
------------------------
under said Rules and Regulations.
The warehouseman states that at the warehouseman's own expense said oil is
insured and will be kept insured for the current market value against loss or
damage from fire, lightning and/or any of the contingencies covered in the
standard extended coverage form for the benefit of the holder of this receipt.
Storage rates of____________per hundred pounds, per day shall include the cost
of insurance. The cost of loading into tank cars shall be____________ of 1
per pound. The cost of loading into trucks shall be_________________ of 1 per
pound.
The warehouseman claims a lien for the following:
All storage charges have been paid on Crude Soybean Oil covered by this receipt
up to and including the last date endorsed below.
Storage Payments
_____________________ By______________________ _______________________
Company
_____________________ By______________________ By_____________________
Registration of this Receipt
must be canceled before
_____________________ By________________________ property can be released
2034
(01/01/00)
1145.01 Lost or Destroyed Negotiable Warehouse Receipts - (See Regulation
1045.01) (04/01/00)
1146.01 Date of Delivery - Where Crude Soybean Oil is sold for delivery in a
specified month, delivery of such Crude Soybean Oil may be made by the Seller
upon such day of the specified month as the Seller may select. If not previously
delivered, delivery must be made upon the last business day of the month. 2017
(09/01/94)
1147.00 Delivery Notice - (See 1047.00) (09/01/94)
1147.01 Delivery Notices - (See 1047.01) (09/01/94)
1148.00 Method of Delivery - (See 1048.00) (09/01/94)
1149.00 Time of Delivery, Payment, Form of Delivery Notice - (See 1049.00)
(09/01/94)
1149.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
1149.03 Sellers' Invoice to Buyers - (See 1049.03) (09/01/94)
1149.04 Payment - (See 1049.04) (09/01/94)
1150.00 Duties of Members - (See 1050.00) (09/01/94)
1151.01 Office Deliveries Prohibited - No office deliveries of warehouse
receipts may be made by members of the Clearing Corporation. Where a commission
house as a member of the Clearing Corporation has an interest both long and
short for customers on its own books, it must tender to the Clearing Corporation
such notices of intention to deliver as it receives from its customers who are
short. 2009 (09/01/94)
1154.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
1156.01 Storage Charges - The storage rates on Crude Soybean Oil shall not
exceed 3/10th of one cent per day per 100 pounds. When shipper schedules tank
car loading, storage shall continue through the date of surrender of a properly
cancelled warehouse receipt and shall begin again on the sixth day after
surrender date if loading has not been completed and continue until the oil has
been loaded. When shipper schedules truck loading storage, charges shall
continue through the date of loading. The maximum charge for loading tank cars
at delivery point shall not exceed 1/40th of one cent per pound and the
combined charge for unloading and loading tank cars at delivery point shall not
exceed 1/10th of one cent per pound including heating. The maximum charge for
loading tank trucks at delivery point shall not exceed 1/25th of one cent per
pound. Regular Soybean Oil warehousemen shall maintain in the immediate vicinity
of the Exchange either an office, or duly authorized representative or agent
approved by the Exchange, to whom Soybean Oil Storage charges may be paid. 2033
(09/01/94)
1156.02 Storage, Car Rental, Etc. - Except as otherwise provided, all charges
for storage, car rental, etc., shall remain the responsibility of the Seller
until payment is made. Payment is to be made
Ch 11 Delivery Procedures
-------------------------
by a check drawn on and certified by a Chicago bank or by a Cashier's check
issued by a Chicago bank. 2020 (09/01/94)
1156.03 Fees - Sampling: The charge for drawing Official samples shall be
$5.00 for each tank car or truck on inbound shipments to a warehouse.
If sampling is ordered at a location where an Official Sampler is not regularly
located, all extra costs must be paid by the party ordering the sample.
These charges shall include the cost of delivering the samples to the Official
Chemists. 2028 (09/01/94)
Ch11 Regularity of Warehouses
*1180.01 Duties of Warehouse Operators - It shall be the duty of the operators
of all regular warehouses:
(a) To accept Crude Soybean Oil for delivery on Chicago Board of Trade
contracts, provided such Crude Soybean Oil is of contract grade when
received at such warehouses, and all space in such warehouses is not already
filled or contracted for, to pay no premium on refining loss but to receive
allowance for sludge. All inbound freight (including the transit charge
necessary to obtain the transit balance rate) shall be prepaid by the
depositor of the oil. Upon surrender of the inbound billing to the
warehouseman the depositor of the oil shall be furnished with a regular
Board of Trade Warehouse Receipt endorsed thereon with the transit balance
freight to New York.
(b) To notify the Exchange of any change in the condition of their warehouses.
(c) To insure soybean oil covered by warehouse receipts tendered for delivery
against the contingencies provided for in a standard "All Risks" policy
(including earthquake) to such an extent and in such amounts as required by
the Exchange.
Any loss or damage to oil caused by leakage or discharge from the storage
facilities resulting from the cracking, rupture, bursting, collapse,
subsidence or disruption of the containing system, or the negligence of the
warehouse operator shall be for the account of the warehouse operator,
unless such loss or damage by leakage or discharge from the storage
facilities is due to causes required to be insured against under this
Regulation.
(d) To furnish the Exchange with either a copy of the current insurance policy
or policies, or a written confirmation from the insurance company that such
insurance has been effected.
(e) To advise the holder of the warehouse receipts when oil is tendered on a
futures contract. the freight rate on the oil upon request to New York,
N.Y., or to any other specific destinations; and to forward the oil on the
basis of these rates whenever shipping instructions are received if orders
are received within three days.
(f) To register their daily load-out rate [for} in jumbo rail tank car[s]
equivalents (minimum of 4) [and their daily load out rate for trucks
(minimum of 2 times the daily registered load out rate of jumbo tank cars]
with the Exchange. Warehouse Operators shall limit warehouse receipts
issued to an amount of soybean oil equal to the lesser of their approved
regular space or 30 times the registered daily loading rate for jumbo tank
cars times 152,500 pounds.
(g) To ship oil ordered out of the warehouses in Buyer's tank cars, if so
arranged and to begin loading out soybean oil on or before the third
business day following the date the car is ready for loading or the receipt
is cancelled, whichever occurs later, at a daily rate per business day equal
to [the greater of the equivalent of four jumbo rail tank cars or at] the
equivalent of shipper's registered daily rate of loading jumbo rail tank
cars.
All rail loading orders received prior to 2:00 p.m. on a given business day
shall be considered dated that day and shall be entitled to equal treatment.
Rail loading orders received after 2:00 p.m. on a business day shall be
considered dated the following business day. When loading against rail
loading orders and shipping instructions received by a shipper prior to 2:00
p.m. on a given business day, as determined hereunder, cannot be completed
on the third following business day, the shipper shall allocate daily
loading against such loading orders as equitably as possible on a pro-rata
basis on subsequent business days. Loading against all rail [truck] orders
scheduled for a given business day shall be completed before loading of any
orders scheduled for a subsequent business day.
(h) To load each tank car to its stenciled capacity upon surrender of sufficient
warehouse receipts tendered on futures contracts. Any excess or deficiency
from amount of warehouse receipt shall be settled at market price as of date
of loading. Warehouse to make sight draft on shipper with Bill of Lading
attached for any amounts due them in connection with loading oil, including
premium for refining loss, unless otherwise mutually agreed.
(i) To hold tank car after loading free of expense to shipper (except for car
rental) until grade is
Ch11 Regularity of Warehouses
-----------------------------
ascertained, and if grade is not of contract grade to unload car and
reload oil of contract quality free of expense to shipper, and at all
times to keep oil fully insured until car is released to railroad.
(j) To ship oil ordered out of the warehouse in Buyer's tank truck, if so
arranged, and to load the oil at a daily rate per business day equal to
[the greater of eight trucks or at] the equivalent of shipper's
registered daily rate of loading for [trucks] jumbo rail tank cars.
All truck loading orders received prior to 2:00 p.m. on a given
business day shall be considered dated that day and shall be entitled
to equal treatment. Truck orders received after 2:00 p.m. on a business
day shall be considered dated the following business day.
When loading orders are received by 2:00 p.m. of any given business
day, the shipper will advise the owner by 4:00 p.m. the same day of
loading dates and tonnage due. Notification will be by telephone,
telegraph or teletype.
When a shipper has received one or more truck loading orders he shall
begin loading against them not later than the third business day
following their receipt. When loading against loading orders and
shipping instructions received by a shipper prior to 2:00 p.m. on a
given business day cannot be completed on the third following business
day shipper shall allocate daily loadings against such loading orders
as equitably as possible on a pro rata basis on subsequent business
days.
Loading against all truck orders scheduled for a given business day
shall be completed before loading begins on any orders scheduled for a
subsequent business day. Warehouseman will load tank trucks as promptly
as possible on the day scheduled. Under no conditions will warehouseman
be responsible for truck demurrage as long as it is loaded on day
scheduled. Additional loadings may be arranged for by mutual agreement.
(k) Notwithstanding any other provisions of this Regulation, on days when
both rail cars and trucks are loaded, the warehouseman shall be
required to load at a minimum daily rate equal to the equivalent of
shipper's registered daily rate of loading rail tank cars.
All rail and truck loading orders received prior to 2:00 p.m. on a
given business day shall be considered dated that day and shall be
entitled to equal treatment. Loading orders received after 2:00 p.m. on
a business day shall be considered dated the following business day.
When loading against loading orders and shipping instructions received
by a shipper prior to 2:00 p.m. on a given business day, as determined
hereunder, cannot be completed on the third following business day, the
shipper shall allocate daily loading against such loading orders as
equitably possible on a pro-rata basis on subsequent business days.
Loading against orders scheduled for a given business day shall be
completed before loading of any orders for a subsequent business day.
([k]) To keep stock of Crude Soybean Oil in storage in balance with oil
represented by outstanding warehouse receipts.
It shall be the privilege of all regular warehouses to mingle or store
together oil which is tenderable on contracts for future delivery under
these Regulations, with other oil of like type and to deliver on
loading orders oil of any contract type. 2031
([l][m]) Certification of Soybean Oil - Effective September 1, 1992 and upon
written request by a taker of delivery at the time loading orders are
submitted for the delivery of soybean oil against canceled warehouse
receipts, the delivery warehouseman shall certify in writing to the
taker of delivery on the day that the transportation conveyance is
loaded that the soybean oil is produced from soybeans of U.S. origin
only. Warehouse receipts issued prior to September 1, 1992 will be
deliverable against futures contracts beginning September 1992 only if
the regular warehouseman provides certification on the warehouse
receipt that the U.S. origin-only option is available to the taker of
delivery of soybean oil. (01/01/00)
* Additions underlined; deletions bracketed for contracts from March 2001
forward.
1180.01A Responsibility for Furnishing Tank Cars - It shall be the
responsibility of the buyer of Crude Soybean Oil on a futures contract to
furnish tank cars when ordering Soybean Oil shipped from a warehouse. 26R
(09/01/94)
1180.01B Car Ready for Loading-Regulation 1180.01(f) A car is ready for
loading when it has
Ch11 Regularity of Warehouses
-----------------------------
been constructively placed and when the shipper has used due diligence in
preparing and placing the car on his property for loading. 30R1180.01C Transit
vs. Flat Rate (09/01/94)
1180.01C Transit vs. Flat Rate Billing - If warehouseman furnishes transit
billing on crude soybean oil applicable to warehouse receipts holder's
destination, the warehouse receipt holder shall pay to warehouseman the
difference between the transit balance rate and the flat rate. 27R (09/01/94)
1180.01D Freight Differentials - Jumbo Tank Cars - The Board of Directors at
its regular meeting held on Tuesday, March 10, 1964, approved the following
Ruling recommended by the Crude Soybean Oil and Soybean Meal Committee in light
of the reduced rate on jumbo tank cars which became effective on February 9,
1964:
"Effective on March 1964 contracts the freight differentials in Regulations
1141.02 and 1180.02 shall be calculated on the basis of the jumbo tank car rate
since it is the lowest lawful carload rate and will be applicable to warehouse
receipts bearing no billing and any other warehouse receipts carrying billing
that will protect the jumbo tank car rate." 36R (09/01/94)
1180.02 Transit Billing - Transit billing may be applied to shipments at
warehouseman's option with warehouseman to get any advantage of such transit
application; however, warehouseman must protect the lowest lawful local carload
rate from point of loading stated in warehouse receipt to destination indicated
in shipping instructions, and such transit billing must allow at least one
additional transit beyond delivery points. 2016 (09/01/94)
1180.03 Freight Charges - A warehouseman that is not served by a Class I
railroad must compensate the taker of delivery for the switching charge and/or
the rail rate to the nearest Class I railroad interchange point for the movement
of soybean oil beyond the interchange point by the Class I railroad, if
requested by the owner of the soybean oil. The request must be in writing when
loading orders and canceled warehouse receipts are presented to the warehouse.
(01/01/00)
1181.01 Conditions of Regularity - Persons operating bulk oil warehouses who
desire to have such warehouses made regular for delivery of Crude Soybean Oil
under the Rules and Regulations shall make application for an initial
Declaration of Regularity on a form prescribed by the Exchange prior to May 1,
1994, and every even year thereafter, for a two year term beginning July 1,
1994, and every even year thereafter, and at any time during a current term for
the balance of that term. Regular Soybean Oil Warehouses who desire to increase
their regular capacity during a current term shall make application for the
desired amount of total regular capacity on the same form. Initial regularity
for the current term and increases in regularity shall be effective either
thirty days after a notice that a bona fide application has been received is
posted on the floor of the exchange, or the day after the application is
approved, whichever is later. Applications for renewal of regularity must be
made prior to May 1, 1994, and every even year thereafter, for the respective
years beginning July 1, 1994, and every even year thereafter, and shall be on
the same form.
The following shall constitute the requirements and conditions for regularity:
1) The warehouse making application shall be inspected.
2) Such warehouse shall be within the limitation of an area not east of the
Indiana-Ohio boundary; nor south of Louisville, KY.
3) Such warehouse shall be connected by railroad tracks with one or more
railway lines.
4) The proprietor or manager of such warehouse shall be in good financial
standing and credit, and shall meet the minimum financial requirements and
financial reporting requirements set forth in Appendix 4E. No warehouse
shall be declared regular until the person operating the same files a bond
with sufficient sureties in such sum and subject to such conditions as the
Exchange may require.
5) Such warehouse shall maintain on-site standard equipment and appliances for
the receiving, handling, and shipping of Crude Soybean Oil in bulk,
including equipment to issue official origin weight. Official origin weight
may be obtained by using one of the following which is recognized by the
Soybean Oil Committee of the Board of Trade of the City of Chicago: (1)
platform scale (either rail or truck); (2) tank scale; or, (3) batch scale.
Ch11 Regularity of Warehouses
-----------------------------
6) The proprietor or manager of such warehouse shall honestly and cordially
cooperate with the system of registration of warehouse receipts and other
than oil owned by warehouseman furnish to the Registrar of such receipts all
needed information to enable him to keep a correct record and account of all
Crude Soybean Oil received and delivered by them daily and of that remaining
in store at the close of each week.
7) The proprietor or manager of such warehouse shall accord every facility to
any duly authorized committee for the examination of its books or records
for the purpose of ascertaining the stocks of Crude Soybean Oil which may be
on hand at any time. Such examination and verification may be made at any
time by the Business Conduct Committee, which committee shall have the
authority to employ experts to determine the quantity of Crude Soybean Oil
in said warehouse and to compare the books and records of said regular
warehouse with the records of the Official Registrar of Crude Soybean Oil
warehouse receipts.
8) No warehouse shall be deemed suitable to be declared regular if its
location, accessibility, tariffs, insurance rates or other qualifications
shall depart from uniformity to the extent that its receipts as tendered in
satisfaction of futures contracts will unduly depress the value of futures
contracts or impair the efficacy of futures trading in this market, or if
the warehouseman operating such warehouses engages in unethical or
inequitable practices, or if the warehouseman fails to comply with any laws,
Federal or State, or Rules or Regulations promulgated under those laws.
9) The warehouseman shall make such reports, keep such records, and permit such
warehouse visitation as the Secretary of Agriculture may prescribe, and
shall comply with all applicable Rules and Regulations and orders
promulgated by the Secretary of Agriculture or the government agency
administering the Commodity Exchange Act, and shall comply with all
requirements made by the Exchange because of such Rules and Regulations or
orders.
10) The operator or manager of such warehouse shall be subject to the
Association's Rules and Regulations pertaining to arbitration procedures, as
set forth in Chapter 6, and, with respect to compliance with Rules and
Regulations pertaining to a warehouse's regularity, shall be subject to the
Association's Rules and Regulations pertaining to disciplinary procedures,
as set forth in Chapter 5.
11) The operator or manager of such warehouse shall consent to the disciplinary
jurisdiction of the Exchange for five years after such regularity lapses,
for conduct pertaining to regularity which occurred while the warehouse was
regular.
12) If the warehouseman leases the warehouse or has entered into some form of
service arrangement pursuant to which an agent or contractor performs the
daily operations of the warehouse, the warehouseman shall submit an
indemnification as prescribed by the Exchange. 2030 (10/01/96)
1181.02 Leasing and Service Arrangements - The warehouseman of a regular
warehouse is not required to own the warehouse and may lease the facility from
the owner. The warehouseman may also enter into a service arrangement pursuant
to which an agent or contractor performs the daily operations of the warehouse.
The warehouseman shall be responsible for the conduct of its agents or
contractors.
In the event that the warehouseman is unable properly to store or load out oil
for receipt holders because of another party's ownership of or control over the
warehouse, the warehouseman shall, at its own expense, provide each holder of an
outstanding receipt with either (a) a replacement warehouse receipt at another,
mutually acceptable regular warehouse, with adjustments for differences in
contract differentials or, if such replacement receipt is unavailable, (b) an
equivalent quantity and quality of the soybean oil designated in the warehouse
receipt at a mutually acceptable location. (09/01/94)
1184.01 Revocation, Expiration or Withdrawal of Regularity - Any regular
warehouse may be declared irregular at any time if it does not comply with the
conditions above set forth, or fails to carry out the prescribed duties of the
warehouseman. If the designation of a warehouse as regular shall be revoked a
notice of such revocation and the period of time, if any, during which the
receipts issued by such house shall thereafter be deliverable in satisfaction of
futures contracts in Crude Soybean Oil under the Rules and Regulations, shall be
posted on the bulletin board.
In the event of revocation, expiration or withdrawal of regularity, or in the
event of sale or abandonment
Ch11 Regularity of Warehouses
-----------------------------
of the properties where regularity is not reissued, holders of outstanding
warehouse receipts shall be given thirty days to take load-out of the commodity
from the facility. If a holder of an outstanding warehouse receipt chooses not
to take load-out during this period, the facility must provide him with another
warehouse receipt at another, mutually acceptable regular warehouse, with
adjustments for differences in contract differentials. Alternatively, if such
warehouse receipt is unavailable, the facility must provide the holder with an
equivalent quantity and quality of the soybean oil designated in the warehouse
receipt at a mutually acceptable location. 2032 (09/01/94)
1185.01 Application for Declaration of Regularity - All applications by
operators of warehouses for a Declaration of Regularity under Regulation 1181.01
shall be on the following form:
WAREHOUSEMAN'S APPLICATION FOR A DECLARATION OF REGULARITY FOR THE DELIVERY OF
CRUDE SOYBEAN OIL UPON CONTRACTS FOR FUTURE DELIVERY UNDER THE CHARTER, RULES
AND REGULATIONS OF THE BOARD OF TRADE OF THE CITY OF CHICAGO
____________, 20________
BOARD OF TRADE OF THE CITY OF CHICAGO
Chicago, Illinois
Gentlemen:
We, the_________________________________________________(Hereinafter called
Warehousemen) owner or lessee of The_______________________________________
located at_________________________________________________________________
in the Illinois ____________ Territory,
Eastern ____________
Eastern Iowa ____________
Southwest ____________
Northwest ____________
having a storage capacity of_______________________ pounds of Crude Soybean Oil,
licensed/not licensed under the Warehouse Act of the State of
______________________ having a bond in the sum of____________________ Dollars,
and having/not having a soybean processing plant attached with a maximum 24 hour
crushing capacity of___________bushels of Soybeans per day, do hereby make
application to the Board of the Trade of the City of Chicago (hereinafter called
Exchange) for a declaration of regularity to handle, receive, and store Crude
Soybean Oil for delivery upon contracts for future delivery, for a period
beginning____________________________ and ending midnight June 30 ____.
Conditions of Regularity
Such declaration of regularity, if granted, shall be cancellable by the Exchange
whenever the following conditions shall not be observed:
1. The Warehouseman must:
(1) give such bonds to the Exchange as it may require.
(2) submit to the Exchange for approval with such application for a declaration
of regularity, a tariff listing in detail the maximum rates for the handling
and storage of Crude Soybean Oil; submit promptly to the Exchange all
changes in said tariff, publish and display such tariff.
(The maximum charge for loading tank cars at delivery point shall not exceed
1/40th of one cent per pound on any loading during the term of this
application. The maximum charge for loading trucks at delivery point shall
not exceed 1/25th of one cent per pound on any loading during the term of
this application.)
(3) remove no Crude Soybean Oil from the warehouse other than oil owned by the
warehouseman save at the request of the owner or owners thereof upon
surrender of the warehouse receipts.
(4) notify the Exchange immediately of any change in capital ownership, or any
reduction in total capital of 20 percent or more from the level reported in
the last financial statement filed with the Exchange, or of any change of
conditions of its warehouse.
(5) make such reports, keep such records, and permit such warehouse visitation
as the Secretary of Agriculture may prescribe; comply with all applicable
Rules and Regulations and orders promulgated by the Secretary of Agriculture
or the Government Agency administering the Commodity Exchange Act; and
comply with all requirements of the Exchange permitted or required by such
Rules and Regulations or orders.
(6) make application for renewal of a declaration of regularity in writing on or
before May 1, 1994, and every even year thereafter.
(7) submit an indemnification as prescribed by the Exchange if the Warehouseman
leases the warehouse or has entered into some form of service arrangement
pursuant to which an agent or contractor performs the daily operations of
the warehouse.
(8) notify the Exchange immediately of any change in the maximum 24 hour
crushing capacity of soybeans for a soybean processing plant attached to its
warehouse.
2. The Warehouse must be:
(1) subject to the prescribed examination and approval of the Exchange.
(2) properly safeguarded and patrolled.
(3) connected to a railroad.
(4) equipped with standard equipment and appliances for the convenient and
expeditious handling of Crude Soybean Oil in bulk.
3. The Warehouse and Warehouseman must conform to the uniform requirements of
the Exchange as to location, accessibility, and suitability as may be
prescribed by the Rules and Regulations of the Exchange.
Ch11 Regularity of Warehouses
-----------------------------
Agreements of Warehouseman
The Warehouseman expressly agrees:
(1) that all Crude Soybean Oil tendered in satisfaction of futures contracts
will be weighed by an Official Weigher of the Exchange.
(2) that all Crude Soybean Oil tendered in satisfaction of futures contracts
will, when shipped from warehouse, be sampled by an Official Sampler and
tested in accordance with Regulation 1140.01 of the Exchange.
(3) that all warehouse receipts shall be registered with the Registrar of the
Exchange.
(4) to fulfill the duties set forth in Regulation 1180.01 of the Exchange.
(5) to abide by the Rules and Regulations of the Exchange relating to the
warehousing of Crude Soybean Oil deliverable in satisfaction of futures
contracts and the delivery thereof in satisfaction of futures contracts.
(6) that the Exchange may cancel said declaration of regularity, if granted,
for any breach of such agreements.
(7) that the signing of this application constitutes a representation that the
conditions of regularity are complied with and will be observed during the
life of the declaration of regularity and, if found to be untrue, the
Exchange shall have the right to cancel said declaration of regularity
immediately.
(8) to have a representative in Chicago authorized and known to the Exchange to
act in matters pertaining to warehouse receipts.
(9) to be subject to the Association's Rules and Regulations pertaining to
arbitration procedures, as set forth in Chapter 6, and with respect to
compliance with Rules and Regulations pertaining to regularity, to be
subject to the Association's Rules and Regulations pertaining to
disciplinary procedures, as set forth in Chapter 5; and to abide by and
perform any disciplinary decision imposed upon it or any arbitration award
issued against it pursuant to such Rules and Regulations.
(10) to consent to the disciplinary jurisdiction of the Exchange for five years
after regularity lapses for conduct pertaining to regularity which occurred
while the firm was regular.
__________________________________
Company
By __________________________________
Title
Bond in the amount of________________ duly filed_________________________
Date
__________________________________
Secretary
This application is approved and a Declaration of Regularity is granted by the
Board of Trade of the City of Chicago.
____________________________
Date
______________________________
Secretary
2-35
(01/01/00)
1186.01 Regular Shippers - (See Appendix 11A) (09/01/94)
[Enlarge/Download Table]
================================================================================
Chapter 12
Soybean Meal
================================================================================
Ch12 Trading Conditions............................................................
1201.00 Authority......................................................
1202.01 Application of Regulations.....................................
1204.01 Unit of Trading................................................
1205.01 Months Traded In...............................................
1206.01 Price Basis....................................................
1207.01 Hours of Trading...............................................
1208.01 Trading Limits.................................................
1208.01A Trading Limits.................................................
1209.01 Last Day of Trading............................................
1210.01 Margin Requirements............................................
1211.01 Disputes.......................................................
1212.01 Position Limits and Reportable Positions.......................
Ch12 Delivery Procedures...........................................................
1236.01 Standards......................................................
1236.02 United States Origin Only......................................
1237.01 Official Chemists..............................................
1238.01 Sampling.......................................................
1239.01 Weighing.......................................................
1241.01 Shipping Plants................................................
1242.01 Deliveries by Soybean Meal Shipping Certificates...............
1243.01 Registration of Soybean Meal Shipping Certificates.............
1243.02 Reissuance of Shipping Certificates............................
1244.01 Certificate Format.............................................
1245.01 Lost or Destroyed Negotiable Warehouse Receipts................
1246.01 Date of Delivery...............................................
1247.00 Delivery Notice................................................
1247.01 Delivery Notices...............................................
1248.00 Method of Delivery.............................................
1249.00 Time of Delivery, Payment, Form of Delivery Notice.............
1249.01 Billing........................................................
1249.02 Buyers' Report of Eligibility to Receive Delivery..............
1249.03 Sellers' Invoice to Buyers.....................................
1249.04 Payment........................................................
1250.00 Duties of Members..............................................
1251.01 Office Deliveries Prohibited...................................
1254.00 Failure to Accept Delivery.....................................
1256.01 Payment of Premium Charges.....................................
1256.03 Payment of Fees................................................
Ch12 Regularity of Issuers of Shipping Certificates................................
1290.01 Loading and Shipment of Meal Against Soybean Meal
Shipping Certificates..........................................
1291.01 Conditions of Regularity.......................................
1294.01 Revocation, Expiration or Withdrawal of Regularity.............
1295.01 Application for Declaration of Regularity......................
1296.01 Regular Shippers...............................................
================================================================================
Chapter 12
Soybean Meal
================================================================================
Ch12 Trading Conditions
1201.00 Authority - On and after August 1,1951, trading in Soybean Meal
futures may be conducted under such terms and conditions as may be prescribed by
Regulation. 802 (09/01/94)
1202.01 Application of Regulations - Transactions in Soybean Meal futures
shall be subject to the general Rules of the Association as far as applicable
and shall also be subject to the Regulations contained in this Chapter which are
exclusively applicable to trading in Soybean Meal. 2051 (09/01/94)
1204.01 Unit of Trading - The unit of trading for Soybean Meal shall be 100
tons (2,000 pounds per ton). Bids and offers may be accepted in lots of 100 tons
of multiples thereof. 2056 (09/01/94)
1205.01 Months Traded In - Trading in Soybean Meal may be conducted in the
current month and any subsequent months. 2057 (09/01/94)
1206.01 Price Basis - All prices of soybean meal shall be basis free on board
cars, bulk; Decatur, Illinois, in multiples of 10 cents per ton. Contracts shall
not be made on any other price basis. 2058 (09/01/94)
1207.01 Hours of Trading - The hours of trading for future delivery in Soybean
Meal shall be from 9:30 A.M. to 1:15 P.M. except on the last day of trading in
an expiring future the hours with respect to such future shall be from 9:30 A.M.
to 12 o'clock noon subject to the provisions of the second paragraph of Rule
1007.00. Market shall be opened and closed with a public call made month by
month, conducted by such persons as the Regulatory Compliance Committee shall
direct. 2061 (09/01/94)
1208.01 Trading Limits - (See 1008.01) (09/01/94)
1208.01A Trading Limits - (See 1008.01A) (09/01/94)
1209.01 Last Day of Trading - No trades in Soybean Meal futures deliverable in
the current month shall be made after the business day preceding the 15th
calendar day of that month. Any contracts remaining open after the last day of
trading must be either:
(a) Settled by delivery no later than the second business day following the
last trading day (tender on business day prior to delivery).
(b) Liquidated by means of a bona fide exchange of futures for the actual cash
commodity, no later than the business day following the last trading day.
2063 (01/01/00)
1210.01 Margin Requirements - (See Regulation 431.03) 2065 (09/01/94)
1211.01 Disputes - All disputes between interested parties may be settled by
arbitration as provided in the Rules and Regulations. 2066 (09/01/94)
1212.01 Position Limits and Reportable Positions - (See 425.01) (09/01/94)
Ch12 Delivery Procedures
1236.01 Standards - The contract grade for delivery on futures contracts made
under these Regulations shall be Soybean Meal in bulk which conforms to the
following specifications:
48% Protein Soybean Meal, produced by conditioning ground soybeans and reducing
the oil content of the conditioned product by the use of hexane or homologous
hydrocarbon solvents. Standard specifications are:
----------------------------------------------------------------
Protein minimum 48.0%
----------------------------------------------------------------
Fat minimum 0.5%
----------------------------------------------------------------
Fiber maximum 3.5%
----------------------------------------------------------------
Moisture (when shipped by Processor) maximum 12.0%
----------------------------------------------------------------
It may contain a non-nutritive inert, non-toxic conditioning agent to reduce
caking and improve flowability. In an amount not to exceed that necessary to
accomplish its intended effect, but in no case exceed 0.5%. The name of the
conditioning agent must be shown as an added ingredient.
Testing methods shall be those approved by the Association of Official
Analytical Chemists and American Oil Chemists Society. 2053 (09/01/94)
1236.02 United States Origin Only - Effective September 1, 1992, a futures
contract for the sale of soybean meal shall be performed on the basis of United
States origin only upon written request by a taker of delivery at the time
loading orders are submitted. (09/01/94)
1237.01 Official Chemists - An official Chemist shall be any chemist who is
currently designated as an Official Referee Chemist for Meal by the National
Soybean Processors Association. Certificates of quality analysis by an Official
Chemist shall be binding on all parties. (09/01/94)
1238.01 Sampling - The official sample will be taken at origin by Automatic
Mechanical Sampler (A.O.C.S. Official Method BA 1-38, Rev. 1966) or Pneumatic
Probe Sampler (A.O.C.S. Official Method BA 1-38, Rev. 1966). Shipper shall, on
the next business day after loading, mail a portion of the official sample in an
air tight container properly identified to the owner at an address specified by
the owner when he submits loading orders.
Any shipment testing 12.5% moisture or less based on official sample shall not
be subject to rejection or penalty on account of moisture content. Penalty for
excess moisture:
Excess moisture two times delivered market price on date of shipment for
excess moisture from 12% to 13% and 21-2 times delivered market price on
date of shipment for excess moisture above 13%.
Any shipment testing no more than 0.3% of fiber above the fiber
specification (based on official sample adjusted to 12% moisture) shall
not be subject to rejection or penalty on account of fiber content. When
the amount of fiber exceeds 3.8% (based on official sample adjusted to
12% moisture), the shipment shall be discounted 1.0% of the delivered
market price on date of shipment for each 0.1% fiber in excess of 3.5%.
Any shipment of soybean meal testing within 0.5% of protein below 48%
protein (basis official sample moisture 12.0% or less; protein to be
calculated on 12.0% moisture basis if official sample moisture exceeds
12.0%) shall not be subject to rejection or penalty on account of
protein content. Protein deficiency claims shall be settled between the
parties on the basis of two times the delivered market price per unit of
protein on date of shipment and shall be calculated on the same moisture
basis as for protein rejection.
If the owner's analysis of the official sample indicates quality deficiency, the
owner shall submit his analysis and claim in writing to the shipper within 30
days after arrival of car. The shipper shall, within five (5) business days,
after receipt of the owner's analysis and claim, report his analysis of the
official sample to the owner. In the event that the owner and the shipper do not
reach agreement on analysis and/or settlement, the third portion of the official
sample shall be sent to an Official Chemist and his analysis will be binding
upon both parties for final settlement. The expense of the analysis will be
borne
Ch12 Delivery Procedures
------------------------
by the party in error.
If the owner and the shipper cannot agree that the official sample is
representative of the shipment, a representative sample shall be obtained at
destination by a disinterested qualified person mutually agreed upon by the
owner and shipper. Such destination sample must be obtained within 24 hours of
arrival and prior to unloading. "Constructive placement" shall be considered
arrival at destination. The official procedure for sampling at destination shall
be the Pneumatic Probe Sampler. (A.O.C.S. Method BA 1-38, Rev. 1966) and the
sample shall be submitted to an official chemist. The results of his analysis of
the destination sample shall be binding on both parties for final settlement.
The expense of such sampling and analysis, shall be borne by the owner if the
owner insists on destination sampling and analysis unless the shipper has failed
to take an official sample at origin, in which event, the expense of taking and
analyzing the destination sample shall be borne by the shipper. (09/01/94)
1239.01 Weighing - Weighing and official weights, as defined in the National
Soybean Processors Association Trading Rules for the Purchase and Sale of
Soybean Meal, shall be binding on all interested parties. (09/01/94)
1241.01 Shipping Plants - Soybean Meal Shipping Certificates shall specify
shipment from one of the plants currently regular for delivery and located in
Central Territory, Northeast Territory, Mid South Territory, Missouri Territory,
Eastern lowa Territory, or Northern Territory as defined in this Regulation.
The Exchange may declare additional shipping plants regular for delivery which
shall apply on all contracts outstanding or made thereafter.
SHIPPING PLANTS
(a) All loadings of soybean meal against Soybean Meal Shipping Certificates
shall be in bulk free on board railroad cars at shipping plants.
(b) Payment for Shipping Certificates issued in "Central Territory" (viz.:
shipping plants located in Illinois and Kentucky) will be at contract
price.
(c) Payment for Shipping Certificates issued in "Northeast Territory" (viz.:
shipping plants located in Indiana and Ohio) will be at a premium of $1.50
per ton over contract price.
(d) Payment for Shipping Certificates issued in "Mid South Territory" (viz.:
shipping plants located in all of Tennessee and Arkansas and that part of
Mississippi and Alabama north of a line extending eastward from the
Arkansas and Louisiana border) will be at a premium of $6.50 per ton over
contract price.
(e) Payment for Shipping Certificates issued in "Missouri Territory" (viz.:
shipping plants located in Missouri) will be at a premium of $1.00 per ton
over contract price.
(f) Payment for Shipping Certificates issued in "Eastern lowa Territory" (viz.:
shipping plants located in lowa on and South of the main line of the
Illinois Central Gulf RR from Dubuque, lowa to lowa Falls, lowa; and on and
East of the main line of the Chicago Rock Island RR from lowa Falls to the
Chicago & Northwestern RR from Des Moines through Blockton, lowa) will be
made at a discount of $4.50 per ton under contract price.
(g) Payment for Shipping Certificates issued in "Northern Territory" (viz.:
shipping plants located in that portion of lowa not included in "Eastern
lowa Territory") will be at a discount of $4.00 per ton under contract
price.
(h) For a given soybean crop year ending August 31 and a given Soybean Meal
futures delivery territory except the "Central Territory," when the weekly
(as of Friday) cumulative average ratio of outstanding Soybean Meal
Shipping Certificates to CBOT maximum 24 hour soybean meal production
capacity within that Soybean Meal futures delivery territory, relative to
that ratio for the combined remaining Soybean Meal territories, is less
than or equal to 0.5, payment for Shipping Certificates issued from that
territory will be at a premium of $.50 per ton over contract price in
addition to the territorial delivery differential adjustment.
(i) For a given soybean crop year ending August 31, when the "Central
Territory's" weekly (as of Friday) cumulative average ratio of outstanding
Soybean Meal Shipping Certificates to maximum
Ch12 Delivery Procedures
------------------------
CBOT 24 hour soybean meal production capacity within the Central Soybean
Meal futures delivery territory, relative to that ratio for the combined
remaining Soybean Meal territories, is less than or equal to 0.5, payment
for Shipping Certificates issued from all other territories will be at a
discount of $.50 per ton under contract price in addition to the
territorial delivery differential adjustments.
(j) For a given soybean crop year ending August 31 and a given Soybean Meal
futures delivery territory except the "Central Territory," when the weekly
(as of Friday) cumulative average ratio of outstanding Soybean Meal
Shipping Certificates to CBOT maximum 24 hour soybean meal production
capacity within that Soybean Meal futures delivery territory, relative to
that ratio for the combined remaining Soybean Meal territories, is greater
than or equal to 2.0, payment for Shipping Certificates issued from that
territory will be at a discount of $.50 per ton under contract price in
addition to the territorial delivery differential adjustment.
(k) For a given soybean crop year ending August 31, when the "Central
Territory's" weekly (as of Friday) cumulative average ratio of outstanding
Soybean Meal Shipping Certificates to CBOT maximum 24 hour soybean meal
production capacity within the Central Soybean Meal futures delivery
terriory, relative to that ratio for the combined remaining Soybean Meal
territories, is greater than or equal to 2.0, payment for Shipping
Certificates issued from all other territories will be at a premium of $.50
per ton over contract price in addition to the territorial delivery
differential adjustments.
*(l) Items (h) through (k) of Regulation 1241.01 shall apply to all CBOT Soybean
Meal futures contracts delivered during a one calendar year period
beginning with January following the soybean crop year ending August 31,
provided that there are on a weekly average at least 150 CBOT outstanding
Soybean Meal Shipping Certificates in all Soybean Meal delivery territories
combined during that previous soybean crop year.
(m) Based on the adjustments made to territorial delivery differentials during
a given calendar year as outlined in items (h) through (I) of Regulation
1241.01, the CBOT shall announce and publish by September 15 of that given
calendar year new territorial delivery differentials applicable to all
Soybean Meal futures contracts delivered during the next calendar year.
(01/01/00)
1242.01 Deliveries by Soybean Meal Shipping Certificates - Deliveries of
Soybean Meal shall be made by delivery of Soybean Meal Shipping Certificates
issued by Shippers designated by the Exchange as regular to issue Soybean Meal
Shipping Certificates for Soybean Meal. In order to effect a valid delivery each
Soybean Meal Shipping Certificate must be endorsed by the holder making the
delivery. Such endorsement shall constitute a warranty of the genuineness of the
Certificate and of good title thereto, but shall not constitute a guaranty, by
any endorser, of performance by the issuer of the Certificate. 2067 (09/01/94)
1243.01 Registration of Soybean Meal Shipping Certificates - Soybean Meal
Shipping Certificates in order to be eligible for delivery must be registered
with the Official Registrar and in accordance with the requirements issued by
the Registrar, must not be more than six months old and must not have an
expiration date in the month in which they are delivered. Registration of
Soybean Meal Shipping Certificates shall also be subject to the following
requirements:
(a) Shippers who are regular for delivery may register certificates at any
time. The holder of a registered certificate may cancel its registration at
any time. A certificate which has been cancelled may not be registered
again.
(b) No notice of intention to deliver a certificate shall be tendered to the
Clearing House unless said certificate is registered and in the possession
of the Clearing House member tendering the notice or unless a shipping
certificate is registered and outstanding.
(c) When a notice of intention to deliver a certificate has been tendered to
the Clearing House, said certificate shall be considered to be
"outstanding" until its registration is cancelled. The member issuing such
notice shall transmit to the Registrar, at the same time the notice is
tendered to the Clearing House, the certificate number and the name of the
registered shipper. From this information and his own records of
registration and of cancellations of outstanding certificates, the
Registrar shall maintain a current record of the number of Central
certificates, Northeast certificates, Mid South certificates, Missouri
certificates, Eastern lowa certificates and Northern
Ch12 Delivery Procedures
------------------------
certificates that are outstanding and shall be responsible for posting this
record on the Exchange Floor. (See Regulation 1241.01 for a definition of
the territories.)
(d) When a registered shipper regains control of an outstanding certificate
calling for shipment from one of his plants, which in any manner relieves
him of the obligation to ship meal upon demand of a party other than
himself, the shipper shall cancel the registration of said certificate by
noon of the next business day except in the case where a notice of
intention to redeliver said certificate for the shipper has been tendered
to the Clearing House by 4:00 p.m. of the day that the shipper regained
control of said certificate.
(e) The Registrar shall not divulge any information concerning the
registration, delivery or cancellation of certificates other than the
record posted on the Exchange Floor, except that he shall issue a weekly
report showing the total number of certificates outstanding as of 4:00 P.M.
on the last trading day of each week. In addition to the information posted
on the Exchange Floor, this weekly report will show the names of shippers
whose certificates are outstanding and the location of the shipping plants
involved. 2069 (09/01/94)
1243.02 Reissuance of Shipping Certificates - Every Soybean Meal Shipping
Certificate must be returned to the shipper, or his agent, for reissuance prior
to its becoming six months old. At such time accrued premium charges shall be
paid and the Shipper shall be obligated to provide the owner with a new and duly
registered Soybean Meal Shipping Certificate. 2070
Every Soybean Meal Shipping Certificate which is not returned to the shipper, or
his agent, for reissuance prior to its becoming six months old, will be subject
to the late charge which will be paid to the shipper by the owner on the day
that the accrued premium charges are paid. The late charge will be an amount
equal to the total unpaid accumulated premium charges multiplied by the "prime
interest rate" in effect on the day that the accrued premium charges are paid
multiplied by the number of calendar days that the certificate is past due,
divided by 360 days. The term "prime interest rate" shall mean the lowest of the
rates announced by each of the following four banks at Chicago, Illinois as its
"prime rate": Continental Illinois National Bank and Trust Company of Chicago,
The First National Bank of Chicago, Harris Trust and Savings Bank and the
Northern Trust Company. The number of calendar days that the certificate is past
due shall be the number of days beginning with the day that the shipping
certificate is six months old and continuing through the business day that the
certificate is returned to the shipper or his agent. 2070 (09/01/94)
1244.01 Certificate Format - The following form of Soybean Meal Shipping
Certificate shall be used with proper designation, indicating Central Territory,
Northeast Territory, Mid South Territory, Missouri Territory, Eastern lowa
Territory or Northern Territory.
BOARD OF TRADE OF THE CITY OF CHICAGO
SOYBEAN MEAL SHIPPING CERTIFICATE FOR DELIVERY
IN SATISFACTION OF CONTRACT FOR 100 TONS
(2,000 POUNDS EACH) OF SOYBEAN MEAL
This certificate not valid unless registered by the Registrar
of the Board of Trade of the City of Chicago.
____________________________________________________________
48% Protein Soybean Meal
Shipping Plant of___________________________________________
Located at__________________________________________________
Registered total daily rate of loading of_________ tons.
Total rate of loading per day shall be in accordance with
Regulation 1290.01 (c) and (d). A premium charge of 7 cents
per ton per calendar day for each day is to be assessed
starting the day after registration by the Registrar of this
Certificate. When loading orders specify rail shipment within
four days, the premium charge shall continue through the
business day following receipt of loading orders; otherwise,
the premium charge shall continue through the day of loading.
In the case of shipment by truck, the premium charge shall
continue through the day of loading.
For value received and receipt of this document properly
endorsed and lien for payment of premium charges the
undersigned shipper, regular for delivery under the Rules and
Regulations of the Board of Trade of the City of Chicago,
hereby agrees to deliver 100 tons (2,000 pounds each) of
Soybean Meal in bulk conforming to the standards of the Board
of Trade of the City of Chicago and ship said Soybean Meal in
accordance with orders of the lawful owner of this document
and in accordance with Rules and Regulations of the Board of
Trade of the City of Chicago. Delivery shall be by covered
hopper car or truck according to the registered loading
capability of the
Ch12 Delivery Procedures
------------------------
shipper.
Signed at___________________________ this________________________
day of____________________________________, 20___________________
__ Central Territory
__ Northeast Territory
__ Mid South Territory
__ Missouri Territory
__ Eastern lowa Territory
__ Northern Territory _________________________________
By________________________________
Authorized Signature of Issuer
Registration date____________________
Registrar's Number___________________ ___________________________
Registrar for Soybean Meal
Board of Trade of the City of Chicago
Registration cancelled for purpose of shipment of Soybean Meal by owner
of certificate or by issuer of certificate for purpose of withdrawal of
certificate.
Cancellation Date_________________________ _____________________
Registrar
All premium charges have been paid on Soybean Meal covered by this
certificate from date of registration, not counting date of registration
but counting date of payment.
Date_________________ by___________________
Date__________________ by___________________
Date__________________ by___________________
Date__________________ by___________________
Delivery of this Soybean Meal Shipping Certificate to issuer is
conditioned upon loading of Soybean Meal in accordance with Rules and
Regulations of the Board of Trade of the City of Chicago and a lien is
claimed until all loadings are complete and proper shipping documents
presented accompanying demand draft for freight and premium charges due
which I (we) agree to honor upon presentation.
________________________________________
Owner of this Soybean Meal Shipping
Certificate or his duly authorized agent
Date___________________, 20________ 2080
(01/01/00)
1245.01 Lost or Destroyed Negotiable Warehouse Receipts - (See Regulation
1045.01) (04/01/00)
1246.01 Date of Delivery - Delivery of Soybean Meal Shipping Certificates may
be made by the Seller upon any permissible delivery day of the delivery month
but no later than the second business day following the last day of trading in a
delivery month. 2072 (09/01/94)
1247.00 Delivery Notice - (See 1047.00) (09/01/94)
1247.01 Delivery Notices - (See 1047.01) (09/01/94)
1248.00 Method of Delivery - (See 1048.00) (09/01/94)
1249.00 Time of Delivery, Payment, Form of Delivery Notice - (See 1049.00)
(09/01/94)
1249.01 Billing - (See 1241.01) (09/01/94)
1249.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
1249.03 Sellers' Invoice to Buyers - (See 1049.03) (09/01/94)
1249.04 Payment - Payment is to be made by a check drawn on and certified by a
Chicago bank or by a Cashier's check issued by a Chicago Bank. 2073 (09/01/94)
Ch12 Delivery Procedures
------------------------
1250.00 Duties of Members - (See 1050.00) (09/01/94)
1251.01 Office Deliveries Prohibited - No office deliveries of soybean meal
shipping certificates may be made by Members of the Clearing Corporation. Where
a commission house as a Member of the Clearing Corporation has an interest in
both long and short for customers on its own books, it must tender to the
Clearing Corporation such notices of intention to deliver as it receives from
its customers who are short. 2064 (09/01/94)
1254.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
1256.01 Payment of Premium Charges - No Soybean Meal Shipping Certificates
shall be valid for delivery on future contracts unless the premium charges shall
have been paid up to and including the 18th day of the preceding month and such
payment endorsed on the Soybean Meal Shipping Certificate unless registration is
at a later date. Unpaid accumulated premium charges shall be allowed and
credited to the Buyer by the Seller to and including the date of delivery. 2068
(09/01/94)
1256.03 Payment of Fees - All outloading fees, including weighing, to load
Soybean Meal into railroad car, are to be paid by issuer of Soybean Meal
Shipping Certificate. 2075 (09/01/94)
Ch12 Regularity of Issuers of Shipping Certificates
1290.01 Loading and Shipment of Meal Against Soybean Meal Shipping
Certificates -
(a) The operator of a shipping plant issuing Soybean Meal Shipping Certificates
shall limit the number of Shipping Certificates issued to an amount not in
excess of 15 times its registered total daily rate of loading plus the
amount of meal or flakes in store (not limited to meal meeting minimum
contract standards). All such meal or flakes in store must be stored in
facilities for which the capacity has been registered with the Board of
Trade and which have been inspected by the Registrar. The shipper shall
register his total daily rate of loading covered hopper cars at not less
than 40% nor more than 100% of his maximum 24 hour soybean meal production
capacity. Each plant must be regular for a minimum total daily rate of
loading of 200 tons per day.
(b) Each regular plant must also register a daily rate of loading for truck. The
daily rate of loading for truck must be registered at not less than 40% of
the registered total daily rate of loading for the plant.
(c) Each regular plant shall be required to load-out soybean meal against
cancelled Shipping Certificates at a daily rate equivalent to the greater of
either its registered total daily rate of loading, or 1/21st of the total
amount of soybean meal represented by Shipping Certificates issued by the
plant but not yet loaded.
(d) Each regular plant shall be required to load covered hopper cars against
Shipping Certificates at a rate not greater than that established in
paragraph (c), and trucks at a rate not greater than that determined by
multiplying the rate established in paragraph (c) by the share of the
registered total daily rate of loading registered by the plant as its daily
rate of loading for truck. However, on days when rail and truck loading
against Shipping Certificates takes place concurrently, the required daily
rate of loading into each conveyance shall be determined by prorating the
rate established in paragraph (c).
(e) The shipper shall assess a premium charge of 7 cents per ton per calendar
day for each day a Soybean Meal Shipping Certificate is outstanding starting
the day after the date of registration by the Registrar. When rail loading
orders specify shipment within four business days the premium charge shall
continue through the business day following the receipt of loading orders.
Otherwise, the premium charge shall continue through the day of rail
loading. "Business days" are those on which the Exchange is open for trading
Soybean Meal. In the case of shipment by truck, the premium charge shall
continue through the day of loading.
(f) The shipper shall maintain, in the immediate vicinity of the Exchange,
either an office, or a duly authorized representative or agent approved by
the Exchange, where owners of Shipping Certificates may pay premium charges,
surrender properly endorsed Shipping Certificates for cancellation and file
loading orders and shipping instructions.
(g) Rail Loading Procedures
(1) The owner requesting rail load-out will furnish written rail loading
orders and shipping instructions to the shipper by the close of business
on the first business day following the date of cancellation of the
Shipping Certificates in the Registrar's office. The loading orders
shall specify if rail equipment will be the owner's (including leased
cars) or shall specify the owner's election as to the type and size of
covered hopper car to be ordered by the shipper. The shipper will load
covered hopper cars with a capacity of 75 tons or larger. Loadings will
be in bulk, and shipments will be subject to the existing freight tariff
Rules and Regulations of the railroads on file with the Interstate
Commerce Commission at the time of loading. The shipper is responsible
for loading suitable railroad owned or leased cars or owner's cars
(including leased cars) which are available for loading at the facility.
Owner and shipper will cooperate to ensure timely placement and loading
of rail equipment or alternate shipping modes.
(2) All loading orders and shipping instructions received prior to 2:00 p.m.
on a given business day shall be considered dated that day and shall be
entitled to equal treatment. Orders received after 2:00 p.m. on a
business day shall be considered dated the following business day.
Loading against all rail loading orders dated on a given business day
shall be
Ch12 Regularity of Issuers of Shipping Certificates
---------------------------------------------------
completed before loading begins on any rail loading orders dated on a
subsequent business day subject to the provisions of subparagraph 4 of
this paragraph.
(3) When rail loading orders and shipping instructions are received by 2:00
p.m. of any given business day, the shipper will advise the owner by
10:00 a.m. the following business day of loading dates and tonnage due.
Notification will be by telephone, telex or telefax.
(4) When a shipper has received one or more rail loading orders and shipping
instructions, he shall begin loading against them within 4 business days
following their receipt, unless the owner requests a deferred loading
date in his loading orders. When loadings against rail loading orders
cannot be completed on the fourth following business day of their
receipt, the shipper shall continue loading against such loading orders
on each calendar day thereafter. Shipping instructions are to be
provided to the Shipper by the owner 2 business days before loading is
to begin. The shipper shall load at the rate specified in paragraph (d)
of this Regulation.
(5) When loading against rail loading orders and shipping instructions
received by a shipper prior to 2:00 p.m. on a given business day cannot
be completed by the fourth following business day, the shipper shall
allocate daily loadings against such loading orders as equitably as
possible on a pro-rata basis. Starting of loading against small orders
may be delayed until the first day when pro-ration entitles such an
order to an allocation of a full car, but in such a case loading of the
last car against the order shall be accelerated by the same number of
days as loading of the first car was delayed.
(6) The shipper shall load cars at the shipping plant designated in the
Shipping Certificate. If it becomes impossible to load at the designated
shipping plant because of an Act of God, fire, flood, wind, explosion,
war, embargo, civil commotion, sabotage, law, act of government, labor
difficulties or unavoidable mechanical breakdown, the shipper will
arrange for covered hopper cars to be loaded at another regular shipping
plant in conformance with the Shipping Certificate and will compensate
the owner for any transportation loss resulting from the change in the
location of the shipping plant. If the aforementioned condition of
impossibility prevails at a majority of regular shipping plants, then
shipment may be delayed for the number of days that such impossibility
prevails at a majority of regular shipping plants.
(7) Rail loading orders involving one or more Shipping Certificates shall be
considered as one lot. The minimum amount shipped against each loading
order shall be the number of Shipping Certificates specified therein
times 100 tons. A tolerance of 5 tons over the total may be shipped to
be settled at the market price at the time of shipment of the last car
of the order.
(8) Rail cars must be loaded to "full visible capacity" unless tonnage on
cancelled shipping certificates does not cover rail car capacity.
(9) The owner will be responsible for whatever demurrage costs that are
involved in loading multiple car or trainload shipments. All demurrage
charges must be substantiated with a citation of car numbers loaded
against cancelled Shipping Certificates either by proper notations on
the shipper's average demurrage agreement with the carrier or actual
demurrage bills rendered against cars shipped. 2078
(h) Truck Loading Procedures
(1) The owner requesting truck load-out shall furnish written loading orders
and shipping instructions to the shipper by the close of business on the
first business day following the date of cancellation of Shipping
Certificates in the Registrar's Office. The owner shall supply the
trucks. Open-top trucks with a minimum capacity of 20 tons must be
provided. No vans or trucks with porthole loading shall be acceptable.
Owner and shipper shall cooperate to ensure timely placement and loading
of truck equipment.
(2) All truck loading orders and shipping instructions received prior to
2:00 p.m on any given business day shall be considered dated that day
and shall be entitled to equal treatment. Orders received after 2:00
p.m. on a business day shall be considered dated the following business
day.
Ch12 Regularity of Issues of Shipping Certificates
--------------------------------------------------
(3) When truck loading orders and shipping instructions are received by
2:00 p.m. on any given business day, the shipper will advise the owner
of loading dates and tonnage due by 10:00 a.m. the next business day.
Notification will be by telephone, telex or telefax.
(4) The shipper shall begin loading against truck loading orders and
shipping instructions on the fourth business day after their receipt.
The shipper shall load at the rate specified in paragraph (d) of this
Regulation.
(5) Truck loading shall occur during normal truck loading hours, as
declared in the plant's application for regularity, and on normal
business days. "Normal business days" shall be those on which the
Exchange is open for trading Soybean Meal futures.
(6) A premium of $3.50/ton shall be applied to all shipments of meal
loaded out by truck and shall be payable when shipping orders are
filed.
(7) The owner shall present his trucks for loading at the shipping plant
designated in the Shipping Certificate by 12:00 noon on the scheduled
loading day. If trucks arrive by 12:00 noon, the shipper shall load
the same day or be subject to the penalties and procedures specified
in subparagraphs (10) and (11) of this paragraph (Truck Loading
Procedures). If trucks arrive after 12:00 noon, the shipper shall be
under no obligation to load and the owner shall be subject to the
penalties and procedures specified in subparagraphs (8) and (9) of
this paragraph.
(8) If the owner fails to present his trucks on time on the scheduled
loading day, he shall be subject to a grace period until 12:00 noon
the next business day and shall not be liable for a penalty up to that
time. If the owner fails to present his trucks by 12:00 noon of the
business day following the scheduled loading day, he shall be liable
for a penalty of $4/ton/day for all meal not loaded out as scheduled.
(9) If, for any reason, the owner is unable to present his trucks for
three consecutive normal business days, beginning with the originally
scheduled loading day, the shipper may at his election:
i) Load the meal into rail cars for the owner and inform him of rail
car numbers, or
ii) Reissue a Shipping Certificate to the owner. If a Shipping
Certificate is reissued, the premium charge specified in paragraph
(e) of this Regulation shall be assessed retroactively, beginning
the day after the business day following the receipt of loading
orders.
In these cases the owner is liable for the penalty specified in
subparagraph (8) of this paragraph, if any, for two business days. The
truck loading premium specified in subparagraph (6) of this paragraph
shall be credited against any penalties due or refunded in full if
there are no penalties due. If shipper elects either of these options
he must promptly notify the owner.
(10) If the shipper fails to load the owner's trucks by 12:00 midnight on
the scheduled loading day he shall be subject to a grace period until
the next business day and shall not be subject to a penalty up to that
time. If the shipper fails to load the owner's truck by 12:00 midnight
of the business day following the scheduled loading day, he shall be
liable for a penalty of $4/ton/day for all meal not loaded out as
scheduled.
(11) If, for any reason, the shipper is unable to load the owner's trucks
for three consecutive normal business days, beginning with the
originally scheduled loading day, the shipper shall, with the owner's
consent, make the meal available for truck load-out on the third day
at another regular plant, in conformance with the Shipping
Certificate, and will compensate the owner for any transportation loss
resulting from the change in the location of the shipping plant.
(12) A tolerance of five tons over the total truck shipment may be loaded
and settled at the market price at the time the last truck is loaded.
(i) Change of Election for Mode of Load-Out Due to Unavailability of Rail Cars
Ch12 Regularity of Issuers of Shipping Certificates
---------------------------------------------------
The owner may elect to amend rail loading orders to load-out by truck in the
event of rail car unavailability. Rail loading orders amended in this manner
shall be entitled to equal treatment. A premium of $3.50/ton shall be
applied to all shipments of meal loaded-out by truck and shall be payable on
the day loading orders were amended to specify the owner's election for
load-out by truck.
(j) Certification of Soybean Meal - Effective September 1, 1992 and upon written
request by a taker of delivery at the time loading orders are submitted for
the delivery of soybean meal against canceled shipping certificates, the
shipper shall certify in writing to the taker of delivery on the day that
the transportation conveyance is loaded that the soybean meal is produced
from soybeans of U.S. origin only. Shipping certificates issued prior to
September 1, 1992 will be deliverable against futures contracts beginning
September 1992 only if the regular shipper provides certification on the
shipping certificate that the U.S. origin-only option is available to the
taker of delivery of soybean meal. (05/01/95)
1291.01 Conditions of Regularity - Persons operating Soybean Meal Shipping
Plants who desire to have such plants made regular for delivery of Soybean Meal
under the Rules and Regulations shall make application for an initial
Declaration of Regularity on a form prescribed by the Board prior to May 1,
1994, and every even year thereafter, for a two year term beginning the
following July 1, 1994, and every even year thereafter, and at any time during a
current term for the balance of that term. Regular Soybean Meal Shipping Plants
who desire to increase their regular capacity during a current term shall make
application for the desired amount of total regular capacity on the same form.
Initial regularity for the current term and increases in regularity shall be
effective either thirty days after a notice that a bona fide application has
been received is posted on the floor of the exchange, or the day after the
application is approved by the Exchange, whichever is later. Applications for
renewal of regularity must be made prior to May 1, 1994, and every even year
thereafter, for the respective years beginning July 1, 1994, and every even year
thereafter and shall be on the same form.
The following shall constitute the requirements and conditions of regularity:
1. The plant of the shipper making application shall be inspected by the
Exchange.
2. Such shipping plant shall be connected by railroad tracks with one or more
railway lines.
3. The operator or manager of such shipping plant shall be in good financial
standing and credit, and shall meet the minimum financial requirements and
financial reporting requirements set forth in Appendix 4E. No shipping plant
shall be declared regular until the person operating the same files a bond
with sufficient sureties in such sum and subject to such conditions as the
Exchange may require.
4. Such shipping plant shall be provided with standard equipment and appliances
for the convenient and expeditious shipping of Soybean Meal in bulk in the
conveyances for which the plant is registered with the Exchange according to
Regulation 1290.01 (a) and (b).
5. The operator or manager of such shipping plant shall honestly and cordially
cooperate with the system of registration of Soybean Meal Shipping
Certificates for Soybean Meal to be shipped in satisfaction of deliveries on
futures contracts.
6. No shipper shall engage in any unethical or inequitable practice or fail to
comply with any law, Federal or State, or any rule or regulation promulgated
thereunder.
7. The shipper shall make such reports, keep such records, and permit such
processing plant visitations as the Secretary of Agriculture may prescribe,
and shall comply with all applicable Rules and Regulations and orders
promulgated by the Secretary of Agriculture or the government agency
administering the Commodity Exchange Act, and shall comply with all
requirements made by the Exchange because of such Rules and Regulations or
orders.
8. The plant must not have been continuously out of operation for the two
consecutive years prior to application for regularity or renewal thereof.
9. The operator or manager of such shipping plant shall accord every facility
to the Exchange for the examination of the facility and the stocks of
soybean meal which may be on hand at any time. Such examination may be made
at any time.
Ch12 Regularity of Issuers of Shipping Certificates
---------------------------------------------------
10. Soybean Meal inventory which is covered by shipping certificates tendered
for delivery shall be insured against the contingencies provided for in a
standard "All Risks" policy (including earthquake) to such an extent and in
such amounts as required by the Exchange. The shipper shall furnish the
Exchange with either a copy of the current insurance policy or policies, or
a written confirmation from the insurance company that such insurance has
been effected.
11. The operator or manager of such shipping plant shall be subject to the
Association's Rules and Regulations pertaining to arbitration procedures, as
set forth in Chapter 6, and, with respect to compliance with Rules and
Regulations pertaining to a shipping plant's regularity, shall be subject to
the Association's Rules and Regulations pertaining to disciplinary
procedures, as set forth in Chapter 5. 2077
12. The operator or manager of such shipping plant shall consent to the
disciplinary jurisdiction of the Exchange for five years after such
regularity lapses, for conduct pertaining to regularity which occurred while
the shipping plant was regular. (09/01/94)
1294.01 Revocation, Expiration or Withdrawal of Regularity - Any regular
shipper may be declared irregular at any time if he fails to carry out the
duties of delivery by Soybean Meal Shipping Certificate as prescribed by these
Regulations or violate any conditions of regularity. If designation of a shipper
as regular shall be revoked, the Exchange shall announce such revocation on the
bulletin board of the Exchange and also the period of time, if any, during which
the Soybean Meal Shipping Certificates issued by such shipper shall thereafter
be deliverable in satisfaction of futures contracts in Soybean Meal under the
Rules and Regulations.
In the event of revocation, expiration or withdrawal of regularity, or in the
event of sale or abandonment of the properties where regularity is not reissued,
holders of outstanding shipping certificates shall be given thirty days to take
load-out of the commodity from the facility. If a holder of an outstanding
shipping certificate chooses not to take load-out during this period, the
facility must provide him with another shipping certificate at another, mutually
acceptable regular shipping plant, with adjustments for differences in contract
differentials. Alternatively, if such shipping certificate is unavailable, the
facility must provide the holder with an equivalent quantity and quality of the
soybean meal designated in the shipping certificate at a mutually acceptable
location. 2079 (09/01/94)
1295.01 Application for Declaration of Regularity - All applications by
operators of shipping plants for a Declaration of Regularity under Regulation
1291.01 shall be on the following form:
SHIPPER'S APPLICATION FOR A DECLARATION OF REGULARITY
FOR THE DELIVERY OF SOYBEAN MEAL UPON CONTRACTS FOR
FUTURE DELIVERY UNDER THE CHARTER RULES AND REGULATIONS OF
THE BOARD OF TRADE OF THE CITY OF CHICAGO
_______________,20________
BOARD OF TRADE OF THE CITY OF CHICAGO
Chicago, Illinois
Gentlemen:
We, the______________________________________ (hereinafter
called Shipper), owner or lessee of the__________________
located at________________________ having a maximum 24 hour
crushing capacity of____________ bushels of soybeans per day
multiplied by the factor 0.022 for a maximum 24 hour production
capacity of_______________ tons of Soybean Meal per day, having
storage capacity for_________ tons of Soybean Meal, and
applying_____________ tons as a registered total daily rate of
loading (not less than 40% nor more than 100% of his maximum 24
hour production capacity of soybean meal and a minimum of 200
tons of regularity per day), (______ % of which shall be the
registered daily rate of loading for truck. *Minimum 40%), as
the basis of calculation for the purpose of Regulations 1290.01
(a) 1290.01 (c) and 1290.01 (d), do hereby make application to
the Board of Trade of the City of Chicago (herein after called
Exchange), for a Declaration of Regularity to issue Soybean Meal
Shipping Certificates for the Delivery of Soybean Meal upon
contracts for future delivery for a period beginning July
1,_________ and ending Midnight, June 30,___________. __ Central
Territory __ Mid South Territory __ Eastern Iowa Territory __
Northeast Territory __ Missouri Territory __ Northern Terrritory
* As applicable, normal truck loading hours are______ a.m.
to______ p.m., Central Daylight Saving Time.
Conditions of Regularity
Such declaration of regularity, if granted, shall be cancellable
by the Exchange whenever the following conditions shall not be
observed:
1. The Shipper must:
Ch12 Regularity of Issuers of Shipping Certificates
---------------------------------------------------
(1) give such bonds to the Exchange as it may require.
(2) notify the Exchange immediately of any change in its capital
ownership, of any reduction in total capital of 20 percent or
more from the level reported in the last financial statement
filed with the Exchange, or of any change in the condition of its
shipping facilities.
(3) make such reports, keep such records, and permit such shipping
plant visitation as the Secretary of Agriculture may prescribe;
comply with all applicable Rules and Regulations and orders
promulgated by the Secretary of Agriculture or the Government
agency administering the Commodity Exchange Act; and comply with
all requirements of the Exchange permitted or required by such
Rules and Regulations or orders.
(4) make application for renewal of the declaration of regularity in
writing on or before May 1, 1994, and every even year thereafter.
(5) notify the Exchange immediately of any change in the maximum 24
hour crushing capacity of soybeans at the soybean meal shipping
plant.
2. The Shipping Plant must be:
(1) subject to the prescribed examination and approval of the
Exchange.
(2) connected by railroad tracks to one or more railway lines.
(3) equipped with standard equipment and appliances for the
convenient and expeditious shipping of Soybean Meal in bulk.
3. The Shipping Plant and the Shipper must conform to the requirements of
the Exchange as to location, accessibility and suitability as may be
prescribed in the Rules and Regulations of the Exchange.
Agreements of the Shipper
The Shipper expressly agrees:
(1) that all Soybean Meal tendered in satisfaction of futures contracts
shall be weighed by an Official Weigher of the Exchange.
(2) that all Soybean Meal Shipping Certificates will be registered with
the Registrar of the Exchange.
(3) to fulfill the duties of a shipper issuing Soybean Meal Shipping
Certificates as set forth in the Regulations in the Chapter of the
Rules and Regulations of the Board of Trade of the City of Chicago
pertaining to Soybean Meal.
(4) to abide by the Rules and Regulations of the Exchange applicable to
the issuance of Soybean Meal Shipping Certificates, shipping,
application of billing, standards, and inspection of Soybean Meal.
(5) that the Exchange may cancel said declaration of regularity, if
granted, for any breach of said agreements.
(6) that the signing of this application constitutes a representation that
the conditions of regularity are complied with and will be observed
during the life of the declaration of regularity and, if found to be
untrue, the Exchange shall have the right to cancel said declaration
of regularity immediately.
(7) to be subject to the Association's Rules and Regulations pertaining to
arbitration procedures, as set forth in Chapter 6, and with respect to
compliance with Rules and Regulations pertaining to regularity, to be
subject to the Association's Rules and Regulations pertaining to
disciplinary procedures, as set forth in Chapter 5; and to abide by
and perform any disciplinary decision imposed upon it or any
arbitration award issued against it pursuant to such Rules and
Regulations.
(8) to consent to the disciplinary jurisdiction of the Exchange for five
years after regularity lapses for conduct pertaining to regularity
which occurred while the firm was regular.
____________________________________________
Company
By____________________________________________
Title
Bond in the amount of___________________ duly filed_______________________
Date
__________________________________________
Secretary
This application is approved and a Declaration of Regularity is granted by
the Board of Trade of the City of Chicago.
__________________________________________
Secretary
_____________________________
Date
2081
(01/01/00)
Ch12 Regularity of Issuers of Shipping Certificates
---------------------------------------------------
1296.01 Regular Shippers - (See Appendix 12A) (09/01/94)
[Enlarge/Download Table]
===================================================================================================================
Chapter 13
Oats Futures Options
===================================================================================================================
Ch13 Trading Conditions............................................................................
1301.00 Authority......................................................................
1301.01 Application of Regulations.....................................................
1302.01 Nature of Oats Futures Put Options.............................................
1302.02 Nature of Oats Futures Call Options............................................
1303.01 Trading Unit...................................................................
1304.01 Striking Prices................................................................
1305.01 Payment of Option Premium......................................................
1306.01 Option Premium Basis...........................................................
1307.01 Exercise of Option.............................................................
1307.02 Automatic Exercise.............................................................
1308.01 Expiration of Option...........................................................
1309.01 Months Traded In...............................................................
1310.01 Trading Hours..................................................................
1311.01 Position Limits and Reportable Positions.......................................
1312.01 Margin Requirements............................................................
1313.01 Last Day of Trading............................................................
1314.01 Option Premium Fluctuation Limits..............................................
================================================================================
Chapter 13
Oats Futures Options
================================================================================
Ch13 Trading Conditions
1301.00 Authority - (See Rule 2801.00.) (09/01/94)
1301.01 Application of Regulations - Transactions in put and call options on
Oats futures contracts shall be subject to the general rules of the Association
as far as applicable and shall also be subject to the regulations contained in
this Chapter which are exclusively applicable to trading in put and call options
on Oats futures contracts. (See Rule 490.00) (09/01/94)
1302.01 Nature of Oats Futures Put Options - The buyer of one (1) Oats
futures put option may exercise his option at any time prior to expiration
(subject to Regulation 1307.01), to assume a short position in one (1) Oats
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Oats futures put option
incurs the obligation of assuming a long position in one (1) Oats futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a put option buyer. (09/01/94)
1302.02 Nature of Oats Futures Call Options - The buyer of one (1) Oats
futures call option may exercise his option at any time prior to expiration
(subject to Regulation 1307.01), to assume a long position in one (1) Oats
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Oats futures call option
incurs the obligation of assuming a short position in one (1) Oats futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a call option buyer. (09/01/94)
1303.01 Trading Unit - One (1) Oats futures contract of a specified contract
month on the Chicago Board of Trade 09/01/94)
1304.01 Striking Prices - Trading shall be conducted for put and call
options with striking prices (the "strikes") in integral multiples of ten (10)
cents per bushel per Oat futures contract (i.e., 2.50, 2.60, 2.70, etc.) and in
integral multiples of twenty (20) cents per bushel per Oat futures contract
(i.e., 2.80, 3.00, 3.20, etc.) as follows:
1. a. In integral multiples of ten cents, at the commencement of trading for
an option contract, the following strikes shall be listed: one with a
strike closest to the previous day's settlement price of the underlying
Oat futures contract, the next five consecutive higher and the next
five consecutive lower strikes (the "initial band"). If the previous
day's settlement price is midway between two strikes, the closest price
shall be the larger of the two.
b. In integral multiples of twenty cents, at the commencement of trading
for an option contract, the following strikes shall be listed: the next
four consecutive strikes above the initial band.
c. In integral multiples of ten cents, over time, strikes shall be added
as necessary to insure that all strikes within 55 cents of the previous
day's trading range of the underlying futures contract are listed (the
"minimum band").
d. In integral multiples of twenty cents, over time, strikes shall be
added as necessary to insure that the next four consecutive strikes
above the minimum band are listed.
e. No new strikes may be added by these procedures in the month in which
an option expires.
2. a. In integral multiples of twenty cents, all strikes in which the previous
day's delta factors (as determined by the Board of Trade) for both the
put and call options are 0.10 or greater for two consecutive business
days will be listed for trading. However, no new strikes may be added by
this procedure to an option month unless open positions exist in that
contract month.
b. In integral multiples of ten cents, during the month in which an option
expires, all strikes in which the previous day's delta factors (as
determined by the Board of Trade) for both the put
Ch13 Trading Conditions
-----------------------
and call options are 0.10 or greater for two consecutive business
days will be listed for trading.
3. All strikes will be listed prior to the opening of trading on the
following business day. The Board, or a Committee designated by the
Board, may modify the procedures for the introduction of strikes as it
deems appropriate in order to respond to market conditions. (09/01/94)
1305.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (09/01/94)
1306.01 Option Premium Basis - The premium for Oats futures options shall be in
multiples of one-eighth (1-8) of one cent per bushel of a 5,000 bushel Oats
futures contract which shall equal $6.25 per contract.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $6.00 in $1.00 increments per option contract.
(09/01/94)
1307.01 Exercise of Option - The buyer of an Oats futures option may exercise
the option on any business day prior to expiration by giving notice of exercise
to the Clearing Corporation by 6:00 p.m., or by such other time designated by
the Board of Directors, on such day. Notwithstanding the foregoing, the buyer
may exercise the option prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to
communicate to the member firm exercise instructions or the
member firm's inability to receive such instructions prior to
6:00 p.m. on the last day of trading. (12/01/99)
1307.02 Automatic Exercise - Notwithstanding the provisions of Regulation
1307.01 after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to
communicate to the member firm exercise instructions or the
member firm's inability to receive such instructions prior to
6:00 p.m. on the last day of trading. (12/01/99)
1308.01 Expiration of Option - Unexercised Oats futures options shall expire at
10:00 a.m. on the first Saturday following the last day of trading. (09/01/94)
1309.01 Months Traded In - Trading may be conducted in the nearby Oats futures
options contract month plus any succeeding months, provided however, that the
Board or a Committee authorized by the Board may determine not to list a
contract month. For options that are traded in months in which Oats futures are
not traded, the underlying futures contract is the next futures contract that is
nearest to the expiration of the option. For example, the underlying futures
contract for the February option contract is the March futures contract.
(09/01/00)
1310.01 Trading Hours - The hours of trading of options on Oats futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as the
close of trading of the Regular Daytime open outcry trading session for the
corresponding Oats futures contract, subject to the provisions of the second
paragraph in Rule 1007.00. On the last day of trading in an expiring option, the
expiring Oats futures options shall be closed with a public call, made strike
price by strike price, conducted by such persons as the Regulatory Compliance
Committee shall direct. Oats futures options shall be opened and closed for all
months and strike prices simultaneously or in such a manner as the Committee
shall direct. (03/01/00)
Ch13 Trading Conditions
-----------------------
1311.01 Position Limits and Reportable Positions - (See Regulation
425.01) (10/01/00)
1312.01 Margin Requirements - (See Regulation 431.05) (09/01/94)
*1313.01 Last Day of Trading - No trades in Oats futures options expiring in the
current month shall be made after the close of trading of the Regular Daytime
open outcry trading session for the corresponding Oats futures contract on the
last Friday which precedes by at least two [five} business days, the last
business day of the month preceding the option month. If such Friday is not a
business day, the last day of trading shall be the business day prior to such
Friday. (03/01/00)
*Additions underlined; Deletions bracketed for contracts from May 2001 forward.
1314.01 Option Premium Fluctuation Limits - Trading is prohibited during any day
except for the last day of trading in an Oats futures option at a premium of
more than the trading limit for the Oats futures contract above and below the
previous day's settlement premium for that option as determined by the Clearing
Corporation. On the first day of trading, limits shall be set from the lowest
premium of the opening range. (09/01/94)
===============================================================================
Chapter 14A
1,000 Ounce Silver Futures
===============================================================================
Ch14A Trading Conditions.............................................
A1401.00 Authority.............................................
A1402.01 Application of Regulations............................
A1404.01 Unit of Trading.......................................
A1405.01 Months Traded In......................................
A1406.01 Price Basis...........................................
A1407.01 Hours of Trading......................................
A1408.01A Trading Limits........................................
A1409.01 Last Day of Trading...................................
A1409.02 Trading in the Last Three Days of the Delivery Month..
A1410.01 Margin Requirements...................................
A1411.01 Disputes..............................................
A1412.01 Position Limits and Reportable Positions..............
Ch14A Delivery Procedures............................................
A1436.01 Standards.............................................
A1440.01 Brands or Markings of Silver Bars.....................
A1440.02 Withdrawal of Approval of Silver Brand or Marking.....
A1440.03 Approved Brands.......................................
A1440.04 Assaying..............................................
A1441.01 Delivery Points.......................................
A1442.01 Deliveries by Vault Receipts..........................
A1442.02 Approved New York Contract Vaults.....................
A1443.01 Issuance of Vault Receipts............................
A1443.02 Deposit of Silver with Vaults.........................
A1444.01 Receipt Format........................................
A1446.01 Date of Delivery......................................
A1447.01 Delivery Notices......................................
A1448.01 Method of Delivery....................................
A1449.00 Time of Delivery, Payment, Form of Delivery Notice....
A1449.02 Buyers' Report of Eligibility to Receive Delivery.....
A1449.03 Sellers' Invoice to Buyers............................
A1449.04 Payment...............................................
A1450.00 Duties of Members.....................................
A1451.01 Office Deliveries Prohibited..........................
A1454.00 Failure to Accept Delivery............................
A1456.01 Storage and Transfer Fees.............................
Ch14A Regularity of Vaults...........................................
A1480.01 Duties of Vault Operators.............................
A1481.01 Conditions of Regularity..............................
A1484.01 Revocation of Regularity..............................
A1485.01 Application for Declaration of Regularity.............
A1486.01 Regular Vaults Chicago................................
===============================================================================
Chapter 14A
1,000 Ounce Silver Futures
===============================================================================
Ch14A Trading Conditions
A1401.00 Authority - On or after August 1,1969 trading in Silver may be
conducted under such terms and conditions as may be prescribed by regulation.
(09/01/94)
A1402.01 Application of Regulations - Transactions in Silver futures shall be
subject to the general rules of the Association as far as applicable to trading
in Silver. (09/01/94)
A1404.01 Unit of Trading - Silver shall be traded in units of 1,000 troy ounces
after the effective date of this regulation. Bids and offers may be accepted in
lots of 1,000 troy ounces or multiples thereof. (09/01/94)
A1405.01 Months Traded In - Trading in Silver may be conducted in the current
month and any subsequent months. (09/01/94)
A1406.01 Price Basis - All prices of Silver shall be basis Chicago, Illinois,
in multiples of 10/100 of one cent per troy ounce. Contracts shall not be made
on any other price basis. (09/01/94)
A1407.01 Hours of Trading - The hours of trading for future delivery in Silver
shall be from 7:25 a.m. to 1:25 p.m. On the last day of trading in an expiring
future the closing time with respect to such future shall be 1:25 p.m. subject
to the otherwise applicable provisions of the second paragraph of Rule 1007.00.
Market shall be opened and closed with a public call made month by month,
conducted by such persons as the Exchange shall direct. (09/01/94)
A1408.01A Trading Limits - (See 1008.01) (09/01/94)
A1409.01 Last Day of Trading - No trades in Silver futures deliverable in the
current month shall be made during the last three business days of that month
and any contracts remaining open must be settled by delivery or as provided in
Regulation 1409.02 after trading in such contracts has ceased; and if not
previously delivered, delivery must be made no later than the last business day
of the month. Tender shall be one business day prior to delivery. (09/01/94)
A1409.02 Trading in the Last Three Days of the Delivery Month - After trading
in contracts for future delivery in the current delivery month has ceased in
accordance with Regulation 1409.01 of this chapter, outstanding contracts for
such delivery may be liquidated by means of a bona fide exchange of such current
futures for the actual cash commodity. Such exchange must, in any event, be made
no later than the last business day of the delivery month. (09/01/94)
A1410.01 Margin Requirements - (See Regulation 431.03) (09/01/94) (See 431.03)
A1411.01 Disputes - All disputes between interested parties may be settled by
arbitration as provided in the Rules and Regulations. 7060 (09/01/94)
A1412.01 Position Limits and Reportable Positions - (See 425.01) (09/01/94)
Ch14A Delivery Procedures
A1436.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be refined Silver in bars cast in basic weights of
1,000 troy ounces (each bar may vary no more than 12% more or less); assaying
not less than 999 fineness and must be a brand and marking officially listed by
the Exchange. 7051 (09/01/94)
A1440.01 Brands or Markings of Silver Bars - Brands or markings may be listed
with the Board of Trade to be deliverable in satisfaction of futures contracts
upon application and approval by the Exchange. The Exchange may require such
sureties as it deems necessary to accompany said applications. The Secretary's
Office shall keep on file descriptions and/or replicas of the brands or markings
of silver bars which are deliverable. The addition of brands or markings shall
be binding upon all such contracts outstanding as well as those entered into
after approval. 7073 (09/01/94)
A1440.02 Withdrawal of Approval of Silver Brand or Marking - If at any time the
metallurgical assay of any silver bars bearing a brand or marking on the
official list depreciates below 999 fineness, the Exchange may exclude said
brand or marking from the official list unless deliveries of bars bearing said
brand or markings are accompanied by certificates of analysis of an official
assayer showing a silver fineness of not less than 999. Notice of such action
shall be posted upon the bulletin board of the Association and the official list
shall indicate the limitation upon deliveries of said brand or marking. 7074
(09/01/94)
A1440.03 Approved Brands - (See Appendix 14A) (09/01/94)
A1440.04 Assaying - The Board of Trade at its sole discretion shall have the
authority at anytime to have assayed any silver bars covered by vault receipts
delivered against futures contracts. Costs to be borne by the Board of Trade.
7072 (09/01/94)
A1441.01 Delivery Points - Silver located at regular vaults at points approved
by the Exchange may be delivered in satisfaction of futures contracts. 7064
(09/01/94)
A1442.01 Deliveries by Vault Receipts - Deliveries on Silver futures contracts
shall be made by the delivery of depository vault receipts issued by vaults
which have been approved and designated as regular vaults by the Exchange for
the storage of Silver. Silver in bars must come to the regular vault directly
from an approved refiner or from another regular vault either on the Chicago or
New York contract by insured or bonded carrier. Vaults may issue receipts for
silver based on receipts for one bar each issued by said vault when the five
receipts originated from silver that was deliverable and registered on the Board
of Trade contract and subsequently broken into small lots and that said silver
bars were never removed from the vault in which it was originally deposited.
The vault receipts shall evidence that storage charges have been paid up to and
including December 31st of the current calendar year. Prepaid storage charges
shall be charged to the buyer by the seller from the date of the delivery to the
expiration of the storage charge period. Penalty charges for late storage
payments shall not be charged to the buyer by the seller. In order to effect a
valid delivery, each vault receipt must be endorsed by the clearing member
making delivery.
By the tender of a warehouse or vault receipt for silver duly endorsed for
delivery of the lot on an Exchange contract, the endorser shall be deemed to
warrant, to his transferee and each subsequent transferee of the receipt for
delivery on Exchange contracts, and their respective immediate principals, the
genuineness, validity, and worth of such receipt, the rightfulness and
effectiveness of his transfer thereof, and the quantity and quality of the
silver shown on the receipt.
In the event such Exchange member or principal shall claim a breach of such
warranty, and such claim relates to the quantity or quality of the silver, the
lot shall be immediately submitted for sampling and assaying to an assayer
approved by the Exchange. The expense of sampling and assaying shall, in the
first instance, be borne by the claimant. If a deficiency in quantity or quality
shall be determined by the assayer, the claimant shall have the right to recover
the difference in the market value and expenses incurred in connection with the
sampling and assaying and any cost of replacement of the silver. The claimant
may, at his option, proceed directly against the original endorser of the
warehouse or vault receipt upon Exchange delivery, or against any endorser prior
to claimant without seeking recovery from his immediate deliverer on the
Exchange contract and if the claim is satisfied by the original
Ch14A Delivery Procedures
-------------------------
endorser of the warehouse or vault receipt, or any other endorser, all the
endorsers will be thereby discharged from liability to the claimant. If the
claimant seeks recovery from any endorser prior to him and his claim is
satisfied by such endorser, the party thus satisfying the claim will have a
similar option to claim recovery directly from any endorser prior to him.
Such claims as are in dispute between members of the Exchange may in each case
be submitted to arbitration under the Rules of the Exchange.
The liability of an endorser of a warehouse or vault receipt as provided herein
shall not be deemed to limit the rights of such endorser against any person or
party for whose account the endorser acted in making delivery on an Exchange
contract. If it shall be determined in such arbitration proceeding that any
endorser of a warehouse or vault receipt or the person or party for whom such
endorser acted was aware of the breach of warranty or was involved in a plan or
arrangement with the original endorser (or his principal) to place such inferior
silver in licensed store for use in deliveries upon Exchange contracts, such
endorsers shall not be entitled to recover from any prior endorser for the
breach of warranty. 7061 (09/01/94)
A1442.02 Approved New York Contract Vaults - (See Appendix 14C) (09/01/94)
A1443.01 Issuance of Vault Receipts - Vault receipts, in order to be eligible
for delivery, must be issued by a regular vault according to the following
procedures and with the following documentation retained by the regular vault:
(1) For all vault receipts:
(a) Receipts shall be issued in numerical order.
(b) Copies shall be kept of any cancelled or voided receipts.
(c) A record shall be kept of the bar number and the corresponding
receipt number.
(2) For silver delivered into the vault directly from a refiner or an approved
source:
(a) Copy of the bar listing which depicts the date of smelting, serial
numbers, brand marking and troy ounces.
(b) Copy of the bonded carrier receipt for the transport of the silver
from the approved source directly into the regular vault.
(3) For silver converted from a receipt issued by another exchange:
(a) A copy of such other exchange's receipt which has been cancelled.
Regular vaults shall also notify the Board of Trade each day that there is a
change in the number of its outstanding vault receipts. (09/01/94)
A1443.02 Deposit of Silver with Vaults - Silver in bars must be ordered into a
regular vault by a clearing member of the Association who shall furnish the
vault with the following information:
1. Authorization to receive silver.
2. Brand or markings.
3. Number of bars.
4. Identification (serial number) of each bar.
5. Weight of each bar.
6. Source (assay report when required-Regulation 1442.01).
7. Clearing member.
8. Carrier.
9. Date of arrival.
Shipments must be prepaid unless otherwise arranged with the regular vault. 7063
(09/01/94)
A1444.01 Receipt Format - The following form of vault receipt shall be used:
Ch14A Delivery Procedures
-------------------------
__________________________________________________________
(Name of Issuer)
__________________________________________________________
Address)
Bearer Receipt No.______________
Chicago, Illinois,___________, 20_____
Bearer Receipt No.______________
Chicago, Illinois,___________, 20_____
RECEIVED from______________________________________________
and stored at the above address in the safety deposit vaults
of the undersigned, as a Bailee, subject to the provisions of
Article 7 of the Illinois Uniform Commercial Code and the
terms and conditions stated hereon, one (1) bar said to
contain the total amount shown herein of Silver 999 fine.
Said bar is deliverable only at said vault to the BEARER of
this receipt upon surrender hereof, and upon payment of
storage charges and other proper charges and expenses
relating to said bars, for which charges and expenses the
undersigned claims a lien.
Payment of handling charges for deposit of said bars and of
storage charges to the end of the current calendar year is
hereby acknowledged. Storage charges for each subsequent
calendar year are to be paid to the undersigned, in advance,
at or before the expiration of the preceding calendar year.
Bar identification markings of the bars covered by this
receipt, as shown hereon, have been recorded by the
undersigned on the basis of markings appearing on said bars.
THE UNDERSIGNED HAS NOT ASCERTAINED, AND IS NOT RESPONSIBLE
FOR, THE AUTHENTICITY OR CORRECTNESS OF MARKINGS ON, OR THE
CONTENT, WEIGHT OR FINENESS OF, SAID BAR.
----------------------------------------------
(Issuer)
By----------------------------
Authorized Signature
BAR IDENTIFICATION MARKINGS
----------------------------------------------------------------------------
WEIGHT
SERIAL NUMBER (Troy Ounces) MARK OR BRAND
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Total___________ ___________
----------------------------------------------------------------------------
STORAGE AND HANDLING CHARGES: Storage charges of___________
per day per contract, minimum___________ per contract; plus
_________ handling charge per contract tor each deposit and
_________ for each withdrawal.
Storage Payments
-------------------------------------------------------------------------------
REC.
DEL.CHG. STORAGE CHARGE
--------------------------------------
RECEIVED FROM DATE AMOUNT AMOUNT PAID TO SIGNATURE
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
ENDORSEMENTS
Date------------------- by-------------------------------------
Date------------------- by-------------------------------------
Date------------------- by-------------------------------------
7078
Ch14A Delivery Procedures
-------------------------
(01/01/00)
A1446.01 Date of Delivery - Where Silver is sold for delivery in a specified
month, delivery of such Silver may be made by the Seller upon such day of the
specified month as the Seller may select. If not previously delivered, delivery
must be made upon the last business day of the month. 7066 (09/01/94)
A1447.01 Delivery Notices - (See 1047.01) (09/01/94)
A1448.01 Method of Delivery - (See 1048.01) (09/01/94)
A1449.00 Time of Delivery, Payment, Form of Delivery Notice - (See 1049.00)
(09/01/94)
A1449.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
A1449.03 Sellers' Invoice to Buyers - In addition to the requirements of
1049.03, the seller shall mail a copy of the invoice to the vault or vaults who
issued the vault receipts being delivered. The seller will thereby notify the
vault of the transfer of ownership of the indicated vault receipts from the
seller to the buyer. The seller will be responsible for the payment of storage
charges unless the vault has been notified thereby. (09/01/94)
A1449.04 Payment - Payment is to be made by a check drawn on and certified by a
Chicago bank or by a Cashier's check issued by a Chicago bank. 7071 (09/01/94)
A1450.00 Duties of Members - (See 1050.00) (09/01/94)
A1451.01 Office Deliveries Prohibited - (See 1051.01) (09/01/94)
A1454.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
A1456.01 Storage and Transfer Fees - Storage charges, transfer fees and
in-and-out charges shall be set by each depository vault and the schedule of
such rates shall be posted with the Association, which should be notified at
least 60 days in advance of any changes in the rate schedule. Except as
otherwise provided, all charges for storage, etc., shall remain the
responsibility of the Seller until payment is made. 7065 (09/01/94)
Ch14A Regularity of Vaults
A1480.01 Duties of Vault Operators - It shall be the duty of the operators of
all regular vaults:
(a) To accept Silver for delivery on Chicago Board of Trade contracts,
provided such Silver is ordered into the Vault by a Clearing Member of the
Association, and all space in such vaults is not already filled or
contracted for.
(b) To notify the Board of Trade of any change in the condition of their
vaults.
(c) To release to the bearer of the receipt the bars covered by said receipt
upon presentation of the receipt and payment of all storage and outloading
charges no later than the business day following compliance with these
provisions.
(d) To keep stocks of Silver in storage in balance with Silver represented by
its outstanding vault receipts. 7076 (09/01/94)
A1481.01 Conditions of Regularity - Persons operating depository vaults who
desire to have such vaults made regular for delivery of silver under the Rules
and Regulations shall make application for a Declaration of Regularity on a form
prescribed by the Exchange for a two year term expiring June 30, 1994, and every
even year thereafter. Regularity shall be effective 30 days after all terms and
conditions have been met and notice to that effect has been posted on the
bulletin board of the Association. Applications for renewal of regularity must
be made prior to May 1, 1994, and every even year thereafter, in each year for
the respective years beginning July 1, 1994, and every even year thereafter and
shall be on the same form. The following shall constitute the requirements and
conditions for regularity:
(1) The vault making application shall be inspected by the Exchange.
(2) The operator of such vault must be a U.S. Bank (either federal or state
charter) or a corporation that acts in a fiduciary capacity with capital
(capital, surplus and undivided earnings) in excess of $250,000,000. The
Exchange may require the operator of the vault to file a bond with
sufficient sureties in such sum and subject to such conditions as the
Exchange sees fit.
(3) Such vault shall be provided with standard equipment and appliances for
the convenient and safe storage of Silver and provide for proper security.
(4) The operator of such vault shall furnish to the Registrar all needed
information to enable him to keep a correct record and account of all
Silver received and delivered by them daily and of that remaining in store
at the close of each week.
(5) The operator of such vault shall accord every facility to any duly
authorized committee for the examination of its books or records for the
purpose of ascertaining the stocks of Silver. The Exchange shall have the
authority to employ experts to determine the quantity and quality of
Silver in said vault.
(6) No vault shall be deemed suitable to be declared regular if its location,
accessibility, tariffs, or other qualifications shall depart from
uniformity to the extent that its receipts as tendered in satisfaction of
futures contracts impair the efficacy of futures trading in this market,
or if the operator of such vault engages in unethical or inequitable
practices, or if the operator fails to comply with any laws, Federal or
State, or Rules or Regulations promulgated under those laws.
(7) The operator shall make such reports, keep such records, and permit such
vault visitation as the Board of Trade may prescribe, and shall comply
with all applicable Rules and Regulations.
(8) Depository vaults must be within the City limits of Chicago.
(9) Vault operator shall maintain, in the immediate vicinity of the Exchange,
either an office, or a duly authorized representative or agent (who must
be a clearing member of the Exchange) approved by the Exchange, where
owners of Vault Receipts may pay charges and surrender receipts for
loading and shipment. 7075 (09/01/94)
A1484.01 Revocation of Regularity - Any regular vault may be declared by the
Business Conduct Committee or, pursuant to Regulation 540.10, the Hearing
Committee, to be irregular at any time if it
Ch14A Regularity of Vaults
--------------------------
does not comply with the conditions above set forth, or fails to carry out its
prescribed duties. If the designation of a vault as regular shall be revoked a
notice shall be posted on the bulletin board announcing such revocation and also
the period of time, if any, during which the receipts issued by such vault shall
thereafter be deliverable in satisfaction of futures contracts in Silver under
the Rules and Regulations. 7077 (09/01/94)
A1485.01 Application for Declaration of Regularity - All applications by
operators of vaults for a Declaration of Regularity under Regulation 1481.01
shall be on the following form:
APPLICATION FOR A DECLARATION OF REGULARITY FOR
THE STORAGE OF SILVER UPON CONTRACTS FOR FUTURE
DELIVERY UNDER THE CHARTER, RULES AND REGULATIONS
OF THE BOARD OF TRADE OF THE CITY OF CHICAGO.
Board of Trade of the City of Chicago
141 West Jackson Boulevard
Chicago, Illinois 60604
Gentlemen:
________________________________________________(hereinafter called
Vault), located at_____________________________, Chicago, Illinois
606_________ and licensed/Incorporated under the laws
of____________________________, having allocated storage capacity
of____________ Troy ounces (hereinafter called Regular Capacity) for
the storage of silver for delivery in satisfaction of futures
contracts on the Board of Trade of the City of Chicago (hereinafter
called Exchange), does hereby make application to the Exchange for a
Declaration of Regularity to handle, receive and store such silver
(hereinafter called Silver) for a period beginning__________________
and ending midnight June 30, 20______.
Conditions of Regularity
Such Declaration of Regularity, if granted, shall be cancellable by
the Exchange whenever the following conditions shall not be observed:
1. The Vault must:
(1) give such bonds to the Exchange as may be reasonably
require.
(2) notify the Exchange promptly of any material change in
ownership or condition of its premises.
(3) make such reports, keep such records, and permit such
inspections as the Exchange may reasonably prescribe.
(4) comply with all applicable Rules and Regulations of
the Exchange; and comply with all requirements of the
Exchange permitted or required by such Rules and
Regulations.
2. The Vault must be:
(1) continuously located within the City limits of Chicago.
(2) properly safeguarded and equipped to provide safe and
convenient storage of Silver.
Agreements of Vault
The Vault expressly agrees:
(1) in the event of revocation or expiration of regularity, to bear
the expenses of the transfer of Silver to another regular vault
satisfactory to the holders of its vault receipts.
(2) neither to withdraw as a regular vault nor withdraw any Regular
Capacity during the life of this Declaration of Regularity except
after sixty (60) days notice to the Exchange or having obtained
the consent of the Exchange.
(3) to notify the Exchange at least sixty (60) days in advance of any
changes in its maximum storage, penalty for late storage payment
and handling charges as shown in the attached schedule.
Submitted herewith is a specimen of the Vault's proposed vault
receipt.
____________________________
________________________ By__________________________
Date Title
This application is approved and a Declaration of Regularity is
hereby granted.
Board of Trade of the City of Chicago
By__________________________
________________________
Date
By__________________________
Ch14A Regularity of Vaults
--------------------------
Secretary
7079
(01/01/00)
A1486.01 Regular Vaults Chicago - (See Appendix 14B) (09/01/94)
[Enlarge/Download Table]
================================================================================================================
Chapter 14B
5,000 Ounce Silver Futures
================================================================================================================
Ch14B Trading Conditions........................................................................
B1401.00 Authority...................................................................
B1402.01 Application of Regulations..................................................
B1404.01 Unit of Trading.............................................................
B1405.01 Months Traded In............................................................
B1406.01 Price Basis.................................................................
B1407.01 Hours of Trading............................................................
B1408.01A Trading Limits..............................................................
B1409.01 Last Day of Trading.........................................................
B1409.02 Trading in the Last Three Days of the Delivery Month........................
B1410.01 Margin Requirements.........................................................
B1411.01 Disputes....................................................................
B1412.01 Position Limits and Reportable Positions....................................
Ch14B Delivery Procedures.......................................................................
B1436.01 Standards...................................................................
B1440.01 Brands or Markings of Silver Bars...........................................
B1440.02 Withdrawal of Approval of Silver Brand or Marking...........................
B1440.03 Approved Brands.............................................................
B1440.04 Assaying....................................................................
B1441.01 Delivery Points.............................................................
B1442.01 Deliveries by Vault Receipts................................................
B1442.02 Approved New York Contract Vaults...........................................
B1443.01 Issuance of Vault Receipts..................................................
B1443.02 Deposit of Silver with Vaults...............................................
B1444.01 Receipt Format..............................................................
B1446.01 Date of Delivery............................................................
B1447.01 Delivery Notices............................................................
B1448.01 Method of Delivery..........................................................
B1449.00 Time of Delivery, Payment, Form of Delivery Notice..........................
B1449.02 Buyers' Report of Eligibility to Receive Delivery...........................
B1449.03 Sellers' Invoice to Buyers..................................................
B1449.04 Payment.....................................................................
B1450.00 Duties of Members...........................................................
B1451.01 Office Deliveries Prohibited................................................
B1454.00 Failure to Accept Delivery..................................................
B1456.01 Storage and Transfer Fees...................................................
Ch14B Regularity of Vaults......................................................................
B1480.01 Duties of Vault Operators...................................................
B1481.01 Conditions of Regularity....................................................
B1484.01 Revocation of Regularity....................................................
B1485.01 Application for Declaration of Regularity...................................
B1486.01 Regular Vaults..............................................................
================================================================================
Chapter 14B
5,000 Ounce Silver Futures
================================================================================
Ch14B Trading Conditions
B1401.00 Authority - On or after August 1, 1969, trading in Silver may be
conducted under such terms and conditions as may be prescribed by regulation.
(09/01/94)
B1402.01 Application of Regulations - Transactions in Silver futures shall be
subject to the general rules of the Association as far as applicable to trading
in Silver.
For the purposes of this chapter, the trading day begins with the commencement
of trading in each evening session and ends with the close of trading in the
next afternoon session. (09/01/94)
B1404.01 Unit of Trading - Silver shall be traded in units of 5,000 troy ounces
after the effective date of this regulation. Bids and offers may be accepted in
lots of 5,000 troy ounces or multiples thereof. (09/01/94)
B1405.01 Months Traded In - Trading in Silver may be conducted in the current
month and any subsequent months. (09/01/94)
B1406.01 Price Basis - All prices of Silver shall be basis Chicago, Illinois or
New York, New York, in multiples of 10/100 of one cent per troy ounce. Contracts
shall not be made on any other price basis. (09/01/94)
B1407.01 Hours of Trading - The evening hours of trading for future delivery in
Silver shall be determined by the Board. The daytime hours of trading for future
delivery in Silver shall be from 7:25 a.m. to 1:25 p.m. On the last day of
trading in an expiring future the closing time with respect to such future shall
be 1:25 p.m. subject to the otherwise applicable provisions of the second
paragraph of Rule 1007.00. Market shall be opened and closed with a public call
made month by month, conducted by such persons as the Exchange shall direct.
(09/01/94)
B1408.01A Trading Limits - (See 1008.01) (09/01/94)
B1409.01 Last Day of Trading - No trades in Silver futures deliverable in the
current month shall be made during the last three business days of that month
and any contracts remaining open must be settled by delivery or as provided in
Regulation 1409.02 after trading in such contracts has ceased; and if not
previously delivered, delivery must be made no later than the last business day
of the month. Tender shall be one business day prior to delivery. (09/01/94)
B1409.02 Trading in the Last Three Days of the Delivery Month - After trading
in contracts for future delivery in the current delivery month has ceased in
accordance with Regulation 1409.01 of this chapter, outstanding contracts for
such delivery may be liquidated by means of a bona fide exchange of such current
futures for the actual cash commodity. Such exchange must, in any event, be made
no later than the last business day of the delivery month. (09/01/94)
B1410.01 Margin Requirements - (See Regulation 431.03) (09/01/94)
B1411.01 Disputes - All disputes between interested parties may be settled by
arbitration as provided in the Rules and Regulations. (09/01/94)
B1412.01 Position Limits and Reportable Positions - (See 425.01) (09/01/94)
Ch14B Delivery Procedures
B1436.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be refined Silver in bars cast in basic weights of
1,000 or 1,100 troy ounces (each bar may vary no more than 10% more or less);
assaying not less than 999 fineness and made up of one or more brands and
markings officially listed by the Exchange. Delivery against contracts shall be
in units of 5,000 troy ounces (6% more or less) comprised of 4 or 5 individual
bars. (09/01/94)
B1440.01 Brands or Markings of Silver Bars - Brands or markings may be listed
with the Board of Trade to be deliverable in satisfaction of futures contracts
upon application and approval by the Exchange. The Exchange may require such
sureties as it deems necessary to accompany said applications. The Secretary's
Office shall keep on file descriptions and/or replicas of the brands or markings
of silver bars which are deliverable. The addition of brands or markings shall
be binding upon all such contracts outstanding as well as those entered into
after approval. (09/01/94)
B1440.02 Withdrawal of Approval of Silver Brand or Marking - If at any time the
metallurgical assay of any silver bars bearing a brand or marking on the
official list depreciates below 999 fineness, the Exchange may exclude said
brand or marking from the official list unless deliveries of bars bearing said
brand or markings are accompanied by certificates of analysis of an official
assayer showing a silver fineness of not less than 999. Notice of such action
shall be posted upon the bulletin board of the Association and the official list
shall indicate the limitation upon deliveries of said brand or marking.
(09/01/94)
B1440.03 Approved Brands - (See Appendix 14A) (09/01/94)
B1440.04 Assaying - The Board of Trade at its sole discretion shall have the
authority at anytime to have assayed any silver bars covered by vault receipts
delivered against futures contracts. Costs to be borne by the Board of Trade.
(09/01/94)
B1441.01 Delivery Points - Silver located at regular vaults at points approved
by the Exchange may be delivered in satisfaction of futures contracts.
(09/01/94)
B1442.01 Deliveries by Vault Receipts - Deliveries on Silver futures contracts
shall be made by the delivery of depository vault receipts issued by vaults
which have been approved and designated as regular vaults by the Exchange for
the storage of Silver. Silver in bars must come to the regular vault directly
from an approved refiner or from another regular vault for delivery either on
the Chicago or New York contract by insured or bonded carrier. Vaults may issue
receipts for silver based on receipts for one bar each issued by said vault when
the four or five receipts originated from silver that was deliverable and
registered on the Board of Trade contract and subsequently broken into small
lots and that said silver bars were never removed from the vault in which it was
originally deposited.
The vault receipts issued by Chicago vaults shall evidence that storage charges
have been paid up to and including December 31 of the current calendar year. A
clearing member delivering a New York vault receipt must also tender an
attachment that storage charges have been paid up to and including the calendar
year. Prepaid storage charges shall be charged to the buyer by the seller from
the date of the delivery to the expiration of the storage charge period. Penalty
charges for late storage payments shall not be charged to the buyer by the
seller. In order to effect a valid delivery, each vault receipt must be endorsed
by the clearing member making delivery.
By the tender of a warehouse or vault receipt for silver duly endorsed for
delivery of the lot on an Exchange contract, the endorser shall be deemed to
warrant, to his transferee and each subsequent transferee of the receipt for
delivery on Exchange contracts, and their respective immediate principals, the
genuineness, validity, and worth of such receipt, the rightfulness and
effectiveness of his transfer thereof, and the quantity and quality of the
silver shown on the receipt.
In the event such Exchange member or principal shall claim a breach of such
warranty, and such claim relates to the quantity or quality of the silver, the
lot shall be immediately submitted for sampling and assaying to an assayer
approved by the Exchange. The expense of sampling and assaying shall, in the
first instance, be borne by the claimant. If a deficiency in quantity or quality
shall be determined by the assayer, the claimant shall have the right to recover
the difference in the market value and expenses incurred in connection with the
sampling and assaying and any cost of replacement of the silver. The
Ch14B Delivery Procedures
-------------------------
claimant may, at his option, proceed directly against the original endorser of
the warehouse or vault receipt upon Exchange delivery, or against any endorser
prior to claimant without seeking recovery from his immediate deliverer on the
Exchange contract and if the claim is satisfied by the original endorser of the
warehouse or vault receipt, or any other endorser, all the endorsers will be
thereby discharged from liability to the claimant. If the claimant seeks
recovery from any endorser prior to him and his claim is satisfied by such
endorser, the party thus satisfying the claim will have a similar option to
claim recovery directly from any endorser prior to him.
Such claims as are in dispute between members of the Exchange may in each case
be submitted to arbitration under the Rules of the Exchange.
The liability of an endorser of a warehouse or vault receipt as provided herein
shall not be deemed to limit the rights of such endorser against any person or
party for whose account the endorser acted in making delivery on an Exchange
contract. If it shall be determined in such arbitration proceeding that any
endorser of a warehouse or vault receipt or the person or party for whom such
endorser acted was aware of the breach of warranty or was involved in a plan or
arrangement with the original endorser (or his principal) to place such inferior
silver in licensed store for use in deliveries upon Exchange contracts, such
endorsers shall not be entitled to recover from any prior endorser for the
breach of warranty. (09/01/94)
B1442.02 Approved New York Contract Vaults - (See Appendix 14C) (09/01/94)
B1443.01 Issuance of Vault Receipts - Vault receipts, in order to be eligible
for delivery, must be issued by a regular vault according to the following
procedures and with the following documentation retained by the regular vault:
(1) For all vault receipts:
(a) Receipts shall be issued in numerical order.
(b) Copies shall be kept of any cancelled or voided receipts.
(c) A record shall be kept of the bar number and the corresponding receipt
number.
(2) For silver delivered into the vault directly from a refiner or an approved
source:
(a) Copy of the bar listing which depicts the date of smelting,
serial numbers, brand marking and troy ounces.
(b) Copy of the bonded carrier receipt for the transport of the
silver from the approved source directly into the regular vault.
(3) For silver converted from a receipt issued by another exchange:
(a) A copy of such other exchange's receipt which has been cancelled.
Regular vaults shall also notify the Board of Trade each day that there is a
change in the number of its outstanding vault receipts. (09/01/94)
B1443.02 Deposit of Silver with Vaults - Silver in bars must be ordered into a
regular vault by a clearing member of the Association who shall furnish the
vault with the following information:
1. Authorization to receive silver.
2. Brand or markings.
3. Number of bars.
4. Identification (serial number) of each bar.
5. Weight of each bar.
6. Source (assay report when required-Regulation 1442.01).
7. Clearing member.
8. Carrier.
9. Date of arrival.
Ch14B Delivery Procedures
-------------------------
Shipments must be prepaid unless otherwise arranged with the regular vault.
(09/01/94)
B1444.01 Receipt Format - The following form of vault receipt shall be used:
________________________________________________________________________
(Name of Issuer)
________________________________________________________________________
(Address)
Bearer Receipt No.______________
Chicago, Illinois,_________________, 20________
RECEIVED from___________________________________________________________
and stored at the above address in the safety deposit vaults of the
undersigned, as a Bailee, subject to the provisions of Article 7 of the
Illinois Uniform Commercial Code and the terms and conditions stated
hereon, four (4) or five (5) bars said to contain the total amount shown
hereon of Silver 999 fine.
Said bars are deliverable only at said vault to the BEARER of this
receipt upon surrender hereof, and upon payment of storage charges and
other proper charges and expenses relating to said bars, for which
charges and expenses the undersigned claims a lien.
Payment of handling charges for deposit of said bars and of storage
charges to the end of the current calendar year is hereby acknowledged.
Storage charges for each subsequent calendar year are to be paid to the
undersigned, in advance, at or before the expiration of the preceding
calendar year.
Bar identification markings of the bars covered by this receipt, as
shown hereon, have been recorded by the undersigned on the basis of
markings appearing on said bars. THE UNDERSIGNED HAS NOT ASCERTAINED,
AND IS NOT RESPONSIBLE FOR, THE AUTHENTICITY OR CORRECTNESS OF MARKINGS
ON, OR THE CONTENT, WEIGHT OR FINENESS OF, SAID BAR.
______________________________________________________________
(Issuer)
By___________________________________
Authorized Signature
BAR IDENTIFICATION MARKINGS
------------------------------------------------------------------------------
WEIGHT
SERIAL NUMBER (Troy Ounces) MARK OR BRAND
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Total___________ ___________
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STORAGE AND HANDLING CHARGES: Storage charges of________________
per day per contract, minimum________________ per contract; plus
_______________handling charge per contract tor each deposit and
_______________for each withdrawal.
Storage Payments
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REC. DEL.CHG. STORAGE CHARGE
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RECEIVED FROM DATE AMOUNT AMOUNT PAID TO SIGNATURE
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ENDORSEMENTS
Date_______________________ by_______________________________________
Date_______________________ by_______________________________________
Date_______________________ by_______________________________________
(01/01/00)
Ch14B Delivery Procedures
-------------------------
B1446.01 Date of Delivery - Where Silver is sold for delivery in a specified
month, delivery of such Silver may be made by the Seller upon such day of the
specified month as the Seller may select. If not previously delivered, delivery
must be made upon the last business day of the month. (09/01/94)
B1447.01 Delivery Notices - (See 1047.01) (09/01/94)
B1448.01 Method of Delivery - (See 1048.01) (09/01/94)
B1449.00 Time of Delivery, Payment, Form of Delivery Notice - (See 1049.00)
(09/01/94)
B1449.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
B1449.03 Sellers' Invoice to Buyers - In addition to the requirements of
1049.03, the seller shall mail a copy of the invoice to the vault or vaults who
issued the vault receipts being delivered. The seller will thereby notify the
vault of the transfer of ownership of the indicated vault receipts from the
seller to the buyer. The seller will be responsible for the payment of storage
charges unless the vault has been notified thereby. (09/01/94)
B1449.04 Payment - Payment is to be made by a check drawn on and certified by a
Chicago bank or by a Cashier's check issued by a Chicago bank. (09/01/94)
B1450.00 Duties of Members - (See 1050.00) (09/01/94)
B1451.01 Office Deliveries Prohibited - (See 1051.01) (09/01/94)
B1454.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
B1456.01 Storage and Transfer Fees - Storage charges, transfer fees and
in-and-out charges shall be set by each depository vault and the schedule of
such rates shall be posted with the Association, which should be notified at
least 60 days in advance of any changes in the rate schedule. Except as
otherwise provided, all charges for storage, etc., shall remain the
responsibility of the Seller until payment is made. (09/01/94)
Ch14B Regularity of Vaults
B1480.01 Duties of Vault Operators - It shall be the duty of the operators of
all regular vaults:
(a) To accept Silver for delivery on Chicago Board of Trade contracts, provided
such Silver is ordered into the Vault by a Clearing Member of the
Association, and all space in such vaults is not already filled or
contracted for.
(b) To notify the Board of Trade of any change in the condition of their
vaults.
(c) To release to the bearer of the receipt the bars covered by said receipt
upon presentation of the receipt and payment of all storage and outloading
charges no later than the business day following compliance with these
provisions.
(d) To keep stocks of Silver in storage in balance with Silver represented by
its outstanding vault receipts. (09/01/94)
B1481.01 Conditions of Regularity - Persons operating depository vaults who
desire to have such vaults made regular for delivery of silver under the Rules
and Regulations shall make application for a Declaration of Regularity on a form
prescribed by the Exchange for a two year term expiring June 30, 1994, and every
even year thereafter. Regularity shall be effective 30 days after all terms and
conditions have been met and notice to that effect has been posted on the
bulletin board of the Association. Applications for renewal of regularity must
be made prior to May 1, 1994, and every even year thereafter, for the respective
years beginning July 1, 1994, and every even year thereafter and shall be on the
same form. The following shall constitute the requirements and conditions for
regularity:
(1) The vault making application shall be inspected by the Exchange.
(2) The operator of such vault must be a U.S. Bank (either federal or state
charter) or a corporation that acts in a fiduciary capacity with capital
(capital, surplus and undivided earnings) in excess of $250,000,000. The
Exchange may require the operator of the vault to file a bond with
sufficient sureties in such sum and subject to such conditions as the
Exchange sees fit.
(3) Such vault shall be provided with standard equipment and appliances for the
convenient and safe storage of Silver and provide for proper security.
(4) The operator of such vault shall furnish to the Registrar all needed
information to enable him to keep a correct record and account of all
Silver received and delivered by them daily and of that remaining in store
at the close of each week.
(5) The operator of such vault shall accord every facility to any duly
authorized committee for the examination of its books or records for the
purpose of ascertaining the stocks of Silver. The Exchange shall have the
authority to employ experts to determine the quantity and quality of Silver
in said vault.
(6) No vault shall be deemed suitable to be declared regular if its location,
accessibility, tariffs, or other qualifications shall depart from
uniformity to the extent that its receipts as tendered in satisfaction of
futures contracts impair the efficacy of futures trading in this market, or
if the operator of such vault engages in unethical or inequitable
practices, or if the operator fails to comply with any laws, Federal or
State, or Rules or Regulations promulgated under those laws.
(7) The operator shall make such reports, keep such records, and permit such
vault visitations as the Board of Trade may prescribe, and shall comply
with all applicable Rules and Regulations.
(8) Depository vaults must be within the City limits of Chicago, Illinois or in
New York, New York. (09/01/94)
B1484.01 Revocation of Regularity - Any regular vault may be declared by the
Business Conduct Committee or, pursuant to Regulation 540.10, the Hearing
Committee, to be irregular at any time if it does not comply with the conditions
above set forth, or fails to carry out its prescribed duties. If the designation
of a vault as regular shall be revoked, notice of such revocation shall be
posted on the Association bulletin board and also the period of time, if any,
during which the receipts issued by such vault shall thereafter be deliverable
in satisfaction of futures contracts in Silver under the Rules and Regulations.
(09/01/94)
Ch14B Regularity of Vaults
--------------------------
B1485.01 Application for Declaration of Regularity - All applications by
operators of vaults for a Declaration of Regularity under Regulation 1481.01
shall be on the following form:
APPLICATION FOR A DECLARATION OF REGULARITY FOR
THE STORAGE OF SILVER UPON CONTRACTS FOR FUTURE
DELIVERY UNDER THE CHARTER, RULES AND REGULATIONS
OF THE BOARD OF TRADE OF THE CITY OF CHICAGO.
Board of Trade of the City of Chicago
141 West Jackson Boulevard
Chicago, Illinois 60604
Gentlemen:
________________________________________________(hereinafter called Vault),
located at_____________________________, Chicago, Illinois 606_________ and
licensed/Incorporated under the laws of____________________________, having
allocated storage capacity of____________ Troy ounces (hereinafter called
Regular Capacity) for the storage of silver for delivery in satisfaction of
futures contracts on the Board of Trade of the City of Chicago (hereinafter
called Exchange), does hereby make application to the Exchange for a
Declaration of Regularity to handle, receive and store such silver
(hereinafter called Silver) for a period beginning__________________ and
ending midnight June 30, 20______.
Conditions of Regularity
Such Declaration of Regularity, if granted, shall be cancellable by the
Exchange whenever the following conditions shall not be observed:
1. The Vault must:
(1) give such bonds to the Exchange as it may reasonably require.
(2) notify the Exchange promptly of any material change in ownership
or condition of its premises.
(3) make such reports, keep such records, and permit such inspections
as the Exchange may reasonably prescribe.
(4) comply with all applicable Rules and Regulations of the Exchange;
and comply with all requirements of the Exchange permitted or
required by such Rules and Regulations.
2. The Vault must be:
(1) continuously located within the City limits of Chicago, Illinois
or within the city limits of New York, New York.
(2) properly safeguarded and equipped to provide safe and convenient
storage of Silver.
Agreements of Vault
The Vault expressly agrees:
(1) in the event of revocation or expiration of regularity, to bear the
expenses of the transfer of Silver to another regular vault
satisfactory to the holders of its vault receipts.
(2) neither to withdraw as a regular vault nor withdraw any Regular
Capacity during the life of this Declaration of Regularity except
after sixty (60) days notice to the Exchange or having obtained the
consent of the Exchange.
(3) to notify the Exchange at least sixty (60) days in advance of any
changes in its maximum storage, penalty for late storage payment and
handling charges as shown in the attached schedule.
Submitted herewith is a specimen of the Vault's proposed vault receipt.
___________________________________
________________________________ By_________________________________
Date Title
This application is approved and a Declaration of Regularity is hereby
granted.
Board of Trade of the City of Chicago
________________________________
Date
By_________________________________
Secretary
(01/01/00) 7079
B1486.01 Regular Vaults - (See Appendix 14B) (09/01/94)
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Chapter 15A
One Kilo Gold Futures
===============================================================================================================
Ch15A Trading Conditions.......................................................................
A1501.00 Authority..................................................................
A1502.01 Application of Regulations.................................................
A1504.01 Unit of Trading............................................................
A1505.01 Months Traded In...........................................................
A1506.01 Price Basis................................................................
A1507.01 Hours in Trading...........................................................
A1508.01A Trading Limits.............................................................
A1509.01 Last Day of Trading........................................................
A1509.02 Trading in the Last Three Days of the Delivery Month.......................
A1510.01 Margin Requirements........................................................
A1511.01 Disputes...................................................................
A1512.01 Position Limits and Reportable Positions...................................
Ch15A Delivery Procedures......................................................................
A1536.01 Standards..................................................................
A1540.01 Brands and Markings of Gold................................................
A1540.02 Withdrawal of Approval of Gold Brands and Markings.........................
A1540.03 Approved Brands............................................................
A1540.04 Assaying...................................................................
A1541.01 Delivery Points............................................................
A1542.01 Deliveries by Vault Receipts...............................................
A1543.01 Issuance of Vault Receipts.................................................
A1543.02 Deposit of Gold with Vaults................................................
A1544.01 Receipt Format.............................................................
A1546.01 Date of Delivery...........................................................
A1547.01 Delivery Notices...........................................................
A1548.01 Method of Delivery.........................................................
A1549.00 Time of Delivery, Payment, Form of Delivery Notice.........................
A1549.02 Buyers' Report of Eligibility to Receive Delivery..........................
A1549.03 Sellers' Invoice to Buyers.................................................
A1549.04 Payment....................................................................
A1550.00 Duties of Members..........................................................
A1551.01 Office Deliveries Prohibited...............................................
A1554.00 Failure to Accept Delivery.................................................
A1556.01 Storage and Transfer Fees..................................................
Ch15A Regularity of Vaults.....................................................................
A1580.01 Duties of Vault Operators..................................................
A1581.01 Conditions of Regularity...................................................
A1584.01 Revocation of Regularity...................................................
A1585.01 Application for Declaration of Regularity..................................
A1586.01 Regular Vault..............................................................
================================================================================
Chapter 15A
One Kilo Gold Futures
================================================================================
Ch15A Trading Conditions
A1501.00 Authority - Whenever it shall be permitted by the U.S. Government
trading in Gold may be conducted under such terms and conditions as may be
prescribed by regulation. (09/01/94)
A1502.01 Application of Regulations - Transactions in Gold futures shall
be subject to the general rules of the Association as far as applicable to
trading in Gold. (09/01/94)
A1504.01 Unit of Trading - The unit of trading shall be 1 (one) gross
kilogram of gold. Bids and offers may be accepted in lots of 1 (one) gross
kilogram or multiples thereof. (09/01/94)
A1505.01 Months Traded In - Trading in Gold may be conducted in the
current month and any subsequent months. (09/01/94)
A1506.01 Price Basis - All prices of gold shall be basis in store in
approved vaults in Chicago, Illinois or New York, New York, in multiples of ten
cents per fine troy ounce. Contracts shall not be made on any other price basis.
(09/01/94)
A1507.01 Hours in Trading - The hours of trading for future delivery in
Gold shall be from 7:20 a.m. to 1:40 p.m. On the last day of trading in an
expiring future, the closing time with respect to such future shall be 1:40 p.m.
subject to the otherwise applicable provisions of the second paragraph of Rule
1007.00. (09/01/94)
A1508.01A Trading Limits - (See 1008.01) (09/01/94)
A1509.01 Last Day of Trading - No trades in Gold futures deliverable in
the current month shall be made during the last three business days of that
month and any contracts remaining open must be settled by delivery or as
provided in Regulation 1509.02 after trading in such contracts has ceased; and
if not previously delivered, delivery must be made no later than the last
business day of the month. Tender shall be one business day prior to delivery.
As is the case with other contracts, delivery notices and supporting data
processing (Delivery) cards must be made delivered to the Clearing House by 4:00
p.m. on position day except that, on the last notice day of the delivery month,
delivery notices and supporting data processing cards may be delivered to the
Clearing House until 2:00 p.m. on intention day. (09/01/94)
A1509.02 Trading in the Last Three Days of the Delivery Month - After
trading contracts for future delivery in the current delivery month has ceased
in accordance with Regulation 1509.01 of this chapter, outstanding contracts for
such delivery may be liquidated by means of bona fide exchange of such current
futures for the actual cash commodity. Such exchange must, in any event, be made
no later than the last business day of the delivery month. (09/01/94)
A1510.01 Margin Requirements - (See Regulation 431.03) (09/01/94)
A1511.01 Disputes - All disputes between interested parties may be settled
by arbitration as provided in the Rules and Regulations. (09/01/94)
A1512.01 Position Limits and Reportable Positions - (See 425.01)
(09/01/94)
Ch15A Delivery Procedures
A1536.01 Standards - The contract grade for delivery on futures contracts
made under these Regulations shall be 1 (one) bar of refined gold cast in a
gross weight of 1 kilogram minimum, (for the purpose of this contract a kilogram
is a weight equal to 32.150 troy ounces), assaying not less than 995 fineness
and bearing brands and markings officially approved by the Exchange.
Settlement shall be the basis of the fine troy ounces of gold delivered.
(09/01/94)
A1540.01 Brands and Markings of Gold - Brands and markings deliverable in
satisfaction of futures contracts shall be listed with the Board of Trade upon
approval by the Exchange. The Exchange may require such sureties as it deems
necessary. The Secretary's Office shall keep on file the brands and markings of
gold bars which are deliverable. The addition of brands and markings shall be
binding upon all contracts outstanding as well as those entered into after
approval. (09/01/94)
A1540.02 Withdrawal of Approval of Gold Brands and Markings - If at
anytime a brand and marking fails to meet the requirements adopted by the
Exchange or the metallurgical assay of any gold bars bearing a brand and marking
on the official list depreciates below 995 fineness, the Exchange may exclude
said brand and marking from the official list unless deliveries of bars bearing
said brand and marking are accompanied by certificates of analysis of an
official assayer showing a gold fineness of not less than 995, and such
additional bond as the Exchange may deem necessary. Notice of such action shall
be given promptly in writing to each regular vault and shall be posted upon the
bulletin board of the Association and the official list shall indicate the
limitation upon deliveries of said brand and marking. (09/01/94)
A1540.03 Approved Brands - (See Appendix 15A) (09/01/94)
A1540.04 Assaying - The Board of Trade at its sole discretion shall have
the authority at any time to have assayed any Gold bars covered by vault
receipts delivered against futures contracts. Cost to be borne by the Board of
Trade. (09/01/94)
A1541.01 Delivery Points - Gold located at regular vaults at points
approved by the Exchange (Regulation 1581.01) may be delivered in satisfaction
of futures contracts. (09/01/94)
A1542.01 Deliveries by Vault Receipts - Deliveries on Gold futures
contracts shall be made by the delivery of depository vault receipts issued by
vaults which have been approved and designated by the Board as regular vaults
for the storage of Gold. Gold bars must be good delivery bars as defined by
Board regulations and shipped under bond directly to the regular vault from an
approved vault; or must be bars purchased from an approved source and shipped
directly from that source under bond to the regular vault. Gold bars entering a
regular vault for delivery must be weighed at the vault by a weigher approved by
the Association.
The gross weight of the bars shall be recorded by the approved weigher on the
vault receipt (Regulation 1544.01) to the nearest one thousand (0.001) of a troy
ounce.
The vault receipt issued by Chicago vaults shall evidence that storage charges
have been paid up to and including the end of the Calendar quarter. A clearing
member delivering a New York vault receipt must also tender an attachment
stating that storage charges have been paid up to and including the end of the
calendar quarter. Prepaid Storage Charges shall be charged to the buyer by the
seller from the date of delivery to the expiration of the storage charge period.
In order to effect a valid delivery, each vault receipt must be endorsed by the
clearing member making delivery. If the owner removes gold from a vault, any
prepaid storage charges shall be refunded by the vault to the owner from the
date of removal of the gold to the expiration of the storage charge period. By
the tender of a vault receipt for Gold duly endorsed by delivery on an Exchange
contract, the endorser shall be deemed to warrant, to his transferee and each
subsequent transferee of the receipt for delivery on Exchange contracts, and
their respective immediate principals, the genuineness and worth of such
receipt, the rightfulness and effectiveness of the transfer thereof, and the
quantity and quality of the Gold shown on the receipt.
In the event that such Exchange member or principal shall claim a breach of such
warranty, and such claim relates to the quantity or quality of the Gold, the lot
shall be immediately submitted for sampling and assaying to any assayer approved
by the Exchange; the gold must be shipped under bond, and at
Ch15A Delivery Procedures
-------------------------
the owner's expense, to the assayer. The expense of sampling and assaying shall
in the first instance, be borne by the claimant. If a deficiency in quantity or
quality shall be determined by the assayer, the claimant shall have the right to
recover the difference in the market value and expenses incurred in connection
with the sampling and assaying and any cost of replacement of Gold. The claimant
may, at his option, proceed directly against the original endorser of the
warehouse or vault receipt upon Exchange delivery, or against any endorser prior
to claimant without seeking recovery from his immediate deliverer on the
Exchange contract and if the claim is satisfied by the original endorser of the
warehouse or vault receipt, or any other endorser, all the endorsers will be
thereby discharged from liability to the claimant. If the claimant seeks
recovery from any endorser and his claim is satisfied by such endorser, the
party thus satisfying the claim will have a similar option to claim recovery
directly from any endorser prior to him. Such claims as are in dispute between
members of the Exchange may in each case be submitted to arbitration under the
Rules of the Exchange. The liability of an endorser of a vault receipt as
provided herein shall not be deemed to limit the rights of such endorser against
any person or party for whose account the endorser acted in making delivery on
an Exchange contract. If it shall be determined in such arbitration proceeding
that any endorser of a vault receipt or the person or party for whom such
endorser acted was aware of the breach of warranty or was involved in a plan or
agreement with the original endorser (or his principal) to place such inferior
Gold in licensed store for use in deliveries upon Exchange contracts, such
endorsers shall not be entitled to recover from any prior endorser for the
breach of warranty. (09/01/94)
A1543.01 Issuance of Vault Receipts - Vault receipts, in order to be
eligible for delivery, must be issued by a regular vault according to the
following procedures and with the following documentation retained by the
regular vault:
(1) For all vault receipts:
(a) Receipts shall be issued in numerical order.
(b) Copies shall be kept of any cancelled or voided receipts.
(c) A record shall be kept of the bar number and the corresponding
receipt number.
(2) For gold delivered into the vault directly from a refiner or an approved
source:
(a) Copy of the bar listing which depicts the date of smelting,
serial numbers, brand marking and troy ounces.
(b) Copy of the bonded carrier receipt for the transport of the gold
from the refiner or the approved source directly into the regular
vault.
(3) For gold converted from a receipt issued by another exchange:
(a) A copy of such other exchange's receipt which has been cancelled.
Regular vaults shall also notify the Board of Trade each day that there is a
change in the number of its outstanding vault receipts. (09/01/94)
A1543.02 Deposit of Gold with Vaults - Gold in bars must be ordered into a
regular vault by a clearing member of the Association who shall furnish the
vault with the following written notice:
1. Request to receive gold.
2. Brands and markings.
3. Number of bars.
4. Identification (serial number) of each bar.
5. Weight of each bar.
6. Source.
7. Clearing member.
8. Carrier.
9. Date of arrival.
Ch15A Delivery Procedures
-------------------------
Shipment must be prepaid unless otherwise arranged with the regular vault.
(09/01/94)
A1544.01 Receipt Format - The following form of vault receipt shall be used:
__________________________________________________________________
(Name of Issuer)
__________________________________________________________________
(Address)
Bearer Receipt No.________________________________________________
Chicago, Illinois________________, 20____
RECEIVED from_____________________________________________________
and stored at the above address in the safety deposit vaults of the
undersigned, as a Bailee, subject to the provisions of Article 7 of
the____________________________ Uniform Commercial Code and the terms
and conditions stated hereon, a gold bar SAID TO CONTAIN the amount
shown hereon of Gold of the fineness indicated.
Said bar is deliverable only at said vaults to the BEARER of this
receipt upon surrender hereof and upon payment of storage charges and
other proper charges and expenses relating to said bar, for which
charges and expenses the undersigned claims a lien.
Payment of handling charges for deposit of said bar and of storage
charges to the end of the current calendar quarter is hereby
acknowledged. Storage charges for each subsequent calendar quarter are
to be paid to the undersigned, in advance, at or before the expiration
of the preceding calendar quarter.
Bar identification markings of bar covered by this receipt, as shown
hereon, have been recorded by the undersigned on the basis of markings
appearing on said bar. THE UNDERSIGNED HAS NOT ASCERTAINED, AND IS NOT
RESPONSIBLE FOR, THE AUTHENTICITY OR CORRECTNESS OF MARKINGS ON, OR
THE CONTENT, WEIGHT OR FINENESS OF, SAID BAR.
______________________________________________________________________
(Issuer)
By_________________________________
(Authorized Signature)
Gross Weight as determined by a weigher approved by the Board of
Trade of the City of Chicago________________troy ounces.
___________________________________
Approved weigher of the Board of
Trade of the City of Chicago
BAR IDENTIFICATION MARKINGS
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------------------------ -------------------------------------------- ---------------------- ----------------------
Gross Weigh
--------------------------------------------
Serial Number Troy Ounces Kilograms Mark or Brand Fineness
------------------------ ---------------------- --------------------- ---------------------- ----------------------
------------------------ ---------------------- --------------------- ---------------------- ----------------------
------------------------ ---------------------- --------------------- ---------------------- ----------------------
---------------------- --------------------- ----------------------
---------------------- --------------------- ----------------------
TOTALS ---------------------- --------------------- ----------------------
STORAGE AND HANDLING CHARGES: Storage charges of____________________________________________
per calendar day per contract, minimum______________________________________________________ per
contract, plus_________________________________________________ handling charge per contract for
each deposit and withdrawal.
Endorsements
Date______________________________ By___________________________________
Date______________________________ By___________________________________
Date______________________________ By___________________________________
9025A
(01/01/00)
A1546.01 Date of Delivery - Where Gold is sold for delivery in specified
month, delivery of such Gold may be made by the Seller upon such day of the
specified month as the Seller may select. If not previously delivered, delivery
must be made upon the last business day of the month. (09/01/94)
A1547.01 Delivery Notices - (See 1047.01) (09/01/94)
Ch15A Delivery Procedures
-------------------------
A1548.01 Method of Delivery - (See 1048.01) (09/01/94)
A1549.00 Time of Delivery, Payment, Form of Delivery Notice - (See
1049.00) (09/01/94)
A1549.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
A1549.03 Sellers' Invoice to Buyers - In addition to the requirements of
1049.03, the seller shall mail a copy of the invoice to the vault or vaults who
issued the vault receipts being delivered. The seller will thereby notify the
vault of the transfer of ownership of the indicated vault receipts from the
seller to the buyer. The seller will be responsible for the payment of storage
charges unless the vault has been notified thereby. (09/01/94)
A1549.04 Payment - Payment is to be made by a check drawn on and certified
by a Chicago bank or by a Cashier's check issued by a Chicago bank. (09/01/94)
A1550.00 Duties of Members - (See 1050.00) (09/01/94)
A1551.01 Office Deliveries Prohibited - (See 1051.01) (09/01/94)
A1554.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
A1556.01 Storage and Transfer Fees - Storage charges, transfer fees and
in-and-out charges shall be set by each depository vault and the schedule of
such charges shall be posted with the Association, which shall be notified at
least 60 days in advance of any changes in the rate schedule. Except as
otherwise provided, all charges for storage, etc., shall remain the
responsibility of the Seller until payment is made. (09/01/94)
Ch15A Regularity of Vaults
A1580.01 Duties of Vault Operators - It shall be the duty of the operators
of all regular vaults:
(a) to accept Gold for delivery on Chicago Board of Trade contracts provided
such Gold is ordered into the Vault by a Clearing Member of the
Association, and all space in such vaults allotted for such purposes is
not already filled or contracted for.
(b) to ascertain that Gold bars are weighed by a weigher approved by the
Association.
(c) to notify the Board of Trade of any change in the condition of their
vaults.
(d) to release to the bearer of a receipt the bar covered by said receipt
upon presentation of the receipt and payment of all storage and other
charges no later than three business days following compliance with
these provisions.
(e) to keep Gold in storage in balance with Gold represented by its
outstanding vault receipts. (09/01/94)
A1581.01 Conditions of Regularity - Companies operating depository vaults
as owners or lessees (hereinafter called "operators") who desire to have such
depository vaults made regular for delivery of Gold under the Rules and
Regulations shall make application for a Declaration of Regularity on a Form
prescribed by the Exchange for a two year term expiring June 30, 1994 and every
even year thereafter. Application for renewal of regularity must be made prior
to May 1, 1994, and every even year thereafter, in each year for the respective
years beginning July 1, 1994, and every even year thereafter, and shall be on
the same form. If the Exchange approves such application, the Declaration of
Regularity shall be posted on the bulletin board and thereafter the vault
receipts for Gold stored in such vaults shall be deliverable in satisfaction of
futures contracts under the Rules and Regulations. The following shall
constitute the requirements and conditions for regularity:
(1) The vault making application shall be inspected.
(2) The operator of such vault must be a Bank (either federal or state
charter), or an entity owned and controlled by any such bank with
capital (Capital, surplus and undivided earnings) in excess of
$250,000,000 or be a depository corporation with first loss insurance of
$250,000,000 issued by an insurer satisfactory to the Chicago Board of
Trade. The Exchange may also require whatever sureties it deems
necessary.
(3) Such vault shall be provided with standard equipment and appliances for
the convenient and safe storage of Gold, the weighing of Gold, and
provide for proper security.
(4) The operator of such vault shall furnish to the Registrar all needed
information to enable him to keep a correct record and account of all
Gold received and delivered by them daily and of that remaining in store
at the close of each week.
(5) The operator of such vault shall accord every facility to any duly
authorized committee for the examination of its books or records for the
purpose of ascertaining the stocks of Gold. The Exchange shall have the
authority to employ experts to determine the quantity and quality of
Gold in said vault.
(6) No vault shall be deemed suitable to be declared regular if its
location, accessibility, tariffs, or other qualifications shall depart
from uniformity to the extent that its receipts as tendered in
satisfaction of futures contracts will unduly depress the values of
futures contracts or impair the efficacy of futures trading in this
market, or if the operator of such vault engages in unethical or
inequitable practices, or if the operator fails to comply with any laws,
Federal or State, or Rules or Regulations promulgated under those laws.
(7) The operator shall make such reports, keep such records, and permit such
vault visitation as the Board of Trade may prescribe, and shall comply
with all applicable Rules and Regulations.
(8) Depository vaults must be in the City of Chicago, Illinois or in New
York, New York. (09/01/94)
A1584.01 Revocation of Regularity - Any regular vault may be declared by
the Business Conduct Committee or, pursuant to Regulation 540.10, the Hearing
Committee, to be irregular at any time if it
Ch15A Regularity of Vaults
--------------------------
does not comply with the conditions above set forth, or fails to carry out its
prescribed duties. If the designation of a vault as regular shall be revoked, a
notice of such revocation shall be posted on the Bulletin board. Such notice
shall state the period of time, if any, during which the receipts issued by such
vault shall thereafter be deliverable in satisfaction of futures contracts in
Gold under the Rules and Regulations. (09/01/94)
A1585.01 Application for Declaration of Regularity - All applications by
operators of vaults for a Declaration of Regularity under Regulation 1581.01
shall be on the following form:
APPLICATION FOR A DECLARATION OF REGULARITY FOR
THE STORAGE OF GOLD UPON CONTRACTS FOR FUTURE
DELIVERY UNDER THE CHARTER, RULES AND REGULATIONS
OF THE BOARD OF TRADE OF THE CITY OF CHICAGO.
Board of Trade of the City of Chicago
141 West Jackson Boulevard
Chicago, Illinois 60604
Gentlemen:
_________________________________________(hereinafter called Vault),
located at________________________ and licensed____________________
and incorporated under the laws of_________________________, having
allocated storage capacity of____________ Troy ounces (hereinafter
called Regular Capacity) for the storage of Gold for delivery in
satisfaction of futures contracts on the Board of Trade of the City
of Chicago (hereinafter called Exchange), does hereby make
application to the Exchange for a Declaration of Regularity to
handle, receive and store Gold (hereinafter called Gold) for a period
beginning__________________ and ending midnight June 30, 20______.
Conditions of Regularity
Such Declaration of Regularity, if granted, shall be cancellable by
the Exchange whenever the following conditions shall not be observed:
1. The Vault must:
(1) give such bonds to the Exchange as it may reasonably
require.
(2) notify the Exchange promptly of any material change
in ownership or condition of its premises.
(3) make such reports, keep such records, and permit such
inspections as the Exchange may reasonably prescribe.
(4) comply with all applicable Rules and Regulations of
the Exchange; and comply with all requirements of the
Exchange permitted or required by such Rules and
Regulations.
2. The Vault must be:
(1) in the City of Chicago, Illinois or in New York, New
York
(2) properly safeguarded and equipped to weigh and to
provide safe and convenient storage of Gold.
Agreements of Vault
The Vault expressly agrees:
(1) in the event of revocation or expiration of regularity, to
bear the expenses of the transfer of Gold under bond to
another regular vault satisfactory to the holders of its vault
receipts.
(2) neither to withdraw as a regular vault nor withdraw any
Regular Capacity during the life of this Declaration of
Regularity except after sixty (60) days notice to the Exchange
or having obtained the consent of the Exchange.
(3) to notify the Exchange at least sixty (60) days in advance of
any changes in its maximum storage and handling charges as
shown in the attached schedule.
Submitted herewith is a specimen of the Vault's proposed vault
receipt.
_________________________________
______________________________ By_______________________________
Date Title
This application is approved and a Declaration of Regularity is
hereby granted.
Board of Trade of the City of Chicago
_________________________________
Ch15A Regularity of Vaults
--------------------------
Date
By_____________________________________
Secretary
7079
(01/01/00)
A1586.01 Regular Vault - (See Appendix 15B) (09/01/94)
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================================================================================
Chapter 15B
100 Ounce Gold Futures
================================================================================
Ch15B Trading Conditions.....................................................................
B1501.00 Authority...................................................................
B1502.01 Application of Regulations..................................................
B1504.01 Unit of Trading.............................................................
B1505.01 Months Traded In............................................................
B1506.01 Price Basis.................................................................
B1507.01 Hours in Trading............................................................
B1508.01 Trading Limits..............................................................
B1508.01A Trading Limits..............................................................
B1509.01 Last Day of Trading.........................................................
B1509.02 Trading in the Last Three Days of the Delivery Month........................
B1510.01 Margin Requirements.........................................................
B1511.01 Disputes....................................................................
B1512.01 Position Limits and Reportable Positions....................................
Ch15B Delivery Procedures....................................................................
B1536.01 Standards...................................................................
B1540.01 Brands and Markings of Gold.................................................
B1540.02 Withdrawal of Approval of Gold Brands and Markings..........................
B1540.03 Approved Brands.............................................................
B1540.04 Assaying....................................................................
B1541.01 Delivery Points.............................................................
B1542.01 Deliveries by Vault Receipts................................................
B1543.01 Issuance of Vault Receipts..................................................
B1543.02 Deposit of Gold with Vaults.................................................
B1544.01 Receipt Format..............................................................
B1546.01 Date of Delivery............................................................
B1547.01 Delivery Notices............................................................
B1548.01 Method of Delivery..........................................................
B1549.00 Time of Delivery, Payment, Form of Delivery Notice..........................
B1549.02 Buyers' Report of Eligibility to Receive Delivery...........................
B1549.03 Sellers' Invoice to Buyers..................................................
B1549.04 Payment.....................................................................
B1550.00 Duties of Members...........................................................
B1551.01 Office Deliveries Prohibited................................................
B1554.00 Failure to Accept Delivery..................................................
B1556.01 Storage and Transfer Fees...................................................
Ch15B Regularity of Vaults...................................................................
B1580.01 Duties of Vault Operators...................................................
B1581.01 Conditions of Regularity....................................................
B1584.01 Revocation of Regularity....................................................
B1585.01 Application for Declaration of Regularity...................................
B1586.01 Regular Vault...............................................................
===============================================================================
Chapter 15B
100 Ounce Gold Futures
===============================================================================
Ch15B Trading Conditions
B1501.00 Authority - Whenever it shall be permitted by the U.S. Government
trading in Gold may be conducted under such terms and conditions as may be
prescribed by regulation. (09/01/94)
B1502.01 Application of Regulations - Transactions in Gold futures shall be
subject to the general rules of the Association as far as applicable to trading
in Gold.
For the purposes of this chapter, the trading day begins with the commencement
of trading in each evening session and ends with the close of trading in the
next afternoon session. (09/01/94)
B1504.01 Unit of Trading - The unit of trading shall be 100 fine troy ounces
of gold. Bids and offers may be accepted in lots of 100 fine troy ounces or
multiples thereof. (09/01/94)
B1505.01 Months Traded In - Trading in Gold may be conducted in the current
month and any subsequent months. (09/01/94)
B1506.01 Price Basis - All prices of gold shall be basis in store in approved
vaults in Chicago, Illinois, or New York, New York, in multiples of ten cents
per fine troy ounce. Contracts shall not be made on any other price basis.
(09/01/94)
B1507.01 Hours in Trading - The evening hours of trading for future delivery
in Gold shall be determined by the Board. The daytime hours of trading for
future delivery in Gold shall be from 7:20 a.m. to 1:40 p.m. On the last day of
trading in an expiring future, the closing time with respect to such future
shall be 1:40 p.m. subject to the otherwise applicable provisions of the second
paragraph of Rule 1007.00. (09/01/94)
B1508.01 Trading Limits - (See 1008.01) (09/01/94)
B1508.01A Trading Limits - (See 1008.01A) (09/01/94)
B1509.01 Last Day of Trading - No trades in Gold futures deliverable in the
current month shall be made during the last three business days of that month
and any contracts remaining open must be settled by delivery or as provided in
Regulation 1509.02 after trading in such contracts has ceased; and if not
previously delivered, delivery must be made no later than the last business day
of the month. Tender shall be one business day prior to delivery. As is the case
with other contracts, delivery notices and supporting data processing (Delivery)
cards must be made delivered to the Clearing Corporation by 4:00 p.m. on
position day except that, on the last notice day of the delivery month, delivery
notices and supporting data processing cards may be delivered to the Clearing
Corporation until 2:00 p.m. on intention day. (09/01/94)
B1509.02 Trading in the Last Three Days of the Delivery Month - After trading
in contracts for future delivery in the current delivery month has ceased in
accordance with Regulation 1509.01 of this chapter, outstanding contracts for
such delivery may be liquidated by means of a bona fide exchange of such current
futures for the actual cash commodity. Such exchange must, in any event, be made
no later than the last business day of the delivery month. (09/01/94)
B1510.01 Margin Requirements - (See Regulation 431.03) (09/01/94)
B1511.01 Disputes - All disputes between interested parties may be settled by
arbitration as provided in the Rules and Regulations. (09/01/94)
B1512.01 Position Limits and Reportable Positions - (See 425.01) (09/01/94)
Ch15B Delivery Procedures
B1536.01 Standards - Each futures contract made under these regulations shall
be for 100 fine troy ounces of gold, although variation in the quantity of the
delivery unit not in excess of five percent of 100 fine troy ounces shall be
permitted. Delivery shall be by no more than three cast bars of refined gold, no
less than 995 fine and bearing brands and markings officially approved by the
Exchange; and no bar which contains less than 31 fine troy ounces of gold may be
delivered in fulfillment of a contract.
Settlement shall be the basis of the fine ounces of gold delivered. Refined gold
of fineness above 999.9 shall be considered to be 999.9 pure for the purpose of
calculating the fine gold content. (09/01/94)
B1540.01 Brands and Markings of Gold - Brands and markings deliverable in
satisfaction of futures contracts shall be listed with the Board of Trade upon
approval by the Exchange. The Exchange may require such sureties as it deems
necessary. The Secretary's Office shall keep on file the brands and markings of
Gold bars which are deliverable. The addition of brands and markings shall be
binding upon all contracts outstanding as well as those entered into after
approval. (09/01/94)
B1540.02 Withdrawal of Approval of Gold Brands and Markings - If at anytime a
brand and marking fails to meet the requirements adopted by the Exchange or the
metallurgical assay of any gold bars bearing a brand and marking on the official
list depreciates below 995 fineness, the Exchange may exclude said brand and
marking from the official list unless deliveries of bars bearing said brand and
marking are accompanied by certificates of analysis of an official assayer
showing a gold fineness of not less than 995, and such additional bond as the
Exchange may deem necessary. Notice of such action shall be given promptly in
writing to each regular vault and shall be posted upon the bulletin board of the
Association and the official list shall indicate the limitation upon deliveries
of said brand and marking. (09/01/94)
B1540.03 Approved Brands - (See Appendix 15A) (09/01/94)
B1540.04 Assaying - The Board of Trade at its sole discretion shall have the
authority at any time to have assayed any Gold bars covered by vault receipts
delivered against futures contracts. Costs to be borne by the Board of Trade.
(09/01/94)
B1541.01 Delivery Points - Gold located at regular vaults at points approved
by the Exchange (Regulation 1581.01) may be delivered in satisfaction of futures
contracts. (09/01/94)
B1542.01 Deliveries by Vault Receipts - Deliveries on Gold futures contracts
shall be made by the delivery of depository vault receipts issued by vaults
which have been approved and designated by the Board as regular vaults for the
storage of Gold. Gold bars must be good delivery bars as defined by Board
regulations and shipped under bond directly to the regular vault from an
approved vault; or must be bars purchased from an approved source and shipped
directly from that source under bond to the regular vault. Gold bars entering a
regular vault for delivery must be weighed at the vault by a weigher approved by
the Association.
The gross weight of bars shall be recorded by the approved weigher on the vault
receipt (Regulation 1544.01) to the nearest one thousandth (0.001) of a troy
ounce. The vault receipts issued by Chicago vaults shall evidence that storage
charges have been paid up to and including the end of the calendar quarter. A
clearing member delivering a New York vault receipt must also tender an
attachment stating that storage charges have been paid up to and including the
end of the calendar quarter. Prepaid Storage Charges shall be charged to the
buyer by the seller from the date of delivery to the expiration of the storage
charge period. In order to effect a valid delivery, each vault receipt must be
endorsed by the clearing member making delivery. If the owner removes gold from
a vault, any prepaid storage charges shall be refunded by the vault to the owner
from the date of removal of the gold to the expiration of the storage charge
period.
By the tender of a vault receipt for Gold duly endorsed for delivery on an
Exchange contract, the endorser shall be deemed to warrant, to his transferee
and each subsequent transferee of the receipt for delivery on Exchange
contracts, and their respective immediate principals, the genuineness and worth
of such receipt, the rightfulness and effectiveness of the transfer thereof, and
the quantity and quality of the Gold shown on the receipt.
Ch15B Delivery Procedures
--------------------------
In the event that such Exchange member or principal shall claim a breach of such
warranty, and such claim relates to the quantity or quality of the Gold, the lot
shall be immediately submitted for sampling and assaying to any assayer approved
by the Exchange; the gold must be shipped under bond, and at the owner's
expense, to the assayer. The expense of sampling and assaying shall in the first
instance, be borne by the claimant. If a deficiency in quantity or quality shall
be determined by the assayer, the claimant shall have the right to recover the
difference in the market value and expenses incurred in connection with the
sampling and assaying and any cost of replacement of Gold. The claimant may, at
his option, proceed directly against the original endorser of the warehouse or
vault receipt upon Exchange delivery, or against any endorser prior to claimant
without seeking recovery from his immediate deliverer on the Exchange contract
and if the claim is satisfied by the original endorser of the warehouse or vault
receipt, or any other endorser, all the endorsers will be thereby discharged
from liability to the claimant. If the claimant seeks recovery from any endorser
and his claim is satisfied by such endorser, the party thus satisfying the claim
will have a similar option to claim recovery directly from any endorser prior to
him. Such claims as are in dispute between members of the Exchange may in each
case be submitted to arbitration under the Rules of the Exchange.
The liability of an endorser of a vault receipt as provided herein shall not be
deemed to limit the rights of such endorser against any person or party for
whose account the endorser acted in making delivery on an Exchange contract. If
it shall be determined in such arbitration proceeding that any endorser of a
vault receipt or the person or party for whom such endorser acted was aware of
the breach of warranty or was involved in a plan or agreement with the original
endorser (or his principal) to place such inferior Gold in licensed store for
use in deliveries upon Exchange contracts, such endorsers shall not be entitled
to recover from any prior endorser for the breach of warranty. (09/01/94)
B1543.01 Issuance of Vault Receipts - Vault receipts, in order to be eligible
for delivery, must be issued by a regular vault according to the following
procedures and with the following documentation retained by the regular vault:
(1) For all vault receipts:
(a) Receipts shall be issued in numerical order.
(b) Copies shall be kept of any cancelled or voided receipts.
(c) A record shall be kept of the bar number and the corresponding receipt
number.
(2) For gold delivered into the vault directly from a refiner or an approved
source:
(a) Copy of the bar listing which depicts the date of smelting, serial
numbers, brand marking and troy ounces.
(b) Copy of the bonded carrier receipt for the transport of the gold from
the refiner or the approved source directly into the regular vault.
(3) For gold converted from a receipt issued by another exchange:
(a) A copy of such other exchange's receipt which has been cancelled.
Regular vaults shall also notify the Board of Trade each day that there is a
change in the number of its outstanding vault receipts. (09/01/94)
B1543.02 Deposit of Gold with Vaults - Gold in bars must be ordered into a
regular vault by a clearing member of the Association who shall furnish the
vault with the following written notice:
1. Request to receive gold.
2. Brands and markings.
3. Number of bars.
4. Identification (serial number) of each bar.
5. Weight of each bar.
6. Source.
7. Clearing member.
Ch15B Delivery Procedures
-------------------------
8. Carrier.
9. Date of arrival.
Shipment must be prepaid unless otherwise arranged with the regular vault.
(09/01/94)
B1544.01 Receipt Format - The following form of vault receipt shall be used:
______________________________________________________________________
(Name of Issuer)
______________________________________________________________________
(Address)
Bearer Receipt No.____________________________________________________
Chicago, Illinois________________, 20________
RECEIVED from_________________________________________________________
and stored at the above address in the safety deposit vaults of the
undersigned, as a Bailee, subject to the provisions of Article 7 of
the____________________________ Uniform Commercial Code and the terms
and conditions stated hereon, a gold bar SAID TO CONTAIN the amount
shown hereon of Gold of the fineness indicated.
Said bar is deliverable only at said vaults to the BEARER of this
receipt upon surrender hereof and upon payment of storage charges and
other proper charges and expenses relating to said bar, for which
charges and expenses the undersigned claims a lien.
Payment of handling charges for deposit of said bar and of storage
charges to the end of the current calendar quarter is hereby
acknowledged. Storage charges for each subsequent calendar quarter
are to be paid to the undersigned, in advance, at or before the
expiration of the preceding calendar quarter.
Bar identification markings of bar covered by this receipt, as shown
hereon, have been recorded by the undersigned on the basis of
markings appearing on said bar. THE UNDERSIGNED HAS NOT ASCERTAINED,
AND IS NOT RESPONSIBLE FOR, THE AUTHENTICITY OR CORRECTNESS OF
MARKINGS ON, OR THE CONTENT, WEIGHT OR FINENESS OF, SAID BAR.
____________________________________________________________________
(Issuer)
By________________________________
(Authorized Signature)
Gross Weight as determined by a weigher approved by the Board of
Trade of the City of Chicago________________troy ounces.
_________________________________
Approved weigher of the Board of
Trade of the City of Chicago
BAR IDENTIFICATION MARKINGS
--------------------------------------------------------------------------------
Gross Weigh
---------------------------------------
Serial Number Troy Ounces Kilograms Mark or Brand Fineness
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTALS -----------------------------------------------
STORAGE AND HANDLING CHARGES: Storage charges of_____________________
per calendar day per contract, minimum___________________________ per
contract, plus_____________________________ handling charge per
contract for each deposit and withdrawal.
Endorsements
Date______________________________ By____________________________
Date______________________________ By____________________________
Date______________________________ By____________________________
(01/01/00)
Ch15B Delivery Procedures
-------------------------
B1546.01 Date of Delivery - Where Gold is sold for delivery in specified
month, delivery of such Gold may be made by the seller upon such day of the
specified month as the seller may select. If not previously delivered, delivery
must be made upon the last business day of the month. (09/01/94)
B1547.01 Delivery Notices - (See 1047.01) (09/01/94)
B1548.01 Method of Delivery - (See 1048.01) (09/01/94)
B1549.00 Time of Delivery, Payment, Form of Delivery Notice - (See 1049.00)
(09/01/94)
B1549.02 Buyers' Report of Eligibility to Receive Delivery - (See 1049.02)
(09/01/94)
B1549.03 Sellers' Invoice to Buyers - In addition to the requirements of
Regulation 1049.03, the seller shall mail a copy of the invoice to the vault or
vaults who issued the vault receipts being delivered. The seller will thereby
notify the vault of the transfer of ownership of the indicated vault receipts
from the seller to the buyer. The seller will be responsible for the payment of
storage charges unless the vault has been notified thereby. (09/01/94)
B1549.04 Payment - Payment is to be made by a check drawn on and certified by
a Chicago bank or by a Cashier's check issued by a Chicago bank. (09/01/94)
B1550.00 Duties of Members - (See 1050.00) (09/01/94)
B1551.01 Office Deliveries Prohibited - (See 1051.01) (09/01/94)
B1554.00 Failure to Accept Delivery - (See 1054.00) (09/01/94)
B1556.01 Storage and Transfer Fees - Storage charges, transfer fees and in-and-
out charges shallbe set by each depository vault and the schedule of such
charges shall be posted with the Association, which shall be notified at least
60 days in advance of any changes in the rate schedule. Except as otherwise
provided, all charges for storage, etc., shall remain the responsibility of the
Seller until payment is made. (09/01/94)
Ch15B Regularity of Vaults
B1580.01 Duties of Vault Operators - It shall be the duty of the operators of
all regular vaults:
(a) to accept Gold for delivery on Chicago Board of Trade contracts provided
such Gold is ordered into the Vault by a Clearing Member of the
Association, and all space in such vaults allotted for such purposes is
not already filled or contracted for.
(b) to ascertain that Gold bars are weighed by a weigher approved by the
Association.
(c) to notify the Board of Trade of any change in the condition of their
vaults.
(d) to release to the bearer of a receipt the bars covered by said receipt
upon presentation of the receipt and payment of all storage and other
charges no later than three business days following compliance with
these provisions.
(e) to keep Gold in storage in balance with Gold represented by its
outstanding vault receipts. (09/01/94)
B1581.01 Conditions of Regularity - Companies operating depository vaults as
owners or lessees (hereinafter called "operators") who desire to have such
depository vaults made regular for delivery of Gold under the Rules and
Regulations shall make application for a Declaration of Regularity on a form
prescribed by the Exchange. Application for renewal of regularity must be made
prior to May 1 in each year for the year beginning July 1 and shall be on the
same form. If the Exchange approved such application, the Declaration of
Regularity shall be posted on the bulletin board and thereafter the vault
receipts for Gold stored in such vaults shall be deliverable in satisfaction of
futures contracts under the Rules and Regulations. The following shall
constitute the requirements and conditions for regularity:
(1) The vault making application shall be inspected.
(2) The operator of such vault must be a Bank (either federal or state
charter), or an entity owned and controlled by any such bank with capital
(Capital, surplus and undivided earnings) in excess of $250,000,000 or be
a depository corporation with first loss insurance of $250,000,000 issued
by an insurer satisfactory to the Chicago Board of Trade. The Exchange may
also require whatever sureties it deems necessary.
(3) Such vault shall be provided with standard equipment and appliances for
the convenient and safe storage of Gold, the weighing of Gold, and provide
for proper security.
(4) The operator of such vault shall furnish to the Registrar all needed
information to enable him to keep a correct record and account of all Gold
received and delivered by them daily and of that remaining in store at the
close of each week.
(5) The operator of such vault shall accord every facility to any duly
authorized committee for the examination of its books or records for the
purpose of ascertaining the stocks of Gold. The Exchange shall have the
authority to employ experts to determine the quantity and quality of Gold
in said vault.
(6) No vault shall be deemed suitable to be declared regular if its location,
accessibility, tariffs, or other qualifications shall depart from
uniformity to the extent that its receipts as tendered in satisfaction of
futures contracts will unduly depress the values of futures contracts or
impair the efficacy of futures trading in this market, or if the operator
of such vault engages in unethical or inequitable practices, or if the
operator fails to comply with any laws, Federal or State, or Rules or
Regulations promulgated under those laws.
(7) The operator shall make such reports, keep such records, and permit such
vault visitation as the Board of Trade may prescribe, and shall comply
with all applicable Rules and Regulations.
(8) Depository vaults must be in the City of Chicago, Illinois or in New York,
New York. (09/01/94)
B1584.01 Revocation of Regularity - Any regular vault may be declared by the
Business Conduct Committee or, pursuant to Regulation 540.10, the Hearing
Committee to be irregular at any time if it does not comply with the conditions
above set forth, or fails to carry out its prescribed duties. If the designation
of a vault as regular shall be revoked, notice of such revocation shall be
posted on the
Ch15B Regularity of Vaults
---------------------------
bulletin board. Such notice shall state the period of time, if any, during which
the receipts issued by such vault shall thereafter be deliverable in
satisfaction of futures contracts in Gold under the Rules and Regulations.
(09/01/94)
B1585.01 Application for Declaration of Regularity - All applications by
operators of vaults for a Declaration of Regularity under Regulation 1581.01
shall be on the following form:
APPLICATION FOR A DECLARATION OF REGULARITY FOR
THE STORAGE OF GOLD UPON CONTRACTS FOR FUTURE
DELIVERY UNDER THE CHARTER, RULES AND REGULATIONS
OF THE BOARD OF TRADE OF THE CITY OF CHICAGO.
Board of Trade of the City of Chicago
141 West Jackson Boulevard
Chicago, Illinois 60604
Gentlemen:
________________________________________________(hereinafter called
Vault), located at___________________________ and
licensed_________________________ and incorporated under the laws
of____________________________, having allocated storage capacity
of____________ Troy ounces (hereinafter called Regular Capacity) for the
storage of Gold for delivery in satisfaction of futures contracts on the
Board of Trade of the City of Chicago (hereinafter called Exchange), does
hereby make application to the Exchange for a Declaration of Regularity to
handle, receive and store Gold (hereinafter called Gold) for a period
beginning__________________ and ending midnight June 30, 20______.
Conditions of Regularity
Such Declaration of Regularity, if granted, shall be cancellable by the
Exchange whenever the following conditions shall not be observed:
1. The Vault must:
(1) give such bonds to the Exchange as may be reasonably
required by the Exchange.
(2) notify the Exchange promptly of any material change in
ownership or condition of its premises.
(3) make such reports, keep such records, and permit such
inspections as the Exchange may reasonably prescribe.
(4) comply with all applicable Rules and Regulations of the
Exchange; and comply with all requirements of the Exchange
permitted or required by such Rules and Regulations.
2. The Vault must be:
(1) in the City of Chicago, Illinois or in New York, New York
(2) properly safeguarded and equipped to weigh and to provide
safe and convenient storage of Gold.
Agreements of Vault
The Vault expressly agrees:
(1) in the event of revocation or expiration of regularity, to bear the
expenses of the transfer of Gold under bond to another regular
vault satisfactory to the holders of its vault receipts.
(2) neither to withdraw as a regular vault nor withdraw any Regular
Capacity during the life of this Declaration of Regularity except
after sixty (60) days notice to the Exchange or having obtained the
consent of the Exchange.
(3) to notify the Exchange at least sixty (60) days in advance of any
changes in its maximum storage and handling charges as shown in the
attached schedule.
Submitted herewith is a specimen of the Vault's proposed vault receipt.
______________________________
_______________________ By____________________________
Date Title
This application is approved and a Declaration of Regularity is
hereby granted.
Board of Trade of the City of Chicago
________________________________
Ch15B Regularity of Vaults
--------------------------
Date
By_______________________________
Secretary
7079
(01/01/00)
B1586.01 Regular Vault - (See Appendix 15B) (09/01/94)
================================================================================
Chapter 16
Silver Futures Options
================================================================================
Ch16 Trading Conditions..............................................
1601.00 Authority............................................
1601.01 Application of Regulations...........................
1602.01 Nature of Silver Futures Put Options.................
1602.02 Nature of Silver Futures Call Options................
1603.01 Trading Unit.........................................
1604.01 Striking Prices......................................
1605.01 Payment of Option Premium............................
1606.01 Option Premium Basis.................................
1607.01 Exercise of Option...................................
1607.02 Automatic Exercise...................................
1608.01 Expiration of Option.................................
1609.01 Months Traded........................................
1610.01 Trading Hours........................................
1611.01 Position Limits......................................
1612.01 Margin Requirements..................................
1613.01 Last Day of Trading..................................
1614.01 Option Premium Fluctuation Limits....................
================================================================================
Chapter 16
Silver Futures Options
================================================================================
Ch16 Trading Conditions
1601.00 Authority - (See Rule 2801.00). (10/01/94)
1601.01 Application of Regulations - Transactions in put and call options on
Silver futures contracts shall be subject to the general rules of the
Association as far as applicable and shall also be subject to the regulations
contained in this chapter which are exclusively applicable to trading in put and
call options on Silver futures contracts. (See Rule 490.00). (10/01/94)
1602.01 Nature of Silver Futures Put Options - The buyer of one (1) Silver
futures put option may exercise his option at any time prior to expiration,
(subject to Regulation 1607.01), to assume a short position in one (1) Silver
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Silver futures put option
incurs the obligation of assuming a long position in one (1) Silver futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a put option buyer. (10/01/94)
1602.02 Nature of Silver Futures Call Options - The buyer of one (1) Silver
futures call option may exercise his option at any time prior to expiration,
(subject to Regulation 1607.01), to assume a long position in one (1) Silver
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Silver futures call option
incurs the obligation of assuming a short position in one (1) Silver futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a call option buyer. (10/01/94)
1603.01 Trading Unit - One (1)1,000 ounce Silver futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
1604.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of:
(i) twenty-five (25) cents per troy ounce for strike prices less than eight
dollars;
(ii) fifty (50) cents per troy ounce for strike prices greater than or equal to
eight dollars but less than twenty dollars;
(iii) one (1) dollar per troy ounce for strike prices equal to or greater than
twenty dollars.
At the commencement of trading the following options striking prices shall be
listed for each listed month: one with a striking price closest to the previous
day's settlement price on the underlying Silver futures contract month and the
next three consecutive higher and next three consecutive lower striking prices
closest to the previous day's settlement price. If the previous day's settlement
price is midway between two striking prices, the closest price shall be the
larger of the two.When a sale in the underlying Silver futures contract occurs
at a price greater than or equal to the price which is midway between the third
largest and fourth largest striking prices, a new striking price one increment
higher than the existing striking prices will be added. When a sale in the
underlying futures contract occurs at a price which is greater than or equal to
the price which is midway between the second and third highest striking prices,
two new striking prices one increment and two increments higher than the
existing striking prices will be added. When a sale in the underlying Silver
futures contract occurs at a price less than or equal to the price which is
midway between the third smallest and fourth smallest striking prices, a new
striking price one increment lower than the existing striking prices will be
added. When a sale in the underlying futures contract occurs at a price which is
less than or equal to the price which is midway between the second and third
lowest striking prices, two new striking prices one increment and two increments
lower than the existing striking prices will be added. All new striking prices
will be added prior to the opening of trading on the following business day.
No new striking prices may be added to an option during the month in which it
expires. The Exchange may modify the procedure for the introduction of striking
prices as it deems appropriate in order to
Ch16 Trading Conditions
-----------------------
respond to market conditions. (10/01/94)
1605.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
1606.01 Option Premium Basis - The premium for Silver futures options shall be
in multiples of ten one-hundredths (10/100) of one cent per troy ounce (one
dollar ($1.00) per option contract) of a 1,000 ounce Silver futures contact.
However, when both sides of the trade are closing transactions, the option
premium may be equal to $1.00 (one dollar) per option contract. (10/01/94)
1607.01 Exercise of Option - The buyer of a Silver futures option may exercise
the option on any business day prior to expiration by giving notice of exercise
to the Clearing Corporation by 6:00 p.m., or by such other time designated by
the Board of Directors, on such day. Notwithstanding the foregoing, the buyer
may exercise the option prior to 10:00 a.m. on expiration date:
(i) to correct errors or mistakes made in good faith;
(ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
(iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
1607.02 Automatic Exercise - Notwithstanding the provisions of Regulation
1607.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
(i) to correct errors or mistakes made in good faith;
(ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
(iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
1608.01 Expiration of Option - Unexercised Silver futures options shall expire
at 10:00 a.m. on the first Saturday following the last day of trading.
(10/01/94)
1609.01 Months Traded - Trading may be conducted in Silver futures options in
the following months: February, April, June, August, October, December for any
fourteen month period which begins with the current nearby option month,
provided however, that the Board or a Committee authorized by the Board may
determine not to list a contract month. There shall be no trading in Silver
futures put options for months in which Silver futures are not traded on the
Chicago Board of Trade. (10/01/94)
1610.01 Trading Hours - The hours of trading of options on Silver futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be 1:25 p.m., subject
to the otherwise applicable provisions of the second paragraph of Rule 1007.00.
On the last day of trading in an expiring option, the expiring Silver futures
options shall be closed with a public call made striking price by striking
price, conducted by such persons as the Regulatory Compliance Committee shall
direct. On all other days, Silver futures options shall be opened and closed
with a public call made month by month for all striking prices simultaneously
for all options which share a common expiration date. Each month for silver
futures options shall be opened and closed simultaneously with the opening and
closing of the same month for silver futures. The public call for opening and
closing Silver futures options shall be conducted by such persons as the
Regulatory Compliance Committee shall direct. (03/01/00)
1611.01 Position Limits - (See Regulation 425.01) (10/01/00)
Ch16 Trading Conditions
-----------------------
1612.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*1613.01 Last Day of Trading - No trades in Silver futures options expiring in
the current month shall be made after 1:25 p.m. on the last Friday which
precedes by at least two [five] business days, the first notice day for the
corresponding Silver futures contract. If such Friday is not a business day, the
last day of trading shall be the business day prior to such Friday. (03/01/00)
*Additions underlined, deletions bracketed for contracts from December 2000
forward.
1614.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Silver futures option at a premium
of more than the trading limit for the Silver futures contract above and below
the previous day's settlement premium for that option as determined by the
Clearing Corporation. On the first day of trading, limits shall be set from the
lowest premium of the opening range. (10/01/94)
[Enlarge/Download Table]
=======================================================================================================================
Chapter 18
U.S. Treasury Bonds
=======================================================================================================================
Ch18 Trading Conditions.........................................................................
1801.00 Authority......................................................................
1802.01 Application of Regulation......................................................
1804.01 Unit of Trading................................................................
1805.01 Months Traded In...............................................................
1806.01 Price Basis....................................................................
1806.01 Price Basis....................................................................
1807.01 Hours of Trading...............................................................
1808.01 Trading Limits.................................................................
1808.01A Trading Limits.................................................................
1809.01 Last Day of Trading............................................................
1809.02 Liquidation in the Last Seven Days of the Delivery Month.......................
1810.01 Margin Requirements............................................................
1812.01 Position Limits and Reportable Positions.......................................
Ch18 Delivery Procedures........................................................................
1836.01 Standards......................................................................
1842.01 Deliveries on Futures Contracts................................................
1842.02 Wire Failure...................................................................
1846.01 Date of Delivery...............................................................
1847.01 Delivery Notices...............................................................
1848.01 Method of Delivery.............................................................
1849.00 Time of Delivery, Payment, Form of Delivery Notice.............................
1849.02 Buyer's Report of Eligibility to Receive Delivery..............................
1849.03 Seller's Invoice to Buyers.....................................................
1849.04 Payment........................................................................
1849.05 Buyers Banking Notification....................................................
1850.00 Duties of Members..............................................................
1851.01 Office Deliveries Prohibited...................................................
1854.00 Failure to Accept Delivery.....................................................
Ch18 Regularity of Banks........................................................................
1880.01 Banks..........................................................................
================================================================================
Chapter 18
U.S. Treasury Bonds
================================================================================
Ch18 Trading Conditions
1801.00 Authority - (See Rule 1701.00) (10/01/94)
1802.01 Application of Regulations - Futures transactions in long term U.S.
Treasury bonds shall be subject to the general rules of the Association as far
as applicable and shall also be subject to the regulations contained in this
chapter, which are exclusively applicable to trading in long term U.S. Treasury
bonds. 3000 (09/01/00)
1804.01 Unit of Trading - The unit of trading shall be United States Treasury
bonds having a face value at maturity of one hundred thousand dollars ($100,000)
or multiples thereof. 3002 (10/01/94)
1805.01 Months Traded In - Trading in long-term U.S. Treasury bonds may be
scheduled in such months as determined by the Exchange. (03/01/00)
1806.01 Price Basis - Minimum price fluctuations shall be in multiples of one
thirty-second (1/32) point per 100 points ($31.25 per contract) except for
intermonth spreads for contracts traded by open outcry only, where minimum price
fluctuations shall be in multiples of one-fourth of one-thirty-second point per
100 points ($7.8125 per contract). Par shall be on the basis of 100 points.
Contracts shall not be made on any other price basis. 3004 (10/01/98)
1807.01 Hours of Trading - The hours of trading for future delivery in U.S.
Treasury Bonds shall be determined by the Board. On the last day of the trading
in an expiring future, the closing time for such future shall be 12:00 noon,
subject to the provisions of the second paragraph of Rule 1007.00. The market
shall be opened and closed for all months simultaneously, or in such other
manner as the Regulatory Compliance Committee shall direct. 3007 (10/01/94)
1808.01 Trading Limits - (See Regulation 1008.01) (10/01/94)
1808.01A Trading Limits - (See Ruling 1008.01A) (10/01/94)
1809.01 Last Day of Trading - No trades in long term U.S. Treasury bond
futures deliverable in the current month shall be made during the last seven
business days of that month and any contracts remaining open must be settled by
delivery or as provided in Regulation 1809.02 after trading in such contracts
has ceased. 3008 (10/01/94)
1809.02 Liquidation in the Last Seven Days of the Delivery Month - After
trading in contracts for future delivery in the current delivery month has
ceased in accordance with Regulation 1809.01 of this chapter, outstanding
contracts may be liquidated by the delivery of book-entry U.S. Treasury bonds
(Regulation 1842.01) or by mutual agreement by means of a bona fide exchange of
such current futures for the actual long term U.S. Treasury bonds or comparable
instruments. Such exchange must, in any event, be made no later than the fifth
business day immediately preceding the last business day of the delivery month.
3009 (10/01/94)
1810.01 Margin Requirements - (See Regulation 431.03) (10/01/94)
1812.01 Position Limits and Reportable Positions - (See 425.01) (10/01/94)
Ch18 Delivery Procedures
1836.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be long term U.S. Treasury bonds which if callable
are not callable for at least 15 years or if not callable have a maturity of at
least 15 years. All bonds delivered against a contract must be of the same
issue. For settlement, the time to maturity (time to call if callable) of a
given issue is calculated in complete three month increments (i.e. 15 years and
5 months = 15 years and 1 quarter) from the first day of the delivery month. The
price at which a bond with this time to maturity (time to call if callable) and
with the same coupon rate as this issue will yield 6% according to bond tables
prepared by the Financial Publishing Co. of Boston, Mass., is multiplied times
the settlement price to arrive at the amount which the short invoices the long.
U.S. Treasury Bonds deliverable against futures contracts under these
regulations must have semi-annual coupon payments.
Interest accrued on the bonds shall be charged to the long by the short in
accordance with Department of the Treasury Circular 300, Subpart P.
New issues of long term U.S. Treasury bonds which satisfy the standards in this
regulation shall be added to the deliverable grade as they are issued. The
[Financial Instruments Committee or the] Board shall have the right to exclude
any new issue from deliverable status or to further limit outstanding issues
from deliverable status. 3001 (03/01/00)
1842.01 Deliveries on Futures Contracts - Deliveries against long term U.S.
Treasury bond futures contracts shall be by book-entry transfer between accounts
of Clearing Members at qualified banks (Regulation 1880.01) in accordance with
Department of the Treasury Circular 300, Subpart O: Book-Entry Procedure.
Delivery must be made no later than the last business day of the month. Notice
of intention to deliver shall be given to the Board of Trade Clearing
Corporation by 8:00 p.m. (Chicago time), or by such other time designated by the
Board of Directors, on the second business day preceding delivery day. In the
event the long Clearing Member does not agree with the terms of the invoice
received from the short Clearing Member, the long Clearing Member must notify
the short Clearing Member, and the dispute must be settled by 9:30 a.m. (Chicago
time) on delivery day. The short Clearing Member must have contract grade U.S.
Treasury bonds in place at his bank in acceptable (to his bank) delivery form no
later than 10:00 a.m. (Chicago time) on delivery day. The short Clearing Member
must notify his bank (Regulation 1880.01) to transfer contract grade U.S.
Treasury bonds by book-entry to the long Clearing Member's account at the long
Clearing Member's bank on a delivery versus payment basis. That is, payment
shall not be made until the bonds are delivered. On delivery day, the long
Clearing Member must make funds available by 7:30 a.m. (Chicago time) and notify
his bank (Regulation 1880.01) to accept contract grade U.S. Treasury bonds and
to remit federal funds to the short Clearing Member's account at the short
Clearing Member's bank (Regulation 1880.01) in payment for delivery of the
bonds. Contract grade U.S. Treasury bonds must be transferred and payment must
be made before 1:00 p.m. (Chicago time) on delivery day. All deliveries must be
assigned by the Clearing Corporation. Where a commission house as a member of
the Clearing Corporation has an interest both long and short for customers on
its own books, it must tender to the Clearing Corporation such notices of
intention to deliver as it received from its customers who are short. 3011
(12/01/99)
1842.02 Wire Failure - In the event that delivery cannot be accomplished
because of a failure of the Federal Reserve wire or because of a failure of
either the long Clearing Member's bank or the short Clearing Member's bank
access to the Federal Reserve wire, delivery shall be made before 9:30 a.m. on
the next business day on which the Federal Reserve wire or bank access to it is
operable. Interest shall accrue to the long paid by the short beginning on the
day on which the bonds were to be originally delivered.
In the event of such failure, both the long and short must provide documented
evidence that the instructions were given to their respective banks in
accordance with Regulations 1842.01 and 1849.04 and that all other provisions of
Regulations 1842.01 and 1849.04 have been complied with. 3014 (10/01/94)
1846.01 Date of Delivery -Delivery of U.S. Treasury bonds may be made by the
short upon any
Ch18 Delivery Procedures
------------------------
permissible delivery day of the delivery month the short may select. Delivery of
U.S. Treasury bonds must be made no later than the last business day of that
month. 3012 (10/01/94)
1847.01 Delivery Notices - (See Regulation 1047.01) (10/01/94)
1848.01 Method of Delivery - (See Regulation 1048.01) (10/01/94)
1849.00 Time of Delivery, Payment, Form of Delivery Notice - (See Rule
1049.00) (10/01/94)
1849.02 Buyer's Report of Eligibility to Receive Delivery - (See Regulation
1049.02) (10/01/94)
1849.03 Seller's Invoice to Buyers - Upon determining the buyers obligated to
accept deliveries tendered by issuers of delivery notices, the Clearing House
shall promptly furnish each issuer the names of the buyers obligated to accept
delivery from him and a description of each commodity tendered by him which was
assigned by the Clearing House to each such buyer. Thereupon, sellers (issuers
of delivery notices) shall prepare invoices addressed to their assigned buyers,
describing the documents to be delivered to each such buyer. Such invoices shall
show the amount which buyers must pay to sellers in settlement of the actual
deliveries, based on the delivery prices established by the Clearing House, and
adjusted for applicable interest payments. Such invoices shall be delivered to
the Clearing House by 2:00 p.m., or by such other time designated by the Board
of Directors, on the day of intention except on the last intention day of the
month, where such invoices shall be delivered to the Clearing House by 3:00
p.m., or by such other time designated by the Board of Directors. Upon receipt
of such invoices, the Clearing House shall promptly make them available to
buyers to whom they are addressed, by placing them in buyer's mail boxes
provided for that purpose in the Clearing House. (12/01/99)
1849.04 Payment - Payment shall be made in federal funds. The long obligated
to take delivery must take delivery and make payment before 1:00 p.m. on the day
of delivery except on banking holidays when delivery must be taken and payment
made before 9:30 a.m. the next banking business day. Adjustments for differences
between contract prices and delivery prices established by the Clearing House
shall be made with the Clearing House in accordance with its By-laws and
Resolutions. 3013 (10/01/94)
1849.05 Buyers Banking Notification - The long Clearing Member shall provide
the short Clearing Member by 4:00 p.m. (5:00 p.m. EST) on the day of intention,
one business day prior to delivery day, with a Banking Notification. The Banking
Notification form will include the following information: the identification
number and name of the long Clearing Member; the delivery date; the notification
number of the delivery assignment; the identification number and name of the
short Clearing Member making delivery; the quantity of the contract being
delivered; the long Clearing Member's bank, account number and specific Federal
Wire instructions for the transfer of U.S. securities. (10/01/94)
1850.00 Duties of Members - (See Rule 1050.00) (10/01/94)
1851.01 Office Deliveries Prohibited - (See Regulation 1051.01) (10/01/94)
1854.00 Failure to Accept Delivery - (See Rule 1054.00) (10/01/94)
Ch18 Regularity of Banks
1880.01 Banks - For purposes of these regulations relating to trading in long
term U.S. Treasury bonds, the word "Bank" (Regulation 1842.01) shall mean a U.S.
commercial bank (either Federal or State charter) that is a member of the
Federal Reserve System and with capital (capital, surplus and undivided
earnings) in excess of one hundred million dollars ($100,000,000). 3015
(10/01/94)
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Chapter 19
Long-Term Municipal Bond Index Futures
=======================================================================================================================
Ch19 Trading Conditions..............................................................................
1901.00 Authority........................................................................
1902.01 Application of Regulation........................................................
1904.01 Unit of Trading..................................................................
1905.01 Months Traded In.................................................................
1906.01 Price Basis......................................................................
1907.01 Hours of Trading.................................................................
1908.01 Trading Limits...................................................................
1909.01 Last Day of Trading..............................................................
1909.02 Liquidation During the Delivery Month............................................
1910.01 Margin Requirements..............................................................
1912.01 Position Limits and Reportable Positions.........................................
1913.01 All-Or-None Orders...............................................................
Ch19 Delivery Procedures.............................................................................
1936.01 Standards........................................................................
1942.01 Delivery on Futures Contracts....................................................
1947.01 Payment..........................................................................
1950.01 Index Composition................................................................
1950.02 Disclaimer.......................................................................
================================================================================
Chapter 19
Long-Term Municipal Bond Index Futures
================================================================================
Ch19 Trading Conditions
1901.00 Authority - (See Rule 1701.00) (10/01/94)
1902.01 Application of Regulation - Futures transactions in Long-Term
Municipal Bond Index contracts shall be subject to the general rules of the
Association as far as applicable and shall also be subject to the regulations
contained in this chapter, which are exclusively applicable to trading in Long-
Term Municipal Bond Index futures contracts. (10/01/94)
1904.01 Unit of Trading - The unit of trading shall be $1,000.00 times The
Bond Buyer Municipal Bond Index*. (10/01/94)
1905.01 Months Traded In - Trading in Long-Term Municipal Bond Index futures
may be scheduled in such months as determined by the Exchange. (09/01/99)
1906.01 Price Basis - The price of Long-Term Municipal Bond Index futures
shall be quoted in points. One point equals $1,000.00. The minimum price
fluctuation shall be 1/32 of one point or thirty-one dollars and twenty-five
cents ($31.25) per contract. Contracts shall not be made on any other price
basis. (10/01/94)
1907.01 Hours of Trading - The hours of trading for future delivery in Long-
Term Municipal Bond Index futures shall be determined by the Board. On the last
day of trading in an expiring future, the closing time for such future shall be
2:00 p.m. Chicago time (3:00 p.m. New York time) subject to the otherwise
applicable provisions of the second paragraph of Rule 1007.00. The market shall
be opened and closed for all months simultaneously or in such other manner as
the Regulatory Compliance Committee shall direct. (10/01/94)
1908.01 Trading Limits - (See Regulation 1008.01). (10/01/94)
1909.01 Last Day of Trading - No trades in Long-Term Municipal Bond Index
futures contracts deliverable in the current delivery month shall be made during
the last seven business days of that month. If on the last day of trading The
Bond Buyer does not publish a closing Bond Buyer Municipal Bond Index* value,
the last day of trading shall be the next business day for which a closing Bond
Buyer Municipal Bond Index* value is published. (10/01/94)
1909.02 Liquidation During the Delivery Month - After trading in contracts for
future delivery in the current delivery month has ceased, in accordance with
Regulation 1909.01 of this chapter, outstanding contracts for such delivery
shall be liquidated by cash settlement as prescribed in Regulation 1942.01.
(10/01/94)
1910.01 Margin Requirements - (See Regulation 431.03). (10/01/94)
1912.01 Position Limits and Reportable Positions - (See Regulation 425.01).
(10/01/94)
1913.01 All-Or-None Orders - The minimum threshold established for All-Or-None
orders in Long-Term Municipal Bond Index futures is one hundred contracts. Such
orders must be executed in accordance with Regulation 331.03. (07/01/00)
Ch19 Delivery Procedures
1936.01 Standards - The contract grade shall be $1,000.00 times the closing
value of The Bond Buyer Municipal Bond Index* on the last day of trading. The
Bond Buyer Municipal Bond Index* shall be that index which shall be composed and
determined by The Bond Buyer in accordance with the criteria set forth in
Regulation 1950.01 and which shall be known as The Bond Buyer Municipal Bond
Index*. The closing value of The Bond Buyer Municipal Bond Index* shall be
determined by The Bond Buyer. (10/01/94)
1942.01 Delivery on Futures Contracts - Delivery against Long-Term Municipal
Bond Index futures contracts shall be made through the Clearing House. Delivery
under these regulations shall be accomplished by cash settlement as hereinafter
provided.
After trading ceases on the last day of trading the Clearing House shall advise
clearing members holding open positions in current month Long-Term Municipal
Bond Index futures contracts of the closing value of The Bond Buyer Municipal
Bond Index* on the last day of trading. Clearing members shall make and receive
payment through the Clearing House in accordance with normal variation
settlement procedures. The settlement price on the last day of trading is equal
to $1,000.00 times the closing value of The Bond Buyer Municipal Bond Index* on
the last day of trading. (10/01/94)
1947.01 Payment - (See Regulation 1049.04) (10/01/94)
1950.01 Index Composition - The Bond Buyer Municipal Bond Index* (the "Index")
shall be constructed by The Bond Buyer in accordance with the following
criteria:
(a) General Index Composition-The Index, at all times, shall be composed
of 40 term municipal bonds that are generally exempt from federal
income taxation including those generally exempt issues whose interest
payments may be subject to an alternative minimum tax. The term bonds
selected shall be the most current issues which meet each of the
following criteria:
1. Size-Each term bond (term component only) shall have a principal
value of at least $50 million except for term housing bonds which
shall have a principal value of at least $75 million to be
eligible for inclusion in the Index.
2. Rating-Each term bond shall be rated by either Standard and
Poor's (S&P) or Moody's Investors Service (MIS) or both. Each
term bond shall be rated either A- or higher by S&P, or A or
higher by MIS (A3 or higher for bonds rated by MIS using the 1-3
suffix) upon initial inclusion in the Index.
3. Maturity-Each term bond shall have a remaining maturity of 19
years or longer on the date of a bond's initial inclusion in the
Index.
4. Call Provisions-Each term bond may or may not be callable. If
callable, the first call shall be between 7 and 16 years upon a
bond's initial inclusion in the Index. In addition, each callable
term bond must have at least one call-at-par date prior to
maturity.
5. Par Issue-Each term bond must have been reoffered at a price
between 85 and 105 to be eligible for inclusion in the Index.
6. Trading Eligibility-Each term bond shall be reoffered, out of
syndicate, and eligible for dealer-to-dealer broker trading at
least one business day prior to inclusion in the Index, provided
that The Bond Buyer can gather the information necessary to make
a determination to include such bond by such time.
7. Private Placements-A term bond issued as a private placement is
not eligible for inclusion in the Index.
8. Coupon-Each term bond shall pay semiannual interest at a fixed
coupon rate.
9. Term Bond Limit-No more than two term bonds from the same issuer
shall be included in the Index. If more than two term bonds from
the same issuer are available for inclusion in the Index, the two
largest term bonds in terms of principal value shall be added. If
two or more term bonds are the same size, the term bonds with the
longest maturity shall be added to the Index.
Ch19 Delivery Procedures
------------------------
A bond shall be deemed to have been issued by the same issuer if
such bond has the same nominal and generic security, that is, the
same ultimate source of payment for debt service, of another bond
in the Index. A first or second lien bond of the same generic
security shall be defined as having been issued by the same
issuer.
The Bond Buyer shall determine which bonds meet the above listed
inclusion criteria. The Bond Buyer, in its discretion, may
exclude term bonds which meet the above listed criteria but which
have other unusual characteristics. Such characteristics may
include, but shall not be limited to, bonds with unusual tender
provisions, early redemption options, or contingent takedown
options.
(b) Index Computation-The Bond Buyer shall compute the closing value of the
Index each day the municipal bond cash market is open using the
following procedures:
1. Price Evaluation-At least four major municipal bond dealer-to-
dealer brokers, who broker the type and variety of bonds fully
representative of this Index shall evaluate the price of each
bond in the Index daily. An evaluation shall be defined as the
broker's assessment of the price at which a minimum $100,000 or
higher face value of each of such bonds could be sold in the cash
market between 1:45 p.m. and 2:00 p.m. Chicago time (2:45 p.m.
and 3:00 p.m. New York time). Beginning on the first business day
of the delivery month and continuing through the day the current
contract expires, the brokers shall also evaluate the price of
each bond between 10:45 a.m. and 11:00 a.m. Chicago time (11:45
a.m. and 12:00 noon New York time), in order that The Bond Buyer
may compute the Index twice daily. If the Secretary of the
Exchange determines in advance that circumstances in the cash
market will occasion either an early halt to cash market trading
or an otherwise unscheduled holiday which would impede a price
evaluation, the Secretary may suspend or reschedule the price
evaluation(s) for that day provided that such determination is
published before the start of trading on the day in question and
provided that such day is not the last day of trading in a
contract month. In the event that circumstances prevent at least
four major municipal bond dealer-to-dealer brokers from pricing
each of the bonds in the index, the Secretary of the Exchange may
allow, without prior notice, the price evaluation for that day to
be calculated with less than four major municipal bond dealer-to-
dealer brokers or may suspend or revise the day's calculation,
provided that the day in question is not the last day of trading
in a contract month.
2. Computation-The Bond Buyer shall compute the median value for
each bond. The median value is defined as the price arrived at by
dropping the one highest and the one lowest price evaluations and
calculating the simple average (mean) of the remaining price
evaluations. Each median value shall be divided by a conversion
factor to arrive at a converted price. The 40 converted prices
shall be summed and divided by 40 to arrive at the average
converted price. The average converted price shall be divided by
a divisor or multiplied by a coefficient (see subsection (d)
below) and rounded to the nearest 1/32 (rounded up if the Index
value is exactly at the midpoint between two 1/32s) to arrive at
the daily Index value.
3. Conversion Factor-The conversion factor for any bond shall be the
price at which it will yield 6% (rounded to 4 decimal places)
based on the formula found in Standard Securities Calculation
Methods published by the Securities Industry Association. The
coupon is the actual bond coupon rounded to the nearest 1/8%
(rounded up in the case of ties). The time to maturity is
calculated in complete three month increments from the first
business day of the quarter following the bond's reoffer date to
the first call-at-par date for callable bonds and to the maturity
date for non-callable bonds. The conversion factor for each bond
shall be published in The Bond Buyer.
(c) Composition Changes-After 2:00 p.m. Chicago time (3:00 p.m. New
York time) on the 15th calendar day and on the last business day
of each month (the "revision days") the Index shall be revised by
adding bonds to and deleting bonds from the Index as provided
below. If the 15th calendar day of any month is not an
Association business day, the Index revision shall occur after
2:00 p.m. Chicago time (3:00 p.m. New York time) on the
immediately preceding Association business day.
Ch19 Delivery Procedures
------------------------
Bonds shall be added to and deleted from the Index in the following
manner:
1. (i) Any bond that includes a provision for extraordinary
redemption in the Official Statement, and that is priced at
102 or higher on both of the two business days immediately
preceding the revision day shall be deleted. An
extraordinary redemption shall be defined as a provision
which permits the issuer to call (redeem) the bond, in whole
or in part, at a price of par (100) as a result of: (a)
prepayments; (b) uncommitted or unexpended bond proceeds; or
(c) other funds available in excess of the amounts required
for the payment of debt service and expenses.
(ii) Any bond which no longer meets the minimum rating criterion
listed in 1950.01(a)(2) shall be deleted. Any bond in
default shall be deleted from the Index.
2. Newly issued bonds meeting the criteria listed in subsection (a)
above shall be added.
(i) In order to be included in the revised Index, bonds must be
reoffered, out of syndicate, and eligible for dealer-to-
dealer broker trading at least one business day prior to
inclusion in the Index.
(ii) In the event that a newly issued term bond meets the
criteria, but would cause the total number of term bonds
from a single issuer to exceed two, the term bond of that
issuer previously in the Index which has the lowest trading
volume since the previous revision day shall be deleted from
the Index until the total number of term bonds does not
exceed two. Trading volume shall be based on the dealer-to-
dealer trades matched by the National Securities Clearing
Corporation. Volume data supplied by the National Securities
Clearing Corporation will be cumulative data covering the
last revision period. Only bonds for which trading data can
be collected for the entire previous revision period will be
eligible for deletion under the foregoing trading volume
criterion. If bonds of that issuer have equal trading
volume, or are bonds for which trading data cannot be
collected for the entire previous revision period, and are
eligible for deletion, the bond which has been in the Index
for the longest period of time shall be deleted first. If
the bonds of that issuer have equal trading volume, or are
bonds for which trading data cannot be collected for the
entire previous revision period, and are of equal age and
are eligible for deletion, the smallest bonds of that issuer
in terms of principal value shall be deleted first. If bonds
of that issuer have equal trading volume, or are bonds for
which trading data cannot be collected for the entire
previous revision period, and are of equal age and the same
size in terms of principal value, and are also eligible for
deletion, the bonds with the shortest maturity shall be
deleted first.
3. (i) If the Index contains more than 40 bonds, bonds that have
been in the Index for 18 months or longer shall be deleted
until the number of bonds in the Index equals 40. If bonds
are of equal age, the smallest bonds in terms of principal
value shall be deleted first. If bonds are of equal age and
are the same size in terms of principal value, the bonds
with the shortest maturity shall be deleted first. If the
Index still contains more than 40 bonds, the bonds
previously in the Index with the lowest trading volume since
the previous revision day shall be deleted until the number
of bonds in the Index equals 40. Trading volume shall be
based on the dealer-to-dealer trades matched by the National
Securities Clearing Corporation. Volume data supplied by the
National Securities Clearing corporation will be cumulative
data covering the last revision period. Only bonds for which
trading data can be collected for the entire previous
revision period will be eligible for deletion under the
foregoing trading volume criterion. If bonds have equal
trading volume, the bonds that have been in the Index for
the longest period of time shall be deleted first.
If bonds have equal trading volume and are of equal age the
smallest bonds in terms of principal value shall be deleted
first. For bonds which are equivalent on all three criteria
the bonds with the shortest maturity shall be deleted first.
Under extraordinary circumstances The Bond Buyer, in its
discretion, may choose to delete bonds other than the bonds
with the lowest trading volume. Such
Ch19 Delivery Procedures
------------------------
circumstances may include, but shall not be limited to,
extraordinary redemptions and prerefundings.
(ii) If the Index contains less than 40 bonds, previously deleted
bonds shall be added beginning with the most recently
deleted bond until the number of bonds in the Index equals
40. If bonds are of equal age, the largest bonds in terms of
principal value shall be added first. If bonds are of equal
age and are the same size in terms of principal value, the
bonds with the longest maturity shall be added first. Bonds
priced at 102 or above and which are subject to an
extraordinary redemption provision (see subsection (c)(1)
above) shall not be added to the Index.
On the business day preceding the revision day, the bonds to
be added to the Index and the bonds to be deleted from the
Index shall be announced by The Bond Buyer.
(d) Divisor (Coefficient) Computation and Changes-As of December 12, 1983,
the Index divisor (coefficient) shall equal one. The Index divisor
(coefficient) shall be changed each time the Index is revised. On each
revision day, a new divisor (coefficient) shall be chosen such that
the closing level of the revised Index shall equal the closing level
of the Index had it not been revised. The divisor is defined as the
number arrived at by dividing the average converted price (see
1950.01(b)(2)) for the bonds in the revised ("new") Index by the value
of unrevised ("old") Index on revision day. The coefficient is defined
as the reciprocal of the divisor. The divisor (coefficient) is rounded
to four decimal places. The Index divisor (coefficient) shall be reset
to one, on March 1, 1995. The index divisor (coefficient) applicable
to Municipal Bond Index futures contracts based on 6 percent
conversion factors shall be reset when the 6 percent contract(s) is
(are) first listed.
*Copyright 1985, The Bond Buyer and The Board of Trade of the City of
Chicago. (03/01/00)
1950.02 Disclaimer - The Bond Buyer Municipal Bond Index futures and
futures options are not sponsored, endorsed, sold or promoted by Thomson
Holdings, Inc., its subsidiaries, The CBBB Partnership, or the various brokers
who evaluate bonds for purposes of the Index ("Entities"). These Entities make
no representation or warranty, express or implied, to the owners of Bond Buyer
Municipal Bond Index futures or futures options or any member of the public
regarding the advisability of trading in Bond Buyer Municipal Bond Index futures
and futures options. These Entities have no obligation to take the needs of the
Chicago Board of Trade or the owners of the Bond Buyer Municipal Bond Index
futures and futures options into consideration in determining, composing or
calculating the Index. These Entities are not responsible for and have not
participated in the determination of when the Bond Buyer Municipal Bond Index
futures and futures options are listed for trading and (in the case of futures
options) at what strike prices or in the determination or calculation of how
such Index futures and futures options may be converted into cash. These
Entities have no obligation or liability in connection with the administration,
marketing or trading of the Bond Buyer Municipal Bond Index futures and futures
options.
THESE ENTITIES DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE BOND
BUYER MUNICIPAL BOND INDEX OR ANY DATA INCLUDED THEREIN AND SHALL HAVE NO
LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. THESE ENTITIES
MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE
CHICAGO BOARD OF TRADE, OWNERS OF THE BOND BUYER MUNICIPAL BOND INDEX FUTURES
AND FUTURES OPTIONS, OR ANY OTHER PERSON OR ENTITY, FROM THE USE OF SUCH INDEX
OR ANY DATA INCLUDED THEREIN. THESE ENTITIES MAKE NO EXPRESS OR IMPLIED
WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE BOND BUYER MUNICIPAL BOND
INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO
EVENT SHALL THESE ENTITIES HAVE ANY LIABILITY FOR LOST PROFITS OR INDIRECT,
PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF
NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO THIRD PARTY
BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN THESE ENTITIES AND
BETWEEN THESE ENTITIES AND THE CHICAGO BOARD OF TRADE OR THE CBBB PARTNERSHIP.
(04/01/98)
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Chapter 20
Futures Commission Merchant
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Ch20 General.....................................................................................
2000.00 Commission Merchant..........................................................
2001.00 Corporations and Partnerships................................................
2001.01 Partnerships and Corporations................................................
2001.02 Registration of Membership for Corporation...................................
2001.03 Registration of Membership for Partnership...................................
2002.00 Business Conduct Committee...................................................
2003.00 Testimony and Production of Books and Papers.................................
2003.01 Approval of Customer Accounts................................................
2003.02 Financial Questionnaire......................................................
2003.03 Audits.......................................................................
2003.04 Reduction of Capital.........................................................
2003.05 Restrictions on Operations...................................................
2003.07 Financial Requirements.......................................................
2003.08 Expulsion from a Designated Contract Market..................................
2004.00 Advertising..................................................................
2005.00 Trade Checking Penalties.....................................................
Ch4 Customer Accounts............................................................................
414.00 Trades of Non-Clearing Members...............................................
415.00 Trades of Non-Clearing Members...............................................
416.01 Correspondent Accounts.......................................................
416.02 Members Responsible for Correspondents.......................................
416.02A Correspondents...............................................................
416.04 Correspondent Accounts.......................................................
416.05 Limitations On Acceptance of Agent Business..................................
417.01 Notice and Processing of Transfer of Accounts................................
418.01 Non-Members' Accounts........................................................
419.00 Trading for Employees........................................................
420.00 Trading by Employees.........................................................
420.01 Gratuities...................................................................
420.01A Elective Officers and Non-Member Directors...................................
421.00 Confirmation to Customers....................................................
421.01 Confirmations................................................................
421.02 Options Confirmations........................................................
421.03 Average Price Orders.........................................................
421.05 Allocation of Exercise Notices...............................................
422.00 Investment Company Accounts..................................................
423.00 Discretionary Orders.........................................................
423.01 Discretionary Accounts.......................................................
423.01B Discretionary Trading........................................................
423.02 Presumption That Trades Are Pursuant to Discretionary Authority..............
423.03 Supervision of Discretionary Trading by Employees............................
423.04 Customer Orders During Concurrent Sessions...................................
Ch4 Position Limits and Reportable Positions in Futures..........................................
425.01 Position Limits In Futures...................................................
425.02 Bona Fide Hedging Positions in Futures.......................................
425.03 Reporting Requirements For Bona Fide Hedging Positions in Futures in
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Excess of Limits...............................................................
425.04 Exemptions From Position Limits in Futures.....................................
425.05 Exemption from Aggregation for Position Limit Purposes in Futures..............
425.06 Position Accountability for U.S. Treasury Bond Futures.........................
425.07 Position Accountability for Long-Term and Medium-Term Treasury Note
Futures........................................................................
425.08 Position Accountability for 30-Day Fed Funds Futures...........................
430.00 Deposits by Customers..........................................................
431.00 Margins........................................................................
431.00A Permit Holder Interpretation...................................................
431.01 Margins - Non-Clearing Members.................................................
431.02 Margin Requirements............................................................
431.02A Hedging Transactions...........................................................
431.03 Margin on Futures..............................................................
431.03A Margins........................................................................
431.03B Margins........................................................................
431.04 Notice of Undermargined Omnibus Accounts.......................................
431.05 Margin on Options..............................................................
431.06 Margin on Options - Non-Clearing Members.......................................
432.00 Customers' Securities..........................................................
433.00 Agreement for Use of Securities................................................
433.01 Construction of Rules 432.00 and 433.00........................................
Ch4 Transfer Trades/Exchange Service Fees......................................................
443.00 Exempt Transactions............................................................
444.01 Transfer Trades; Exchange of Futures for Physicals and Give-up
Transactions...................................................................
444.01A Transfer Trades and Inter-Market Spreads.......................................
444.01B Prohibition on Exchange of Futures for Cash Commodities Involving
Multi-Parties..................................................................
444.02 Clearance of Exchanges of Futures for Physicals Transactions...................
444.03 Transfer Trades in a Delivery Month............................................
450.00 Exchange Service Fees..........................................................
450.01 Exchange Service Fees..........................................................
450.01A Exchange Service Fees..........................................................
450.01B Options Transactions...........................................................
450.01C Exchange Service Fees..........................................................
450.02 Member's Own Account and Member Firm's Account.................................
450.03 Exchange Service Fees for Professional Trading Firms...........................
450.04 Exchange Service Fees - Adjustments............................................
Ch4 Adjustments................................................................................
460.01 Errors and Mishandling of Orders...............................................
460.02 Checking and Reporting Trades..................................................
460.03 Failure to Check Trades........................................................
460.04 Price of Execution Binding.....................................................
Ch4 Customer Orders............................................................................
465.01 Records of Customers' Orders...................................................
465.02 Application and Closing Out of Offsetting Long and Short Positions.............
465.02A Exchange's No Position Stance on FCM's Internal Bookkeeping Procedures.........
465.03 Orders and Cancellations Accepted On A 'Not Held' Basis........................
465.04 Records of Floor Order Forms...................................................
465.05 Floor Order Forms..............................................................
465.06 Broker's Copy of Floor Orders..................................................
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465.07 Designation of Order Number Sequences..........................................
465.08 Post-Execution Allocation......................................................
466.00 Orders Must be Executed in the Public Market...................................
Ch4 Offices and Branch Offices.................................................................
475.00 Offices and Branch Offices.....................................................
Ch4 APs and Other Employees....................................................................
480.01 APs............................................................................
480.02 Employers Responsible for APs..................................................
480.09 Other Employees................................................................
480.10 Supervision....................................................................
Ch4 Options Transactions.......................................................................
490.00 Application of Rules and Regulations...........................................
490.02 Option Customer Complaints.....................................................
490.03 Supervision Procedures.........................................................
490.03A Introducing Brokers Guaranteed by Member FCMs/Supervision Procedures...........
490.05 Disclosure.....................................................................
490.06 Promotional Material...........................................................
490.07 Sales Communication............................................................
490.09 Reports by Commission Merchants................................................
495.01 Position Limits in Options.....................................................
495.02 Economically Appropriate Hedging Positions in Options..........................
495.03 Reporting Requirements for Economically Appropriate Hedging Positions in
Options in Excess of Limits....................................................
495.04 Exemptions From Position Limits in Options.....................................
495.06 Position Accountability for U.S. Treasury Bond Futures Options.................
495.07 Position Accountability for Long-Term and Medium Term Treasury Note
Futures Options................................................................
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Chapter 20
Futures Commission Merchant
================================================================================
Ch4 General
2000.00 Commission Merchant - A member who makes a trade, either for another
member or for a non-member, but who makes the trade in his own name and becomes
liable as principal as between himself and the other party to the trade. 13
(08/01/94)
2001.00 Corporations and Partnerships - (See 230.00) (08/01/94)
2001.01 Partnerships and Corporations - Trading Authority-(See 230.01)
(08/01/94)
2001.02 Registration of Membership for Corporation - (See 230.02) (08/01/94)
2001.03 Registration of Membership for Partnership - (See 230.06) (08/01/94)
2002.00 Business Conduct Committee - (See 542.00) (08/01/94)
2003.00 Testimony and Production of Books and Papers - (See 545.00)
(08/01/94)
2003.01 Approval of Customer Accounts - No firm or any of its wholly-owned
affiliates shall carry customer accounts without prior approval obtained either
at the time of registration under Regulation 230.02 or 230.06 or prior to change
in the nature of business previously authorized. In order to originate and carry
on a business with public customers, a firm is subject to the minimum capital
requirements established by the Financial Compliance Committee.
No member sole proprietorship shall carry customer accounts without prior
approval . A member requesting approval to carry customer accounts shall submit
a certified financial report of the sole proprietorship, prepared by an
independent Certified Public Accountant as of a date which is no more than 90
days prior to the date of submission. In order to originate and carry on a
business with public customers, a sole proprietorship is subject to the minimum
capital requirements established by the Financial Compliance Committee. 1780
(08/01/94)
2003.02 Financial Questionnaire - (See 285.01) (08/01/94)
2003.03 Audits - (See 285.02) (08/01/94)
2003.04 Reduction of Capital - (See 285.03) (08/01/94)
2003.05 Restrictions on Operations - (See 285.04) (08/01/94)
2003.07 Financial Requirements - (See 285.05) (04/01/97)
2003.08 Expulsion from a Designated Contract Market - Upon review of the
decision or record which resulted in a person or a firm's expulsion from
membership in, or the privileges of membership on, any recognized domestic or
foreign board of trade or securities exchange, should the Board of Directors
find that there exists a demonstrable connection between the type of conduct
which resulted in the expulsion and the protection afforded the Exchange, its
members and customers through a trading prohibition against the expelled
individual or firm, the Board may direct that no member or member firm may carry
any account, accept an order, or handle a transaction, relating to futures
contracts or options on futures contracts traded on the Exchange, for or on
behalf of such expelled person or firm. Such an order may by modified or revoked
by a vote of two-thirds of the Directors. (08/01/94)
2004.00 Advertising - (See 287.00) (08/01/94)
2005.00 Trade Checking Penalties - (See 563.00) (08/01/94)
Ch4 Customer Accounts
414.00 Trades of Non-Clearing Members - (See 286.00) and (See 431.00)
(08/01/94)
415.00 Trades of Non-Clearing Members - (See 333.00) (08/01/94)
416.01 Correspondent Accounts - Each registered eligible business
organization must maintain a complete listing of all correspondent accounts
carried on its books. Such list shall be promptly provided to authorized
representatives of the Association. Information for each correspondent account
must include name and address, classification of the account as customer or
house, regulated or non-regulated. 1780A (04/01/98)
416.02 Members Responsible for Correspondents - Members doing business with
correspondents must keep themselves well informed regarding their financial
standing and shall immediately report to the Secretary any information that does
in any way indicate that a correspondent is insolvent, or threatened with
insolvency, or guilty of any irregularities or practices affecting the good name
of the Association. 1043 (08/01/94)
416.02A Correspondents - In May, 1935, the Rules Committee ruled that the word
"correspondents" as it is used in Regulation 416.02 means the following:
1. A correspondent, under the provisions of Regulation 170.07 is a person,
firm or corporation (member or non-member) transacting a banking or a
brokerage business connected by telephone or telegraphic wire or wireless
connection with the office of a member.
2. A non-clearing member who solicits and turns over security or future
delivery orders to a clearing member for execution, is a correspondent of
the clearing member whether or not his office is connected by telephonic,
telegraphic wire connections to that of the clearing member.
3. Under the provisions of Regulation 416.02, any member doing business with
correspondents has the responsibilities therein outlined. 17R (08/01/94)
416.04 Correspondent Accounts - Consistent with its duties under Rule 542.00,
the Business Conduct Committee may require that the identities and positions of
the beneficial owners of any correspondent account be immediately disclosed to
the Business Conduct Committee or to authorized representatives of the
Association. If disclosure is not provided and the Business Conduct Committee
determines that such failure to provide information is an impediment to the
Committee in the discharge of its duties under Rule 542.00, appropriate summary
action may be ordered up to and including immediate liquidation of all or a
portion of the positions in the correspondent account. Any such summary action
shall be taken in accordance with the procedures set forth in Regulation
5200.06. (08/01/94)
416.05 Limitations On Acceptance of Agent Business - No member FCM shall
solicit or accept any options order for execution on the Exchange which has been
solicited, accepted or serviced by any person who is not registered as an
associated person of such member FCM. Provided, however, that at such time as
any futures association registered under Section 17 of the Commodity Exchange
Act has determined to provide for the regulation of the options-related activity
of its members in a manner equivalent to that required of contract markets by
the Commission, any FCM member of such futures association may solicit or accept
options orders for execution on the Exchange in the same manner as FCMs which
are members of the Exchange.
Further, no member FCM may solicit or accept options orders from any person whom
it has reason to believe may be soliciting options orders in contravention of
this Regulation or Regulation 33.3 or the Commission. (08/01/94)
417.01 Notice and Processing of Transfer of Accounts - When a commission
merchant goes out of business, or closes one or more offices, or withdraws
ordinary facilities for transacting business from one or more offices, the
following shall apply:
Upon the transfer of customer accounts in commodity futures contracts by a
member or registered eligible
Ch4 Customer Accounts
---------------------
business organization, to any other futures commission merchant (member or non-
member), the transferor shall immediately give written notice of the transfer to
the Secretary of the Association. Such written shall notice shall contain: (1)
the name and address of the transferee; (2) the date of the transfer; (3) the
number of customer accounts; (4) the net equity of customer funds, and (5) a
statement certified by the member, or by a general partner or executive officer
whose membership is registered for the transferor, that (a) the transferor has
provided prior notice of the transfer to each customer whose account is thus
transferred and (b) the transfer has been preceded by reasonable investigation
of the transferee by the transferor and that the transferee is a suitable
recipient of the transferred accounts.
Upon the transfer of customer accounts by a non-member of the Association, to
any member or registered eligible business organization, the transferee shall
immediately notify the Secretary in writing that such transfer has occurred and
such written notice shall identify the transferor, the date of transfer, the
number of customer accounts, and the net equity of customer funds being
transferred to such member or registered eligible business organization.
A member or registered eligible business organization, acting as a transferor or
transferee, must be able to facilitate a bulk transfer of accounts by use of an
automated system as prescribed by the Association.
This regulation applies to all transfers of customer accounts involving members
or registered eligible business organizations, who or which are closing
facilities unless they are initiated at the unsolicited request of the
customers. 1809C (04/01/98)
418.01 Non-Members' Accounts - When a non-clearing member has trading
authority over a non-members account carried on a disclosed basis he shall so
inform the clearing member carrying the account.
Non-clearing members may be permitted to carry both omnibus and disclosed
accounts with clearing members provided that when the non-clearing member used
both types of accounts, he shall guarantee the clearing member carrying any
disclosed accounts against any loss in such accounts.
The non-clearing member must notify the carrying member that he is carrying both
omnibus and disclosed accounts. 1819 (08/01/94)
419.00 Trading for Employees - No member shall accept orders or clear trades
for a non-member who is employed by another member nor shall another member
accept orders or clear trades for a member who is employed by another member
when the name of the employer appears in the transaction. 205 (08/01/94)
420.00 Trading by Employees - No member shall accept marginal accounts of any
employee, whether member or non-member, of the Association or of the Clearing
House or of another member unless written consent of the employer be first
obtained. 206 (08/01/94)
420.01 Gratuities - (See 206.02) (08/01/94)
420.01A Elective Officers and Non-Member Directors - For purposes of Rule
420.00, Elective Officers and non-member Directors of the Association shall not
be considered employees of the Association. (08/01/94)
421.00 Confirmation to Customers - A commission merchant who makes a trade
for a member or non-member customer shall confirm the trade to the customer no
later than the business day following the day upon which the transaction was
consummated. Such confirmation shall be in writing and shall show the commodity
or security bought or sold, the amount, the price, and the name of the other
party to the contract, and, in the case of a commodity, the delivery month. A
non-resident member may give to his customer the name of his resident commission
merchant in lieu of the name of the other party to the contract, subject to the
right of the customer to receive the name of the other party to the contract
upon request.
Where a trade is made by a branch office of a resident member, such branch
office being outside of Illinois, the branch office may confirm the trade to the
customer without giving the name of the other party to the contract, provided
the confirmation has prominently printed or stamped thereon the words, "Name
Ch4 Customer Accounts
---------------------
of other party to contract furnished on request." 207 (08/01/94)
421.01 Confirmations - A confirmation of a commission merchant to the
customer need not contain the name of the other party to the contract, provided
the confirmation has prominently printed or stamped thereon the words, "name of
other party to contract furnished on request." 1845 (08/01/94)
421.02 Options Confirmations -
(a) A commission merchant who makes an options trade for a member or non-member
customer shall confirm the trade to the customer no later than the business
day following the day upon which the transaction was consummated. Such
confirmation shall be in writing and shall indicate the customer's account
identification number; a separate listing of the amount of the premium and
all other commissions, costs and fees; the option series; the expiration
date; and the date of the transaction.
(b) In addition, upon the expiration or exercise of any commodity option, each
commission merchant must furnish to each customer holding any such option
which has expired or been exercised, not later than the next business day,
a written confirmation statement which shall include the date of such
occurrence, a description of the option involved, and in the case of
exercise, the details of the futures position which resulted therefrom.
(c) Notwithstanding paragraphs (a) and (b) of this Regulation, a commodity
options transaction that is executed for a commodity pool (investment
company) need be confirmed only to the operator of the commodity pool.
(d) With respect to any account controlled by any person other than the
customer for whom the account is carried, each commission merchant shall
promptly furnish in writing to such other person the information set forth
in paragraphs (a) and (b) of this Regulation. (08/01/94)
421.03 Average Price Orders - Member firms may confirm to customers an
average price when multiple execution prices are received on an order or series
of orders for futures, options or combination transactions. An order or series
of orders executed during a trading session at more than one price may only be
averaged pursuant to this regulation if each order is for the same account or
group of accounts and for the same commodity and month for futures, or for the
same commodity, month, put/call and strike for options.
Any member or member firm that accepts an order pursuant to this regulation must
comply with requirements of this regulation and all order recordation
requirements.
Upon receipt of an execution at multiple prices for the order subject to this
regulation, an average price will be computed by multiplying the execution
prices by the quantities at those prices divided by the total quantities. An
average price for a series of orders will be computed based on the average
prices of each order in that series.
Each Clearing firm that confirms to a customer an average price, must indicate
on the confirmation and monthly statement that the price is not an execution
price. (04/01/00)
421.05 Allocation of Exercise Notices - The Clearing House, in an equitable,
random manner, shall assign exercise notices tendered by options purchasers to
clearing members holding open short options positions; and each clearing member
and commission merchant, in an equitable, random or proportional manner, shall
assign exercise notices it receives on behalf of customer accounts to such
customer accounts holding open short options positions. (08/01/94)
422.00 Investment Company Accounts - (See 507.00) (08/01/94)
423.00 Discretionary Orders - No member or registered eligible business
organization shall permit any employee, whether member or non-member, to
exercise discretion in the handling of any transaction for a customer for
execution on this Exchange, unless prior written authorization for the exercise
of such discretion has been received. A discretionary order is defined as an
order that lacks any of the following elements: the commodity, year and delivery
month of the contract, number of contracts, and whether the order is to buy or
sell.
Ch4 Customer Accounts
---------------------
All partners of a registered partnership, all managers and members of a
registered limited liability company and all officers of a registered
corporation, shall be considered employees of their firm or corporation for
purposes of these discretionary rules and regulations. 151 (04/01/98)
423.01 Discretionary Accounts - It shall be a violation of this regulation
for any member or registered eligible business organization
1. To accept or carry an account over which the member or employee thereof
exercises trading authority or control for another person in whose name the
account is carried, without-
a. obtaining a signed copy of the Power of Attorney, trading
authorization, or other document by which such trading authority or
control is given;
b. sending direct to the person in whose name the account is carried a
written confirmation of each trade as provided in Rule 421.00 and a
monthly statement showing the exact position of the account, including
all open trades figured to the market; and
c. reflecting the discretionary nature of the account on all statements
sent to the account owner.
2. To accept or carry an account over which any third party individual or
organization other than the person in whose name the account is carried
exercises trading authority or control, without-
a. obtaining a signed copy of the Power of Attorney, trading
authorization, or other document by which such trading authority or
control is given; and
b. obtaining a written acknowledgment from the person in whose name the
account is carried that he has received a copy of the account
controller's disclosure document, prepared pursuant to CFTC Regulation
4.31, or a written statement explaining why the account controller is
not required to provide a disclosure document to the customer.
(The above acknowledgement of paragraph b. need not be obtained (i) when
the person in whose name the account is carried and the individual given
trading authority or control are of the same family; or (ii) when the
person given trading authority or control is (A) a member, (B) an officer,
partner, member, manager or managerial employee of the eligible business
organization carrying the account; (C) a bank or trust company organized
under federal or state laws or (D) an insurance company regulated under the
laws of any state; or (iii) when the account is carried in the name of (A)
an employee benefit plan subject to ERISA or organized under the laws of
any state (B) an investment company registered under the Investment Company
Act of 19200, (C) a bank or trust company organized under federal or state
law, (D) an insurance company regulated under the laws of any state; or (E)
an exempt organization, as defined in section 501 (c) (3) of the Internal
Revenue Code, with net assets of more than $100 million.)
3. To accept or carry the account of a non-member who has given trading
authority to a member unless the member carrying the account requires that
all orders entered for the account be executed by an individual or
individuals other than the member to whom such trading authority is given.
This requirement shall not apply where the non-member customer and the
member having such trading authority are of the same family. This
Regulation shall only apply to open outcry Regular and open outcry Night
Trading Hours.
4. For purposes of this Regulation, a person does not exercise trading
authority or control if the person in whose name the account is carried or
the account controller specifies (1) the precise commodity interest to be
purchased or sold, and (2) the exact amount of the commodity interest to be
purchased or sold. Provided the foregoing provisions are met, the
provisions of this Regulation shall not apply to discretion as to the price
at which or the time when an order shall be executed.
The provisions of this Regulation relate only to transactions executed on this
Exchange. 1990 (04/01/98)
423.01B Discretionary Trading - The increasing utilization of trading by
programmed recommendations, whether by computer, charts or by any means, has
brought several questions to the Rules Committee regarding discretion. These
methods tend to create situations requiring the use of discretion and the Rules
Committee recommends that member firms treat all such accounts as discretionary
accounts unless the member can be certain that the customer(s) has given
specific
Ch4 Customer Accounts
---------------------
instructions, including price limits and any subsequent price changes relative
to orders placed in connection with such trading.
In connection with the above, your attention is called to Rule 423.00 and
Regulations 423.01 through 423.03 all having to do with the handling of
discretionary accounts. 41R (08/01/94)
423.02 Presumption That Trades Are Pursuant to Discretionary Authority -Every
trade in an account over which any individual or organization other than the
person in whose name the account is carried exercises trading authority or
control shall be rebuttably presumed to have been made pursuant to such trading
authority or control. The Power of Attorney, trading authorization or other
document by which any individual or organization other than the person in whose
name an account is carried exercises trading authority or control over such
account can be terminated only by a written revocation signed by the person in
whose name the account is carried; by the death of the person in whose name the
account is carried; or, where the individual or organization that exercises
authority or control over the account is the member carrying the account or an
employee thereof, by written notification from the member to the person in whose
name the account is held that such member will no longer act pursuant to such
trading authorization as of the date provided in the notice. 1991 (08/01/94)
423.03 Supervision of Discretionary Trading by Employees - A Power of
Attorney or trading authorization signed by the customer and naming the employee
to whom trading authority is given will be considered written authorization of
the customer with respect to any discretionary transaction handled by such
employee pursuant to such Power of Attorney or trading authorization.
Each account with respect to which an employee has discretionary authority must
be given daily supervision by the employer, or by a partner or officer or such
other person designated as a compliance officer if the employer is an eligible
business organization, to see that trading in such account is not excessive in
size or frequency in relation to financial resources in that account. The
provisions of this paragraph shall not apply where only one employee of an
eligible business organization member firm has discretionary authority if that
individual is also the only principal who supervises futures trading activity.
No employee who has not been registered for a minimum of two continuous years as
an Associated Person (AP) under CFTC Regulations may exercise the discretion
permitted by Rule 423.00. The foregoing requirement may be waived in particular
cases by the Business Conduct Committee upon a showing by the applicant of
experience equivalent to such a two-year registration. 1992 (04/01/98)
423.04 Customer Orders During Concurrent Sessions - For orders involving
concurrently traded contracts, the customer will designate whether the order is
to be executed in the open outcry market or on Project A. In the absence of such
customer designation, the order will be directed to the open outcry market.
(10/01/98)
Ch4 Position Limits and Reportable Positions in Futures
425.01 Position Limits In Futures -
(a) Except as provided in Regulations 425.03 and 425.04, the maximum net long
or net short positions which any person may own, control, except as
provided in Regulation 425.05, or carry are as follows: (Note: Position
limits and reportable positions are in number of contracts.)
[Enlarge/Download Table]
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Position Limit
Spot Month Limit Effective at Net Long or Position Limit
Start of Trading on First Net Short In Net Long or Net Reportable
Contract Business Day Prior to the First Any One Month Short in All Position in Any
Trading Day of the Spot Month Other than the Months Combined One Month
Spot Month
-----------------------------------------------------------------------------------------------------------------------------
CBOT. Dow Jones Industrial None None 50,000 25
Average(SM) Index
CBOT. Dow Jones Transportation None None 2,800 25
Average(SM) Index
CBOT. Dow Jones Utility None None 4,000 25
Average(SM) Index
CBOT. Dow Jones Composite None None 70,000 25
Average(SM) Index
1,000 oz. Silver 5,000 None 20,000 500
(see #1) (see #1)
5,000 oz. Silver 1,000 None 4,000 100
(see #1) (see #1)
Kilo Gold 6,000 None 12,000 200
(see #2) (see #2)
100 oz. Gold 2,000 None 4,000 200
(see #2) (see #2)
U.S. Treasury Bonds None None None 500
U.S. Treasury Notes (5 Yr.) None None None 300
U.S. Treasury Notes (6 1/2-10 None None None 500
Yr.)
U.S. Treasury Notes (2 Yr.) 5,000 None 5,000 200
Long Term Agency Notes 5,000 None 5,000 100
30-Day Fed Fund None None None 100
Long Term Municipal Bond Index None None 5,000 100
(see #7)
Corn 600 5,500 9,000 150
(see #3) (see #3)
Soybeans 600 3,500 5,500 100
(see #3) (see #3)
Wheat 600 3,000 4,000 100
(see #6) (see #3) (see #3)
Oats 600 1,000 1,500 60
(see #3) (see #3)
Rough Rice 250 500 750 50
(see #4)
Soybean Oil 5200 3,000 4,000 175
(see #3) (see #3)
Soybean Meal 720 3,000 4,000 175
(see #3) (see #3)
Corn Yield Insurance 1,000 1,000 1,000 25
(see #5)
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Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
------------------------------------------------------------------------------
Rough Rice 250 500 750 50
(see #4)
Soybean Oil 5200 3,000 4,000 175
(see #3) (see #3)
Soybean Meal 720 3,000 4,000 175
(see #3) (see #3)
Corn Yield Insurance 1,000 1,000 1,000 25
(see #5)
------------------------------------------------------------------------------
#1 See subsection (g) for an explanation of adjusted limits for persons owning
or controlling joint positions in 1,000 oz. Silver and 5,000 oz. Silver
contracts.
#2 See subsection (h) for an explanation of adjusted limits for persons owning
or controlling joint positions in Kilo Gold and 100 oz. Gold contracts.
#3 Additional futures contracts may be held outside of the spot month as part of
futures/futures spreads within a crop year provided that the total of such
positions, when combined with outright positions, do not exceed the all months
combined limit. In addition, Regulation 495.01 allows for additional futures
contracts to be held as part of futures/options spreads provided that such
positions are held outside of the spot month.
#4 On and after the first notice day of the expiring futures month of July, the
limit for the July futures month will be reduced to 200 contracts, for both
hedging and speculative positions.
#5 Specifications apply separately to each of the following Corn Yield Insurance
contracts: Iowa, Illinois, Indiana, Nebraska, Ohio, U.S.
#6 In the last five trading days of the expiring future month, the speculative
position limit for the March futures month will be 350 contracts and for the May
futures month the limit will be 220 contracts.
#7 In the last three trading days of the expiring futures month, the speculative
position limit for that spot month futures contract will be 20000 contracts. No
exemptions will be applicable during the last three days of trading of the
expiring spot month contracts.
Except for the interest of a limited partner or shareholder (other than the
commodity pool operator) in a commodity pool, ownership, including a 10% or more
financial ownership interest, shall constitute control over an account except as
provided in Regulation 425.05.
The maximum positions which any person, as defined in Regulation 425.01 (b), may
own or control shall be as set forth herein. However, with respect to the
maximum positions which a member firm may carry for its customers, it shall not
be a violation of the limits set forth herein to carry customer positions in
excess of such limits for such reasonable period of time as the firm may require
to discover and liquidate the excess positions or file the appropriate hedge or
exemption statements for the customer accounts in question in accordance with
Regulations 425.03 and 425.04. For the purposes of this regulation, a
"reasonable period of time" shall generally not exceed one business day for
those positions that are not subject to the provisions of Regulations 425.03 and
425.04.
Note: The Commodity Futures Trading Commission has imposed speculative position
limits on Corn, Oats, Soybean, Wheat, Soybean Oil and Soybean Meal futures
contracts as provided in Part 150 of CFTC Regulations.
(b) The term "net" shall mean the long or short position held after offsetting
long futures positions against short futures positions. The word "person"
shall include individuals, associations, partnerships, limited liability
companies, corporations and trusts.
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
(c) The foregoing limit on positions shall not apply to bona fide hedging
positions which meet the requirements of Regulations 425.02 and 425.03, nor
to positions subject to particular limits granted pursuant to Regulation
425.04.
(d) The Board, or a Committee authorized by the Board may direct any member or
registered eligible business organization owning, controlling or carrying a
position for a person whose total position as defined in subsection (e)
below exceeds the position limits as set forth in subsection (a) above or
as specifically determined pursuant to Regulations 425.03 or 425.04 to
liquidate or otherwise reduce the position.
(e) In determining whether any person has exceeded the position limits
specified in subsection (a) of this Regulation or those limits determined
pursuant to Regulations 425.03 or 425.04, or whether a position is a
reportable position as set forth in subsections (a) and (f) herein, all
positions in accounts for which such person by power of attorney or
otherwise directly or indirectly controls trading, except as provided in
Regulation 425.05, shall be included with the positions held by such
person. Such limits upon positions shall apply to positions held by two or
more persons acting pursuant to an expressed or implied agreement or
understanding, the same as if the positions were held by a single person.
(f) If a person owns, controls or carries a position equal to or greater than
the number of contracts specified in subsection (a) above long or short in
any one month, then all such futures and options on such futures contract
owned, controlled or carried by that person, whether above the given level
or not, shall necessarily be deemed reportable positions. Every member or
registered eligible business organization shall report each and every
reportable position to the Office of Investigations and Audits at such
times and in such form and manner as shall be prescribed by the Business
Conduct Committee.
(1) On or before the first day on which any position must be reported as
provided above, the member or registered eligible business
organization carrying the position must furnish to the Office of
Investigations and Audits a report, in the form, manner and content
prescribed by the Business Conduct Committee, identifying the owner of
the account for which the position must be reported and all persons
associated with the account as described in subsection (e) above.
(2) Every member or registered eligible business organization must report
each and every reportable position and provide the report required in
subsection (1) above for each person within any account carried on an
omnibus basis, unless, upon application of the member or registered
eligible business organization to the Business Conduct Committee, the
nonmember omnibus account specifically is approved to report directly
to the Office of Investigations and Audits.
(g) In the event that a person owns or controls joint positions in 1,000 oz.
Silver futures and 5,000 oz. Silver futures, position limits will be
subject to the following:
(1) For 1,000 oz. Silver futures, the spot month maximum position limit of
5,000 contracts net long (net short) shall be reduced by five for every
one net long (net short) 5,000 oz. Silver futures position that is
owned or controlled in the spot month. In all months combined, the
maximum position limit of 20,000 contracts, net long (net short) shall
be reduced by five for every one net long (net short), 5,000 oz. Silver
futures position that is owned or controlled. Alternatively, the
maximum position limit of 20,000 contracts, net long (net short) in all
months combined, shall be increased by five for every one net short
(net long) 5,000 oz. Silver futures position that is owned or
controlled. For example, in all months combined, a person could own or
control 15,000 contracts, net long (net short), provided that the
person does not also own or control more than 1,000 net long (net
short) 5,000 oz. Silver futures positions.
(2) For 5,000 oz. Silver futures, the spot month maximum position limit of
1,000 contracts net long (net short) shall be reduced by one for every
five net long (net short) 1,000 oz. Silver futures positions that are
owned or controlled in the spot month. In all months combined, the
maximum position limit of 4,000 contracts, net long (net short) shall
be reduced by one for every five net long (net short) 1,000 oz. Silver
futures positions that are owned or controlled. Alternatively, the
maximum position limit of 4,000 contracts, net long (net short) in all
months combined, shall be
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
increased by one for every five net short (net long) 1,000 oz. Silver
futures positions that are owned or controlled. For example, in all
months combined, a person could own or control 3,000 contracts, net long
(net short), provided that the person does not also own or control more
than 5,000 net long (net short) 1,000 oz. Silver futures positions.
(h) In the event that a person owns or controls joint positions in Kilo Gold
futures and 100 oz. Gold futures, position limits will be subject to the
following:
(1) For Kilo Gold futures, the spot month maximum position limit of 6,000
contracts net long (net short) shall be reduced by three for every one
net long (net short) 100 oz. Gold futures position that is owned or
controlled in the spot month. In all months combined, the maximum
position limit of 12,000 contracts, net long (net short) shall be
reduced by three for every one net long (net short) 100 oz. Gold futures
position that is owned or controlled. Alternatively, the maximum
position limit of 12,000 contracts, net long (net short) in all months
combined, shall be increased by three for every one net short (net long)
100 oz. Gold futures position that is owned or controlled. For example,
in all months combined, a person could own or control 9,000 contracts,
net long (net short), provided that the person does not also own or
control more than 1,000 net long (net short) 100 oz. Gold futures
positions.
(2) For 100 oz. Gold futures, the spot month maximum position limit of 2,000
contracts net long (net short) shall be reduced by one for every three
net long (net short) Kilo Gold futures position that are owned or
controlled in the spot month. In all months combined, the maximum
position limit of 4,000 contracts, net long (net short) shall be reduced
by one for every three net long (net short) Kilo Gold futures positions
that are owned or controlled. Alternatively, the maximum position limit
of 4,000 contracts, net long (net short) in all months combined, shall
be increased by one for every three net short (net long) Kilo Gold
futures positions that are owned or controlled. For example, in all
months combined, a person could own or control 3,000 contracts, net long
(net short), provided that the person does not also own or control more
than 3,000 net long (net short) Kilo Gold futures positions. (08/01/00)
425.02 Bona Fide Hedging Positions in Futures-
(a) General Definition. Bona fide hedging positions in futures shall mean
positions in a contract for future delivery on this Exchange, where such
positions normally represent a substitute for positions to be taken at a
later time in a physical marketing channel, and where they are economically
appropriate to the reduction of risks in the conduct and management of a
commercial enterprise, and where they arise from:
(1) The potential change in the value of assets which a person owns, refines
or merchandises or anticipates owning, refining or merchandising,
(2) The potential change in the value of liabilities which a person owes or
anticipates incurring, or
(3) The potential change in the value of services which a person provides,
purchases or anticipates providing or purchasing.
Notwithstanding the foregoing, no positions of a person shall be classified
as bona fide hedging unless their purpose is to offset price risks
incidental to that person's commercial cash or spot operations and such
positions are established and liquidated in an orderly manner in accordance
with sound commercial practices and unless the provisions of Regulation
425.03 have been satisfied.
(b) Enumerated Hedging Positions. For purposes of Regulation 425.03, the
definition of bona fide hedging positions in subsection (a) above includes,
but is not limited to, the following specific positions:
(1) Sales of any commodity for future delivery, which do not exceed in
quantity:
(i) Ownership of the same cash commodity by the same person, and
(ii) Fixed-price purchases of the same cash commodity by the same
person.
Ch4 Position Limits and Reportable Positions in Futures
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(2) Purchases of any commodity for future delivery, which do not exceed in
quantity:
(i) Fixed-price sales of the same cash commodity by the same person;
and
(ii) The quantity equivalent of fixed-price sales of the cash products
and derivative products of such commodity by the same person.
(3) Sales and purchases for future delivery described in subsections (b)(1)
and (b)(2) may also be offset by the same or other quantities of a
different cash commodity, provided that the fluctuations in the value of
the position for future delivery are substantially related to the
fluctuations in the value of the actual cash position.
(c) Non-Enumerated Hedging Positions. The Board, or a Committee authorized by
the Board, may recognize positions other than those enumerated in subsection
(b) as bona fide hedging positions, in accordance with the general
definition of hedging in Regulation 425.02(a), upon the filing of a
satisfactory initial statement in accordance with Regulation 425.03. Such
positions may include:
(1) Short-hedging positions of unsold anticipated positions in the same cash
commodity by the same person;
(2) Long-hedging positions of unfilled anticipated requirements of the same
cash commodity by the same person;
(3) Short or long cross-hedging positions, provided that the fluctuations in
the value of the positions for future delivery are substantially related
to the fluctuations in the value of the anticipated cash positions; or
(4) Any other positions in commodities for future delivery under such terms
and conditions as the Board, or a Committee authorized by the Board, may
specify.
(d) Cash positions described in subsections (b) and (c) above shall not include
those positions or portions of positions which are economically appropriate
hedging positions in options pursuant to Regulations 495.02 and 495.03.
Note: Corn, Oats, Soybean, Soybean Oil, Soybean Meal and Wheat futures
contracts are subject to Commodity Futures Trading Commission Regulation
1.3(z), which defines bona fide hedging transactions and positions.
(08/01/94)
425.03 Reporting Requirements For Bona Fide Hedging Positions in Futures in
Excess of Limits-
(a) Initial Statement. Every member or registered eligible business organization
which owns, controls, or carries positions on behalf of a person who seeks
classification of such positions as bona fide hedging positions must file a
statement satisfactory to designated staff or a Committee authorized by the
Board in order to classify such positions as bona fide hedging positions
within the meaning of Regulation 425.02. The initial statement of the member
or registered eligible business organization filed on behalf of a person
shall be filed no later than 10 business days after the day on which the
person's position exceeds the speculative limit for each contract specified
in Regulation 425.01 (a), and shall include:
(1) A description of the kinds of intended positions and their potential
size;
(2) A statement affirming that the kinds of intended positions are bona
fide hedging positions; and
(3) With respect to the kinds of intended positions that are described as
non-enumerated hedging positions under Regulation 425.02(c), a
justification that the kinds of intended positions are consistent with
the definition of bona fide hedging positions within the meaning of
Regulation 425.02(a).
(b) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to this
Regulation, a supplemental statement which updates and confirms previous
information shall be filed with designated staff or a Committee authorized
by the Board by every member or registered eligible business organization
owning, controlling or carrying such person's position. The supplemental
statement shall be filed no later than 10 business days after
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
the day on which the person's position exceeds the level specified in the
most recent statement.
(c) A Committee or designated staff authorized by the Board will monitor bona
fide hedging positions. The initial and supplemental statements prescribed
in subsections (a) and (b) above must be submitted to the Office of
Investigations and Audits and shall be maintained on a confidential basis.
The Board, or a Committee or designated staff authorized by the Board may
request additional relevant information necessary to ensure compliance with
this Regulation 425.03. (09/01/99)
425.04 Exemptions From Position Limits in Futures-
(a) The Board, or a Committee authorized by the Board, may establish particular
position limits on those positions of a person normally known as "spreads,
straddles or arbitrage," including:
(1) intramarket spreads;
(2) intermarket spreads; or
(3) cash-futures arbitrage, where "cash" is defined as spot or forward
positions.
In addition, the Board or a Committee authorized by the Board, may
establish, on a case by case basis, particular maximum position limits on
certain risk management positions in interest rate, stock index and currency
futures, including:
(1) Long positions in futures whose underlying commodity value does not
exceed the sum of:
(i) Cash set aside in an identifiable manner, or any of the following
unencumbered instruments so set aside, with maturities of less
than 1 year: U.S. Treasury obligations; U.S. agency discount
notes; commercial paper rated A2 or better by Standard & Poors and
P2 or better by Moody's; banker's acceptances; or certificates of
deposit, plus any funds deposited as margin on such positions; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
(2) Long positions in futures whose underlying commodity value does not
exceed the sum of:
(i) The value of equity securities, debt securities, or currencies
owned and being hedged by the trader holding such futures or
option position, provided that the fluctuations in value of the
position used to hedge such securities are substantially related
to the fluctuations in value of the securities themselves; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
Risk management positions eligible for particular position limits under this
Regulation do not include those considered as bona fide hedging positions as
defined in Regulation 425.02.
(b) Requirements for Exemptions from Position Limits in Futures. Every member or
registered eligible business organization which owns, controls or carries
positions on behalf of a person who wishes to make purchases or sales of any
commodity for future delivery in excess of the position limits then in
effect, shall file statements on behalf of the person with the Exchange, in
such form and manner as shall be prescribed by the Board, or by a Committee
authorized by the Board, in conformity with the requirements of this
subsection.
(1) Initial Statement. Initial statements concerning the classification of
positions normally known in the trade as "spreads, straddles or
arbitrage, or risk management positions," for the purpose of subjecting
such positions to particular position limits above those specified in
Regulation 425.01 (a), shall be filed with designated staff or
Committee authorized by the Board no later than 10 business days after
the day on which such positions exceed the position limits then in
effect. Such statements shall include information necessary to enable
the Board, or a Committee authorized by the Board, to make a
determination that the particular kinds of intended positions should be
eligible for a higher position limit, including, but not limited to:
(i) A description of the specific nature and size of positions for
future delivery and offsetting cash, forward or futures positions,
where applicable, and affirmation that intended positions to be
maintained in excess of the limits set forth in Regulation 425.01
(a) will
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
be positions as set forth in subsection (a) above; and
(ii) In the case of risk management positions, information on the cash
portfolio being managed and/or any cash or cash market
instruments held in connection with the intended risk management
position, as well as other information relevant to the conditions
specified in subsection (a) above. Of particular interest are
whether the cash market underlying the futures market has a high
degree of demonstrated liquidity relative to the size of
positions, and whether there exist opportunities for arbitrage
which provide a close linkage between the cash market and the
futures market in question; and whether the positions are on
behalf of a commercial entity, including parents, subsidiaries or
other related entities, which typically buys, sells or holds the
underlying or a related cash market instrument.
(2) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to
this Regulation, a supplemental statement which updates and confirms
previous information shall be filed with designated staff or a
Committee authorized by the Board by every member or registered
eligible business organization owning, controlling or carrying such
person's position. The supplemental statement shall be filed no later
than 10 business days after the day on which the person's position
exceeds the level specified in the most recent statement.
(c) A Committee or designated staff authorized by the Board will monitor the
positions maintained by persons who have obtained particular position
limits under the provisions of this Regulation. The initial and
supplemental statements prescribed in subsections (b)(1) and (b)(2) above
must be submitted to the Office of Investigations and Audits and shall be
maintained on a confidential basis. The Board, or a Committee or designated
staff authorized by the Board, may request additional relevant information
necessary to ensure compliance with this Regulation 425.04, and may, for
any good reason, amend, revoke or otherwise limit the particular position
limits established.
(d) The provisions of this Regulation 425.04 shall not apply to Corn, Oats,
Soybean, Wheat, Soybean Oil and Soybean Meal futures contracts traded on the
Exchange. (09/01/99)
425.05 Exemption from Aggregation for Position Limit Purposes in Futures-
A. Positions carried for an eligible entity as defined in Commodity Futures
Trading Commission Regulation 150.01(d), in a separate account or accounts
of an independent account controller, as defined in Commodity Futures
Trading Commission Regulation 150.01(e) may exceed the position limits set
forth in Regulations 425.01 and/or 495.01 to the extent such positions are
positions not for the spot month and which are carried for an eligible
entity as defined by Commodity Futures Trading Commission Regulation 150.01
or such other persons as the Commission deems exempt pursuant to Regulation
150.3, in the separate account or accounts of an independent account
controller provided however, that the overall positions held or controlled
by each such independent account controller may not exceed the limits
specified in Regulations 425.01 or 495.01.
B. Additional Requirements for Exemption of Affiliated Entities - If the
independent account controller is affiliated with the eligible entity or
another independent account controller, each of the affiliated entities
must:
1) Have and enforce, written procedures in place to preclude such account
controllers from having knowledge of, gaining access to, or receiving
data about, trades of other account controllers. Such procedures must
include document routing, and other procedures or security
arrangements, including separate physical locations, which would
maintain the independence of their activities provided, however, that
such procedures may provide for the disclosure of information which is
reasonably necessary for an eligible entity to maintain the level of
control consistent with the fiduciary responsibilities and necessary to
fulfill its duty to supervise diligently the trading done on its
behalf;
2) Trade such accounts pursuant to separately developed and independent
trading systems and market such trading systems separately; and
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
3) Solicit funds for such trading by separate Disclosure Documents that
meet the standards of Commodity Futures Trading Commission Regulation
4.21.
C. Upon request by the Board or a Committee authorized by th````````or such
person responsible for the supervision of the Office of Investigations and
Audits, any person claiming an exemption from speculative position limits
under this Regulation must provide to the Exchange such information as
specified in the request relating to the positions owned or controlled by
that person; trading done pursuant to the claimed exemption; the futures,
options, or cash market positions which support the claim of the exemption;
and the relevant business relationships supporting a claim of exemption.
(08/01/94)
425.06 Position Accountability for U.S. Treasury Bond Futures - A person as
defined in Regulation 425.01(b), who owns or controls more than 10,000 U.S.
Treasury Bond futures contracts net long or net short in all months combined, or
net long or net short in the spot month, shall provide, in a timely manner upon
request by the Association, information regarding the nature of the position,
trading strategy, and hedging information if applicable. In addition, such
positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (08/01/94)
425.07 Position Accountability for Long-Term and Medium-Term Treasury Note
Futures - A person as defined in Regulation 425.01(b), who owns or controls
more than 7,500 Long-Term Treasury Note futures contracts or more than 7,500
Medium-Term Treasury Note futures contracts, net long or net short in all months
combined, or net long or net short in the spot month, shall thereby be subject
to the following provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such person automatically shall consent, when so ordered by the Association
acting in its discretion, not to increase further the position in Long-Term
Treasury Note futures or Medium-Term Treasury Note futures which exceeds the
above-referenced 7,500 contract level.
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (08/01/94)
425.08 Position Accountability for 30-Day Fed Funds Futures - A person as
defined in Regulation 425.01(b), who owns or controls more than 3,000 30-Day Fed
Fund futures contracts, net long or net short in all months combined, or net
long or net short in the spot month, shall thereby be subject to the following
provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such person automatically shall consent, when so ordered by the
Association acting in its discretion, not to increase further the
position in 30-Day Fed Fund futures contracts which exceeds the above-
referenced 3,000 contract level.
Ch4 Position Limits and Reportable Positions in Futures
-------------------------------------------------------
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney of otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (04/01/96)
Ch4 Margins and Deposits
430.00 Deposits by Customers - A member acting as commission merchant for a
customer (member or non-member) may require from such customer a deposit, as
indemnity against liability, and subsequent deposits to the extent of any
adverse fluctuations in the market price. Such deposits must be made with the
commission merchant within a reasonable time after demand, and, in the absence
of unusual circumstances, one hour shall be deemed a reasonable time. The
failure of the customer to make such deposit within such time, shall entitle,
but shall not obligate, the commission merchant to close out the trades of the
defaulting customer. If the commission merchant is unable to effect personal
contact with the customer, a written demand left at the office of the customer,
during business hours, shall be deemed sufficient. 209 (08/01/94)
431.00 Margins - No member may accept or carry an account for a customer,
whether a member or non-member, without proper and adequate margin. The Exchange
shall fix minimum margin requirements.
The provisions of the foregoing paragraph do not apply to a non-clearing member
who makes his own trades or who on the Floor gives his orders for trades which
are exclusively for his own account and pays the brokerage thereon. 210
(08/01/94)
431.00A Permit Holder Interpretation - The term 'non-clearing member' in
paragraph 2 of Rule 431.00 should be interpreted to include Permit Holders.
(08/01/94)
431.01 Margins - Non-Clearing Members - A non-clearing member who makes his
own futures trades or who on the Floor gives his orders for futures trades which
are exclusively for his account shall be subject solely to the provisions of
this Regulation. All futures transactions in such account shall be margined to
the market. 1822B (08/01/94)
431.02 Margin Requirements - Margin requirements shall at all times be those
requirements currently in effect. Changes in margin requirements shall be
effective on all transactions.
1. Transferred to Regulations 431.03 and 431.05.
2. Clearing members may carry contracts for future delivery for foreign and
domestic correspondents on a gross margin basis as provided in Paragraph 3
of Regulation 431.03, but only to the extent that such contracts are those
of customers and non-customers of the foreign and domestic correspondents.
3. If stocks, bonds or similar collateral, which must be free from liens and
from any impediments to negotiability, are deposited with a member
specifically to secure transactions which are executed on this Exchange, the
current market value less the applicable haircut as specified in SEC Rule
15c3-1(c)(2)(vi) may be considered as margin value to such transactions.
A registered futures commission merchant shall not accept as margin, pledge,
hypothecate, assign or factor any customer owned warehouse receipt other
than a warehouse receipt that is eligible for delivery in satisfaction of
futures contracts at a contract market.
4. Foreign currencies or foreign government securities which are deposited with
a member for margin purposes must be reported at the current rate of
exchange to the dollar equivalent. The margin value will be determined by
Regulation 431.02 paragraph 3.
5. In computing minimum margin requirements for any customer equities or
impairment resulting from change in market prices shall be regarded as money
equivalents.
6. No member shall extend any credit or give any rebate or gratuity of any kind
to any person for the purpose of circumventing or evading minimum margin
requirements.
7. It shall be incumbent upon each member to require satisfactory evidence that
all hedging trades are bona fide hedging trades. A letter from a customer so
stating will be considered "satisfactory evidence" under this paragraph
unless there is reason to suspect otherwise.
8. An account shall be entitled to spread margins, whenever said account is in
a spread position. The
Ch4 Margins and Deposits
------------------------
carrying member shall designate spread position on his margin records.
9. When a correspondent member's account with the Clearing House member
consists of trades which are spreading trades, such account may be carried
as a spreading account by the clearing member.
10. It shall be incumbent upon each member financing purchases of cash grain for
country elevator customers to require satisfactory evidence that funds so
loaned are not used to margin future contracts other than for the purpose of
hedging cash grain.
When a customer states that funds required to fully margin his account are
being transmitted at once, the member may consider this assurance in lieu of
cash for a reasonable period. Members are required to keep written records
of all margin calls, whether made in writing or by telephone.
11. Members shall not accept orders for new trades from a customer, unless the
minimum initial margin on the new trades is deposited and unless the margin
on old commitments in the account equals or exceeds the initial requirements
on hedging and spreading trades and/or the maintenance requirements
specified in Regulations 431.03 and 431.05 on all other trades. If the
customer has a credit in excess of the initial margin requirements on all
old commitments in his account, this may be used as part or all of the
initial margins required on new commitments. However, credits in excess of
maintenance margins and less than initial margin requirements may not be
used.
12. No customer shall be permitted to make withdrawals from an account when the
margin therein is less than the minimum initial margin specified in
Regulations 431.03 and 431.05 or when the withdrawals would impair such
minimum requirements.
13. No member may carry for a customer spreading transactions when the
customer's account, figured to the market, would result in a deficit.
Minimum maintenance margins required on other transactions are specified in
Regulations 431.03 and 431.05. When a customer's account drops below the
maintenance margin level, the account must be brought back to initial margin
requirements. The failure of a member to close the customer's account before
it results in such deficit or undermargined condition shall not relieve the
customer of any liability to the member, nor shall such failure on the part
of a member amount to an extension of credit to the customer if the member
in the exercise of reasonable care has been unable to close the account
without incurring such deficit or undermargined condition.
14. A member may use his discretion in permitting a customer having an
established account to trade during any day without margining each
transaction, provided the net position resulting from the day's trading is
margined as required by Rules 286.00, 431.00 and Regulations 431.02, 431.03
and 431.05.
15. When a customer switches an open interest in the same grain from one future
to another and the orders for the purchase and sale are placed
simultaneously, no additional margins need be required by his commission
merchant because of such switch. However, if such orders are not placed
simultaneously, the new position should be margined on the basis of minimum
initial margin requirements.
16. A bona fide hedger, in financial instruments, reporting positions on a gross
basis pursuant to Regulation 705.01, must pay appropriate margins on the
gross positions reported during the delivery month. 1822 (08/01/94)
431.02A Hedging Transactions - WHEREAS, Regulation 431.02(7) makes it incumbent
"upon each member to require satisfactory evidence that all hedging trades are
bona fide hedging trades," and
WHEREAS, Regulation 431.02(7) further states that "a letter from a customer so
stating will be considered 'satisfactory evidence' unless there is reason to
suspect otherwise;"
NOW THEREFORE, BE IT RESOLVED that whenever a non-member customer of a member or
member firm carries in its hedging account an open position in any Board of
Trade futures contract exceeding speculative position limits established by the
Association, it shall be incumbent upon the member or member firm to satisfy
itself, and to be able to confirm to the Business Conduct Committee that the
open position of such non-member customer, to the extent that it exceeds such
speculative position limits,
Ch4 Margins and Doposits
------------------------
represents bona fide hedging transactions.
BE IT FURTHER RESOLVED that this resolution be published as a Ruling of the
Association. 42R (08/01/94)
431.03 Margin on Futures - (08/01/00)
(1) MAINTENANCE AND INITIAL MARGINS. Other than Hedging or Spreading. Under
the provisions of Rule 431.00, the Exchange hereby fixes the following
minimum maintenance* and initial* margins for futures transactions, other
than hedging and spreading transactions:
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Initial
Margin Initial
Maintenance Margin Mark-Up Margin
Percentage
-------------------------------------------------------------------------------------------------------------
Agricultural Group
-------------------------------------------------------------------------------------------------------------
Corn $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------------------
Iowa Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Illinois Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Indiana Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Nebraska Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Ohio Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
U.S. Corn Yield Insurance $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Oats $ 300 per contract 135% $ 2005
-------------------------------------------------------------------------------------------------------------
Rough Rice $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------------------
Soybeans $ 1,000 per contract 135% $ 1,350
-------------------------------------------------------------------------------------------------------------
Soybean Meal $ 700 per contract 135% $ 810
-------------------------------------------------------------------------------------------------------------
Soybean Oil $ 2000 per contract 135% $ 5200
-------------------------------------------------------------------------------------------------------------
Wheat $ 550 per contract 135% $ 743
-------------------------------------------------------------------------------------------------------------
Metals Group
-------------------------------------------------------------------------------------------------------------
Gold - One Kilo $ 675 per contract 135% $ 473
-------------------------------------------------------------------------------------------------------------
Gold - 100 Ounce $ 1,050 per contract 135% $ 1,418
-------------------------------------------------------------------------------------------------------------
Silver - 1000 Ounce $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Silver - 5000 Ounce $1,688 per contract 135% $ 1,350
-------------------------------------------------------------------------------------------------------------
Financial Instrument Group
-------------------------------------------------------------------------------------------------------------
Treasury Bonds $1,500 per contract 135% $ 2,025
-------------------------------------------------------------------------------------------------------------
Treasury Note (6 1/2-10 year) $1,000 per contract 135% $ 1,350
-------------------------------------------------------------------------------------------------------------
Treasury Note (5 year) $ 600 per contract 135% $ 810
-------------------------------------------------------------------------------------------------------------
Treasury Note (2 year) $ 500 per contract 135% $ 675
-------------------------------------------------------------------------------------------------------------
Agency Notes (10 year) $ 900 per contract 135% $ 1,215
-------------------------------------------------------------------------------------------------------------
30-Day Fed Fund $ 200 per contract 135% $ 270
-------------------------------------------------------------------------------------------------------------
Municipal Bond Index $1,000 per contract 135% $ 1,350
-------------------------------------------------------------------------------------------------------------
Stock Index Group
-------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $4,000 per contract 135% $5,2000
-------------------------------------------------------------------------------------------------------------
Ch4 Margins and Doposits
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DJIA(SM) Index $2,000 per contract 135% $ 2,700
---------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $1,500 per contract 135% $ 2,025
---------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $1,500 per contract 135% $ 2,025
---------------------------------------------------------------------------------------------------------------
*Variable margin requirements, which go into effect when variable limits are
imposed in accordance with Regulation 1008.01, are 150% of the stated margin
requirement.
---------------------------------------------------------------------------------------------------------------
PCS Insurance Group
(Margins on theoretical futures for options on
the following)
---------------------------------------------------------------------------------------------------------------
National Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
National Catastrophe (loss period and beyond)** $2,000 per contract 135% $ 2,700
---------------------------------------------------------------------------------------------------------------
Eastern Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
Eastern Catastrophe (loss period and beyond)** $2,000 per contract 135% $ 2,700
---------------------------------------------------------------------------------------------------------------
Southeastern Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
Southeastern Catastrophe (loss period and $2,000 per contract 135% $ 2,700
beyond)**
---------------------------------------------------------------------------------------------------------------
Western Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
Western Catastrophe (loss period and beyond)** $2,000 per contract 135% $ 2,700
---------------------------------------------------------------------------------------------------------------
California Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
California Catastrophe (loss period and beyond)** $2,000 per contract 135% $ 2,700
---------------------------------------------------------------------------------------------------------------
Midwestern Catastrophe $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
Midwestern Catastrophe (loss period and beyond)** $ 200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
Northeastern Catastrophe $ 100 per contract 135% $ 135
---------------------------------------------------------------------------------------------------------------
Northeastern Catastrophe (loss period and $ 100 per contract 135% $ 135
beyond)**
---------------------------------------------------------------------------------------------------------------
Third Quarter '99 National, Eastern, $ 200 per contract 135% $ 270
Southeastern, and Florida
and Florida
---------------------------------------------------------------------------------------------------------------
1999 Annual National and Western $200 per contract 135% $ 270
---------------------------------------------------------------------------------------------------------------
**Loss period margins are effective as of the first trading day of the loss
period or sooner if designated by the Board.
(2) HEDGING MARGINS. Subject to the provisions of Paragraphs 8, 9,10 and 11 of
Regulation 431.02, minimum initial* and maintenance* hedging margins on all
commitments in futures shall be as follows:
[Enlarge/Download Table]
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Initial
Margin Initial
Maintenance Margin Mark-Up Margin
Percentage
--------------------------------------------------------------------------------------------------------------------------
Agricultural Group
--------------------------------------------------------------------------------------------------------------------------
Ch4 Margins and Doposits
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[Enlarge/Download Table]
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Corn $ 500 per contract 100% $ 500
---------------------------------------------------------------------------------------------------------------------
Iowa Corn Yield Insurance $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Illinois Corn Yield Insurance $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Indiana Corn Yield Insurance $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Nebraska Corn Yield Insurance $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Ohio Corn Yield Insurance $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
U.S. Corn Yield Insurance $ 300 per contract 100% $ 300
---------------------------------------------------------------------------------------------------------------------
Oats $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Rough Rice $ 500 per contract 100% $ 500
---------------------------------------------------------------------------------------------------------------------
Soybeans $ 1000 per contract 135% $ 1000
---------------------------------------------------------------------------------------------------------------------
Soybean Meal $ 700 per contract 135% $ 700
---------------------------------------------------------------------------------------------------------------------
Soybean Oil $ 2000 per contract 100% $ 2000
---------------------------------------------------------------------------------------------------------------------
Wheat $ 550 per contract 100% $ 550
---------------------------------------------------------------------------------------------------------------------
Metals Group
---------------------------------------------------------------------------------------------------------------------
Gold - One Kilo $ 350 per contract 100% $ 350
---------------------------------------------------------------------------------------------------------------------
Gold - 100 Ounce $1,050 per contract 100% $1,050
---------------------------------------------------------------------------------------------------------------------
Silver - 1000 Ounce $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Silver - 5000 Ounce $1,000 per contract 100% $1,000
---------------------------------------------------------------------------------------------------------------------
Financial Instrument Group
---------------------------------------------------------------------------------------------------------------------
Treasury Bonds $1,500 per contract 100% $1,500
---------------------------------------------------------------------------------------------------------------------
Treasury Note (6 1/2-10 year) $1,000 per contract 100% $1,000
---------------------------------------------------------------------------------------------------------------------
Treasury Note (5 year) $ 600 per contract 100% $ 600
---------------------------------------------------------------------------------------------------------------------
Treasury Note (2 year) $ 500 per contract 100% $ 500
---------------------------------------------------------------------------------------------------------------------
Agency Notes (10 year) $ 700 per contract 135% $ 700
---------------------------------------------------------------------------------------------------------------------
30 Day Fed Funds $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Municipal Bond Index $1,000 per contract 100% $1,000
---------------------------------------------------------------------------------------------------------------------
Stock Index Group
---------------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $4,000 per contract 100% $4,000
---------------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $1,500 per contract 100% $1,500
---------------------------------------------------------------------------------------------------------------------
DJIA(SM) Index $1,500 per contract 100% $1,500
---------------------------------------------------------------------------------------------------------------------
PCS Insurance Group
(Margins on theoretical futures for options on the
following)
---------------------------------------------------------------------------------------------------------------------
National Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Ch4 Margins and Doposits
------------------------
[Enlarge/Download Table]
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National Catastrophe (loss period and beyond)** $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
Eastern Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Eastern Catastrophe (loss period and beyond)** $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
Southeastern Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
*Variable margin requirements, which go into effect when variable limits are
imposed in accordance with Regulation 1008.01, are 150% of the stated margin
requirement.
---------------------------------------------------------------------------------------------------------------------
Southeastern Catastrophe (loss period and beyond)** $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
Western Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Western Catastrophe (loss period and beyond)** $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
California Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
California Catastrophe (loss period and beyond)** $2,000 per contract 100% $2,000
---------------------------------------------------------------------------------------------------------------------
Midwestern Catastrophe $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Midwestern Catastrophe (loss period and beyond)** $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
Northeastern Catastrophe $ 100 per contract 100% $ 100
---------------------------------------------------------------------------------------------------------------------
Northeastern Catastrophe (loss period and beyond)** $ 100 per contract 100% $ 100
---------------------------------------------------------------------------------------------------------------------
Third Quarter '99 National, Eastern, Southeastern, and $ 200 per contract 100% $ 200
Florida
---------------------------------------------------------------------------------------------------------------------
Fourth Qtr. '99 National, Eastern, Southeastern, and $ 200 per contract 100% $ 200
Florida
---------------------------------------------------------------------------------------------------------------------
1999 Annual National and Western $ 200 per contract 100% $ 200
---------------------------------------------------------------------------------------------------------------------
**Loss period margins are effective as of the first trading day of the loss
period or sooner if designated by the Board.
(3) SPREADING MARGINS. The minimum maintenance margin of spreading
transactions shall be as follows:
Intra-market spreads (involving the same commodity) where both sides of the
transaction are carried on the books of one member firm shall be margined
to the market, except for the following commodities which will be margined
as indicated:
---------------------------------------------------------
Old crop/New crop: Initial/Maintenance
---------------------------------------------------------
Corn $ 135 / $ 100
---------------------------------------------------------
Soybeans $ 473 / $ 350
---------------------------------------------------------
Soybean Meal $ 338 / $ 250
---------------------------------------------------------
Ch4 Margins and Deposits
------------------------
-----------------------------------------------------
Soybean Oil $ 135 / $ 100
-----------------------------------------------------
Wheat $ 135 / $ 100
-----------------------------------------------------
Oats $ 135 / $ 100
-----------------------------------------------------
Inter-market spreads where both sides of the transaction are carried on the
books of one member firm shall be as follows (See paragraph (1) for initial
margin mark-up percentage):
[Enlarge/Download Table]
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Spread Spread Credit %
------------------------------------------------------------------------------------------------------------
Soybeans vs. Soybean Oil 50%
------------------------------------------------------------------------------------------------------------
Soybeans vs. Soybean Meal 65%
------------------------------------------------------------------------------------------------------------
*Corn vs. Illinois Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
*Corn vs. Indiana Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
*Corn vs. Iowa Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
*Corn vs. Ohio Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
*Corn vs. U.S. Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
*Corn vs. Nebraska Corn Yield Insurance 30%
------------------------------------------------------------------------------------------------------------
Treasury Notes (6-1/2-10 year) vs. Treasury Bonds 75%
------------------------------------------------------------------------------------------------------------
(2) Treasury Notes (6-1/2-10 year) vs. Treasury Bonds 75%
------------------------------------------------------------------------------------------------------------
(3) Treasury Notes (5 year) vs. (2) Treasury Notes (6-1/2-10 year) 85%
------------------------------------------------------------------------------------------------------------
Treasury Notes (6-1/2-10 year) vs. Municipal Bond Index 70%
------------------------------------------------------------------------------------------------------------
Treasury Notes (2 year) vs. Municipal Bond Index 200%
------------------------------------------------------------------------------------------------------------
Treasury Bonds vs. Municipal Bond Index 70%
------------------------------------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Treasury Notes (6-1/2-10 year) 75%
------------------------------------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Treasury Bonds 55%
------------------------------------------------------------------------------------------------------------
(5) Treasury Notes (5 year) vs. (2) Treasury Bonds 70%
------------------------------------------------------------------------------------------------------------
Treasury Notes (5 year) vs. Municipal Bond Index 50%
------------------------------------------------------------------------------------------------------------
(5) Treasury Notes (2 year) vs. (2) Treasury Bonds 60%
------------------------------------------------------------------------------------------------------------
Treasury Notes (2 year) vs. Treasury Notes (6-1/2-10 year) 65%
------------------------------------------------------------------------------------------------------------
Ch4 Margins and Doposits
------------------------
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Treasury Notes (2 year) vs. Treasury Notes (5 year) 75%
--------------------------------------------------------------------------------------------------------
(3) Treasury Notes (2 year) vs. (2) Treasury Notes (6-1/2-10 year) 75%
--------------------------------------------------------------------------------------------------------
Treasury Bonds vs. (2) 10 Yr. Agency 60%
--------------------------------------------------------------------------------------------------------
10 Yr. Agency Notes vs. 10 Yr. T-Notes 80%
--------------------------------------------------------------------------------------------------------
(2) 10 Yr. Agency Notes vs. (3) 5 Yr. T-Notes 75%
--------------------------------------------------------------------------------------------------------
(2) 10 Yr. Agency Notes vs. (3) 2 Yr. T-Notes 65%
--------------------------------------------------------------------------------------------------------
Iowa Corn Yield vs. Illinois Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Iowa Corn Yield vs. Indiana Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Iowa Corn Yield vs. Nebraska Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Iowa Corn Yield vs. Ohio Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Iowa Corn Yield vs. U.S. Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Illinois Corn Yield vs. Indiana Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Illinois Corn Yield vs. Nebraska Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Illinois Corn Yield vs. Ohio Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Illinois Corn Yield vs. U.S. Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Indiana Corn Yield vs. Nebraska Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Indiana Corn Yield vs. Ohio Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Indiana Corn Yield vs. U.S. Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Nebraska Corn Yield vs. Ohio Corn Yield 50%
--------------------------------------------------------------------------------------------------------
Nebraska Corn Yield vs. U.S. Corn Yield 70%
--------------------------------------------------------------------------------------------------------
Ohio Corn Yield vs. U.S. Corn Yield 70%
--------------------------------------------------------------------------------------------------------
* Both positions must be on the same side of the market (long or short).
--------------------------------------------------------------------------------------------------------
Crush Spread (Same Crop Year) Soybeans (September Forward) vs.
--------------------------------------------------------------------------------------------------------
Soybean Meal (October Forward) vs.
--------------------------------------------------------------------------------------------------------
Soybean Oil (October Forward) 85%
--------------------------------------------------------------------------------------------------------
Crush Spread
--------------------------------------------------------------------------------------------------------
(10) Soybeans
--------------------------------------------------------------------------------------------------------
vs. (11) Soybean Meal
--------------------------------------------------------------------------------------------------------
vs. (9) Soybean Oil 85%
--------------------------------------------------------------------------------------------------------
For the purpose of this paragraph, a crush spread is a position of 5,000
bushels of soybeans against one contract of soybean meal and one contract of
soybean oil or a ratio of contracts that conforms to generally accepted soybean
processor crush relationships. The number of crush spreads is limited to the
net positions within any of the commodities.
-------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------
Spread Spread Credit %
-----------------------------------------------------------------
1:1:1:4 DJTA(SM), DJUA(SM), DJIA(SM) vs. 85%
DJCA(SM)
-----------------------------------------------------------------
1:2 DJIA(SM) vs. DJCA(SM) 85%
-----------------------------------------------------------------
Ch4 Margins and Doposits
------------------------
(4) INTER-MARKET SPREADS. Inter-market spreads (involving the same commodity)
where both sides of the transaction are carried on the books of one member
firm shall be margined on the Chicago Board of Trade side as follows (SPAN-
does not currently recognize inter-market spreads):
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Spread Spread Credit %
------------------------------------------------------------------------------------------------------------
CBOT Wheat vs.Kansas City Board of Trade Wheat 80%
------------------------------------------------------------------------------------------------------------
CBOT Wheat vs. Minneapolis Grain Exchange Spring Wheat 70%
------------------------------------------------------------------------------------------------------------
Gold (100 oz.) vs. Comex Gold 50%
------------------------------------------------------------------------------------------------------------
(3) Kilo Gold vs. (1) Comex Gold 50%
------------------------------------------------------------------------------------------------------------
Silver (5000 oz.) vs. Comex Silver 50%
------------------------------------------------------------------------------------------------------------
(5) CBOT 1,000 Silver vs. (1) Comex 5,000 Silver 50%
------------------------------------------------------------------------------------------------------------
Other inter-market spreads:
------------------------------------------------------------------------------------------------------------
(2) CBOT T-Note (2 year) vs. 3 CME Eurodollar 70%
------------------------------------------------------------------------------------------------------------
(5) CBOT T-Note (2 year) vs. 2 FINEX T-Note (5 year) 80%
------------------------------------------------------------------------------------------------------------
(5) CBOT T-Note (5 year) vs. 2 FINEX T-Note (5 year) 80%
------------------------------------------------------------------------------------------------------------
(5) CBOT T-Note (5 year) vs. 2 FINEX T-Note (2 year) 80%
------------------------------------------------------------------------------------------------------------
(1) CBOT DJIA(SM) vs. (1) KCBOT Mini-Value Line 70%
------------------------------------------------------------------------------------------------------------
(5) CBOT DJIA(SM) vs. (2) Value Line 70%
------------------------------------------------------------------------------------------------------------
(1) CBOT DJIA(SM) vs. (10) Amex Diamonds $800
(per CBOT side)
------------------------------------------------------------------------------------------------------------
(5) INTER-MARKET SPREADS FOR CBOT AND MIDAM CONTRACTS
(a) Customers
--- ---------
For purposes of Regulations 431.03 and 431.05, any spread or other recognized
strategy specified therein may consist of a combination of positions in Chicago
Board of Trade and MidAmerica Commodity Exchange (MidAm) contracts, provided
that each MidAm position in such a combination is equivalent in size, and is in
the same commodity, as is specified with respect to a Chicago Board of Trade
position.
(b) Non-Clearing Members
--- --------------------
For purposes of Regulations 431.01, 431.03 and 431.06, any spread or other
recognized strategy specified therein may consist of a combination of positions
in Chicago Board of Trade and MidAmerica Commodity Exchange (MidAm) contracts,
provided that each MidAm position in such a combination:
- is equivalent in size, and is in the same commodity, as is specified
with respect to a Chicago Board of Trade position;
and
- is in a contract in which the non-clearing member has MidAm membership
privileges.
431.03A Margins - Spreads involving soybeans versus only crude soybean oil or
only soybean meal
or spreads involving crude soybean oil versus soybean meal do not meet the
requirements of Paragraph 4(a) of Regulation 431.03 and, therefore, do not
qualify for margins on one side only. 34R (08/01/94)
431.03B Margins - The Rules Committee was asked the following questions:
(1) Is it permissible for a carrying broker to maintain an account with a bank
where it is specified that the deposits therein are made at the request of
a particular client - such funds not necessarily being those of the client.
(2) Is it permissible to maintain such an account, limiting it to the amounts
deposited by such client.
The Committee is unanimously of the opinion that these practices are a
violation of the Association's
Ch4 Margins and Doposits
------------------------
minimum margin Rules and Regulations. They constitute the extending of
credit for margins. 200R (08/01/94)
431.04 Notice of Undermargined Omnibus Accounts - (See 285.05) (08/01/94)
431.05 Margin on Options - Under the provisions of Rule 431.00, the Board
hereby establishes that minimum margins for option transactions will be
determined by the *Standard Portfolio Analysis of Risk- (SPAN-) margin
calculations.
Maintenance margin will equal the maximum of:
(a) Market Risk Margin calculation
(b) Extreme Market Risk calculation
(c) Gross Short Option calculation
(d) Initial margins for each commodity are identified in Regulations
431.03(1), (2) and (3).
For all long option positions premium must be paid in full when the
position is initiated. See Regulations 1305.01, 1605.01, 2205.01, 2705.01,
2805.01, 2905.01, 3005.01, 3105.01, 3205.01, 3305.01, 3505.01, 3605.01,
3805.01, 42005.01, 4605.01, 4805.01 and 5205.01.
The values of the following policy variables will be determined by the
Board of Directors:
1. Normal range of futures price changes.
2. Normal range of implied volatility changes.
3. Intermonth spread margin for determining intermonth spread risk.
4. Extreme range of futures price changes.
5. Backup margin collection ratio for the Extreme calculation.
6. Gross short option assessment level. (07/01/00)
431.06 Margin on Options - Non-Clearing Members - - A non-clearing member who
makes his own option trades or who on the Floor gives his orders for option
trades which are exclusively for his account shall be subject solely to the
provisions of the *Standard Portfolio Analysis of Risk- margin (SPAN-).
Maintenance margin will equal the maximum of:
(a) Market Risk Margin calculation.
(b) Extreme Market Risk calculation.
(c) Gross Short option calculation.
For all long option positions premium must be paid in full when the position is
initiated. See Regulations 1305.01, 1605.01, 2205.01, 2705.01, 2805.01, 2905.01,
3005.01, 3105.01, 3205.01, 3305.01, 3505.01, 3605.01, 3805.01, 42005.01,
4605.01, 4805.01 and 5205.01. (07/01/00)
*"SPAN-" and "Standard Portfolio Analysis of Risk-" are trademarks of the
Chicago Mercantile Exchange. The Chicago Mercantile Exchange assumes no
liability in connection with the use of SPAN by any person or entity.
B. Inter-Market Option Spreads - (See 431.03) section 5 (04/01/00)
432.00 Customers' Securities - The improper use of a customer's securities is
inconsistent with just and equitable principles of trade. 211 (08/01/94)
433.00 Agreement for Use of Securities - An agreement between a member and a
customer, authorizing the member to pledge securities, either alone or with
other securities carried for the account of the customer, either for the amount
due thereon or for a greater amount, or to lend such securities, does not
justify the member in pledging or loaning more of such securities than is fair
and reasonable in view of the indebtedness of said customer to said member.
Ch4 Margins and Doposits
------------------------
No form of general agreement between a member and a customer shall warrant the
member in using securities carried for the customer for delivery on sales made
by the member for his own account, or for any account in which the firm or
corporation of said member or of any general or special partner therein is
directly or indirectly interested. 212 (08/01/94)
433.01 Construction of Rules 432.00 and 433.00 - A customer's wholly owned
securities and/or excess collateral (securities in excess of the approximate
amount required to enable the member carrying the account to finance it) must be
segregated in a manner which clearly identifies their ownership. The member
carrying the account shall keep a record of the location of such segregated
securities and the means by which their ownership may be identified. When such
securities are in the custody of another broker, the member carrying the account
shall keep such other broker fully informed at all times as to the specific
securities to be segregated. This Regulation applies to both odd lots and round
lots. (08/01/94)
Ch4 Transfer Trades/Exchange Service Fees
443.00 Exempt Transactions - The provisions of the Rules and Regulations
respecting member rates of commission and brokerage rates shall be superseded
not later than March 4, 1978. 219A (08/01/94)
444.01 Transfer Trades; Exchange of Futures for Physicals and Give-up
Transactions - - Transfer trades, or office trades, are defined and limited to
trades made upon the books of a commission merchant for the purpose of: (a)
transferring existing trades from one account to another within the same office
where no change in ownership is involved; or, (b) transferring existing trade s
from the office of one commission merchant to the office of another commission
merchant where no change in ownership is involved, provided that no such
transfer may be made for the purpose of evading and avoiding delivery on such
trades and provided further that if such transfer is made after receipt from the
Clearing House of a notice of intention to deliver applicable to such trades,
then the notice of intention to deliver must be passed through the Clearing
House along with the trades so transferred and the Clearing House shall
thereupon pass the notice of intention to deliver to the commission merchant to
whom such transfer has been made and delivery shall be taken by such commission
merchant; or, (c) exchanging futures for cash commodities or in connection with
cash commodities transactions; or, (d) to establish the prices of cash
commodities; or, (e) correcting errors on cleared trades, provided the original
trade documentation confirms the error and the special clearing code or screen
designated by the Board of Directors has been used to identify these transfers;
or (f) transferring trades executed on behalf of another commission merchant
from the account of the executing commission merchant to the account of the
other commission merchant customer where no change of ownership is involved,
provided that the special clearing code or screen designated by the Board of
Directors has been used to identify these transfers. The Business Conduct
Committee ("BCC") may, in its discretion, upon written request, exempt a
transfer trade from the requirements of this provision providing that the
transfer trade is made for the purpose of combining the positions held by two or
more commodity pools which are operated by the same commodity pool operator and
traded by the same commodity trading advisor, pursuant to the same strategy,
into a single account so long as the transfer does not result in the liquidation
of any open positions, and the pro rata allocation of interests in the
consolidating account does not result in more than a de minimize change in the
value of the interest of any pool participant and such other transfers as the
BCC, in its discretion, shall exempt in connection with or as a result of, a
merger, asset purchase, consolidation or similar non-recurring transaction
between two or more entities where one or more entities become the successor in
interest to one or more other entities.
Give-up transactions must be transferred in accordance with the procedure
provided in subparagraph (f) above. In the case of give-up transactions, the
commission merchant ("executing commission merchant") executing a trade on
behalf of another commission merchant (the "carrying commission merchant")
(including such carrying commission merchant's customers) must submit the trade
to the Clearing House for clearing, and remains responsible for the clearing and
settlement of such trade as prescribed by the Clearing House. Executing
commission merchants and carrying commission merchants must utilize an automated
invoicing system for commission payments resulting from give-up transactions, as
determined by the Board of Directors. Notwithstanding the foregoing, the
executing commission merchant, carrying commission merchant and, as applicable,
the customer on the account at the carrying commission merchant for which the
trade is executed, may by agreement set out their respective obligations and
financial responsibility to one another relating to the transfer of the trade.
Exchange of futures in connection with cash commodity transactions or of futures
for cash commodities may be made at such prices as are mutually agreed upon by
the two parties to the transaction. All transactions involving exchanges of
futures in connection with cash commodity transactions or of futures for cash
commodities transactions involving CBOE 50 and CBOE 250 Stock Index futures
shall be priced within the day's trading range.
All transfer trades made between the offices of two commission merchants and all
office trades made in connection with cash commodity transactions or the
exchange of futures for cash commodities shall be
Ch4 Transfer Trades/Exchange Service Fees
-----------------------------------------
designated by proper symbol as transfer or office trades and must be cleared
through the Clearing House in the regular manner.
Transfer trades must be made at the same price or prices which appear on the
books of the transferring commission merchant, and the transfer must also show
the date when such trade or trades were originally made; provided, however, that
those transfers involving a debtor as defined by and in accordance with
Regulation 272.02 shall retain the original trade date for purposes of delivery
but shall be entered on the books of the transferee at the settlement price on
the day of the transfer. In addition, each party to transfer trade transactions
shall file with the Clearing House a memorandum stating the nature of the
transaction, whether the transaction has resulted in a change of ownership, the
kind and quantity of cash commodity, if any is involved, the kind, quantity and
price of the commodity future, the name of the opposite Clearing member, if any,
and such other information as the Clearing House may require. 1809A (09/01/98)
444.01A Transfer Trades and Inter-Market Spreads - - Owing to the fact that
some questions have arisen as to what may properly be handled in the way of
give-ups, as office trades or transfer trades, particularly in connection with
the new Commodity Exchange Act, the Directors have found it necessary to clarify
this situation with certain interpretations which will be mailed to all members
shortly. In the meantime, there is one point which seems important because of
the past custom of the trade, and we wish to call attention to it. In case a
house has spread orders between markets at a guaranteed difference, such as
buying Winnipeg or Minneapolis or Kansas City and selling Chicago at a fixed
difference, it has been customary in the past in the event they found some other
house going the other way at the same difference to exchange futures in the two
markets in order to consummate the spread. In other words, this was done by
give-ups rather than by pit executions. Under the new interpretation, such a
give-up is not permissible, inasmuch as it involves a change of ownership and is
not a give-up against a cash transaction, as interpreted by the Commodity
Exchange Act or the Board of Trade Rules. Accordingly, it will not be
permissible to exchange futures in the form of give-ups under such
circumstances, which will compel the actual filling of these limited spreads by
means of pit executions.
While this appears to work a certain amount of hardship, it seems to be required
in order to conform to the law and to the Rules of the Association; and,
accordingly, attention is directed to it in order to avoid possible confusion
where spreads are being worked between two markets. (08/01/94)
444.01B Prohibition on Exchange of Futures for Cash Commodities Involving
Multi-Parties - The exchange of futures for cash commodities or in connection
with cash commodity transactions may only occur when the buyer of the futures
contracts is the seller of the cash commodity and the seller of the futures
contracts is the buyer of the cash commodity. The transaction must be submitted
to the clearing house by a clearing firm acting on its own behalf or for the
beneficial account of a customer who is a party to the transaction. (08/01/94)
444.02 Clearance of Exchanges of Futures for Physicals Transactions - With
respect to the futures portion of an exchange of future for physical
transaction, clearing firm on opposite sides of the transaction must
subsequently approve the terms of the transaction, including the clearing firm
(division), price, quantity, commodity, contract month and date prior to
submitting the transaction to the Clearing House. (08/01/94)
444.03 Transfer Trades in a Delivery Month - During the delivery month and 2
business days prior to the first delivery day, (or in the case of crude
petroleum during position month) transfer trades for the purpose of offsetting
existing positions where no change of ownership is involved are prohibited when
the date of execution of the position being transferred is not the same as the
transfer date. Positions carried at different houses for the same owner 2
business days prior and to a delivery month and thereafter (or in the case of
crude petroleum during position month) are required to be offset in the pit or
through the normal delivery process. The receiving firm has the responsibility
to assure compliance with this regulation. (08/01/94)
450.00 Exchange Service Fees -
(a) members, membership interest holders and member firms. Each Full and
Associate Member, Membership Interest Holder and member firm shall be
obligated to pay to the Association, at such times and in such manner as
the Board may prescribe, a transaction fee of 1.5 cents (applicable to
Ch4 Transfer Trades/Exchange Service Fees
-----------------------------------------
Members and member firms) or 2 cents (applicable to Membership Interest
Holders) for each contract (1) for such Member's or Membership Interest
Holders's own account; (2) for such member firm's account; and (3) executed
by such Member or Membership Interest Holder on the Floor of the
Association as a floor broker for the account of others. The maximum of
fees paid hereunder per year by any Full or Associate Member in respect to
contracts described in categories (1) and (3) above, shall be $10,000.
(b) non-member. Effective on the date set by Regulation adopted by the Board,
each member or registered eligible business organization handling the
funds of non-member customers shall include, in the statements to each
customer, an Exchange Service Fee of 50 cents for each Board of Trade
futures contract bought, sold or delivered for the account of the non-
member customer. All Exchange Service Fees collected from non-member
customers shall be remitted by the member or registered eligible business
organization to the Association at such times and in such manner as the
Board may prescribe. The Exchange Service Fees remitted to the Association
in respect to nonmember transactions shall be expended only for purposes
determined by the Board to be of benefit to non-member customers and other
market participants.
(c) revenue. The Board shall have the authority in its discretion to suspend
member transaction fees, fees on the execution of trades and non-member
Exchange Service Fees at any time during a fiscal year upon making a
determination that year-to-date Exchange revenues have attained a
sufficient level to render the further collection of such fees unwarranted.
(d) reports. Each member or registered eligible business organization subject
to the provisions of this Rule shall submit to the Association such reports
as the Board may deem necessary for the administration of this Rule.
(e) enforcement. No member or registered eligible business organization shall
be obligated to the Association for the payment of Exchange Service Fees
attributable to non-member transactions except to the extent that such fees
are collected from non-member customers; provided, however, that each
member or registered eligible business organization responsible for the
collection of Exchange Service Fees shall make a bona fide and diligent
effort to collect such amounts and shall not have the right, without prior
approval of the Association, to release or forgive any indebtedness of a
non-member to the Association for Exchange Service Fees. In the event of
delinquencies in the payment of Exchange Service Fees by a non-member, the
Board in its discretion may order that further trading in the accounts of
such non-member shall be for liquidation only until the indebtedness is
paid.
(f) special assessments. This Rule shall not be construed to supersede Rule
2200.00 in any way nor to abrogate the responsibility and right of the
Board to levy such additional assessments, charges or fees pon the
membership as may be necessary to meet the obligations of the Association.
136 (04/01/98)
450.01 Exchange Service Fees - Payment of the Exchange Service Fee in respect
to transactions executed by a Member, Membership Interest Holder, or Delegate on
the Floor as a floor broker for the account of others, under Rule 450.00, must
be remitted to the Exchange's Accounting Department within thirty days
commencing from the date of the Exchange's invoice to the member. Failure to pay
the invoiced transaction fees within the prescribed thirty days may result in
the suspension (pursuant to the provisions of Exchange Regulation 5200.06) of
the defaulting member's membership privileges, including floor access and the
benefit of member transaction fees.
Payment of the Exchange Service Fee in respect to transactions for Members'
Membership Interest Holders' or Delegates' own accounts or Member firms'
accounts, under Rule 450.00, must be remitted to the Exchange's Accounting
Department by the member firm clearing such transactions within twenty-one days
commencing from the date of the Exchange's invoice to such clearing member firm.
Payment of the Exchange Service Fee in respect to non-member transactions under
Rule 450.00 executed on or after May 1, 1974 shall be as follows:
(1) Not later than the last business day of each month, each member or
registered eligible business
Ch4 Transfer Trades/Exchange Service Fees
-----------------------------------------
organization handling the funds of non-member customers shall submit to the
Treasurer of the Association a report, in a form prescribed by the
Association showing the number of non-member transactions (whether
purchases, sales or deliveries) executed on change during the preceding
month, and the identity of non-members more than 60 days in arrears in the
payment of Exchange Service Fees.
Such report should be accompanied by the remittance of all Exchange Service
Fees collected since the last remittance date.
(2) As soon as practicable following the end of each fiscal year, the
Association shall compute the total amount of Exchange Service Fees
received by it in respect to non-member transactions. If such total exceeds
all assessments paid by members under Rule 2200.00 and all Exchange Service
Fees upon memberships under Rule 450.00 in the same fiscal year, the excess
shall be accumulated in a segregated contingency reserve fund. The reserve
fund may only be dispursed by separate action of the Board and then only
for those purposes identified in Rule 450.00.
(3) No member or registered eligible business organization shall identify on
its statements to nonmember customers any charge as an "Exchange Service
Fee" unless the amount shown is actually due and payable to the Association
under Rule 450.00. (08/01/00)
450.01A Exchange Service Fees - BE IT RESOLVED, that Regulation 450.01 be
adopted with effective date of April 1, 1974 for Exchange Service Fees on member
transactions and May 1, 1974 for Exchange Service Fees on non-member
transactions. (08/01/94)
450.01B Options Transactions - BE IT RESOLVED, that pursuant to the Board's
authority set forth in Rule 450.00 (a) and (b), the collection and payment of
all member and non-member transaction fees that otherwise would be applicable to
transactions in options on Treasury Bond futures shall be waived for any such
transactions made prior to March 31, 1983. (08/01/94)
450.01C Exchange Service Fees - BE IT RESOLVED, that pursuant to the Board's
authority set forth in Rule 450.00 (a) ane (b) the collection and payment of all
non-member transaction fees that otherwise would be applicable to transactions
in Major Market Index or AMEX Market Value Index futures contracts shall be
waived to the extent of forty eight cents per contract for the account of a
member or member firm of the American Stock Exchange. (08/01/94)
450.02 Member's Own Account and Member Firm's Account - For the purpose of
implementing Rule 450.00, the terms "member's own account" in subsection (a)(1)
and "member firm's account" in subsection (a)(2) shall refer only to those
commodity futures or commodity options trading accounts that are wholly owned by
and held in the name of one or more members, member firms, or entities which are
wholly-owned by one or more members or member firms or which wholly own a member
firm. No other direct or indirect affiliate of a member firm shall be entitled
to member transaction fees. The term "member firm" shall refer only to a firm
registered with the Exchange pursuant to Regulation 230.02. An account owned by
and held in the name of a non-member individual who is a shareholder, partner,
employee, director or officer of a member firm shall not be considered a member
firm's account. An account owned by and held in the name of a non-member spouse
or other relative of a member shall not be considered a member's account. In
addition, for the purpose of Rule 450.00, a commodity futures or commodity
options trading account placed in trust shall be deemed a "member's own account"
if the following are true: (1) the member is the sole settlor of the trust; (2)
the member is one of the trustees of the trust and as such trustee, has sole
control over the investment-making decision of the trust; (3) the beneficiaries
of the trust include only the member, the member's spouse and/or the member's
descendants; (4) the trust declaration expressly incorporates the Rules and
Regulations of the Exchange, as may be amended; (5) the interest in the trust
that inures to the beneficiaries of the trust shall be subject to all Rules and
Regulations of the Exchange, as may be amended; and (6) the non-member trustee,
if any, expressly agrees in the trust declaration, to be subject to all Rules
and Regulations of the Exchange, as amended. The member must provide to the
Exchange, via the Member Services Department, a copy of the trust declaration
creating the trust described in the preceding sentence as well as any amendments
thereto along with a letter from an attorney stating that in the attorney's
opinion, the trust created is designed to achieve the estate planning objectives
of the member. Upon the member's death or if the
Ch4 Transfer Trades/Exchange Service Fees
-----------------------------------------
member is adjudged incompetent, any commodity futures or commodity options
trading account placed in trust pursuant to this section by such member will be
treated as a non-member trading account and will be subject to Exchange Service
Fee set forth in Rule 450.00(b). (07/01/99)
450.03 Exchange Service Fees for Professional Trading Firms -- (a) In
addition to the Exchange Service Fee assessed pursuant to Rule
450.00(a), any member firm that is or should be registered under
Regulation 230.02(6) and that is not wholly-owned by members or member
firms shall also be obligated to pay to the Association, at such times
and in such manner as the Board may prescribe, an additional
transaction fee of 3.5 cents for each contract for such member firm's
account. For the purpose of the previous sentence, "members" shall
mean those individuals who own or have delegated to them any of the
following memberships or membership interests: Full, Associate, COM or
IDEM.
(b) This Regulation 450.03 shall not apply to those member firms whose
employee-members(s) personally execute(s), on the trading floor and/or
on the Project A electronic trading system for the eligible business
organization's proprietary account, at least five hundred thousand
(500,000) contracts in its first year as a member firm of the Exchange
and at least 1 million (1,000,000) contracts for each calendar year
thereafter. (10/01/99)
450.04 Exchange Service Fees - Adjustments - Exchange Service Fee adjustments
may be granted to or required of member firms which have made
overpayments or underpayments to the Exchange as a result of the
incorrect identification of member or non-member accounts. However,
such adjustments will not be made or required for any time period
which is earlier than five years before the month-end preceding the
date when a rebate request is made by the firm or which is earlier
than five years before the end of the audit period selected by the
Exchange. Interest and/or costs may be assessed in accordance with
policies established by the Regulatory Compliance Committee.
(01/01/99)
Ch4 Adjustments
460.01 Errors and Mishandling of Orders - (See 350.04) (08/01/94)
460.02 Checking and Reporting Trades - (See 350.02) (08/01/94)
460.03 Failure to Check Trades - (See 350.01) (08/01/94)
460.04 Price of Execution Binding - (See 331.01) (08/01/94)
Ch4 Customer Orders
465.01 Records of Customers' Orders - Immediately upon receipt in the sales
office of a customer order each member or registered eligible business
organization shall prepare a written record of the order. It shall be dated and
time-stamped when the order is received and shall show the account designation,
except that in the case of a bunched order the account designation does not need
to be recorded at that time if the order qualifies for and is executed pursuant
to and in accordance with CFTC Regulation 1.35(a-1)(5). The order shall also be
time-stamped when it is transmitted to the Floor of the Exchange and when its
execution, or the fact that it is unable to be executed, is reported from the
Floor of the Exchange to the sales office. All time-stamps required by this
paragraph shall show the time to the nearest minute.
Immediately upon receipt on the Floor of the Exchange of a customer order, each
member or registered eligible business organization shall prepare a written
record of the order. It shall be dated and time-stamped when the order is
received on the Floor and shall show the account designation, except that in the
case of a bunched order the account designation does not need to be recorded at
that time if the order qualifies for and is executed pursuant to and in
accordance with CFTC Regulation 1.35(a-1)(5). The order shall also be time-
stamped:
(a) when it is transmitted to the floor broker if it is not transmitted
immediately after it is received on the Floor, and
(b) if the written order is transmitted to the floor broker, when the order is
received back from the floor broker, or
(c) if the order is transmitted to the floor broker verbally or by hand
signals, when a report of its execution, or the fact that it is unable to
be executed, is received from the floor broker.
Only time-stamps which are specified by the Exchange and synchronized with the
Exchange Floor master clock may be used on the Exchange Floor.
It shall be an offense against the Association to manipulate or tamper with any
time-stamp on the Exchange Floor, so as to put it out of synchronization with
the master clock. Records of customer orders executed through the Exchange's
Project A system facility shall be governed by 9B.20.
Any errors on written records of customer orders prepared on the Floor of the
Exchange may be corrected by crossing out the erroneous information without
obliterating or otherwise making illegible any of the originally recorded
information. (07/01/99)
465.02 Application and Closing Out of Offsetting Long and Short Positions -
(a) APPLICATION OF PURCHASES AND SALES. Any commission merchant, subject to the
Rules of the Association, who
(1) Shall purchase any commodity for future delivery for the account of
any customer (other than the "Customers' Account" of another
commission merchant) when the account of such customer at the time of
such purchase has a short position in the same future of the same
commodity on the same market, or
(2) Shall sell any commodity for future delivery for the account of any
customer (other than the "Customers' Account" of another commission
merchant) when the account of such customer at the time of such sale
has a long position in the same future of the same commodity on the
same market, or
(3) Shall purchase a put or call option for the account of a customer when
the account of such customer at the time of such purchase has a short
put or call option position in the same option series as that
purchased, or
(4) Shall sell a put or call option for the account of a customer when the
account of such customer at the time of such sale has a long put or
call option position in the same option series as that sold
Ch4 Customer Orders
-------------------
shall on the same day apply such purchase or sale against such previously
held short or long futures or options position, as the case may be, and
shall promptly furnish such customer a purchase and sale statement showing
the financial result of the transactions involved.
(b) CUSTOMERS'S INSTRUCTIONS. In all instances wherein the short or long
futures or options position in such customer's account immediately prior to
such offsetting purchase or sale is greater than the quantity purchased or
sold, the commission merchant shall apply such offsetting purchase or sale
to such portion of the previously held short position as may be specified
by the customer. In the absence of specific instructions from the customer,
the commission merchant shall apply such offsetting purchase or sale to the
oldest portion of the previously held long or short position, as the case
may be. Such instructions also may be accepted from any person who, by
power of attorney or otherwise, actually directs trading in the customer's
account unless the person directing the trading is the commission merchant
(including any partner thereof), or is an officer, employee, or agent of
the commission merchant. With respect to every such offsetting transaction
that, in accordance with such specific instructions, is not applied to the
oldest portion of the previously held futures or options position, the
commission merchant shall clearly show on the purchase and sale statement
issued to the customer in connection with the futures or options
transaction, that as a result of the specific instructions given by or on
behalf of the customer the transaction was not applied in the usual manner
i.e., against the oldest portion of the previously held futures or option
position. However, no such showing need be made if the commission merchant
has received such specific instructions in writing from the customer for
whom such an account is carried.
(c) IN-AND-OUT TRADES; DAY TRADES. Notwithstanding the provisions of paragraphs
(a) and (b) above, this Regulation shall not be deemed to require the
application of purchases or sales closed out during the same day (commonly
known as "in-and-out trades" or "day trades") against short or long
positions carried forward from a prior date.
(d) EXCEPTIONS. The provisions of this Regulation shall not apply to:
(1) purchases or sales of futures contracts for the purpose of covering
the granting of options on a contract market, if such purchases or
sales are accompanied by instructions and other evidence that such
futures contracts are cover for granted options.
(2) Purchases or sales constituting "bona fide hedging transactions" as
defined in C.F.T.C. Regulation 1.3(z).
(3) sales during a delivery period for the purpose of making delivery
during such delivery period if such sales are accompanied by
instructions to make delivery thereon, together with warehouse
receipts or other documents necessary to effectuate such delivery.
(4) Purchases or sales made in separate account of a commodity pool,
provided that:
(i) The trading for such pool is directed by two or more
unaffiliated commodity trading advisors acting independently,
each of which is directing the trading of a separate account;
(ii) The commodity pool operator maintains only such minimum control
over the trading for such pool as is necessary to fulfill its
duty to supervise diligently the trading for such pool;
(iii) Each trading decision made by a commodity trading advisor for
such pool is determined independently of all trading decisions
made by any other commodity trading advisor for such pool;
(iv) The purchases and sales for such pool directed by different
commodity trading advisors acting independently are executed by
open and competitive means on or subject to the rules of a
contract market; and
(v) No position held for or on behalf of separate pool accounts
traded in accordance with paragraphs (d) (4) (i), (d) (4) (ii),
(d) (4) (iii) and (d) (4) (iv) of this section may be closed
out by transferring such an open position from one of the
separate accounts to another
Ch4 Customer Orders
-------------------
account of the pool.
(5) Purchases or sales made in separate accounts owned by a customer or
option customer, provided that:
(i) Each person directing trading for one of the separate accounts
is unaffiliated with and acts independently from each other
person directing trading for a separate account;
(ii) Each person directing trading for one of the separate accounts,
unless he is the account owner himself, does so pursuant to a
power of attorney signed and dated by the customer, and which
includes, at a minimum, the name, address and telephone number
of the person directing trading and the account number over
which such power is granted;
(iii) Each trading decision made for each separate account is
determined independently of all trading decisions made for the
other separate account or accounts;
(iv) The purchases and sales for such accounts are executed by open
and competitive means on or subject to the rules of a contract
market;
(v) No position held for or on behalf of separate accounts traded in
accordance with paragraphs (d) (5) (i), (d) (5) (ii), (d) (5)
(iii) and (d) (5) (iv) of this section may be closed out by
transferring such an open position from one of the separate
accounts to another of such accounts; and
(vi) The customer or option customer and each person directing
trading for the customer or option customer provides the futures
commission merchant with written confirmation that the trading
and the operation of the customer's or option customer's
accounts will be in accordance with paragraphs (d) (5) (i), (d)
(5) (ii), (d) (5) (iii), (d) (5) (iv) and (d) (5) (v) of this
section. The written confirmation must be signed and dated, and
received by the futures commission merchant before it can avail
itself of this exception provided by this paragraph.
(6) Purchases or sales made in separate accounts of a p'|)''})' anted an
exemption in accordance with 425.05 and 495.05 of this chapter,
provided that:
(i) The purchases and sales for such accounts are executed in open
and competitive means on or subject to the rules of a contract
market; and
(ii) No position held for or on behalf of separate accounts traded in
accordance with this paragraph may be closed out by transferring
such an open position from one of the separate accounts to
another of such accounts.
(7) Purchases or sales held in error accounts, including but not limited
to floor broker error accounts, and purchases or sales identified as
errors at the time they are assigned to an account that contains other
purchases or sales not identified as errors and held in that account
("error trades"), provided that:
(i) Each error trade does not offset another error trade held in
the same account;
(ii) Each error trade is offset by open and competitive means on or
subject to the rules of a contract market by not later that the
close of business on the business day following the day the
error trade is discovered and assigned to an error account or
identified as error trade, unless at the close of business on
the business day following the discovery of the error trade,
the relevant market has reached a daily price fluctuation limit
and the trader is unable to offset the error trade, in which
case the error trade must be offset as soon as practicable
thereafter; and
(iii) No error trade is closed out by transferring such an open
position to another account also controlled by that same
trader.
Ch4 Customer Orders
-------------------
(8) Purchases or sales held in the separate accounts of a customer who has
granted discretionary authority to a futures commission merchant, an
associated person of a futures commission merchant, or a commodity
trading advisor trading separate trading programs which have been
marketed separately, provided that:
(i) The purchases or sales for such accounts are executed in open and
competitive means on or subject to the rules of a contract
market; and
(ii) No position held for or on behalf of separate accounts traded in
accordance with this paragraph (d)(8) may be closed out by
transferring such an open position from one of the separate
accounts to another of such accounts.
(e) With respect to the exception from the provisions of this section set forth
in paragraph (d) (5) of this section, if a futures commission merchant that
carries the separate accounts of a customer or option customer, or if an
associated person of such futures commission merchant, directs trading for
one of the separate accounts:
(1) the futures commission merchant must first furnish the customer or
option customer with a written statement disclosing that, if held
open, offsetting long and short positions in the separate accounts may
result in the charging of additional fees and commissions and the
payment of additional margin, although offsetting positions will
result in no additional market gain or loss. Such written statement
shall be attached to the risk disclosure statement required to be
provided to a customer or option customer under CFTC Regulation 1.55.
(07/01/94)
465.02A Exchange's No Position Stance on FCM's Internal Bookkeeping Procedures
- The Exchange takes no position regarding the internal bookkeeping procedures
of a commission merchant who, for the convenience of a customer, may hold
concurrent long and short position in the same commodity, month (and strike
price). This does not relieve the commission merchant of its responsibilities
under Regulation 465.02 of offsetting the position for Exchange reporting
purposes (i.e., Large Trader, Open Interest and Long Positions Eligible for
Delivery) and promptly furnishing the customer a purchase and sale statement
showing the financial result of the transactions involved. (08/01/94)
465.03 Orders and Cancellations Accepted On A 'Not Held' Basis - (See 337.01)
(08/01/94)
465.04 Records of Floor Order Forms - Clearing Members shall establish and
maintain procedures that will assure the complete accountability of all floor
order forms used on the Exchange Floor. Machine and handwritten orders are
required to be machine sequentially prenumbered and maintained by the firm in
sequential order. (08/01/94)
465.05 Floor Order Forms - All floor orders must be in a form approved by the
Floor Governors Committee or an employee of the Office of Investigations and
Audits designated by the Floor Governors Committee.
Floor order forms must be machine sequentially prenumbered and contain the
following machine preprinted information:
(1) the name of the Clearing Member;
(2) bracket designations,
(3) a space designated for the customer account number; and
(4) a space designated for the executing broker identification. (08/01/94)
465.06 Broker's Copy of Floor Orders - Upon request, a clearing firm must
provide its broker, in an expeditious and reasonable manner, with a copy of
every floor order he is asked to execute. (08/01/94)
465.07 Designation of Order Number Sequences - To facilitate Exchange
monitoring of order flow volume, the Exchange may prescribe particular sequences
of order form numbers for member firms to use in specified areas of the Exchange
Floor. (07/01/94)
Ch4 Customer Orders
-------------------
465.08 Post-Execution Allocation - All trades entered and executed in
accordance with CFTC Regulation 1.35(a-1)(5) regarding orders eligible for post-
execution allocation, must be allocated in sufficient time to meet the
requirements of the Board of Trade Clearing Corporation trade submission for the
trade date of the order. (07/01/99)
466.00 Orders Must be Executed in the Public Market - (See 332.00)
(08/01/94)
Ch4 Offices and Branch Offices
475.00 Offices and Branch Offices - Member firms and member sole proprietors may
establish offices other than main offices. All offices of member firms and
member sole proprietors and employees thereof shall be subject to the Rules and
Regulations of the Association, and shall be subject to the jurisdiction of the
Business Conduct Committee in connection therewith; provided, however, that the
Business Conduct Committee may exempt such offices and employees from any such
Rule or Regulation which is incompatible with, in conflict with or unrelated to
the functions performed by them. The term "branch office" shall include each
branch office or wholly-owned subsidiary of the member firm that solicits,
accepts, or services Commodity Futures Contracts or Options and/or is listed by
the member firm as a branch office with the National Futures Association.
A branch office must conduct business under the same name as the parent firm or
corporation. 129 (01/01/99)
Ch4 APs and Other Employees
480.01 APs - An Associated Person ("AP") is an employee of a member sole
proprietor or member firm who solicits, accepts or services business other than
in a clerical capacity in commodity futures and commodity options, and who has
been granted registration as an Associated Person ("AP") by the Commodity
Futures Trading Commission (CFTC) or the National Futures Association (NFA)
pursuant to the Commodity Exchange Act. (08/01/94)
480.02 Employers Responsible for APs - Employers, in all instances, shall be
responsible for the acts and omissions of their APs and branch office managers.
(08/01/94)
480.09 Other Employees - The Business Conduct Committee may require that the
name, remuneration, term of employment and actual duties of any employee of a
member or of a member firm shall be stated to the Committee, together with such
other information with respect to the employee as the Committee may deem
requisite. The Committee may, in its discretion, disapprove of said employment,
remuneration or term of employment. (08/01/94)
480.10 Supervision - Any willful act or omission by which a member fails to
ensure compliance with the rules, regulations and bylaws of the Association by
such member's partners, employees, agents or persons subject to his supervision
shall constitute an offense against the Association by the member.
Any willful act or omission by which a member firm fails to ensure compliance
with the rules, regulations and bylaws of the Association by such member firm's
partners, directors, officers, employees or agents shall constitute an offense
against the Association by the member firm. (07/01/95)
Ch4 Options Transactions
490.00 Application of Rules and Regulations - Unless specifically negated or
unless superseded, each Rule or Regulation of the Association pertaining to
transactions in future delivery contracts shall apply with equal force and
effect to transactions in options. (08/01/94)
490.02 Option Customer Complaints - Each commission merchant engaging in the
offer or sale of options pursuant to these Rules and Regulations shall, with
respect to all written option customer complaints and oral option customer
complaints which result in, or which would result in an adjustment to the option
customer's account in an amount in excess of one thousand dollars:
(1) Retain all such written complaints and make and retain written records
of all such oral complaints; and
(2) Make and retain a record of the date the complaint was received, the
employee who serviced the account, a general description of the matter
complained of, and what, if any, action was taken by the commission
merchant in regard to the complaint. (08/01/94)
490.03 Supervision Procedures - Each commission merchant engaging in the
offer or sale of options pursuant to these Rules and Regulations shall adopt and
enforce written procedures pursuant to which it will be able to supervise
adequately each option customer's account, including but not limited to, the
solicitation of such account; provided that, as used in this Regulation, the
term "option customer" does not include another commission merchant. (08/01/94)
490.03A Introducing Brokers Guaranteed by Member FCMs/Supervision Procedures-
The Board of Directors in a special polling held on Friday, February 3, 1984
approved the following Resolution of the Member Services Committee pursuant to
Regulation 490.03 of the Association.
WHEREAS, The Commodity Futures Trading Commission has provided by regulation
that introducing brokers operating pursuant to a guarantee agreement with an
FCM be permitted to solicit and/or accept orders for exchange-traded options
if the Exchange of which the guarantor FCM is a member has adopted rules
which govern the commodity option related activity of the guaranteed
introducing broker; and
WHEREAS, it is the desire of certain members to permit the solicitation
and/or acceptance of Chicago Board of Trade options by introducing brokers
guaranteed by a member FCM;
NOW THEREFORE, be it -
RESOLVED, that each Rule or Regulation of the Association pertaining to the
options sales practices of members or their employees shall apply with equal
force and effect to the options sales practices of introducing brokers who are
operating pursuant to a guarantee agreement with a member FCM and such member
FCM shall be fully responsible therefor, and that this Resolution shall remain
in effect until rescinded by a vote of the members or until such time as the
National Futures Association or other registered futures association adopts
rules which are approved by the Commodity Futures Trading Commission to govern
the commodity option related activity of such guaranteed introducing brokers.
(08/01/94)
490.05 Disclosure - Each commission merchant engaging in the offer or sale of
options pursuant to these Rules and Regulations shall enforce the following
requirements pertaining to disclosure statements:
(1) Prior to opening an options account for an options customer, each
commission merchant must furnish the options customer with a separate
written risk disclosure statement, as set forth and described in
Commodity Futures Trading Commission Regulation 33.7, and receive from
the options customer an acknowledgement, signed and dated by the
options customer, that he received and understood the disclosure
statement.
(2) Each disclosure statement and acknowledgement must be retained by the
commission merchant in accordance with applicable Regulations of the
Commodity Futures Trading Commission.
Ch4 Options Transactions
------------------------
(3) Prior to the entry into an options transaction pursuant to these Rules
and Regulations, each commission merchant or the person soliciting or
accepting the order therefor must provide each options customer with
all of the information required under the disclosure statement;
Provided, further, that the commission merchant must provide current
information to an options customer if the information provided
previously has become inaccurate.
(4) Prior to the entry into an options transaction pursuant to these Rules
and Regulations, each options customer or prospective options customer
shall, to the extent the following amounts are known or can reasonably
be approximated, be informed by the person soliciting or accepting the
order therefore of the amount of the premium, commissions, costs, fees
and other charges to be incurred in connection with the options
transaction, as well as the strike price and all costs to be incurred
by the options customer if the option is exercised; in addition, the
limitations, if any, on the transfer of an options customer's account
to a commission merchant other than the one through whom the options
transaction is to be executed shall also be provided in writing.
(5) For the purposes of this Regulation, a commission merchant shall not
be deemed to be an options customer. (08/01/94)
490.06 Promotional Material - Each commission merchant engaging in the offer
or sale of futures and options pursuant to these Rules and Regulations shall
promptly make available upon request to the Office of Investigations and Audits
all promotional material pertaining to trading in such futures and options.
For the purposes of this Regulation, the term "promotional material" includes:
(1) any text of a standardized oral presentation, or any communication for
publication in any newspaper, magazine or similar medium, or for
broadcast over television, radio, or other electronic medium, which is
disseminated or directed to a customer or prospective customer
concerning a commodity futures or option transaction;
(2) any standardized form of report, letter, circular, memorandum or
publication which is disseminated or directed to a customer or
prospective customer; and
(3) any other written material disseminated or directed to a customer or
prospective options customer for the purpose of soliciting a futures
or options order, including any disclosure statement. (08/01/94)
490.07 Sales Communication - Each commission merchant engaging in the offer
or sale of futures and options pursuant to these Rules and Regulations is
prohibited from making fraudulent or high-pressure sales communications relating
to the offer or sale of such futures and options. (08/01/94)
490.09 Reports by Commission Merchants - Each commission merchant shall make
and submit such reports showing options positions held by any of its customers,
in such form as may be required from time to time by the Office of
Investigations and Audits or the Business Conduct Committee. Specifically, and
without limiting the authority of the Office of Investigations and Audits or the
Business Conduct Committee under this Regulation, all information needed to
comply with Part 16 of the Commission's Regulations (17 CFR Part 16) may be
collected from any member. (08/01/94)
495.01 Position Limits in Options -
For the purpose of this regulation:
(i) An option contract's futures-equivalency shall be based on the prior
day's delta factor for the option series, as published by the Board
of Trade Clearing Corporation. For example, 8 long put contracts,
each with a delta factor of 0.5, would equal 4 futures-equivalent
short contracts.
(ii) Long futures contracts shall have a delta factor of +1, and short
futures contracts shall have a delta factor of -1.
(iii) Long call options and short put options shall have positive delta
factors.
(iv) Short call options and long put options shall have negative delta
factors.
(v) An eligible option/option or option/futures spread is defined as an
intra-month or inter-month
position in the same Chicago Board of Trade commodity in which the
sum of the delta factors is zero.
(a) Except as provided in Regulations 425.03, 425.04, 425.05, 495.03 and
495.04, the maximum positions which any person may own, control or carry
are as follows:
[Enlarge/Download Table]
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Futures-equivalent Position Limits Position Limit on the Number of
Net On the Same Side of the Market Option Contracts for All Months and Reportable Option
in All Months and All Strike Prices All Strike Prices Combined in Each Position in Any One Month
Option Contract Combined1 Option Category2 In Each Option Category2
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CBOT. Dow Jones Industrial 50,000 None 25
AverageTM Index
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U.S. Treasury Bonds None None 100
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1,000 oz. 20,000 None 50
Silver
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Long-Term Treasury Notes None None 50
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Medium Term U.S. Treasury Notes None None 50
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Long-Term Agency Notes 5,000 None 50
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Long-Term Municipal Bonds 5,000 None 50
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Short-Term Treasury Notes 5,000 None 50
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PCS Catastrophe Insurance/11 None 10,000 25
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Corn 9,000 3/4 None 50
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Soybeans 5,500 3/,5/ None 50
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Corn Yield Insurance/12 1,000 None 25
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Wheat 4,000 3/,6/ None 50
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Oats 1,500 3/,7/ None 50
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Rough Rice 750/8 None 50
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Soybean Oil 4,000 3/,9/ None 50
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Soybean Meal 4,000 3/,10/ None 50
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1/ Long futures contracts, long, call options, and short put options are
considered to be on the long side of the market while short futures
contracts, long put options, and short call options are considered to be on
the short side of the market. For each of the above commodities, the
futures-equivalents for both the options and futures contracts are
aggregated to determine compliance with the net same side position limits.
2/ Option categories are long call, long put, short call, and short put.
3/ A person may own or control additional options in excess of the futures-
equivalent limits provided that those option contracts in excess of the
futures-equivalent limits are part of an eligible option/futures spread.
4/ No more than 5,500 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
5/ No more than 3,500 futures equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
6/ No more than 3,000 futures equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
7/ No more than 1,000 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Ch4 Options Transactions
------------------------
Additional options contracts may be held as part of the option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
8/ No more than 500 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
9/ No more than 3,000 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
10/ No more than 3,000 futures-equivalent contracts net on the same side of the
market are allowed in a single month in all strike prices combined.
Additional options contracts may be held as part of option/option or
option/futures spreads between months within the same crop year provided
that the total of such positions, when combined with outright positions,
does not exceed the all-months combined limit. The futures-equivalents for
both the options and futures contracts are aggregated to determine
compliance with these net same side single month position limits.
11/ Specifications apply separately to Small Cap and Large Cap contracts in
each of the following PCS Catastrophe Insurance categories: National,
Eastern, Northeastern, Southeastern, Western, Midwestern, California.
12/ Specifications apply separately to each of the following Corn Yield
Insurance contracts: Iowa, Illinois, Indiana, Nebraska, Ohio, U.S.
Except for the interest of a limited partner or shareholder (other than the
commodity pool operator) in a commodity pool, ownership, including a 10% or more
financial ownership interest, shall constitute control over an account, except
as provided in Regulation 495.05.
The maximum positions which any person, as defined in Regulation 495.01 (b), may
own or control shall be as set forth herein. However, with respect to the
maximum positions which a member firm may carry for its customers, it shall not
be a violation of the limits set forth herein to carry customer positions in
excess of such limits for such reasonable period of time as the firm may require
to discover and liquidate the excess positions or file the appropriate hedge or
exemption statements for the customer accounts in question in accordance with
Regulations 425.03, 425.04, 495.03 and 495.04. For the purposes of this
regulation, a "reasonable period of time" shall generally not exceed one
business day for those positions that are not subject to the provisions of
Regulations 425.03, 425.04, 495.03 and 495.04.
However, for any option position that exceeds position limits for passive
reasons such as a market move or exercise assignment, the person shall be
allowed one business day to liquidate the excess position without being
considered in violation of the limits. In addition, if at the close of trading,
an option position exceeds position limits when evaluated using the previous
day's delta factors, but does not exceed the limits when evaluated using the
delta factors for that day's close of trading, then the position shall not
constitute a position limit violation.
(b) The word "Person" shall include individuals, associations, partnerships,
limited liability companies, corporations and trusts.
(c) The foregoing limits on positions shall not apply to bona fide hedging
positions which meet the requirements of Regulations 425.02, 425.03, 495.02
and 495.03, nor to positions subject to particular limits granted pursuant
to Regulations 425.04 and 495.04.
(d) The Board, or a Committee authorized by the Board, may direct any member or
registered eligible business organization owning, controlling or carrying a
position for a person whose total position as defined in subsection (e)
below exceeds the position limits as set forth in subsection (a) above or
as specifically determined pursuant to Regulations 425.03, 425.04, 495.03
or 495.04, to liquidate or otherwise reduce the position.
Ch4 Options Transactions
------------------------
(e) In determining whether any person has exceeded the position limits
specified in subsection (a) of this Regulation or those limits determined
pursuant to Regulations 425.03, 425.04, 495.03 or 495.04, or whether a
position is a reportable position as set forth in subsections (a) and (f)
herein, all positions in accounts for which such person by power of
attorney or otherwise directly or indirectly controls trading, except as
provided in Regulation 425.05, shall be included with the positions held by
such person. Such limits upon positions shall apply to positions held by
two or more persons acting pursuant to an expressed or implied agreement or
understanding, the same as if the positions were held by a single person.
(f) If a person owns, controls or carries an option position equal to or
greater than the number of contracts specified in subsection (a) above long
or short in any one month, then all such options and futures underlying
such options owned, controlled or carried by that person, whether above the
given level or not, shall be deemed reportable positions. Every member or
registered eligible business organization shall report each and every
reportable position to the Office of Investigations and Audits at such
times and in such form and manner as shall be prescribed by the Business
Conduct Committee.
(1) On or before the first day on which any position must be reported as
provided above, the member or registered eligible business
organization carrying the position must furnish to the Office of
Investigations and Audits a report, in the form, manner and content
prescribed by the Business Conduct Committee, identifying the owner of
the account for which the position must be reported and all persons
associated with the account as described in subsection (e) above.
(2) Every member or registered or registered eligible business
organization must report each and every reportable position and
provide the report required in subsection (1) above for each person
within any account carried on an omnibus basis, unless, upon
application of the member or registered eligible business organization
to the Business Conduct Committee, the nonmember omnibus account
specifically is approved to report directly to the Office of
Investigations and Audits. (07/01/00)
495.02 Economically Appropriate Hedging Positions in Options -
(a) General Definition. Economically appropriate hedging positions in options
shall mean positions in options on contracts for future delivery on this
Exchange, where such positions normally represent a substitute for
positions to be taken at a later time in a physical marketing channel, and
where they are economically appropriate to the reduction of risks in the
conduct and management of a commercial enterprise, and where they arise
from:
(1) The potential change in the value of assets which a person owns,
refines or merchandises or anticipates owning, refining or
merchandising.
(2) The potential change in the value of liabilities which a person owes
or anticipates incurring, or
(3) The potential change in the value of services which a person provides,
purchases or anticipates providing or purchasing.
Notwithstanding the foregoing, no positions of a person shall be classified
as economically appropriate unless their purpose is to offset price risks
incidental to that person's commercial cash or spot operations and such
positions are established and liquidated in an orderly manner in accordance
with sound commercial practices and unless the provisions of Regulation
495.03 have been satisfied.
(b) Enumerated Hedging Positions. For purposes of Regulation 495.03, the
definition of economically appropriate hedging positions in subsection (a)
above includes, but is not limited to, the following specific positions:
(1) Purchases of put options on futures contracts and sales of call options
on futures contracts, which do not exceed in quantity:
(i) Ownership of the same cash commodity by the same person; and
(ii) Fixed-price purchases of the same cash commodity by the same
person.
Ch4 Options Transactions
------------------------
(2) Sales of put options on futures contracts and purchases of call
options on futures contracts, which do not exceed in quantity:
(i) Fixed-price sales of the same cash commodity by the same person;
and
(ii) The quantity equivalent of fixed-price sales of the cash
products and derivative products of such commodity by the same
person.
(3) Sales and purchases of options on contracts for future delivery
described in subsections (b)(1) and (b)(2) may also provide
substitutes for the same or other quantities of a different cash
commodity, provided that the fluctuations in the value of the
commodity underlying the option contract are substantially related to
the fluctuations in the value of the actual cash position.
(c) Non-Enumerated Hedging Positions. The Board, or a Committee authorized by
the Board, may recognize positions other than those enumerated in
subsection (b) as economically appropriate hedging positions, in accordance
with the general definition of economically appropriate hedging in
Regulation 495.02(a), upon the filing of a satisfactory initial statement
in accordance with Regulation 495.03. Such positions may include:
(1) Short-hedging positions (long put options or short call options) of
unsold anticipated positions in the same cash commodity by the same
person;
(2) Long-hedging positions (long call options or short put options) of
unfilled anticipated requirements of the same cash commodity by the
same person;
(3) Short or long cross-hedging positions, provided that the fluctuations
in the value of the commodity underlying the option positions are
substantially related to the fluctuations in the value of the
anticipated cash positions; or
(4) Any other positions in options on futures contracts, including those
established under the concept of "delta-ratio hedging," under such
terms and conditions as the Board, or a Committee authorized by the
Board, may specify.
(d) Cash positions described in subsections (b) and (c) above shall not include
those positions or portions of positions which are bona fide hedging
positions in futures pursuant to Regulations 425.02 and 425.03. (07/01/94)
495.03 Reporting Requirements for Economically Appropriate Hedging Positions in
Options in Excess of Limits -
(a) Initial Statement. Every member or registered eligible business
organization which owns, controls, or carries positions on behalf of a
person who seeks classification of such positions as economically
appropriate hedging positions must file a statement satisfactory to
designated staff or a Committee authorized by the Board in order to
classify such positions as economically appropriate hedging positions
within the meaning of Regulation 495.02. The initial statement of the
member or registered eligible business organization filed on behalf of a
person shall be filed no later than 10 business days after the day on which
the person's position exceeds the speculative limit for each contract
specified in Regulation 495.01, and shall include:
(1) A description of the kinds of intended positions and their potential
size;
(2) A statement affirming that the kinds of intended positions are
economically appropriate hedging positions;
(3) With respect to the kinds of intended positions that are described as
non-enumerated hedging positions under Regulation 495.02(c), a
justification that the kinds of intended positions are consistent with
the definition of economically appropriate hedging positions within
the meaning of Regulation 495.02(a).
(b) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to this
Regulation, a supplemental statement which updates
Ch4 Options Transactions
------------------------
and confirms previous information shall be filed with designated staff or
a Committee authorized by the Board by every member or registered
eligible business organization owning, controlling or carrying such
person's positions. The supplemental statement shall be filed no later
than 10 business days after the day on which the person's position
exceeds the level specified in the most recent statement.
(c) A Committee or designated staff authorized by the Board will monitor
economically appropriate hedging positions. The initial and supplemental
statements prescribed in subsections (a) and (b) above must be submitted to
the Office of investigations and Audits and shall be maintained on a
confidential basis. The Board, or a Committee or designated staff
authorized by the Board, may request additional relevant information
necessary to ensure compliance with this Regulation 495.03. (09/01/99)
495.04 Exemptions From Position Limits in Options -
(a) The Board, or a Committee authorized by the Board, may establish
particular position limits on those positions of a person defined in
Regulation 495.01 as eligible option/option or option/futures spreads in
excess of the established limits.
In addition, the Board or a Committee authorized by the Board, may
establish, on a case by case basis, particular maximum position limits on
certain risk management positions in interest rate, stock index and
currency options, including:
(1) Long calls, or short puts whose underlying commodity value does not
exceed the sum of:
(i) Cash set aside in an identifiable manner, or any of the
following unencumbered instruments so set aside, with maturities
of less than 1 year: U.S. Treasury obligations; U.S. agency
discount notes; commercial paper rated A2 or better by Standard
& Poors and P2 or better by Moody's; banker's acceptances; or
certificates of deposit, plus any funds deposited as margin on
such positions; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
(2) Short calls whose underlying commodity value does not exceed the sum
of:
(i) The value of securities or currencies underlying the futures
contract upon which the option is based or underlying the option
itself and which securities or currencies are owned by the
trader holding such option position; and
(ii) The value of securities or currencies whose price fluctuations
are substantially related to the price fluctuations of the
securities or currencies underlying the futures contract upon
which the option is based or underlying the option itself and
which securities or currencies are owned by the trader holding
such option position.
(3) Long calls whose underlying commodity value does not exceed the sum
of:
(i) The value of equity securities, debt securities, or currencies
owned and being hedged by the trader holding such option
position, provided that the fluctuations in value of the
position used to hedge such securities are substantially related
to the fluctuations in value of the securities themselves; and
(ii) Accrued profits on such positions held at the futures commission
merchant.
Such risk management positions do not include those considered as
economically appropriate hedging positions as defined in Regulation 495.02.
(b) Requirements for Exemptions from Position Limits in Options. Every member
or registered eligible business organization which owns, controls or
carries positions on behalf of a person who wishes to make purchases or
sales of options on contracts for future delivery in excess of the position
limits then in effect, shall file statements on behalf of the person with
the Exchange, in such form and manner as shall be prescribed by the Board,
or by a Committee authorized by the Board, in conformity with the
requirements of this subsection.
(1) Initial Statement. Initial statements concerning the classification of
positions defined as eligible spreads or risk management positions,
for the purpose of subjecting such positions to particular
Ch4 Options Transactions
------------------------
position limits above those specified in Regulation 495.01(a). shall
be filed with designated staff or a Committee authorized by the Board
no later than 10 business days after the day on which such positions
exceed the position limits then in effect. Such statements shall
include information necessary to enable the Board, or a Committee
authorized by the Board, to make a determination that the particular
kinds of intended positions should be eligible for a higher position
limit, including, but not limited to:
(i) A description of the specific nature and size of positions in
options on contracts for future delivery and offsetting futures
positions, and affirmation that intended positions to be
maintained in excess of the limits set forth in Regulation
495.01(a) will be positions as set forth in Subsection (a) above.
(ii) In the case of risk management positions, information on the cash
portfolio being managed and/or any cash or cash market
instruments held in connection with the intended risk management
position, as well as other information relevant to the conditions
specified in subsection (a) above. Of particular interest are
whether the cash market underlying the option market has a high
degree of demonstrated liquidity relative to the size of
positions, and whether there exist opportunities for arbitrage
which provide a close linkage between the cash market and the
option market in question; and whether the positions are on
behalf of a commercial entity, including parents, subsidiaries or
other related entities, which typically buys, sells or holds the
underlying or a related cash market instrument.
(2) Supplemental Statements. Whenever there is a material change in the
information provided in the person's most recent statement pursuant to
this Regulation, a supplemental statement which updates and confirms
previous information shall be filed with designated staff or a
Committee authorized by the Board by every member or registered
eligible business organization owning, controlling or carrying such
person's position. The supplemental statement shall be filed no later
than 10 business days after the day on which the person's position
exceeds the level specified in the most recent statement.
(c) A Committee or designated staff authorized by the Board will monitor the
positions maintained by persons who have obtained particular position
limits under the provisions of this Regulation. The initial and
supplemental statements prescribed in subsections (b)(1) and (b)(2) above
must be submitted to the Office of Investigations and Audits and shall be
maintained on a confidential basis. The Board, or a committee or designated
staff authorized by the Board, may request additional relevant information
necessary to ensure compliance with this Regulation 495.04, and may, for
any good reason, amend, revoke or otherwise limit the particular position
limits established.
(d) The provisions of this Regulation 495.04 shall not apply to Soybean Futures
Options, Corn Futures Options, Wheat Futures Options, Soybean Oil Futures
Options, or Soybean Meal Futures Options traded on the Exchange. (09/01/99)
495.06 Position Accountability for U.S. Treasury Bond Futures Options - A person
as defined in Regulation 495.01(b), who owns or controls a combination of
options and underlying futures contracts that exceed 10,000 futures-equivalent
contracts net on the same side of the market in all months and strike prices
combined or 25,000 option contracts for all months and all strike prices
combined in each option category as defined in Regulation 495.01(a) shall
provide, in a timely manner upon request by the Association, information
regarding the nature of the position, trading strategy, and hedging information
if applicable. In addition, such positions must be initiated and liquidated in
an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (08/01/94)
Ch4 Options Transactions
------------------------
495.07 Position Accountability for Long-Term and Medium Term Treasury Note
Futures Options - - A person as defined in Regulation 495.01(b), who owns or
controls a combination of options and underlying futures contracts that exceed
7,500 futures-equivalent contracts net on the same side of the market in all
months and strike prices combined or 20,000 option contracts for all months and
all strike prices combined in each option category as defined in Regulation
495.01(a) shall thereby be subject to the following provisions:
- Such person shall provide, in a timely manner upon request by the
Association, information regarding the nature of the position, trading
strategy, and hedging information if applicable.
- Such person automatically shall consent, when so ordered by the
Association acting in its discretion, not to increase further the
position in Long-Term Treasury Note contracts or Medium-Term Treasury
Note contracts which exceeds the above-referenced 7,500 or 20,000
contract level.
- Such positions must be initiated and liquidated in an orderly manner.
For purposes of this regulation, all positions in accounts for which a person,
by power of attorney or otherwise, directly or indirectly controls trading shall
be included with the positions held by such person. The provisions of this
regulation shall apply to positions held by two or more persons acting pursuant
to an expressed or implied agreement or understanding, the same as if the
positions were held by a single person.
Nothing herein shall limit the jurisdiction of the Association. (08/01/94)
[Enlarge/Download Table]
=========================================================================================================
Chapter 21
30-Day Fed Fund Futures
=========================================================================================================
Ch21 Trading Conditions........................................................................
2101.01 Authority....................................................................
2102.01 Application of Regulation....................................................
2104.01 Unit of Trading..............................................................
2105.01 Months Traded In.............................................................
2106.01 Price Basis..................................................................
2107.01 Hours of Trading.............................................................
2108.01 Trading Limits...............................................................
2109.01 Last Day of Trading..........................................................
2109.02 Liquidation During the Delivery Month........................................
2110.01 Margin Requirements..........................................................
2112.01 Position Limits and Reportable Positions.....................................
2113.01 Strip Transactions...........................................................
Ch21 Delivery Procedures.......................................................................
2136.01 Standards....................................................................
2142.01 Delivery on Futures Contracts................................................
2147.02 Payment......................................................................
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Chapter 21
30-Day Fed Fund Futures
================================================================================
Ch21 Trading Conditions
2101.01 Authority - (See Rule 1701.00) (10/01/94)
2102.01 Application of Regulation - Futures transactions in 30-Day Fed Fund
futures contracts shall be subject to the general rules of the Association as
far as applicable and shall also be subject to the regulations contained in this
chapter, which are exclusively applicable to trading in 30-Day Fed Fund futures.
(10/01/94)
2104.01 Unit of Trading - The unit of trading shall be interest on Fed funds
having face value of $5,000,000 or multiples thereof for one month calculated on
a 30-day basis at a rate equal to the average overnight Fed funds rate for the
contract month. (10/01/94)
2105.01 Months Traded In - Trading shall be for delivery in the current
calendar month, and in the following twenty-four calendar months, and in the
March, June, September, and December cycle months for a forty-two month period
beginning with the first such cycle month following the last spot month,
provided however that the Exchange may determine not to list a contract month.
(10/01/94)
2106.01 Price Basis - Prices will be quoted on an index basis, i.e., 100 minus
the monthly average overnight Fed funds rate (e.g., a rate of 6.50% is quoted at
93.50). Minimum price fluctuations shall be in increments of one-half of one-
hundredth of one percent of five million dollars on a 30 day basis ($20.835 per
one-half basis point), rounded up to the nearest cent. (07/01/99)
2107.01 Hours of Trading - The hours of trading for future delivery in 30-Day
Fed Fund futures shall be as determined by the Board. On the last day of trading
in an expiring future, the closing time for such future shall be 2:00 p.m.
Chicago time subject to the otherwise applicable provisions of the second
paragraph of Rule 1007.00. The market shall be opened and closed for all months
simultaneously or in such other manner as the Regulatory Compliance Committee
shall direct. (10/01/94)
2108.01 Trading Limits - (See Regulation 1008.01) (10/01/94)
2109.01 Last Day of Trading - The last day of trading shall be the last
business day of the delivery month. (10/01/94)
2109.02 Liquidation During the Delivery Month - After trading in contracts for
future delivery in the current delivery month has ceased, in accordance with
Regulation 2109.01 of this chapter, outstanding contracts for such delivery
shall be liquidated by cash settlement as prescribed in Regulation 2142.01.
(10/01/94)
2110.01 Margin Requirements - (See Regulation 431.03). (10/01/94)
2112.01 Position Limits and Reportable Positions - (See Regulation 425.01).
(10/01/94)
2113.01 Strip Transactions - A 30-Day Fed Fund futures strip transaction
involving the simultaneous purchase or sale of an equal amount of futures
contract months at a differential to the previous settlement prices is permitted
on this Exchange provided:
1. that each month of the strip is for the same account. Provided that,
when an order has been executed in the wrong month, and the erroneous
transaction has been placed in the broker's or firm's error account,
the error may be corrected by a spread transaction in which one leg of
the spread offsets the position in the error account and the other leg
is the correct execution of the order. Provided further that the
liability of the floor broker or FCM shall be determined in accordance
with Regulation 350.04.
2. that all months of the strip are priced at prices within the daily
trading limits specified in Regulation 1008.01.
Ch21 Trading Conditions
-----------------------
3. that the strip is offered by public outcry in the pit assigned to 30-
Day Fed Fund futures.
4. that the transaction shall be reported, recorded and publicized as a
strip.
5. that when such transactions are executed simultaneously, the executing
member on each side of the transaction shall designate each part of
the trade as a strip on his cards or order by an appropriate word or
symbol clearly identifying each part of such transactions.
Brokers may not couple separate orders and execute them as a strip, nor may a
broker take one part of a strip for his own account and give the other part to a
customer on an order. (10/01/94)
Ch21 Delivery Procedures
2136.01 Standards - The contract grade shall be 100 minus the average daily
Fed funds overnight rate for the delivery month. The average daily Fed funds
overnight rate is a simple average of the daily Fed funds overnight rates as
determined by the Federal Reserve Bank of New York. This simple average will be
rounded to the nearest tenth of a basis point and rounded up on the case of a
tie. Subsequently, the simple average will be rounded to the full or one-half
basis point.
The following is an example of the rounding methodology;
The tenth of a basis point value will be rounded as follows:
a. The following values will round down to the nearest basis point:
.00001
.00002
b. The following values will round up to one-half of one basis point:
.00003
.00004
c. A value of .00005 will settle as is.
d. The following values will round down to one-half of one basis point:
.00006
.00007
e. The following values will round up the nearest basis point:
.00008
.00009
For days for which the Federal Reserve Bank of New York does not compute a rate
(e.g. weekends and holidays), the rate shall be the rate determined on the last
business day for which a rate was determined. (12/01/95)
2142.01 Delivery on Futures Contracts - Delivery against 30-Day Fed Fund
futures contracts shall be made by cash settlement through the Clearing House
following normal variation margin procedures. The final settlement price will be
calculated on the business day that the Federal Reserve Bank of New York
releases the overnight Fed funds rate for the last day of trading. The final
settlement price shall be 100 minus the average daily Fed funds overnight rate
for the delivery month. On the last day of trading open contracts will be marked
to market based on the closing futures price. A final mark to market will be
made on the day the final settlement price is determined. (10/01/94)
2147.02 Payment - (See 1049.04) (10/01/94)
[Enlarge/Download Table]
================================================================================================
Chapter 22
Long-Term Municipal Bond Index Futures Options
================================================================================================
Ch22 Trading Conditions.................................................................
2201.00 Authority...............................................................
2201.01 Application of Regulations..............................................
2202.01 Nature of Long-Term Municipal Bond Index Futures Put Options............
2202.02 Nature of Long-Term Municipal Bond Index Futures Call Options...........
2203.01 Trading Unit............................................................
2204.01 Striking Prices.........................................................
2205.01 Payment of Option Premium...............................................
2206.01 Option Premium Basis....................................................
2207.01 Exercise of Option......................................................
2208.01 Expiration of Option....................................................
2209.01 Months Traded In........................................................
2210.01 Trading Hours...........................................................
2211.01 Position Limits and Reportable Positions................................
2212.01 Margin Requirements.....................................................
2213.01 Last Day of Trading.....................................................
2214.01 Option Premium Fluctuation Limit........................................
2215.01 Disclaimer..............................................................
================================================================================
Chapter 22
Long-Term Municipal Bond Index Futures Options
================================================================================
Ch22 Trading Conditions
2201.00 Authority - (See Rule 2801.00) (10/01/94)
2201.01 Application of Regulations - Transactions in put and call options on
Long-Term Municipal Bond Index futures contracts shall be subject to the general
rules of the Association as far as applicable and shall also be subject to the
regulations contained in this Chapter which are exclusively applicable to
trading in put and call options on Long-Term Municipal Bond Index futures
contracts. (See Rule 490.00.) (10/01/94)
2202.01 Nature of Long-Term Municipal Bond Index Futures Put Options - The
buyer of one (1) Long-Term Municipal Bond Index futures put option may exercise
his option at any time prior to expiration (subject to Regulation 2207.01), to
assume a short position in one (1) Long-Term Municipal Bond Index futures
contract of a specified contract month at a striking price set at the time the
option was purchased. The seller of one (1) Long-Term Municipal Bond Index
futures put option incurs the obligation of assuming a long position in one (1)
Long-Term Municipal Bond Index futures contract of a specified contract month at
a striking price set at the time the option was sold, upon exercise by a put
option buyer. (10/01/94)
2202.02 Nature of Long-Term Municipal Bond Index Futures Call Options - The
buyer of one (1) Long-Term Municipal Bond Index futures call option may exercise
his option at any time prior to expiration (subject to Regulation 2207.01), to
assume a long position in one (1) Long-Term Municipal Bond Index futures
contract of a specified contract month at a striking price set at the time the
option was purchased. The seller of one (1) Long-Term Municipal Bond Index
futures call option incurs the obligation of assuming a short position in one
(1) Long-Term Municipal Bond Index futures contract of a specified contract
month at a striking price set at the time the option was sold, upon exercise by
a call option buyer. (10/01/94)
2203.01 Trading Unit - One (1) Long-Term Municipal Bond Index futures contract
of a specified contract month on the Chicago Board of Trade. (10/01/94)
2204.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one (1) point per Long-Term
Municipal Bond Index futures contract. At the commencement of trading for such
option contracts, the following strike prices shall be listed: one with a
striking price closest to the previous day's settlement price on the underlying
Long-Term Municipal Bond Index futures contract, the next six consecutive higher
and the next six consecutive lower striking prices closest to the previous day's
settlement price; and all strike prices listed for all other option contract
months listed at the time. If the previous day's settlement price is midway
between two striking prices, the closest price shall be the larger of the two.
When a sale in the underlying Long-Term Municipal Bond Index futures contract
occurs at a price greater than or equal to the sixth largest striking price, a
new striking price one increment higher than the existing striking prices will
be added. When a sale in the underlying Long-Term Municipal Bond Index futures
contract occurs at a price less than or equal to the sixth smallest striking
price, a new striking price one increment lower than the existing striking
prices will be added. When a new strike price is added for an option contract
month, the same strike price will be added to all option contract months for
which that strike price is not already listed. All new strike prices will be
added prior to the opening of trading on the following business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (10/01/94)
2205.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
2206.01 Option Premium Basis - The premium for Long-Term Municipal Bond Index
futures
Ch22 Trading Conditions
-----------------------
options shall be in multiples of one sixty-fourth (1/64) of one point ($1,000)
of a Long-Term Municipal Bond Index futures contract which shall equal $15.63
per 1/64 and $1,000 per full point. However, for box spreads* the option premium
shall be in multiples of one-half of one sixty-fourth of one point ($1000) which
shall equal $7.81 per one-half of one sixty-fourth and $1,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract.
* A box spread is defined as a position long one call option, short one call
option, long one put option, and short one put option, in split dhe long
call option and the short put option have the same exercise price, the
short call option and the long put option have the same exercise price,
and all options are in the same contract month. (10/01/94)
**2207.01 Exercise of Option - The buyer of a Long-Term Municipal Bond Index
futures option may exercise the option on any business day up to and including
the day such option expires by giving notice of exercise to the Clearing House
by 6:00 p.m., or by such other time designated by the Board of Directors, on
such day. In-the-money options** that have not been liquidated or exercised on
the last day of trading in such option shall be automatically exercised in the
absence of contrary instructions delivered to the Clearing House by 6:00 p.m.,
or by such other time designated by the Board of Directors, on the last day of
trading by the clearing member representing the option buyer. (12/01/99)
**An option is in-the-money if the settlement price of the underlying futures
contract is less in the case of a put, or greater in the case of a call, than
the exercise price of the option.
2208.01 Expiration of Option - Unexercised Long-Term Municipal Bond Index
futures options shall expire at 6:00 p.m. on the day of termination of trading.
(See Regulation 2213.01.) (10/01/94)
2209.01 Months Traded In - Trading may be conducted in Long-Term Municipal
Bond Index futures options for a thirty-six month period extending from the
nearby contract month, provided however, that the Exchange may determine not to
list a contract month. For options that are traded in months in which the
futures are not traded, the underlying futures is the next futures that is
nearest to the expiration of the option. For options that are traded in the same
months in which the futures are traded and expire on the same day in which the
futures expires, the underlying futures is the expiring futures. For options
that are traded in the same months in which the futures are traded but expire on
a different day than the futures, the underlying futures is the next futures
following that delivery month. (10/01/94)
2210.01 Trading Hours - The hours of trading of options on Long-Term
Municipal Bond Index futures contracts shall be determined by the Board. On the
last day of trading in an expiring option, the closing time shall be the same as
the close of trading of the Regular Daytime open outcry trading session for the
corresponding Long-Term Municipal Bond Index futures contract, subject to the
otherwise applicable provisions of the second paragraph of Rule 1007.00. Long-
Term Municipal Bond Index futures options shall be opened and closed for all
months and strike prices simultaneously or in such a manner as the Regulatory
Compliance Committee shall direct. (04/01/00)
2211.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
2212.01 Margin Requirements - (See Regulation 431.03) (10/01/94)
** An option is in-the-money if the settlement price of the underlying
futures contract is less in the case of a put, or greater in the case of
a call than the exercise price for the option.
*2213.01 Last Day of Trading - For options that do not expire on the same day
of the underlying futures contract, the last day of trading shall be the last
Friday which precedes by at least two [five] business days, the last business
day of the option month. If such Friday is not a business day, the last day of
trading shall be the business day prior to such Friday.
For options that expire on the same day of the underlying futures contract, the
last day of trading will be the same as the last day of trading of the
underlying futures contract. (03/01/00)
*Additions underlined, deletions bracketed for contracts from May 2001 forward.
2214.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Long-Term Municipal Bond Index
futures option at a premium of more
Ch22 Trading Conditions
-----------------------
than the trading limit for the Long-Term Municipal Bond Index futures contract
above and below the previous day's settlement premium for that option as
determined by the Clearing Corporation. On the first day of trading, limits
shall be set from the lowest premium of the opening range. (10/01/94)
2215.01 Disclaimer - The Bond Buyer Municipal Bond Index futures and futures
options are not sponsored, endorsed, sold or promoted by Thomson Holdings, Inc.,
its subsidiaries, The CBBB Partnership, or the various brokers who evaluate
bonds for purposes of the Index ("Entities"). These Entities make no
representation or warranty, express or implied, to the owners of Bond Buyer
Municipal Bond Index futures or futures options or any member of the public
regarding the advisability of trading in Bond Buyer Municipal Bond Index futures
and futures options. These Entities have no obligation to take the needs of the
Chicago Board of Trade or the owners of the Bond Buyer Municipal Bond Index
futures and futures options into consideration in determining, composing or
calculating the Index. These Entities are not responsible for and have not
participated in the determination of when the Bond Buyer Municipal Bond Index
futures and futures options are listed for trading and (in the case of71F2B'''
options) at what strike prices or in the determination or calculation of how
such Index futures and futures options may be converted into cash. These
Entities have no obligation or liability in connection with the administration,
marketing or trading of the Bond Buyer Municipal Bond Index futures and futures
options.
THESE ENTITIES DO NO GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE BOND
BUYER MUNICIPAL BOND INDEX OR ANY DATA INCLUDED THEREIN AND SHALL HAVE NO
LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. THESE ENTITIES
MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE
CHICAGO BOARD OF TRADE, OWNERS OF THE BOND BUYER MUNICIPAL BOND INDEX FUTURES
AND FUTURES OPTIONS, OR ANY OTHER PERSON OR ENTITY, FROM THE USE OF SUCH INDEX
OR ANY DATA INCLUDED THEREIN. THESE ENTITIES MAKE NO EXPRESS OR IMPLIED
WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE BOND BUYER MUNICIPAL BOND
INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO
EVENT SHALL THESE ENTITIES HAVE ANY LIABILITY FOR LOST PROFITS OR INDIRECT,
PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF
NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO THIRD PARTY
BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN THESE ENTITIES AND
BETWEEN THESE ENTITIES AND THE CHICAGO BOARD OF TRADE OR THE CBBB PARTNERSHIP.
(04/01/98)
[Enlarge/Download Table]
=========================================================================================================
Chapter 23
Short Term U.S. T-Notes (2-Year)
=========================================================================================================
Ch23 Trading Conditions........................................................................
2301.00 Authority....................................................................
2302.01 Application of Regulation....................................................
2303.01 Emergencies, Acts of God, Acts of Government.................................
2304.01 Unit of Trading..............................................................
2305.01 Months Traded In.............................................................
2306.01 Price Basis..................................................................
2307.01 Hours of Trading.............................................................
2308.01 Trading Limits...............................................................
2309.01 Last Day of Trading..........................................................
2309.02 Liquidation after Trading has Ceased.........................................
2313.01 All-Or-None Orders...........................................................
Ch23 Delivery Procedures.......................................................................
2336.01 Standards....................................................................
2346.01 Date of Delivery.............................................................
2347.01 Delivery Notices.............................................................
2348.01 Method of Delivery...........................................................
2349.01 Time of Delivery, Payment, Form of Delivery Notice...........................
2349.02 Buyer's Report of Eligibility to Receive Delivery............................
2349.03 Seller's Invoice to Buyers...................................................
2349.04 Payment......................................................................
2349.05 Buyers Banking Notification..................................................
2350.00 Duties of Members............................................................
2350.01 Office Deliveries Prohibited.................................................
2354.00 Failure to Accept Delivery...................................................
2380.01 Banks........................................................................
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Chapter 23
Short Term U.S. T-Notes (2-Year)
================================================================================
Ch23 Trading Conditions
2301.00 Authority - (See Rule 1701.00) (10/01/94)
2302.01 Application of Regulation - Futures transactions in short term
U.S. Treasury Notes shall be subject to the general rules of the Association as
far as applicable and shall also be subject to the regulations contained in this
chapter, which are exclusively applicable to trading in short term U.S. Treasury
Notes.
For the purpose of this chapter, the trading day begins with the commencement of
trading on Project A at 2:15 p.m. and ends with the close of trading of regular
daytime trading. (10/01/98)
2303.01 Emergencies, Acts of God, Acts of Government - If the delivery or
acceptance or any precondition or requirement of either, is prevented by strike,
fire, accident, act of government, act of God or other emergency, the seller or
buyer shall immediately notify the Chairman. If the Chairman determines that
emergency action may be necessary, he shall call a special meeting of the Board
and arrange for the presentation of evidence respecting the emergency condition.
If the Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and its decision
shall be binding upon all parties to the contract. For example, and without
limiting the Board's power, it may extend delivery dates and designate
alternative delivery points in the event of conditions interfering with the
normal operations of approved facilities.
In the event the Board determines that there exists a shortage of deliverable
U.S. Treasury Notes, it may, upon a two-thirds vote under Rule 180.00, take such
action as may in the Board's sole discretion appear necessary to prevent,
correct or alleviate the condition. Without limiting the foregoing or the
authority of the Board under Rule 180.00, the Board may:
(1) designate as deliverable, U.S. Treasury Bonds or U.S. Treasury Notes
otherwise meeting the specifications and requirements stated in this
chapter;
(2) designate as deliverable one or more issues of U.S. Treasury Notes and/or
U.S. Treasury Bonds having maturities shorter than one year, nine months or
longer than two years and otherwise meeting the specifications and
requirements stated in this chapter; and/or
(3) determine a cash settlement based on the current cash value of a 6% coupon
rate, one year nine months to two years U.S. Treasury Note, as determined
by using the current market yield curve for U.S. Treasury securities on the
last day of trading. (03/01/00)
2304.01 Unit of Trading - The unit of trading shall be United States
Treasury Notes having a face value at maturity of two hundred thousand dollars
($200,000) or multiples thereof. (10/01/94)
2305.01 Months Traded In - Trading in Short-Term U.S. Treasury Notes
futures may be scheduled in such months as determined by the Exchange.
(03/01/00)
2306.01 Price Basis - Minimum price fluctuations shall be in multiples of
one-quarter of one thirty-second (1/32) point per 100 points ($15.625 rounded up
to the nearest 1 cent per contract). Par shall be on the basis of 100 points.
Contracts shall not be made on any other price basis. (10/01/94)
2307.01 Hours of Trading - The hours of trading for future delivery in
short term U.S. Treasury Notes shall be determined by the Board. On the last day
of trading in an expiring future, the closing time for such future shall be
12:00 noon, subject to the provisions of the second paragraph of Rule 1007.00.
The market shall be opened and closed for all months simultaneously, or in such
other manner as the Regulatory Compliance Committee shall direct. (10/01/94)
2308.01 Trading Limits - (See Regulation 1008.01). (10/01/94)
2309.01 Last Day of Trading - No trades in short term U.S. Treasury Note
futures deliverable in
Ch 23 Trading Conditions
the current month shall be made following the last business day of the calendar
month or two business days prior to issuance of two year notes by the U.S.
Treasury auctioned in the current month, whichever occurs first, and any
contracts remaining open must be settled by delivery or as provided in
Regulation 2309.02 after trading in such contract has ceased. (10/01/94)
2309.02 Liquidation after Trading has Ceased - After trading in contacts
for future delivery in the current delivery month has ceased in accordance with
Regulation 2309.01 of this chapter, outstanding contracts may be liquidated by
the delivery of book-entry U.S. Treasury Notes (Regulation 2342.01) or by mutual
agreement by means of a bona fide exchange of such current futures for actual
U.S. Treasury Notes or comparable instruments. Such exchange must, in any event
be made no later than 12:00 p.m. (Chicago time) on the second business day
immediately preceding the last business day of the delivery month as defined in
Regulation 2346.01. (10/01/94)
2313.01 All-Or-None Orders -The minimum threshold established for All-Or-
None orders in short term U.S. Treasury Note futures is one hundred contracts.
Such orders must be executed in accordance with Regulation 331.03. (07/01/00)
Ch23 Delivery Procedures
2336.01 Standards - The contract grade for delivery on futures contracts
made under these regulations shall be U.S. Treasury Notes which have an original
maturity no greater than five years three months and remaining maturity not less
than one year, nine months and not more than two years as defined below. All
notes delivered against a contract must be of the same issue. For settlement or
for determining remaining maturity for delivery eligibility, the time to
maturity of a given issue is calculated in complete one month increments (i.e. 1
year, 10 months, 17 days is taken to be 1 year, 10 months) from the first day of
the delivery month. The price at which a note with this time to maturity and
with the same coupon rate as this issue will yield 6%, according to bond tables
prepared by the Financial Publishing Co. of Boston, Mass., is multiplied by the
settlement price to arrive at the amount at which the short invoices the long.
Interest accrued on the notes shall be charged to the long by the short in
accordance with Department of the Treasury Circular 300, Subpart P.
New issues of U.S. Treasury Notes which satisfy the standards in this regulation
shall be added to the deliverable grade as they are issued. If during the
auction of a note which will meet the standards of this chapter the Treasury
re-opens an existing issue, thus rendering the existing issue indistinguishable
from the newly auctioned one, the older issue is deemed to meet the standards of
this chapter and would be deliverable. The Exchange shall have the right to
exclude any new issue from deliverable status or to further limit outstanding
issues from deliverable status. (03/01/00)
2342.01 Deliveries on Futures Contracts- Deliveries against short-term
U.S. Treasury Notes futures contracts shall be by book-entry transfer between
accounts of Clearing Members at qualified banks (Regulation 2380.01) in
accordance with Department of Treasury Circular 300, Subpart 0: Book-Entry
Procedure. Delivery must be made no later than the last business day of the
month. Notice of intention to deliver shall be given to the Board of Trade
Clearing Corporation by 8:00 p.m. (Chicago time), or by such other time
designated by the Board of Directors, on the second business day preceding
delivery day. In the event the long Clearing Member does not agree with the
terms of the invoice received from the short Clearing Member, the long Clearing
Member must notify the short Clearing Member, and the dispute must be settled by
9:30 a.m. (Chicago time) on delivery day. The short Clearing Member must have
contract grade U.S. Treasury notes at his bank in acceptable (to his bank)
delivery form by 10:00 a.m. (Chicago time) on delivery day. The short Clearing
Member must notify his bank (Regulation 2380.01) to transfer contract grade U.S.
Treasury notes by book-entry to the long Clearing Member's account on a delivery
versus payment basis. That is, payment shall not be made until the notes are
delivered. On delivery day, the long Clearing Member must make funds available
by 7:30 a.m. (Chicago time) and notify his bank (Regulation 2380.01) to accept
contract grade U.S. Treasury notes and to remit federal funds to the short
Clearing Members' account at the short Clearing Member's bank (Regulation
2380.01) in payment for delivery of the notes. Contract grade U.S. Treasury
notes must be transferred and payment must be made before 1:00 p.m. (Chicago
time) on delivery day. All deliveries must be assigned by the Clearing
Corporation. Where a commission house as a member of the Clearing Corporation
has an interest both long and short for customers on its own books, it must
tender to the Clearing Corporation such notices of intention to deliver as it
received from its customers who are short. (12/01/99)
2342.02 Wire Failure - In the event that delivery cannot be accomplished
because of a failure of the Federal Reserve wire or because of a failure of
either the long Clearing Member's bank or the short Clearing Member's bank
access to the Federal Reserve wire, delivery shall be made before 9:30 a.m. on
the next business day on which the Federal Reserve wire is operable. Interest
shall accrue to the long paid by the short beginning on the day at which the
notes were to be originally delivered.
In the event of such failure, both the long and short must provide documented
evidence that the instructions were given to their respective banks in
accordance with Regulations 2342.01 and 2349.04 and that all provisions of
Regulations of 2342.01 and 2349.04 have been complied with. (10/01/94)
2346.01 Date of Delivery - Delivery of short term U.S. Treasury Notes may
be made by the short upon any permissible delivery day of the delivery month the
short may select. The delivery month extends to and includes the third business
day following the last trading day in the current month. Delivery of short term
U.S. Treasury Notes must be made no later than the last business day of that
Ch 23 Delivery Procedures
month. (11/01/94)
2347.01 Delivery Notices - (See Regulation 1047.01) (10/01/94)
2348.01 Method of Delivery - (See Regulation 1048.01) (10/01/94)
2349.01 Time of Delivery, Payment, Form of Delivery Notice - (See Rule
1049.00) (10/01/94)
2349.02 Buyer's Report of Eligibility to Receive Delivery - (See
Regulation 1049.02) (10/01/94)
2349.03 Seller's Invoice to Buyers - Upon determining the buyers
obligated to accept deliveries tendered by issuers of delivery notices, the
Clearing House shall promptly furnish each issuer the names of the buyers
obligated to accept delivery from him and a description of each commodity
tendered by him which was assigned by the Clearing House to each such buyer.
Thereupon, sellers (issuers of delivery notices) shall prepare invoices
addressed to their assigned buyers, describing the documents to be delivered to
each such buyer. Such invoices shall show the amount which buyers must pay to
sellers in settlement of the actual deliveries, based on the delivery prices
established by the Clearing House, and adjusted for applicable interest
payments. Such invoices shall be delivered to the Clearing House by 2:00 p.m.,
or by such other time designated by the Board of Directors, on the day of
intention except on the last intention day of the month, where such invoices
shall be delivered to the Clearing House by 3:00 p.m., or by such other time
designated by the Board of Directors. Upon receipt of such invoices, the
Clearing House shall promptly make them available to buyers to whom they are
addressed, by placing them in buyers' mail boxes provided for that purpose in
the Clearing House. (12/01/99)
2349.04 Payment - Payment shall be made in federal funds. The long
obligated to take delivery must take delivery and make payments before 1:00 p.m.
on the day of delivery, except on banking holidays when delivery must be taken
and payment made before 9:30 a.m. the next banking business day. Adjustments for
differences between contract prices and delivery prices established by the
Clearing House shall be made with the Clearing House in accordance with its by-
laws and resolutions. (10/01/94)
2349.05 Buyers Banking Notification - The long Clearing Member shall
provide the short Clearing member by 4:00 p.m. (5:00 p.m. EST) on the day of
intention, one business day prior to delivery day, with a Banking Notification.
The Banking Notification form will include the following information: the
identification number and name of the long Clearing Member; the delivery date;
the notification number of the delivery assignment; the identification number
and name of the short Clearing Member making delivery; the quantity of the
contract being delivered; the long Clearing Member's bank, account number and
specific Federal Wire instructions for the transfer of U.S. securities.
(10/01/94)
2350.00 Duties of Members - (See Rule 1050.00) (10/01/94)
2350.01 Office Deliveries Prohibited - (See Regulation 1051.01)
(10/01/94)
2354.00 Failure to Accept Delivery - (See Rule 1054.00) (10/01/94)
2380.01 Banks - For purposes of these regulations relating to trading in
short term U.S. Treasury Notes, the word "Bank" (Regulation 2342.01) shall mean
a U.S. commercial bank (either Federal or State charter) that is a member of the
Federal Reserve System and with capital (capital, surplus, and undivided
earnings) in excess of one hundred million dollars ($100,000,000). (10/01/94)
[Enlarge/Download Table]
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Chapter 24
Long Term T-Notes (6 1/2 -10 Year)
=============================================================================================================
Ch24 Trading Conditions..........................................................................
2401.00 Authority......................................................................
2402.01 Application of Regulation......................................................
2403.01 Emergencies, Acts of God, Acts of Government...................................
2404.01 Unit of Trading................................................................
2405.01 Months Traded In...............................................................
2406.01 Price Basis....................................................................
2407.01 Hours of Trading...............................................................
2408.01 Trading Limits.................................................................
2409.01 Last Day of Trading............................................................
2409.02 Liquidation in the Last Seven Days of Delivery Months..........................
2412.12 Position Limits and Reportable Positions.......................................
Ch24 Delivery Procedures.........................................................................
2436.01 Standards......................................................................
2442.01 Deliveries of Futures Contracts................................................
2442.02 Wire Failure...................................................................
2446.01 Date of Delivery...............................................................
2447.01 Delivery Notices...............................................................
2448.01 Method of Delivery.............................................................
2449.00 Time of Delivery, Payment, Form of Delivery Notice.............................
2449.02 Buyer's Report of Eligibility to Receive Delivery..............................
2449.03 Sellers Invoice to Buyers......................................................
2449.04 Payment........................................................................
2449.05 Buyers Banking Notification....................................................
Ch24 Regularity of Banks.........................................................................
2480.01 Banks..........................................................................
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Chapter 24
Long Term T-Notes (6 1/2 -10 Year)
================================================================================
Ch24 Trading Conditions
2401.00 Authority - (See Rule 1701.00) (10/01/94)
2402.01 Application of Regulations - Futures transactions in long term U.S.
Treasury Notes shall be subject to the general rules of the Association as far
as applicable and shall also be subject to the regulations contained in this
chapter, which are exclusively applicable to trading in long term U.S. Treasury
Notes. (09/01/00)
2403.01 Emergencies, Acts of God, Acts of Government - If the delivery or
acceptance or any precondition or requirement of either, is prevented by strike,
fire, accident, act of government, act of God or other emergency, the seller or
buyer shall immediately notify the Chairman. If the Chairman determines that
emergency action may be necessary, he shall call a special meeting of the Board
and arrange for the presentation of evidence respecting the emergency condition.
If the Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and its decision
shall be binding upon all parties to the contract. For example, and without
limiting the Board's power, it may extend delivery dates and designate
alternative delivery points in the event of conditions interfering with the
normal operations of approved facilities.
In the event the Board determines that there exists a shortage of deliverable
U.S. Treasury Notes, it may, upon a two-thirds vote under Rule 180.00, take such
action as may be in the Board's sole discretion appear necessary to prevent,
correct or alleviate the condition. Without limiting the foregoing or the
authority of the Board under Rule 180.00, the Board may:
(1) designate as deliverable, callable U.S. Treasury Bonds otherwise meeting
the specifications and requirements stated in this chapter;
(2) designate as deliverable one or more issues of U.S. Treasury Notes
and/or U.S. Treasury Bonds having maturities shorter than six and one-
half years, or longer than ten years and otherwise meeting the
specifications and requirements stated in this chapter; and/or
(3) determine a cash settlement based on the current cash value of a 6%
coupon rate, six and one-half years to ten years U.S. Treasury Note, as
determined by using the current market yield curve for U.S. Treasury
securities on the last day of trading. (03/01/00)
2404.01 Unit of Trading - The unit of trading shall be United States Treasury
Notes having a face value at maturity of one hundred thousand dollars ($100,000)
or multiples thereof. (10/01/94)
*2405.01 Months Traded In - Trading in Long-Term U.S. Treasury notes futures
may be scheduled in such months as determined by the Exchange. (03/01/00)
2406.01 Price Basis - Minimum price fluctuations shall be in multiples of
one-half of one thirty-second (1/32) point per 100 points ($15.625 per contract)
except for intermonth spreads for contracts traded by open outcry only, where
minimum price fluctuations shall be in multiples of one-fourth of one thirty-
second point per 100 points ($7.8125 per contract). Par shall be on the basis of
100 points. Contracts shall not be made on any other price basis. (07/01/99)
2407.01 Hours of Trading - The hours of trading for future delivery in long
term U.S. Treasury Notes shall be determined by the Board. On the last day of
trading in an expiring future, the closing time for such future shall be 12:00
noon subject to the provisions of the second paragraph of Rule 1007.00.
The market shall be opened and closed for all months simultaneously, or in such
other manner as the Regulatory Compliance Committee shall direct. (10/01/94)
2408.01 Trading Limits - (See Regulation 1008.01) (10/01/94)
2409.01 Last Day of Trading - No trades in long term U.S. Treasury Note
futures deliverable in
Ch24 Trading Conditions
-----------------------
the current month shall be made during the last seven business days of that
month and any contracts remaining open must be settled by delivery or as
provided in Regulation 2409.02 after trading in such contracts has ceased.
(10/01/94)
2409.02 Liquidation in the Last Seven Days of Delivery Months - After trading
in contracts for future delivery in the current delivery month has ceased in
accordance with Regulation 2409.01 of this chapter, outstanding contracts may be
liquidated by the delivery of book-entry U.S. Treasury Notes or Bonds
(Regulation 2442.01) or by mutual agreement by means of a bona fide exchange of
such current futures for actual U.S. Treasury Notes or Bonds or comparable
instruments. Such exchange must, in any event, be made no later than the fifth
business day immediately preceding the last business day of the delivery month.
(10/01/94)
2412.12 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/94)
Ch24 Delivery Procedures
2436.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be U.S. Treasury Notes which have an actual
maturity of not less than six and one-half years and not more than ten years.
All notes delivered against a contract must be of the same issue. For
settlement, the time to maturity of a given issue is calculated in complete
quarter year increments (i.e. 8 years, 10 months, 17 days is taken to be 8
years, 9 months) from the first day of the delivery month. The price at which a
note with this time to maturity and with the same coupon rate as this issue will
yield 6%, according to bond tables prepared by the Financial Publishing Co. of
Boston, Mass., is multiplied by the settlement price to arrive at the amount at
which the short invoices the long.
U.S. Treasury Notes deliverable against futures contracts under these
regulations must have semi-annual coupon payments.
Interest accrued on the notes shall be charged to the long by the short in
accordance with Department of the Treasury Circular 300, Subpart P.
New issues of U.S. Treasury Notes which satisfy the standards in this regulation
shall be added to the deliverable grade as they are issued. If during the
auction of a note which will meet the standards of this chapter the Treasury re-
opens an existing issue, thus rendering the existing issue indistinguishable
from the newly auctioned one, the older issue is deemed to meet the standards of
this chapter and would be deliverable. The Exchange shall have the right to
exclude any new issue from deliverable status or to further limit outstanding
issues from deliverable status. (03/01/00)
2442.01 Deliveries of Futures Contracts - Deliveries against long term U.S.
Treasury Note futures contracts shall be by book-entry transfer between accounts
of Clearing Members at qualified banks (Regulation 2480.01) in accordance with
Department of Treasury Circular 300, Subpart O: Book-Entry Procedure. Delivery
must be made no later than the last business day of the month. Notice of
intention to deliver shall be given to the Board of Trade Clearing Corporation
by 8:00 p.m. (Chicago time), or by such other time designated by the Board of
Directors, on the second business day preceding delivery day. In the event the
long Clearing Member does not agree with the terms of the invoice received from
the short Clearing Member, the long Clearing Member must notify the short
Clearing Member, and the dispute must be settled by 9:30 a.m. (Chicago time) on
delivery day. The short Clearing Member must have contract grade U.S. Treasury
notes in place at his bank in acceptable (to his bank) delivery form no later
than 10:00 a.m. (Chicago time) on delivery day. The short Clearing Member must
notify his bank (Regulation 2480.01) to transfer contract grade U.S. Treasury
notes by book-entry to the long Clearing Member's account at the long Clearing
Member's bank on a delivery versus payment basis. That is, payment shall not be
made until the notes are delivered. On delivery day, the long Clearing Member
must make funds available by 7:30 a.m. (Chicago time) and notify his bank
(Regulation 2480.01) to accept contract grade U.S. Treasury notes and to remit
federal funds to the short Clearing Member's account at the short Clearing
Member's bank (Regulation 2480.01) in payment for delivery of the notes.
Contract grade U.S. Treasury notes must be transferred and payment must be made
before 1:00 p.m. (Chicago time) on delivery day. All deliveries must be assigned
by the Clearing Corporation. Where a commission house as a member of the
Clearing Corporation has an interest both long and short for customers on its
own books, it must tender to the Clearing Corporation such notices of intention
to deliver as it received from its customers who are short. (12/01/99)
2442.02 Wire Failure - In the event that delivery cannot be accomplished
because of a failure of the Federal Reserve wire or because of a failure of
either the long Clearing Member's bank or thbulletinClearing Member's bank
access to the Federal Reserve wire, delivery shall be made before 9:30 a.m. on
the next business day on which the Federal Reserve wire is operable. Interest
shall accrue to the long paid by the short beginning on the day at which the
notes were to be originally delivered.
In the event of such failure, both the long and short must provide documented
evidence that the instructions were given to their respective banks in
accordance with Regulations 2442.01 and 2449.04 and that all other provisions of
Regulations of 2442.01 and 2449.04 have been complied with. (10/01/94)
Ch24 Delivery Procedures
------------------------
2446.01 Date of Delivery - Delivery of long term U.S. Treasury Notes may be
made by the short upon any permissible delivery day of the delivery month the
short may select. Delivery of long term U.S. Treasury Notes must be made no
later than the last business day of that month. (10/01/94)
2447.01 Delivery Notices - (See Regulation 1047.01) (10/01/94)
2448.01 Method of Delivery - (See Regulation 1048.01) (10/01/94)
2449.00 Time of Delivery, Payment, Form of Delivery Notice - (See Rule
1049.00) (10/01/94)
2449.02 Buyer's Report of Eligibility to Receive Delivery - (See Regulation
1049.02) (10/01/94)
2449.03 Sellers Invoice to Buyers- Upon determining the buyers obligated to
accept deliveries tendered by issuers of delivery notices, the Clearing House
shall promptly furnish each issuer the names of the buyers obligated to accept
delivery from him and a description of each commodity tendered by him which was
assigned by the Clearing House to each such buyer. Thereupon, sellers (issuers
of delivery notices) shall prepare invoices addressed to their assigned buyers
describing the documents to be delivered to each such buyer. Such invoices shall
show the amount which buyers must pay to sellers in settlement of the actual
deliveries, based on the delivery prices established by the Clearing House, and
adjusted for applicable interest payments. Such invoices shall be delivered to
the Clearing House by 2:00 p.m., or by such other time designated by the Board
of Directors, on the day of intention except on the last intention day of the
month, where such invoices shall be delivered to the Clearing House by 3:00
p.m., or by such other time designated by the Board of Directors. Upon receipt
of such invoices, the Clearing House shall promptly make them available to
buyers to whom they are addressed, by placing them in buyer's mail boxes
provided for that purpose in the Clearing House. (12/01/99)
2449.04 Payment- Payment shall be made in federal funds. The long obligated
to take delivery must take delivery and make payment before 1:00 p.m. on the day
of delivery, except on banking holidays when delivery must be taken and payment
made before 9:30 a.m. the next business day. Adjustments for differences between
contract prices and delivery prices established by the Clearing House shall be
made with the Clearing House in accordance with its by-laws and resolutions.
(10/01/94)
2449.05 Buyers Banking Notification - - The long Clearing Member shall
provide the short Clearing member by 4:00 p.m. (5:00 p.m. EST) on the day of
intention, one business day prior to delivery day, with a Banking Notification.
The Banking Notification form will include the following information: the
identification number and name of the long Clearing Member; the delivery date;
the notification number of the delivery assignment; the identification number
and name of the short Clearing Member making delivery; the quantity of the
contract being delivered; the long Clearing Member's bank, account number and
specific Federal Wire instructions for the transfer of U.S. securities.
(10/01/94)
Ch24 Regularity of Banks
2480.01 Banks- - For purposes of these regulations relating to trading in
long term U.S. Treasury Notes, the word "Bank" (Regulation 2442.01) shall mean a
U.S. commercial bank (either Federal or State charter) that is a member of the
Federal Reserve System and with capital (capital, surplus and undivided
earnings) in excess of one hundred million dollars ($100,000,000). (10/01/94)
[Enlarge/Download Table]
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Chapter 25
Medium Term U.S. Treasury Notes (5 Year)
===============================================================================================================
Ch25 Trading Conditions..........................................................................
2501.00 Authority....................................................................
2502.01 Application of Regulation....................................................
2503.01 Emergencies, Acts of God, Acts of Government.................................
2504.01 Unit of Trading..............................................................
2505.01 Months Traded In.............................................................
2506.01 Price Basis..................................................................
2508.01 Trading Limits...............................................................
2508.01A Trading Limits...............................................................
2509.01 Last Day of Trading..........................................................
2509.02 Liquidation in the Last Seven Days of the Delivery Month.....................
2510.01 Margin Requirements..........................................................
Ch25 Delivery Procedures.........................................................................
2536.01 Standards....................................................................
2542.01 Deliveries on Futures Contracts..............................................
2542.02 Wire Failure.................................................................
2546.01 Date of Delivery.............................................................
2547.01 Delivery Notices.............................................................
2548.01 Method of Delivery...........................................................
2549.00 Time of Delivery, Payment, Form of Delivery Notice...........................
2549.02 Buyer's Report of Eligibility to Receive Delivery............................
2549.03 Seller's Invoice to Buyers...................................................
2549.04 Payment......................................................................
2549.05 Buyers Banking Notification..................................................
2550.00 Duties of Members............................................................
2551.01 Office Deliveries Prohibited.................................................
2554.00 Failure to Accept Delivery...................................................
Ch25 Regularity of Banks.........................................................................
2580.01 Banks........................................................................
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Chapter 25
Medium Term U.S. Treasury Notes (5 Year)
===============================================================================
Ch25 Trading Conditions
2501.00 Authority - (See Rule 1701.00) (10/01/94)
2502.01 Application of Regulations - Futures transactions in medium term U.S.
Treasury Notes shall be subject to the general rules of the Association as far
as applicable and shall also be subject to the regulations contained in this
chapter, which are exclusively applicable to trading in medium term U.S.
Treasury Notes. (09/01/00)
2503.01 Emergencies, Acts of God, Acts of Government - If the delivery or
acceptance or any precondition or requirement of either, is prevented by strike,
fire, accident, act of government, act of God or other emergency, the seller or
buyer shall immediately notify the Chairman. If the Chairman determines that
emergency action may be necessary, he shall call a special meeting of the Board
and arrange for the presentation of evidence respecting the emergency condition.
If the Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and its decision
shall be binding upon all parties to the contract. For example, and without
limiting the Board's power, it may extend delivery dates and designate
alternative delivery points in the event of conditions interfering with the
normal operations of approved facilities.
In the event the Board determines that there exists a shortage of deliverable
U.S. Treasury Notes, it may, upon a two-thirds vote under Rule 180.00, take such
action as may in the Board's sole discretion appear necessary to prevent,
correct or alleviate the condition. Without limiting the foregoing or the
authority of the Board under Rule 180.00, the Board may:
(1) designate as deliverable, U.S. Treasury Bonds otherwise meeting the
specifications and requirements stated in this chapter;
(2) designate as deliverable one or more issues of U.S. Treasury Notes
and/or U.S. Treasury Bonds having maturities shorter than four years and
two months, or longer than five years and two months and otherwise
meeting the specifications and requirements stated in this chapter.
(3) determine a cash settlement based on the current cash value of a 6%
coupon rate, five year U.S. Treasury Note, as determined by using the
current cash market yield curve for U.S. Treasury securities on the last
day of trading. (03/01/00)
2504.01 Unit of Trading - The unit of trading shall be United States Treasury
Notes having a face value at maturity of one hundred thousand dollars ($100,000)
or multiples thereof. (10/01/94)
2505.01 Months Traded In - Trading in Medium-Term U.S. Treasury notes futures
may be scheduled in such months as determined by the Exchange. (03/01/00)
2506.01 Price Basis - Minimum price fluctuations shall be in multiples of one-
half of one thirty-second (1/32) point per 100 points ($15.625 rounded up to the
nearest 1(cent) per contract) except for intermonth spreads for contracts traded
by open outcry only, where minimum price fluctuations shall be in multiples of
one-fourth of one thirty-second point per 100 points ($7.8125 per contract). Par
shall be on the basis of 100 points. Contracts shall not be made on any other
price basis. (03/01/00)
2507.01 Hours of Trading - The hours of trading for future delivery in U.S.
Treasury Notes shall be determined by the Board. On the last day of trading in
an expiring future, the closing time for such future shall be 12:00 noon subject
to the provisions of the second paragraph of Rule 1007.00. The market shall be
opened and closed for all months simultaneously or in such other manner as the
Regulatory Compliance Committee shall direct. (10/01/94)
2508.01 Trading Limits - (See Regulation 1008.01) (10/01/94)
2508.01A Trading Limits - (See Ruling 1008.01A) (10/01/94)
2509.01 Last Day of Trading - No trades in medium term U.S. Treasury Note
futures deliverable
Ch25 Trading Conditions
-----------------------
in the current month shall be made during the last seven business days of that
month and any contracts remaining open must be settled by delivery as provided
in Regulation 2509.02 after trading in such contracts has ceased. (10/01/94)
2509.02 Liquidation in the Last Seven Days of the Delivery Month - After
trading in contracts for future delivery in the current delivery month has
ceased in accordance with Regulation 2509.01 of this chapter, outstanding
contracts may be liquidated by the delivery of book-entry U.S. Treasury Notes
(Regulation 2542.01) or by mutual agreement by means of bona fide exchange of
such current futures for actual U.S. Treasury Notes or comparable instruments.
Such exchange must, in any event, be made no later than the fifth business day
immediately preceding the last business day of the delivery month. (10/01/94)
2510.01 Margin Requirements - (See Regulation 431.03) (10/01/94)
Ch25 Delivery Procedures
2536.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be U.S. notes which have an original maturity of
not more than 5 years three months and which have a remaining maturity of not
less than four years and two months as defined below. To be delivered in the
current month, the note must have been issued by the Treasury before the last
day of trading in the current month. All notes or bonds delivered against a
contract must be of the same issue. For settlement, the time to maturity of a
given issue is calculated in complete one month increments (i.e. 4 years, 5
months and 14 days is taken to be 4 years and 5 months) from the first day of
the delivery month. The price at which a note with this time to maturity and
with the same coupon rate as this issue will yield 6%, according to bond tables
prepared by the Financial Publishing Co. of Boston, Mass., is multiplied by the
settlement price to arrive at the amount which the short invoices the long.
Interest accrued on the notes shall be charged to the long by the short in
accordance with Department of the Treasury Circular 300, Subpart P.
New issues of U.S. Treasury Notes which satisfy the standards in this regulation
shall be added to the deliverable grade as they are issued. If during the
auction of a note which will meet the standards of this chapter the Treasury
re-opens an existing issue, thus rendering the existing issue indistinguishable
from the newly auctioned one, the older issue is deemed to meet the standards of
this chapter and would be deliverable. The Exchange shall have the right to
exclude any new issue from deliverable status or to further limit outstanding
issues from deliverable status. (03/01/00)
2542.01 Deliveries on Futures Contracts - Deliveries against medium term U.S.
Treasury Note futures contracts shall be by book-entry transfer between accounts
of Clearing Members at qualified banks (Regulation 2580.01) in accordance with
Department of Treasury Circular 300, Subpart O: Book-Entry Procedure. Delivery
must be made no later than the last business day of the month. Notice of
intention to deliver shall be given to the Board of Trade Clearing Corporation
by 8:00 p.m. (Chicago time), or by such other time designated by the Board of
Directors, on the second business day preceding delivery day. In the event the
long Clearing Member does not agree with the terms of the invoice received from
the short Clearing Member, the long Clearing Member must notify the short
Clearing Member, and the dispute must be settled by 9:30 a.m. (Chicago time) on
delivery day. The short Clearing Member must have contract grade U.S. Treasury
notes at his bank in acceptable (to his bank) delivery form by 10:00 a.m.
(Chicago time) on delivery day. The short Clearing Member must notify his bank
(Regulation 2580.01) to transfer contract grade U.S. Treasury notes by
book-entry to the long Clearing Member's account on a delivery versus payment
basis. That is, payment shall not be made until the notes are delivered. On
delivery day, the long Clearing Member must make funds available by 7:30 a.m.
(Chicago time) and notify his bank (Regulation 2580.01) to accept contract grade
U.S. Treasury notes and to remit federal funds to the short Clearing Member's
account at the short Clearing Member's bank (Regulation 2580.01) in payment for
delivery of the notes. Contract grade U.S. Treasury notes must be transferred
and payment must be made before 1:00 p.m. (Chicago time) on delivery day. All
deliveries must be assigned by the Clearing Corporation. Where a commission
house as a member of the Clearing Corporation has an interest both long and
short for customers on its own books, it must tender to the Clearing Corporation
such notices of intention to deliver as it received from its customers who are
short. (12/01/99)
2542.02 Wire Failure - In the event that delivery cannot be accomplished
because of a failure of the Federal Reserve wire or because of a failure of
either the long Clearing Member's bank or the short Clearing Member's bank
access to the Federal Reserve wire, delivery shall be made before 9:30 a.m. on
the next business day on which the Federal Reserve wire is operable. Interest
shall accrue to the long paid by the short beginning on the day at which the
notes were to be originally delivered.
In the event of such failure, both the long and short must provide documented
evidence that the instructions were given to their respective banks in
accordance with Regulations 2542.01 and 2549.04 and that all other provisions of
Regulations of 2542.01 and 2549.04 have been complied with. (10/01/94)
2546.01 Date of Delivery - Delivery of medium term U.S. Treasury Notes may be
made by the short upon any permissible delivery day of the delivery month the
short may select. Delivery of medium
Ch25 Delivery Procedures
------------------------
term U.S. Treasury Notes must be made no later than the last business day of
that month. (10/01/94)
2547.01 Delivery Notices - (See Regulation 1047.01) (10/01/94)
2548.01 Method of Delivery - (See Regulation 1048.01) (10/01/94)
2549.00 Time of Delivery, Payment, Form of Delivery Notice - (See Rule
1049.00) (10/01/94)
2549.02 Buyer's Report of Eligibility to Receive Delivery - (See Regulation
1049.02) (10/01/94)
2549.03 Seller's Invoice to Buyers - Upon determining the buyers obligated to
accept deliveries tendered by issuers of delivery notices, the Clearing House
shall promptly furnish each issuer the names of the buyers obligated to accept
delivery from him and a description of each commodity tendered by him which was
assigned by the Clearing House to each such buyer. Thereupon, sellers (issuers
of delivery notices) shall prepare invoices addressed to their assigned buyers,
describing the documents to be delivered to each such buyer. Such invoices shall
show the amount which buyers must pay to sellers in settlement of the actual
deliveries, based on the delivery prices established by the Clearing House, and
adjusted for applicable interest payments. Such invoices shall be delivered to
the Clearing House by 2:00 p.m., or by such other time designated by the Board
of Directors, on the day of intention except on the last intention day of the
month, where such invoices shall be delivered to the Clearing House by 3:00
p.m., or by such other time designated by the Board of Directors. Upon receipt
of such invoices, the Clearing House shall promptly make them available to
buyers to whom they are addressed, by placing them in buyer's mail boxes
provided for that purpose in the Clearing House. (12/01/99)
2549.04 Payment - Payment shall be made in federal funds. The long obligated
to take delivery must take delivery and make payment before 1:00 p.m. on the day
of delivery, except on banking holidays when delivery must be taken and payment
made before 9:30 a.m. the next banking business day. Adjustments for differences
between contract prices and delivery prices established by the Clearing House
shall be made with the Clearing House in accordance with its by-laws and
resolutions. (10/01/94)
2549.05 Buyers Banking Notification - The long Clearing Member shall provide
the short Clearing member by 4:00 p.m. (5:00 p.m. EST) on the day of intention,
one business day prior to delivery day, with a Banking Notification. The Banking
Notification form will include the following information: the identification
number and name of the long Clearing Member; the delivery date; the notification
number of the delivery assignment; the identification number and name of the
short Clearing Member making delivery; the quantity of the contract being
delivered; the long Clearing Member's bank, account number and specific Federal
Wire instructions for the transfer of U.S. securities. (10/01/94)
2550.00 Duties of Members - (See Rule 1050.00) (10/01/94)
2551.01 Office Deliveries Prohibited - (See Regulation 1051.01) (10/01/94)
2554.00 Failure to Accept Delivery - (See Rule 1054.00) (10/01/94)
Ch25 Regularity of Banks
2580.01 Banks - For purposes of these regulations relating to trading in U.S.
Treasury notes, the word "Bank" (Regulation 2542.01) shall mean a U.S.
commercial bank (either Federal or State charter) that is a member of the
Federal Reserve System and with capital (capital, surplus, and undivided
earnings) in excess of one hundred million dollars ($100,000,000). (10/01/94)
[Enlarge/Download Table]
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Chapter 27A (Standard Options)
Long Term Treasury Note Futures Options
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Ch27A Trading Conditions..........................................................
A2701.00 Authority.....................................................
A2701.01 Application of Regulations....................................
A2702.01 Nature of Long Term Treasury Note Futures Put Options.........
A2702.02 Nature of Long Term Treasury Note Futures Call Options........
A2703.01 Trading Unit..................................................
A2704.01 Striking Prices...............................................
A2705.01 Payment of Option Premium.....................................
A2706.01 Option Premium Basis..........................................
A2707.01 Exercise of Option............................................
A2707.02 Automatic Exercise............................................
A2708.01 Expiration of Option..........................................
A2709.01 Months Traded In..............................................
A2710.01 Trading Hours.................................................
A2711.01 Position Limits and Reportable Positions......................
A2712.01 Margin Requirements...........................................
A2713.01 Last Day of Trading...........................................
A2714.01 Option Premium Fluctuation Limits.............................
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Chapter 27A (Standard Options)
Long Term Treasury Note Futures Options
================================================================================
Ch27A Trading Conditions
A2701.00 Authority - (See Rule 2801.00) (10/01/94)
A2701.01 Application of Regulations - Transactions in put and call options on
Long Term Treasury Note futures contracts shall be subject to the general rules
of the Association as far as applicable and shall also be subject to the
regulations contained in this chapter which are exclusively applicable to
trading in put and call options on Long Term Treasury Note futures contracts.
(See Rule 490.00) (09/01/00)
A2702.01 Nature of Long Term Treasury Note Futures Put Options - The buyer of
one (1) Long Term Treasury Note futures put option may exercise his option at
any time prior to expiration (subject to Regulation 2707.01), to assume a short
position in one (1) Long Term Treasury Note futures contract of a specified
contract month at a striking price set at the time the option was purchased. The
seller of one (1) Long Term Treasury Note futures put option incurs the
obligation of assuming a long position in one (1) Long Term Treasury Note
futures contract of a specified contract month at a striking price set at the
time the option was sold, upon exercise by a put option buyer. (10/01/94)
A2702.02 Nature of Long Term Treasury Note Futures Call Options - The buyer of
one (1) Long Term Treasury Note futures call option may exercise his option at
any time prior to expiration (subject to Regulation 2707.01), to assume a long
position in one (1) Long Term Treasury Note futures contract of a specified
contract month at a striking price set at the time the option was purchased. The
seller of one (1) Long Term Treasury Note futures call option incurs the
obligation of assuming a short position in one (1) Long Term Treasury Note
futures contract of a specified contract month at a striking price set at the
time the option was sold, upon exercise by a call option buyer. (10/01/94)
A2703.01 Trading Unit - One (1) $100,000 face value Long Term Treasury Note
futures contract of a specified contract month on the Chicago Board of Trade.
(10/01/94)
A2704.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one (1) point per Long Term
Treasury Note futures contract. At the commencement of trading for such option
contracts, the following strike prices shall be listed: one with a striking
price closest to the previous day's settlement price on the underlying Long Term
Treasury Note futures contract, and the next fifteen consecutive higher and the
next fifteen consecutive lower striking prices closest to the previous day's
settlement price; and all strike prices listed for all other option contract
months listed at the time. If the previous day's settlement price is midway
between two striking prices, the closest price shall be the larger of the two.
When a sale in the underlying Long Term Treasury Note futures contract occurs at
a price greater than or equal to the fifteenth largest striking price, a new
striking price one increment higher than the existing striking prices will be
added. When a sale in the underlying Long Term Treasury Note futures contract
occurs at a price less than or equal to the fifteenth smallest striking price, a
new striking price one increment lower than the existing striking prices will be
added. When a new strike price is added for an option contract month, the same
strike price will be added to all option contract months for which that strike
price is not already listed. All new strike prices will be added prior to the
opening of trading on the following business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (01/01/99)
A2705.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
A2706.01 Option Premium Basis - The Premium for Long Term Treasury Note futures
options
Ch27A Trading Conditions
------------------------
shall be in multiples of one sixty-fourth (1/64) of one percent (1%) of a
$100,000 Long Term Treasury Note futures contract which shall equal $15.63 per
1/64 and $1,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract.
If options are quoted in volatility terms, the minimum fluctuation shall be .10
percent (i.e.-10.0%, 10.1%, 10.2%, etc.) (10/01/94)
A2707.01 Exercise of Option - The buyer of a Long Term Treasury Note futures
option may exercise the option on any business day prior to expiration by giving
notice of exercise to the Clearing Corporation by 6:00 p.m., or by such other
time designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. on the
expiration date :
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
A2707.02 Automatic Exercise - Notwithstanding the provisions of Regulation
2707.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
A2708.01 Expiration of Option - Unexercised Long Term Treasury Note futures
options shall expire at 10:00 a.m. on the first Saturday following the last day
of trading. (10/01/94)
A2709.01 Months Traded In - Trading may be conducted in Long Term Treasury Note
futures options for a thirty six month period extending from the nearby contract
month, provided however, that the Exchange may determine not to list a contract
month. Both serial and quarterly options may be listed to expire into either
front-month or deferred futures as determined by the Board. (06/01/99)
A2710.01 Trading Hours - The hours of trading of options on Long Term Treasury
Note futures contracts shall be determined by the Board. On the last day of
trading in an expiring option the closing time for such option shall be the same
as the close of trading of the Regular Daytime open outcry trading session for
the corresponding Long Term Treasury Note futures contract, subject to the
provisions of the second paragraph of Rule 1007.00. Long Term Treasury Note
futures options shall be opened and closed for all months and strike prices
simultaneously or in such a manner as the Regulatory Compliance Committee shall
direct. (04/01/00)
A2711.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
A2712.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*A2713.01 Last Day of Trading - No trades in Long Term Treasury Note futures
options expiring in the current month shall be made after the close of trading
of the Regular Daytime open outcry trading session for the corresponding Long
Term Treasury Note futures contract, on the last Friday which precedes by at
least two [five] business days, the last business day of the month preceding the
---
option month. If such Friday is not a business day, or there is a Friday which
is not a business day which
precedes by one [four] business day[s] the last business day of the month
---
preceding the option month,
Ch27A Trading Conditions
------------------------
the last day of trading shall be the business day prior to such Friday.
(03/01/00)
* Additions underlined; deletions bracketed for contracts from June 2001
forward.
A2714.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Long Term Treasury Note futures
option at a premium of more than the trading limit for the Long Term Treasury
Note futures contract above and below the previous day's settlement premium for
that option as determined by the Clearing Corporation. On the first day of
trading, limits shall be set from the lowest premium of the opening range.
(10/01/94)
[Enlarge/Download Table]
===============================================================================================================
Chapter 27B (Flexible Options)
Long Term Treasury Note Flexible Options
===============================================================================================================
Ch27B Trading Conditions........................................................................
B2702.03 Nature of Flexible Options..................................................
B2703.01 Trading Unit................................................................
B2704.01 Strike Prices...............................................................
B2707.01 Exercise of Flexible Options................................................
B2707.02 Automatic Exercise..........................................................
B2708.01 Expiration Date.............................................................
B2709.01 Months Traded In............................................................
B2713.01 Last Day of Trading.........................................................
B2715.01 Exercise Style..............................................................
B2716.01 Underlying Futures Contract for Flexible Options............................
B2717.01 Initiating a Flexible Option Contract Series................................
B2719.01 RFQ Trading Interval........................................................
B2720.01 Expiration of an RFQ........................................................
B2721.01 Reporting of Flexible Option Trades.........................................
===============================================================================
Chapter 27B (Flexible Options)
Long Term Treasury Note Flexible Options
===============================================================================
Note: The following Flexible option regulations with the exception
noted in the second paragraph of Regulation 2702.03 supersede the
corresponding standard regulations presented in Part A of this
chapter. Regulations 2701.00, 2701.01, 2702.01, 2702.02, 2705.01,
2706.01, 2710.01, 2711.01, 2712.01, and 2714.01 remain in effect
for both standard and Flexible options.
Ch27B Trading Conditions
B2702.03 Nature of Flexible Options - Flexible options on Long Term Treasury
Note futures shall be permitted in puts and calls which do not have the same
underlying futures contract, same strike price, same exercise style, and same
last day of trading as standard options.
However, Flexible Options on Long Term Treasury Note futures shall also be
permitted in puts and calls which have the same underlying futures contract,
same strike price, same exercise style, and same last day of trading as standard
options that are not at the time listed for trading in the standard options pit
or on e-cbot. All Flexible Option regulations except 2707.01, 2707.02, 2708.01,
and 2713.01 will pertain for these options.*
Trading shall be permitted in any CBOT recognized option/option or
option/futures spread involving puts, calls or futures. (09/01/00)
B2703.01 Trading Unit - The minimum size for requesting a quote and/or trading
in a flexible option series is 50 contracts, where each contract represents one
of the underlying futures contracts at the Chicago Board of Trade. Parties may
request a quote and/or trade for less than 50 contracts in order to entirely
close out a position in a flexible series.
For a flexible options series, respondents to a request for quote, must be
willing to trade at least 50 contracts, with the exception that a respondent may
trade less than 50 contracts if the respondent is entirely closing out a
position in the series. (07/01/99)
B2704.01 Strike Prices - Strike prices for flexible options must be specified
in points and 32nd's of points per Long Term Treasury Note futures contract.
However, for a Request for Quote (RFQ), strike prices may be specified in one
32nd point increments relative to the underlying futures contract. Strike prices
cannot be outside the range of the currently listed strike prices for standard
options. (06/01/95)
B2707.01 Exercise of Flexible Options - Notification of the intent to exercise
a flexible option must be received by the Clearing Corporation by 4:10 p.m.
Chicago time, or by such other time designated by the Board of Directors. No
exceptions to the 4:10 p.m. exercise deadline, or such other deadline designated
by the Board of Directors, shall be permitted.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2702.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
B2707.02 Automatic Exercise - After the close on the last day of trading, all
in-the-money flexible options will be automatically exercised unless notice to
cancel automatic exercise is given to the Clearing Corporation by 4:10 p.m., or
by such other time designated by the Board of Directors, on that day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2702.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
*B2708.01 Expiration Date - Flexible option expiration may be specified for any
Monday through Friday that is not an Exchange holiday except that expiration may
not occur following the last Friday that precedes by at least [five] two
business days the last business day of the calendar month preceding the
underlying future contract month. Flexible options expire at 4:30 p.m. on the
last trading
Ch27B Trading Conditions
------------------------
day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2702.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (04/01/00)
*Addition underlined; deletion bracketed for contracts from June 2001 forward.
B2709.01 Months Traded In - Trading my be conducted in flexible options in any
month up through the most distant underlying futures contract in which a trade
has occurred. (05/01/94)
B2713.01 Last Day of Trading - The last day of trading in a flexible option
shall be the expiration day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2702.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (05/01/94)
B2715.01 Exercise Style - Flexible options may be American or European
exercise style. (10/01/94)
B2716.01 Underlying Futures Contract for Flexible Options - The underlying
futures contract for a flexible option shall be the same as the underlying
futures contract month of the nearest March quarterly cycle standard futures
option expiring on or after the expiration of the flexible option. (10/01/94)
B2717.01 Initiating a Flexible Option Contract Series - For each trading
session, the opening of trading in any flexible option series shall occur
through the submission of an RFQ. If so desired, participants can submit
additional RFQ's for any open series during a trading day. However, in this
situation no priority period (Regulation 2719.01) will exist. (09/01/98)
B2719.01 RFQ Trading Interval - If the submitter of the first RFQ of the day
in a flexible series requests either a bid or an offer but not both, then they
shall have up to a two minute priority period during which they shall have the
sole right to either buy or sell as specified in their RFQ. The exact length of
the priority period shall be determined by the Exchange.
If more than one RFQ is the first RFQ of the day in a flexible series, all the
RFQ's individually ask for either a bid or an offer but not both, and all the
RFQ's collectively are for the same side of the market (all bids or all offers)
then the submitters shall jointly share priority during the priority period.
A flexible option series shall be immediately open for trading when any of the
following occurs:
(1) The priority period expires;
(2) Two or more RFQ's are jointly the first of the day and the RFQ's
contain requests for both sides of the market, or the RFQ's contain
requests for different sides of the market; or
(3) The first RFQ of the day requests both sides of the market.
Priority for RFQ's is determined by submission to the RFQ official, except that
all RFQ's submitted before the open shall be treated equally. (03/01/98)
B2720.01 Expiration of an RFQ - Trading in a given flexible option series
following an RFQ shall remain open for the remainder of the trading session.
(10/01/94)
B2721.01 Reporting of Flexible Option Trades - It shall be the responsibility
of the participants in a flexible option trade to report the quantities and
prices to the flexible pit reporter in a timely manner, including any later
trades in open flexible contract term series. (10/01/94)
* The effect of the second paragraph of Regulation 2702.03 is to permit
trading in standard options under certain Flexible trading procedures prior
to the listing of such options in the standard options pit or on e-cbot.
Once and if these options are listed for trading in the standard options
pit or on e-cbot, they will be traded only in the standard options pit or
on e-cbot subject to standard options trading requirements. Upon such
listing, all existing open positions established under Flexible trading
procedures shall be fully fungible with transactions in the respective
standard option series for all purposes under these regulations.
[Download Table]
================================================================================
Chapter 28A (Standard Options)
T-Bond Futures Options
================================================================================
Ch28A Trading Conditions.............................................
A2801.00 Authority..............................................
A2801.01 Application of Regulations.............................
A2802.01 Nature of U.S. Treasury Bond Futures Put Options.......
A2802.02 Nature of U.S. Treasury Bond Futures Call Options......
A2803.01 Trading Unit...........................................
A2804.01 Striking Prices........................................
A2805.01 Payment of Option Premium..............................
A2806.01 Option Premium Basis...................................
A2807.01 Exercise of Option.....................................
A2807.02 Automatic Exercise.....................................
A2808.01 Expiration of Option...................................
A2809.01 Months Traded In.......................................
A2810.01 Trading Hours..........................................
A2811.01 Position Limits and Reportable Positions...............
A2812.01 Margin Requirements....................................
A2813.01 Last Day of Trading....................................
A2814.01 Option Premium Fluctuation Limits......................
================================================================================
Chapter 28A (Standard Options)
T-Bond Futures Options
================================================================================
Ch28A Trading Conditions
A2801.00 Authority - Trading in put and call options on futures contracts and
on commodities may be conducted under such terms and conditions as may be
prescribed by regulation. (10/01/94).
A2801.01 Application of Regulations - Transactions in put and call options on
U.S. Treasury Bond futures contracts shall be subject to the general rules of
the Association as far as applicable and shall also be subject to the
regulations contained in this chapter which are exclusively applicable to
trading in put and call options on U.S. Treasury Bond futures contracts. (See
Rule 490.00) (09/01/00)
A2802.01 Nature of U.S. Treasury Bond Futures Put Options - The buyer of one
(1) U.S. Treasury Bond futures put option may exercise his option at any time
prior to expiration (subject to Regulation 2807.01), to assume a short position
in one (1) U.S. Treasury Bond futures contract of a specified contract month at
a striking price set at the time the option was purchased. The seller of one (1)
U.S. Treasury Bond futures put option incurs the obligation of assuming a long
position in one (1) U.S. Treasury Bond futures contract of a specified contract
month at a striking price set at the time the option was sold, upon exercise by
a put option buyer. (10/01/94)
A2802.02 Nature of U.S. Treasury Bond Futures Call Options - The buyer of one
(1) U.S. Treasury Bond futures call option may exercise his option at any time
prior to expiration (subject to Regulation 2807.01), to assume a long position
in one (1) U.S. Treasury Bond futures contract of a specified contract month at
a striking price set at the time the option was purchased. The seller of one (1)
U.S. Treasury Bond futures call option incurs the obligation of assuming a short
position in one (1) U.S. Treasury Bond futures contract of a specified contract
month at a striking price set at the time the option was sold, upon exercise by
a call option buyer. (10/01/94)
A2803.01 Trading Unit - One (1) $100,000 face value U.S. Treasury Bond futures
contract of a specified contract month on the Chicago Board of Trade. (10/01/94)
A2804.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of two (2) points and one (1) point
per U.S. Treasury Bond futures contract as follows: At the commencement of
trading for quarterly expirations the following strike prices in two point
intervals shall be listed: one with a striking price closest to the previous
day's settlement price on the underlying U.S. Treasury Bond futures contract,
the next fifteen consecutive higher and the next fifteen consecutive lower
striking prices closest to the previous day's settlement price; and all two
point strike prices listed for all other option contract months listed at the
time. If the previous day's settlement price is midway between two striking
prices, the closest striking price shall be the larger of the two. Over time new
two point striking prices will be added to ensure that at least fifteen two
point striking prices always exist above and below the previous day's trading
range in the underlying futures. When a new two point strike price is added for
an option contract month, the same strike price will be added to all option
contract months for which that strike price is not already listed. At the
commencement of trading for a non-quarterly expiration and for a quarterly
expiration on the day they become the second deferred month, the following
striking prices in one point intervals shall be listed: one with a striking
price closest to the U.S. Treasury Bond futures contract's previous day's
settlement price, the next thirty consecutive higher and lower striking prices
in one point intervals and all other striking prices in two point intervals that
exist for other option contract months. Over time, new one point striking prices
will be added to ensure that at least thirty one point striking prices always
exist above and below the previous day's trading range in the underlying
futures. All new strike prices will be added prior to the opening of trading on
the following business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (09/01/00)
A2805.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time
Ch28A Trading Conditions
------------------------
that the option is purchased, or within a reasonable time after the option is
purchased. (10/01/94)
A2806.01 Option Premium Basis - The Premium for U.S. Treasury Bond futures
options shall be in multiples of one sixty-fourth (1/64) of one percent (1%) of
a $100,000 U.S. Treasury Bond futures contract which shall equal $15.63 per 1/64
and $1,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract.
If options are quoted in volatility terms, the minimum fluctuation shall be .10
percent (i.e.-10.0%, 10.1%, 10.2%, etc.) (10/01/94)
A2807.01 Exercise of Option - The buyer of a U.S. Treasury Bond futures option
may exercise the option on any business day prior to expiration by giving notice
of exercise to the Clearing Corporation by 6:00 p.m., or by such other time
designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. on the
expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
A2807.02 Automatic Exercise - Notwithstanding the provisions of Regulation
2807.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
A2808.01 Expiration of Option - Unexercised U.S. Treasury Bond futures options
shall expire at 10:00 a.m. on the first Saturday following the last day of
trading. (10/01/94)
A2809.01 Months Traded In - Trading may be conducted in U.S. Treasury Bond
futures options for a thirty-six month period extending from the nearby contract
month, provided however, that the Exchange may determine not to list a contract
month. Both serial and quarterly options may be listed to expire into either
front-month or deferred futures as determined by the Board. (06/01/99)
A2810.01 Trading Hours - The hours of trading of options on U.S. Treasury Bond
futures contracts shall be determined by the Board. On the last day of trading
in an expiring option, the closing time for such options shall be the same as
the close of trading of the Regular Daytime open outcry trading session for the
corresponding U.S. Treasury Bond futures contract, subject to the provisions of
the second paragraph of Rule 1007.00. U.S. Treasury Bond futures options shall
be opened and closed for all months and strike prices simultaneously or in such
a manner as the Regulatory Compliance Committee shall direct. (04/01/00)
A2811.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
A2812.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*A2813.01 Last Day of Trading - No trades in U.S. Treasury Bond futures options
expiring in the current month shall be made after the close of trading of the
Regular Daytime open outcry trading session for the corresponding U.S. Treasury
Bond futures contract on the last Friday which precedes by at least two [five]
business days, the last business day of the month preceding the option month. If
such Friday is not a business day, or there is a Friday which is not a business
day which precedes by
Ch28A Trading Conditions
------------------------
one [four] business day[s] the last business day of the month preceding the
option month, the last day of trading shall be the business day prior to such
Friday. (03/01/00)
* Additions underlined; deletions bracketed for contracts from June 2001
forward.
A2814.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a U.S. Treasury Bond futures option at
a premium of more than the trading limit for the U.S. Treasury Bond futures
contract above and below the previous day's settlement premium for that option
as determined by the Clearing Corporation. On the first day of trading, limits
shall be set from the lowest premium of the opening range. (10/01/94)
================================================================================
Chapter 28B (Flexible Options)
Treasury Bond Flexible Options
================================================================================
Ch28B Trading Conditions.........................................
B2802.03 Nature of Flexible Options.........................
B2803.01 Trading Unit.......................................
B2804.01 Strike Prices......................................
B2807.01 Exercise of Flexible Options.......................
B2807.02 Automatic Exercise.................................
B2808.01 Expiration Date....................................
B2809.01 Months Traded In...................................
B2813.01 Last Day of Trading................................
B2815.01 Exercise Style.....................................
B2816.01 Underlying Futures Contract for Flexible Options...
B2817.01 Initiating a Flexible Option Contract Series.......
B2819.01 RFQ Trading Interval...............................
B2820.01 Expiration of an RFQ...............................
B2821.01 Reporting of Flexible Option Trades................
================================================================================
Chapter 28B (Flexible Options)
Treasury Bond Flexible Options
================================================================================
Note: The following Flexible option regulations with the exception noted in
the second paragraph of Regulation 2802.03 supersede the
corresponding standard regulations presented in Part A of this
chapter. Regulations 2801.00, 2801.01, 2802.01, 2802.02, 2805.01,
2806.01, 2810.01, 2811.01, 2812.01, and 2814.01 remain in effect for
both standard and Flexible options.
Ch28B Trading Conditions
B2802.03 Nature of Flexible Options - Flexible options on U.S. Treasury Bond
futures shall be permitted in puts and calls which do not have the same
underlying futures contract, same strike price, same exercise style, and same
last day of trading as standard options.
However, Flexible Options on U.S. Treasury Bond futures shall also be permitted
in puts and calls which have the same underlying futures contract, same strike
price, same exercise style, and same last day of trading as standard options
that are not at the time listed for trading in the standard options pit or on e-
cbot. All Flexible Option regulations except 2807.01, 2807.02, 2808.01, and
2813.01 will pertain for these options.*
Trading shall be permitted in any CBOT recognized option/option or
option/futures spread involving puts, calls or futures. (09/01/00)
B2803.01 Trading Unit - The minimum size for requesting a quote and/or trading
in a flexible option series is 50 contracts, where each contract represents one
of the underlying futures contracts at the Chicago Board of Trade. Parties may
request a quote and/or trade for less than 50 contracts in order to entirely
close out a position in a flexible series.
For a flexible options series, respondents to a request for quote, must be
willing to trade at least 50 contracts, with the exception that a respondent may
trade less than 50 contracts if the respondent is entirely closing out a
position in the series. (07/01/99)
B2804.01 Strike Prices - Strike prices for flexible options must be specified in
points and 32nd's of points per U.S. Treasury Bond futures contract. However,
for a Request for Quote (RFQ), strike prices may be specified in one 32nd point
increments relative to the underlying futures contract. Strike prices cannot be
outside the range of the currently listed strike prices for standard options.
(06/01/95)
B2807.01 Exercise of Flexible Options - Notification of the intent to exercise a
flexible option must be received by the Clearing Corporation by 4:10 p.m.
Chicago time, or by such other time designated by the Board of Directors. No
exceptions to the 4:10 p.m. exercise deadline, or such other deadline designated
by the Board of Directors, shall be permitted.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2802.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
B2807.02 Automatic Exercise - After the close on the last day of trading, all
in-the-money flexible options will be automatically exercised unless notice to
cancel automatic exercise is given to the Clearing Corporation by 4:10 p.m., or
by such other time designated by the Board of Directors, on that day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2802.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
*B2808.01 Expiration Date - Flexible option expiration may be specified for any
Monday through Friday that is not an Exchange holiday except that expiration may
not occur following the last Friday that precedes by at least [five] two
business days the last business day of the calendar month preceding the
underlying future contract month. Flexible options expire at 4:30 p.m. on the
last trading
Ch28b Trading Conditions
------------------------
day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2902.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (04/01/00)
*Addition underlined; deletion bracketed for contracts from June 2001 forward.
B2809.01 Months Traded In - Trading may be conducted in flexible options in any
month up through the most distant underlying futures contract in which a trade
has occurred. (10/01/94)
B2813.01 Last Day of Trading - The last day of trading in a flexible option
shall be the expiration day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 2802.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (05/01/94)
B2815.01 Exercise Style - Flexible options may be American or European exercise
style. (10/01/94)
B2816.01 Underlying Futures Contract for Flexible Options - The underlying
futures contract for a flexible option shall be the same as the underlying
futures contract month of the nearest March quarterly cycle standard futures
option expiring on or after the expiration of the flexible option. (10/01/94)
B2817.01 Initiating a Flexible Option Contract Series - For each trading
session, the opening of trading in any flexible option series shall occur
through the submission of an RFQ.
If so desired, participants can submit additional RFQ's for any open series
during a trading day. However, in this situation no priority period (Regulation
2819.01) will exist. (09/01/98)
B2819.01 RFQ Trading Interval - If the submitter of the first RFQ of the day in
a flexible series requests either a bid or an offer but not both, then they
shall have up to a two minute priority period during which they shall have the
sole right to either buy or sell as specified in their RFQ. The exact length of
the priority period shall be determined by the Exchange.
If more than one RFQ is the first RFQ of the day in a flexible series, all the
RFQ's individually ask for either a bid or an offer but not both, and all the
RFQ's collectively are for the same side of the market (all bids or all offers)
then the submitters shall jointly share priority during the period.
A flexible option series shall be immediately open for trading when any of the
following occurs:
(1) The priority period expires;
(2) Two or more RFQ's are jointly the first of the day and the RFQ's
contain requests for both sides of the market, or the RFQ's contain
requests for different sides of the market; or
(3) The first RFQ of the day requests both sides of the market.
Priority for RFQ's is determined by submission to the RFQ official, except that
all RFQ's submitted before the open shall be treated equally. (03/01/98)
B2820.01 Expiration of an RFQ - Trading in a given flexible option series
following an RFQ shall remain open for the remainder of the trading session.
(10/01/94)
B2821.01 Reporting of Flexible Option Trades - It shall be the responsibility of
the participants in a flexible option trade to report the quantities and prices
to the flexible pit reporter in a timely manner,
including any later trades in open flexible contract term series. (10/01/94)
* The effect of the second paragraph of Regulation 2802.03 is to permit
trading in standard options under certain Flexible trading procedures prior
to the listing of such options in the standard options pit or e-cbot. Once
and if these options are listed for trading in the standard options pit or
on e-cbot, they will be traded only in the standard options pit or on e-cbot
subject to standard options trading requirements. Upon such listing, all
existing open positions established under Flexible trading procedures shall
be fully fungible with transactions in the respective standard option series
for all purposes under these regulations.
for all purposes under these regulations.
2808B
[Download Table]
================================================================================
Chapter 29
Soybean Futures Options
================================================================================
Ch29 Trading Conditions.............................................. 2902
2901.00 Authority.............................................. 2902
2901.01 Application of Regulations............................. 2902
2902.01 Nature of Soybean Futures Put Options.................. 2902
2902.02 Nature of Soybean Futures Call Options................. 2902
2903.01 Trading Unit........................................... 2902
2904.01 Striking Prices........................................ 2902
2905.01 Payment of Option Premium.............................. 2903
2906.01 Option Premium Basis................................... 2903
2907.01 Exercise of Option..................................... 2903
2907.02 Automatic Exercise..................................... 2903
2908.01 Expiration of Option................................... 2903
2909.01 Months Traded.......................................... 2903
2910.01 Trading Hours.......................................... 2904
2911.01 Position Limits and Reportable Positions............... 2904
2912.01 Margin Requirements.................................... 2904
2913.01 Last Day of Trading.................................... 2904
2914.01 Option Premium Fluctuation Limits...................... 2904
================================================================================
Chapter 29
Soybean Futures Options
================================================================================
Ch29 Trading Conditions
2901.00 Authority - (See Rule 2801.00). (10/01/94)
2901.01 Application of Regulations - Transactions in put and call options on
Soybean futures contracts shall be subject to the general rules of the
Association as far as applicable and shall also be subject to the regulations
contained in this chapter which are exclusively applicable to trading in put and
call options on Soybean futures contracts. (See Rule 490.00). (10/01/94)
2902.01 Nature of Soybean Futures Put Options - The buyer of one (1) Soybean
futures put option may exercise his option at any time prior to expiration,
(subject to Regulation 2907.01), to assume a short position in one (1) Soybean
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Soybean futures put option
incurs the obligation of assuming a long position in one (1) Soybean futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a put option buyer. (10/01/94)
2902.02 Nature of Soybean Futures Call Options - The buyer of one (1) Soybean
futures call option may exercise his option at any time prior to expiration,
(subject to Regulation 2907.01), to assume a long position in one (1) Soybean
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Soybean futures call
option incurs the obligation of assuming a short position in one (1) Soybean
futures contract of a specified contract month at a striking price set at the
time the option was sold, upon exercise by a call option buyer. (10/01/94)
2903.01 Trading Unit - One (1) 5,000 bushel Soybean futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
2904.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of ten (10) cents per
bushel per Soybean futures contract (i.e., 6.10, 6.20, 6.30, etc) in integral
multiples of twenty (20) cents per bushel per Soybean futures contract (i.e.,
6.20, 6.40, 6.60, etc.) and in integral multiples of forty (40) cents per bushel
per Soybean futures contract (i.e., 6.00, 6.40, 6.80, etc.) as follows:
1. a. In integral multiples of twenty cents, at the commencement of trading
for an option contract, the following strikes shall be listed: one with
a strike closest to the previous day's settlement price of the
underlying Soybean futures contract, the next five consecutive higher
and the next five consecutive lower strikes (the "initial band"). If
the previous day's settlement price is midway between two strikes, the
closest price shall be the larger of the two.
b. In integral multiples of forty cents, at the commencement of trading
for an option contract, the following strikes shall be listed: the next
four consecutive strikes above the initial band.
c. In integral multiples of twenty cents, over time, strikes shall be
added as necessary to ensure that all strikes within $1.10 of the
previous day's trading range of the underlying futures contract are
listed (the "minimum band").
d. In integral multiples of forty cents, over time, strikes shall be added
as necessary to ensure that the next four consecutive strikes above the
minimum band are listed.
e. No new strikes may be added by these procedures in the month in which
an option expires.
2. a. In integral multiples of ten cents, at the commencement of trading for
options that are traded in months in which Soybean futures are not
traded, and for standard option months, the business day they become
the second deferred month, the following strike prices shall be listed:
one with a strike closest to the previous day's settlement price of the
underlying Soybean futures contract and the next five consecutive
higher and the next five consecutive
Ch29 Trading Conditions
-----------------------
lower strikes. For example, ten-cent strike price intervals for the
September 2000 contract month would be added on June 26, which is the
business day after the expiration of the July contract month.
b. Over time, new ten-cent strike prices will be added to ensure that at
least five strike prices exist above and below the previous day's
trading range in the underlying futures.
3. a. In integral multiples of forty cents, all strikes in which the
previous day's delta factors (as determined by the Board of Trade) for
both the put and call options are 0.10 or greater for two consecutive
business days will be listed for trading. However, no new strikes may
be added by this procedure to an option month unless open positions
exist in that contract month.
b. In integral multiples of twenty cents, during the month in which an
option expires, all strikes in which the previous day's delta factors
(as determined by the Board of Trade) for both the put and call options
are 0.10 or greater for two consecutive business days will be listed
for trading.
4. All strikes will be listed prior to the opening of trading on the following
business day. The Exchange may modify the procedures for the introduction
of strikes as it deems appropriate in order to respond to market
conditions. (09/01/00)
2905.01 Payment of Option Premium - The option premium must be paid in full
by each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
2906.01 Option Premium Basis - The premium for Soybean futures options shall
be in multiples of one-eighth (1/8) of one cent per bushel of a 5,000 bushel
Soybean futures contract which shall equal $6.25 per contract.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $6.00 in $1.00 increments per option contract.
(10/01/94)
2907.01 Exercise of Option - The buyer of a Soybean futures option may
exercise the option on any business day prior to expiration by giving notice of
exercise to the Clearing Corporation by 6:00 p.m., or by such other time
designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. on expiration
date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of
trading. (12/01/99)
2907.02 Automatic Exercise - Notwithstanding the provisions of Regulation
2907.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of
trading. (12/01/99)
2908.01 Expiration of Option - Unexercised Soybean futures options shall expire
at 10:00 a.m. on the first Saturday following the last day of trading.
(10/01/94)
2909.01 Months Traded - Trading may be conducted in the nearby Soybean futures
options
Ch29 Trading Conditions
-----------------------
contract month plus any succeeding months, provided however, that the Exchange
may determine not to list a contract month. For options that are traded in
months in which Soybean futures are not traded, the underlying futures contract
is the next futures contract that is nearest to the expiration of the option.
For example, the underlying futures contract for the February option contract is
the March futures contract. (09/01/00)
2910.01 Trading Hours - The hours of trading of options on Soybean futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as the
close of trading of the Regular Daytime open outcry trading session for the
corresponding Soybean futures contract, subject to the provisions of the second
paragraph of Rule 1007.00. On the last day of trading in an expiring option, the
expiring Soybean futures options shall be closed with a public call made
striking price by striking price, conducted by such persons as the Regulatory
Compliance Committee shall direct. On all other days, Soybean futures options
shall be opened and closed for all months and striking prices simultaneously or
in such a manner as the Regulatory Compliance Committee shall direct. (03/01/00)
2911.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
2912.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*2913.01 Last Day of Trading - No trades in Soybean futures options expiring
in the current month shall be made after the close of trading of the Regular
Daytime open outcry trading session for the corresponding Soybean futures
contract on the last Friday which precedes by at least two [five] business days,
the last business day of the month preceding the option month. If such Friday is
not a business day, the last day of trading shall be the business day prior to
such Friday. (03/01/00)
* Additions underlined; deletions bracketed for contracts from May 2001 forward.
2914.01 Option Premium Fluctuation Limits -Trading is prohibited during any
day except for the last day of trading in a Soybean futures option at a premium
of more than the trading limit for the Soybean futures contract above and below
the previous day's settlement premium for that option as determined by the
Clearing Corporation. On the first day of trading, limits shall be set from the
lowest premium of the opening range. (10/01/94)
================================================================================
Chapter 30
Corn Futures Options
================================================================================
Ch30 Trading Conditions..................................
3001.00 Authority..................................
3001.01 Application of Regulations.................
3002.01 Nature of Corn Futures Put Options.........
3002.02 Nature of Corn Futures Call Options........
3003.01 Trading Unit...............................
3004.01 Striking Prices............................
3005.01 Payment of Option Premium..................
3006.01 Option Premium Basis.......................
3007.01 Exercise of Option.........................
3007.02 Automatic Exercise.........................
3008.01 Expiration of Option.......................
3009.01 Months Traded..............................
3010.01 Trading Hours..............................
3011.01 Position Limits............................
3012.01 Margin Requirements........................
3013.01 Last Day of Trading........................
3014.01 Option Premium Fluctuation Limits..........
================================================================================
Chapter 30
Corn Futures Options
================================================================================
Ch30 Trading Conditions
3001.00 Authority - (See Rule 2801.00). (10/01/94)
3001.01 Application of Regulations - Transactions in put and call options on
Corn futures contracts shall be subject to the general rules of the Association
as far as applicable and shall also be subject to the regulations contained in
this chapter which are exclusively applicable to trading in put and call options
on Corn futures contracts. (See Rule 490.00). (10/01/94)
3002.01 Nature of Corn Futures Put Options - The buyer of one (1) Corn futures
put option may exercise his option at any time prior to expiration, (subject to
Regulation 3007.01), to assume a short position in one (1) Corn futures contract
of a specified contract month at a striking price set at the time the option was
purchased. The seller of one (1) Corn futures put option incurs the obligation
of assuming a long position in one (1) Corn futures contract of a specified
contract month at a striking price set at the time the option was sold, upon
exercise by a put option buyer. (10/01/94)
3002.02 Nature of Corn Futures Call Options - The buyer of one (1) Corn futures
call option may exercise his option at any time prior to expiration, (subject to
Regulation 3007.01), to assume a long position in one (1) Corn futures contract
of a specified contract month at a striking price set at the time the option was
purchased. The seller of one (1) Corn futures call option incurs the obligation
of assuming a short position in one (1) Corn futures contract of a specified
contract month at a striking price set at the time the option was sold, upon
exercise by a call option buyer. (10/01/94)
3003.01 Trading Unit - One (1) 5,000 bushel Corn futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
3004.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of five (5) cents per
bushel per Corn futures contract (i.e., 2.55, 2.60, 2.65, etc.), in integral
multiples of ten (10) cents per bushel per Corn futures contract (i.e., 2.50,
2.60, 2.70, etc.) and in integral multiples of twenty (20) cents per bushel per
Corn futures contract (i.e., 2.80, 3.00, 3.20, etc.) as follows:
1. a. In integral multiples of ten cents, at the commencement of trading
for an option contract, the following strikes shall be listed: one with
a strike closest to the previous day's settlement price of the
underlying Corn futures contract, the next five consecutive higher and
the next five consecutive lower strikes (the "initial band"). If the
previous day's settlement price is midway between two strikes, the
closest price shall be the larger of the two.
b. In integral multiples of twenty cents, at the commencement of trading
for an option contract, the following strikes shall be listed: the next
four consecutive strikes above the initial band.
c. In integral multiples of ten cents, over time, strikes shall be added as
necessary to ensure that all strikes within 55 cents of the previous
day's trading range of the underlying futures contract are listed (the
"minimum band").
d. In integral multiples of twenty cents, over time, strikes shall be added
as necessary to ensure that the next four consecutive strikes above the
minimum band are listed.
e. No new strikes may be added by these procedures in the month in which an
option expires.
2. a. In integral multiples of five cents, at the commencement of trading
for options that are traded in months in which Corn futures are not
traded, and for standard option months, the business day they become the
second deferred month, the following strike prices shall be listed: one
with a strike closest to the previous day's settlement price of the
underlying Corn futures contract and the next five consecutive higher
and the next five consecutive lower strikes. For example, five-cent
strike price intervals for the September 2000 contract month would be
added on June 26, which is the business day after the expiration of the
July
Ch30 Trading Conditions
-----------------------
contract month.
b. Over time, new-five cent strike prices will be added to ensure that at
least five strike prices exist above and below the previous day's
trading range in the underlying futures.
3. a. In integral multiples of twenty cents, all strikes in which the previous
day's delta factors (as determined by the Board of Trade) for both the
put and call options are 0.10 or greater for two consecutive business
days will be listed for trading. However, no new strikes may be added by
this procedure to an option month unless open positions exist in that
contract month.
b. In integral multiples of ten cents, during the month in which an option
expires, all strikes in which the previous day's delta factors (as
determined by the Board of Trade) for both the put and call options are
0.10 or greater for two consecutive business days will be listed for
trading.
4. All strikes will be listed prior to the opening of trading on the following
business day. The Exchange may modify the procedures for the introduction of
strikes as it deems appropriate in order to respond to market conditions.
(09/01/00)
3005.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
3006.01 Option Premium Basis - The premium for Corn futures options shall be in
multiples of one-eighth (1/8) of one cent per bushel of a 5,000 bushel Corn
futures contract which shall equal $6.25 per contract.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $6.00 in $1.00 increments per option contract.
(10/01/94)
3007.01 Exercise of Option - The buyer of a Corn futures option may exercise
the option on any business day prior to expiration by giving notice of exercise
to the Clearing Corporation by 6:00 p.m., or by such other time designated by
the Board of Directors, on such day. Notwithstanding the foregoing, the buyer
may exercise the option prior to 10:00 a.m. on expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of
trading. (12/01/99)
3007.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3007.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange
option transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of
trading. (12/01/99)
3008.01 Expiration of Option - Unexercised Corn futures options shall expire at
10:00 a.m. on the first Saturday following the last day of trading. (10/01/94)
3009.01 Months Traded - Trading may be conducted in the nearby Corn futures
options contract
Ch30 Trading Conditions
-----------------------
month plus any succeeding months, provided however, that the Exchange may
determine not to list a contract month. For options that are traded in months in
which Corn futures are not trading underlying futures contract is the next
futures contract that is nearest to the expiration of the option. For example,
the underlying futures contract for the February option contract is the March
futures contract. (09/01/00)
3010.01 Trading Hours - The hours of trading of options on Corn futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as close of
trading of the Regular Daytime open outcry trading session for the corresponding
Corn futures contract, subject to the provisions of the second paragraph of Rule
1007.00. On the last day of trading in an expiring option, the expiring Corn
futures options shall be closed with a public call made striking price by
striking price, conducted by such persons as the Regulatory Compliance Committee
shall direct. On all other days, Corn futures options shall be opened and closed
for all months and striking prices simultaneously or in such a manner as the
Regulatory Compliance Committee shall direct. (03/01/00)
3011.01 Position Limits - (See Regulation 425.01) (10/01/00)
3012.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*3013.01 Last Day of Trading - No trades in Corn futures options expiring in the
current month shall be made after the close of trading of the Regular Daytime
open outcry trading session for the corresponding Corn futures contract on the
last Friday which precedes by at least two [five] business days, the last
business day of the month preceding the option month. If such Friday is not a
business day, the last day of trading shall be the business day prior to such
Friday. (03/01/00)
* Additions underlined; deletions bracketed for contracts from May 2001 forward
3014.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Corn futures option at a premium of
more than the trading limit for the Corn futures contract above and below the
previous day's settlement premium for that option as determined by the Clearing
Corporation. On the first day of trading, limits shall be set from the lowest
premium of the opening range. (10/01/94)
================================================================================
Chapter 31
Wheat Futures Options
================================================================================
Ch31 Trading Conditions.................................
3101.00 Authority.................................
3101.01 Application of Regulations................
3102.01 Nature of Wheat Futures Put Options.......
3102.02 Nature of Wheat Futures Call Options......
3103.01 Trading Unit..............................
3104.01 Striking Prices...........................
3105.01 Payment of Option Premium.................
3106.01 Option Premium Basis......................
3107.01 Exercise of Option........................
3107.02 Automatic Exercise........................
3108.01 Expiration of Option......................
3109.01 Months Traded.............................
3110.01 Trading Hours.............................
3111.01 Position Limits...........................
3112.01 Margin Requirements.......................
3113.01 Last Day of Trading.......................
3114.01 Option Premium Fluctuation Limits.........
================================================================================
Chapter 31
Wheat Futures Options
================================================================================
Ch31 Trading Conditions
3101.00 Authority - (See Rule 2801.00). (10/01/94)
3101.01 Application of Regulations - Transactions in put and call options on
Wheat futures contracts shall be subject to the general rules of the Association
as far as applicable and shall also be subject to the regulations contained in
this chapter which are exclusively applicable to trading in put and call options
on Wheat futures contracts. (See Rule 490.00). (10/01/94)
3102.01 Nature of Wheat Futures Put Options - The buyer of one (1) Wheat
futures put option may exercise his option at any time prior to expiration,
(subject to Regulation 3107.01), to assume a short position in one (1) Wheat
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Wheat futures put option
incurs the obligation of assuming a long position in one (1) Wheat futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a put option buyer. (10/01/94)
3102.02 Nature of Wheat Futures Call Options - The buyer of one (1) Wheat
futures call option may exercise his option at any time prior to expiration,
(subject to Regulation 3107.01), to assume a long position in one (1) Wheat
futures contract of a specified contract month at a striking price set at the
time the option was purchased. The seller of one (1) Wheat futures call option
incurs the obligation of assuming a short position in one (1) Wheat futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a call option buyer. (10/01/94)
3103.01 Trading Unit - One (1) 5,000 bushel Wheat futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
3104.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of five (5) cents per
bushel per Wheat futures contract (i.e. 3.70, 3.75, 3.80, etc.), in integral
multiples of ten (10) cents per bushel per Wheat futures contract (i.e., 3.70,
3.80, 3.90, etc.) and in integral multiples of twenty (20) cents per bushel per
Wheat futures contract (i.e., 4.00, 4.20, 4.40, etc.) as follows:
1. a. In integral multiples of ten cents, at the commencement of trading for
an option contract, the following strikes shall be listed: one with a
strike closest to the previous day's settlement price of the underlying
Wheat futures contract, the next five consecutive higher and the next
five consecutive lower strikes (the "initial band"). If the previous
day's settlement price is midway between two strikes, the closest price
shall be the larger of the two.
b. In integral multiples of twenty cents, at the commencement of trading
for an option contract, the following strikes shall be listed: the next
four consecutive strikes above the initial band.
c. In integral multiples of ten cents, over time, strikes shall be added
as necessary to ensure that all strikes within 55 cents of the previous
day's trading range of the underlying futures contract are listed (the
"minimum band").
d. In integral multiples of twenty cents, over time, strikes shall be
added as necessary to ensure that the next four consecutive strikes
above the minimum band are listed.
e. No new strikes may be added by these procedures in the month in which
an option expires.
2. a. In integral multiples of five cents, at the commencement of trading for
options that are traded in months in which Wheat futures are not
traded, and for standard option months, the business day they become
the second deferred month, the following strike prices shall be listed:
one with a strike closest to the previous day's settlement price of the
underlying Wheat futures contract and the next five consecutive higher
and the next five consecutive lower strikes. For example, five-cent
strike price intervals for the September 2000 contract month would be
added on June 26, which is the business day after the expiration of the
July
Ch31 Trading Conditions
-----------------------
contract month.
b. Over time, new five-cent strike prices will be added to ensure that at
least five strike prices exist above and below the previous day's
trading range in the underlying futures.
3. a. In integral multiples of twenty cents, all strikes in which the
previous day's delta factors (as determined by the Board of Trade) for
both the put and call options are 0.10 or greater for two consecutive
business days will be listed for trading. However, no new strikes may
be added by this procedure to an option month unless open positions
exist in that contract month.
b. In integral multiples of ten cents, during the month in which an option
expires, all strikes in which the previous day's delta factors (as
determined by the Board of Trade) for both the put and call options are
0.10 or greater for two consecutive business days will be listed for
trading.
4. All strikes will be listed prior to the opening of trading on the following
business day. The Exchange may modify the procedures for the introduction
of strikes as it deems appropriate in order to respond to market
conditions. (09/01/00)
3105.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
3106.01 Option Premium Basis - The premium for Wheat futures options shall be
in multiples of one-eighth (1/8) of one cent per bushel of a 5,000 bushel Wheat
futures contract which shall equal $6.25 per contract.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $6.00 in $1.00 increments per option contract.
(10/01/94)
3107.01 Exercise of Option - The buyer of a Wheat futures option may exercise
the option on any business day prior to expiration by giving notice of exercise
to the Clearing Corporation by 6:00 p.m., or by such other time designated by
the Board of Directors, on such day. Notwithstanding the foregoing, the buyer
may exercise the option prior to 10:00 a.m. on expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
3107.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3107.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
3108.01 Expiration of Option - Unexercised Wheat futures options shall expire
at 10:00 a.m. on the first Saturday following the last day of trading.
(10/01/94)
3109.01 Months Traded - Trading may be conducted in the nearby Wheat futures
options
Ch31 Trading Conditions
-----------------------
contract month plus any succeeding months, provided however, that the Exchange
may determine not to list a contract month. For options that are traded in
months in which Wheat futures are not traded, the underlying futures contract is
the next futures contract that is nearest to the expiration of the option. For
example, the underlying futures contract for the February option contract is the
March futures contract. (09/01/00)
3110.01 Trading Hours - The hours of trading of options on Wheat futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as the
close of trading of the Regular Daytime open outcry trading session for the
corresponding Wheat futures contract, subject to the provisions of the second
paragraph of Rule 1007.00. On the last day of trading in an expiring option, the
expiring Wheat futures options shall be closed with a public call made striking
price by striking price, conducted by such persons as the Regulatory Compliance
Committee shall direct. On all other days, Wheat futures options shall be opened
and closed for all months and striking prices simultaneously or in such a manner
as the Regulatory Compliance Committee shall direct. (03/01/00)
3111.01 Position Limits - (See Regulation 425.01) (10/01/00)
3112.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*3113.01 Last Day of Trading - No trades in Wheat futures options expiring in
the current month shall be made after the close of trading of the Regular
Daytime open outcry trading session for the corresponding Wheat futures contract
on the last Friday which precedes by at least two [five] business days, the last
business day of the month preceding the option month. If such Friday is not a
business day, the last day of trading shall be the business day prior to such
Friday. (03/01/00)
*Additions underlined, deletions bracketed for contracts from May 2001 forward.
3114.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Wheat futures option at a premium of
more than the trading limit for the Wheat futures contract above and below the
previous day's settlement premium for that option as determined by the Clearing
Corporation. On the first day of trading, limits shall be set from the lowest
premium of the opening range. (10/01/94)
================================================================================
Chapter 32
Soybean Oil Futures Options
================================================================================
Ch32 Trading Conditions...................................
3201.00 Authority...................................
3201.01 Application of Regulations..................
3202.01 Nature of Soybean Oil Futures Put Options...
3202.02 Nature of Soybean Oil Futures Call Options..
3203.01 Trading Unit................................
3204.01 Striking Prices.............................
3205.01 Payment of Option Premium...................
3206.01 Option Premium Basis........................
3207.01 Exercise of Option..........................
3207.02 Automatic Exercise..........................
3208.01 Expiration of Option........................
3209.01 Months Traded...............................
3210.01 Trading Hours...............................
3211.01 Position Limits and Reportable Positions....
3212.01 Margin Requirements.........................
3213.01 Last Day of Trading.........................
3214.01 Option Premium Fluctuation Limits...........
================================================================================
Chapter 32
Soybean Oil Futures Options
================================================================================
Ch32 Trading Conditions
3201.00 Authority - (See Rule 2801.00). (10/01/94)
3201.01 Application of Regulations - Transactions in put and call options on
Soybean Oil futures contracts shall be subject to the general rules of the
Association as far as applicable and shall also be subject to the regulations
contained in this chapter which are exclusively applicable to trading in put and
call options on Soybean Oil futures contracts. (See Rule 490.00). (10/01/94)
3202.01 Nature of Soybean Oil Futures Put Options - The buyer of one (1)
Soybean Oil futures put option may exercise his option at any time prior to
expiration, (subject to Regulation 3207.01), to assume a short position in one
(1) Soybean Oil futures contract of a specified contract month at a striking
price set at the time the option was purchased. The seller of one (1) Soybean
Oil futures put option incurs the obligation of assuming a long position in one
(1) Soybean Oil futures contract of a specified contract month at a striking
price set at the time the option was sold, upon exercise by a put option buyer.
(10/01/94)
3202.02 Nature of Soybean Oil Futures Call Options - The buyer of one (1)
Soybean Oil futures call option may exercise his option at any time prior to
expiration, (subject to Regulation 3207.01), to assume a long position in one
(1) Soybean Oil futures contract of a specified contract month at a striking
price set at the time the option was purchased. The seller of one (1) Soybean
Oil futures call option incurs the obligation of assuming a short position in
one (1) Soybean Oil futures contract of a specified contract month at a striking
price set at the time the option was sold, upon exercise by a call option buyer.
(10/01/94)
3203.01 Trading Unit - One (1) 60,000 pound Soybean Oil futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
3204.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of one-half cent per
pound per Soybean Oil futures contract (i.e., .210, .215, .220, etc.) for all
strikes less than thirty cents and in integral multiples of one cent per pound
per Soybean Oil futures contract (i.e., .300, .310, .320, etc.) for all strikes
greater than or equal to thirty cents (the "first tier"); and in integral
multiples of one cent per pound per Soybean Oil futures contract (i.e., .210,
.220, .230, etc.) for all strikes less than thirty cents and in integral
multiples of two cents per pound per Soybean Oil futures contract (i.e., .320,
.340, .360, etc.) for all strikes greater than or equal to thirty cents (the
"second tier") as follows:
1. a. Per the first tier, at the commencement of trading for an option
contract, the following strikes shall be listed: one with a strike
closest to the previous day's settlement price of the underlying
Soybean Oil futures contract and a consecutive series within 5.5 cents
above and below that strike (the "initial band"). If the previous day's
settlement price is midway between two strikes, the closest price shall
be the larger of the two.
b. Per the second tier, at the commencement of trading for an option
contract, the following strikes shall be listed: the next four
consecutive strikes above the initial band.
c. Per the first tier, over time, strikes shall be added as necessary to
insure that all strikes within 5.5 cents of the previous day's trading
range of the underlying futures contract are listed (the "minimum
band").
d. Per the second tier, over time, strikes shall be added as necessary to
insure that the next four consecutive strikes above the minimum band
are listed.
e. No new strikes may be added by these procedures in the month in which
an option expires.
2. a. Per the second tier, all strikes in which the previous day's delta
factors (as determined by the Board of Trade) for both the put and call
options are 0.10 or greater for two consecutive
Ch32 Trading Conditions
-----------------------
business days will be listed for trading. However, no new strikes may
be added by this procedure to an option month unless open positions
exist in that contract month.
b. Per the first tier, during the month in which an option expires, all
strikes in which the previous day's delta factors (as determined by the
Board of Trade) for both the put and call options are 0.10 or greater
for two consecutive business days will be listed for trading.
3. All strikes will be listed prior to the opening of trading on the following
business day. The Exchange may modify the procedures for the introduction
of strikes as it deems appropriate in order to respond to market
conditions. (07/01/95)
3205.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
3206.01 Option Premium Basis - The premium for Soybean Oil futures options
shall be in multiples of five thousandths (5/1000) of one cent per pound of a
60,000 pound Soybean Oil futures contract which shall equal $3.00 per contract.
However, when both sides of the trade are closing transactions, the option
premium may be equal to $1.00 or $2.00 per option contract. (10/01/94)
3207.01 Exercise of Option - The buyer of a Soybean Oil futures option may
exercise the option on any business day prior to expiration by giving notice of
exercise to the Clearing Corporation by 6:00 p.m., or by such other time
designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. on expiration
date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
3207.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3207.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
3208.01 Expiration of Option - Unexercised Soybean Oil futures options shall
expire at 10:00 a.m. on the first Saturday following the last day of trading.
(10/01/94)
3209.01 Months Traded - Trading may be conducted in the nearby Soybean Oil
futures options contract month plus any succeeding months, provided however,
that the Exchange may determine not to list a contract month. For options that
are traded in months in which Soybean Oil futures are not traded, the underlying
futures contract is the next futures contract that is nearest to the expiration
of the option. For example, the underlying futures contract for the February
option contract is the March futures contract. (09/01/00)
3210.01 Trading Hours - The hours of trading of options on Soybean Oil futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as the
close of trading of the Regular Daytime open outcry trading session for the
corresponding Soybean Oil futures contract, subject to the provisions of the
second paragraph
Ch32 Trading Conditions
-----------------------
of Rule 1007.00. On the last day of trading in an expiring option, the expiring
Soybean Oil futures options shall be closed with a public call made striking
price by striking price, conducted by such persons as the Regulatory Compliance
Committee shall direct. On all other days, Soybean Oil futures options shall be
opened and closed for all months and striking prices simultaneously or in such a
manner as the Regulatory Compliance Committee shall direct. (03/01/00)
3211.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
3212.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*3213.01 Last Day of Trading - No trades in Soybean Oil futures options expiring
in the current month shall be made after the close of trading of the Regular
Daytime open outcry trading session for the corresponding Soybean Oil futures
contract on the last Friday which precedes by at least two [five] business days,
the last business day of the month preceding the option month. If such Friday is
not a business day, the last day of trading shall be the business day prior to
such Friday. (03/01/00)
*Additions underlined, deletions bracketed from May 2001 forward.
3214.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Soybean Oil futures option at a
premium of more than the trading limit for the Soybean Oil futures contract
above and below the previous day's settlement premium for that option as
determined by the Clearing Corporation. On the first day of trading, limits
shall be set from the lowest premium of the opening range. (10/01/94)
================================================================================
Chapter 33
Soybean Meal Futures Options
================================================================================
Ch33 Trading Conditions......................................
3301.00 Authority......................................
3301.01 Application of Regulations.....................
3302.01 Nature of Soybean Meal Futures Put Options.....
3302.02 Nature of Soybean Meal Futures Call Options....
3303.01 Trading Unit...................................
3304.01 Striking Prices................................
3305.01 Payment of Option Premium......................
3306.01 Option Premium Basis...........................
3307.01 Exercise of Option.............................
3307.02 Automatic Exercise.............................
3308.01 Expiration of Option...........................
3309.01 Months Traded..................................
3310.01 Trading Hours..................................
3311.01 Position Limits and Reportable Positions.......
3312.01 Margin Requirements............................
3313.01 Last Day of Trading............................
3314.01 Option Premium Fluctuation Limits..............
================================================================================
Chapter 33
Soybean Meal Futures Options
================================================================================
Ch33 Trading Conditions
3301.00 Authority - (See Rule 2801.00). (10/01/94)
3301.01 Application of Regulations - Transactions in put and call options on
Soybean Meal futures contracts shall be subject to the general rules of the
Association as far as applicable and shall also be subject to the regulations
contained in this chapter which are exclusively applicable to trading in put and
call options on Soybean Meal futures contracts. (See Rule 490.00). (10/01/94)
3302.01 Nature of Soybean Meal Futures Put Options - The buyer of one (1)
Soybean Meal futures put option may exercise his option at any time prior to
expiration, (subject to Regulation 3307.01), to assume a short position in one
(1) Soybean Meal futures contract of a specified contract month at a striking
price set at the time the option was purchased. The seller of one (1) Soybean
Meal futures put option incurs the obligation of assuming a long position in one
(1) Soybean Meal futures contract of a specified contract month at a striking
price set at the time the option was sold, upon exercise by a put option buyer.
(10/01/94)
3302.02 Nature of Soybean Meal Futures Call Options - The buyer of one (1)
Soybean Meal futures call option may exercise his option at any time prior to
expiration, (subject to Regulation 3307.01), to assume a long position in one
(1) Soybean Meal futures contract of a specified contract month at a striking
price set at the time the option was purchased. The seller of one (1) Soybean
Meal futures call option incurs the obligation of assuming a short position in
one (1) Soybean Meal futures contract of a specified contract month at a
striking price set at the time the option was sold, upon exercise by a call
option buyer. (10/01/94)
3303.01 Trading Unit - One (1)100 ton Soybean Meal futures contract of a
specified contract month on the Chicago Board of Trade. (10/01/94)
3304.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of five (5) dollars
per ton per Soybean Meal futures contract (i.e., 185, 190, 195, etc.) for all
strikes less than two hundred dollars and in integral multiples of ten (10)
dollars per ton per Soybean Meal futures contract (i.e., 200, 210, 220, etc.)
for all strikes greater than or equal to two hundred dollars (the "first tier");
and in integral multiples of ten (10) dollars per ton per Soybean Meal futures
contract (i.e., 200, 210, 220, etc.) for all strikes less than two hundred
dollars and in integral multiples of twenty (20) dollars per ton per Soybean
Meal futures contract (i.e., 200, 220, 240, etc.) for all strikes greater than
or equal to two hundred dollars (the "second tier") as follows:
1. a. Per the first tier, at the commencement of trading for an option
contract, the following strikes shall be listed: one with a strike
closest to the previous day's settlement price of the underlying
Soybean Meal futures contract, the next ten consecutive higher strikes
and the next ten consecutive lower strikes (the "initial band"). If the
previous day's settlement price is midway between two strikes, the
closest price shall be the larger of the two.
b. Per the second tier, at the commencement of trading for an option
contract, the following strikes shall be listed: the next four
consecutive strikes above the initial band.
Ch33 Trading Conditions
-----------------------
c. Per the first tier, over time, strikes shall be added as necessary to
insure that at least ten strikes above and below the previous day's
trading range of the underlying futures are listed (the "minimum
band").
d. Per the second tier, over time, strikes shall be added as necessary to
insure that the next four consecutive strikes above the minimum band
are listed.
e. No new strikes may be added by these procedures in the month in which
an option expires.
2. a. Per the second tier, all strikes in which the previous day's delta
factors (as determined by the Board of Trade) for both the put and call
options are 0.10 or greater for two consecutive business days will be
listed for trading. However, no new strikes may be added by this
procedure to an option month unless open positions exist in that
contract month.
b. Per the first tier, during the month in which an option expires, all
strikes in which the previous day's delta factors (as determined by the
Board of Trade) for both the put and call options are 0.10 or greater
for two consecutive business days will be listed for trading.
3. All strikes will be listed prior to the opening of trading on the following
business day. The Exchange may modify the procedures for the introduction of
strikes as it deems appropriate in order to respond to market conditions.
(03/01/99)
3305.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
3306.01 Option Premium Basis - The premium for Soybean Meal futures options
shall be in multiples of five (5) cents per ton of a 100 ton Soybean Meal
futures contract which shall equal $5.00 per contract.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $4.00 in $1.00 increments per option contract.
(10/01/94)
3307.01 Exercise of Option - The buyer of a Soybean Meal futures option may
exercise the option on any business day prior to expiration by giving notice of
exercise to the Clearing Corporation by 6:00 p.m., or at such other time
designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. on the
expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. on the last day of trading.
(12/01/99)
3307.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3307.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or at such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
3308.01 Expiration of Option - Unexercised Soybean Meal futures options shall
expire at 10:00 a.m. on the first Saturday following the last day of trading.
(10/01/94)
3309.01 Months Traded - Trading may be conducted in the nearby Soybean Meal
futures options contract month plus any succeeding months, provided however,
that the Exchange may determine not to list a contract month. For options that
are traded in months in which Soybean Meal futures are not traded, the
underlying futures contract is the next futures contract that is nearest to the
expiration of the option. For example, the underlying futures contract for the
February option contract is the March futures contract. (09/01/00)
3310.01 Trading Hours - The hours of trading of options on Soybean Meal futures
contracts shall be determined by the Board. On the last day of trading in an
expiring option, the closing time for such options shall be the same as the
close of trading of the Regular Daytime open outcry trading session for the
corresponding Soybean Meal futures contract, subject to the provisions of the
second paragraph of Rule 1007.00. On the last day of trading in an expiring
option, the expiring Soybean Meal futures options shall be closed with a public
call made striking price by striking price, conducted by such persons as the
Regulatory Compliance Committee shall direct. On all other days, Soybean Meal
futures options shall be opened and closed for all months and striking prices
simultaneously or in such a manner as the Regulatory Compliance Committee shall
direct. (03/01/00)
3311.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
3312.01 Margin Requirements - (See Regulation 431.03) (10/01/94)
*3313.01 Last Day of Trading - No trades in Soybean Meal futures options
expiring in the current month shall be made after the close of trading of the
Regular Daytime open outcry trading session for the corresponding Soybean Meal
futures contract on the last Friday which precedes by at least two [five]
business days, the last business day of the month preceding the option month. If
such Friday is not a business day, the last day of trading shall be the business
day prior to such Friday. (03/01/00)
* Additions underlined, deletions bracketed for contracts from May 2001 forward.
3314.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Soybean Meal futures option at a
premium of more than the trading limit for the Soybean Meal futures contract
above and below the previous day's settlement premium for that option as
determined by the Clearing Corporation. On the first day of trading, limits
shall be set from the lowest premium of the opening range. (10/01/94)
[Download Table]
================================================================================
Chapter 35A (Standard Options)
Medium Term U.S. Treasury Note Futures Options
================================================================================
Ch35A Trading Conditions....................................................
A3501.00 Authority......................................................
A3501.01 Application of Regulations.....................................
A3502.01 Nature of Medium Term U.S. Treasury Note Futures Put Options...
A3502.02 Nature of Medium Term U.S. Treasury Note Futures Call Options..
A3503.01 Trading Unit...................................................
A3504.01 Striking Prices................................................
A3505.01 Payment of Option Premium......................................
A3506.01 Option Premium Basis...........................................
A3507.01 Exercise of Option.............................................
A3507.02 Automatic Exercise.............................................
A3508.01 Expiration of Option...........................................
A3509.01 Months Traded In...............................................
A3510.01 Trading Hours..................................................
A3511.01 Position Limits and Reportable Positions.......................
A3512.01 Margin Requirements............................................
A3513.01 Last Day of Trading............................................
A3514.01 Option Premium Fluctuation Limits..............................
================================================================================
Chapter 35A (Standard Options)
Medium Term U.S. Treasury Note Futures Options
================================================================================
Ch35A Trading Conditions
A3501.00 Authority - (See Rule 2801.00.) (10/01/94)
A3501.01 Application of Regulations - Transactions in put and call options on
Medium Term U.S. Treasury Note futures contracts shall be subject to the general
rules of the Association as far as applicable and shall also be subject to the
regulations contained in this Chapter which are exclusively applicable to
trading in put and call options on Medium Term U.S. Treasury Note futures
contracts. (See Rule 490.00.) (09/01/00)
A3502.01 Nature of Medium Term U.S. Treasury Note Futures Put Options - The
buyer of one (1) Medium Term U.S. Treasury Note futures put option may exercise
his option at any time prior to expiration (subject to Regulation 3507.01), to
assume a short position in one (1) Medium Term U.S. Treasury Note futures
contract of a specified contract month at a striking price set at the time the
option was purchased. The seller of one (1) Medium Term U.S. Treasury Note
futures put option incurs the obligation of assuming a long position in one (1)
Medium Term U.S. Treasury Note futures contract of a specified contract month at
a striking price set at the time the option was sold, upon exercise by a put
option buyer. (10/01/94)
A3502.02 Nature of Medium Term U.S. Treasury Note Futures Call Options - The
buyer of one (1) Medium Term U.S. Treasury Note futures call option may exercise
his option at any time prior to expiration (subject to Regulation 3507.01), to
assume a long position in one (1) Medium Term U.S. Treasury Note futures
contract of a specified contract month at a striking price set at the time the
option was purchased. The seller of one (1) Medium Term U.S. Treasury Note
futures call option incurs the obligation of assuming a short position in one
(1) Medium Term U.S. Treasury Note futures call option incurs the obligation of
assuming a short position in one (1) Medium Term U.S. Treasury Note futures
contract of a specified contract month at a striking price set at the time the
option was sold, upon exercise by a call option buyer. (10/01/94)
A3503.01 Trading Unit - One (1) Medium Term U.S. Treasury Note futures contract
of a specified contract month on the Chicago Board of Trade. (10/01/94)
A3504.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one-half (1/2) point per Medium
Term U.S. Treasury Note futures contract. At the commencement of trading for
such option contracts, the following strike prices shall be listed: one with a
striking price closest to the previous day's settlement price on the underlying
Medium Term U.S. Treasury Note futures contract, the next twelve consecutive
higher and the next twelve consecutive lower striking prices closest to the
previous day's settlement price; and all strike prices listed for all other
option contract months listed at that time. If the previous day's settlement
price is midway between two striking prices, the closest price shall be the
larger of the two. When a sale in the underlying Medium Term U.S. Treasury Note
futures contract occurs at a price greater than or equal to the twelfth largest
striking price, a new striking price one increment higher than the existing
striking prices will be added. When a sale in the underlying Medium Term U.S.
Treasury Note futures contract occurs at a price less than or equal to the
twelfth smallest striking price, a new striking price one increment lower than
the existing striking prices will be added. When a new strike price is added for
an option contract month, the same strike price will be added to all options
contract months for which that strike price is not already listed. All new
strike prices will be added prior to the opening of trading on the following
business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (10/01/94)
A3505.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
Ch35A Trading Conditions
------------------------
A3506.01 Option Premium Basis - The premium for Medium Term U.S. Treasury Note
futures options shall be in multiples of one sixty-fourth (1/64) of one point
($1,000) of a Medium Term U. S. Treasury Note futures contract which shall equal
$15.63 per 1/64 and $1,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract
If options are quoted in volatility terms, the minimum price fluctuation shall
be .10 percent (i.e.-10.0%, 10.1%, 10.2%, etc.) (10/01/94)
A3507.01 Exercise of Option - The buyer of a Medium Term U.S. Treasury Note
futures option may exercise the option on any business day prior to expiration
by giving notice of exercise to the Clearing Corporation by 6:00 p.m., or by
such other time designated by the Board of Directors, on such day.
Notwithstanding the foregoing, the buyer may exercise the option prior to 10:00
a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
A3507.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3507.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
A3508.01 Expiration of Option - Unexercised Medium Term U.S. Treasury Note
futures options shall expire at 10:00 a.m. on the first Saturday following the
last day of trading. (10/01/94)
A3509.01 Months Traded In - Trading may be conducted in Medium Term U.S.
Treasury Note futures options for a thirty-six month period extending from the
nearby contract month, provided however, that the Exchange may determine not to
list a contract month. Both serial and quarterly options may be listed to expire
into either front-month or deferred futures as determined by the Board.
(06/01/99)
A3510.01 Trading Hours - The hours of trading of options on Medium Term U.S.
Treasury Note futures contracts shall be determined by the Board. On the last
day of trading in an expiring option, the closing time for such options shall be
the same as the close of trading of the Regular Daytime open outcry trading
session for the corresponding Medium Term U.S. Treasury Note futures contract,
subject to the provisions of the second paragraph of Rule 1007.00. Medium Term
U.S. Treasury Note futures options shall be opened and closed for all months and
strike prices simultaneously or in such a manner as the Regulatory Compliance
Committee shall direct. (04/01/00)
A3511.01 Position Limits and Reportable Positions - (See Regulation 425.01.)
(10/01/00)
A3512.01 Margin Requirements - (See Regulation 431.05.) (10/01/94)
*A3513.01 Last Day of Trading - No trades in Medium Term U.S. Treasury Note
futures put and call options expiring in the current month shall be made after
the close of trading of the Regular Daytime open outcry trading session for the
corresponding U.S. Treasury Bond futures contract on the last Friday which
precedes by at least two [five] business days, the last business day of the
month
Ch35A Trading Conditions
------------------------
preceding the option month. If such Friday is not a business day, or there is a
Friday which is not a business day which precedes by one [four] business day[s]
the last business day of the month preceding the option month, the last day of
trading will be the business day prior to such Friday. (03/01/00)
*Additions underlined, deletions bracketed for contracts from June 2001 forward.
A3514.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Medium Term U.S. Treasury Note
futures option at a premium of more than the trading limit for the Medium Term
U.S. Treasury Note futures contract above and below the previous day's
settlement premium for that option as determined by the Clearing Corporation. On
the first day of trading, limits shall be set from the lowest premium of the
opening range. (10/01/94)
================================================================================
Chapter 35B (Flexible Options)
Medium Term Treasury Note Flexible Options
================================================================================
Ch35B Trading Conditions.........................................
B3502.03 Nature of Flexible Options........................
B3503.01 Trading Unit......................................
B3504.01 Strike Prices.....................................
B3507.01 Exercise of Flexible Options......................
B3507.02 Automatic Exercise................................
B3508.01 Expiration Date...................................
B3509.01 Months Traded In..................................
B3513.01 Last Day of Trading...............................
B3516.01 Underlying Futures Contract for Flexible Options..
B3517.01 Initiating a Flexible Option Contract Series......
B3519.01 RFQ Trading Interval..............................
B3520.01 Expiration of an RFQ..............................
B3521.01 Reporting of Flexible Option Trades...............
================================================================================
Chapter 35B (Flexible Options)
Medium Term Treasury Note Flexible Options
================================================================================
Note: The following Flexible option regulations with the exception noted in
the second paragraph of Regulation 3502.03 supersede the
corresponding standard regulations presented in Part A of this
chapter. Regulations 3501.00, 3501.01, 3502.01, 3502.02, 3501.01,
3506.01, 3510.01, 3511.01, 3512.01, and 3514.01 remain in effect for
both standard and Flexible options.
Ch35B Trading Conditions
B3502.03 Nature of Flexible Options - Flexible options on Medium Term Treasury
Note futures shall be permitted in puts and calls which do not have the same
underlying futures contract, same strike price, same exercise style, and same
last day of trading as standard options.
However, Flexible Options on Medium Term Treasury Note futures shall also be
permitted in puts and calls which have the same underlying futures contract,
same strike price, same exercise style, and same last day of trading as standard
options that are not at the time listed for trading in the standard options pit
or on e-cbot. All Flexible Option regulations except 3507.01, 3507.02, 3508.01
and 3513.01 will pertain for these options.*
Trading shall be permitted in any CBOT recognized option/option or
option/futures spread involving puts, calls or futures. (09/01/00)
B3503.01 Trading Unit - The minimum size for requesting a quote and/or trading
in a flexible option series is 50 contracts, where each contract represents one
of the underlying futures contracts at the Chicago Board of Trade. Parties may
request a quote and/or trade for less than 50 contracts in order to entirely
close out a position in a flexible series.
For a flexible options series, respondents to a request for quote, must be
willing to trade at least 50 contracts, with the exception that a respondent may
trade less than 50 contracts if the respondent is entirely closing out a
position in the series. (07/01/99)
B3504.01 Strike Prices - Strike prices for flexible options must be specified
in points and 64th's of points per Medium Term Treasury Note futures contract.
However, for a Request for Quote (RFQ), strike prices may be specified in one
64th point increments relative to the underlying futures contract. Strike prices
cannot be outside the range of the currently listed strike prices for standard
options. (06/01/95)
B3507.01 Exercise of Flexible Options - Notification of the intent to exercise
a flexible option must be received by the Clearing Corporation by 4:10 p.m.
Chicago time, or by such other time designated by the Board of Directors. No
exceptions to the 4:10 p.m. exercise deadline, or such other deadline designated
by the Board of Directors, shall be permitted.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3502.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
B3507.02 Automatic Exercise - After the close on the last day of trading, all
in-the-money flexible options will be automatically exercised unless notice to
cancel automatic exercise is given to the Clearing Corporation by 4:10 p.m., or
by such other time designated by the Board of Directors, on that day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3502.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
*B3508.01 Expiration Date - Flexible option expiration may be specified for any
Monday through Friday that is not an Exchange holiday except that expiration may
not occur following the last Friday that precedes by at least [five] two
business days the last business day of the calendar month
Ch35B Trading Conditions
------------------------
preceding the underlying future contract month. Flexible options expire at 4:30
p.m. on the last trading day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3502.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (04/01/00)
*Addition underlined; deletion bracketed for contracts from June 2001 forward.
B3509.01 Months Traded In - Trading may be conducted in flexible options in any
month through the most distant underlying futures contract in which a trade has
occurred. (10/01/94)
B3513.01 Last Day of Trading - The last day of trading in a flexible option
shall be the expiration day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3502.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (05/01/94)
B3515.01 Exercise Style - Flexible options may be American or European exercise
style. (10/01/94)
B3516.01 Underlying Futures Contract for Flexible Options - The underlying
futures contract for a flexible option shall be the same as the underlying
futures contract month of the nearest March quarterly cycle standard futures
option expiring on or after the expiration of the flexible option. (10/01/94)
B3517.01 Initiating a Flexible Option Contract Series - For each trading
session, the opening of trading in any flexible option series shall occur
through the submission of an RFQ.
If so desired, participants can submit additional RFQ's for any open series
during a trading day. However, in this situation no priority period (Regulation
3519.01) will exist. (09/01/98)
B3519.01 RFQ Trading Interval - If the submitter of the first RFQ of the day in
a flexible series requests either a bid or an offer but not both, then they
shall have up to a two minute priority period during which they shall have the
sole right to either buy or sell as specified in their RFQ. The exact length of
the priority period shall be determined by the Exchange.
If more than one RFQ is the first RFQ of the day in a flexible series, all the
RFQ's individually ask for either a bid or an offer but not both, and all the
RFQ's collectively are for the same side of the market (all bids or all offers)
then the submitters shall jointly share priority during the priority period.
A flexible option series shall be immediately open for trading when any of the
following occurs:
(1) The priority period expires;
(2) Two or more RFQ's are jointly the first of the day and the RFQ's
contain requests for both sides of the market, or the RFQ's contain
requests for different sides of the market; or
(3) The first RFQ of the day requests both sides of the market.
Priority for RFQ's is determined by submission to the RFQ official, except that
all RFQ's submitted before the open shall be treated equally. (03/01/98)
B3520.01 Expiration of an RFQ - Trading in a given flexible option series
following an RFQ shall remain open for the remainder of the trading session.
(10/01/94)
B3521.01 Reporting of Flexible Option Trades - It shall be the responsibility
of the participants in a flexible option trade to report the quantities and
prices to the flexible pit reporter in a timely manner, including any later
trades in open flexible contract term series. (10/01/94)
* The effect of the second paragraph of Regulation 3502.03 is to permit
trading in standard option under certain Flexible trading procedures prior
to the listing of such options in the standard options pit or on e-cbot.
Once and if these options are listed for trading in the standard options pit
or on e-cbot, they will be traded only in the standard options pit or on e-
cbot, they will be traded only in the standard options pit or e-cbot subject
to standard options trading requirements. Upon such listing, all existing
open positions established under Flexible trading procedures shall be fully
fungible with transactions in the respective standard option series for all
purposes under these regulations.
[Download Table]
================================================================================
Chapter 36A (Standard Options)
Short Term U.S. Treasury Note Futures Options
================================================================================
Ch36A Trading Conditions.....................................................
A3601.00 Authority.......................................................
A3601.01 Application of Regulations......................................
A3602.01 Nature of Short Term U.S. Treasury Note Futures Put Options.....
A3602.02 Nature of Short Term U.S. Treasury Note Futures Call Options....
A3603.01 Trading Unit....................................................
A3604.01 Striking Prices.................................................
A3605.01 Payment of Option Premium.......................................
A3606.01 Option Premium Basis............................................
A3607.01 Exercise of Option..............................................
A3607.02 Automatic Exercise..............................................
A3608.01 Expiration of Option............................................
A3609.01 Months Traded In................................................
A3610.01 Trading Hours...................................................
A3611.01 Position Limits and Reportable Positions........................
A3612.01 Margin Requirements.............................................
A3613.01 Last Day of Trading.............................................
A3614.01 Option Premium Fluctuation Limits...............................
================================================================================
Chapter 36A (Standard Options)
Short Term U.S. Treasury Note Futures Options
================================================================================
Ch36A Trading Conditions
A3601.00 Authority - (See Rule 2801.00.) (10/01/94)
A3601.01 Application of Regulations - Transactions in put and call options on
Short Term U.S. Treasury Note futures contracts shall be subject to the general
rules of the Association as far as applicable and shall also be subject to the
regulations contained in this chapter which are exclusively applicable to
trading in put and call options on Short Term U.S. Treasury Note futures
contracts. (See Rule 490.00.) (09/01/00)
A3602.01 Nature of Short Term U.S. Treasury Note Futures Put Options - The
buyer of one (1) Short Term U.S. Treasury Note futures put option may exercise
his option at any time prior to expiration (subject to Regulation 3607.01), to
assume a short position in one (1) Short Term U.S. Treasury Note futures
contract of a specified contract month at a striking price set at the time the
option was purchased. The seller of one (1) Short Term U.S. Treasury Note
futures put option incurs the obligation of assuming a long position in one (1)
Short Term U.S. Treasury Note futures contract of a specified contract month at
a striking price set at the time the option was sold, upon exercise by a put
option buyer. (10/01/94)
A3602.02 Nature of Short Term U.S. Treasury Note Futures Call Options - The
buyer of one (1) Short Term U.S. Treasury Note futures call option may exercise
his option at any time prior to expiration (subject to Regulation 3607.01), to
assume a long position in one (1) Short Term U.S. Treasury Note futures contract
of a specified contract month at a striking price set at the time the option was
purchased. The seller of one (1) Short Term U.S. Treasury Note futures call
option incurs the obligation of assuming a short position in one (1) Short Term
U.S. Treasury Note futures contract of a specified contract month at a striking
price set at the time the option was sold, upon exercise by a call option buyer.
(10/01/94)
A3603.01 Trading Unit - One (1) $200,000 face value Short Term U.S. Treasury
Note futures contract at a specified contract month on the Chicago Board of
Trade. (10/01/94)
A3604.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one-quarter (1/4) point per Short
Term U.S. Treasury Note futures contract. At the commencement of trading for
such option contracts, the following strike prices shall be listed: one with a
striking price closest to the previous day's settlement price on the underlying
Short Term U.S. Treasury Note futures contract, the next six consecutive higher
and the next six consecutive lower striking prices closest to the previous day's
settlement price; and all strike prices listed for all other option contract
months listed at that time. If the previous day's settlement price is midway
between two striking prices, the closest price shall be the larger of the two.
When a sale in the underlying Short Term U.S. Treasury Note futures contract
occurs at a price greater than or equal to the sixth largest striking price, a
new striking price one increment higher than the existing striking prices will
be added. When a sale in the underlying Short Term U.S. Treasury Note futures
contract occurs at a price less than or equal to the sixth smallest striking
price, a new striking price one increment lower than the existing striking
prices will be added. When a new strike price is added for an option contract
month, the same strike price will be added to all option contract months for
which that strike price is not already listed. All new strike prices will be
added prior to the opening of trading on the following business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (10/01/94)
A3605.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (10/01/94)
Ch36A Trading Conditions
-----------------------
A3606.01 Option Premium Basis - The premium for Short Term U.S. Treasury Note
futures options shall be in multiples of one half of one sixty-fourth (1/64) of
one point ($15.63) of a Short Term U.S. Treasury Note futures contract which
shall equal $2,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract.
If options are quoted in volatility terms, the minimum price fluctuation shall
be .10 percent (i.e.-10.0%, 10.1%, 10.2%, etc.) (10/01/94)
A3607.01 Exercise of Option - The buyer of a Short Term U.S. Treasury Note
futures option may exercise the option on any business day prior to expiration
by giving notice of exercise to the Clearing Corporation by 6:00 p.m., or by
such other time designated by the Board of Directors, on such day.
Notwithstanding the foregoing, the buyer may exercise the option prior to 10:00
a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
A3607.02 Automatic Exercise - Notwithstanding the provisions of Regulation
3607.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m., or by such other time designated by the Board of Directors, on the
last day of trading, except that such notice may be given to the Clearing
Corporation prior to 10:00 a.m. on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions;
iii) in exceptional cases involving a customer's inability to communicate to the
member firm exercise instructions or the member firm's inability to receive
such instructions prior to 6:00 p.m. on the last day of trading. (12/01/99)
A3608.01 Expiration of Option - Unexercised Short Term U.S. Treasury Note
futures options shall expire at 10:00 a.m. on the first Saturday following the
last day of trading. (10/01/94)
A3609.01 Months Traded In - Trading may be conducted in Short Term U.S.
Treasury Note futures options for a forty-two month period extending from the
nearby contract month, provided however, that the Exchange may determine not to
list a contract month. Both serial and quarterly options may be listed to expire
into either front-month or deferred futures as determined by the Board.
(06/01/99)
A3610.01 Trading Hours - The hours of trading of options on Short Term U.S.
Treasury Note futures contracts shall be determined by the Board. On the last
day of trading in an expiring option, the closing time for such options shall be
the same as the close of trading of the Regular Daytime open outcry trading
session for the corresponding Short Term U.S. Treasury Note futures contract,
subject to the provisions of the second paragraph of Rule 1007.00. Short Term
U.S. Treasury Note futures options shall be opened and closed for all months and
strike prices simultaneously or in such a manner as the Regulatory Compliance
Committee shall direct. (04/01/00)
A3611.01 Position Limits and Reportable Positions - (See Regulation 425.01.)
(10/01/00)
A3612.01 Margin Requirements - (See Regulation 431.05) (10/01/94)
*A3613.01 Last Day of Trading - No trades in Short Term U.S. Treasury Note
futures put and call options expiring in the current month shall be made after
the close of trading of the Regular Daytime open outcry trading session for the
corresponding Short Term U.S. Treasury Note futures contract on the last Friday
which precedes by at least two [five] business days, the last business day of
---
the month preceding the option month. If such Friday is not a business day, or
there is a Friday which is not a
Ch36A Trading Conditions
------------------------
business day which precedes by one [four] business day[s] the last business day
of the month preceding the option month, the last day of trading shall be the
first business day prior to such Friday. (03/01/00)
*Additions underlined, deletions bracketed for contracts from June 2001 forward.
A3614.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Short Term U.S. Treasury Note
futures option at a premium of more than the trading limit for the Short Term
U.S. Treasury Note futures contract above and below the previous day's
settlement premium for that option as determined by the Clearing Corporation. On
the first day of trading, limits shall be set from the lowest premium of the
opening range. (10/01/94)
================================================================================
Chapter 36B (Flexible Options)
Short Term Treasury Note Flexible Options
================================================================================
Ch36B Trading Conditions.......................................
B3602.03 Nature of Flexible Options........................
B3603.01 Trading Unit......................................
B3604.01 Strike Prices.....................................
B3607.01 Exercise of Flexible Options......................
B3607.02 Automatic Exercise................................
B3608.01 Expiration Date...................................
B3609.01 Months Traded In..................................
B3613.01 Last Day of Trading...............................
B3615.01 Exercise Style....................................
B3616.01 Underlying Futures Contract for Flexible Options..
B3617.01 Initiating a Flexible Option Contract Series......
B3619.01 RFQ Trading Interval..............................
B3620.01 Expiration of an RFQ..............................
B3621.01 Reporting of Flexible Option Trades...............
================================================================================
Chapter 36B (Flexible Options)
Short Term Treasury Note Flexible Options
================================================================================
Note: The following Flexible option regulations with the exception noted
in the second paragraph of Regulation 3602.03 supersede the
corresponding standard regulations presented in Part A of this
chapter. Regulations 3601.00, 3601.01, 3602.01, 3602.02, 3605.01,
3606.01, 3610.01, 3611.01, 3612.01, and 3614.01 remain in effect for
both standard and Flexible options.
Ch36B Trading Conditions
B3602.03 Nature of Flexible Options - Flexible options on Short Term Treasury
Note futures shall be permitted in puts and calls which do not have the same
underlying futures contract, same strike price, same exercise style, and same
last day of trading as standard options.
However, Flexible Options on Short Term Treasury Note futures shall also be
permitted in puts and calls which have the same underlying futures contract,
same strike price, same exercise style, and same last day of trading as standard
options that are not at the time listed for trading in the standard options pit
or on e-cbot. All Flexible Option regulations except 3607.01, 3607.02, 3608.01
and 3613.01 will pertain for these options.*
Trading shall be permitted in any CBOT recognized option/option or
option/futures spread involving puts, calls or futures. (09/01/00)
B3603.01 Trading Unit - The minimum size for requesting a quote and/or trading
in a flexible option series is 50 contracts, where each contract represents one
of the underlying futures contracts at the Chicago Board of Trade. Parties may
request a quote and/or trade for less than 50 contracts in order to entirely
close out a position in a flexible series.
For a flexible options series, respondents to a request for quote, must be
willing to trade at least 50 contracts, with the exception that a respondent may
trade less than 50 contracts if the respondent is entirely closing out a
position in the series. (07/01/99)
B3604.01 Strike Prices - Strike prices for flexible options must be specified
in points and 64th's of points per Short Term Treasury Note futures contract.
However, for a Request for Quote (RFQ), strike prices may be specified in one
64th point increments relative to the underlying futures contract. Strike prices
cannot be outside the range of the currently listed strike prices for standard
options. (06/01/95)
B3607.01 Exercise of Flexible Options - Notification of the intent to exercise
a flexible option must be received by the Clearing Corporation by 4:10 p.m.
Chicago time, or by such other time designated by the Board of Directors. No
exceptions to the 4:10 p.m. exercise deadline, or such other deadline designated
by the Board of Directors, shall be permitted.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3602.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (12/01/99)
B3607.02 Automatic Exercise - After the close on the last day of trading, all
in-the-money flexible options will be automatically exercised unless notice to
cancel automatic exercise is given to the Clearing Corporation by 4:10 p.m., or
by such other time designated by the Board of Directors, on that day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3602.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (`12/01/99)
*B3608.01 Expiration Date - Flexible option expiration may be specified for any
Monday through Friday that is not an Exchange holiday except that expiration may
not occur following the last Friday that precedes by at least [five] two
business days the last business day of the calendar month preceding the
underlying future contract month. Flexible options expire at 4:30 p.m. on the
last trading
Ch36B Trading Conditions
------------------------
day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3602.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (04/01/00)
*Addition underlined; deletion bracketed for contracts from June 2001 forward.
B3609.01 Months Traded In - Trading may be conducted in flexible options in any
month up through the most distant underlying futures contract in which a trade
has occurred. (10/01/94)
B3613.01 Last Day of Trading - The last day of trading in a flexible option
shall be the expiration day.
However, options which meet the criteria given in the second paragraph of
Flexible Option Regulation 3602.03 will follow expiration and exercise
procedures as specified in the standard option regulations. (05/01/94)
B3615.01 Exercise Style - Flexible options may be American or European exercise
style. (10/01/94)
B3616.01 Underlying Futures Contract for Flexible Options - The underlying
futures contract for a flexible option shall be the same as the underlying
futures contract month of the nearest March quarterly cycle standard futures
option expiring on or after the expiration of the flexible option. (10/01/94)
B3617.01 Initiating a Flexible Option Contract Series - For each trading
session, the opening of trading in any flexible option series shall occur
through the submission of an RFQ.
If so desired, participants can submit additional RFQ's for any open series
during a trading day. However, in this situation no priority period (Regulation
3619.01) 1will exist. (09/01/98)
B3619.01 RFQ Trading Interval - If the submitter of the first RFQ of the day in
a flexible series requests either a bid or an offer but not both, then they
shall have up to a two minute priority period during which they shall have the
sole right to either buy or sell as specified in their RFQ. The exact length of
the priority period shall be determined by the Exchange.
If more than one RFQ is the first RFQ of the day in a flexible series, all the
RFQ's individually ask for either a bid or an offer but not both, and all the
RFQ's collectively are for the same side of the market (all bids or all offers)
then the submitters shall jointly share priority during the priority period.
A flexible option series shall be immediately open for trading when any of the
following occurs:
(1) The priority period expires;
(2) Two or more RFQ's are jointly the first of the day and the RFQ's
contain requests for both sides of the market, or the RFQ's contain
requests for different sides of the market; or
(3) The first RFQ of the day requests both sides of the market.
Priority for RFQ's is determined by submission to the RFQ official, except that
all RFQ's submitted before the open shall be treated equally. (03/01/98)
B3620.01 Expiration of an RFQ - Trading in a given flexible option series
following an RFQ shall remain open for the remainder of the trading session.
(10/01/94)
B3621.01 Reporting of Flexible Option Trades - It shall be the responsibility
of the participants in a flexible option trade to report the quantities and
prices to the flexible pit reporter in a timely manner, including any later
trades in open flexible contract term series. (10/01/94)
* The effect of the second paragraph of Regulation 3602.03 is to permit
trading in standard options under certain Flexible trading procedures prior
to the listing of such options in the standard options pit or on e-cbot.
Once and if these options are listed for trading in the standard options
pit or on e-cbot, they will be traded only in the standard options pit or
on e-cbot subject to standard options trading requirements. Upon such
listing, all existing open positions established under Flexible trading
procedures shall be fully fungible with transactions in the respective
standard option series for all purposes under these regulations.
for all purposes under these regulations.
3608B
[Download Table]
================================================================================
Chapter 37
CBOT Rough Rice Futures
================================================================================
Ch37 Trading Conditions...................................................
3700.01 Introduction...............................................
3701.01 Contract Specifications....................................
3701.02 Trading Months and Hours...................................
3701.03 Trading Unit...............................................
3701.04 Price Increments...........................................
3701.05 Daily Price Limits.........................................
3701.06 Termination of Trading.....................................
3701.07 Contract Modifications.....................................
3701.08 Position Limits and Trading Limits.........................
3702.01 Delivery by Warehouse Receipts.............................
3702.02 Registration of Warehouse Receipts.........................
3702.03 Delivery Dates.............................................
3702.04 Storage....................................................
3702.05 Par Delivery Unit..........................................
3702.06 Par Delivery Point.........................................
3702.07 Delivery Differentials.....................................
3702.08 Delivery and Loading Out...................................
3702.09 Notice of Intention........................................
3703.01 Weighing...................................................
3703.02 Storage Charges............................................
Ch37 Delivery Facilities and Procedures...................................
3704.01 Conditions of Regularity for Warehouses....................
3704.02 Application For Declaration of Regularity..................
3704.03 Duties of Warehousemen.....................................
3704.04 Safeguarding Condition Of Stored Commodities...............
3704.05 Damage To Commodity In Store...............................
3704.06 Revocation of Regularity...................................
3704.07 Federal Warehouses.........................................
3704.08 Finality of USDA Or Other Required Inspection Certificate..
3705.01 Delivery Through Clearing House............................
3705.02 Payment Upon Delivery......................................
3705.03 Necessity Of Possession Of Documents.......................
3705.04 Suspended Member Out Of Line For Delivery..................
3705.05 Failure to Deliver.........................................
3705.06 Failure To Accept Delivery.................................
3705.07 Transfer Of Cash For Futures After Termination Of Contract.
3705.08 Risk Of Loss And Charges...................................
================================================================================
Chapter 37
CBOT Rough Rice Futures
================================================================================
Ch37 Trading Conditions
3700.01 Introduction - This chapter is limited in application to futures
trading in rough rice. The procedures for trading, clearing, inspection,
delivery, settlement and any other matters not specifically covered herein shall
be governed by the Rules and Regulations of the Exchange. (11/01/94)
3701.01 Contract Specifications - All futures contracts shall be for U.S. No.
2 or better long grain rough rice as the same is established by standards
promulgated by the United States Department of Agriculture (U.S.D.A.) at the
time of the first day of trading in a particular contract. No other grade is
deliverable.
To be deliverable, rough rice shall have a milling yield of not less than 65%,
including not less than 48% head rice. Each percent of head rice over or below
55% shall receive a 1.5% premium or discount, respectively, toward the
settlement price for long grain rough rice and each percent of broken rice over
or below 15% shall receive a .75% premium or discount, respectively. All rough
rice shall be of a Southern origin or such other origin as the Exchange may
approve. (11/01/94)
3701.02 Trading Months and Hours - Futures contracts shall be traded initially
for delivery during the months of September, November, January, March, May and
July of each year. The number of months to be open at one time shall be at the
discretion of the Exchange. Trading shall be conducted from 9:15 a.m. to 1:30
p.m. Chicago Time, except in the expiring contract on the last day of trading
when trading shall cease at 12:00 Noon. (11/01/98)
3701.03 Trading Unit - The unit of trading shall be 2,000 hundredweight
(200,000 pounds). (11/01/94)
3701.04 Price Increments - All bids and offers shall be in multiples of $.005
per hundredweight. (11/01/94)
3701.05 Daily Price Limits - (See 1008.01) (11/01/94)
3701.06 Termination of Trading - No trades shall be made during the last seven
business days of the trading month. Any trades remaining open during this period
shall be settled by delivery or a bona fide exchange of futures for the cash
commodity. (11/01/94)
3701.07 Contract Modifications - Contract specifications shall be fixed as of
the first day of trading of the contract and must conform to government grading
standards in force at that time. If any federal governmental agency issues an
order, ruling, directive or law that conflicts with requirements of these
regulations, such order, ruling, directive or law shall be construed to become
part of these regulations, and all new contracts shall be subject to such
governmental orders. (11/01/94)
3701.08 Position Limits and Trading Limits - (See Regulation 425.01)
(11/01/94)
3702.01 Delivery by Warehouse Receipts - Deliveries of rough rice shall be
made only by delivery of rough rice warehouse receipts issued by warehouses
located in the Arkansas counties of Craighead, Jackson, Poinsett, Woodruff,
Cross, St. Francis, Lonoke, Prairie, Monroe, Jefferson, Arkansas and DeSha and
designated by the Exchange as regular. Rough rice warehouse receipts issued by
otherwise regular warehouses licensed under the U.S. Warehouse Act shall be
eligible for delivery in satisfaction of Exchange contracts regardless of
whether such warehouses are or are not also licensed by any state. In order to
effect a valid delivery, each receipt shall (a) be endorsed by holder making
delivery; (b) be marked "INSURED"; (c) indicate payment for storage charges up
to and including the 18th day of the preceding month; (d) be negotiable; (e) be
registered with the registrar of the Exchange; (f) specify the warehouse; and
(g) specify the grade, milling yield and quantity of the rough rice stored.
Unpaid accumulated storage charges shall be allowed and credited to the buyer by
the seller up to and including the date of delivery. No warehouse receipt shall
be valid for delivery if the receipt has expired prior to the delivery or has an
expiration date in the month in which delivered.
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Endorsement by the holder shall constitute a warranty of the genuineness of the
warehouse receipt and of good title thereto, but shall not constitute a
guarantee of performance by the issuer. (11/01/94)
3702.02 Registration of Warehouse Receipts - Registration of rough rice
warehouse receipts shall be subject to the following requirements:
A. Warehouses which are regular for delivery may have their warehouse
receipts registered at any time. Warehouse receipts must not be more
than one year old, and must not have an expiration date in the month
in which they are delivered. The holder of a registered warehouse
receipt may cancel its registration at any time. A warehouse receipt
which has been canceled may not be registered again.
B. The clearing house shall issue a weekly report showing the total
number of warehouse receipts under registration as of 4:00 p.m. on the
last trading day of each week. In addition to the information posted
on the Exchange floor, this weekly report shall show the names of
warehouses whose receipts are registered. (11/01/94)
3702.03 Delivery Dates - For the trading months of January, March, May, July,
September and November, delivery may be made by the seller upon any business day
of the delivery month the seller may select. Delivery must be made no later than
the last business day of the delivery month. (11/01/94)
3702.04 Storage - Rough rice shall be stored in a bin or bins in a warehouse
declared regular by the Exchange, and may contain rough rice from one or more
different lots of the same quality and milling yield. Rough rice may be added to
or withdrawn from such lots, provided any rice added shall be of the same
quality and milling yield and shall conform to the specifications of this
chapter and any withdrawal shall not reduce the amount of rice stored in such
lots to an amount less than the total amount required to satisfy all outstanding
warehouse receipts issued thereagainst. (11/01/94)
3702.05 Par Delivery Unit - Par delivery is 2,000 hundredweight (200,000
pounds) of U.S. No. 2 or better long-grain rough rice. A weight variation of 1%
shall be permitted, such variation to be priced at the previous day's settlement
price if the expiring future is still trading and at the expiration price of the
nearest previous future if no expiring future is trading. (11/01/94)
3702.06 Par Delivery Point - The par delivery points for rough rice shall be
mill site warehouses within the boundaries of the Arkansas counties of
Craighead, Jackson, Poinsett, Woodruff, Cross, St. Francis, Lonoke, Prairie,
Monroe, Jefferson, Arkansas and DeSha. Designation as a mill site warehouse
shall be determined by the Exchange. Rough rice may be delivered in satisfaction
of the rough rice futures contract at rice mill warehouses regular for delivery
at the contract price. Rough rice may be delivered at regular warehouses within
the twelve-county area which are not at mill sites in accordance with a schedule
of discounts established and published by the Exchange pursuant to 3702.07. No
warehouse regular for delivery of rough rice shall be located outside the twelve
Arkansas counties listed above. (11/01/94)
3702.07 Delivery Differentials - Delivery of rough rice in satisfaction of the
rough rice futures contract at regular warehouses other than regular mill site
warehouses shall be subject to a delivery differential of -15 cents per
hundredweight (cwt.) subject to the following:
1. At the time of filing an initial or renewal application for
regularity, a warehouse shall be required to declare whether or not it
is a mill site warehouse as defined in Appendix A.
2. If a regular mill site warehouse (non-mill site warehouse) renews
regularity as a non-mill site warehouse (mill site warehouse) for a
two-year term beginning July 1, the change in the delivery
differential will become effective for the new crop delivery month of
September within that two-year term.
3. Whenever the Exchange receives a bona fide renewal application for
regularity which will cause the warehouse's delivery differential to
change for the next crop year, a notice of the receipt of the
application will be posted on the floor of the Exchange after the
close of the market that day.
4. A warehouse which has been declared regular for delivery as a non-mill
site warehouse (mill site warehouse) for a current regularity term
ending June 30 may not be declared regular for
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delivery as a mill site warehouse (non-mill site warehouse) during the
balance of that term.
Pursuant to the provisions of this regulation, 3702.06 and Appendix A of
these rules and regulation, the Exchange shall publish a list of all
regular warehouses and the applicable discount.
3702.08 Delivery and Loading Out - Delivery shall be made on the basis of the
actual weight of rough rice loaded into rail cars or trucks. A load-out charge
not to exceed the tariff as filed with the Exchange in accordance with 3704.01.H
shall be paid by the buyer to cover loading and weighing. The maximum load-out
charge for the loading-out of rough rice against a rough rice registered
warehouse receipt is 22.222 cents per cwt. which will be subject to an
evaluation by the Exchange at the time of renewal of regularity of rice
warehouses. An increase or decrease in the maximum load-out charge for rough
rice may become effective 30 days after a notice has been posted on the Exchange
floor. The notice will state the amount of the maximum load-out charge, the
applicable warehouse receipts and the date that the charge will become
effective.
Load-outs shall begin not later than the third business day following the day on
which loading instructions are given to the warehouseman; provided, however,
that the withdrawing party has within that period furnished rail cars or trucks
to receive the rice. The warehouseman shall be required to load-out rice at the
normal rate of load-out for the facility, but not less than 20 trucks or its
equivalent weight loaded-out in rail cars per business day and shall be able to
load out the warehouse's entire regular capacity in 45 calendar days or less. A
party taking delivery shall receive the quantity ordered loaded out as soon as
reasonably possible but no more than 45 calendar days after load-out begins.
Rough rice regular warehouses shall not be required to meet these minimum
load-out rates when transportation equipment is not clean and load ready,
inspection services are not available, a condition of force majeure exists, or
inclement weather prevents loading.
In addition, rough rice regular warehouses shall not be required to meet the
minimum load-out rate for rail cars when rail cars have been constructively
placed for load-in prior to constructive placement of rail cars for load-out.
However, when rail cars for load-out are constructively placed after rail cars
for load in, the warehouse will load-in grain from the rail cars at the normal
rate of load-in for the facility. This rate shall not be less than the
equivalent weight of 20 trucks loaded-in from rail cars. Rough rice regular
warehouses shall not be required to meet these minimum load-in rates when a
condition of force majeure exists, inspection services are not available or
inclement weather prevents unloading.
The warehouse operator is not obligated to commence load-out of rough rice to a
given party sooner than three business days after he receives canceled warehouse
receipts and written loading instructions from such party, even if such party
may have a conveyance positioned to accept load-out of rough rice before that
time. If the party taking delivery presents transportation equipment of a
different type (rail or truck) than that specified in the loading instructions,
he is required to provide the warehouse operator with new loading orders, and
the warehouse operator shall not be obligated to begin load-out of rough rice to
such party sooner than three business days after he receives the new loading
orders. Written loading orders received after 2:00 p.m. (Chicago time) on a
given business day shall be deemed to be received on the following business day.
The warehouseman upon receipt of the canceled receipts by his agent and loading
instructions from the owner by 2:00 p.m. on a given day, shall notify the owner
by telex or telefax by 4:00 p.m. on that given day the scheduled day for
load-out. The daily tariff load-out rate and the amount of tonnage which is
scheduled for load-out before owner's load-out shall also be provided in the
notification.
The owner upon acceptance of the scheduled load-out date, and if he so requests
on a given day prior to load-out, shall receive a telex or telefax from the
warehouseman specifying the amount of tonnage remaining before owner's equipment
is loaded.
The warehouseman upon cancellation of loading instructions on any business day
prior to the day of actual loading of rice, and if requested by the owner, shall
reissue and register warehouse receipts for the amount of rough rice which
remains unloaded. Storage fees shall begin on the date of re-issuance of the new
warehouse receipts.
Storage charges on rough rice to be shipped pursuant to loading instructions
shall cease no later than three calendar days following the day on which
canceled warehouse receipts are surrendered or
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loading instructions are given, whichever occurs later; provided, however, that
the owner makes transportation available for loading on the scheduled load-out
date or has not canceled loading instructions.
The warehouse operator shall be permitted a two percent deviation above or below
the yield of head rice shown on the warehouse receipt issued for delivery on the
contract. The warehouse operator shall also be permitted a two percent deviation
above or below the total milling yield shown on the warehouse receipt issued for
delivery on the contract.
The warehouse operator is responsible for maintaining the milling yield of rice
specified on said warehouse receipt, within the stated allowable deviations, for
the total quantity of rice represented by said warehouse receipt and not for
sub-lots (i.e. truckloads) of said warehouse receipt. The warehouse operator is
also responsible for maintaining the numerical grade of rice specified on said
warehouse receipt for the total quantity of rice represented by said warehouse
receipt for the total quantity of rice represented by said warehouse receipt,
however, the numerical grade for sub-lots (i.e., truckloads) shall be no more
than one numerical grade below the deliverable grade specified in 3701.01.
Averaging the grade or milling yield of multiple receipts is not permissible.
When the rough rice is ordered out-of-store, the warehouse operator will be
reimbursed by the buyer in cash if the total milling yield or the yield of head
rice of the rice loaded out is over the total milling yield or the yield of head
rice listed on the warehouse receipt (up to two percent).
Conversely, the warehouse operator will reimburse the buyer in cash if the total
milling yield or the yield of head rice of the rice loaded out is under the
total milling yield or the yield of head rice listed on the warehouse receipt
(up to two percent). Calculations shall be made daily for each receipt loaded
out that day and shall be based on the nearby month rough rice future's
settlement price on the day of load out. Such payments to or from the warehouse
operator for excess or deficit head and broken rice shall be at the premium and
discount schedule specified in 3701.01, Contract Specifications. Adjustments on
the milling yield of head rice shall be based on an official test.
Both the buyer and the warehouseman will provide for an analysis of the rough
rice for grade and milling yield. If there is a disagreement, then a duplicate
sample taken at origin shall be analyzed by the Federal Grain Inspection Service
(FGIS), or a mutually agreed-upon third party to resolve the disagreement.
Notwithstanding the above, the buyer retains the right, at his expense, to an
official sampling and anaylsis by FGIS, or a mutually agreed-upon third party,
at orgin, of rough rice loaded-out at any time. (03/01/97)
3702.09 Notice of Intention - A clearing member intending to deliver shall,
not later than 4:00 p.m. on position day, the second business day prior to the
intended delivery day, provide to the Clearing House, a notice of intention in
the form prescribed by the Exchange. On the last notice day of the delivery
month, however, delivery notices may be delivered to the Clearing House until
2:00 p.m. No intra-office delivery may be made. If a clearing member has both
long and short interest on its books, it must tender to the Clearing House such
notices as it receives from its customers who are short. Prior to the opening of
the market of the following business day, the Clearing House shall pass such
notice to the clearing member having the oldest long contract as of the close of
trading on the day of receipt by the Clearing House of the notice of intent
(position day).
Upon receipt of the names of the buyers obligated to accept delivery from him
and a description of each commodity tendered by him which was assigned by the
Clearing House to each such buyer, the seller shall prepare invoices addressed
to its assigned buyers describing the amount which buyers must pay to the seller
in settlement of the actual deliveries, based on the delivery prices established
by the Clearing House for that purpose adjusted for applicable premiums,
discounts, storage charges, quantity variations and other items for which
provision is made in these rules and regulations and other items for which
provision is made in these rules and regulations relating to contracts. Such
invoices shall be delivered to the Clearing House by 4:00 p.m. on notice day.
Upon receipt of such invoices, the Clearing House shall promptly made them
available to buyers to whom they are addressed. A buyer receiving such an
invoice from the Clearing House shall, not later than 1:00 p.m. of the following
day, present the invoice at the office of the seller by whom it was issued
together with a certified check for the amount due, and thereupon warehouse
receipts shall be delivered by the seller to the buyer.
Ch37 Trading Conditions
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(11/01/94)
3703.01 Weighing - Weighing shall be done in accordance with the current
custom of the trade. The official shipped weight so obtained shall be final
provided, however, that railroad weights shall be acceptable and shall be final
if the negotiable warehouse receipt holder and the seller so agree in writing.
(11/01/94)
3703.02 Storage Charges - Storage charges on rough rice shall not exceed such
charges as have been filed with the Exchange in accordance with 3704.01H. (which
shall be designed to cover costs of storage, insurance and taxes). (11/01/94)
Storage charges on rough rice shall not exceed 34/100 of a cent per
hundredweight per day. (Amended -effective May 1, 1995.)
Ch37 Delivery Facilities and Procedures
3704.01 Conditions of Regularity for Warehouses - The following shall
constitute the requirements and conditions for regularity:
A. The warehouse shall at all times meet standards of construction,
sanitation and dust control, insurability and physical maintenance
applicable generally to commercial warehouses.
B. It shall be situated with respect to transportation facilities deemed
adequate by the Exchange.
C. It shall be located in such states as the Exchange may designate from
time to time as delivery locations for particular commodities.
D. It shall be in good financial standing and credit, and shall meet the
minimum financial requirements and financial reporting requirements
set forth in Appendix D. It shall file a bond with sufficient sureties
in such sum and subject to such conditions as the Exchange may
require. The Exchange may, at its option, waive bond requirements.
E. It shall maintain all licenses required by state or federal law.
F. It shall have standard equipment and appliances for the convenient and
expeditious receiving, handling and shipping of commodities in bulk,
in railroad cars, barges or in trucks, and shall be properly
safeguarded and patrolled.
G. It shall cooperate with the Exchange's system of registration of
negotiable warehouse receipts and furnish to the Registrar all needed
information to enable him to keep a correct record and account of all
commodities remaining in store and receipts issued as of the close of
each week.
H. It shall file its tariffs listing in detail the maximum charges for
the handling and storage of all commodities for which regularity is
sought, and thereafter it shall file with the Exchange any proposed
changes in such tariffs. The effective date of the change will be on
the first day of the month that follows a two-month time period after
the day a written notice of the change is received by the Exchange.
I. Its warehouse receipts rendered in satisfaction of futures contracts
shall not, because of the warehouse's accessibility, tariffs,
insurance rates or other characteristics, adversely affect the value
of the commodity delivered or impair the efficiency of futures trading
in the particular commodity.
J. It shall not engage in unethical conduct, or fail to be operated in
accordance with accepted commercial practices or fail to comply with
governmental statutes, rules and regulations governing warehouses and
the commodities stored therein.
K. It shall make such reports, keep such records, and permit such
warehouse visitations and examinations of documents as the Exchange,
the Commodity Futures Trading Commission pursuant to Commission
Regulation 1.44(a) - (c) and the United States Department of Justice
may prescribe or undertake; it shall comply with all applicable rules,
regulations and orders promulgated by the Commodity Futures Trading
Commission and with all requirements established by the Exchange
because of such rules or orders. (11/01/94)
3704.02 Application For Declaration of Regularity - Persons operating
warehouses for the storage of Rough Rice traded on the Exchange who desire to
have such warehouses made regular for delivery of Rough Rice under the rules and
regulations shall make application for an initial declaration of regularity on a
form prescribed by the Exchange prior to May 1, 1994, and every even year
thereafter, for a two-year term beginning the following July 1, and every even
year thereafter, and at any time during a current term for the balance of that
term. Regular warehouses who desire to change their regular capacity during a
current term shall make application for the desired amount of total regular
capacity on the same form. Initial regularity for the current term and changes
in regularity shall be effective either thirty days after a notice that a bona
fide application has been received, is posted on the floor of the exchange, or
the day after the application is approved by the Exchange, whichever is later.
Applications for a renewal of regularity shall be made prior to May 1, 1994, and
every even year
Ch37 Delivery Facilities and Procedures
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thereafter, for the respective years beginning July 1, 1994 and every even year
thereafter, and shall be on the same form.
As part of its application for regularity, the warehouseman expressly agrees to
consent to the disciplinary jurisdiction of the Exchange for five (5) years
after regularity lapses for conduct pertaining to regularity which occurred
while the warehouse was regular.
3704.03 Duties of Warehousemen - It shall be the duty of operators of all
regular warehouses:
A. RESERVED
B. To notify the Exchange of any change in the condition of their
warehouse which might materially affect their physical or financial
ability to continue to meet the requirements for regularity under
these rules and regulations. Any warehouse must immediately notify the
Exchange of any material reduction of its capital, including the
incurring of a contingent liability which would materially affect
capital should such liability become fixed. Such notice must be in
writing and signed by an officer of the warehouse.
For purposes of this requirement, a reduction amounting to twenty
percent (20%) or more from the total capital reported as of the last
date for which a financial statement was filed under this requirement
shall be deemed material. In determining total capital, there shall be
taken into consideration equities and deficits in all proprietary
accounts properly included in the determination of net worth.
C. To insure adequately and fully commodities covered by warehouse
receipts tendered for delivery against loss by fire, tornado and the
contingencies provided for in the standard form of "extended coverage"
endorsements or policies. Commodities shall be deemed so insured when
the warehouse shall maintain such insurance for the benefit of all
depositories of grain under tariffs, rules or regulations authorized
and promulgated under the authority of the United States Warehouse
Act. In any warehouse declared regular by the Exchange, the charge for
insurance on commodities delivered on futures contracts shall be
limited to a maximum of $1.00 per $100.00 evaluation annually. Any
charges for insurance in excess of this amount shall be paid by the
warehouseman.
D. To remove no commodity covered by negotiable warehouse receipts
registered with the Exchange from the designated warehouse or, if
appropriate, from the designated bond save at the request of the
negotiable warehouse receipt holder upon surrender of the receipt.
E. To register with the Exchange all negotiable warehouse receipts
relating to commodities for which the warehouse is declared regular
and to cancel such registrations before releasing property.
F. To have a representative in Chicago, Illinois authorized and known to
the Exchange to act in matters pertaining to negotiable warehouse
receipts including shipping instructions.
G. To load vehicles furnished by holders of negotiable warehouse receipts
of the Exchange within the time specified by these rules and
regulations.
H. To furnish the Exchange with copies of policies or certificates of
insurance under which deliverable commodities in the warehouse are
insured.
I. To deliver commodities ordered out of the warehouse in buyer's
vehicles within such times as specified by these rules and regulations
showing no preference in out-loading, unless conditions such as acts
of God, fire, flood, windstorm, explosion or other force majeure
interfere therewith; provided, the warehouse shall make no charge for
storage after three days following receipt of the load-out order
notwithstanding delivery is prevented because of such act of God, etc.
If no time period for out-loading is set forth in the rules or
regulations of a given contract, load-out under such contract shall
occur not later than three business days after vehicles are ready for
loading, except as provided herein.
J. To inspect the transportation facilities furnished by the negotiable
warehouse receipt holder. If, in the warehouseman's judgement,
cleaning is necessary, he shall immediately notify the
Ch37 Delivery Facilities and Procedures
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receipt holder and thereafter abide by the holder's instructions.
K. To load each vehicle to its capacity providing sufficient negotiable
warehouse receipts are tendered.
L. To bear the costs of all expenses contingent upon transfer of title of
the warehoused commodity to another regulated warehouse satisfactory
to the owners of such commodity in the event of expiration or
revocation of regularity or in the event of abandonment or sale of the
properties where regularity is not reissued. (11/01/94)
3704.04 Safeguarding Condition Of Stored Commodities -
A. Whenever in the opinion of the operator of the warehouse any commodity
stored in a public warehouse under his jurisdiction should be loaded
out in order to protect the best interests of the parties concerned,
such operator shall notify the Exchange giving the location and grades
of such commodity. The Exchange shall immediately notify an
appropriate inspection service which shall at once proceed to the
warehouse in which the commodity is stored and examine it in
conjunction with the operator of such warehouse. If the inspection
service agrees with the operator that the commodity should be moved,
it shall so notify the Registrar. If the inspection service does not
agree with the operator that the commodity should be moved, the
operator of the warehouse shall have the right to appeal to the
Business Conduct Committee of the Exchange. If on such appeal the
Business Conduct Committee shall agree with the operator that the
commodity should be moved, the committee shall so notify the
Registrar, and the warehouse receipts covering the above specified lot
or lots shall no longer be regular for delivery on futures contracts.
Upon receiving such notice, either from the inspection service or from
the Business Conduct Committee, the Registrar shall notify the holder,
or holders, or their agents, together with the Chairman of the
Business Conduct Committee, of the total quantity of the grade of
commodity in question (selecting the oldest registered warehouse
receipt first, then such additional registered warehouse receipts in
the order of their issuance as may be necessary to equal such total
quantity of the commodity).
When this information reaches the Chairman of the Business Conduct
Committee, he shall appoint a Committee consisting of five
disinterested handlers of the cash commodity. This Committee shall
meet at once and after taking into consideration various factors that
establish the value of the grade of the receipts held by such owner or
owners, shall determine the fair value of the commodity, which price
shall be that to be paid by the operator. If the price offered is not
satisfactory, a Committee appointed by the Chairman of the Business
Conduct Committee (at the request of such owner), shall procure other
offers for such commodity, and such offers shall be immediately
reported to the owner or his agent. If the owner refuses to accept any
such offers, he shall have the two following business days to order
and furnish facilities for loading the commodity out of store, and
during this period the warehouse shall be obliged to deliver the
commodity called for by the warehouse receipts, but not more than
three (3) days may elapse after notification by the Registrar to the
holder of the receipt before satisfactory disposition shall have been
made of the commodity, either by sale to the operator or by the
ordering out and furnishing facilities to load the same, provided the
amount of such commodity does not exceed 20,000 hundredweight of rough
rice in any one warehouse. If the amount of commodity in question
exceeds such amount, the owner, or owners, of the warehouse receipts
shall be allowed forty-eight hours of grace over and above the
aforementioned three days for each additional 20,000 hundredweight.
B. In the event that the holder of the warehouse receipt, or his agent,
fails to move the commodity or make other satisfactory disposition of
same within the prescribed time, it shall be held for his account, and
any loss in grade sustained shall likewise be for his account.
C. Nothing in the foregoing provisions shall be construed as prohibiting
the warehouseman from fulfilling contracts from other stocks under his
control. (11/01/94)
3704.05 Damage To Commodity In Store - Notice - The operator of a warehouse
shall promptly advise the Exchange of any damage to a commodity held in store by
it whenever such damage shall
Ch37 Delivery Facilities and Procedures
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occur to an extent that will render it unwilling to purchase and withdraw from
store, at its cost, all such damaged commodity. (11/01/94)
3704.06 Revocation of Regularity - Any declaration of regularity may be
withdrawn by the Exchange at any time if the warehouse does not comply with the
conditions above set forth or fails to carry out prescribed duties; providing,
however, the Exchange has theretofore given notice to the warehouseman of the
deficiencies and a reasonable time, under the circumstances, to cure them.
If the designation is revoked, the Exchange shall post such revocation on the
bulletin board together with the period of time, if any, during which the
negotiable warehouse receipts issued by the warehouse will be deliverable in
satisfaction of futures contracts.
Once such period of time, if any, has expired, and the negotiable warehouse
receipts issued by the warehouse are no longer deliverable in satisfaction of
futures contracts, the warehouse shall bear the cost of the transfer of the
warehoused commodity to another regulated warehouse, in accordance with 3704.03,
paragraph L. (11/01/94)
3704.07 Federal Warehouses - In compliance with the provisions of Section
5a(7) of the Commodity Exchange Act, providing that the commodity may be
delivered from a warehouse subject to the United States Warehouse Act, 7 U.S.C.
Sections 241-273, a receipt issued under that Act shall be accepted for delivery
on any futures contract provided the commodity represented by the receipt meets
contract specifications and the warehouse issuing the receipt meets the
requirements imposed by this chapter on all other warehouses. (11/01/94)
3704.08 Finality of USDA Or Other Required Inspection Certificate - The
Exchange assumes no responsibility and disclaims all liability on account of the
grade, quantity or specifications of any commodity delivered on the basis of a
USDA or other required inspection certificate. Such certificate shall constitute
conclusive evidence of the grade, quantity or other specifications of the
commodity described therein. (11/01/94)
3705.01 Delivery Through Clearing House - All deliveries on maturing contracts
shall be made through the Clearing House. The Clearing House shall prescribe
such forms and requirements for initiating and completing delivery as are
consistent with this chapter and the various contract specification chapters.
(11/01/94)
3705.02 Payment Upon Delivery - The receiver of a Notice of Intention from the
Clearing House shall present the delivery invoice at the office of the deliverer
not later than 1:00 p.m. on the next business day, i.e., delivery day, together
with a certified or cashier's check drawn on a Chicago bank, and shall receive
therefore, properly endorsed, warehouse receipts or shipping certificates in
accordance with the Notice and any other contract documents required under these
rules and regulations.
If said delivery day is a banking holiday, delivery and payment must be made
before 9:30 a.m. the next banking business day and the seller shall be
responsible for storage charges up to and including that banking holiday.
Adjustments for differences between contract prices and delivery prices
established by the Clearing House shall be made with the Clearing House in
accordance with its Regulations. (11/01/94)
3705.03 Necessity Of Possession Of Documents - The deliverer shall at such
time as the Notice of Intent is delivered to the Clearing House have possession
of all documents (except a warehouse receipt in the case of a redelivery)
necessary to make good delivery. (11/01/94)
3705.04 Suspended Member Out Of Line For Delivery - When a member of the
Clearing House who has open purchases is suspended from the clearing House for
default or insolvency, he shall be deemed out of line for delivery and tender
shall be made to the buyer obligated upon the next oldest contract. Also, if
tender be made to a buyer who is thereafter suspended for default or insolvency
before delivery is accepted, the Notice shall be withdrawn and another
immediately served upon the buyer obligated upon the next oldest contract.
(11/01/94)
3705.05 Failure to Deliver - A clearing member who has not tendered a Notice
on or before 8:00 p.m. on the last day in a delivery month on which such notice
is permitted shall be in default. Failure to make delivery shall constitute
improper conduct. In addition to the penalties provided under Exchange
Ch37 Delivery Facilities and Procedures
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rules and regulations, the Exchange shall determine and assess the damages
incurred by the buyer, taking into account the settlement price and such other
factors as it may deem just. (11/01/94)
3705.06 Failure To Accept Delivery -
A. If a clearing member fails to accept delivery, the commodity shall be
sold for the account of the buyer by the Exchange. If the proceeds are
insufficient to pay the seller the full delivery price, the clearing
member failing to accept delivery shall be liable for the difference.
B. If a clearing member is unable or refuses to make full payment to the
seller, the Clearing House shall bear the seller's loss in the first
instance.
C. Failure to accept delivery or make full payment shall also constitute
improper conduct. (11/01/94)
3705.07 Transfer Of Cash For Futures After Termination Of Contract - Subject
to the Exchange approval, a transfer of cash merchandise for futures may be
permitted during the contract month after termination of the contract.
Such transfer of cash for futures shall be cleared through the Clearing House in
accordance with normal procedures and shall be made at the prices as are
mutually agreed upon by the two parties to the transaction. Such transfers shall
be clearly designated by proper symbol as transfer transactions and shall be
recorded by the Exchange and the clearing member to the transactions, and proper
notice given to the membership. Each party to such transaction must satisfy the
Exchange that the transaction is bona fide and must file with the Clearing House
all memoranda necessary to establish the nature of the transaction, the kind and
quantity of the cash commodity, the kind, quantity and price of the commodity
future, the names of all clearing members to the transaction and such other
information as the Clearing House or Exchange may require.
Such transfer of cash for futures shall bear the normal commission charges
pursuant to deliveries. (11/01/94)
3705.08 Risk Of Loss And Charges -
A. Title and the risk of loss or damage pass to the buyer at the time of
delivery of the warehouse receipts.
B. The deliverer shall be responsible for all warehouse charges until the
time when title passes and thereafter the receiver shall be
responsible.
C. The receiver shall be responsible for all inspection and weighing
charges at load-out. (11/01/94)
================================================================================
Chapter 38
CBOT Rough Rice Options
================================================================================
Ch38 Trading Conditions...........................................
3800.01 Scope Of Chapter...................................
3801.01 Unit Of Trading....................................
3802.01 Options Call.......................................
3803.01 Striking Prices....................................
3804.01 Option Exercise....................................
3805.01 Daily Price Limits.................................
3806.01 Automatic Exercise.................................
================================================================================
Chapter 38
CBOT Rough Rice Options
================================================================================
Ch38 Trading Conditions
3800.01 Scope Of Chapter - This chapter is limited in application to the
trading of put and call options exercisable for Chicago Board of Trade Rough
Rice futures contracts. Procedures for trading, clearing and any other matters
not specifically covered herein shall be governed by the rules of the
Association. (11/01/94)
3801.01 Unit Of Trading - The unit of trading shall be a put or call option
exercisable for (1) 2,000 hundredweight Chicago Board of Trade rough rice
futures contract. (11/01/94)
3802.01 Options Call -
A. Hours Of Trading - The hours of options trading shall be
concurrent with the hours of the underlying futures contract.
B. Contract Months - Trading may be conducted in the nearby rough
rice options contract month plus any succeeding months, provided
however that the Exchange may determine not to list a contract
month. For options that are traded in months in which rough rice
futures are not traded, the underlying futures contract is the
next futures contract that is nearest to the expiration of the
option. For example, the underlying futures contract for the
February option contract is the March futures contract.
*C. Termination Of Trading - No trades in rough rice futures options
expiring in the current month shall be made after the close of
trading of the Regular Daytime open outcry trading session for
the corresponding Rough Rice futures contract on the last Friday
which precedes, by at least two [five] business days, the last
---
business day of the month preceding the option month. If such
Friday is not a business day, then trading shall terminate on the
preceding business day prior to such Friday.
On the last day of trading in an expiring option class, the
expiring options shall be closed with a public call made striking
price by striking price, conducted by such persons as the
Exchange shall direct.
* Additions underlined, deletions bracketed for contracts from May 2001
forward.
D. Option Expiration - The contractual rights and obligations
arising from the unexercised option contract expire at 10:00 a.m.
on the first Saturday following the last trading day.
E. Option Premium Basis - The minimum price fluctuation of the
option premium shall be $0.0025 per hundredweight or $5.00 per
contract.
However, when both sides of the trade are closing transactions,
the option premium may range from $1.00 to $4.00 in $1.00
increments per option contract.
F. Position Limits And Reportable Positions - (See Regulation
425.01) (10/01/00)
3803.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices (the "strikes") in integral multiples of twenty (20) cents
per hundredweight per rough rice futures contract (i.e., 7.80, 8.00, 8.20, etc.)
and in integral multiples of forty (40) cents per hundredweight per rough rice
futures contract (i.e. 8.00, 8.40, 8.80, etc.) as follows:
A. 1. In integral multiples of twenty cents, at the commencement of
trading for an option contract, the following strikes shall be
listed: one with a strike closest to the previous day's
settlement price of the underlying rough rice futures contract,
the next five consecutive higher and the next five consecutive
lower strikes (the "initial band"). If the previous day's
settlement price is midway between two strikes, the closest price
shall be the larger of the two.
2. In integral multiples of forty cents, at the commencement of
trading for an option
Ch38 Trading Conditions
-----------------------
contract, the following strikes shall be listed: the next four
consecutive strikes above the initial band.
3. In integral multiples of twenty cents, over time, strikes shall
be added as necessary to insure that all strikes within $1.10 of
the previous day's trading range of the underlying futures
contract are listed (the "minimum band").
4. In integral multiples of forty cents, over time, strikes shall be
added as necessary to insure that the next four consecutive
strikes above the minimum band are listed.
5. No new strikes may be added by these procedures in the month in
which an option expires.
B. 1. In integral multiples of forty cents, all strikes in which the
previous day's delta factors (as determined by the Exchange) for
both the put and call options are 0.10 or greater for two
consecutive business days will be listed for trading. However, no
new strikes may be added by this procedure to an option month
unless open positions exist in that contract month.
2. In integral multiples of twenty cents, during the month in which
an option expires, all strikes in which the previous day's delta
factors (as determined by the Exchange) for both the put and call
options are 0.10 or greater for two consecutive business days
will be listed for trading.
C. All strikes will be listed prior to the opening of trading on the
following business day. The Exchange may modify the procedures for the
introduction of strikes as it deems appropriate in order to respond to
market conditions. (11/01/94)
3804.01 Option Exercise - An option holder intending to exercise shall present
to the clearing house, no later than 6:00 p.m., or by such other time designated
by the Board of Directors, on any business day through and including the last
trading day, on a form prescribed thereby, a notice of exercise.
The clearing house shall assign such a notice promptly and at random to a
clearing member carrying a short position in the option series. Said clearing
member in turn shall assign such notice to accounts with an open short option
position in a fair and non-preferred manner in accordance with written
procedures. By the opening of the next trading session, in the case of a call
option, the writer shall sell to the holder by book entry the underlying futures
contract at the contracted striking price. In the case of a put option, the
writer shall buy from the holder by book entry the underlying futures contract
at the contracted striking price. Thenceforth, the writer and the holder assume
the rights and obligations associated with their respective positions in the
underlying futures contract.
Notwithstanding the foregoing, an option holder may exercise an option prior to
10:00 a.m. on the expiration date:
A. to correct errors or mistakes made in good faith;
B. to take appropriate action as the result of unreconciled Exchange
option transactions;
C. in exceptional cases involving a customer's inability to communicate
exercise instructions to the member firm or the member firm's
inability to receive such instructions prior to 6:00 p.m. on the last
day of trading. (12/01/99)
3805.01 Daily Price Limits - Trading in a rough rice futures option shall be
confined to a premium no greater than the trading limit for the rough rice
futures contract above and below the option's previous day settlement premium
for all trading days except the last. (11/01/94)
3806.01 Automatic Exercise - Notwithstanding the provisions of Regulation
3804.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the clearing house.
Notice to cancel automatic exercise shall be given to the clearing house by 6:00
p.m., or by such other time designated by the Board of Directors, on the last
day of trading, except that such notice may be given to the clearing house prior
to 10:00 a.m. on the expiration date:
Ch38 Trading Conditions
-----------------------
A. to correct errors or mistakes made in good faith;
B. to take appropriate action as the result of unreconciled Exchange
option transactions;
C. in exceptional cases involving a customer's inability to
communicate exercise instructions to the member firm or the
member firm's inability to receive such instructions prior to
6:00 p.m. on the last day of trading. (12/01/99)
[Enlarge/Download Table]
===============================================================================================================
Chapter 39
CBOT(R) Dow Jones Utility Average(SM) Index Futures
===============================================================================================================
Ch 39 Trading Conditions........................................................................
3901.00 Authority...................................................................
3902.01 Application of Regulation...................................................
3903.01 Emergencies, Acts of God, Acts of Government................................
3904.01 Unit of Trading.............................................................
3905.01 Months Traded In............................................................
3906.01 Price Basis.................................................................
3907.01 Hours of Trading............................................................
3908.01 Price Limits and Trading Halts..............................................
3909.01 Last Day of Trading.........................................................
3909.02 Liquidation During the Delivery Month.......................................
3910.01 Margin Requirements.........................................................
3912.01 Position Limits and Reportable Positions....................................
Ch 39 Delivery Procedures.......................................................................
3936.01 Standards...................................................................
3942.01 Delivery on Futures Contracts...............................................
3942.02 Final Settlement Price......................................................
3942.03 The Final Settlement Day....................................................
3947.01 Payment.....................................................................
3948.01 Disclaimer..................................................................
================================================================================
Chapter 39
CBOT(R) Dow Jones Utility Average(SM) Index/1/ Futures
================================================================================
Trading Conditions
3901.00 Authority-- -- (See 1701.00) (08/01/00)
3902.01 Application of Regulations -- Futures transactions in CBOT Dow
Jones Utility Average ("DJUA ") Index contracts shall be
subject to the general rules of the Association as far as
applicable and shall also be subject to the regulations
contained in this chapter, which are exclusively applicable to
trading in CBOT Dow Jones Utility Average Index contracts.
(08/01/00)
3903.01 Emergencies, Acts of God, Acts of Government -- If the
delivery or acceptance or any precondition or requirement of
either, is prevented by strike, fire, accident, act of
government, act of God or other emergency, the seller or buyer
shall immediately notify the Chairman. If the Chairman
determines that emergency action may be necessary, he shall
call a special meeting of the Board and arrange for the
presentation of evidence respecting the emergency condition.
If the Board determines that an emergency exists, it shall
take such action under Rule 180.00 as it deems necessary under
the circumstances and its decision shall be binding upon all
parties to the contract. (08/01/00)
3904.01 Unit of Trading -- The unit of trading shall be $250 times the
Dow Jones Utility Average . The Dow Jones Utility Average is a
price-weighted composite index of 15 utility stocks.
(08/01/00)
3905.01 Months Traded In -- The months listed for trading are March,
June, September and December, at the discretion of the
Exchange. (08/01/00)
3906.01 Price Basis -- The price of the CBOT Dow Jones Utility Average
Index futures shall be quoted in one twentieths of a point.
One point equals $250.00. The minimum price
_____________________
/1/ /1/ "Dow Jones", "Dow Jones Utility Average" and "DJUA" are service marks of
Dow Jones & Company, Inc. and have been licensed for use for certain
purposes by the Board of Trade of the City of Chicago (CBOT(R)). The CBOT's
futures and futures options contracts based on the Dow Jones Utility Average
are not sponsored, endorsed, sold or promoted by Dow Jones, and Dow Jones
makes no representation regarding the advisability of trading in such
product(s).
Ch 39 Trading Conditions
fluctuation shall be one twentieth of a point per contract
($12.50). Contracts shall not be made on any other price
basis. (08/01/00)
3907.01 Hours of Trading -- The hours of trading for future delivery
in CBOT Dow Jones Utility Average Index futures shall be
determined by the Board.
The market shall be opened and closed for all months
simultaneously, or in such other manner as the Regulatory
Compliance Committee shall direct. (08/01/00)
3908.01 Price Limits and Trading Halts -- (See Regulation 1008.01)
(08/01/00)
3909.01 Last Day of Trading -- The last day of trading in CBOT Dow
Jones Utility Average Index futures contracts deliverable in
the current delivery month shall be the trading day
immediately preceding the final settlement day (as described
in Regulation 3942.03). (08/01/00)
3909.02 Liquidation During the Delivery Month -- After trading in
contracts for future delivery in the current delivery month
has ceased, in accordance with Regulation 3909.01 of this
chapter, outstanding contracts for such delivery shall be
liquidated by cash settlement as prescribed in Regulation
3942.01. (08/01/00)
3910.01 Margin Requirements -- Margin requirements shall be as
determined by the Board by regulation. (08/01/00)
3912.01 Position Limits and Reportable Positions -- (See 425.01)
(08/01/00)
Delivery Procedures
3936.01 Standards -- The contract grade shall be the final settlement
price (as described in Regulation 3942.02) of the Dow Jones
Utility Average Index on final settlement day (as described in
Regulation 3942.03). (08/01/00)
3942.01 Delivery on Futures Contracts -- Delivery against the CBOT Dow
Jones Utility Average Index Futures contract must be made
through the Clearing Corporation. Delivery under these
regulations shall be on the final settlement day (as described
in regulation 3942.03) and shall be accomplished by cash
settlement as hereinafter provided. (08/01/00)
Clearing members holding open positions in a CBOT Dow Jones
Utility Average Index futures contract at the time of
termination of trading shall make payment to and receive
payment through the Clearing Corporation in accordance with
normal variation settlement procedures based on a settlement
price equal to the final settlement price (as described in
Regulation 3942.02). (08/01/00)
3942.02 Final Settlement Price -- The final settlement price shall be
determined on the final settlement day. The final settlement
price shall be $250 times a Special Open Quotation (SOQ) of
the Dow Jones Utility Average Index based on the opening
prices of the component stocks in the index, or on the last
sale price of a stock that does not open for trading on the
regularly scheduled day of final settlement (as described in
Regulation 3942.03). (08/01/00)
If the designated primary market for a component stock does
not open on the day scheduled for the determination of the
final settlement price, then the final settlement price shall
be based on the next opening prices for such component stock.
(08/01/00)
3942.03 The Final Settlement Day -- The final settlement day shall be
defined as the third Friday of the contract month, or if the
Dow Jones Utility Average is not published for that day, the
first preceding business day for which the Dow Jones Utility
Average is scheduled to be published. (08/01/00)
3947.01 Payment -- See Regulation 1049.04. (08/01/00)
3948.01 Disclaimer
CBOT Dow Jones Utility Average Index futures and futures
options contracts are not sponsored, endorsed, sold or
promoted by Dow Jones. Dow Jones makes no representation or
warranty, express or implied, to the owners of CBOT Dow Jones
Utility Average Index futures and futures options contracts or
any member of the public regarding the advisability of trading
in CBOT Dow Jones Utility Average Index futures and futures
options contracts. Dow Jones' only relationship to the
Exchange is the licensing of certain trademarks and trade
names of Dow Jones and of the Dow Jones Utility Average which
is determined, composed and calculated by Dow Jones without
regard to the Chicago Board of Trade or CBOT Dow Jones Utility
Average Index futures and futures options contracts, Dow Jones
has no obligation to take the needs of the Chicago Board of
Trade or the owners of CBOT Dow Jones Utility Average Index
futures and futures options contracts into consideration in
determining, composing or calculating the Dow Jones Utility
Average . Dow Jones is not responsible for and has not
participated in the determination of the timing of, prices at,
or quantities of CBOT Dow Jones Utility Average Index futures
and futures options contracts to be listed or in the
determination or calculation of the equation by which CBOT Dow
Jones Utility Average Index futures and futures options
contracts are to be converted into cash. Dow Jones has no
Delivery Procedures
obligation or liability in connection with the administration,
marketing or trading of the CBOT Dow Jones Utility Average
Index futures and futures options contracts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE
COMPLETENESS OF THE DOW JONES UTILITY AVERAGE OR ANY DATA
INCLUDED THEREIN AND DOW JONES SHALL HAVE NO LIABILITY FOR ANY
ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. DOW JONES MAKES
NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED
BY THE CHICAGO BOARD OF TRADE, OWNERS OF CBOT DOW JONES
UTILITY AVERAGE INDEX FUTURES AND FUTURES OPTIONS CONTRACTS,
OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE DOW JONES
UTILITY AVERAGE OR ANY DATA INCLUDED THEREIN. DOW JONES MAKES
NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OR USE WITH RESPECT TO THE DOW JONES UTILITY AVERAGE
OR ANY DATA INCLUDED THEREIN, WITHOUT LIMITING ANY OF THE
FOREGOING, IN NO EVENT SHALL DOW JONES HAVE ANY LIABILITY FOR
ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR
CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF
NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO
THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS
BETWEEN DOW JONES AND THE CHICAGO BOARD OF TRADE. (08/01/00)
===============================================================================
Chapter 41
CBOT(R) Dow Jones Composite Average(SM) Index Futures
===============================================================================
Ch 41 Trading Conditions...............................................
4101.00 Authority..............................................
4102.01 Application of Regulation..............................
4103.01 Emergencies, Acts of God, Acts of Government...........
4104.01 Unit of Trading........................................
4105.01 Months Traded In.......................................
4106.01 Price Basis............................................
4107.01 Hours of Trading.......................................
4108.01 Price Limits and Trading Halts.........................
4109.01 Last Day of Trading....................................
4109.02 Liquidation During the Delivery Month..................
4110.01 Margin Requirements....................................
4112.01 Position Limits and Reportable Positions...............
Ch 41 Delivery Procedures..............................................
4136.01 Standards..............................................
4142.01 Delivery on Futures Contracts..........................
4142.02 Final Settlement Price.................................
4142.03 The Final Settlement Day...............................
4147.01 Payment................................................
4148.01 Disclaimer.............................................
===============================================================================
Chapter 41
CBOT(R) Dow Jones Transportation Average(SM) Index/1/
Futures
===============================================================================
Ch 41 Trading Conditions
4101.00 Authority -- (See 1701.00.) (08/01/00)
4102.01 Application of Regulations -- Futures transactions in CBOT Dow Jones
Transportation Average(SM) ("DJTA") Index contracts shall be subject
to the general rules of the Association as far as applicable and
shall also be subject to the regulations contained in this chapter,
which are exclusively applicable to trading in CBOT Dow Jones
Transportation Average(SM) Index contracts. (08/01/00)
4103.01 Emergencies, Acts of God, Acts of Government -- If the delivery or
acceptance or any precondition or requirement of either is prevented
by strike, fire, accident, act of government, act of God, or other
emergency, the seller or buyer shall immediately notify the Chairman.
If the Chairman determines that emergency action may be necessary, he
shall call a special meeting of the Board and arrange for the
presentation of evidence respecting the emergency condition. If the
Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and
its decision shall be binding upon all parties to the contract.
(08/01/00)
4104.01 Unit of Trading-- The unit of trading shall be $20.00 times the Dow
Jones Transportation Average(SM). The Dow Jones Transportation
Average(SM) is a price-weighted composite index of twenty (20) U.S.
stocks. (08/01/00)
4105.01 Months Traded In -- The months listed for trading are March, June,
September, and December, at the discretion of the Exchange.
(08/01/00)
4106.01 Price Basis -- The price of the CBOT Dow Jones Transportation
Average(SM) Index futures shall be quoted in points. One point equals
$20.00. The minimum price fluctuation shall be one-half (1/2) of one
point, or $10.00 per contract. Contracts shall not be made on any
other price basis. (08/01/00)
4107.01 Hours of Trading -- The hours of trading for future delivery in CBOT
Dow Jones Transportation Average(SM) Index futures shall be
determined by the Board.
The market shall be opened and closed for all months simultaneously,
or in such other manner as the Regulatory Compliance Committee shall
direct. (08/01/00)
4108.01 Price Limits and Trading Halts (See Regulation 1008.01.) (08/01/00)
4109.01 Last Day of Trading -- The last day of trading in CBOT Dow Jones
Transportation Average(SM) Index futures contracts deliverable in the
current delivery month shall be the trading day immediately preceding
the final settlement day (as described in Regulation
_________________________
/1/ "Dow Jones", "Dow Jones Transportation Average" and "DJTA" are service
marks of Dow Jones & Company, Inc. and have been licensed for use for certain
purposes by the Board of Trade of the City of Chicago (CBOT(R)). The CBOT's
futures and futures options contracts based on the Dow Jones Transportation
Average are not sponsored, endorsed, sold or promoted by Dow Jones, and Dow
Jones makes no representation regarding the advisability of trading in such
product(s).
Ch 41 Trading Conditions
4142.03).(08/01/00)
4109.02 Liquidation During the Delivery Month -- After trading in
contracts for future delivery in the current delivery month
has ceased, in accordance with Regulation 4109.01 of this
chapter, outstanding contracts for such delivery shall be
liquidated by cash settlement as prescribed in Regulation
4142.01. (08/01/00)
4110.01 Margin Requirements -- Margin requirements shall be as determined by
the Board by regulation. (08/01/00)
4112.01 Position Limits and Reportable Positions -- (See 425.01.) (08/01/00)
Delivery Procedures
4136.01 Standards -- The contract grade shall be the final settlement price
(as described in Regulation 4142.02) of the Dow Jones Transportation
Average(SM) Index on final settlement day (as described in Regulation
4142.03). 08/01/00)
4142.01 Delivery on Futures Contracts -- Delivery against the CBOT Dow Jones
Transportation Average(SM) Index Futures contract must be made
through the Clearing Corporation. Delivery under these regulations
shall be on the final settlement day (as described in regulation
4142.03) and shall be accomplished by cash settlement as hereinafter
provided.
Clearing members holding open positions in a CBOT Dow Jones
Transportation Average(SM) Index futures contract at the time of
termination of trading shall make payment to and receive payment
through the Clearing Corporation in accordance with normal variation
settlement procedures based on a settlement price equal to the final
settlement price (as described in Regulation 4142.02). (08/01/00)
4142.02 Final Settlement Price-- The final settlement price shall be
determined on the final settlement day. The final settlement price
shall be $20.00 times a Special Open Quotation (SOQ) of the Dow Jones
Transportation Average(SM) Index based on the opening prices of the
component stocks in the index, or on the last sale price of a stock
that does not open for trading on the regularly scheduled day of
final settlement (as described in Regulation 4142.03).
If the designated primary market for a component stock in the index
does not open on the day scheduled for the determination of the final
settlement price, then the final settlement price shall be based on
the next opening price for such component stock. (08/01/00)
4142.03 The Final Settlement Day -- The final settlement day shall be defined
as the third Friday of the contract month, or if the Dow Jones
Transportation Average(SM) is not scheduled to be published for that
day, the first preceding business day for which the Dow Jones
Transportation Average(SM) is scheduled to be published. (08/01/00)
4147.01 Payment -- (See Regulation 1049.04.) (08/01/00)
4148.01 Disclaimer
CBOT Dow Jones Transportation Average(SM) Index futures and futures
options contracts are not sponsored, endorsed, sold or promoted by
Dow Jones. Dow Jones makes no representation or warranty, express or
implied, to the owners of CBOT Dow Jones Transportation Average(SM)
Index futures and futures options contracts or any member of the
public regarding the advisability of trading in CBOT Dow Jones
Transportation Average(SM) Index futures and futures options
contracts. Dow Jones' only relationship to the Exchange is the
licensing of certain service marks and trade names of Dow Jones and
of the Dow Jones Transportation Average(SM) which is determined,
composed and calculated by Dow Jones without regard to the Chicago
Board of Trade or CBOT Dow Jones Transportation Average(SM) Index
futures and futures options contracts, Dow Jones has no obligation to
take the needs of the Chicago Board of Trade or the owners of CBOT
Dow Jones Transportation Average(SM) Index futures and futures
options contracts into consideration in determining, composing or
calculating the Dow Jones Transportation Average(SM). Dow Jones is
not responsible for and has not participated in the determination of
the timing of, prices at, or quantities of CBOT Dow Jones
Transportation
Ch 41 Delivery Procedures
Average(SM) Index futures and futures options contracts to be listed
or in the determination or calculation of the equation by which CBOT
Dow Jones Transportation Average(SM) Index futures and futures
options contracts are to be converted into cash. Dow Jones has no
obligation or liability in connection with the administration,
marketing or trading of the CBOT Dow Jones Transportation Average(SM)
Index futures and futures options contracts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF
THE DOW JONES TRANSPORTATION AVERAGE(SM) OR ANY DATA INCLUDED THEREIN
AND DOW JONES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR
INTERRUPTIONS THEREIN. DOW JONES MAKES NO WARRANTY, EXPRESS OR
IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE CHICAGO BOARD OF TRADE,
OWNERS OF CBOT DOW JONES TRANSPORTATION AVERAGE(SM) INDEX FUTURES AND
FUTURES OPTIONS CONTRACTS, OR ANY OTHER PERSON OR ENTITY FROM THE USE
OF THE DOW JONES TRANSPORTATION AVERAGE(SM) OR ANY DATA INCLUDED
THEREIN. DOW JONES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND
EXPRESSLY DISCLAIMS ALL WARRANTIES, OR MERCHANTABILITY OR FITNESS FOR
A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE DOW JONES
TRANSPORTATION AVERAGE(SM) OR ANY DATA INCLUDED THEREIN, WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL DOW JONES HAVE ANY
LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR
CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF
THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO THIRD PARTY
BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN DOW JONES AND
THE CHICAGO BOARD OF TRADE. (08/01/00)
[Enlarge/Download Table]
=========================================================================================================
Chapter 43
CBOT(R) Dow Jones Industrial Average(SM) Index Futures
=========================================================================================================
Ch 43 Trading Conditions.....................................................................
4301.00 Authority...................................................................
4302.01 Application of Regulation...................................................
4303.01 Emergencies, Acts of God, Acts of Government................................
4304.01 Unit of Trading.............................................................
4305.01 Months Traded In............................................................
4306.01 Price Basis.................................................................
4307.01 Hours of Trading............................................................
4308.01 Price Limits and Trading Halts..............................................
4309.01 Last Day of Trading.........................................................
4309.02 Liquidation During the Delivery Month.......................................
4310.01 Margin Requirements.........................................................
4312.01 Position Limits and Reportable Positions....................................
Ch 43 Delivery Procedures....................................................................
4336.01 Standards...................................................................
4342.01 Delivery on Futures Contracts...............................................
4342.02 Final Settlement Price......................................................
4342.03 The Final Settlement Day....................................................
4347.01 Payment.....................................................................
4348.01 Disclaimer..................................................................
================================================================================
Chapter 43
CBOT(R) Dow Jones Industrial Average(SM) Index/1/ Futures
================================================================================
Ch 43 Trading Conditions
4301.00 Authority - (See 1701.00) (11/01/97)
4302.01 Application of Regulations - Futures transactions in CBOT Dow Jones
Industrial Average(SM) ("DJIA") Index contracts shall be subject to the general
rules of the Association as far as applicable and shall also be subject to the
regulations contained in this chapter, which are exclusively applicable to
trading in CBOT Dow Jones Industrial Average(SM) Index contracts. (09/01/00)
4303.01 Emergencies, Acts of God, Acts of Government - If delivery or
acceptance or any precondition or requirement of either, is prevented by
strike, fire, accident, act of government, act of God or other emergency, the
seller or buyer shall immediately notify the Chairman. If the Chairman
determines that emergency action may be necessary, he shall call a special
meeting of the Board and arrange for the presentation of evidence respecting
the emergency condition. If the Board determines that an emergency exists, it
shall take such action under Rule 180.00 as it deems necessary under the
circumstances and its decision shall be binding upon all parties to the
contract. (11/01/97)
4304.01 Unit of Trading - The unit of trading shall be $10.00 times the Dow
Jones Industrial Average(SM). The Dow Jones Industrial Average(SM) is a price-
weighted composite index of 30 stocks. (11/01/97)
4305.01 Months Traded In - The months listed for trading are March, June,
September and December, at the discretion of the Exchange. (11/01/97)
4306.01 Price Basis - The price of the CBOT Dow Jones Industrial Average(SM)
Index futures shall be quoted in points. One point equals $10.00. The minimum
price fluctuation shall be one point per contract. Contracts shall not be made
on any other price basis. (11/01/97)
4307.01 Hours of Trading - The hours of trading for future delivery in CBOT
Dow Jones Industrial Average(SM) Index futures shall be determined by the
Board.
The market shall be opened and closed for all months simultaneously, or in such
other manner as the Regulatory Compliance Committee shall direct. (11/01/97)
4308.01 Price Limits and Trading Halts - (See Regulation 1008.01) (11/01/97)
4309.01 Last Day of Trading - The last day of trading in CBOT Dow Jones
Industrial Average
_____________________
1 "Dow Jones(SM)", "The Dow(SM)", Dow Jones Industrial Average(SM)" and
"DJIA(SM)" are service marks of Dow Jones & Company, Inc. and have
been licensed for use for certain purposes by the Board of Trade of
the City of Chicago ("CBOT".). The CBOT's futures and futures option
contracts based on the Dow Jones Industrial Average(SM) are not
sponsored, endorsed, sold or promoted by Dow Jones, and Dow Jones,
and Dow Jones makes no representation regarding the advisability of
trading in such product(s).
Ch 43 Trading Conditions
------------------------
Index futures contracts deliverable in the current delivery month shall be the
trading day immediately preceding the final settlement day (as described in
Regulation 4342.03). (11/01/97)
4309.02 Liquidation During the Delivery Month - After trading in contracts
for future delivery in the current delivery month has ceased, in accordance with
Regulation 4309.01 of this chapter, outstanding contracts for such delivery
shall be liquidated by cash settlement as prescribed in Regulation 4342.01.
(11/01/97)
4310.01 Margin Requirements - (See Regulation 431.03) (11/01/97)
4312.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(11/01/97)
Ch 43 Delivery Procedures
4336.01 Standards - The contract grade shall be the final settlement price
(as described in Regulation 4342.02) of the Dow Jones Industrial Average(SM)
Index on final settlement day (as described in Regulation 4342.03). (11/01/97)
4342.01 Delivery on Futures Contracts - Delivery against the CBOT Dow Jones
Industrial Average(SM) Index Futures contract must be made through the Clearing
Corporation. Delivery under these regulations shall be on the final settlement
day (as described in regulation 4342.03) and shall be accomplished by cash
settlement as hereinafter provided.
Clearing members holding open positions in a CBOT Dow Jones Industrial
Average(SM) Index futures contract at the time of termination of trading shall
make payment to and receive payment through the Clearing Corporation in
accordance with normal variation settlement procedures based on a settlement
price equal to the final settlement price (as described in Regulation 4342.02).
(11/01/97)
4342.02 Final Settlement Price - The final settlement price shall be
determined on the final settlement day. The final settlement price shall be $10
times a Special Open Quotation (SOQ) of the Dow Jones Industrial Average(SM)
Index based on the opening prices of the component stocks in the index, or on
the last sale price of a stock that does not open for trading on the regularly
scheduled day of final settlement (as described in Regulation 4342.03).
If the New York Stock Exchange ("NYSE") does not open on the day scheduled for
the determination of the final settlement price, then the NYSE-stock component
of the final settlement price shall be based on the next opening prices for NYSE
stocks. (11/01/97)
4342.03 The Final Settlement Day - The final settlement day shall be defined
as the third Friday of the contract month, or if the Dow Jones Industrial
Average(SM) is not published for that day, the first preceding business day for
which the Dow Jones Industrial Average(SM) is scheduled to be published.
(11/01/97)
4347.01 Payment - (See Regulation 1049.04.) (11/01/97)
4348.01 Disclaimer -
CBOT Dow Jones Industrial Average(SM) Index futures and futures options
contracts are not sponsored, endorsed, sold or promoted by Dow Jones. Dow Jones
makes no representation or warranty, express or implied, to the owners of CBOT
Dow Jones Industrial Average(SM) Index futures and futures options contracts or
any member of the public regarding the advisability of trading in CBOT Dow Jones
Industrial Average(SM) Index futures and futures options contracts. Dow Jones'
only relationship to the Exchange is the licensing of certain trademarks and
trade names of Dow Jones and of the Dow Jones Industrial Average(SM) which is
determined, composed and calculated by Dow Jones without regard to the Chicago
Board of Trade or CBOT Dow Jones Industrial Average(SM) Index futures and
futures options contracts. Dow Jones has no obligation to take the needs of the
Chicago Board of Trade or the owners of CBOT Dow Jones Industrial Average(SM)
Index futures and futures options contracts into consideration in determining,
composing or calculating the Dow Jones Industrial Average(SM). Dow Jones is not
responsible for and has not participated in the determination of the timing of,
prices at, or quantities of CBOT Dow Jones Industrial Average(SM) Index futures
and futures options contracts to be listed or in the determination or
calculation of the equation by which CBOT Dow Jones Industrial Average(SM) Index
futures and futures options contracts are to be converted into cash. Dow Jones
has no obligation or liability in connection with the administration, marketing
or trading of the CBOT Dow Jones Industrial Average(SM) Index futures and
futures options contracts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE DOW
JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN AND DOW JONES SHALL
HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. DOW JONES
MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE
CHICAGO BOARD OF TRADE, OWNERS OF CBOT DOW JONES INDUSTRIAL AVERAGE(SM) INDEX
FUTURES AND FUTURES OPTIONS CONTRACTS, OR ANY OTHER PERSON OR ENTITY FROM THE
USE OF THE DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN. DOW
JONES MAKES NO EXPRESS OR IMPLIED
Ch 43 Delivery procedures
-------------------------
WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OR MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE DOW JONES INDUSTRIAL
AVERAGE(SM) OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING,
IN NO EVENT SHALL DOW JONES HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT,
PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF
NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO THIRD PARTY
BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN DOW JONES AND THE
CHICAGO BOARD OF TRADE. (11/01/97)
[Enlarge/Download Table]
=======================================================================================================
Chapter 44
CBOT(R) Dow Jones Industrial Average(SM) Index Futures Options
=======================================================================================================
Ch 44 Trading Conditions.....................................................................
4401.00 Authority....................................................................
4401.01 Application of Regulations...................................................
4402.01 Nature of CBOT Dow Jones Industrial Average(SM) Index Futures Put Options....
4402.02 Nature of Dow Jones Industrial Average(SM) Index Futures Call Options........
4403.01 Trading Unit.................................................................
4404.01 Striking Prices..............................................................
4405.01 Payment of Option Premium....................................................
4406.01 Option Premium Basis.........................................................
4407.01 Exercise of Option...........................................................
4407.02 Automatic Exercise...........................................................
4408.01 Expiration of Option.........................................................
4409.01 Months Traded In.............................................................
4410.01 Trading Hours................................................................
4411.01 Position Limits and Reportable Positions.....................................
4412.01 Margin Requirements..........................................................
4413.01 Last Day of Trading..........................................................
4414.01 Option Premium Fluctuation Limits............................................
4414.02 Trading Halts on Project A.02................................................
4415.01 Disclaimer...................................................................
================================================================================
Chapter 44
CBOT(R) Dow Jones Industrial Average(SM) Index/1/
Futures Options
================================================================================
Ch 44 Trading Conditions
4401.00 Authority - (See Rule 2801.00) (11/01/97)
4401.01 Application of Regulations - Transactions in put and call options on
CBOT Dow Jones Industrial Average(SM) ("DJIA") Index futures contracts shall be
subject to the general rules of the Association as far as applicable and shall
also be subject to the regulations contained in this chapter which are
exclusively applicable to trading in put and call options on CBOT Dow Jones
Industrial Average(SM) Index futures contracts. (See Rule 490.00) (09/01/00)
4402.01 Nature of CBOT Dow Jones Industrial Average(SM) Index Futures Put
Options- The buyer of one (1) CBOT Dow Jones Industrial Average(SM) Index
futures put option may exercise his option at any time prior to expiration
(subject to Regulation 4407.01), to assume a short position in one (1) CBOT Dow
Jones Industrial Average(SM) Index futures contract of a specified contract
month at a striking price set at the time the option was purchased. The seller
of one (1) CBOT Dow Jones Industrial Average(SM) Index futures put option incurs
the obligation of assuming a long position in one (1) CBOT Dow Jones Industrial
Average(SM) Index futures contract of a specified contract month at a striking
price set at the time the option was sold, upon exercise by a put option buyer.
(11/01/97)
4402.02 Nature of Dow Jones Industrial Average(SM) Index Futures Call
Options -The buyer of one (1) CBOT Dow Jones Industrial Average(SM) Index
futures call option may exercise his option at any time prior to expiration
(subject to Regulation 4407.01), to assume a long position in one (1) CBOT Dow
Jones Industrial Average(SM) Index futures contract of a specified contract
month at a striking price set at the time the option was purchased. The seller
of one (1) CBOT Dow Jones Industrial Average(SM) Index futures call option
incurs the obligation of assuming a short position in one (1) CBOT Dow Jones
Industrial Average(SM) Index futures contract of a specified contract month at a
striking price set at the time the option was sold, upon exercise by a call
option buyer. (11/01/97)
4403.01 Trading Unit - One (1) CBOT Dow Jones Industrial Average(SM) Index
futures contract of a specified contract month on the Chicago Board of Trade.
(11/01/97)
4404.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one hundred (100) index points per
CBOT Dow Jones Industrial Average Index futures contract and in integral
multiples of two hundred (200) index points per CBOT Dow Jones Industrial
Average(SM) Index futures contract as follows:
A. At the commencement of trading for quarterly and non-quarterly expirations,
the following strike prices in one hundred point intervals shall be listed:
one with a striking price closest to the previous day's settlement price on
the underlying CBOT Dow Jones Industrial Average Index futures contract and
the next twenty consecutive higher and the next twenty consecutive lower
striking prices closest to the previous day's settlement price. If the
previous day's settlement price is midway between two striking prices, the
closest price shall be the larger of the two. Over time new striking prices
will be added
____________
/1/ "Dow Jones(SM)", "The Dow(SM)", "Dow Jones Industrial Average(SM)", and
"DJIA(SM)" are service marks of Dow Jones & Company, Inc. and have been
licensed for use for certain purposes by the Board of Trade of the City of
Chicago ("CBOT."). The CBOT's futures and futures options contracts based
on the Dow Jones Industrial Average(SM) are not sponsored, endorsed, sold
or promoted by Dow Jones, and Dow Jones makes no representation regarding
the advisability of trading in such product(s).
Ch 44 Trading Conditions
------------------------
to ensure that at least twenty one hundred point striking prices always
exist above and below the previous day's settlement price in the underlying
futures.
B. At the commencement of trading for quarterly and non-quarterly expirations,
the following strike prices in two hundred point intervals shall be listed:
the next twenty consecutive higher and the next twenty consecutive lower
strike prices above and below the strike price band as stipulated in
Regulation 4404.01(A). Over time new striking prices will be added to
ensure that at least twenty striking prices in two hundred point intervals
always exist above and below the strike price band as stipulated in
Regulation 4404.01(A).
C. All new strike prices will be added prior to the opening of trading on the
following business day. The Exchange may modify the procedure for the
introduction of striking prices as it deems appropriate in order to respond
to market conditions. (10/01/99)
4405.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (11/01/97)
4406.01 Option Premium Basis - The premium for CBOT Dow Jones Industrial
Average(SM) Index futures options shall be in multiples of one-half (1/2) of one
index point of a CBOT Dow Jones Industrial Average(SM) Index futures contract
which shall equal $5.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $5.00 in $1.00 increments per option contract.
(11/01/97)
4407.01 Exercise of Option - The buyer of a CBOT Dow Jones Industrial
Average(SM) Index futures option may exercise the option on any business day
prior to expiration by giving notice of exercise to the Clearing Corporation by
6:00 p.m., or by such other time designated by the Board of Directors, on such
day. (12/01/99)
4407.02 Automatic Exercise - Notwithstanding the provisions of Regulation
4407.01, for options with quarterly expirations, all in-the-money2 options shall
be automatically exercised after 6:00 p.m. on the business day following the
last day of trading, unless notice to cancel automatic exercise is given to the
Clearing Corporation. Notwithstanding the provisions of Regulation 4407.01, for
options with non-quarterly expirations, all in-the-money options shall be
automatically exercised after 6:00 p.m. on the last day of trading, unless
notice to cancel automatic exercise is given to the Clearing Corporation.
For options with quarterly expirations, notice to cancel automatic exercise
shall be given to the Clearing Corporation by 6:00 p.m., or by such other time
designated by the Board of Directors, on the business day following the last day
of trading. For options with non-quarterly expirations, notice to cancel
automatic exercise shall be given to the Clearing Corporation by 6:00 p.m., or
by such other time designated by the Board of Directors, on the last day of
trading. (12/01/99)
4408.01 Expiration of Option - Unexercised CBOT Dow Jones Industrial
Average(SM) Index futures options with quarterly expirations shall expire at
7:00 p.m. on the business day following the last day of trading.
Unexercised CBOT Dow Jones Industrial Average(SM) Index futures options with
non-quarterly expirations shall expire at 7:00 p.m. on the last day of trading.
(11/01/97)
4409.01 Months Traded In - The months listed for trading are January through
December at the discretion of the Exchange; provided however, that the Exchange
may determine not to list a contract month. For options that are traded in
months in which CBOT Dow Jones Industrial Average(SM) Index futures are not
traded, the underlying futures contract is the next futures contract that is
nearest to the expiration of the option. For example, the underlying futures
contract for the October or November option contract is the December futures
contract. (01/01/98)
4410.01 Trading Hours - The hours of trading of options on CBOT Dow Jones
Industrial
_______________
/2/ An option is in-the-money if the settlement price of the underlying futures
contract is less in the case of a put, or greater in the case of a call
than the exercise price for the option.
Ch 44 Trading Conditions
------------------------
Average(SM) Index futures contracts shall be determined by the Board.
On the last day of trading in an expiring option the closing time for such
option shall be the same as the underlying futures contract, subject to the
provisions of the second paragraph of Rule 1007.00. On the last day of trading
in an expiring option, the expiring CBOT Dow Jones Industrial Average(SM) Index
futures options shall be closed with a public call, made strike price by strike
price, conducted by such persons as the Regulatory Compliance Committee shall
direct. CBOT Dow Jones Industrial Average(SM) Index futures options shall be
opened and closed for all months and strike prices simultaneously or in such a
manner as the Regulatory Compliance Committee shall direct. (11/01/97)
4411.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(10/01/00)
4412.01 Margin Requirements - (See Regulation 431.05) (11/07/97)
4413.01 Last Day of Trading - For options expiring on the quarterly cycle,
trading shall terminate at the same date and time as the underlying futures
contract. For options that expire in months other than those in the quarterly
cycle, options trading shall terminate on the third Friday of the option
contract month, at the end of the regular trading session. If that day is not an
Exchange business day, options trading shall terminate on the first preceding
business day. (11/01/97)
4414.01 Option Premium Fluctuation Limits - Option premium limits for the CBOT
Dow Jones Industrial Average(SM) Index futures options shall correspond to the
daily trading limit in effect at that time for the underlying futures contract
as specified in Regulation 1008.01F. There shall be no trading in any option
contract during a period in which trading in the underlying future is halted as
specified in Regulation 1008.01F. On the first day of trading, limits shall be
set from the lowest premium of the opening range. (11/01/97)
4414.02 Trading Halts on e-cbot - There shall be no trading in any option
contract during e-cbot trading hours when the CBOT Dow Jones Industrial
Average(SM) Index primary futures contract is limit bid or limit offered at the
e-cbot price limit. (09/01/00)
4415.01 Disclaimer -
CBOT Dow Jones Industrial Average(SM) Index futures and futures options are not
sponsored, endorsed, sold or promoted by Dow Jones. Dow Jones makes no
representation or warranty, express or implied, to the owners of CBOT Dow Jones
Industrial Average(SM) Index futures and futures options contracts or any member
of the public regarding the advisability of trading in CBOT Dow Jones Industrial
Average(SM) Index futures and futures options contracts. Dow Jones' only
relationship to the Exchange is the licensing of certain trademarks and trade
names of Dow Jones and of the Dow Jones Industrial Average(SM) which is
determined, composed and calculated by Dow Jones without regard to the Chicago
Board of Trade or CBOT Dow Jones Industrial Average(SM) Index futures and
futures options contracts. Dow Jones has no obligation to take the needs of the
Chicago Board of Trade or the owners of CBOT Dow Jones Industrial Average(SM)
Index futures and futures options contracts into consideration in determining,
composing or calculating the Dow Jones Industrial Average(SM). Dow Jones is not
responsible for and has not participated in the determination of the timing of,
prices at, or quantities of CBOT Dow Jones Industrial Average(SM) Index futures
and futures options contracts to be listed or in the determination or
calculation of the equation by which CBOT Dow Jones Industrial Average(SM) Index
futures and futures options contracts are to be converted into cash. Dow Jones
has no obligation or liability in connection with the administration, marketing
or trading of CBOT Dow Jones Industrial Average(SM) Index futures and futures
options contracts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE DOW
JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN AND DOW JONES SHALL
HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. DOW JONES
MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE
CHICAGO BOARD OF TRADE, OWNERS OF CBOT DOW JONES INDUSTRIAL AVERAGE(SM) INDEX
FUTURES AND FUTURES OPTIONS CONTRACTS, OR ANY OTHER PERSON OR ENTITY FROM THE
USE OF THE DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN. DOW
JONES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL
WARRANTIES, OR MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH
RESPECT TO THE DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN.
WITHOUT LIMITING ANY OF
Ch 44 Trading Conditions
------------------------
THE FOREGOING, IN NO EVENT SHALL DOW JONES HAVE ANY LIABILITY FOR ANY LOST
PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO
THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN DOW JONES
AND THE CHICAGO BOARD OF TRADE. (11/01/97)
[Enlarge/Download Table]
================================================================================
Chapter 45
Long Term Fannie Mae(R) Benchmark Notes(SM) and Freddie Mac Reference
Notes(SM) (6 Years 6 Months - 10 Years 3 Months)
================================================================================================
Ch 45 Trading Conditions...............................................................
4501.00 Authority...............................................................
4502.01 Application of Regulation...............................................
4503.01 Emergencies, Acts of God, Acts of Government............................
4504.01 Unit of Trading.........................................................
4505.01 Months Traded In........................................................
4506.01 Price Basis.............................................................
4507.01 Hours of Trading........................................................
4508.01 Trading Limits..........................................................
4508.01A Trading Limits..........................................................
4509.01 Last Day of Trading.....................................................
4509.02 Liquidation in the Last Seven Days of Delivery Months...................
4510.01 Margin Requirements.....................................................
4512.12 Position Limits and Reportable Positions................................
4513.01 All-Or-None Orders......................................................
Ch45 Delivery Procedures...............................................................
4536.01 Standards...............................................................
4542.01 Deliveries of Futures Contracts.........................................
4542.02 Wire Failure............................................................
4546.01 Date of Delivery........................................................
4547.01 Delivery Notices........................................................
4548.01 Method of Delivery......................................................
4549.00 Time of Delivery, Payment, Form of Delivery Notice......................
4549.02 Buyer's Report of Eligibility to Receive Delivery.......................
4549.03 Seller's Invoice to Buyers..............................................
4549.04 Payment.................................................................
4549.05 Buyers Banking Notification.............................................
4550.00 Duties of Members.......................................................
4551.01 Office Deliveries Prohibited............................................
4554.00 Failure to Accept Delivery..............................................
Ch45 Regularity of Banks...............................................................
4580.01 Banks...................................................................
================================================================================
Chapter 45
Long Term Fannie Mae(R) Benchmark Notes(SM) and Freddie Mac Reference
Notes(SM) (6 Years 6 Month-10 Years 3 months)
================================================================================
--------------------------------------------------------------------------------
* Note: These contracts are listed for trading by the Association pursuant to
----
Commodity Futures Trading Commission exchange certification procedures.
Ch45 Trading Conditions
4501.00 Authority - (See Rule 1701.00) (04/01/00)
4502.01 Application of Regulation - Futures transactions in Long Term Fannie
Mae(R) Benchmark Notes(SM) and Freddie Mac Reference Notes(SM) shall be
subject to the general rules of the Association as far as applicable and shall
also be subject to the regulations contained in this chapter, which are
exclusively applicable to trading in Long Term Fannie Mae Benchmark Notes and
Freddie Mac Reference Notes. Long Term Fannie Mae Benchmark Notes and Freddie
Mac Reference Notes are listed for trading by the Association pursuant to
Commodity Futures Trading Commission exchange certification procedures.
For the purposes of this chapter, the trading day begins with the commencement
of trading on Project A at 2:15 p.m. (Chicago time) and ends with the close of
regular daytime trading. (04/01/00)
4503.01 Emergencies, Acts of God, Acts of Government - If the delivery or
acceptance or any precondition or requirement of either is prevented by strike,
fire, accident, act of government, act of God or other emergency, the seller or
buyer shall immediately notify the Chairman. If the Chairman determines that
emergency action may be necessary, he shall call a special meeting of the Board
and arrange for the presentation of evidence respecting the emergency condition.
If the Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and its decision
shall be binding upon all parties to the contract. For example, and without
limiting the Board's power, it may extend delivery dates and designate
alternative delivery points in the event of conditions interfering with the
normal operations of approved facilities.
In the event the Board determines that there exists a shortage of deliverable
Fannie Mae Benchmark Notes and/or Freddie Mac Reference Notes, it may, upon a
two-thirds vote under Rule 180.00, take such action as may be in the Board's
sole discretion appear necessary to prevent, correct or alleviate the condition.
Without limiting the foregoing or the authority of the Board under Rule 180.00,
the Board may:
(1) designate as deliverable, callable Fannie Mae Benchmark Notes and Bonds,
and/or Freddie Mac Reference Notes and Bonds otherwise meeting the
specifications and requirements stated in this chapter;
(2) designate as deliverable one or more issues of Fannie Mae Benchmark Notes
and Freddie Mac Reference Notes and/or Fannie Mae Benchmark Bonds and Freddie
Mac Reference Bonds having maturities shorter than six and one-half years, or
longer than ten years three months and otherwise meeting the specifications
and requirements stated in this chapter; and/or
Regularity of Banks
-------------------
(3) determine a cash settlement based on the current cash value of an 6%
coupon rate, six and one-half years to ten years three months Fannie Mae
Benchmark Note and/or Freddie Mac Reference Note, as determined by using the
current market yield curve for Fannie Mae Benchmark Notes and Freddie Mac
Reference Notes on the last day of trading. (04/01/00)
4504.01 Unit of Trading - The unit of trading shall be Fannie Mae Benchmark
Notes or Freddie Mac Reference Notes having a face value at maturity of one
hundred thousand dollars ($100,000) or multiples thereof. (04/01/00)
4505.01 Months Traded In - Trading in Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures may be scheduled in such months as determined
by the Exchange. (04/01/00)
4506.01 Price Basis - Minimum price fluctuations shall be in multiples of one-
half of one thirty-second (1/32) point per 100 points ($15.625 rounded up to the
nearest 1c per contract) except for intermonth spreads for contracts traded by
open outcry only, where minimum price fluctuations shall be in multiples of one-
fourth of one thirty-second point per 100 points ($7.8125 per contract). Par
shall be on the basis of 100 points. Contracts shall not be made on any other
price basis. (04/01/00)
4507.01 Hours of Trading - The hours of trading for future delivery in Long
Term Fannie Mae Benchmark Notes and Freddie Mac Reference Notes shall be
determined by the Board. On the last day of trading in an expiring future, the
closing time for such future shall be 12:00 noon (Chicago time), subject to the
provisions of the second paragraph of Rule 1007.00.
The market shall be opened and closed for all months simultaneously, or in such
other manner as the Regulatory Compliance Committee shall direct. (04/01/00)
4508.01 Trading Limits - (See Regulation 1008.01) (04/01/00)
4508.01A Trading Limits - (See Ruling 1008.01A) (04/01/00)
4509.01 Last Day of Trading - No trades in Long Term Fannie Mae Benchmark Note
and Freddie Mac Reference Note futures deliverable in the current month shall be
made during the last seven business days of that month and any contracts
remaining open must be settled by delivery or as provided in Regulation 4509.02
after trading in such contracts has ceased. (04/01/00)
4509.02 Liquidation in the Last Seven Days of Delivery Month - After trading
in contracts for future delivery in the current delivery month has ceased in
accordance with Regulation 4509.01 of this chapter, outstanding contracts may be
liquidated by the delivery of book-entry Fannie Mae Benchmark Notes or Freddie
Mac Reference Notes (Regulation 4542.01) or by mutual agreement by means of a
bona fide exchange of such current futures for actual Fannie Mae Benchmark Notes
or Bonds and/or Freddie Mac Reference Notes or Bonds or comparable instruments.
Such exchange must, in any event, be made no later than the fifth business day
immediately preceding the last business day of the delivery month. (04/01/00)
4510.01 Margin Requirements - (See Regulation 431.03) (04/01/00)
4512.01 Position Limits and Reportable Positions - (See Regulation 425.01)
(04/01/00)
4513.01 All-Or-None Orders - The minimum threshold established for All-Or-None
orders in Long- Term Fannie Mae(R) Benchmark Notes(SM) and Freddie Mac Reference
Notes(SM) futures and the Long-Term U.S. Treasury Note Futures/Long-Term Fannie
Mae(R) Benchmark Notes(SM) and Freddie Mac Reference Notes(SM) futures spreads
is one hundred contracts. Such orders must be executed in accordance with
Regulation 331.03. (07/01/00)
Delivery Procedures
-------------------
Ch45 Delivery Procedures
4536.01 Standards - The contract grade for delivery on futures contracts made
under these regulations shall be non-callable Fannie Mae Benchmark Notes or non-
callable Freddie Mac Reference Notes which have an original issue size of at
least $3 billion and an original maturity of not more than ten years three
months and which have a remaining maturity of not less than six years six months
as defined below. All notes delivered against a contract must be of the same
issue. For settlement, the time to maturity of a given issue is calculated in
complete quarter year increments (e.g., 8 years, 10 months, 17 days is taken to
be 8 years, 9 months) from the first day of the delivery month. The price at
which a note with this time to maturity and with the same coupon rate as this
issue will yield 6%, according to bond tables prepared by the Financial
Publishing Co. of Boston, Mass., is multiplied by the settlement price to arrive
at the amount at which the short invoices the long.
Fannie Mae Benchmark Notes and Freddie Mac Reference Notes deliverable against
futures contracts under these regulations must have semi-annual fixed coupon
payments.
Interest accrued on the notes shall be charged to the long by the short in
accordance with Department of the Treasury Title 31 CFR Part 306, Subpart E and
appendix to Subpart E.
New issues of Fannie Mae Benchmark Notes and Freddie Mac Reference Notes which
satisfy the standards in this regulation shall be added to the deliverable grade
as they are issued. To be eligible for delivery in the current month, the newly
issued notes must have been issued and settled at least three business days
before the first eligible day for delivery (see 4542.01).
If during the issuance of notes Fannie Mae or Freddie Mac re-opens an existing
issue, thus rendering the existing issue indistinguishable from the newly issued
one, the older issue would be deliverable if it meets the following standards.
The reopening must have an original issue size of at least $3 billion, and meet
the maturity standards of this chapter at the time of the reopening.
The Exchange reserves the right to exclude any new issue from deliverable status
or to further limit outstanding issues from deliverable status. (04/01/00)
4542.01 Deliveries of Futures Contracts - Deliveries against Long Term Fannie
Mae Benchmark Note and Freddie Mac Reference Note futures contracts shall be by
book-entry transfer between accounts of Clearing Members at qualified banks
(Regulation 4580.01) in accordance with Department of Housing and Urban
Development Title 24 CFR Part 81. Delivery must be made no earlier than the
first business day of the month and no later than the last business day of the
month. Notice of intention to deliver shall be given to the Board of Trade
Clearing Corporation by 8:00 p.m. (Chicago time), or by such other time
designated by the Board of Directors, on the second business day preceding
delivery day. In the event the long Clearing Member does not agree with the
terms of the invoice received from the short Clearing Member, the long Clearing
Member must notify the short Clearing Member, and the dispute must be settled by
9:30 a.m. (Chicago time) on delivery day. The short Clearing Member must have
contract grade Fannie Mae Benchmark Notes or Freddie Mac Reference Notes in
place at his bank in acceptable (to his bank) delivery form no later than 10:00
a.m. (Chicago time) on delivery day. The short Clearing Member must notify his
bank (Regulation 4580.01) to transfer contract grade Fannie Mae Benchmark Notes
or Freddie Mac Reference Notes by book-entry to the long Clearing Member's
account at the long Clearing Member's bank on a delivery versus payment basis.
That is, payment shall not be made until the notes are delivered. On delivery
day, the long Clearing Member must make funds available by 7:30 a.m. (Chicago
time) and notify his bank (Regulation 4580.01) to accept contract grade Fannie
Mae Benchmark Notes or Freddie Mac Reference Notes and to remit federal funds to
the short Clearing Member's account at the short Clearing Member's bank
(Regulation 4580.01) in payment for delivery of the notes. Contract grade Fannie
Mae Benchmark Notes or Freddie Mac Reference Notes must be transferred and
payment must be made before 1:00 p.m. (Chicago time) on delivery day. All
deliveries must be assigned by the Clearing Corporation. Where a commission
house as a member of the Clearing Corporation has an interest both long and
short for customers on its own books, it must tender to the Clearing Corporation
such notices of intention to deliver as it received from its customers who are
short.
Delivery Procedures
-------------------
(04/01/00)
4542.02 Wire Failure - In the event that delivery cannot be accomplished
because of a failure of the Federal Reserve wire or because of a failure of
either the long Clearing Member's bank or the short Clearing Member's bank
access to the Federal Reserve wire, delivery shall be made before 9:30 a.m.
(Chicago time) on the next business day on which the Federal Reserve wire is
operable. Interest shall accrue to the long paid by the short beginning on the
day at which the notes were to be originally delivered.
In the event of such failure, both the long and short must provide documented
evidence that the instructions were given to their respective banks in
accordance with Regulations 4542.01 and 4549.04 and that all other provisions of
Regulations 4542.01 and 4549.04 have been complied with. (04/01/00)
4546.01 Date of Delivery - Delivery of Long Term Fannie Mae Benchmark Notes or
Freddie Mac Reference Notes may be made by the short upon any permissible
delivery day of the delivery month the short may select. Delivery of Long Term
Fannie Mae Benchmark Notes and Freddie Mac Reference Notes must be made no later
than the last business day of that month. (04/01/00)
4547.01 Delivery Notices - (See Regulation 1047.01) (04/01/00)
4548.01 Method of Delivery - (See Regulation 1048.01) (04/01/00)
4549.00 Time of Delivery, Payment, Form of Delivery Notice - (See Rule
1049.00) (04/01/00)
4549.02 Buyer's Report of Eligibility to Receive Delivery - (See Regulation
1049.02) (04/01/00)
4549.03 Seller's Invoice to Buyers - Upon determining the buyers obligated to
accept deliveries tendered by issuers of delivery notices, the Clearing House
shall promptly furnish each issuer the names of the buyers obligated to accept
delivery from him and a description of each commodity tendered by him which was
assigned by the Clearing House to each such buyer. Thereupon, sellers (issuers
of delivery notices) shall prepare invoices addressed to their assigned buyers
describing the documents to be delivered to each such buyer. Such invoices shall
show the amount which buyers must pay to sellers in settlement of the actual
deliveries, based on the delivery prices established by the Clearing House, and
adjusted for applicable interest payments. Such invoices shall be delivered to
the Clearing House by 2:00 p.m. (Chicago time), or by such other time designated
by the Board of Directors, on the day of intention except on the last intention
day of the month, where such invoices shall be delivered to the Clearing House
by 3:00 p.m. (Chicago time), or by such other time designated by the Board of
Directors. Upon receipt of such invoices, the Clearing House shall promptly make
them available to buyers to whom they are addressed, by placing them in buyers'
mail boxes provided for that purpose in the Clearing House. (04/01/00)
4549.04 Payment - Payment shall be made in federal funds. The long obligated
to take delivery must take delivery and make payment before 1:00 p.m. (Chicago
time) on the day of delivery, except on banking holidays when delivery must be
taken and payment made before 9:30 a.m. (Chicago time) the next business day.
Adjustments for differences between contract prices and delivery prices
established by the Clearing House shall be made with the Clearing House in
accordance with its by-laws and resolutions. (04/01/00)
4549.05 Buyers Banking Notification - The long Clearing Member shall provide
the short Clearing member by 4:00 p.m. (Chicago time) on the day of intention,
one business day prior to delivery day, with a Banking Notification. The Banking
Notification form will include the following information: the identification
number and name of the long Clearing Member; the delivery date; the notification
number of the delivery assignment; the identification number and name of the
short Clearing Member making delivery; the quantity of the contract being
delivered; the long Clearing Member's bank, account number and specific Federal
Wire instructions for the transfer of Fannie Mae Benchmark Notes or Freddie Mac
Reference Notes. (04/01/00)
4550.00 Duties of Members - (See Rule 1050.00) (04/01/00)
Delivery Procedures
-------------------
4551.01 Office Deliveries Prohibited - (See Regulation 1051.01) (04/01/00)
4554.00 Failure to Accept Delivery - (See Rule 1054.00) (04/01/00)
Regularity of Banks
-------------------
Ch45 Regularity of Banks
4580.01 Banks - For purposes of these regulations relating to trading in Long
Term Fannie Mae Benchmark Notes and Freddie Mac Reference Notes, the word "Bank"
(Regulation 4542.01) shall mean a U.S. commercial bank (either Federal or State
charter) that is a member of the Federal Reserve System and with capital
(capital, surplus and undivided earnings) in excess of one hundred million
dollars ($100,000,000). (04/01/00)
[Enlarge/Download Table]
=================================================================================================================================
Chapter 46A (Standard Options) Long Term Fannie Mae(R) Benchmark Note(SM) and
Freddie Mac Reference Note(SM) Futures Options
=================================================================================================================================
Ch 46A Trading Conditions.............................................................................................
A4601.00 Authority............................................................................................
A4601.01 Application of Regulations...........................................................................
A4602.01 Nature of Long Term Fannie Mae Benchmark Note and Freddie Mac Reference Note Futures Put Options.....
A4602.02 Nature of Long Term Fannie Mae Benchmark Note and Freddie Mac Reference Futures Call Options.........
A4603.01 Trading Unit.........................................................................................
A4604.01 Striking Prices......................................................................................
A4605.01 Payment of Option Premium............................................................................
A4606.01 Option Premium Basis.................................................................................
A4607.01 Exercise of Option...................................................................................
A4607.02 Automatic Exercise...................................................................................
A4608.01 Expiration of Option.................................................................................
A4609.01 Months Traded In.....................................................................................
A4610.01 Trading Hours........................................................................................
A4611.01 Position Limits and Reportable Positions.............................................................
A4612.01 Margin Requirements..................................................................................
A4613.01 Last Day of Trading..................................................................................
A4614.01 Option Premium Fluctuation Limits....................................................................
4601A
================================================================================
(R)Chapter 46A(Standard Options)
Long Term Fannie Mae(R) Benchmark Note(SM) and Freddie Mac Reference Note(SM)
Futures Options
================================================================================
*Note: These contacts are listed for trading by the Association pursuant to
Commodity Futures Trading Commission exchange certification procedures.
Ch46A Trading Conditions
A46601.00 Authority - (See Rule 2801.00) (04/01/00)
A4601.01 Application of Regulations - Transactions in put and call options on
Long Term Fannie Mae(R) Benchmark Note(SM) and Freddie Mac Reference Note(SM)
futures contracts shall be subject to the general rules of the Association as
far as applicable and shall also be subject to the regulations contained in this
chapter which are exclusively applicable to trading in put and call options on
Long Term Fannie Mae Benchmark Note and Freddie Mac Reference Note futures
contracts. (See Rule 490.00.) Options on Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures are listed for trading pursuant to Commodity
Futures Trading Commission exchange certification procedures.
For the purposes of this chapter, the trading day begins with the commencement
of trading on Project A at 2:30 p.m. (Chicago time) and ends with the close of
regular daytime trading. (04/01/00)
A4602.01 Nature of Long Term Fannie Mae Benchmark Note and Freddie Mac
Reference Note Futures Put Options -- The buyer of one (1) Long Term Fannie Mae
Benchmark Note and Freddie Mac Reference Note futures put option may exercise
his option at any time prior to expiration (subject to Regulation A4607.01), to
assume a short position in one (1) Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures contract of a specified contract month at a
striking price set at the time the option was purchased. The seller of one (1)
Long Term Fannie Mae Benchmark Note and Freddie Mac Reference Note futures put
option incurs the obligation of assuming a long position in one (1) Long Term
Fannie Mae Benchmark Note and Freddie Mac Reference Note futures contract of a
specified contract month at a striking price set at the time the option was
sold, upon exercise by a put option buyer. (04/01/00)
A4602.02 Nature of Long Term Fannie Mae Benchmark Note and Freddie Mac
Reference Note Futures Call Options - The buyer of one (1) Long Term Fannie Mae
Benchmark Note and Freddie Mac Reference Note futures call option may exercise
his option at any time prior to expiration (subject to Regulation A4607.01), to
assume a long position in one (1) Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures contract of a specified contract month at a
striking price set at the time the option was purchased. The seller of one (1)
Long Term Fannie Mae Benchmark Note and Freddie Mac Reference Note futures call
option incurs the obligation of assuming a short position in one (1) Long Term
Fannie Mae Benchmark Note and Freddie Mac Reference Note futures contract of a
specified contract month at a striking price set at the time the option was
sold, upon exercise by a call option buyer. (04/01/00)
A4603.01 Trading Unit - One (1) Long Term Fannie Mae Benchmark Note and Freddie
Mac Reference Note futures contract of a specified contract month on the Chicago
Board of Trade. (04/01/00)
A4604.01 Striking Prices - Trading shall be conducted for put and call options
with striking prices in integral multiples of one (1) point per Long Term Fannie
Mae Benchmark Note and Freddie Mac Reference Note futures contract. At the
commencement of trading for such option contracts, the following strike prices
shall be listed: one with a striking price closest to the previous day's
settlement price on the underlying Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures contract, the next fifteen consecutive higher
and the next fifteen consecutive lower striking
Ch46A Trading Conditions
------------------------
prices closest to the previous day's settlement price; and all strike prices
listed for all other option contract months listed at that time. If the previous
day's settlement price is midway between two striking prices, the closest price
shall be the larger of the two. When a sale in the underlying Long Term Fannie
Mae Benchmark Note and Freddie Mac Reference Note futures contract occurs at a
price greater than or equal to the fifteenth largest striking price, a new
striking price one increment higher than the existing striking prices will be
added. When a sale in the underlying Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures contract occurs at a price less than or equal
to the fifteenth smallest striking price, a new striking price one increment
lower than the existing striking prices will be added. When a new strike price
is added for an option contract month, the same strike price will be added to
all options contract months or which that strike price is not already listed.
All new strike prices will be added prior to the opening of trading on the
following business day.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (04/01/00)
A4605.01 Payment of Option Premium - The option premium must be paid in full by
each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (04/01/00)
A4606.01 Option Premium Basis - The premium for Long Term Fannie Mae Benchmark
Note and Freddie Mac Reference Note futures options shall be in multiples of one
sixty-fourth (1/64) of one point ($1,000) of a Long Term Fannie Mae Benchmark
Note and Freddie Mac Reference Note futures contract which shall equal $15.63
per 1/64 and $1,000 per full point.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $15.00 in $1.00 increments per option contract
If options are quoted in volatility terms, the minimum price fluctuation shall
be .10 percent (e.g., 10.0%, 10.1%, 10.2%, etc.). (04/01/00)
A4607.01 Exercise of Option - The buyer of a Long Term Fannie Mae Benchmark
Note and Freddie Mac Reference Note futures option may exercise the option on
any business day prior to expiration by giving notice of exercise to the
Clearing Corporation by 6:00 p.m. (Chicago time), or by such other time
designated by the Board of Directors, on such day. Notwithstanding the
foregoing, the buyer may exercise the option prior to 10:00 a.m. (Chicago time)
on the expiration date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions; and
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. (Chicago time) on the last
day of trading. (04/01/00)
A4607.02 Automatic Exercise - Notwithstanding the provisions of Regulation
4607.01, after the close on the last day of trading, all in-the-money options
shall be automatically exercised, unless notice to cancel automatic exercise is
given to the Clearing Corporation.
Notice to cancel automatic exercise shall be given to the Clearing Corporation
by 6:00 p.m. (Chicago time), or by such other time designated by the Board of
Directors, on the last day of trading, except that such notice may be given to
the Clearing Corporation prior to 10:00 a.m. (Chicago time) on the expiration
date:
i) to correct errors or mistakes made in good faith;
ii) to take appropriate action as the result of unreconciled Exchange option
transactions; and
Ch46A Trading Conditions
------------------------
iii) in exceptional cases involving a customer's inability to communicate to
the member firm exercise instructions or the member firm's inability to
receive such instructions prior to 6:00 p.m. (Chicago time) on the last
day of trading. (04/01/00)
A4608.01 Expiration of Option - Unexercised Long Term Fannie Mae Benchmark Note
and Freddie Mac Reference Note futures options shall expire at 10:00 a.m.
(Chicago time) on the first Saturday following the last day of trading.
(04/01/00)
A4609.01 Months Traded In - Trading in Long Term Fannie Mae Benchmark Note and
Freddie Mac Reference Note futures options may be scheduled in such months as
determined by the Exchange. For options that are traded in months in which Long
Term Fannie Mae Benchmark Note and Freddie Mac Reference Note futures are not
traded, the underlying futures contract is the next futures contract that is
nearest to the expiration of the option. For example, the underlying futures
contract for the October or November option contract is the December futures
contract. (04/01/00)
A4610.01 Trading Hours - The hours of trading of options on Long Term Fannie
Mae Benchmark Note and Freddie Mac Reference Note futures contracts shall be
determined by the Board. On the last day of trading in an expiring option, the
closing time for such option shall be the same as the close of trading of the
Regular Daytime open outcry trading session for the corresponding Long Term
Fannie Mae Benchmark Note and Freddie Mac Reference Note futures contract,
subject to the provisions of the second paragraph of Rule 1007.00. Long Term
Fannie Mae Benchmark Note and Freddie Mac Reference Note futures options shall
be opened and closed for all months and strike prices simultaneously or in such
a manner as the Regulatory Compliance Committee shall direct. (04/01/00)
A4611.01 Position Limits and Reportable Positions - (See Regulation 495.01)
(04/01/00)
A4612.01 Margin Requirements - (See Regulation 431.05) (04/01/00)
A4613.01 Last Day of Trading - No trades in Long Term Fannie Mae Benchmark Note
and Freddie Mac Reference Note futures put and call options expiring in the
current month shall be made after the close of trading of the Regular Daytime
open outcry trading session for the corresponding Long Term Fannie Mae Benchmark
Note and Freddie Mac Reference Note futures contract on the last Friday which
precedes by at least five business days the last business day of the month
preceding the option month./1/ If such Friday is not a business day, or there is
a Friday which is not a business day which precedes by four business days the
last business day of the month preceding the option month, the last day of
trading will be the business day prior to such Friday./1/ (04/01/00)
A4614.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a Long Term Fannie Mae Benchmark Note
and Freddie Mac Reference Note futures option at a premium of more than the
trading limit for the Long Term Fannie Mae Benchmark Note and Freddie Mac
Reference Note futures contract above and below the previous day's settlement
premium for that option as determined by the Clearing Corporation. On the first
day of trading, limits shall be set from the lowest premium of the opening
range. (04/01/00)
________________________
/1/ Starting with the June 2001 listing, the Last Day of Trading will be "the
last Friday which precedes by at least TWO business days the last business day
of the month preceding the option month. If such a Friday is not a business day,
or there is a Friday which is not a business day which precedes by ONE business
day the last business day of the month preceding the option month, the last day
of trading will be the business day prior to such Friday."
[Enlarge/Download Table]
================================================================================================================================
Chapter 48A thru 48G
PCS Catastrophe Insurance Options
================================================================================================================================
Trading Conditions........................................................................................
*A4801.00 Authority................................................................................
*B4801.00 Authority................................................................................
*C4801.00 Authority................................................................................
*D4801.00 Authority................................................................................
*E4801.00 Authority................................................................................
*F4801.00 Authority................................................................................
*G4801.00 Authority................................................................................
*A4801.01 Application of Regulations...............................................................
*B4801.01 Application of Regulations...............................................................
*C4801.01 Application of Regulations...............................................................
*D4801.01 Application of Regulations...............................................................
*E4801.01 Application of Regulations...............................................................
*F4801.01 Application of Regulations...............................................................
*G4801.01 Application of Regulations...............................................................
*A4802.01 Nature of * Catastrophe Insurance Options................................................
*B4802.01 Nature of * Catastrophe Insurance Options................................................
*C4802.01 Nature of * Catastrophe Insurance Options................................................
*D4802.01 Nature of * Catastrophe Insurance Options................................................
*E4802.01 Nature of * Catastrophe Insurance Options................................................
*F4802.01 Nature of * Catastrophe Insurance Options................................................
*G4802.01 Nature of * Catastrophe Insurance Options................................................
A4803.01 Trading Unit.............................................................................
B4803.01 Trading Unit.............................................................................
C4803.01 Trading Unit.............................................................................
D4803.01 Trading Unit.............................................................................
E4803.01 Trading Unit.............................................................................
F4803.01 Trading Unit.............................................................................
G4803.01 Trading Unit.............................................................................
*A4804.01 Striking Prices..........................................................................
*B4804.01 Striking Prices..........................................................................
*C4804.01 Striking Prices..........................................................................
*D4804.01 Striking Prices..........................................................................
*E4804.01 Striking Prices..........................................................................
*F4804.01 Striking Prices..........................................................................
*G4804.01 Striking Prices..........................................................................
*A4805.01 Payment of Option Premium................................................................
*B4805.01 Payment of Option Premium................................................................
*C4805.01 Payment of Option Premium................................................................
*D4805.01 Payment of Option Premium................................................................
*E4805.01 Payment of Option Premium................................................................
*F4805.01 Payment of Option Premium................................................................
*G4805.01 Payment of Option Premium................................................................
*A4806.01 Option Premium Basis.....................................................................
*B4806.01 Option Premium Basis.....................................................................
*C4806.01 Option Premium Basis.....................................................................
*D4806.01 Option Premium Basis.....................................................................
*E4806.01 Option Premium Basis.....................................................................
*F4806.01 Option Premium Basis.....................................................................
*G4806.01 Option Premium Basis.....................................................................
*A4807.01 Exercise of Option.......................................................................
*B4807.01 Exercise of Option.......................................................................
*C4807.01 Exercise of Option.......................................................................
[Enlarge/Download Table]
*D4807.01 Exercise of Option.......................................................................
*E4807.01 Exercise of Option.......................................................................
*F4807.01 Exercise of Option.......................................................................
*G4807.01 Exercise of Option.......................................................................
*A4808.01 Expiration of Option.....................................................................
*B4808.01 Expiration of Option.....................................................................
*C4808.01 Expiration of Option.....................................................................
*D4808.01 Expiration of Option.....................................................................
*E4808.01 Expiration of Option.....................................................................
*F4808.01 Expiration of Option.....................................................................
*G4808.01 Expiration of Option.....................................................................
*A4809.01 Months Traded In.........................................................................
*B4809.01 Months Traded In.........................................................................
*C4809.01 Months Traded In.........................................................................
*D4809.01 Months Traded In.........................................................................
*E4809.01 Months Traded In.........................................................................
*F4809.01 Months Traded In.........................................................................
*G4809.01 Months Traded In.........................................................................
*A4810.01 Trading Hours............................................................................
*B4810.01 Trading Hours............................................................................
*C4810.01 Trading Hours............................................................................
*D4810.01 Trading Hours............................................................................
*E4810.01 Trading Hours............................................................................
*F4810.01 Trading Hours............................................................................
*G4810.01 Trading Hours............................................................................
*A4811.01 Position Limits and Reportable Positions.................................................
*B4811.01 Position Limits and Reportable Positions.................................................
*C4811.01 Position Limits and Reportable Positions.................................................
*D4811.01 Position Limits and Reportable Positions.................................................
*E4811.01 Position Limits and Reportable Positions.................................................
*F4811.01 Position Limits and Reportable Positions.................................................
*G4811.01 Position Limits and Reportable Positions.................................................
*A4812.01 Margin Requirements......................................................................
*B4812.01 Margin Requirements......................................................................
*C4812.01 Margin Requirements......................................................................
*D4812.01 Margin Requirements......................................................................
*E4812.01 Margin Requirements......................................................................
*F4812.01 Margin Requirements......................................................................
*G4812.01 Margin Requirements......................................................................
*A4813.01 Last Day of Trading......................................................................
*B4813.01 Last Day of Trading......................................................................
*C4813.01 Last Day of Trading......................................................................
*D4813.01 Last Day of Trading......................................................................
*E4813.01 Last Day of Trading......................................................................
*F4813.01 Last Day of Trading......................................................................
*G4813.01 Last Day of Trading......................................................................
*A4814.01 Option Premium Fluctuations..............................................................
*B4814.01 Option Premium Fluctuations..............................................................
*C4814.01 Option Premium Fluctuations..............................................................
*D4814.01 Option Premium Fluctuations..............................................................
*E4814.01 Option Premium Fluctuations..............................................................
*F4814.01 Option Premium Fluctuations..............................................................
*G4814.01 Option Premium Fluctuations..............................................................
*A4815.01 Strip Transactions.......................................................................
*B4815.01 Strip Transactions.......................................................................
*C4815.01 Strip Transactions.......................................................................
*D4815.01 Strip Transactions.......................................................................
*E4815.01 Strip Transactions.......................................................................
*F4815.01 Strip Transactions.......................................................................
[Enlarge/Download Table]
*G4815.01 Strip Transactions.......................................................................
A4816.01 Standards................................................................................
B4816.01 Standards................................................................................
C4816.01 Standards................................................................................
D4816.01 Standards................................................................................
E4816.01 Standards................................................................................
F4816.01 Standards................................................................................
G4816.01 Standards................................................................................
*A4817.01 Final Settlement.........................................................................
*B4817.01 Final Settlement.........................................................................
*C4817.01 Final Settlement.........................................................................
*D4817.01 Final Settlement.........................................................................
*E4817.01 Final Settlement.........................................................................
*F4817.01 Final Settlement.........................................................................
*G4817.01 Final Settlement.........................................................................
*A4818.01 Disclaimer...............................................................................
*B4818.01 Disclaimer...............................................................................
*C4818.01 Disclaimer...............................................................................
*D4818.01 Disclaimer...............................................................................
*E4818.01 Disclaimer...............................................................................
*F4818.01 Disclaimer...............................................................................
*G4818.01 Disclaimer...............................................................................
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Chapter 48A thru 48G
PCS Catastrophe Insurance Options
================================================================================
Trading Conditions
NOTE: The following PCS Catastrophe Insurance options are based on PCS indices.
Each PCS index has Small Cap and Large Cap options contracts listed for trading.
The Small Cap options have a maximum index value of 200. The Large Cap options
have a minimum index value of 200 and maximum index value of 500.
* The respective PCS Catastrophe Insurance Option contract regulations are
referenced herein as follows:
-------------------------------------------------
A = National E = Western
-------------------------------------------------
B = Eastern F = Midwestern
-------------------------------------------------
C = Northeastern G = California
-------------------------------------------------
D = Southeastern
-------------------------------------------------
*A4801.00 Authority -
*B4801.00 Authority -
*C4801.00 Authority -
*D4801.00 Authority -
*E4801.00 Authority -
*F4801.00 Authority -
*G4801.00 Authority - (See Rule 2801.00) (11/01/95)
*A4801.01 Application of Regulations -
*B4801.01 Application of Regulations -
*C4801.01 Application of Regulations -
*D4801.01 Application of Regulations -
*E4801.01 Application of Regulations -
*F4801.01 Application of Regulations -
*G4801.01 Application of Regulations - Transactions in * Property Claims
Services (PCS) Catastrophe Insurance put and call options shall be subject to
the general rules of the Association as far as applicable and shall also be
subject to the regulations contained in this chapter which are exclusively
applicable to * Catastrophe Insurance put and call options (See Rule 490.00).
(11/01/95)
*A4802.01 Nature of * Catastrophe Insurance Options -
*B4802.01 Nature of * Catastrophe Insurance Options -
*C4802.01 Nature of * Catastrophe Insurance Options -
*D4802.01 Nature of * Catastrophe Insurance Options -
*E4802.01 Nature of * Catastrophe Insurance Options -
*F4802.01 Nature of * Catastrophe Insurance Options -
*G4802.01 Nature of * Catastrophe Insurance Options - The buyer of one (1) *
Catastrophe Insurance call (put) option may exercise his option only after the
close on the last day of trading and settle
Trading Conditions
------------------
against a * PCS Catastrophe Insurance index at a striking price set at the time
the call (put) option was purchased. The seller of one (1) * Catastrophe
Insurance call (put) option incurs the obligation of settling against a * PCS
Catastrophe Insurance index at a striking price set at the time the option was
sold, upon exercise by a call (put) option buyer. (11/01/95)
A4803.01 Trading Unit - The unit of trading shall be the National Property
Claim Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the fifty states of the United
States divided by $100 million.
The National PCS Catastrophe Insurance Index shall be quoted in points and one
tenth (0.10) of one point. Each point equals $200 and each tenth of one point
equals $20. (12/01/95)
B4803.01 Trading Unit - The unit of trading shall be the Eastern Property Claim
Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the Eastern region of the United
States divided by $100 million.
The Eastern PCS Catastrophe Insurance Index shall be quoted in points and one
tenth (0.10) of one point. Each point equals $200 and each tenth of one point
equals $20. (12/01/95)
C4803.01 Trading Unit - The unit of trading shall be the Northeastern Property
Claim Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the Northeastern region of the
United States divided by $100 million.
The Northeastern PCS Catastrophe Insurance Index shall be quoted in points and
one tenth (0.10) of one point. Each point equals $200 and each tenth of one
point equals $20. (12/01/95)
D4803.01 Trading Unit - The unit of trading shall be the Southeastern Property
Claim Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the Southeastern region of the
United States divided by $100 million.
The Southeastern PCS Catastrophe Insurance Index shall be quoted in points and
one tenth (0.10) of one point. Each point equals $200 and each tenth of one
point equals $20. (12/01/95)
E4803.01 Trading Unit - The unit of trading shall be the Western Property Claim
Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the Western region of the United
States divided by $100 million.
The Western PCS Catastrophe Insurance Index shall be quoted in points and one
tenth (0.10) of one point. Each point equals $200 and each tenth of one point
equals $20. (12/01/95)
F4803.01 Trading Unit - The unit of trading shall be the Midwestern Property
Claim Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in the Midwestern region of the United
States divided by $100 million.
The Midwestern PCS Catastrophe Insurance Index shall be quoted in points and one
tenth (0.10) of one point. Each point equals $200 and each tenth of one point
equals $20. (12/01/95)
G4803.01 Trading Unit - The unit of trading shall be the California Property
Claim Services (PCS) Catastrophe Insurance Index defined as the sum of all PCS
estimates of insured catastrophic losses in California divided by $100 million.
The California PCS Catastrophe Insurance Index shall be quoted in points and one
tenth (0.10) of one point. Each point equals $200 and each tenth of one point
equals $20. (12/01/95)
*A4804.01 Striking Prices -
*B4804.01 Striking Prices -
*C4804.01 Striking Prices -
*D4804.01 Striking Prices -
*E4804.01 Striking Prices -
*F4804.01 Striking Prices -
*G4804.01 Striking Prices - Trading shall be conducted for call options with
striking prices in integral multiples of five points from 0.0 to 195.0 for the
Small Cap call options and from 200.0 to 495.0 for the Large Cap call options.
Trading shall be conducted for put options with striking prices in integral
multiples
Trading Conditions
------------------
of five points from 5.0 to 200.0 for the Small Cap put options and from 205.0 to
500.0 for the Large Cap put options. All strike prices shall be listed for
trading at the commencement of trading for an option contract.
The Exchange may modify the procedure for the introduction of striking prices as
it deems appropriate in order to respond to market conditions. (11/01/95)
*A4805.01 Payment of Option Premium -
*B4805.01 Payment of Option Premium -
*C4805.01 Payment of Option Premium -
*D4805.01 Payment of Option Premium -
*E4805.01 Payment of Option Premium -
*F4805.01 Payment of Option Premium -
*G4805.01 Payment of Option Premium - The option premium must be paid in full
by each clearing member to the Clearing House and by each option customer to his
commission merchant at the time that the option is purchased, or within a
reasonable time after the option is purchased. (11/01/95)
*A4806.01 Option Premium Basis -
*B4806.01 Option Premium Basis -
*C4806.01 Option Premium Basis -
*D4806.01 Option Premium Basis -
*E4806.01 Option Premium Basis -
*F4806.01 Option Premium Basis -
*G4806.01 Option Premium Basis - The premium for * PCS Catastrophe Insurance
options shall be in multiples of 1/10 ($20.00) of one point of the * PCS
Catastrophe Index. (11/01/95)
*A4807.01 Exercise of Option -
*B4807.01 Exercise of Option -
*C4807.01 Exercise of Option -
*D4807.01 Exercise of Option -
*E4807.01 Exercise of Option -
*F4807.01 Exercise of Option -
*G4807.01 Exercise of Option - The buyer of a * PCS Catastrophe Insurance
option may exercise the option only after the close on the last day of trading
by giving notice to the Clearing Corporation by 6:00 p.m., or by such other time
designated by the Board of Directors, on that day. In-the-money1 options shall
be automatically exercised in the absence of contrary instructions delivered to
the Clearing House by 6:00 p.m., or by such other time designated by the Board
of Directors, on the last day of trading. (12/01/99)
*A4808.01 Expiration of Option -
*B4808.01 Expiration of Option -
*C4808.01 Expiration of Option - *D4808.01 Expiration of Option -
*E4808.01 Expiration of Option -
*F4808.01 Expiration of Option -
_______________________
/1/ A call option is in-the-money if the final settlement value of the
underlying PCS index as defined in Regulation 4817.01 is greater
than the exercise price for the call option. A put option is
in-the-money if the final settlement value of the underlying PCS
index as defined in Regulation 4817.01 is less than the exercise
price for the put option.
Trading Conditions
------------------
*G4808.01 Expiration of Option - The expiration date for the * PCS Catastrophe
Insurance options may be specified to be either the last business day of the
sixth calendar month following the loss period or the last business day of the
twelfth calendar month following the loss period. * PCS Catastrophe Insurance
options shall expire at 6:00 p.m. on that specified day. (11/01/95)
*A4809.01 Months Traded In -
*B4809.01 Months Traded In -
*C4809.01 Months Traded In -
*D4809.01 Months Traded In -
*E4809.01 Months Traded In -
*F4809.01 Months Traded In -
*G4809.01 Months Traded In - Trading for quarterly, semi-annual, and annual
option contracts shall be in the current calendar month, and in the following
twenty calendar months, and in the March, June, September, and December cycle
months of a forty-two month period beginning with the first such cycle month
following the last spot month, provided however, that the Board, or a Committee
authorized by the Board, may determine not to list a contract month. (11/01/95)
*A4810.01 Trading Hours -
*B4810.01 Trading Hours -
*C4810.01 Trading Hours -
*D4810.01 Trading Hours -
*E4810.01 Trading Hours -
*F4810.01 Trading Hours -
*G4810.01 Trading Hours - The hours of trading of * PCS Catastrophe Insurance
option contracts shall be determined by the Board. On the last day of trading in
an expiring option, the expiring * PCS Catastrophe Insurance options shall be
closed with a public call strike price by strike price, conducted by such person
as the Regulatory Compliance Committee shall direct. * PCS Catastrophe Insurance
options shall be opened and closed for all months and strike prices
simultaneously or in such a manner as the Regulatory Compliance Committee shall
direct. (11/01/95)
*A4811.01 Position Limits and Reportable Positions -
*B4811.01 Position Limits and Reportable Positions -
*C4811.01 Position Limits and Reportable Positions -
*D4811.01 Position Limits and Reportable Positions -
*E4811.01 Position Limits and Reportable Positions -
*F4811.01 Position Limits and Reportable Positions -
*G4811.01 Position Limits and Reportable Positions - See Regulation 425.01.
(10/01/00)
*A4812.01 Margin Requirements -
*B4812.01 Margin Requirements -
*C4812.01 Margin Requirements -
*D4812.01 Margin Requirements -
*E4812.01 Margin Requirements -
*F4812.01 Margin Requirements -
*G4812.01 Margin Requirements - See Regulation 431.05. (11/01/95)
*A4813.01 Last Day of Trading -
Trading Conditions
------------------
*B4813.01 Last Day of Trading -
*C4813.01 Last Day of Trading -
*D4813.01 Last Day of Trading -
*E4813.01 Last Day of Trading -
*F4813.01 Last Day of Trading -
*G4813.01 Last Day of Trading - The last day of trading in the expiring * PCS
Catastrophe Insurance options shall be the same as the expiration date as
specified in Regulation 4808.01. (11/01/95)
*A4814.01 Option Premium Fluctuations -
*B4814.01 Option Premium Fluctuations -
*C4814.01 Option Premium Fluctuations -
*D4814.01 Option Premium Fluctuations -
*E4814.01 Option Premium Fluctuations -
*F4814.01 Option Premium Fluctuations -
*G4814.01 Option Premium Fluctuations - Trading is prohibited during any day
except for the last day of trading in a * PCS Catastrophe Insurance option at a
premium of more than 10 points for Small Cap options and 20 points for Large Cap
options above and below the previous day's settlement premium for that option as
determined by the Clearing Corporation. On the first day of trading, limits
shall be set forth from the lowest premium of the opening range. (11/01/95)
*A4815.01 Strip Transactions -
*B4815.01 Strip Transactions -
*C4815.01 Strip Transactions -
*D4815.01 Strip Transactions -
*E4815.01 Strip Transactions -
*F4815.01 Strip Transactions -
*G4815.01 Strip Transactions - A * PCS Catastrophe Insurance options strip
transaction involving the simultaneous purchase (or sale) of an equal amount of
options contracts (or options spreads within the same contract month) at the
same strike prices at a differential to the previous settlement prices is
permitted on this Exchange provided:
1. that each month of the strip is for the same account. Provided that,
when an order has been executed in the wrong month, (or strike price)
and the erroneous transaction has been placed in the broker's or
firm's error account, the error may be corrected by a spread
transaction in which one leg of the spread offsets the position in
the error account and the other leg is the correct execution of the
order. Provided further that the liability of the floor broker or FCM
shall be determined in accordance with Regulation 350.04.
2. that all months of the strip are priced at prices within the daily
trading limits specified in Regulation 4814.01.
3. that the strip is offered by public outcry in the pit assigned to *
PCS Catastrophe Insurance options.
4. that the transaction shall be reported, recorded and publicized as a
strip.
5. that when such transactions are executed simultaneously, the
executing member on each side of the transaction shall designate each
part of the trade as a strip on his cards or order by an appropriate
word or symbol clearly identifying each part of such transactions.
Brokers may not couple separate orders and execute them as a strip, nor may a
broker take one part of a strip for his own account and give the other part to a
customer on an order. (11/01/95)
Trading Conditions
------------------
A4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the National PCS
Catastrophe Insurance index are the sum of all PCS estimates of catastrophes
that occur in the fifty states of the United States during a specified loss
period. PCS loss estimates resulting from the catastrophic events identified by
PCS shall be aggregated daily during the loss period and during a subsequent
period of twelve months following the loss period. The PCS loss estimates
included in the calculation of the final settlement value of the index shall be
the latest estimates made available by PCS by the last day of trading of the
National PCS Catastrophe Insurance option, as defined in Regulations A4808.01
and A4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
B4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the Eastern PCS
Catastrophe Insurance index are the sum of all PCS estimates of catastrophes
that occur in the Eastern region of the United States during a specified loss
period. The Eastern region of the United States. The Eastern region of the U.S.
includes all following states: Maine, New Hampshire, Vermont, Massachusetts,
Connecticut, Rhode Island, New York, New Jersey, Pennsylvania, Delaware,
Maryland, West Virginia, Virginia, North Carolina, South Carolina, Georgia,
Florida, Alabama, Mississippi and Louisiana. PCS loss estimates resulting from
the catastrophic events identified by PCS shall be aggregated daily during the
loss period and during a subsequent period of twelve months following the loss
period. The PCS loss estimates included in the calculation of the final
settlement value of the index shall be the latest estimates made available by
PCS by the last day of trading of the Eastern PCS Catastrophe Insurance option,
as defined in Regulations B4808.01 and B4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
C4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the Northeastern PCS
Catastrophe Insurance index are the sum of all PCS estimates for catastrophes
that occur in the Northeastern region of the United States. The Northeastern
region of the U.S. includes all following states: Maine, New Hampshire, Vermont,
Massachusetts, Connecticut, Rhode Island, New York, New Jersey, Pennsylvania,
Delaware, and Maryland. PCS loss estimates resulting from the catastrophic
events identified by PCS shall be aggregated daily during the loss period and
during a subsequent period of twelve months following the loss period. The PCS
loss estimates included in the calculation of the final settlement value of the
index shall be the latest estimates made available by PCS by the last day of
trading of the National PCS Catastrophe Insurance option, as defined in
Regulations C4808.01 and C4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance
Trading Conditions
------------------
companies. (12/01/95)
D4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the Southeastern PCS
Catastrophe Insurance index are the sum of all PCS estimates for catastrophes
that occur in the Southeastern region of the United States. The Southeastern
region of the U.S. includes all following states: Virginia, West Virginia, North
Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi and Louisiana.
PCS loss estimates resulting from the catastrophic events identified by PCS
shall be aggregated daily during the loss period and during a subsequent period
of twelve months following the loss period. The PCS loss estimates included in
the calculation of the final settlement value of the index shall be the latest
estimates made available by PCS by the last day of trading of the Southeastern
PCS Catastrophe Insurance option, as defined in Regulations D4808.01 and
D4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
E4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the Western PCS
Catastrophe Insurance index are the sum of all PCS estimates for catastrophes
that occur in the Western region of the United States. The Western region of the
U.S. includes all following states: Hawaii, Alaska, Washington, Oregon,
California, Nevada, Arizona, New Mexico, Utah, Colorado, Wyoming, Montana, and
Idaho. PCS loss estimates resulting from the catastrophic events identified by
PCS shall be aggregated daily during the loss period and during a subsequent
period of twelve months following the loss period. The PCS loss estimates
included in the calculation of the final settlement value of the index shall be
the latest estimates made available by PCS by the last day of trading of the
Western PCS Catastrophe Insurance option, as defined in Regulations E4808.01 and
E4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
F4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the Midwestern PCS
Catastrophe Insurance index are the sum of all PCS estimates for catastrophes
that occur in the Midwestern region of the United States. The Midwestern region
of the U.S. includes all following states: Oklahoma, Arkansas, Tennessee,
Kentucky, Ohio, Michigan, Indiana, Illinois, Wisconsin, Minnesota, North Dakota,
South Dakota, Iowa, Nebraska, Kansas, and Missouri. PCS loss estimates resulting
from the catastrophic events identified by PCS shall be aggregated daily during
the loss period and during a subsequent period of twelve months following the
loss period. The PCS loss estimates included in the calculation of the final
settlement value of the index shall be the latest estimates made available by
PCS by the last day of trading of the Midwestern PCS Catastrophe Insurance
option, as defined in Regulations F4808.01 and F4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Trading Conditions
------------------
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
G4816.01 Standards - PCS catastrophe loss estimates represent anticipated
insured losses on an industry wide-basis from catastrophic events identified by
Property Claims Service (PCS). The losses included in the California PCS
Catastrophe Insurance index are the sum of all PCS estimates of catastrophes
that occur in California. PCS loss estimates resulting from the catastrophic
events identified by PCS shall be aggregated daily during the loss period and
during a subsequent period of twelve months following the loss period. The PCS
loss estimates included in the calculation of the final settlement value of the
index shall be the latest estimates made available by PCS by the last day of
trading of the California PCS Catastrophe Insurance option, as defined in
Regulations G4808.01 and G4813.01.
The loss period for quarterly option contracts is defined as the contract month
and the two preceding calendar months. The loss period for semi-annual option
contracts is defined as the contract month and the five preceding calendar
months. The loss period for annual option contracts is defined as the contract
month and the eleven preceding calendar months.
Losses and aggregate insured catastrophic losses shall be estimated and
determined by PCS. Such estimates and determinations will be based on the
analysis of surveys conducted by PCS of insurance companies. (12/01/95)
*A4817.01 Final Settlement -
*B4817.01 Final Settlement -
*C4817.01 Final Settlement -
*D4817.01 Final Settlement -
*E4817.01 Final Settlement -
*F4817.01 Final Settlement -
*G4817.01 Final Settlement - The final settlement value for quarterly,
semi-annual and annual Small Cap put and call option contracts shall be based on
the lesser of a) $200 times the final settlement value of the * PCS Catastrophe
Insurance Index or b) $40,000. The Small Cap put and call options shall settle
based on an index value ranging from 0 to 200. For instance, if the index
settles at 180, a 150 call option buyer will receive $200 times (180-150) or
$6,000 per option, while a 150 put option will expire worthless. If the index
reaches the maximum 200 value, a 150 call option buyer will receive $200 times
(200-150) or $10,000 per option, while a 150 put option will expire worthless.
The final settlement value for quarterly, semi-annual and annual Large Cap put
and call options shall be based on the lesser of a) $200 times the final
settlement value of the * PCS Catastrophe Insurance Index or b) $100,000. In
addition, if aggregated industry catastrophic losses amount to an index value of
less than 200, the settlement value for the Large Cap put and call options shall
be based on a minimum index value of 200 or $40,000 per option. The Large Cap
put and call options shall be settled based on an index value ranging between
200 and 500. For instance, if the index settles at 300, the buyer of a 250 call
option will receive $200 times (300-250) or $10,000 per option while a 250 put
option will expire worthless. If the index settles at the minimum value of 200,
the buyer of a 250 put option will receive $200 times (250-200) or $10,000 per
option, while a 250 call option will expire worthless. If the index settles at
the maximum value of 500, the buyer of a 250 call option will receive $200 times
(500-250) or $50,000 per option, while a 250 put option will expire worthless.
The final settlement value of the * PCS Catastrophe Insurance Index shall be
calculated and disseminated soon after the close of trading on the last day of
trading.
The final settlement value of the PCS Catastrophe Insurance Index shall be
rounded to the nearest one tenth of one point ($20) rounded up in case of a tie.
Final settlement against the * PCS Catastrophe Insurance Index must be made
through the Clearing Corporation. Final settlement under these regulations shall
follow the close of trading on the last day of trading, when the final
settlement price is available and shall be accomplished by cash settlement as
Trading Conditions
------------------
hereinafter provided. The Clearing Corporation shall advise clearing member
holding open positions in the * PCS Catastrophe Insurance options deliverable in
the current month of the final settlement price as defined in Regulation
4817.01. Clearing members shall then make payment to and receive payment through
the Clearing Corporation as soon as practical thereafter, based on the final
settlement price. (12/01/95)
*A4818.01 Disclaimer -
*B4818.01 Disclaimer -
*C4818.01 Disclaimer -
*D4818.01 Disclaimer -
*E4818.01 Disclaimer -
*F4818.01 Disclaimer -
*G4818.01 Disclaimer - Preparing an estimate of the insured losses involved in
a catastrophe is an inherently subjective process, involving assessment of
information from a number of sources which may not be complete or accurate.
Moreover, the total insured losses for certain catastrophes may continue to
develop over periods of time which exceed the development period(s) employed in
contracts based on PCS estimates and indexes of such estimates. Neither the
Exchange, AISG, PCS nor persons acting on their behalf, nor persons or entities
providing information for use in preparing the estimates included in the
indexes, guarantees the accuracy and/or completeness of the indexes or any data
included therein, or makes any other warranty, express or implied, as to results
to be obtained by any person or any entity from the use of the estimates or any
component, combination or derivative thereof, including, without limitation, the
indexes or any data included therein, in connection with the trading of futures
an/or options contracts, or for any other use. Neither the Exchange, AISG, PCS
nor person acting on their behalf, nor persons or entities providing information
for use in preparing the estimates included in the indexes, makes any express or
implied warranties of merchantability or fitness for a particular purpose for
use with respect to the estimates or any component, combination or derivative
thereof, including, without limitation, the indexes or any data included
therein. (05/01/97)
[Download Table]
================================================================================
Chapter 51
Corn Yield Insurance Futures
================================================================================
Ch51 Trading Conditions.............................................. 5103
*A5102.01 Application of Regulation............................ 5103
*B5102.01 Application of Regulation............................ 5103
*C5102.01 Application of Regulation............................ 5103
*D5102.01 Application of Regulation............................ 5103
*E5102.01 Application of Regulation............................ 5103
*F5102.01 Application of Regulation............................ 5103
*A5104.01 Unit of Trading...................................... 5103
*B5104.01 Unit of Trading...................................... 5103
*C5104.01 Unit of Trading...................................... 5103
*D5104.01 Unit of Trading...................................... 5103
*E5104.01 Unit of Trading...................................... 5103
F5104.01 Unit of Trading...................................... 5103
*A5105.01 Months Traded In..................................... 5103
*B5105.01 Months Traded In..................................... 5103
*C5105.01 Months Traded In..................................... 5103
*D5105.01 Months Traded In..................................... 5103
*E5105.01 Months Traded In..................................... 5103
*F5105.01 Months Traded In..................................... 5103
*A5106.01 Yield Basis.......................................... 5103
*B5106.01 Yield Basis.......................................... 5103
*C5106.01 Yield Basis.......................................... 5104
*D5106.01 Yield Basis.......................................... 5104
*E5106.01 Yield Basis.......................................... 5104
*F5106.01 Yield Basis.......................................... 5104
*A5107.01 Hours of Trading..................................... 5104
*B5107.01 Hours of Trading..................................... 5104
*C5107.01 Hours of Trading..................................... 5104
*D5107.01 Hours of Trading..................................... 5104
*E5107.01 Hours of Trading..................................... 5104
*F5107.01 Hours of Trading..................................... 5104
*A5108.01 Trading Limits....................................... 5104
*B5108.01 Trading Limits....................................... 5104
*C5108.01 Trading Limits....................................... 5104
*D5108.01 Trading Limits....................................... 5104
*E5108.01 Trading Limits....................................... 5104
*F5108.01 Trading Limits....................................... 5104
*A5109.01 Last Day of Trading.................................. 5104
*B5109.01 Last Day of Trading.................................. 5104
*C5109.01 Last Day of Trading.................................. 5104
*D5109.01 Last Day of Trading.................................. 5104
*E5109.01 Last Day of Trading.................................. 5104
F5109.01 Last Day of Trading.................................. 5104
*A5109.02 Liquidation During the Delivery Month................ 5104
*B5109.02 Liquidation During the Delivery Month................ 5104
*C5109.02 Liquidation During the Delivery Month................ 5104
*D5109.02 Liquidation During the Delivery Month................ 5104
*E5109.02 Liquidation During the Delivery Month................ 5104
*F5109.02 Liquidation During the Delivery Month................ 5104
*A5110.01 Margin Requirements.................................. 5104
*B5110.01 Margin Requirements.................................. 5105
*C5110.01 Margin Requirements.................................. 5105
*D5110.01 Margin Requirements.................................. 5105
[Download Table]
*E5110.01 Margin Requirements.................................. 5105
*F5110.01 Margin Requirements.................................. 5105
*A5112.01 Position Limits and Reportable Positions............. 5105
*B5112.01 Position Limits and Reportable Positions............. 5105
*C5112.01 Position Limits and Reportable Positions............. 5105
*D5112.01 Position Limits and Reportable Positions............. 5105
*E5112.01 Position Limits and Reportable Positions............. 5105
*F5112.01 Position Limits and Reportable Positions............. 5105
Ch51 Settlement Procedures........................................... 5106
*A5136.01 Standards............................................ 5106
*B5136.01 Standards............................................ 5106
*C5136.01 Standards............................................ 5106
*D5136.01 Standards............................................ 5106
*E5136.01 Standards............................................ 5106
*F5136.01 Standards............................................ 5106
*A5138.01 Final Cash Settlement Yield and Value Computation.... 5106
*B5138.01 Final Cash Settlement Yield and Value Computation.... 5106
*C5138.01 Final Cash Settlement Yield and Value Computation.... 5106
*D5138.01 Final Cash Settlement Yield and Value Computation.... 5106
*E5138.01 Final Cash Settlement Yield and Value Computation.... 5106
F5138.01 Final Cash Settlement Yield and Value Computation.... 5106
*A5142.01 Delivery on Futures Contracts........................ 5107
*B5142.01 Delivery on Futures Contracts........................ 5107
*C5142.01 Delivery on Futures Contracts........................ 5107
*D5142.01 Delivery on Futures Contracts........................ 5107
*E5142.01 Delivery on Futures Contracts........................ 5107
*F5142.01 Delivery on Futures Contracts........................ 5107
*A5146.01 Date of Delivery..................................... 5107
*B5146.01 Date of Delivery..................................... 5107
*C5146.01 Date of Delivery..................................... 5107
*D5146.01 Date of Delivery..................................... 5107
*E5146.01 Date of Delivery..................................... 5107
*F5146.01 Date of Delivery..................................... 5107
*A5147.01 Payment.............................................. 5107
*B5147.01 Payment.............................................. 5107
*C5147.01 Payment.............................................. 5107
*D5147.01 Payment.............................................. 5107
*E5147.01 Payment.............................................. 5107
*F5147.01 Payment.............................................. 5107
================================================================================
Chapter 51
Corn Yield Insurance Futures
================================================================================
Ch51 Trading Conditions
NOTE: *The respective Corn Yield Insurance contract regulations are referenced
herein as follows:
-----------------------------------
A = Iowa D = Nebraska
-----------------------------------
B = Illinois E = Ohio
-----------------------------------
C = Indiana F = U.S.
-----------------------------------
*A5102.01 Application of Regulation -
*B5102.01 Application of Regulation -
*C5102.01 Application of Regulation -
*D5102.01 Application of Regulation -
*E5102.01 Application of Regulation -
*F5102.01 Application of Regulation - Futures transactions in * Corn Yield
Insurance contracts shall be subject to the general rules of the Association as
far as applicable and shall also be subject to regulations contained in this
chapter which are exclusively applicable to trading in * Corn Yield Insurance
contracts. (02/01/96)
*A5104.01 Unit of Trading -
*B5104.01 Unit of Trading -
*C5104.01 Unit of Trading -
*D5104.01 Unit of Trading -
*E5104.01 Unit of Trading - The unit of trading shall be $100.00 times the
United States Department of Agriculture's monthly estimate of corn yield for the
state of * as defined in Regulation 5136.01. The * corn yield shall consist of
the ratio of * total corn-for-grain production to *'s total corn-for-grain acres
harvested. (02/01/96)
F5104.01 Unit of Trading - The unit of trading shall be $100.000 times the
United States Department of Agriculture's monthly estimate of corn yield for the
U.S. as defined in Regulation 5136.01. The U.S. corn yield shall consist of the
ratio of U.S. total corn-for-grain production to U.S. total corn-for-grain acres
harvested. (02/01/96)
*A5105.01 Months Traded In -
*B5105.01 Months Traded In -
*C5105.01 Months Traded In -
*D5105.01 Months Traded In -
*E5105.01 Months Traded In -
*F5105.01 Months Traded In - Trading in * Corn Yield Insurance futures is
regularly conducted in September, October, November and January, but may be
permitted in the current month plus any succeeding months. The number of months
to be open at one time shall be at the discretion of the Exchange. (02/01/96)
*A5106.01 Yield Basis -
*B5106.01 Yield Basis -
Ch51 Trading Conditions
-----------------------
*C5106.01 Yield Basis -
*D5106.01 Yield Basis -
*E5106.01 Yield Basis -
*F5106.01 Yield Basis - All contract months of the * Corn Yield Insurance
futures shall be quoted in bushels per acre harvested and multiples of tenths of
a bushel per acre harvested. Each bushel per acre harvested equals $100. The
minimum yield fluctuation shall be one-tenth (0.10) of one bushel per acre
harvested ($10 per contract). Contracts shall not be made on any other yield
basis. (02/01/96)
*A5107.01 Hours of Trading -
*B5107.01 Hours of Trading -
*C5107.01 Hours of Trading -
*D5107.01 Hours of Trading -
*E5107.01 Hours of Trading -
*F5107.01 Hours of Trading - The hours of trading for future delivery in *
Corn Yield Insurance futures shall be determined by the Board. The market shall
be opened and closed for all * Corn Yield Insurance futures simultaneously or in
such other manner as the Regulatory Compliance Committee may direct. On the last
day of trading in an expiring future, a bell shall be rung at 12:00 noon
designating the close of the expiring future. (02/01/96)
*A5108.01 Trading Limits -
*B5108.01 Trading Limits -
*C5108.01 Trading Limits -
*D5108.01 Trading Limits -
*E5108.01 Trading Limits -
*F5108.01 Trading Limits - (See Regulation 1008.01). (02/01/96)
*A5109.01 Last Day of Trading -
*B5109.01 Last Day of Trading -
*C5109.01 Last Day of Trading -
*D5109.01 Last Day of Trading -
*E5109.01 Last Day of Trading - The last day of trading in a particular *
Corn Yield Insurance futures contract month shall be on the last business day of
the month prior to the United States Department of Agriculture's (USDA) release
of the corn crop production estimate report for the state of *. (02/01/96)
F5109.01 Last Day of Trading - The last day of trading in a particular
U.S. Corn Yield Insurance futures contract month shall be on the last business
day of the month prior to the United States Department of Agriculture's (USDA)
release of the corn crop production estimate report for the U.S. (02/01/96)
*A5109.02 Liquidation During the Delivery Month -
*B5109.02 Liquidation During the Delivery Month -
*C5109.02 Liquidation During the Delivery Month -
*D5109.02 Liquidation During the Delivery Month -
*E5109.02 Liquidation During the Delivery Month -
*F5109.02 Liquidation During the Delivery Month - After trading in
contracts for future delivery in the current delivery month has ceased, in
accordance with Regulation 5109.01 of this chapter, outstanding contracts for
such delivery shall be liquidated by cash settlement as prescribed in Regulation
5142.01. (02/01/96)
*A5110.01 Margin Requirements -
Ch51 Trading Conditions
-----------------------
*B5110.01 Margin Requirements -
*C5110.01 Margin Requirements -
*D5110.01 Margin Requirements -
*E5110.01 Margin Requirements -
*F5110.01 Margin Requirements - (See Regulation 431.03). (02/01/96)
*A5112.01 Position Limits and Reportable Positions -
*B5112.01 Position Limits and Reportable Positions -
*C5112.01 Position Limits and Reportable Positions -
*D5112.01 Position Limits and Reportable Positions -
*E5112.01 Position Limits and Reportable Positions -
*F5112.01 Position Limits and Reportable Positions - (See Regulation
425.01). (02/01/96)
Ch51 Settlement Procedures
*A5136.01 Standards -
*B5136.01 Standards -
*C5136.01 Standards -
*D5136.01 Standards -
*E5136.01 Standards - The final settlement amount for monthly contracts
shall be equal to the USDA's estimate of corn-for-grain yield for the state of *
multiplied by $100. The yield for the state of * is expressed by USDA in units
rounded to the nearest bushel and is defined as the number of bushels forecast
to be produced, divided by the number of acres forecast to be harvested. The
January USDA report shall refer to the USDA's final estimate of bushels of corn-
for-grain produced for a particular crop year, the USDA's final estimate of
corn-for-grain acres harvested for a particular crop year, and the USDA's final
estimate of corn-for-grain yield for a particular crop year.
The value of the contract shall be determined by the Chicago Board of Trade.
(02/01/96)
*F5136.01 Standards - The final settlement amount for monthly contracts
shall be equal to the USDA's estimate of corn-for-grain yield for the U.S.
multiplied by $100. The yield for the U.S. is expressed by USDA in units rounded
to the nearest one-tenth (0.10) of one bushel per acre and is defined as the
number of bushels forecast to be produced, divided by the number of acres
forecast to be harvested. The January USDA report shall refer to the USDA's
final estimate of bushels of corn-for-grain produced for a particular crop year,
the USDA's final estimate of corn-for-grain acres harvested for a particular
crop year, and the USDA's final estimate of corn-for-grain yield for a
particular crop year.
The value of the contract shall be determined by the Chicago Board of Trade.
(02/01/96)
*A5138.01 Final Cash Settlement Yield and Value Computation -
*B5138.01 Final Cash Settlement Yield and Value Computation -
*C5138.01 Final Cash Settlement Yield and Value Computation -
*D5138.01 Final Cash Settlement Yield and Value Computation -
*E5138.01 Final Cash Settlement Yield and Value Computation - The final
cash settlement yield and value shall be determined in accordance with the
following procedure:
A. On the day the USDA publicized * corn-for-grain yield data for a current
crop year during any of the months August through November or January,
the Exchange shall post by 5:00 p.m., Central Time, the estimate of *
corn-for-grain yield in units of bushels per acre harvested, rounded to
the nearest whole bushel.
B. The * corn-for-grain yield released by USDA by 5:00 p.m. on days noted
in Regulation 5138.01A., shall be the final quantity reported for
determining cash settlement of the most recently expired contract month.
Any subsequent * corn-for-grain yield revisions published or
disseminated by USDA shall not affect the final cash settlement of the *
Corn Yield Insurance futures.
C. The final cash settlement value shall be equal to the final * corn-for-
grain yield reported by USDA on days noted in Regulation 5138.01A.,
multiplied by $100, rounded up or down to the nearest whole dollar.
(02/01/96)
F5138.01 Final Cash Settlement Yield and Value Computation - The final
cash settlement yield and value shall be determined in accordance with the
following procedure:
A. On the day the USDA publicized U.S. corn-for-grain yield data for a
current crop year during any of the months August through November or
January, the Exchange shall post by 5:00 p.m., Central Time, the
estimate of U.S. corn-for-grain yield in units of one-tenth (0.10) of
one bushel per acre harvested.
B. The U.S. corn-for-grain yield released by USDA by 5:00 p.m. on days
noted in Regulation 5138.01A., shall be the final quantity reported for
determining cash settlement of the most recently expired contract month.
Any subsequent U.S. corn-for-grain yield revisions published or
Ch51 Settlement Procedures
--------------------------
disseminated by USDA shall not affect the final cash settlement of the
U.S. Corn Yield Insurance futures.
C. The final cash settlement value shall be equal to the final U.S. corn-
for-grain yield reported by USDA on days noted in Regulation 5138.01A.,
multiplied by $100, rounded up or down to the nearest whole dollar.
(02/01/96)
*A5142.01 Delivery on Futures Contracts -
*B5142.01 Delivery on Futures Contracts -
*C5142.01 Delivery on Futures Contracts -
*D5142.01 Delivery on Futures Contracts -
*E5142.01 Delivery on Futures Contracts -
*F5142.01 Delivery on Futures Contracts - Delivery against the * Corn Yield
Insurance futures contacts must be made through the Clearing Corporation.
Delivery under these regulations shall be on delivery day and shall be
accomplished by cash settlement as hereinafter provided.
The Clearing Corporation shall advise Clearing Members holding open positions in
the most recently expired * Corn Yield Insurance futures contract of the final
cash settlement yield and value by 7:00 p.m., Central Time, on the same day USDA
releases * corn-for-grain yield estimate. Clearing members shall then make
payment to and receive payment through the Clearing Corporation in accordance
with normal variation settlement procedures as soon as practical thereafter,
based on the final cash settlement yield and value.
(02/01/96)
*A5146.01 Date of Delivery -
*B5146.01 Date of Delivery -
*C5146.01 Date of Delivery -
*D5146.01 Date of Delivery -
*E5146.01 Date of Delivery -
*F5146.01 Date of Delivery - Delivery shall be after 7:00 p.m., Central
Time, on the same day USDA releases the * corn-for-grain yield estimate.
(02/01/96)
*A5147.01 Payment -
*B5147.01 Payment -
*C5147.01 Payment -
*D5147.01 Payment -
*E5147.01 Payment -
*F5147.01 Payment - (See Regulation 1049.01). (02/01/96)
[Enlarge/Download Table]
======================================================================================================================
Chapter 52
Corn Yield Insurance Options
======================================================================================================================
Ch52 Trading Conditions.......................................................................................
*A5201.00 Authority.....................................................................................
*B5201.00 Authority.....................................................................................
*C5201.00 Authority.....................................................................................
*D5201.00 Authority.....................................................................................
*E5201.00 Authority.....................................................................................
*F5201.00 Authority.....................................................................................
*A5201.01 Application of Regulations....................................................................
*B5201.01 Application of Regulations....................................................................
*C5201.01 Application of Regulations....................................................................
*D5201.01 Application of Regulations....................................................................
*E5201.01 Application of Regulations....................................................................
*F5201.01 Application of Regulations....................................................................
*A5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*B5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*C5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*D5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*E5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*F5202.01 Nature of * Corn Yield Insurance Futures Put Options..........................................
*A5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*B5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*C5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*D5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*E5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*F5202.02 Nature of * Corn Yield Insurance Futures Call Options.........................................
*A5203.01 Trading Unit..................................................................................
*B5203.01 Trading Unit..................................................................................
*C5203.01 Trading Unit..................................................................................
*D5203.01 Trading Unit..................................................................................
*E5203.01 Trading Unit..................................................................................
*F5203.01 Trading Unit..................................................................................
*A5204.01 Striking Yields...............................................................................
*B5204.01 Striking Yields...............................................................................
*C5204.01 Striking Yields...............................................................................
*D5204.01 Striking Yields...............................................................................
*E5204.01 Striking Yields...............................................................................
*F5204.01 Striking Yields...............................................................................
*A5205.01 Payment of Option Premium.....................................................................
*B5205.01 Payment of Option Premium.....................................................................
*C5205.01 Payment of Option Premium.....................................................................
*D5205.01 Payment of Option Premium.....................................................................
*E5205.01 Payment of Option Premium.....................................................................
*F5205.01 Payment of Option Premium.....................................................................
*A5206.01 Option Premium Basis..........................................................................
*B5206.01 Option Premium Basis..........................................................................
*C5206.01 Option Premium Basis..........................................................................
*D5206.01 Option Premium Basis..........................................................................
*E5206.01 Option Premium Basis..........................................................................
*F5206.01 Option Premium Basis..........................................................................
*A5207.01 Exercise of Option............................................................................
*B5207.01 Exercise of Option............................................................................
*C5207.01 Exercise of Option............................................................................
*D5207.01 Exercise of Option............................................................................
[Enlarge/Download Table]
*E5207.01 Exercise of Option.............................................................................
*F5207.01 Exercise of Option.............................................................................
*A5208.01 Expiration of Option...........................................................................
*B5208.01 Expiration of Option...........................................................................
*C5208.01 Expiration of Option...........................................................................
*D5208.01 Expiration of Option...........................................................................
*E5208.01 Expiration of Option...........................................................................
*F5208.01 Expiration of Option...........................................................................
*A5209.01 Months Traded In...............................................................................
*B5209.01 Months Traded In...............................................................................
*C5209.01 Months Traded In...............................................................................
*D5209.01 Months Traded In...............................................................................
*E5209.01 Months Traded In...............................................................................
*F5209.01 Months Traded In...............................................................................
*A5210.01 Trading Hours..................................................................................
*B5210.01 Trading Hours..................................................................................
*C5210.01 Trading Hours..................................................................................
*D5210.01 Trading Hours..................................................................................
*E5210.01 Trading Hours..................................................................................
*F5210.01 Trading Hours..................................................................................
*A5211.01 Position Limits................................................................................
*B5211.01 Position Limits................................................................................
*C5211.01 Position Limits................................................................................
*D5211.01 Position Limits................................................................................
*E5211.01 Position Limits................................................................................
*F5211.01 Position Limits................................................................................
*A5212.01 Margin Requirements............................................................................
*B5212.01 Margin Requirements............................................................................
*C5212.01 Margin Requirements............................................................................
*D5212.01 Margin Requirements............................................................................
*E5212.01 Margin Requirements............................................................................
*F5212.01 Margin Requirements............................................................................
*A5213.01 Last Day of Trading............................................................................
*B5213.01 Last Day of Trading............................................................................
*C5213.01 Last Day of Trading............................................................................
*D5213.01 Last Day of Trading............................................................................
*E5213.01 Last Day of Trading............................................................................
*F5213.01 Last Day of Trading............................................................................
*A5214.01 Option Premium Fluctuation Limits..............................................................
*B5214.01 Option Premium Fluctuation Limits..............................................................
*C5214.01 Option Premium Fluctuation Limits..............................................................
*D5214.01 Option Premium Fluctuation Limits..............................................................
*E5214.01 Option Premium Fluctuation Limits..............................................................
*F5214.01 Option Premium Fluctuation Limits..............................................................
================================================================================
Chapter 52
Corn Yield Insurance Options
================================================================================
Ch52 Trading Conditions
NOTE: *The respective Corn Yield Insurance Option contract regulations are
referenced herein as follows:
----------------------------------
A = Iowa D = Nebraska
----------------------------------
B = Illinois E = Ohio
----------------------------------
C = Indiana F = U.S.
----------------------------------
*A5201.00 Authority -
*B5201.00 Authority -
*C5201.00 Authority -
*D5201.00 Authority -
*E5201.00 Authority -
*F5201.00 Authority - (See Rule 2801.00). (02/01/96)
*A5201.01 Application of Regulations -
*B5201.01 Application of Regulations -
*C5201.01 Application of Regulations -
*D5201.01 Application of Regulations -
*E5201.01 Application of Regulations -
*F5201.01 Application of Regulations - Transactions in put and call options on
* Corn Yield Insurance futures contracts shall be subject to the general rules
of the Association as far as applicable and shall also be subject to regulations
contained in this chapter which are exclusively applicable to trading in put and
call options on * Corn Yield Insurance futures contracts (see Rule 490.00).
(02/01/96)
*A5202.01 Nature of * Corn Yield Insurance Futures Put Options -
*B5202.01 Nature of * Corn Yield Insurance Futures Put Options -
*C5202.01 Nature of * Corn Yield Insurance Futures Put Options -
*D5202.01 Nature of * Corn Yield Insurance Futures Put Options -
*E5202.01 Nature of * Corn Yield Insurance Futures Put Options -
*F5202.01 Nature of * Corn Yield Insurance Futures Put Options - The buyer of
one (1) * Corn Yield Insurance futures put option may exercise his option at any
time prior to expiration (subject to Regulation 5207.01), to assume a short
position in one (1) * Corn Yield Insurance futures contract of a specified
contract month at a striking yield set at the time the option was purchased. The
seller of one (1) * Corn Yield Insurance futures put option incurs the
obligation of assuming a long position in one (1) * Corn Yield Insurance futures
contract of a specified contract month at a striking yield set at the time the
option was sold, upon exercise by a put option buyer. (02/01/96)
*A5202.02 Nature of * Corn Yield Insurance Futures Call Options -
*B5202.02 Nature of * Corn Yield Insurance Futures Call Options -
Ch52 Trading Conditions
-----------------------
*C5202.02 Nature of * Corn Yield Insurance Futures Call Options -
*D5202.02 Nature of * Corn Yield Insurance Futures Call Options -
*E5202.02 Nature of * Corn Yield Insurance Futures Call Options -
*F5202.02 Nature of * Corn Yield Insurance Futures Call Options - The buyer of
one (1) * Corn Yield Insurance futures call option may exercise his option at
any time prior to expiration (subject to Regulation 5207.01), to assume a long
position in one (1) * Corn Yield Insurance futures contract of a specified
contract month at a striking yield set at the time the option was purchased.
The seller of one (1) * Corn Yield Insurance futures call option incurs the
obligation of assuming a short position in one (1) * Corn Yield Insurance
futures contract of a specified contract month at a striking yield set at the
time the option was sold, upon exercise by a call option buyer. (02/01/95)
*A5203.01 Trading Unit -
*B5203.01 Trading Unit -
*C5203.01 Trading Unit -
*D5203.01 Trading Unit -
*E5203.01 Trading Unit -
*F5203.01 Trading Unit - One (1) * Corn Yield Insurance futures contract of a
specified contract month on the Chicago Board of Trade. (02/01/96)
*A5204.01 Striking Yields -
*B5204.01 Striking Yields -
*C5204.01 Striking Yields -
*D5204.01 Striking Yields -
*E5204.01 Striking Yields -
*F5204.01 Striking Yields - Trading shall be conducted for put and call options
with striking yields (the "strikes") in five (5) bushel-per-acre-harvested
intervals per * Corn Yield Insurance futures contract (i.e., 120.0, 125.0,
130.0, etc.) and in ten (10) bushel-per-acre-harvested intervals per * Corn
Yield Insurance futures contract (i.e. 140.0, 150.0, 160.0, etc.) as follows:
1. a. At the commencement of trading for an option contract, the following
strike yields shall be listed: the striking yield closest to the previous day's
settlement yield on the underlying * Corn Yield Insurance futures contract, the
next twenty consecutive higher and the next twenty consecutive lower striking
yields closest to the previous day's settlement yield, all in five bushel-per-
acre-harvested intervals (i.e., the initial band). If the previous day's
settlement yield is midway between two striking yields, the closest yield shall
be the larger of the two.
b. In addition, strike yields shall be listed from 20.0 to 200.0 in even
ten bushel-per-acre-harvested intervals (i.e., 20.0, 30.0,..., 200.0) above and
below the range of five bushel-per-acre-harvested strikes.
c. Over time striking yields shall be added as necessary to ensure that at
least forty striking yields above and below the previous day's trading range in
the underlying futures contract (i.e., the minimum band) are listed in five
bushel-per-acre-harvested intervals.
d. No new strikes may be added by these procedures in the month in which an
option expires.
2. a. In ten bushel-per-acre-harvested intervals, all strikes in which the
previous day's delta factors (as determined by the Exchange) for both put and
call options are 0.10 or greater for two consecutive business days shall be
listed for trading. However, no new strikes may be added by this procedure to
an option month unless open positions exist in that contract month.
Ch52 Trading Conditions
-----------------------
b. In five bushel-per-acre-harvested intervals, during the month in which
an option expires, all strikes in which the previous day's delta factors (as
determined by the Exchange) for both put and call options are 0.10 or greater
for two consecutive business days shall be listed for trading.
3. The Exchange may modify the procedure for the introduction of striking
yields as it seems appropriate in order to respond to market conditions.
(02/01/96)
*A5205.01 Payment of Option Premium -
*B5205.01 Payment of Option Premium -
*C5205.01 Payment of Option Premium -
*D5205.01 Payment of Option Premium -
*E5205.01 Payment of Option Premium -
*F5205.01 Payment of Option Premium - The option premium must be paid in full
by each clearing member to the Clearing House and by each option customer to his
commission merchant at the time the option is purchased, or within a reasonable
time after the option is purchased. (02/01/96)
*A5206.01 Option Premium Basis -
*B5206.01 Option Premium Basis -
*C5206.01 Option Premium Basis -
*D5206.01 Option Premium Basis -
*E5206.01 Option Premium Basis -
*F5206.01 Option Premium Basis - The premium for * Corn Yield Insurance futures
options shall be in multiples of one tenth of a bushel per acre harvested ($10
per contract). Contracts shall not be made on any other basis.
However, when both sides of the trade are closing transactions, the option
premium may range from $1.00 to $10.00 in $1.00 increments per option contract.
(02/01/96)
*A5207.01 Exercise of Option -
*B5207.01 Exercise of Option -
*C5207.01 Exercise of Option -
*D5207.01 Exercise of Option -
*E5207.01 Exercise of Option -
*F5207.01 Exercise of Option - The buyer of an * Corn Yield Insurance futures
option may exercise the option on any business day up to and including the day
such option expires by giving notice of exercise to the Clearing Corporation by
6:00 p.m., or by such other time designated by the Board of Directors, on such
day. In-the-money1 options that have not been liquidated or exercised on
expiration date shall be automatically exercised in the absence of contrary
instructions delivered to the Clearing Corporation by 6:00 p.m., or by such
other time designated by the Board of Directors, on expiration date by the
Clearing member representing the option buyer. (12/01/99)
*A5208.01 Expiration of Option -
*B5208.01 Expiration of Option -
*C5208.01 Expiration of Option -
__________________________
/1/ A call option is in-the-money if the final settlement yield of the
underlying futures contract is greater than the exercise yield for the call
option. A put option is in-the-money if the final settlement yield of the
underlying futures contract is less than the exercise yield for the put option.
Ch52 Trading Conditions
-----------------------
*D5208.01 Expiration of Option -
*E5208.01 Expiration of Option -
*F5208.01 Expiration of Option - Unexercised * Corn Yield Insurance futures
options shall expire at 6:00 p.m. (Central time) on the same day in which the
final settlement yield for the underlying futures contract is made publicly
available. (02/01/96)
*A5209.01 Months Traded In -
*B5209.01 Months Traded In -
*C5209.01 Months Traded In -
*D5209.01 Months Traded In -
*E5209.01 Months Traded In -
*F5209.01 Months Traded In - Trading may be conducted in * Corn Yield Insurance
futures options in the same months that are listed for trading in the * Corn
Yield Insurance futures contracts, provided however that the Exchange may
determine not to list a contract month. There shall be no trading in * Corn
Yield Insurance futures options for months in which the * Corn Yield Insurance
futures are not traded on the Chicago Board of Trade. (02/01/96)
*A5210.01 Trading Hours -
*B5210.01 Trading Hours -
*C5210.01 Trading Hours -
*D5210.01 Trading Hours -
*E5210.01 Trading Hours -
*F5210.01 Trading Hours - The hours of trading options on * Corn Yield
Insurance futures shall be determined by the Board. On the last day of trading
in an expiring option, the closing time for such options shall be 12:00 noon,
subject to the provisions of the second paragraph of Rule 1007.00. On the last
day of trading in an expiring option, the expiring * Corn Yield Insurance
futures options shall be closed with a public call made striking yield by
striking yield, conducted by such persons as the Regulatory Compliance Committee
shall direct. On all other days, * Corn Yield Insurance futures options shall be
opened and closed for all months and striking yields simultaneously or in such a
manner as the Regulatory Compliance Committee shall direct. (02/01/96)
*A5211.01 Position Limits -
*B5211.01 Position Limits -
*C5211.01 Position Limits -
*D5211.01 Position Limits -
*E5211.01 Position Limits -
*F5211.01 Position Limits - (See Regulation 425.01). (10/01/00)
*A5212.01 Margin Requirements -
*B5212.01 Margin Requirements -
*C5212.01 Margin Requirements -
*D5212.01 Margin Requirements -
*E5212.01 Margin Requirements -
*F5212.01 Margin Requirements - (See Regulation 431.05). (02/01/96)
*A5213.01 Last Day of Trading -
*B5213.01 Last Day of Trading -
Ch52 Trading Conditions
-----------------------
*C5213.01 Last Day of Trading -
*D5213.01 Last Day of Trading -
*E5213.01 Last Day of Trading - No trades in * Corn Yield Insurance futures
options expiring in the current month shall be made after 12:00 noon on the last
business day of the month prior to the United States Department of Agriculture's
(USDA) release of the corn crop production estimate report for the state of *.
(02/01/96)
*F5213.01 Last Day of Trading - No trades in U.S. Corn Yield Insurance futures
options expiring in the current month shall be made after 12:00 noon on the last
business day of the month prior to the United States Department of Agriculture's
(USDA) release of the corn crop production estimate report for the U.S.
(02/01/96)
*A5214.01 Option Premium Fluctuation Limits -
*B5214.01 Option Premium Fluctuation Limits -
*C5214.01 Option Premium Fluctuation Limits -
*D5214.01 Option Premium Fluctuation Limits -
*E5214.01 Option Premium Fluctuation Limits -
*F5214.01 Option Premium Fluctuation Limits - Trading is prohibited during any
day except for the last day of trading in a * Corn Yield Insurance futures
options at a premium of more than the trading limit for the * Corn Yield
Insurance futures contract above and below the previous day's settlement premium
for that option as determined by the Clearing Corporation. On the first day of
trading, limits shall be set from the lowest premium of the opening range.
(02/01/96)
[Download Table]
================================================================================
Chapter 53
CBOT(R) Dow Jones Composite Average(SM) Index Futures
================================================================================
Ch 53 Trading Conditions............................................
5301.00 Authority.............................................
5302.01 Application of Regulation.............................
5303.01 Emergencies, Acts of God, Acts of Government..........
5304.01 Unit of Trading.......................................
5305.01 Months Traded In......................................
5306.01 Price Basis...........................................
5307.01 Hours of Trading......................................
5308.01 Price Limits and Trading Halts........................
5309.01 Last Day of Trading...................................
5309.02 Liquidation During the Delivery Month.................
5310.01 Margin Requirements...................................
5312.01 Position Limits and Reportable Positions..............
Ch 53 Delivery Procedures...........................................
5336.01 Standards.............................................
5342.01 Delivery on Futures Contracts.........................
5342.02 Final Settlement Price................................
5342.03 The Final Settlement Day..............................
5347.01 Payment...............................................
5348.01 Disclaimer............................................
================================================================================
Chapter 53
CBOT(R) Dow Jones Composite Average(SM) Index/1/
Futures
================================================================================
Ch 53 Trading Conditions
5301.00 Authority - (See Regulation 1701.00.) (08/01/00)
5302.01 Application of Regulation - Futures transactions in CBOT(R) Dow Jones
Composite Average(SM) Index contracts shall be subject to the general
rules of the Association as far as applicable and shall also be
subject to the regulations contained in this chapter, which are
exclusively applicable to trading in CBOT(R) Dow Jones Composite
Average(SM) Index contracts. (08/01/00)
5303.01 Emergencies, Acts of God, Acts of Government If the delivery or
acceptance or any precondition or requirement of either, is prevented
by strike, fire, accident, act of government, act of God or other
emergency, the seller or buyer shall immediately notify the Chairman.
If the Chairman determines that emergency action may be necessary, he
shall call a special meeting of the Board and arrange for the
presentation of evidence respecting the emergency condition. If the
Board determines that an emergency exists, it shall take such action
under Rule 180.00 as it deems necessary under the circumstances and
its decision shall be binding upon all parties to the contract.
(08/01/00)
5304.01 Unit of Trading The unit of trading shall be $20.00 times the Dow
Jones Composite Average(SM) Index.. The Dow Jones Composite
Average(SM) Index is a market capitalization-weighted index consisting
of 65 blue-chip stocks. (08/01/00)
________________________
/1/ "Dow Jones", "Dow Jones Composite Average" and "DJCA" are service marks
of Dow Jones & Company, Inc. and have been licensed for use for certain purposes
by the Board of Trade of the City of Chicago (CBOT(R)). The CBOT's futures and
futures options contracts based on the Dow Jones Composite Average are not
sponsored, endorsed, sold or promoted by Dow Jones, and Dow Jones makes no
representation regarding the advisability of trading in such product(s).
Ch 53 Trading Conditions
------------------------
5305.01 Months Traded In - The months listed for trading are March, June,
September and December, at the discretion of the Exchange. (08/01/00)
5306.01 Price Basis - The price of the CBOT(R) Dow Jones Composite Average(SM)
Index futures shall be quoted in points and 1/2 points. One point
equals $20.00 and one-half of one point equals $10.00. The minimum
price fluctuation shall be one-half of one point per contract.
Contracts shall not be made on any other price basis. (08/01/00)
5307.01 Hours of Trading - The hours of trading for future delivery in CBOT(R)
Dow Jones Composite Average(SM) Index futures shall be determined by
the Board. (08/01/00)
The market shall be opened and closed for all months simultaneously,
or in such other manner as the Regulatory Compliance Committee shall
direct. (08/01/00)
5308.01 Price Limits and Trading Halts - (See Regulation 1008.01.) (08/01/00)
5309.01 Last Day of Trading - The last day of trading in CBOT(R) Dow Composite
AverageSM Index futures contracts deliverable in the current delivery
month shall be the trading day immediately preceding the final
settlement day (as described in Regulation 4542.03). (08/01/00)
5309.02 Liquidation During the Delivery Month - After trading in contracts for
future delivery in the current delivery month has ceased, in
accordance with Regulation 4509.01 of this chapter, outstanding
contracts for such delivery shall be liquidated by cash settlement as
prescribed in Regulation 4542.01. (08/01/00)
5310.01 Margin Requirements - (See Regulation 431.03.) (08/01/00)
5312.01 Position Limits and Reportable Positions - (See Regulation 425.01.)
(08/01/00)
Ch 53 Delivery Procedures
5336.01 Standards - The contract grade shall be the final settlement price (as
described in Regulation 4542.02) of the Dow Jones Composite AverageSM
Index on final settlement day (as described in Regulation 4542.03).
(08/01/00)
5342.01 Delivery on Futures Contracts - Delivery against the CBOT(R) Dow Jones
Composite Average(SM) Index futures contract must be made through the
Clearing Corporation. Delivery under these regulations shall be on the
final settlement day (as described in regulation 4542.03) and shall be
accomplished by cash settlement as hereinafter provided.
Clearing members holding open positions in a CBOT(R) Dow Jones
Composite Average(SM) Index futures contract at the time of
termination of trading shall make payment to and receive payment
through the Clearing Corporation in accordance with normal variation
settlement procedures based on a settlement price equal to the final
settlement price (as described in Regulation 4542.02). (08/01/00)
5342.02 Final Settlement Price - The final settlement price shall be
determined on the final settlement day. The final settlement price
shall be $20 times a Special Open Quotation (SOQ) of the Dow Jones
Composite Average(SM) Index based on the opening prices of the
component stocks in the index, or on the last sale price of a stock
that does not open for trading on the regularly scheduled day of final
settlement (as described in Regulation 4542.03).
If the designated primary market for a component stock does not open
on the day scheduled for the determination of the final settlement
price, then the final settlement price shall be based on the next
opening price for the component stock.
If a component stock does not trade on the day scheduled for
determination of the final settlement price while the primary market
for the stock is open for trading, the last sale price of the stock
will be used to calculate the final settlement price. (08/01/00)
5342.03 The Final Settlement Day - The final settlement day shall be defined
as the third Friday of the contract month, or if the Dow Jones
Composite Average(SM) is not scheduled to be published for that day,
the first preceding business day for which the Dow Jones Composite
Average(SM) is scheduled to be published. (08/01/00)
5347.01 Payment - (See Regulation 1049.04.) (08/01/00)
5348.01 Disclaimer
CBOT(R) Dow Jones Composite Average(SM) Index futures and futures
options are not sponsored, endorsed, sold or promoted by Dow Jones.
Dow Jones makes no representation or warranty, express or implied, to
the owners of CBOT(R) Dow Jones Composite Average(SM) Index futures
and futures options contracts or any member of the public regarding
the advisability of trading in CBOT(R) Dow Jones Composite Average(SM)
Index futures and futures options contracts. Dow Jones' only
relationship to the Exchange is the licensing of certain trademarks
and trade names of Dow Jones and of the Dow Jones Composite
Average(SM) which is determined, composed and calculated by Dow Jones
without regard to the Chicago Board of Trade or CBOT(R) Dow Jones
Composite Average(SM) Index futures and futures options contracts, Dow
Jones has no obligation to take the needs of the Chicago Board of
Trade or the owners of CBOT(R) Dow Jones Composite Average(SM) Index
futures and futures options contracts into consideration in
determining, composing or calculating the Dow Jones
CH 53 Delivery Procedures
-------------------------
Composite Average(SM). Dow Jones is not responsible for and has not
participated in the determination of the timing of, prices at, or
quantities of CBOT(R) Dow Jones Composite Average(SM) Index futures
and futures options contracts to be listed or in the determination or
calculation of the equation by which CBOT(R) Dow Jones Composite
Average(SM) Index futures and futures options contracts are to be
converted into cash. Dow Jones has no obligation or liability in
connection with the administration, marketing or trading of CBOT(R)
Dow Jones Composite Average(SM) Index futures and futures options
contracts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF
THE DOW JONES COMPOSITE AVERAGE(SM) OR ANY DATA INCLUDED THEREIN AND
DOW JONES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR
INTERRUPTIONS THEREIN. DOW JONES MAKES NO WARRANTY, EXPRESS OR
IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE CHICAGO BOARD OF TRADE,
OWNERS OF CBOT(R) DOW JONES COMPOSITE AVERAGE(SM) INDEX FUTURES AND
FUTURES OPTIONS CONTRACTS, OR ANY OTHER PERSON OR ENTITY FROM THE USE
OF THE DOW JONES COMPOSITE AVERAGE(SM) OR ANY DATA INCLUDED THEREIN.
DOW JONES MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY
DISCLAIMS ALL WARRANTIES, OR MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE WITH RESPECT TO THE DOW JONES COMPOSITE
AVERAGE(SM) OR ANY DATA INCLUDED THEREIN, WITHOUT LIMITING ANY OF THE
FOREGOING, IN NO EVENT SHALL DOW JONES HAVE ANY LIABILITY FOR ANY LOST
PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES
(INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH
DAMAGES. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR
ARRANGEMENTS BETWEEN DOW JONES AND THE CHICAGO BOARD OF TRADE. BOARD
OF TRADE. (08/01/00)
Appendix Summary
------------
APPENDIX
------------
Appendix Summmary
APPENDIX SUMMARY
1. Reserved
2. Summary of Membership Privileges
3. Exchange Floor Operations and Procedures
A. Guidelines for Guests and Visitors While on the Exchange Floor of
the Chicago Board of Trade
B. Instructions for Floor Clerk Access to the Floor of the Board of
Trade of the City of Chicago
C. Dress Code
D. Pit Openings and Closings
E. Contract Month Symbols
F. Reserved
G. Guidelines - Badge Validation and Return
4. Futures Commission Merchants
A. Reserved
B. Reserved
C. Minimum Financial Requirements - Non-FCM Member Firms
D. Reserved
E. Financial Requirements for Agricultural Regularity
5. Reserved
6. Arbitration Fees
A. Member Claims
B. Non-Member Claims
7. Reserved
8. Reserved
9. Reserved
10. Grains
A. Regular Warehousemen - Chicago and Burns Harbor Switching Districts
B. Regular Warehousemen - St. Louis-East St. Louis and Alton Switching
Districts
C. Regular Warehousemen - Minneapolis and St. Paul Switching Districts
D. Regular Warehousemen - Toledo, Ohio Switching District
E. Storage Rates
F. Reciprocal Switching Charges within Chicago, IL and Burns Harbor, IN
G. Grain Load-Out Procedures
10C(A) Corn and Soybean Shipping Stations
10S(A) Soybean Only Shipping Stations
11. Soybean Oil
A. Regular Shippers
B. Differentials
12. Soybean Meal
A. Regular Shippers
B. Differentials
13. Reserved
14. Silver
A. Approved Brands
B. Regular Vaults
C. Regular New York Vaults
D. Storage Rates
E. Official Assayers
15. Gold
A. Approved Brands
B. Regular Vaults
C. Storage Rates
D. Official Assayers
E. Approved Sources & Vaults
16. Reserved
17. Government National Mortgage Association (GNMA) Collateralized Depositary
Receipt (CDR)
A. Approved Depositaries
B. Approved Originators
18. Reserved
19. Pricing Brokers/Bond Buyer Municipal Bond Index
20-36. Reserved
37. Rough Rice
A. Mill Site Warehouses
B. Rough Rice Regular Warehouses Delivery Differentials
C. Definitions
D. Minimum Financial Requirements for Rough Rice Regularity
39-46. Reserved
APPENDIX 2
[Enlarge/Download Table]
COMMITTEE CBOT TRADING DISSOLUTION
VOTE APPOINTMENTS PRIVILEGES RIGHTS
------------------------------------------------------------------------------------------------------------
FULL Yes Yes Yes Yes
------------------------------------------------------------------------------------------------------------
AM Yes Yes No 1/6 of Full
(1/6) Members Share
------------------------------------------------------------------------------------------------------------
COM None As Advisor No .005 of Full
Members Share
------------------------------------------------------------------------------------------------------------
GIM None As Advisor No .11 of Full
Members Share
------------------------------------------------------------------------------------------------------------
IDEM None As Advisor No .005 of Full
Members Share
------------------------------------------------------------------------------------------------------------
DELEGATES None Member of specified No None
committees; Advisor
on others
------------------------------------------------------------------------------------------------------------
[Enlarge/Download Table]
TRADING PRIVILEGES COMMUNICATIONS FROM EXCHANGE FLOOR
----------------------------------------------------------------------------------------------------------------------
FULL All CBOT (& CBOE) Contracts Allowed in all contracts
----------------------------------------------------------------------------------------------------------------------
AM All Existing & Prospective Futures & Allowed only in contracts for which Trading
Option Contracts in Government Privileges are specified
Instruments Mkt., Index, Debt & Energy
Mkt., & Comm. Options Mkt.
----------------------------------------------------------------------------------------------------------------------
COM All Options Contracts listed on the Allowed only in contracts for which Trading
Exchange Privileges are specified
----------------------------------------------------------------------------------------------------------------------
GIM U.S. T-Bond, U.S. T-Note (6-10 yr.), (5 Allowed only in contracts for which Trading
yr.), (2 yr.), & Agency Note (Long-Term) Privileges are specified
futures
----------------------------------------------------------------------------------------------------------------------
IDEM 30-Day Fed Funds, CBOT(R) DJIASM Index, Allowed only in contracts for which Trading
DJTASM Index, DJUASM Index, DJCASM Index Privileges are specified
Muni Bond Index & Gold futures
----------------------------------------------------------------------------------------------------------------------
DELEGATES Those contracts authorized for the In those contracts authorized for the Membership
specific Membership or Membership or Interest delegated
Interest.
----------------------------------------------------------------------------------------------------------------------
Appendix 2
CBOT(R)TRADING PRIVILEGE SUMMARY
--------------------------------
(as of 08-01-00)
FULL MEMBERSHIP
---------------
- All futures & options.
ASSOCIATE MEMBERSHIP
--------------------
- Treasury Bond, Long-Term Treasury Note, Medium-Term Treasury Note,
Short Term Treasury Note, Long-Term Agency Note, Municipal Bond Index
and CBOT(R) DJIA(SM) futures and options.
- 30-Day Fed Fund, Gold, CBOT(R)DJTA(SM), DJUA(SM) and DJCA(SM) futures;
- Corn, Catastrophe Insurance, Corn Yield Insurance, Oat, Rough Rice,
Soybean, Soybean Meal, Soybean Oil, Silver and Wheat options;
- Corn Yield Insurance and Silver futures (to 12-31-00);
GIM MEMBERSHIP INTEREST
-----------------------
- Treasury Bond, Long-Term Treasury Note, Medium-Term Treasury Note,
Short Term Treasury Note and Long-Term Agency Note futures;
- Corn Yield Insurance futures (to 12-31-00);
- CBOT(R)DJIASM futures & options (to 12-31-00);
- CBOT(R) DJTA(SM), DJUA(SM) and DJCA(SM) futures (to 12-31-00).
IDEM MEMBERSHIP INTEREST
------------------------
- 30-Day Fed Fund, Municipal Bond Index, Gold, CBOT(R)DJIA(SM), DJTA(SM),
DJUA(SM), and DJCA(SM) futures;
- Short-Term Treasury Note futures and options (pit trading only) (to
12-31-00);
- Catastrophe Insurance options (to 12-31-00);
- Silver futures & options (to 12-31-00);
- Corn Yield Insurance futures & options (12-31-00);
- Municipal Bond Index options (pit trading only) (to 12-31-00).
- CBOT(R)DJIASM options (to 12-31-00)
COM MEMBERSHIP INTEREST
-----------------------
- Treasury Bond, Long-Term Treasury Note, Medium-Term Treasury Note, Short
Term Treasury Note, Long-Term Agency Note, Municipal Bond Index, CBOT(R)
DJIA(SM), Corn, Catastrophe Insurance, Corn Yield Insurance, Oat, Rough
Rice, Soybean, Soybean Meal, Soybean Oil, Silver and Wheat options;
- Corn Yield Insurance futures (to 12-31-00);
- Futures underlying Flexible Treasury Options (only in futures/options
spreads in a single transaction) (to 12-31-00).
- CBOT(R)DJIA(SM), DJTA(SM), DJUA(SM), and DJCA(SM) futures (to 12-31-00)
Appendix 3A
APPENDIX 3A - GUIDELINES FOR GUESTS AND VISITORS WHILE ON THE EXCHANGE FLOOR OF
THE CHICAGO BOARD OF TRADE
1. Bringing guests on the Exchange Floor is a privilege extended to all
members who comply with the Rules pertaining thereto.
2. Guests shall be admitted to the Exchange Floor between 1/2 hour before the
opening on each Floor and 1/2 hour after the close on each Floor.
3. No more than 50 guests shall be allowed on the Exchange Floor at any one
time during trading hours.
4. A member may reserve a time for five guests, which reservation will be held
no longer than ten minutes. Such reservation privileges will be denied if
they are abused.
5. Guests must be accompanied by a member at all times. Both the guest and the
host member will sign on to and off of the Floor. The guest will wear, on
visible display, a guest badge. The member will be responsible for the
guest's conduct on the Floor.
6. A) A guest may remain on the Floor for a period of 30 minutes; if he
has not signed out, he will be paged. It will be the member's
responsibility to see that the guest leaves the Floor within five minutes
of being paged and that the guest returns the badge to the Service Desk on
the 4th Floor. Failure to return the guest badge immediately will subject
the member to a minimum fine of twenty-five dollars.
B) At the end of the initial 30 minutes, a guest may ask to extend
his visit for (a) subsequent period(s) of 30 minutes, although such
extension(s) will not be granted if there are more than 50 guests on the
Floor at any one time.
C) If necessary, an All Day Guest Pass may be obtained for a foreign
visitor, firm executive, firm branch employee, customer or consultant (and
other persons with the approval of the Floor Conduct Committee Chairman) by
completing a short application form at the fourth floor Service Desk.
Except for the 30-minute time limit, the same guidelines apply to All Day
Guests, including the requirement that they be accompanied at all times by
a member.
7. No privileges other than admittance to the Floor any be extended to a
guest. A guest is specifically prohibited from performing any functions of
an employee of a member or of a member firm. Entering a trading pit, using
a telephone, using the market display equipment and blocking the area are
also prohibited.
8. Guests of management for business purposes only shall be allowed in the
Exchange Floor.
9. The President of the Exchange may issue special permits beyond the above
limit (five individuals) when he deems it in the interest of the Exchange
to do so. On a case-by-case basis, he may schedule admission to the Floor
for small groups who have made appropriate arrangements.
(Tour Groups: can be no larger than 12, can visit between the hours of
10:30 a.m. and 12:15 p.m., must be escorted at all times, are limited to 15
minutes per tour, will be limited to no more than two groups on the Floor
at any one time, and all such groups must be coordinated through the
Communications Department.)
10. No other guests of staff members may be allowed on the Exchange Floor.
11. Members shall accompany guests in the Member's cafeteria.
12. No guests may be allowed on the Exchange Floor more than five times in one
month.
13. No guest may be allowed on the Exchange Floor who is under twelve years of
age.
14. Members who violate and/or allow their guest(s) to violate any of these
guidelines may be denied visitor's privileges for a period of up to six
months and/or fined appropriately.
APPENDIX 3B - INSTRUCTIONS FOR FLOOR CLERK ACCESS TO THE FLOOR OF THE BOARD OF
TRADE OF THE CITY OF CHICAGO
Please be advised that access to the Floor of the Board of Trade of the
City of Chicago (hereinafter referred to as the Exchange) is a right of
membership. Associate Members and GIM, IDEM and COM Membership Interest Holders
have floor access rights only with respect to specified contracts (See Rules
211.00, 291.00, 292.00 and 293.00). Any and all access by non-members is solely
a privilege extended by the membership for the strictly limited purposes
outlined below. Any violation of any of these instructions shall be just cause
for the revocation of the privilege.
Functions and Responsibilities of Floor Clerks on the Exchange Floor:
A. Floor Clerks and Trainee-Floor Clerks may perform only the following duties
and no others while on the Floor of the Exchange:
1. Receive messages (including trading cards and written orders)
from their employers or members representing such employers;
2. Deliver said messages (including trading cards and written
orders) and communicate orders to the pit from their position or
communication instrument by use of hand signals or verbal communication;
3. Write broker's cards from endorsed orders, endorse orders from
broker's cards and write the brokers' acronym on the broker's order, during
trading hours on the Exchange Floor and for a reasonable period of time
thereafter;
4 Operate order processing terminals;
5. Receive and write up orders from, and report order status to,
their employers and their employers' duly registered Associated Persons,
Introducing Brokers, proprietary traders and customers with respect to
commodities traded on the Floor;
6. Communicate information of any nature directly to an individual
Member, provided that the information communicated may only concern a
contract which is within that individual Member's membership category;
7. Communicate information of any nature to a trader who is trading
for the proprietary account of the clerk's member firm employer or for the
proprietary account of a firm which has one of the following relationships
to the clerk's member firm employer:
- 100% parent firm;
- Wholly owned subsidiary; or
- Affiliate through a common 100% parent firm;
8. Provide market information (not the clerk's own personal opinion)
regarding activities on the Floor to any of the following:
- duly registered Associated Persons of the clerk's member firm
employer;
- duly registered Introducing Brokers of the clerk's member
firm employer; and
- established customers of the clerk's member firm employer;
For the purposes of this section 8., an "established customer"
shall be defined as an individual or entity which has an open and active trading
account with the clerk's member firm employer.
A clerk may initiate contact with any of the foregoing to provide
market information provided that the clerk expresses no personal opinion
regarding market direction or specific trades.
A clerk may relay the opinions of a member or of the clerk's
member firm employer with the prior approval of such member or member firm
employer to any of the following:
- duly registered Associated Persons of the clerk's member
firm employer;
- duly registered Introducing Brokers of the clerk's member
firm employer; and
- established customers of the clerk's member firm
employer.
9. Initiate contact with a customer of the clerk's member firm
employer to report the status of that customer's order;
Floor Clerks and Trainee-Floor Clerks may not, while on the Floor of the
Exchange, perform any other duties except those explicitly prescribed above. The
following Exchange Floor activities are permissible only for members and only
with respect to the contracts in which they have membership privileges. The
following activities are prohibited for Floor Clerks and Trainee Floor Clerks:
1. Soliciting customer business;
2. Trading for their own accounts or having any interest in a
trading account, except as prescribed in Regulation 301.05;
3. Being an RCR or an Associated Person, a Commodity Pool Operator
or a Commodity Trading Advisor under the Commodity Exchange Act.
4. Initiating orders or trades of any sort, including arbitrage;
5. Exercising discretion of any sort with respect to any order,
including arbitrage;
6. Loitering by or in the trading pits;
7. Being compensated on a commission or per contract basis.
B. Trade Checkers (only) may perform only the following duty and no others
while on the Floor of the Exchange.
1. Check and reconcile trades of, for, and on behalf of their member
firm employers. Absent extraordinary circumstances, the Floor Governors
Committee would expect such Trade Checkers to be off the Floor of the
Exchange by 10:30 a.m.
This 10:30 a.m. limitation does not apply to floor clerks who are
employed by individual members.
Trade Checkers may not, while on the Floor of the Exchange, perform any other
duties except that explicitly prescribed above. The following is a list of the
most common abuses of the Trade Checker privilege:
1. Loitering by or in the trading pits or congregating in unassigned
areas;
2. Communicating in any manner with members or member firms;
3. Entering verbal orders with members or member firms;
4. Trading for their own accounts;
5. Being or acting in any other capacity, including chartist, with a
member or member firm;
6. Being an RCR or Associated Person under the Commodity Exchange
Act, as amended by the Commodity Futures Trading Commission Act of 1974.
C. Personnel
1. Emergency Personnel - See Floor Clerks and Trainee-Floor Clerks
(Paragraph A above);
2. Summer Personnel - See Floor Clerks and Trainee- Floor Clerks
(Paragraph A above);
D. Registered Commodity Representatives (RCRs) and Applicant Observers may
perform only the following duty and no other while on the Floor of the
Exchange:
1. Observe the various floor activities of the members and other
privileged non-members who have been allowed access to the Floor. Such
observation shall be limited to a period of two weeks (ten market days).
RCR Observers and Applicant Observers may not, while on the Floor of the
Exchange, perform any other duties except that explicitly prescribed above. The
following are the areas most prone to abuse and which the RCR Observer and
Applicant Observer must be especially aware of:
1. Loitering by or in the Trading pits or congregating in unassigned
areas;
2. Answering phones;
3. Placing verbal orders with members of member firms;
4. Writing orders;
5. Trading for their own accounts;
6. Being or acting in any other capacity, including chartist, with a
member or member firm.
E. The Floor Conduct Committee has established a special broker assistant
badge, in addition to a regular floor clerk badge, and has set up the
following guidelines to be used in issuing this special badge.
A broker assistant badge will only be issued for the following
purposes:
- a broker having a high volume of orders and who needs an
assistant to hold and sort the orders;
- Consistent with these duties, a broker assistant also may
communicate market information by means of hand signals and
verbal communication.
A badge will not be issued if used for the following reasons:
- card counting - if a floor clerk is a card counter, he/she
must quickly enter and take the cards and count them outside
of the pit and;
- Information - a floor clerk who obtains information about
other brokers or another commodity.
Please keep in mind that the abuses of the floor clerk badge will still be
upheld for those issued a broker assistant badge, as follows:
1. Loitering by or in the trading pits or congregating in unassigned
areas.
2. Not properly displaying their assigned floor badges.
3. Trading for their own accounts.
4. Being or acting in any other capacity, including chartist, with a
member or member firm. A limited exception to this provision
applies, only with respect to agricultural markets, as follows.
Clearing firms may arrange with floor brokers to place clearing
firm floor clerks in pits to perform broker assistant
responsibilities for such floor brokers when conditions of high
volume/high volatility occur. Such arrangements must be
registered with the Exchange as prescribed by the Exchange. Under
these arrangements, clearing firms will continue to be
responsible for these clerks' supervision and compensation. When
conditions of high volume/high volatility are not present, such
clerks will return to their normal duties on behalf of their
clearing firm employers.
5. Being an Associated Person under the Commodity Exchange Act, as
amended by the Commodity Futures Trading Commission Act of 1974.
The committee advises members that the Board of Directors gave fining
authority to the Floor Conduct Committee of up to $500 for conduct
violations of Floor Employees of Members. The fining authority begins
December 21, 1981.
Your cooperation in this matter would be greatly appreciated.
F. The Exchange has established guidelines regarding the use of headsets in
1. Brokers' Assistants and Floor Clerks with headset privileges
shall be subject to all applicable CBOT Rules and Regulations, including
Rule 301.00; Regulations 301.01, 301.05 and 310.01; and this Appendix. In
addition, members who either sponsor or employ an individual utilizing a
headset are responsible for ensuring that the sponsored or employed
individual complies with the Exchange's Headset Policy.
2. All members and member firms are eligible to receive
authorization to utilize headsets. The authority to govern the
administration of the use of headsets (including who has authorization and
where an authorized individual may utilize the headset apparatus) rests
with the Floor Committee. The Floor Committee should establish fair and
equitable guidelines for
administering the use of headsets, and when administering its guidelines,
the Floor Committee should consult with the relevant Pit Committee. The
Floor Committee shall not arbitrarily deny any member or member firm the
use of a headset.
3. Headsets may be worn by Brokers' Assistants, Floor Clerks, and
Members who have been authorized by the Floor Committee. "Brokers'
Assistants" and "Floor Clerks" as used in preceding sentence may include
members and membership interest holders who do not have membership
privileges in the contract for which the headset is being utilized.
4. A Broker's Assistant or Floor Clerk wearing a headset may
communicate order information and fill information but may not communicate
his or her personal opinion regarding activities in the trading pit
including, but not limited to, interpretations of technical or fundamental
market factors or perspective with respect to member trading sentiment or
trading bias. Any other information may be communicated via a headset if
the information has been conveyed to the headset operator directly by a
member (providing that the member conveying the information has trading
privileges in the relevant underlying market). In addition, Brokers'
Assistants and Floor Clerks wearing headsets may communicate via a headset
any market information that is clearly within the respective pit's "public
domain". In other words, individuals who are wearing headsets may
communicate any market information that has been "publicly" exposed to the
respective trading pits. The member sponsor or member employer of the
individual wearing the headset is responsible for the content and nature of
any headset communications.
- Only members on the floor may communicate with non-members located off
the floor for the purposes of communicating or receiving market news and
personal opinion regarding interpretations of technical or fundamental
market factors or perspective with respect to a member's trading sentiment
or trading bias. This level of communication is restricted to members with
trading privileges in the respective contract who are located on the floor
communicating with other members or non-members located either on or off of
the trading floor.
5. Headsets may communicate between trading pits and from pit to Exchange
floor booth spaces in any CBOT(R) trading room. This includes COM
Membership Interest Holders communicating with a floor broker or the
floor broker's broker assistant in a futures pit for the purposes of
entering futures orders.
Direct communication via headsets located in or around the Exchange's
trading pits to and from off-site locations is only allowed provided the
individual assigned to a headset adheres to the following requirements when
communicating with any individual off the Exchange floor:
- Headset communications shall be permissible between the
Dow(SM) pits and the floors of other exchanges which trade
equity-related products.
- An individual member located outside a trading pit (e.g., at
a floor booth or in an off-site office) may communicate via
headset with a member or clerk in or around a trading pit
provided that the individual member has trading privileges
in the contract which is traded in the pit which the
individual accesses.
- Members off the floor can enter orders via headsets for
their customer, proprietary and personal accounts provided
they have trading privileges in the respective contract.
- Members off the floor utilizing headsets for the purposes of
entering customer orders directly into the pit must comply
with Exchange audit trail regulations previously mandated by
the CFTC which require that customer orders be: recorded on
member firm floor order tickets; contain the account
identification of the customer; contain an exchange
designated time stamp upon receipt and upon confirmation of
an execution. The Exchange provides a telephonic link
between the booth and the pit to allow for a floor broker to
communicate directly with a member who is located off the
floor, while simultaneously allowing personnel at the member
firm's booth to record the required audit trail information.
- Floor brokers who utilize headsets in conjunction with an
electronic order routing/endorsement system are not required
to maintain a booth to pit link provided that customer
orders are entered electronically and the order entry system
provides the requisite audit trail.
- Floor brokers receiving orders from another member not
present on the Exchange Floor may record such trades on
their trading cards in lieu of obtaining an order ticket.
However, the executing member must record the order
instructions, account designation, and time stamp the card
upon receipt and execution on the member's order.
- Only Members located on the floor may communicate with non-
members located off the floor for the purpose of placing
orders for the member's personal trading account or the
member firm's proprietary account in CBOT contracts and non-
CBOT markets.
- Only Members located on the floor communicating with non-
members located off of the trading floor may accept orders
or instructions to change orders from the non-member for
agricultural and financial futures and options contracts
provided the requisite audit trail requirements are met
utilizing the booth to pit link.
6. Any and all headset communications must be voice recorded by the
member or member firm authorized to use the headset(s). Members and member
firms are permitted to utilize their own recording devices, providing that
the devices meet reasonable standards with respect to quality and
reliability, or members and member firms may utilize an Exchange
administered voice recording system for a fee to be paid to the Exchange by
the member or member firm utilizing the Exchange's system.
7. For reasons relating to the general safety and space concerns that
arise out of the use of wired headsets, the Floor Committee is encouraged
to facilitate, as the development of technology permits, a movement to a
wireless headset only environment.
8. Authorization to use a headset does not entitle the authorized
individual to a particular spot or site within a pit. In addition, Floor
Clerks utilizing headsets may not loiter in the trading pits and must exit
the trading pits when they are not conducting business. (11/01/99)
APPENDIX 3C - DRESS CODE
APPENDIX 3-C - DRESS CODE
Members and member firms must make every effort to ensure that their employees
and guests conform to the Chicago Board of Trade's Dress Code, as hereafter
defined. The Dress Code is designed to provide a safe and businesslike
atmosphere on the trading floor for all members and employees; an individual may
be refused access to the trading floor for violating the Dress Code. Members and
Member firms are subject to fines and/or other disciplinary measures imposed by
the Floor Conduct Committee for individual violations of the dress code and
violations of the dress code by their employees.
The Chicago Board of Trade Dress Code requires "Business Dress Attire" to be
worn at all times on the trading floor-not only during trading hours. "Business
Dress Attire" is defined as conventional and businesslike attire which is neat,
clean and presentable; does not pose a safety hazard or distraction to the
wearer or others; and that which conforms to the following provisions:
A) Jackets (Suit Coat, Blazer or a Trading Jacket as prescribed by the
Association) must be worn on the trading floor by Members and
employees at all times. No trading jackets from other Exchanges are
allowed on the floor. Guests may not wear trading jackets on the
Exchange floor during trading hours. The display of patches or buttons
with crude or offensive slogans is prohibited.
B) Badges, as prescribed by the Association, designating Member trading
and access rights and non-member affiliation and access rights must be
worn at all times. Badges must be worn in plain view, on the upper
front of the jacket (not inside pockets or attached to lower pockets.)
Badges from other Exchanges are prohibited. The wearing of out-dated,
unauthorized or lapsed membership badges from the Exchange is
prohibited. Badges must not be defaced, altered, or affixed with
stickers or pictures not approved by the Association.
C) Men must wear ties (bow ties or neckties) at all times on the trading
floor, with the exception of days when there is an early close for any
part of the Exchange. Ties must be in good condition, knotted in a
conventional manner, and drawn up to at least the second button from
the collar. Collared shirts that can be worn with a tie must be worn
at all times on the trading floor and must be neat, presentable and
businesslike. Shirts must be clean, neat, presentable, tucked in and
buttoned up to at least the second button from the collar. Golf-type
shirts are permitted. Turtleneck sweaters for men are not allowed.
Crewneck sweaters worn over a collared shirt are permitted if a
necktie is visible; a trading jacket must also be worn. Shirts with
offensive, crude or distracting slogans or pictures are prohibited.
Pants or slacks must be neat, presentable and businesslike. Work
pants, athletic pants and blue jeans are prohibited.
D) Women must wear pants, skirts or dresses that are neat, presentable,
and businesslike. Skirts may be no shorter than two inches above the
knee and must be significantly longer than the trading coat. Full,
generously cut, businesslike split skirts may be worn. Shirts,
blouses, sweaters or other tops must be neat, presentable, and
businesslike. Shirts with offensive, crude or distracting slogans or
pictures are prohibited. Work pants, athletic pants and blue jeans are
prohibited. Attire should not expose the body in an inappropriate
manner (e.g. bare midriffs, backs or thighs.)
E) Shoes must be worn at all times. Shoes must neither be of a design nor
worn in a manner which presents a safety hazard. Slippers, open-toed
shoes and sandals of any kind are prohibited. High platform shoes or
high heeled shoes or boots with soles and/or heels greater than three
inches are not permitted. Athletic shoes are permitted. Shoes must be
in neat condition and must be tied or fastened at all times.
F) Shirts: T-Shirts, sweatshirts, athletic jerseys, hooded shirts,
flannel shirts, hospital scrubs and shirts bearing messages,
advertisements, pictures or slogans are prohibited. Attire should not
expose the body in a manner inappropriate for business (e.g. bare
midriffs, chests, or backs.)
G) Pants: The following are all prohibited: blue jeans, stone washed
jeans, bib overalls, fatigues, tie dyes, shorts of any kind, tightly
fitting stretch pants, spandex pants, bicycling pants, painter pants,
sweat pants, athletic/exercise pants, pants with elastic at the
ankles, tights worn in lieu of pants, pants with slogans,
advertisements, or work loops, and any pants shorter than 2 inches
above the ankle.
H) Piercing & Jewelry: Jewelry may not be worn if it presents a safety
hazard to the wearer or others.
I) Miscellaneous: All headgear or head coverings are prohibited, except
for religious reasons. Sunglasses are prohibited unless they have
prescription lenses.
In Summary: All dirty, frayed, faded, torn, badly wrinkled, revealing or
unbusinesslike clothing is prohibited. All clothing intended for athletic
activity or appropriate for manual labor is prohibited. Attire, worn by members,
employees or their guests, which exposes the body in a manner inappropriate for
a business atmosphere is prohibited from the trading floor at all times.
While the foregoing is comprehensive and employers and security staff shall
enforce the dress code as defined above, they are not limited to the specific
examples given. 10/01/00
APPENDIX 3D - CHICAGO BOARD OF TRADE PIT OPENINGS AND
CLOSINGS/ELECTRONIC TRADING HOURS
[Enlarge/Download Table]
Commodity Commodity Open Close Type Room Symbol
Code
-------------------------------------------------------------------------------------------------------------
W Wheat 9:30 am 1:15 pm Regular Main W
-------------------------------------------------------------------------------------------------------------
W Wheat Options " "
(Puts) Regular Main WZ
(Calls) Regular Main WY
-------------------------------------------------------------------------------------------------------------
C Corn 9:30 am 1:15 pm Regular Main C
-------------------------------------------------------------------------------------------------------------
C Corn Options " "
(Puts) Regular Main PY
(Calls) Regular Main CY
-------------------------------------------------------------------------------------------------------------
O Oats 9:30 am 1:15 pm Call Main O
-------------------------------------------------------------------------------------------------------------
O Oats Options " "
(Puts) Call Main OV
(Calls) Call Main OO
-------------------------------------------------------------------------------------------------------------
S Soybeans 9:30 am 1:15 pm Regular Main S
-------------------------------------------------------------------------------------------------------------
S Soybean Options " "
(Puts) Regular Main PZ
(Calls) Regular Main CZ
-------------------------------------------------------------------------------------------------------------
1C CBOT(R)DJCA(SM) 7:20 am 3:15 pm Regular Finc'l DE
Index
-------------------------------------------------------------------------------------------------------------
1T CBOT(R)DJTA(SM) 7:20 am 3:15 pm Regular Finc'l DQ
Index
-------------------------------------------------------------------------------------------------------------
1U CBOT(R)DJUA(SM) 7:20 am 3:15 pm Regular Finc'l DR
Index
-------------------------------------------------------------------------------------------------------------
2F Agency Notes (10 7:20 am 2:00 pm Regular Finc'l DN (open
Year) outcry)
AN (e-cbot)
-------------------------------------------------------------------------------------------------------------
2F Agency Notes (10 " "
Year) Options
(Puts) Regular Finc'l DNP
(Calls) Regular Finc'l DNC
-------------------------------------------------------------------------------------------------------------
06 Soybean Meal 9:30 am 1:15 pm Call Main SM
-------------------------------------------------------------------------------------------------------------
06 Soybean Meal Options " "
(Puts) Call Main MZ
(Calls) Call Main MY
-------------------------------------------------------------------------------------------------------------
07 Soybean Oil 9:30 am 1:15 pm Call Main BO
-------------------------------------------------------------------------------------------------------------
07 Soybean Oil Options " "
(Puts) Call Main OZ
(Calls) Call Main OY
-------------------------------------------------------------------------------------------------------------
10 1000 oz. Silver 7:25 am 1:25 pm Call Main AG
-------------------------------------------------------------------------------------------------------------
10 Silver Options " "
(Puts) Call Main AP
(Calls) Call Main AC
-------------------------------------------------------------------------------------------------------------
11 CBOT(R)DJIA(SM) Index 7:20 am 3:15 pm Regular Finc'l DJ
-------------------------------------------------------------------------------------------------------------
11 CBOT(R)DJIA(SM) Index " "
(Puts) Regular Finc'l DJP
(Calls) Regular Finc'l DJC
-------------------------------------------------------------------------------------------------------------
12 5000 oz. Silver 7:25 am 1:25 pm Call Main SV
-------------------------------------------------------------------------------------------------------------
14 Rough Rice Futures 9:15 am 1:30 pm Regular Main RR
-------------------------------------------------------------------------------------------------------------
14 Rough Rice Options " "
(Puts) Regular Main RRP
(Calls) Regular Main RRC
-------------------------------------------------------------------------------------------------------------
15 Kilo Gold 7:20 am 1:40 pm Call Main KI
-------------------------------------------------------------------------------------------------------------
19 100 oz. Gold 7:20 am 1:40 pm Call Main GH
Commodity Commodity Open Close Type Room Symbol
Code
------------------------------------------------------------------------------------------------------------------------------------
17 T-Bonds 7:20 am 2:00 pm Regular Finc'l US
------------------------------------------------------------------------------------------------------------------------------------
17 T-Bonds Options " "
(Puts) Regular Finc'l PG
(Calls) Regular Finc'l CG
------------------------------------------------------------------------------------------------------------------------------------
21 T-Notes 7:20 am 2:00 pm Regular Finc'l. TY
(61/2- 10 Year)
------------------------------------------------------------------------------------------------------------------------------------
21 Long Term T-Note Options " "
(Puts) Regular Finc'l. TP
(Calls) Regular Finc'l. TC
------------------------------------------------------------------------------------------------------------------------------------
[Enlarge/Download Table]
------------------------------------------------------------------------------------------------------------------------------------
25 T-Notes (5 Year) 7:20 am 2:00 pm Regular Finc'l. FV
------------------------------------------------------------------------------------------------------------------------------------
25 Medium Term T-Note Options " "
(Puts) Regular Finc'l. FP
(Calls) Regular Finc'l. FL
------------------------------------------------------------------------------------------------------------------------------------
26 T-Notes (2 Year) 7:20 am 2:00 pm Regular Finc'l. TU
------------------------------------------------------------------------------------------------------------------------------------
26 Short Term T-Note Options " "
(Puts) Regular Finc'l. TUP
(Calls) Regular Finc'l. TUC
------------------------------------------------------------------------------------------------------------------------------------
38 California PCS Insurance Small Cap 8:30 am 12:30 pm Regular Finc'l. HQ
(12 month)
------------------------------------------------------------------------------------------------------------------------------------
41 30-Day Fed Fund 7:20 am 2:00 pm Regular Finc'l. FF
------------------------------------------------------------------------------------------------------------------------------------
42 Long-Term Municipal Bond Index 7:20 am 2:00 pm Regular Finc'l. MB
------------------------------------------------------------------------------------------------------------------------------------
42 Long-Term Municipal Bond Index Options " "
(Puts) Regular Finc'l. QP
(Calls) Regular Finc'l. QC
------------------------------------------------------------------------------------------------------------------------------------
45 Illinois Corn Yield Insurance 10:30 am 12:45 pm Regular Main YG
------------------------------------------------------------------------------------------------------------------------------------
45 Illinois Corn Yield Insurance Options
(Puts) 10:30 am 12:45 pm Regular Main YGP
(Calls) YGC
------------------------------------------------------------------------------------------------------------------------------------
68 Indiana Corn Yield Insurance Futures 10:30 am 12:45 pm Regular Main YH
------------------------------------------------------------------------------------------------------------------------------------
68 Indiana Corn Yield Insurance Options 10:30 am 12:45 pm Regular Main
(Puts) YHP
(Calls) YHC
------------------------------------------------------------------------------------------------------------------------------------
69 Nebraska Corn Yield Insurance 10:30 am 12:45 pm Regular Main YI
Futures
------------------------------------------------------------------------------------------------------------------------------------
69 Nebraska Corn Yield Insurance 10:30 am 12:45 pm Regular Main
Options
(Puts) YIP
(Calls) YIC
------------------------------------------------------------------------------------------------------------------------------------
Appendix 3D
[Enlarge/Download Table]
Commodity
Code Commodity Open Close Type Room Symbol
---------------------------------------------------------------------------------------------------------------------------------
72 Iowa Corn Yield Insurance Futures 10:30 12:45 pm Regular Main CA
am
----------------------------------------------------------------------------------------------------------------------------------
72 Iowa Corn Yield Insurance Options 10:30 12:45 pm Regular Main
(Puts) am CAC
(Calls) CAP
----------------------------------------------------------------------------------------------------------------------------------
73 Ohio Corn Yield Insurance Futures 10:30 12:45 pm Regular Main YJ
am
----------------------------------------------------------------------------------------------------------------------------------
73 Ohio Corn Yield Insurance Options 10:30 12:45 pm Regular Main
(Puts) am YJP
(Calls) YJC
----------------------------------------------------------------------------------------------------------------------------------
74 U.S. Corn Yield Insurance Futures 10:30 12:45 pm Regular Main YC
am
----------------------------------------------------------------------------------------------------------------------------------
74 U.S. Corn Yield Insurance Options 10:30 12:45 pm Regular Main
(Puts) am YCP
(Calls) YCC
----------------------------------------------------------------------------------------------------------------------------------
81 National Annual PCS Insurance 8:30 am 12:30 pm Regular Finc'l HH
Small Cap (12 month)
----------------------------------------------------------------------------------------------------------------------------------
83 National Annual PCS Insurance 8:30 am 12:30 pm Regular Finc'l KH
Large Cap (12 month)
----------------------------------------------------------------------------------------------------------------------------------
89 Northeastern PCS Insurance 8:30 am 12:30 pm Regular Finc'l HR
Small Cap (12 month)
----------------------------------------------------------------------------------------------------------------------------------
10/01/00
*SUPPLEMENTAL INFORMATION
---------------------------
- Wheat Options open by call.
- Catastrophe Insurance, DJIA(SM) Index, Corn, Corn Yield Insurance,
Soybean, Rough Rice and Wheat Options will close by call on the last
day in an expiring series.
Electronic Trading Schedules
--------------------------------------------------------------------------------
T-Bonds & T-Notes (2 Year, 5 Year and 6 1/2 - 10
Year), Agency Note (10 Year), Municipal Bond Index
Futures & Options & 30 Day Fed Funds Futures
--------------------------------------------------------------------------------
Trading Day Trading Session
Monday Sun. (8:00 p.m.) - Mon. (4:00 p.m.)
Tuesday Mon. (8:00 p.m.) - Tue. (4:00 p.m.)
Wednesday Tue. (8:00 p.m.) - Wed. (4:00 p.m.)
Thursday Wed. (8:00 p.m.) - Thurs. (4:00 p.m.)
Friday Thurs. (8:00 p.m.) - Fri. (4:00 p.m.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Grains & Soybean Complex (Futures & Options)
--------------------------------------------------------------------------------
Trading Day Trading Session
Monday Sun. (8:30 p.m.) - Mon. (6:00 a.m.)
Tuesday Mon. (8:30 p.m.) - Tue. (6:00 a.m.)
Wednesday Tue. (8:30 p.m.) - Wed. (6:00 a.m.)
Thursday Wed. (8:30 p.m.) - Thurs. (6:00 a.m.)
Friday Thurs. (8:30 p.m.) - Fri. (6:00 a.m.)
--------------------------------------------------------------------------------
11/01/00
-------------------------------------------------------------------------------
CBOT(R) DJIA(SM) Index (Futures & Options), CBOT(R)DJTA(SM), DJUA(SM), &
DJCA(SM) Index (Futures), 100 oz. Gold & 5000 Silver (Futures)
-------------------------------------------------------------------------------
Trading Day Trading Sessions
Monday Sun. (8:15 p.m.) - Mon. (4:00 p.m.)
Tuesday Mon (8:15 p.m.) - Tue. (4:00 p.m.)
Wednesday Tue. (8:15 p.m.) - Wed. (4:00 p.m.)
Thursday Wed. (8:15 p.m.) - Thurs. (4:00 p.m.)
Friday Thurs. (8:15 p.m.) - Fri. (4:00 p.m.)
-------------------------------------------------------------------------------
11/01/00
Appendix 3E
APPENDIX 3E - CONTRACT MONTH SYMBOLS
[Enlarge/Download Table]
First Year Month Symbols
----------------------------------------------------------------------------------------------------
January - F April - J July - N October - V
----------------------------------------------------------------------------------------------------
February - G May - K August - Q November - X
----------------------------------------------------------------------------------------------------
March - H June - M September - U December - Z
----------------------------------------------------------------------------------------------------
Second Year Month Symbols
----------------------------------------------------------------------------------------------------
January - A April - D July - L October - R
----------------------------------------------------------------------------------------------------
February - B May - E August - O November - S
----------------------------------------------------------------------------------------------------
March - C June - I September - P December - T
----------------------------------------------------------------------------------------------------
Third Year Month Symbols
------------------------
Same as first year symbols with the year noted.
Appendix 3G
APPENDIX 3G - GUIDELINES - BADGE VALIDATION AND RETURN
1. In each of the following circumstances, the referenced individual's
membership floor access badge must be returned to the Member Services and
Member Firm Staff Services ("Member Services") Department as indicated if
the transaction involves the individual's only membership or all of his/her
memberships:
a. A membership seller within 30 days the effective date of the
membership sale; (Membership sale proceeds will not be released to the
seller unless the badge has been returned).
b. A membership transferor within 30 days after the transfer has
occurred.
c. A membership delegator within 30 days after the effectiveness
of the delegation agreement.
2. Each membership delegate must return the applicable delegate badge to the
Member Services Department within 30 days after the delegation agreement's
termination or expiration.
3. Upon the effective date of any Exchange suspension of membership
privileges, the suspended individual must return his/her membership floor
access badge to the Member Services Department within 30 days of the
effective date of the suspension for the suspension's duration.
4. Upon the termination or expiration of any delegation agreement, the
Exchange will delete the terminated delegate's identifying acronym from
Exchange computer records after the delegate's 30-day grace period expires.
5. Only Exchange-issued badges will be permissible for floor access. Sewn-on
badges will not be permissible.
6. No member, membership interest holder or delegate will be relieved of
responsibility for returning the badge, even if lost, without specific
approval of the Floor Conduct Committee.
All cases involving lost membership floor access badges should be referred
to the Member Services Department which shall have the authority to issue a
replacement badge. Member Services will issue a replacement badge only to
individuals with valid membership floor access privileges and who are
current in their dues. Any problems or unusual circumstances involving a
lost membership floor access badge will be referred to the Floor Conduct
Committee.
All cases involving lost floor clerk badges will be referred to the Co-
Chairman or, in his absence, the Vice-Chairman of the Floor Conduct
Committee. No floor clerk will be issued a replacement badge or be relieved
of responsibility for returning the badge without specific approval of the
Co-Chairman or, in his absence, the Vice Chairman of the Floor Conduct
Committee.
7. Floor clerk badge applicants must present acceptable identification when
filing their applications. Exchange staff will verify member's co-
signatures on floor clerk badge applications and will process such
applications in no less than 24 hours after receipt.
03/01/94
Appendix 4C
APPENDIX 4C - CAPITAL REQUIREMENTS FOR NON-FCM MEMBER FIRMS
The minimum financial requirements for Non-FCM member firms are:
1. a. Net Worth in excess of $100,000. For the purpose of this subsection,
Net Worth is defined as total assets (inclusive of CBOT memberships at 70% of
their market value) minus all liabilities with the exception of those which
qualify as equity capital; or
b. For firms that are registered as a Professional Trading Firm under
Regulation 230.02(6), the net worth shall be the greater of $100,000 per active
floor trader who personally executes a significant portion of his or her orders
on the trading floor and for the firm's proprietary account or 25% of the
*SPAN(R) margin requirement. For the purpose of this subsection, Net Worth is
defined as total assets (inclusive of CBOT full and associate memberships at 70%
of their market value and COM membership interests at 50% of their market value)
minus all liabilities with the exception of those which qualify as equity
capital;
2. Any firm which relies on subordinated debt to meet the minimum Net Worth
requirement must submit a copy of the subordinated loan to the Office of
Investigations and Audits ("OIA") for approval. All loans must generally comply
with the rules regarding subordinated loans for FCMs. Subordinated debt may not
exceed 70% of total capital. A standard Non-FCM subordinated loan agreement is
available from OIA;
3. Each Non-FCM firm is required to file a yearly financial statement within
90 days of the firm's year-end. In addition, the Exchange may request additional
financial information as it deems appropriate;
4. A Letter of Attestation must accompany all financial statements. The Letter
of Attestation must be signed by the individual designated as the Chief
Financial Officer (or as having these responsibilities), in accordance with
Chicago Board of Trade Regulation 230.03(a), provided that he is either a member
of the Chicago Board of Trade whose membership is registered for the firm or
that he has executed, and filed with the Exchange, a Designated Person Consent
to Jurisdiction. In the case of a partnership, such individual must also be a
general partner. The signature of the Chief Financial Officer, or the person who
has these responsibilities, may be waived by the Exchange, at the discretion of
the Exchange. In the event of such waiver, the firm will be required, in the
case of a partnership, to have a general partner sign the financial statements.
In the case of a corporation, the firm will be required to have the Chief
Executive Officer sign the financial statements. In either event, the individual
must either be a member of the Chicago Board of Trade or must have executed, and
filed with the Exchange, a Designated Person Consent to Jurisdiction.
Nothing contained herein shall be construed to prevent the Board of Trade
Clearing Corporation from establishing capital requirements, for its members or
applicants for membership in the Clearing House, different or greater than those
prescribed herein.
* "SPAN" and "Standard Portfolio Analysis of Risk" are trademarks of the
Chicago Mercantile Exchange. The Chicago Merchantile Exchange assumes no
liability in connection with the use of SPAN by any person or entity.
01/01/99
APPENDIX 4E - MINIMUM FINANCIAL REQUIREMENTS FOR AGRICULTURAL REGULARITY
The minimum financial requirements for firms which are regular to deliver
agricultural products are:
1. Working Capital - (current assets less current liabilities) must be greater
than or equal to $2,000,000. Firms which do not have $2,000,000 in Working
Capital must deposit with the Exchange $5,000 per contract which it is
regular to deliver, up to a maximum of $2,000,000, less SEC haircuts, as
specified in SEC Rule 15c3-1(c)(2)(vi), (vii) and (viii) plus 3% in the
event of liquidation;
2. New Worth - (Total assets less total liabilities) divided by the firm's
allowable capacity (measured in contracts) must be greater than $5,000; The
net worth of a firm regular to deliver corn or soybeans must be greater
than or equal to $5,000,000. The operator of a shipping station issuing
corn or soybean shipping certificates may only issue new shipping
certificates when the total value of all outstanding shipping certificates
and the new shipping certificates, at the time of issuance of the new
shipping certificates, does not exceed 25% of net worth;
3. Each firm which is regular to deliver agricultural products is required to
file a yearly certified financial statement within 90 days of the firm's
year-end. Each such firm is also required to file within 45 days of the
statement date an unaudited semi-annual financial statement. However, each
operator of a shipping station issuing corn or soybean shipping
certificates is required to file within 45 days of the statement dates
unaudited quarterly financial statements for each of the three quarters
which do not end on such firm's year-end. In addition, the Exchange may
request additional financial information as it deems appropriate;
4. A Letter of Attestation must accompany all unaudited financial statements.
The Letter of Attestation must be signed by the Chief Financial Officer or
if there is none, a general partner, executive officer, or managerial
employee who has the authority to sign financial statements on behalf of
the firm and to attest to their correctness and completeness.
5. For the requirements for notification of capital reductions, see Regulation
285.03.
01/01/00
Appendix 6A
APPENDIX 6A - FEE SCHEDULE: Member Claims
--------------------------------------------------------------------------------
Amount of Claim
--------------------------------------------------------------------------------
$2,500 or less........................................ $150.00
More than $2,500...................................... $250.00
--------------------------------------------------------------------------------
Stenographic Fees*
--------------------------------------------------------------------------------
For attendance at a meeting:
2-1/2 hour minimum.................................... $ 50.00
Per Hour.............................................. $ 20.00
Per Half Hour......................................... $ 10.00
For transcript:
Original per page..................................... $ 2.00/page
Carbon per page....................................... $ .90/page
Original per page (Daily copy)........................ $ 2.60/page
Carbon per page (Daily copy).......................... $ .90/page
------------------------------------------------------------ -------------------
*Only for oral hearings.
Appendix 6B
APPENDIX 6B - FEE SCHEDULE: Customer and Non-Member Claims
--------------------------------------------------------------------------------
Amount of Claim
--------------------------------------------------------------------------------
$2,500 or less........................................ $150.00
More than $2,500...................................... $350.00
--------------------------------------------------------------------------------
Unassociated Arbitrators*
------------------------
$50 per unassoicated arbitrator per hearing** for claims heard pursuant
to Regulation 630.12 [$2,500 or less] [minimum charge of $150].
$100 per unassociated arbitrator per hearing date** for claims heard
pursuant to Regulation 630.08 [more than $2,500] [minimum charge of
$300].***
--------------------------------------------------------------------------------
Stenographic Fees*
--------------------------------------------------------------------------------
For attendance at a meeting:
2-1/2 hour minimum.................................... $ 50.00
Per Hour.............................................. $ 20.00
Per Half Hour......................................... $ 10.00
For transcript:
Original per page..................................... $ 2.00/page
Carbon per page....................................... $ .90/page
Original per page (Daily copy)........................ $ 2.60/page
Carbon per page (Daily copy).......................... $ .90/page
--------------------------------------------------------------------------------
* Optional
** Hearings are normally scheduled for 2:15 p.m. and seldom last more than
2-1/2 hours. If a hearing lasts in excess of 2-1/2 hours, requires an
additional hearing date, or is continued on less than 24 hours' notice
to the Administrator, fees will be charged for an additional hearing
date.
*** These direct incremental costs attendant upon the provision of
unassociated arbitrators will be paid by the member in cases involving
customer claims regardless of the outcome of the arbitration unless the
arbitrators decide that the customer has acted in bad faith in
initiating, or participating in, the arbitration proceeding. Such
incremental costs shall be allocated between the parties in the
arbitrators' discretion in cases involving non-member claims.
APPENDIX 9B - IMPLEMENTATION REGULATIONS OF e-cbot CONCERNING TECHNICAL
EQUIPMENT
1 Definitions
1.1 Network
The Network (the "Network") includes the entirety of all hardware elements
combined in each network node as well as all necessary components for the
connection of the network nodes (transmission lines for telecommunications,
etc.) which form the technical basis for the implementation of trading on e-
cbot, Eurex Deutschland and Eurex Zurich (the "Alliance Exchanges"). The Network
is constructed in a radial form and contains, as network nodes in particular,
the central host node of e-cbot, the central host node of the Eurex Deutschland
and Eurex Zurich ("the Eurex Exchanges"), and the access points and all
components of Participant Front End Installations.
1.2 Electronic Data Processing System
The Electronic Data Processing System (the "EDP System") includes both the
Network and the operation-ready installed application of one or more of the
Alliance Exchanges.
1.3 Participant Front End Installation
A Participant Front End Installation consists of one or more computers which
enable trading on e-cbot (a Participant Front End System according to subsection
1.4 or a Multi-Member- Front End System according to subsection 1.5) and Network
components by which the connection to the Network is made. In addition, the
Participant Front End Installation shall include all necessary components for
the maintenance of such Exchange Participant's internal network connections
(e.g., Gateways, Routers, etc.), provided that they are located in a network
area reserved for the Exchange (the 'Logical Network'). Additional hardware
elements are not components of the Participant Front End Installation, although
they may be connected thereto, to the extent that they satisfy the interfacing
demands established by the Exchange and - if required- have been registered at
the Exchange.
1.4 Participant Front End System
A Participant Front End System consists of at least one Exchange Participant's
computer integrated into the Network, and is equipped with sufficient capacity
and data security options in order to secure the technical basis on the part of
the Exchange Participant for participation on e-cbot. A Participant Front End
System is a component of the Participant Front End Installation (subsection 1.3)
and as such is part of the Network.
1.5 Multi-Member-lntegrated System Server
(a) Two or more Exchange Participants may access e-cbot by means of a common
Front End System (Multi- Member-Front End System), which is a component of
the Front End Installation (subsection 1.3). In such cases, the Exchange
Participants should notify the Exchange to adjust the capacity of the
telecommunications connection accordingly. A Multi-Member Front End System-
should be installed as a 2-LAN configuration and connected as a MISS group
with two servers.
(b) CBOT Direct - e-cbot may maintain a MISS group as part of a Front End
Installation through which one or more Exchange Participants may access e-
cbot with the approval of their primary clearing member.
1.6 Logical Network
The Logical Network includes, in addition to the Network, all components at the
Exchange Participant's site which are connected for technical reasons to the
Network. Such components must be located in a network area reserved for the
Exchange.
1.7 Data Transmission Equipment
Telecommunication within the Network occurs by means of Data Transmission
Equipment, consisting of access points, routers and data transmission lines. A
Participant Front End System or a Multi-Member Front End System shall always be
connected by at least two data transmission lines to an access point.
1.8 Network Parameters
Network Parameters are values, dependent on the network software and its
underlying operating system software, which control the communication between
computers within a network. Network Parameters are installed with standard
settings prescribed by the Exchange upon the initial installation of the
software relating to network functions.
1.9 Auto-Quote Machines
Auto-Quote Machines are automatic quotation systems for options and futures. On
the basis of pricing information and additional parameters determined by the
Exchange Participant, quotes are automatically generated by an Auto-Quote
Machine and transmitted into the EDP System.
1.10 Electronic Eyes
Electronic Eyes are computer programs which continuously receive market prices
of Exchange products from the EDP System and evaluate such market prices. As
soon as the price of an order or quote which is received by the Electronic Eye
lies within the range previously set by the Exchange Participant, the Electronic
Eye automatically generates an order which is then transmitted through the
programmable interfaces made available via the Participant Front End System to
the EDP System for execution.
1.11 Third Party Software
Third party software is software which is not provided by or on behalf of e-cbot
and which is connected by an Exchange Participant to the programmable interface
of the EDP System.
1.12 Location
Subject to Regulation 9X.06, Location within the meaning of this provision means
the entirety of all business premises occupied by an Exchange Participant within
a building in which Participant Front End Installations have been installed for
the purpose of active options and futures trading. Business premises in which
Participant Front End Installations are only employed in emergencies or for the
purpose of engaging in technical simulated tests are not deemed to constitute a
Location within the meaning of this provision.
2 Connection to the EDP System
2.1 Requirements
Upon admission to participate in options and futures trading, the Exchange
Participant is connected to the EDP System. This connection is subject to the
Exchange Participant's compliance with Exchange Rules, including these
Implementation Regulations. By the establishment of such connection, the EDP
System shall not be compromised on the basis of Location or any other technical
grounds. Each Exchange Participant undertakes to ensure that it is entitled to
connect each of its Participant Front End Installations to the EDP System and
to execute trading on e-cbot, according to the national laws and regulations
effective in the country of each respective Location.
2.2 Installation of Participant Front End Installations
Each of an Exchange Participant's Front End Installations, if not employed in
emergencies or for the purpose of participating in technical simulated tests
(subsection 1.12) must be installed at a Location of the Exchange Participant
and should be configured redundantly.
Upon receipt of prior notification from an Exchange Participant or from an
applicant for Exchange admission, the Exchange may permit the installation and
the operation of a Participant Front End Installation at the business premises
of a third party engaged by the Exchange Participant or applicant for Exchange
admission to operate such Participant Front End Installation, if the application
of and compliance with the provisions of the rules and regulations of the
Exchange and supplemental conditions thereto are ensured, in particular in
respect of such third party. By means of appropriate agreements concluded with
the third party, the Exchange Participant or applicant for Exchange admission
shall secure the granting to the Exchange by the third party of the right to
inspect the business premises of such third party at all times for the purpose
of determining compliance with the requirements for the installation and
operation of a Participant Front End Installation.
2.3 Installation of Several Participant Front End Systems
An Exchange Participant may apply for the connection of several Participant
Front End Systems. The Exchange may limit the number of Participant Front End
Systems applied for by an Exchange Participant for cause, including reasons
relating to system performance.
2.4 Connection of Quote Machines/Electronic Eyes
Upon special application by an Exchange Participant, the Exchange may permit the
connection of Auto-Quote Machines and/or Electronic Eyes to the EDP System
through the programmable interfaces made available via the Participant Front End
System, provided that the Exchange Participant continuously ensures that the
Auto-Quote Machines and/or Electronic Eyes
. are installed at the Locations of the Exchange Participant and
. are given parameters which correspond to at least one member for the
Exchange Participant and
. are controlled by at least one such person during trading hours.
3 Technical Requirements
The technical requirements set forth herein are binding on all Exchange
Participants; divergence from such regulations shall require the written consent
of the Exchange. The Exchange may at any time examine the configurations and
Network Parameters of an Exchange Participant and require the modification of
divergent values. In modifying such values, the Exchange Participant is
required to effect such technical modifications to its Participant Front End
Installation as are required by the Exchange within any timeframe imposed by the
Exchange. Upon request from the Exchange , the Exchange Participant is obligated
to grant the Exchange access to the technical infrastructure employed by it for
establishing a connection with the EDP System to facilitate the carrying out of
technical inspections. Such access and/or any right of inspection is subject to
applicable local law. If modifications are not completed within the time frame
imposed by the Exchange, the Exchange may restrict or bar the Exchange
Participant's access to the EDP System.
4 Hardware
4.1 Requirements
EDP equipment which ensures the orderly execution of trading over the EDP System
must be made available by Exchange Participants.
4.2 Permitted Trading Platforms
The Alliance Exchanges shall specify permitted trading platforms for
installation on the Participant Front End Installation connected to the EDP
System.
4.3 Approved Hardware Configurations
All hardware configurations planned by an Exchange Participant must be approved
by the Exchange - by submitting the configuration questionnaire supplied by or
on behalf of the Exchange and filled in by the Exchange Participant- prior to
their installation; the same shall apply to modifications.
4.4 Responsibility for Operation
The operation of the Participant Front End Installation (including integrated
Routers) is the sole responsibility of the Exchange Participant. Each Exchange
Participant shall guarantee that it will operate its Participant Front End
Installation in an orderly manner, and that, by such operation, the operation
and functionality of trading and clearing on the Alliance Exchanges shall not be
compromised.
5 Software
5.1 Exchange Software
The Exchange shall make available to the Exchange Participants the application
software without source code. Subject to the rules and regulations of the
Exchange, including these Implementation Regulations, an Exchange Participant is
hereby granted a non-exclusive, non-transferable, revocable license to use the
current version of the application software as made available by the Exchange
solely for trading on e-cbot at an approved Location and may neither alter nor
copy such software without the consent of the Exchange. The foregoing shall not
apply to the production of copies of the application software if such copies are
produced solely for data storage purposes. Each Exchange Participant is
responsible for the installation of the application software on the components
of his Participant Front-End installation.
5.2 Participant's Operating System Software
The Exchange shall specify each version of the operating system software valid
at the time, including all necessary components, used for operation of the
current version of the application software on the Participant Front End
Installation.
5.3 Registration of Third Party Software
If an Exchange Participant intends to connect Third Party Software to the
programmable interface of the EDP System, the Exchange Participant shall assign
an electronic identifier to such Third Party Software before connecting it to
the programmable interface, observing the Exchange's instructions as to the
systematic composition of such identifier, and shall have the Third Party
Software registered at the Exchange.
Each Exchange Participant shall ensure that the identifier assigned to Third
Party Software used by it will be sent together with each transmission to the
EDP System, when the registered Third Party Software communicates with the EDP
System via the programmable interface. In case the EDP System is impaired by
the Third Party Software connected to the programmable interface, the Exchange
may prohibit the connection of such software with immediate effect.
5.4 Responsibility for the Use of Third Party Software
The application software made available by the Exchange includes interfaces for
front and back office systems. The Exchange Participant itself is responsible
for the software which uses these interfaces.
6 Extent of Use of Data Transmission Equipment
An Exchange Participant may use the Data Transmission Equipment which serves
trading on e-cbot solely for trading on e-cbot unless otherwise approved in
writing by the Exchange. However, the Exchange reserves the right to use the
Data Transmission Equipment also for trading and clearing on other institutions.
7 Transmission Lines for Telecommunication
7.1 Control of Transmission Lines
The Exchange shall control the lines for the entire physical network/Network.
Installation and operation of the transmission lines for telecommunications
which are necessary for the connection between the Participant Front End
Installation and the Exchange shall be carried out by the Exchange or may be
contracted out by the Exchange.
7.2 Range of Transmission Lines
e-cbot shall make available a connection to the Location of the Exchange
Participant, provided that the transmission paths and types of connection
supported by e-cbot are available for such Exchange Participant and, under
normal conditions and adequate expense, able to be established and operated
while meeting the security and quality standards set forth by e-cbot.
7.3 Connection to Network
A Participant Front End Installation may only be connected to the access point
designated by the Exchange, and such connection must be by means of at least two
transmission lines.
7.4 Security Against Failure
In order to increase security against failure, Participant Front End
Installations may be connected to the Network by means of more than two lines.
7.5 Number of Transmission Lines
Notwithstanding these regulations, the Exchange can set a minimum and maximum
number of the transmission lines necessary for an Exchange Participant to
connect its Participant Front End Installation to the EDP System, to the extent
that such action is necessary for reasons relating to system performance or for
other serious reasons.
8 Network Parameters
8.1 Specification of Network Parameters
To ensure the security of the Network and to protect the Participant Front End
Installations, each Exchange Participant shall comply with the following Network
Parameters.
. An Exchange Participant's computers which are not components of the
Participant Front End Installation may only access the Participant Front End
Systems of such Exchange Participant and may not access other computers in
the Network;
. Only the computers of the Participant Front End Installation may access or
be accessed from the Network;
. Unauthorized access by a Participant Front End Installation to the computers
of the Alliance Exchanges is prohibited,
. Communication between Exchange Participants by means of the Network is
prohibited.
8.3 Compliance With Network Parameters
Upon installation of the Participant Front End Installation and Network
components, the Exchange Participant shall establish and maintain the Network
Parameters selected by the Exchange.
8.4 Reservation of Network Areas
The Exchange reserves network areas for its Logical Network. The network areas
selected by the Exchange can only be used for participation on the Exchange.
Within its own network, each Exchange Participant may use any network areas that
are not reserved for the Exchange.
8.5 Node Numbers/Node Names
The Exchange shall assign node numbers and node names for the entire Logical
Network. Within the Network, only the nodes authorized by the Exchange by
assignment of node numbers may communicate with the EDP System.
Consequently, no computer that has not received a corresponding node number from
the Exchange may be connected by the Exchange Participants in the network areas
reserved by the Exchange. The transfer of the assigned node number and the
related node name to a computer with a function other than that as applied for
is prohibited.
9 Emergency Plan
9.1 Responsibility
Each Exchange Participant is responsible for taking appropriate measures for
emergency planning and management.
9.2 Emergency Computer Center
An Exchange Participant may establish an inactive emergency computer center
(computer failure center) and, if necessary, may connect this center with an
inactive line to an access point. The costs incurred by the Exchange shall in
such case be paid by the Exchange Participant.
9.3 Connection Between Two Locations
It an Exchange Participant operates at two or more Locations, he may supply any
two Locations with a connection in order to ensure breakdown protection in the
event of a disruption of the connection between one Location and an access
point.
10 Personnel
Each Exchange Participant is obligated to maintain a sufficient number of
qualified personnel at all times during trading hours and to guarantee their
availability by telephone in order to ensure the orderly operation of the
components of the EDP System which are in the control of the Exchange
Participant, particularly in order to take the necessary measures at the
instruction of the Exchange in the event of a technical disruption. In addition,
each Exchange Participant shall provide the Exchange with the name and telephone
number of a person to be contacted in the event of a technical disruption.
11 Costs
11.1 Hardware and Software
The costs for the purchase, installation and maintenance of all hardware and
software used by an Exchange Participant shall be borne by the Exchange
Participant, and shall not be borne by the Exchange, provided that the
application software referred to in subsection 5.1 shall be made available by
the Exchange without additional cost.
11.2 Telecommunications Networks
The one-time and the continuing costs for establishing and operating the
Network, including the expenses for telecommunications transmission lines, will
be levied on Exchange Participants in the form of a fee established by the
Exchange.
12 Technical Problems
12.1 Measures
During technical disruptions, the Board may suspend or restrict access to the
EDP System for one, several or all Exchange Participants, regardless of whether
such problems appear at one or more of the Alliance Exchanges or at one, several
or all Exchange Participants. The Exchange may resume trading or re-commence
after an interruption, even if one or several Exchange Participants still do not
have access to the EDP System for e-cbot if in the opinion of the Board of
Directors an orderly market continues to exist or is once again possible.
12.2 Information to Exchange Participants / Exchange Participants' Obligation to
Cooperate
Exchange Participants are obligated to inform themselves about technical
requirements and changes by means of the media made available by the Exchange.
The Exchange shall, to the extent possible, inform the Exchange Participants
without undue delay of any technical problems. In case of technical problems of
the EDP System, Exchange Participants are obligated to grant the Exchange or its
representatives access to their Locations in which Participant Front End Systems
are installed for problem resolution.
12.3 Suspension of Options and Futures Trading
In the event of the suspension of trading on the basis of technical problems,
the Exchange shall place the EDP System on 'halt status', so that no more inputs
can be effected by Exchange Participants.
The resumption of trading after a trading suspension pursuant to the foregoing
regulation shall begin with a new Pre-Trading Period pursuant to Regulation
9x.09. Subsequently, trading will proceed consistently with Exchange Rules and
Regulations.
The Exchange shall inform Exchange Participants without delay of the reduced
time of the trading period.
Appendix 10A
APPENDIX 10A - ELEVATORS IN THE CHICAGO AND BURNS HARBOR SWITCHING DISTRICTS
(WHEAT & OATS)
Following is a listing of the elevators in the Chicago and Burns Harbor
Switching Districts approved as regular for the delivery of Wheat and Oats
through June 30, 2002:
[Download Table]
--------------------------------------------------------------------------------
CAPACITY IN
WAREHOUSE LOCATION BUSHELS
--------------------------------------------------------------------------------
Cargill, Inc. Cargill Burns Harbor 5,473,000
Portage, IN
Chicago & Illinois Chicago 9,156,000
River Marketing LLC
--------------------------------------------------------------------------------
Note: All elevators are Federally licensed.
07/01/00
Appendix 10B
APPENDIX 10B - ELEVATORS IN THE ST. LOUIS AND EAST ST. LOUIS SWITCHING DISTRICTS
(WHEAT)
Following is a listing of the elevators in the St. Louis, East St. Louis and
Alton Switching districts approved as regular for the delivery of Wheat through
June 30, 2002:
[Enlarge/Download Table]
-----------------------------------------------------------------------------------------------------------
CAPACITY IN
WAREHOUSE LOCATION BUSHELS
-----------------------------------------------------------------------------------------------------------
Archer-Daniels-Midland St. Louis Elevator 2,154,000
St. Louis, MO
Cargill Inc. Elevator 2,481,000
East St. Louis, IL
ConAgra Flour Mill Alton, 3,390,000
IL
-----------------------------------------------------------------------------------------------------------
Note: All Elevators listed are Federally licensed.
07/01/00
Appendix 10C
APPENDIX 10C - ELEVATORS IN THE MINNEAPOLIS AND ST. PAUL SWITCHING DISTRICTS
(OATS)
Following is a listing of the elevators in the Minneapolis and St. Paul, MN
Switching Districts which are approved as regular for the delivery of Oats
through June 30, 2002:
[Enlarge/Download Table]
------------------------------------------------------------------------------------------------
CAPACITY IN
WAREHOUSE LOCATION BUSHELS
------------------------------------------------------------------------------------------------
Bunge Corporation Midway Elevator 2,643,000
Minneapolis, MN
Port Bunge Elevator 9,275,000
Savage, MN
Cargill, Inc. Port Cargill 19,522,038
Elevator "C"
Savage, MN
Cenex Harvest States HSC Savage Elevator 641,000
Co-Operatives Savage, MN
Elevator #2 1,400,000
St. Paul, MN
St. Paul Elevator "M" 1,331,000
St. Paul, MN
Calumet Elevator 1,323,000
ConAgra, Inc. Minneapolis, MN
Electric Steel Elevator
Minneapolis, MN 4,579,000
Malt-One Elevator 2,348,000
Minneapolis, MN
Marquette Elevator 3,830,000
Minneapolis, MN
Shakopee Elevator 1,122,000
Shakopee, MN
Delmar #4/Washburn C
General Mills, Inc. Minneapolis, MN 9,636,000
Washburn Elevator 2,400,000
Checkerboard Elevator B
Minneapolis, MN
Washburn D-Elevator T 4,047,000
Minneapolis, MN
Fridley Elevator 4,955,000
Fridley, MN
------------------------------------------------------------------------------------------------
NOTE: ALL ELEVATORS ARE FEDERALLY LICENSED.
11/01/00
APPENDIX 10D
APPENDIX 10D - ELEVATORS IN THE TOLEDO, OHIO SWITCHING DISTRICT (WHEAT)
Following is a listing of the elevators in the Toledo, Ohio Switching District
which are approved as regular for the delivery of Wheat through June 30, 2002:
[Enlarge/Download Table]
-----------------------------------------------------------------------------------------------------
CAPACITY IN
WAREHOUSE LOCATION BUSHELS
-----------------------------------------------------------------------------------------------------
The Andersons Agriculture Group Andersons' Elevator 20,559,000
L.P. Maumee, Ohio
Reynolds Road 983,000
Toledo, Ohio
Riverfront Elevator 7,232,000
Toledo, Ohio
Conant Street Elevator 6,316,000
Maumee, Ohio
Edwin Drive Elevator 6,732,000
Toledo, Ohio
Elevator
ADM/Countrymark, Inc. Toledo, Ohio 9,795,000
Grain Elevator 7,680,000
Ottawa Lake, MI
-----------------------------------------------------------------------------------------------------
NOTE: ALL ELEVATORS ARE FEDERALLY LICENSED.
07/01/00
Appendix 10E
APPENDIX 10E - GRAIN
Beginning with new crop 1993 delivery months, the following maximum storage
rates, as specified in Regulation 1056.01, will be applicable to Chicago Board
of Trade approved elevators regular for the storage of grain:
Wheat: Effective July 1, 1993, the storage rate shall not exceed
15/100 of one cent per bushel per day.
Oats: Effective September 1, 1993, the storage rate shall not
exceed 13/100 of one cent per bushel per day.
The following is a listing of the storage rates effective prior to the
implementation of the maximum rates. Storage rates which are below the maximum
rates will remain in effect after implementation of the maximum rates.
[Enlarge/Download Table]
-------------------------------------------------------------------------------------------------------------------
WAREHOUSE & LOCATION RATE EFFECTIVE DATE
-------------------------------------------------------------------------------------------------------------------
The Andersons
Maumee Elevator 15/100 of a cent July 1, 1993
Maumee, OH per bushel per day
Conant Street 15/100 of a cent July 1, 1998
Toledo, OH per bushel per day
Riverfront Elevator 15/100 of a cent July 1, 1993
Toledo, OH per bushel per day
Edwin Drive 15/100 of a cent July 1, 1998
Toledo, Ohio per bushel per day
Reynolds Road 15/100 of a cent July 11, 1996
Toledo, OH per bushel per day
ADM/Countrymark L.L.C., Inc.
Elevator 15/100 of a cent per bushel April 30, 1998
Toledo, OH per day (Wheat, Corn &
Soybeans)
Ottawa Lake Elevator Ottawa 15/100 of a cent per bushel April 30, 1998
Lake, MI per day
Archer-Daniels-Midland
St. Louis Elevator 10/100 of a cent October 1, 1993
St. Louis, MO per bushel per day
Bunge Corporation 13/100 of a cent September 1, 1993
per bushel per day
Midway Elevator 13/100 of a cent September 1, 1993
Minneapolis, MN per bushel per day
Port Bunge
Savage, MN 13/100 of a cent April 3, 1996
per bushel per day
Cargill, Inc. 15/100 of a cent per bushel per day August 18, 1999
East St. Louis, IL
Cargill Maumee Elevator 15/100 of a cent July 1, 1993
Maumee, OH per bushel per day
Cargill Maumee Elevator 13/100 of a cent September 1, 1993
Toledo, OH per bushel per day
Port Cargill Elevator "C" 15/100 of a cent July 1, 1993
Savage, MN per bushel per day
Cargill Burns Harbor
Portage, IN 10/100 of a cent October 1, 1993
per bushel per day
Cenex/Harvest States Cooperatives
St. Paul Elevator #B 13/100 of a cent September 1, 1993
St. Paul, MN per bushel per day
(Oats)
Harvest States Savage Elevator 13/100 of a cent September 1, 1993
Savage, MN per bushel per day
Elevator M 13/100 of a cent September 1, 1993
St. Paul, MN per bushel per day
(Oats)
-------------------------------------------------------------------------------------------------------------------
Chicago & Illinois River 15/100 of a cent per bushel per day November 1, 1999
Marketing L.L.C.
ConAgra Flour Mill 15/100 of a cent per bushel per day July 1, 1993
Elevator
Alton, IL
ConAgra, Inc.
-------------------------------------------------------------------------------------------------------------------
Appendix 10E
[Enlarge/Download Table]
-------------------------------------------------------------------------------------------------------------------
Electric Steel Elevator 13/100 of a cent September 1, 1993
Minneapolis, MN per bushel per day
Calumet Elevator 13/100 of a cent September 1, 1993
Minneapolis, MN per bushel per day
Malt-one Elevator 13/100 of a cent September 1, 1993
Minneapolis, MN per bushel per day
Marquette Elevator 13/100 of a cent October 4, 2000
Minneapolis, MN per bushel per day
Shakopee Elevator 13/100 of a cent September 24,1994
Shakopee, MN per bushel per day
General Mills, Inc.
Fridley Elevator 13/100 of a cent September 1, 1993
Minneapolis, MN per bushel per day
Washburn Elevator 13/100 of a cent April 20, 1994
Minneapolis, MN per bushel per day
(Oats)
Washburn Elevator 13/100 of a cent September 1, 1993
Checkerboard per bushel per day
Minneapolis, MN Oats)
-------------------------------------------------------------------------------------------------------------------
NOTE: ALL ELEVATORS LISTED ARE FEDERALLY LICENSED.
11/01/00
Appendix 10F
APPENDIX 10F - RECIPROCAL AND INTERMEDIATE SWITCHING CHARGES
REFERENCE GUIDE ONLY - EFFECTIVE MAY 1, 1997
THE FOLLOWING RECIPROCAL AND INTERMEDIATE SWITCHING CHARGES APPLY AT ELEVATORS
REGULAR FOR DELIVERY WITHIN THE CHICAGO, IL AND BURNS HARBOR, IN SWITCHING
DISTRICTS. RATES ARE IN DOLLARS PER CAR UNLESS OTHERWISE INDICATED.
[Enlarge/Download Table]
RESULT AND/OR INTERMEDIATE
ELEVATOR: RECIPROCAL CARRIER: CARRIER AND END RESULT:
--------- ------------------- -----------------------
CARGILL CR OR IHB LINE HAUL DIRECT CONNECTION WITH ALL
OTHER CARRIERS.
BURNS HARBOR, IN RATE OTHER CARRIERS.
--------------------------------------------------------------------------------------------------------------------
CHICAGO & ILLINOIS RIVER IHB - $242.00 PER CAR
MARKETING, L.L.C.
117/TH/ & $166.00 PER CAR (25-CAR)
TORRENCE $ 95.00 PER CAR (50-CAR)
CHICAGO, IL (PRIVATE CARS, CR, NS)
DIRECT CONECTION WITH ALL OTHER CARRIERS
IHB $261.00 PER CAR
$184.00 PER CAR (25-CAR)
$110.00 PER CAR (50-CAR)
(ALL OTHER CARRIERS)
CRL - $187.00 PER CAR
--------------------------------------------------------------------------------------------------------------------
THIS APPENDIX IS ONLY A REFERENCE GUIDE AND SHOULD NOT BE CONSTRUED AS A TRADING
RECOMMENDATION OF THE CHICAGO BOARD OF TRADE. DUE TO THE RAPID CHANGES IN
FREIGHT TARIFFS, WE DO NOT GUARANTEE THIS APPENDIX AS TO ACCURACY OR
COMPLETENESS. FOR CURRENT INFORMATION ON SWITCHING CHARGES CONTACT THE
RESPECTIVE RAIL CARRIER DIRECTLY.
01/01/00
Appendix 10G
APPENDIX 10G - GRAIN LOAD-OUT PROCEDURES
Following is a general outline of procedures for the load-out of grain covered
by Chicago Board of Trade ("CBOT") registered warehouse receipts/shipping
certificates. The procedures are based upon a combination of CBOT rules and
regulations and trade practice. Where applicable, CBOT rules and regulations are
cited.
1. Cancellation of the Warehouse Receipt/Shipping Certificate at CBOT
Registrar's Office.
a. To initiate the load-out process, the receipt/certificate holder,
or owner, requests his clearing firm to cancel the warehouse
receipt/shipping certificate at the CBOT Registrar's Office.
b. The Registrar bills the owner's clearing firm a cancellation fee
of $1 per receipt. (Internal policy of CBOT Registrar's Office.)
2. Surrender of the Cancelled Warehouse Receipt/Shipping Certificate.
a. The next step is for the owner to surrender the cancelled
receipt/certificate to the regular warehouseman/shipper or his
representative agent in Chicago. The agent must be a registered
clearing member of the CBOT, be located in the vicinity of the
CBOT and be available during business hours (except Exchange
holidays). Business hours are 8:00 a.m. - 4:30 p.m., Monday -
Thursday and 8:00 a.m. - 3:00 p.m. on Friday.
b. At this time, the warehouseman/shipper, at his option, may
require the owner to pay storage/premium and insurance charges
that have accumulated up to and including the date of surrender.
(See items 6(a) and (b) below.) The warehouseman's/shipper's
agent shall accept these payments during business hours.
c. At this time, the warehouseman, at his option, may also require
the owner to pay the warehouseman or his agent a load-out fee of
up to 6 cents per bushel. A fobbing charge of 4 cents per bushel
was already paid at the time of delivery of corn and soybean
shipping certificates. (The maximum load-out/fobbing fee, subject
to change, is 6 cents per bushel for receipts and 4 cents per
bushel for certificates. CBOT Regulation 1081.01(11).)
d. If the owner decides against loading out grain, he may notify the
warehouseman's/shipper's agent that warehouse receipts/shipping
certificates are to be re-issued. The warehouseman's/shipper
agent, if requested by the owner, shall obtain the
receipts/certificates from the warehouseman/shipper, and if agent
is notified by 12:00 noon, re-issued receipts shall be
deliverable by 4:00 p.m. the following business day. (Any
reimbursement of expenses for making the grain available for
loading must be mutually accepted by the maker and taker.
Notification of agents is notification of principal. All fees are
a matter between agent and principal.)
3. Arrangement of Transportation Conveyance.
a. Next, the owner arranges for proper conveyance of the grain to be
loaded out with a carrier; the conveyance may be rail cars,
barge, or vessel, and must be clean and ready-to-load.
b. The owner provides the warehouseman/shipper with written loading
orders that identify the vessel, barge, or number of rail cars
that will take delivery of the grain, and that specify the grade
and estimated number of bushels to be loaded.
c. An owner requesting vessel load-out, having surrendered canceled
receipts/certificates and tendered written loading orders to the
warehouseman/shipper, is entitled to the warehouse's/shipper's
current scheduled load-in and load-out lineups, provided the
owner gives to the warehouseman/shipper the identity of the
vessel and the estimated-time-of-arrival no more than 5 calendar
days prior to constructive placement of the vessel.
Appendix 10G
In addition, an owner is entitled to receive updated information,
upon request, on the elevator's/shipping station's scheduled
load-in and load-out lineups.
d. The carrier or its agent notifies the warehouseman/shipper of the
"constructive placement" of the conveyance. The term
"constructive placement" is defined in CBOT Regulations
1081.01(12)A. (1), (2) and (3). Only the warehouseman/shipper can
order the conveyance to the elevator/shipping station for actual
placement for loading.
e. The warehouseman/shipper is not responsible for the failure of
the carrier to present clean, ready-to-load conveyance to the
warehouseman/shipper. (CBOT Regulation 1081.01(12) B.)
4. Request for Grain Inspection or Stevedoring Service.
a. The owner may, at his option and expense, request the
warehouseman/shipper to arrange inspection and weighing service
provided by the Federal Grain Inspection Service ("FGIS").
b. In case of water load-out (barge or vessel), the owner should
request the warehouseman/shipper to arrange stevedoring service.
In this regard, the owner may designate to the
warehouseman/shipper the stevedoring service he would like to
use. The owner is responsible for charges incurred for
stevedoring service.
c. The warehouseman/shipper does not control the availability of the
FGIS and the stevedoring services.
5. Actual Load-Out.
a. The warehouseman/shipper must load-out all conveyances in the
order of their constructive placement. An operator of a regular
facility in Chicago, Burns Harbor, along the Illinois Waterway,
and St. Louis has the obligation of loading grain represented by
warehouse receipts or shipping certificates giving preference to
takers of delivery. (CBOT Regulation 1081.01(12) A.)
b. The warehouseman/shipper informs the owner of the time of loading
completion and the release time of the conveyance to the carrier.
c. The warehouseman/shipper must advise the owner of any load-out
difficulties. Inclement weather may delay loading.
d. The owner should be familiar with the tariff of the
warehouse/shipping station where the load-out is to occur.
6. Final Settlement of All Charges By Invoice
a. The owner pays the warehouseman/shipper storage/premium charges
that have accumulated up to and including the 10th business day
after constructive placement of the conveyance or the date of
loading completion, whichever is earlier. (CBOT Regulation
1081.01(12).) If the owner paid storage/premium charges when he
surrendered the cancelled warehouse receipt/shipping certificate
(see item 2(b) above) he now pays storage/premium charges that
have accumulated since that time as invoiced.
b. The owner pays the warehouseman for the FGIS service and the
stevedoring company for stevedoring service as invoiced.
c. With some exceptions for Burns Harbor delivery, the owner pays
all transportation costs, including switching charges and
demurrage, if any, to the appropriate transportation company.
Appendix 10G
*/ The outline provided above is intended to serve only as a general guide to
grain load-out procedures; certain of the discussed obligations of the
warehouseman and owners may not apply in a particular situation or may be
open to negotiation between the parties. Care has been taken in the
preparation of this outline, but there is no warranty or representation
expressed or implied by the Chicago Board of Trade or its member firms as
to the accuracy or completeness of the material herein. In particular, CBOT
rules and regulations may be revised from time accordingly, current rules
and regulations, if applicable, should be consulted when there is a
question about load-out. Please be advised that the U.S. Warehouse Act, as
amended, a state law may also apply to, or govern, a particular situation.
If you have legal questions concerning load-out, we recommend that you
consult your legal counsel. (08/01/00)
Appendix 10C A
APPENDIX 10C A - CORN AND SOYBEAN SHIPPING STATIONS
Following is a listing of the shipping stations approved as regular for the
delivery of Corn and Soybeans for the period through June 30, 2002:
[Enlarge/Download Table]
-------------------------------------------------------------------------------------------------------------------
BOTCC Code Firm Location Mile Approved Daily Loading Max. Certs Location
Marker Capacity Rate (bu/day) Differential
(bu) (cents/bu)
1750 Cargill, Inc. Burns 340 5,473,000 165,000 1,094 par
Harbor, IN
1705 Chicago & Illinois Chicago, IL 329.4R 7,680,000 165,000 1,536 par
River Marketing, LLC
1715 Louis Dreyfus Lockport, IL 292.8R 204,000 55,000 330 2
1751 Cargill, Inc. Lockport, IL 292.5R 574,000 110,000 660 2
1758 Cargill, Inc. Morris, IL 263.3R 124,000 110,000 660 2
1752 Louis Dreyfus Morris, IL 263.0R 304,000 55,000 330 2
1730 ADM/Growmark River Morris-E, IL 263.0R 587,000 110,000 660 2
Systems, Inc.
1731 ADM/Growmark River Morris-W, IL 262.9R 230,000 110,000 660 2
Systems, Inc.
1711 CIRM Seneca, IL 253 THROUGH 55,000 330 2
PUT
1759 Cargill, Inc. Seneca, IL 252.5R 846,000 110,000 660 2
1732 ADM/Growmark River Ottawa-N, IL 241.8R 988,000 110,000 660 2 1/2
Systems, Inc.
1753 Cargill, Inc. Ottawa, IL 238.5L 880,000 165,000 990 2 1/2
1733 ADM/Growmark River Ottawa-S, IL 236.9L 107,000 110,000 660 2 1/2
Systems, Inc.
1765 Maplehurst Farms, Ottawa, IL 236.4R 0 55,000 330 2 1/2
Inc.
1701 Consolidated Grain Utica, IL 229L 681,000 55,000 330 2 1/2
and Barge Co.
1714 Louis Dreyfus Utica, IL 229L THROUGH PUT 110,000 660 2 1/2
1734 ADM/Growmark River La Salle, IL 223.3R 84,000 110,000 660 2 1/2
Systems, Inc.
1702 Consolidated Grain Peru, IL 222.9R 0 55,000 330 2 1/2
and Barge Co.
1713 Louis Dreyfus Peru, IL 222.9R THROUGH PUT 55,000 330 2 1/2
1735 ADM/Growmark River Spring 218.4R 109,000 110,000 660 2 1/2
Systems, Inc. Valley, IL
1754 Cargill, Inc. Spring 218.3L 1,433,000 165,000 990 2 1/2
Valley, IL
1736 ADM/Growmark River Hennepin, IL 207.7L 500,000 110,000 660 2 1/2
Systems, Inc.
1760 Cargill, Inc. Hennepin, IL 207.5L 110,000 110,000 660 2 1/2
1703 Consolidated Grain Hennepin, IL 207.4R 416,000 55,000 330 2 1/2
and Barge Co.
1712 Louis Dreyfus Hennepin, IL 207.4R THROUGH PUT 110,000 660 2 1/2
1737 ADM/Growmark River Henry, IL 195.8R 552,000 55,000 330 2 1/2
Systems, Inc.
1738 ADM/Growmark River Lacon, IL 189.5L 199,000 110,000 660 2 1/2
Systems, Inc.
1761 Cargill, Inc. Lacon, IL 189.3L 487,000 110,000 660 2 1/2
1739 ADM/Growmark River Chillicothe, 180.5R 172,000 55,000 330 2 1/2
Systems, Inc. IL
1740 ADM/Growmark River Creve Coeur, 158.1L 1,401,000 110,000 660 3
Systems, Inc. IL
1741 ADM/Growmark River Peoria, IL 161.4R 1,931,000 110,000 660 3
Systems, Inc.
1700 Cargill, Inc./AGRI Pekin, IL 152.8R 0 165,000 990 3
Grain Marketing
1720 Tomen America Pekin, IL 152.2L 732,000 110,000 660 3
1716 Granite Grain Pekin, IL 151.2L 0 275,000 1,650 3
-------------------------------------------------------------------------------------------------------------------
Appendix 10C A
(11/01/00)
Appendix 10S A
APPENDIX 10S A - SOYBEAN ONLY SHIPPING STATIONS
See Appendix 10C A - CORN AND SOYBEAN SHIPPING STATIONS for shipping stations
approved as regular for the delivery of Soybeans above Illinois River Mile
Marker 151.
Following is a listing of additional shipping stations approved as regular for
the delivery of Soybeans only for the period through June 30, 2002:
[Enlarge/Download Table]
---------------------------------------------------------------------------------------------------------------------------
BOTCC Firm Location Mile Approved Daily Max. Location
Code Marker Capacity Loading Certs Differential
(bu) Rate (cents/bu)
(bu/day)
1755 Cargill, Inc. Havana-N, IL 119.9L 575,000 55,000 330 3 1/2
1766 Prairie Central Co-op Havana-N, IL 119.9L THROUGH 55,000 330 3 1/2
Inc. PUT
1762 Cargill, Inc. Havana-S, IL 119.8L 738,000 55,000 330 3 1/2
1742 ADM/Growmark River Havana-N, IL 119.6L 1,093,000 165,000 990 3 1/2
Systems, Inc.
1743 ADM/Growmark River Havana-S, IL 119.3L 178,000 110,000 660 3 1/2
Systems, Inc.
1763 Cargill, Inc. Beardstown, IL 88.1L 439,000 55,000 330 3 1/2
1744 ADM/Growmark River Beardstown, IL 91.0R 2,757,000 110,000 660 3 1/2
Systems, Inc.
1756 Cargill, Inc. Merdedosia, IL 71.3L 962,000 110,000 660 3 1/2
1745 ADM/Growmark River Naples, IL 66.1L 310,000 110,000 660 3 1/2
Systems, Inc.
1706 Zen-Noh Grain Corp. Naples, IL 65L THROUGH 55,000 330 3 1/2
PUT
1704 Consolidated Grain Naples, IL 65L 6,247,000 55,000 330 3 1/2
and Barge Co.
1746 ADM/Growmark River Florence, IL 57.2R 143,000 55,000 330 3 1/2
Systems, Inc.
1757 Cargill, Inc. Florence, IL 55.3R 1,855,000 165,000 990 3 1/2
1717 Granite Grain Granite City, IL UM 185.5L 0 55,000 330 6
1747 ADM/Growmark River St. Louis, MO UM 184R 2,154,000 220,000 1,320 6
Systems, Inc.
1764 Cargill, Inc. E. St. Louis, IL UM 179L 2,481,000 110,000 660 6
1710 Peavey Co., a Sauget, IL UM 177L 288,000 110,000 660 6
ConAgra Trade
Group company
1718 Granite Grain Cahokia, IL UM 176.5L 0 110,000 660 6
---------------------------------------------------------------------------------------------------------------------------
(07/01/00)
Appendix 11A
APPENDIX 11A - CRUDE SOYBEAN OIL
Following is a listing of the firms approved for the delivery of Crude Soybean
Oil through June 30, 2002:
[Enlarge/Download Table]
-------------------------------------------------------------------------------------------------
MAXIMUM
RECEIPTS
FIRM/FACILITIES REGULAR SPACE ALLOWED TO
(POUNDS) ISSUE
-------------------------------------------------------------------------------------------------
AG PROCESSING, INCORPORATED
Dawson, MN 26,324,000 438
Eagle Grove, IA 20,000,000 333
Emmetsburg, IA 10,000,000 166
Fort Dodge, IA 13,000,000 216
Manning, IA 9,000,000 150
Mason City, IA 36,000,000 600
Omaha, NE 40,000,000 666
Sergeant Bluff, IA 31,500,000 525
Sheldon, IA 19,200,000 320
St. Joseph, MO 24,000,000 400
ARCHER DANIELS MIDLAND COMPANY
Decatur, IL 180,000,000 3,000
Des Moines, IA 40,600,000 676
Frankfort, IN 39,000,000 650
Galesburg, IL 11,400,000 190
Granite City, IL 40,000,000 666
Lincoln, NE 27,000,000 450
Mankato, MN 51,000,000 850
Mexico, MO 43,000,000 716
N. Kansas City, MO 42,000,000 700
Quincy, IL 54,500,000 908
Taylorville, IL 29,900,000 498
BUNGE CORPORATION
Emporia, KS 36,600,000 950
Logansport, IN 62,000,000 1,033
CARGILL, INCORPORATED
Ackley, IA 160,000,000 2,666
Bloomington, IL 3,900,000 65
Buffalo, IA 36,800,000 613
Cedar Rapids, IA 1,920,000 32
Cedar Rapids, (E), IA 9,300,000 155
Des Moines, IA 8,490,000 141
Iowa Falls, IA 20,000,000 333
Kansas City, MO 7,000,000 116
Lafayette, IN 9,000,000 150
CENTRAL SOYA COMPANY, INC.
Decatur, IN 80,000,000 1,333
Gibson City, IL 50,325,000 838
HONEYMEAD PRODUCTS COMPANY
Mankato, MN 6,000,000 100
INCOBRASA INDUSTRIES, LTD.
Gilman, IL 37,500,000 625
LAUHOFF GRAIN COMPANY
Danville, IL 91,500,000 1,525
SOUTH DAKOTA SOYBEAN PROCESSORS, INC.
Volga, SD 138,000,000 2,300
-------------------------------------------------------------------------------------------------
12/01/00
APPENDIX 11B - SOYBEAN OIL DELIVERY DIFFERENTIALS IN CENTS PER 100 LBS.
---------------------------------------------------------------------------
DELIVERY TERRITORY/WAREHOUSE LOCATION DIFFERENTIALS
---------------------------------------------------------------------------
ILLINOIS TERRITORY
Bloomington, IL PAR
Danville, IL PAR
Decatur, IL PAR
Galesburg, IL PAR
Gibson City, IL PAR
Gilman, IL PAR
Granite City, IL PAR
Quincy, IL PAR
Taylorville, IL PAR
EASTERN TERRITORY
Decatur, IN (30)
Frankfort, IN (30)
Indianapolis, IN (30)
Lafayette, IN (30)
Logansport, IN (30)
EASTERN IOWA TERRITORY
Ackley, IA (20)
Buffalo, IA (20)
Cedar Rapids, IA (20)
Cedar Rapids (E), IA (20)
Des Moines, IA (20)
Iowa Falls, IA (20)
Mason City, IA (20)
SOUTHWEST TERRITORY
Kansas City, MO (15)
Mexico, MO (15)
N. Kansas City, MO (15)
St. Joseph, MO (15)
Emporia, KS (15)
NORTHWEST TERRITORY
Eagle Grove, IA (45)
Emmetsburg, IA (45)
Fort Dodge, IA (45)
Manning, IA (45)
Sergeant Bluff, IA (45)
Sheldon, IA (45)
Dawson, MN (45)
Mankato, MN (45)
Lincoln, NE (45)
Omaha, NE (45)
Volga, SD (45)
---------------------------------------------------------------------------
DIFFERENTIALS FOR SOYBEAN OIL DELIVERY MONTHS JANUARY THRU DECEMBER 2001
Illinois Eastern Eastern Iowa Southwest Northwest
Par (20) (20) (5) (55)
( ) - Differentials enclosed by parentheses ( ) are discounts.
10/01/00
APPENDIX 12A - SOYBEAN MEAL
Following is a listing of the firms approved for the delivery of Soybean Meal
through June 30, 2002:
[Enlarge/Download Table]
----------------------------------------------------------------------------------------
DAILY RATE MAXIMUM
FIRM/FACILITY OF LOADING CERTIFICATES
(TONS) BONDED TO ISSUE
----------------------------------------------------------------------------------------
Ag Processing Incorporated
Eagle Grove, IA 1,600 1048*
Manning, IA 600
Mason City, IA 700
Emmetsburg, IA 700
Sergeant Bluff, IA 1,000
Sheldon, IA 840
St. Joseph, MO 600
Archer-Daniels-Midland
Clarksdale, MS 500 92
Decatur, IL 2,000 345
Des Moines, IA 1,500 253
Fostoria, OH 600 103
Frankfurt, IN 800 128
Galesburg, IL 400 70
Helena, AR 748 122
Little Rock, AR 400 78
Mexico, MO 700 115
N. Kansas City, MO 800 140
Quincy, IL 2,000 349
Taylorville, IL 700 125
Bunge Corporation
Cairo, IL 2,000 300
Council Bluffs, IA 3,500 725
Decatur, AL 960 144
Marks, MS 1200 330
Cargill, Incorporated
Bloomington, IL 600 1667*
Cedar Rapids (E), IA 1,500
Des Moines, IA 1,100
Guntersville, AL 900
Iowa Falls, IA 1,500
Kansas City, MO 1,500
Lafayette, IN 850
Sioux City, IA 1,200
Sidney, OH 1,500
Central Soya Company, Incorporated
Bellevue, OH 1,100 1630*
Decatur, IN 2,000
Gibson City, IL 800
Morristown, IN 1000
Consolidated Grain & Barge Company
Mt. Vernon, IN 1,000 210
Lauhoff Grain Company
Danville, IL 960 1,144
Owensboro Grain Company
Owensboro, KY 1,600 553
Riceland Foods, Incorporated
Stuttgart, AR 325 98
----------------------------------------------------------------------------------------
*total number of certificates allowed to issue for all facilities combined
07/01/00
APPENDIX 12B - SOYBEAN MEAL LOCATIONS APPROVED FOR DELIVERY AND THEIR DISCOUNTS
OR PREMIUMS
CENTRAL TERRITORY - AT CONTRACT PRICE
Bloomington, IL
Cairo, IL
Danville, IL
Decatur, IL
Galesburg, IL
Gibson City, IL
Quincy, IL
Taylorville, IL
Owensboro, KY
EASTERN IOWA TERRITORY - $4.50 DISCOUNT
Cedar Rapids, (East), IA
Des Moines, IA
Iowa Falls, IA
MIDSOUTH TERRITORY - $6.50 PREMIUM
Clarksdale, MS
Decatur, AL
Guntersville, AL
Helena, AR
Little Rock, AR
Marks, MS
Stuttgart, AR.
MISSOURI TERRITORY - AT $1.00 PREMIUM
Kansas City, MO
Mexico, MO
N. Kansas City, MO
St. Joseph, MO
NORTHERN TERRITORY - $4.00 DISCOUNT
Eagle Grove, IA
Council Bluffs, IA
Emmetsburg, IA
Manning, IA
Mason City, IA
Sergeant Bluff, IA
Sheldon, IA
Sioux City, IA
NORTHEAST TERRITORY -$1.50 PREMIUM
Bellevue, OH
Decatur, IN
Fostoria, OH
Frankfurt, IN
Appendix 12B
NORTHEAST TERRITORY -$1.50 PREMIUM (Continued)
Lafayette, IN
Morristown, IN
Mt. Vernon, IN
Sidney, OH
DIFFERENTIALS FOR SOYBEAN MEAL DELIVERY MONTHS JANUARY THRU DECEMBER 2001
Central Northeast Mid South Missouri Eastern Iowa Northern
Par +$1.50 +$6.50 +$1.00 -$4.50 -$4.00
09/01/00
APPENDIX 14A - BRANDS APPROVED FOR DELIVERY AGAINST SILVER CONTRACTS
[Enlarge/Download Table]
---------------------------------------------------------------------------------------------------------------------------
PRODUCER REFINERY BRAND MARK
---------------------------------------------------------------------------------------------------------------------------
American Metal Climax, Inc. Carteret, NJ DRW
Anaconda Raritan, NJ UMS Co. & or Raritan
ASARCO Incorporated Perth Amboy, NJ ASARCO-PERTH AMBOY
Baltimore, MD ASARCO-BALTIMORE
Selby, CA ASARCO-SELBY
Selby, CA SELBY GOLD & SILVER REFINERY, SAN
FRANCISCO, CA
Amarillo, TX ASARCO SILVER, AMARILLO, TX
Bunker Hill Company Kellogg, ID BUNKER HILL
CCR Canada/Noranda Inc. Quebec, Canada CCR Canada
Cerro Corporation Oroya, Peru C de P
Cobalt Refinery Division Cobalt, Ontario, Canada CRK
Kam-Kotia Mines Ltd.
Cominco Ltd. Trail B.C. Tadanac
Comptoir Lyon-Alemand-Louyot Noisy Le Sec, France COMPTOIR-LYON-ALEMAND, LOUYOT-PARIS
Degussa Hanau, Federal Republic of Germany DEGUSSA
Empresa Minera Del Centro Peru La Oroya - Peru C.P. Industria - Peruana
Engelhard Industries, Inc. Newark, NJ E
Engelhard Industries, Ltd. Gloucestershire, England ENGELHARD, LONDON
Inco Limited Copper Cliff, Ontario, Canada ORC
Industrial Minera Mexico, S.A. Monterrey, Nuevo Leon, Mexico IMM-MONTERREY
Johnson Matthey Limited Brampton, Ontario Canada JM CANADA & JM&M LTD CANADA
Johnson Matthey Chemicals Brimsdown, Middlesex, England JOHNSON MATTHEY LONDON
Johnson Matthey Refining Co. Salt Lake City, UT JMRI USA ASSAY OFFICE
Kennecott Garfield, UT KUE
Metallurgie Hoboken-Overpelt, Hoboken, Belgium HOBOKEN
S.A.
Mitsubishi Metal Corporation Osaka, Japan Mitsubishi
Norddeutsche Affinerie Hamburg, W. Germany N (number) A
Rosenthal & Company 1/ New York, New York RoCo
Sheffield Smelting Company, Sheffield, England THE SHEFFIELD SMELTING CO. LTD.
Ltd., The SHEFFIELD, ENGLAND
Spiral Metal Co., Inc. 2/ South Amboy, NJ S-M
Sunshine Mining Company Kellogg, ID SUNSHINE
U.S. Assay Office New York, New York Seal of the U.S.
San Francisco, CA
U.S. Mint Philadelphia, PA Seal of the U.S.
Valcambi, S.A. Balerna, Switzerland VALCAMBI SA CHI
---------------------------------------------------------------------------------------------------------------------------
1/ Bars must be accompanied by a certificate of analysis of an official
assayer showing a silver fineness of not less than 999.
2/ Bars may be delivered only if there is tendered in addition to the
customary documents:
- An affidavit or other suitable documentary evidence
establishing that the silver was produced prior to January 1, 1972, or
- An assay certificate of an independent assayer in a form
acceptable to the Exchange.
APPENDIX 14B - VAULTS APPROVED FOR THE STORAGE OF SILVER
The following is a listing of vaults approved for the storage of SILVER through
June 30, 2002:
[Enlarge/Download Table]
---------------------------------------------------------------------------------------------
Chicago Vaults Regular for 1,000 and 5,000 Ounce Silver
STORAGE CAPACITY
VAULT (Troy ounces)
Bank One N.A. 2,800,000
Chicago, IL
Harris Trust and Savings Bank 15,000,000
Chicago, IL
---------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------
New York Vaults Regular for 5,000 Ounce Only
STORAGE CAPACITY
VAULT (Troy ounces)
HSBC Bank USA 150,000,000
New York, NY
---------------------------------------------------------------------------------------------
07/01/00
APPENDIX 14C - COMMODITY EXCHANGE, INC. LICENSED DEPOSITORIES FOR SILVER
[Download Table]
------------------------------------------------------------------------------
DEPOSITORY FACILITIES
------------------------------------------------------------------------------
BANKERS TRUST COMPANY
16 Wall Street 16 Wall Street
New York, N.Y. 10005 New York, N.Y. 10005
(Orders: (212) 618-3661)
IRON MOUNTAIN DEPOSITORY
26 Broadway 26 Broadway
New York, N.Y. 10004 New York, N.Y. 10004
(Orders: (212) 912-8530)
MORGAN GUARANTY TRUST COMPANY
60 Wall Street 15 Broad Street
New York, N.Y. 10260 New York, N.Y. 10006
(Orders: (212) 648-4160)
522 Fifth Avenue
New York, N.Y. 10036
HSBC BANK USA
450 Fifth Avenue 450 Fifth Avenue
New York, N.Y. 10018 New York, N.Y. 10018
(Orders: (212) 525-6439)
SWISS BANK CORPORATION
4 World Trade Center 4 World Trade Center
Box 395, Church Street Station New York, N.Y. 10048
New York, N.Y. 10048
(Orders: (212) 574-3644)
------------------------------------------------------------------------------
01/01/00
APPENDIX 14D - SILVER VAULT CHARGES
Withdrawal and storage charges of the approved vaults in connection with the
storage of SILVER are as follows:
[Download Table]
--------------------------------------------------------------------------------
1,000 OZ. SILVER
--------------------------------------------------------------------------------
Bank One
--------
. storage charge: $0.08 per bar per calendar day
. withdrawal charge: 1-13 bars, $100.00
13 or more bars, $8.00 per bar
Harris Trust and Savings Bank
-----------------------------
. storage charge: $0.08 per bar per day
. withdrawal charge: $13.50 per bar
($100.00 minimum charge)
. conversion fee: $10.00 per receipt
--------------------------------------------------------------------------------
All storage charges on 1,000 oz. silver contract are to be paid on an annual
basis.
[Download Table]
--------------------------------------------------------------------------------
5,000 OZ. SILVER
--------------------------------------------------------------------------------
Bank One
--------
. storage charge: $0.08 per bar per calendar day
. withdrawal charge: 1-13 bars, $100.00
13 or more bars, $8.00 per bar
Harris Trust and Savings Bank
-----------------------------
. storage charge: $0.40 per bar per day
. withdrawal charge: $67.50 per contract
. conversion fee: $25.00 per receipt ($100.00 minimum
charge)
HSBC Bank USA
-------------
. storage charge: $18.50 per contract per month
. withdrawal charge: $65.00 per contract
. conversion fee: $5.00 per receipt
--------------------------------------------------------------------------------
01/01/00
APPENDIX 14E - OFFICIAL ASSAYERS
Ledoux & Company
359 Alfred Avenue
Teaneck, New Jersey 07666
Tel. (201) 837-7160
International Testing Laboratories
580 Market Street
Newark, New Jersey 07105
Tel. (201) 589-4772
Appendix 15A
APPENDIX 15A - BRANDS APPROVED FOR DELIVERY AGAINST
GOLD CONTRACTS
BRAND: Argor S.A. [LOGO OF ARGOR]
REFINER: Argor S.A.
Via C. Cattaneo
Chiasso Switzerland
PARENT: Union Bank of Switzerland
Bahnhofstrasse 45
8021 Zurich Switzerland
BRAND: ASARCO (100 oz. Gold only) [LOGO OF ASARCO]
REFINER: ASARCO INCORPORATED
Amarillo TX
PARENT: ASARCO Incorporated
120 Broadway
New York NY 10005
BRAND: Baker [LOGO OF BAKER]
REFINER: Engelhard Industries Division
429 Delancy Street
Newark NJ 07105
PARENT: Engelhard Minerals and Chemicals Corporation
299 Park Avenue
New York NY 10017
Appendix 15A
BRAND: Canadian Copper Refiners Ltd. [LOGO OF CCR]
REFINER: Canadian Copper Refiners Ltd.
Montreal East
Quebec Canada
PARENT: Noranda
P.O. Box 45
Commerce Court West
Toronto Ontario
Canada M5L 1B6
BRAND: Casa Da Moeda Do Brasil - CMB (Kilo Gold Only) [LOGO OF CMB]
REFINER: Casa Da Moeda Do Brasil - CMB
Rua Rene' Bitencourt, no 371
Distrito Industrial de Santa Cruz
CEP: 23.500 - Rio de Janeiro - RJ/Brasil
PARENT: Casa Da Moeda Do Brasil - CMB
Rua Rene' Bitencourt, no 371
Distrito Industrial de Santa Cruz
CEP: 23.500 - Rio de Janeiro - RJ/Brasil
BRAND: Compagnie des Metaux Precieux (CMP) [LOGO OF CMP]
REFINER: Compagnie des Metaux Preciuex S.A.
75, Boulevard P.V. Couturier
942000 IVRY-France
PARENT: Swiss Bank Corporation
Paradeplatz
8001 Zurich Switzerland
Appendix 15A
BRAND: Comptoir Lyon-Alemand Louyot [LOGO OF COMPTOIR]
Comptoir Lyon-Alemand Louyot
41 Rue de Paris
93130 NOISY LE SEC
France
PARENT: Comptoir Lyon-Alemand Louyot
13 Rue de Montmorency
75139 Paris Cedex 03 France
BRAND: Credit Suisse [LOGO OF CREDIT SUISSE]
REFINER: Valcambi
6828 Balerna Switzerland
PARENT: Swiss Credit Bank
8021 Zurich Switzerland
BRAND: Degussa [LOGO OF DEGUSSA]
REFINER: Degussa
Metallwerk Wolfgang
6450 Hanau
Stadtteil Wolfgang
PARENT: Degussa
6000 Frankfurt (Main) 1
Weissfrauenstrasse 9
Federal Republic of
Germany
Appendix 15A
BRAND: Degussa Canada Ltd. [LOGO OF DEGUSSA]
REFINER: Degussa Canada Ltd.
4261 Mainway Drive
Burlington, Ontario
L7R 3Y8, Canada
PARENT: Degussa AG of Frankfurt
Federal Republic of Germany
BRAND: DRW (100 oz. Gold only) [LOGO OF DRW]
REFINER: United States Metal Refining Company
Carteret NJ
PARENT: AMAX Inc.
200 Park Avenue
New York NY 10017
BRAND: Engelhard and Engelhard with Trade Mark [LOGO OF ENGELHARD]
REFINER: Engelhard Industries of Canada Ltd.
512 King Street East
Toronto Ontario M5A 1M2 Canada
PARENT: Engelhard Industries of Canada Ltd.
512 King Street East
Toronto Ontario M5A 1M2 Canada
Appendix 15A
BRAND: Engelhard (logo)
Engelhard E (frank) [LOGO OF ENGLEHARD]
REFINER: Engelhard Industries Division
429 Delancy Street
Newark NJ 07974
PARENT: Engelhard Minerals and Chemicals
Corporation
299 Park Avenue
New York NY 10017
BRAND: Engelhard - London [LOGO OF ENGLEHARD INDUSTRIES]
REFINER: Engelhard Industries Ltd.
Cox Lane Chessington
Surrey England
PARENT: Engelhard Industries Ltd.
St. Nicholas House
St. Nicholas Road
Sutton Surrey England
BRAND: HH Handy & Harman [LOGO OF HANDY & HARMAN]
REFINER: Handy & Harman
Frank Mossberg Drive
Attleboro MA 02703
PARENT: Handy & Harman
850 Third Avenue
New York NY 10022
Appendix 15A
BRAND: Homestake Mining Company [LOGO OF HOMESTAKE MINING]
REFINER: Homestake Mining Company of California
215 West Main
Lead, SD 57754-1603
PARENT: Homestake Mining Company
of California
215 West Main
Lead, SD 57754-1603
BRAND: Johnson Matthey London [LOGO OF JOHNSON LONDON]
REFINER: Johnson Matthey Chemicals Ltd.
Orchard Road
Royston Hertfordshire SG8 5HE
England
PARENT: Johnson Matthey Chemicals Ltd.
Stockingswater Lane
Brimsdown Enfield
Middlesex EN 37PW England
BRAND: Johnson Matthey Canada [LOGO OF JOHNSON LTD]
REFINER: Johnson Matthey Limited
130 Glidden Road
Brampton Ontario L6W 3M8
PARENT: Johnson Matthey 7 Co., Ltd.
15 King Street
London EC2 England
Appendix 15A
BRAND: Johnson Matthey Inc., Salt Lake City Utah
REFINER: Johnson Matthey Inc. [LOGO OF JOHNSON INC.]
4601 West 2100 South
Salt Lake City, Utah 84120-1221
PARENT: Precious Metals Division of Johnson Matthey PLC
BRAND: Matthey Bishop USA [LOGO OF MATHEY BISHOP USA]
REFINER: Matthey Bishop, Inc.
Piney Hollow Road
Winslow NJ
PARENT: Matthey Bishop, Inc.
Malvern PA 19355
BRAND: Metallurgie Hoboken Overpelt [LOGO OF MHO]
REFINER: Metallurgie Hoboken Overpelt
Hoboken Belgium
PARENT: Metallurgie Hoboken Overpelt S.A.
Adolf Greinerstraat 14
B-2710 Hoboken Belgium
Appendix 15A
BRAND: Metaux Precieux S.A. Neuchatel [LOGO OF SWISS BANK CO]
REFINER: Metaux Precieux S.A.
Avenue due Vignoble 2
CH - 2000 Neuchatel Switzerland
PARENT: Swiss Bank Corporation
Paradeplatz 8001 Zurich, Switzerland
BRAND: Mitsubishi [LOGO OF MITSIBISHI]
REFINER: Osaka Refinery of Mitsubishi
Metal Corporation
Kita-ku Osaka Japan
PARENT: Mitsubishi Metal Corporation
#5-2 Ohte-machi 1-Chome
Chiyoda-ku Tokyo Japan
BRAND: Norddeutsche Affinerie (N.A.) [LOGO OF NA]
REFINER: Norddeutsche Affinerie
Hovestrasse 50
2000 Hamburg 28 West Germany
PARENT: Norddeutsche Affinerie
Alsterterrasse 2
Postfach 67 2000 Hamburg 36
West Germany
Appendix 15A
BRAND: The Royal Canadian Mint [LOGO OF ROYAL CANADA MINT]
REFINER: The Royal Canadian Mint
PARENT: The Roybal Canadian Mint
320 Sussex
Drive
Ottawa Ontario Canada K1A OG8
BRAND: Sheffield Smelting Co., Ltd.
REFINERS: -Sheffield Smelting Co., Ltd.
(1) Cox Lane Chessington (1) [LOGO OF SHEFFIELD SMELTING]
Surrey England
(2) -Engelhard Industries Division (2) [LOGO OF SHEIFFIELD]
Engelhard Minerals & Chemicals Corp.
430 Mountain Avenue
Murray Hill NJ 07974
Appendix 15A
(3) -Engelhard Industries of Canada [LOGO OF ENGLEHARD IN]
512 King Street East
Toronto 248 Canada
PARENT: Engelhard Industries Ltd.
St. Nicholas House
St. Nicholas Road
Sutton Surrey SM1 1EH England
BRAND: Societe de Banque Suisse (SBS) [LOGO OF SBS]
REFINER: Metaux Precieux S.A.
CH-2000
Neuchatel 9 Switzerland
(also Le Locle Switzerland)
PARENT: Swiss Bank Corporation
Paradeplatz
8001 Zurich Switzerland
BRAND: Tanaka [LOGO OF TANAKA]
REFINER: Hiratsuka Works No. 2
Tanaka Kikinzoku Kogyo K. IK. 2-14
Nagatoro Hiratsuka Kanagawa
Prefecture 254 Japan
PARENT: Tanaka Kikinzoku Kogyo K. IK.
6-6 Nihonbashi Kayabacho 2-Chome
Chuo-ku Tokyo 103 Japan
Appendix 15A
BRAND: Valcambi [LOGO OF VALCAMBI]
REFINER: Valcambi, S.A.
1628 Balerna, Switzerland
PARENT: Swiss Credit Bank
Paradeplatz
8000 Zurich Switzerland
Please Note: Brands are approved on both the one kilo and 100 ounce Gold
contract unless otherwise indicated.
APPENDIX 15B - VAULTS APPROVED FOR THE STORAGE OF GOLD
The following is a listing of vaults approved for the storage of GOLD through
June 30, 2002:
--------------------------------------------------------------
STORAGE CAPACITY
VAULT (Troy ounces)
--------------------------------------------------------------
Bank One N.A. 500,000
Chicago, IL
--------------------------------------------------------------
Harris Trust and Savings Bank 745,000
Chicago, IL
--------------------------------------------------------------
HSBC Bank USA 5,000,000
New York, NY
--------------------------------------------------------------
07/01/00
APPENDIX 15C - GOLD VAULT CHARGES
Withdrawal and storage charges of the approved vaults in connection with the
storage of GOLD are as follows:
Bank One
--------
. storage charge of $.18 per calendar day per contract (Kilo/100 oz.)
. withdrawal charge of $10.00 per contract (Kilo/100 oz.)
. conversion fee at $8.00 per receipt (Kilo/100 oz.)
Harris Bank and Trust Company
-----------------------------
. storage charge of $.10 per day per contract (Kilo)
. withdrawal charge of $10.00 per contract (Kilo)
. storage charge of $.20 per day per contract (100 ounce)
. withdrawal charge of $15.00 per contract (100 oz.)
. conversion fee of $8.00 per receipt (Kilo/100 oz.)
HSBC Bank USA
-------------
. storage charge of $4.00 per month per contract (Kilo)
. withdrawal charge of $8.00 per contract (Kilo)
. replacement receipt charge of $5.00 (Kilo)
. storage charge of $7.00 per month per contract (100 oz.)
. withdrawal charge of $15.00 per contract (100 oz.)
. replacement receipt charge of $5.00 (100 oz.)
NOTE: ALL STORAGE CHARGES MUST BE PAID ON QUARTERLY BASIS.
01/01/00
APPENDIX 15D - OFFICIAL ASSAYERS
Ledoux & Company
359 Alfred Avenue
Teaneck, New Jersey 07666
Tel. (201) 837-7160
International Testing Laboratories
580 Market Street
Newark, New Jersey 07105
Tel. (201) 589-4772
APPENDIX 15E - CHICAGO BOARD OF TRADE APPROVED SOURCES AND VAULTS
Asarco Incorporated
P.O. Box 4500
Amarillo, Texas 79105
Bank of Nova Scotia
44 Kind Street, West
Toronto, Ontario CANADA
Brink's France Ltd.
64/66 Rue de Khefir
94, LaSenia, France
Canadian Imperial Bank of Commerce
Commerce Court West
Toronto, Ontario CANADA
Compagnie des Metaux Precieux
75, Boulevard P. V. Couturier
94200 Ivry
FRANCE
Engelhard Industries Division
of Engelhard Minerals & Chemicals
Corporation
429 Delancy Street
Newark, New Jersey 07974
Engelhard Industries Ltd.
Cox Lane
Chessington
Surrey
ENGLAND
Engelhard Industries of Canada Ltd.
521 King Street, East
Toronto, Ontario M5A 1M2
CANADA
Handy & Harman
525 Nuber Avenue
Mount Vernon, NY 10550
Harris Bank and Trust Company (Vault)
111 West Monroe Street
Chicago, IL 60690
Iron Mountain Depository Corporation (Vault)
26 Broadway
New York, NY 10004
Appendix 15E
Johnson Matthey Bankers Ltd.
73-84, Hatton Garden
London ECI
ENGLAND
Johnson Matthey Chemicals Ltd.
Orchard Road
Royston Hertfordshire
ENGLAND
Johnson Matthey Limited
130 Glidden Road
Brampton, Ontario L6W 3M8
CANADA
Matthey Bishop, Inc.
Piney Hollow Road
Winslow, New Jersey
Matthey Bishop, Inc.
Malvern, Pennsylvania 91355
Metallurgie Hoboken-Overpelt
Adolf Greinerstraat 14
B-2710 Hoboken, Belgium
Mocatta & Goldsmid Ltd. (Vault)
Park House
16 Finsbury Circus
London, EC2M 7DA
ENGLAND
N.M. Rothschild & Sons Limited
New Court
St. Swithin's Lane
London, EC4P 4DU
ENGLAND
HSBC Bank USA
1 West 39th Street-SC2 Level
New York, NY 10018
Samuel Montagu & Co. Limited
114 Old Broad Street
London, EC2P 2HY
ENGLAND
Sharps Pixley & Co. Ltd.
34 Line Street
London, EC3M 7LX
ENGLAND
Swiss Bank Corporation
120 Broadway
New York, NY 10018
Swiss Bank Corporation
Paradeplatz
800 Zurich
SWITZERLAND
Swiss Credit Bank
Paradeplatz 8
8001 Zurich
SWITZERLAND
Appendix 15E
Credit Suisse
100 Wall Street
New York, NY 10005
Union Bank of Switzerland
Bahnofstrasse 45
8021 Zurich
SWITZERLAND
United States Metals Refining Company
Carteret, New Jersey
Zurich Bonded Warehouse Co., Ltd.
Kloten Airport
Zurich
SWITZERLAND
07/01/00
APPENDIX 17A - GNMA CDR DEPOSITARIES
Following is a list of approved depositaries for GNMA CDRs as of April, 1979:
. Continental Illinois National Bank and Trust Company of Chicago
. First National Bank of Chicago
Appendix 17B
APPENDIX 17B - FIRMS APPROVED AS ORIGINATORS OF COLLATERALIZED DEPOSITARY
RECEIPTS
The following is a listing of firms approved as Originators of Collateralized
Depository Receipts under the GNMA-CDR contract as of July 1, 1996:
[Enlarge/Download Table]
--------------------------------------------------------------------------------------------
NUMBER OF CDRS
ORIGINATORS DEPOSITORY ORIGINATOR CAN ISSUE
--------------------------------------------------------------------------------------------
Kaufman and Broad Mortgage Co. First National Bank of Chicago 7
Woodland Hills, CA
Windham Futures Corporation First National Bank of Chicago 23
New York, New York
TransMarket Group, Inc. First National Bank of Chicago 4
Chicago, Illinois
--------------------------------------------------------------------------------------------
07/01/96
Appendix 19
APPENDIX 19 - Pricing Brokers for the Bond Buyer Municipal Bond Index
Butler, Larsen, Pierce & Company, Inc.
Chapdelaine & Co.
J.F. Hartfield & Co.
J.J. Kenney Drake, Inc.
Municipal Partners, Inc.
10/01/99
Appendix 37A
[APPENDIX 37A - MILL SITE WAREHOUSES
Definition - A mill site warehouse for purposes of the rough rice futures
contract shall be the following:
1) A warehouse which is attached to or directly adjacent to a commercial rice
mill such that rough rice is readily conveyed from warehouse to mill by a
means consistent with cash market practices (i.e., conveyor belt, loader,
etc.);
2) The warehouse must be owned or leased by the rice mill;
3) The rice mill must be equipped to commercially mill rough rice and produce
milled white rice on a regular basis and must have milled rough rice and
produced milled white rice within the last twenty-four months; and
4) The rice mill must have a minimum milling capacity of 250 hundredweights
per hour of rough rice]
Deletions bracketed for September 2000 and subsequent contracts. 10/01/99
APPENDIX 37B - ROUGH RICE REGULARITY
ROUGH RICE REGULARITY
---------------------
The following applications for a declaration of regularity for the delivery of
Rough Rice have been approved through June 30, 2002:
[Enlarge/Download Table]
------------------------------------------------------------------------------------------------------------------------------
Total Maximum Storage Rate Load-Out rate
FIRM/FACILITY Capacity Receipts (per hundred weight (per hundred
(cwt.) Deliverable per day) weight
------------------------------------------------------------------------------------------------------------------------------
ADM-RICELAND PARTNERSHIP
[1/] Waldenburg, AR 400,000 200 34.00/100 of a cent 22.22 cents
AC HUMKO CORPORATION/BRINKLEY DRYER & STORAGE CO, INC.
[1/] Brinkley, AR 505,800 252 29.22/100 of a cent 20.00 cents
FARMER'S GRANARY, INC.
[2/] Patterson, AR 1,100,700 550 29.19/100 of a cent 22.22 cents
GULF RICE ARKANSAS LLC
[2/] Harrisburg, AR 953,000 476 34.00/100 of a cent* 22.22 cents
POINSETT RICE & GRAIN, INC.
[2/] Waldenburg, AR 307,250 153 29.67/100 of a cent 22.22 cents
Diaz, AR 272,500 136 29.67/100 of a cent 22.22 cents
PRODUCER'S RICE MILL, INC.
[2/] Stuttgart, AR 122,000 500+ 28.89/100 of a ct. 20.00 cents
[1/] Stuttgart, AR 400,000 28.89/100 of a ct. 20.00 cents
[2/] Wynne, AR 387,000 28.89/100 of a ct. 20.00 cents
RICELAND FOODS, INC.
[2/] Dumas, AR 450,000 3,324+ 34.00/100 of a ct. 22.22 cents
[2/] Fair Oaks, AR 450,000 34.00/100 of a ct. 22.22 cents
[2/] Hickory Ridge, AR 338,000 34.00/100 of a ct. 22.22 cents
[1/] Jonesboro, AR 2,250,000 34.00/100 of a ct. 22.22 cents
[2/] McGehee, AR 300,000 34.00/100 of a ct. 22.22 cents
[2/] Newport, AR 360,000 34.00/100 of a ct. 22.22 cents
[1/] Stuttgart, AR- Dryer 1,600,000 34.00/100 of a ct. 22.22 cents
Mill Site
[2/] Weiner, AR 450,000 34.00/100 of a ct. 22.22 cents
[2/] Wheatly, AR 450,000 34.00/100 of a ct. 22.22 cents
------------------------------------------------------------------------------------------------------------------------------
* Storage rate cap of 34/100 of a cent applies to all receipts issued on and
after 05/01/95
+ Maximum number of receipts allowed to issue at all facilities.
[1/Mill Site/deliverable at par]
[2/Non-Mill Site/deliverable at - 15 cents/cwt.]
Deletions bracketed for September 2000 and subsequent contracts. 07/01/00
APPENDIX 37C - DEFINITIONS
FIRST POSITION DAY - Shall be the second business day prior to the first
business day of the delivery month.
FIRST NOTICE DAY - Shall be the business day prior to the first business day
of the delivery month.
FIRST DELIVERY DAY - Shall be the first business day of the delivery month.
LAST TRADING DAY - Shall be the business day prior to the last seven business
days of the delivery month.
LAST NOTICE DAY - Shall be the business day prior to the last business day
of the delivery month.
LAST DELIVERY DAY - Shall be the last business day of the delivery month.
11/01/94
APPENDIX 37D - MINIMUM FINANCIAL REQUIREMENTS FOR ROUGH RICE REGULARITY
The minimum financial requirements for firms which are regular to deliver Rough
Rice are:
1. Working Capital - (current assets less current liabilities) must
be greater than or equal to $1,000,000. Firms which do not have $1,000,000
in working capital must deposit with the Exchange $5,000 per contract which
they are regular to deliver, up to a maximum of $1,000,000 less SEC
haircuts, as specified in SEC Rule 15c3-1(c) (2) (vi), (vii) and (viii)
plus 3% in the event of liquidation.
2. Net Worth - (Total assets less total liabilities) divided by the
firm's allowable capacity (measured in contracts) must be greater than
$5,000.
3. Each firm which is regular to deliver Rough Rice is required to
file a yearly certified financial statement within 90 days of the firm's
year-end. Each such firm is also required to file within 90 days of the
statement date an unaudited semi-annual financial statement. In addition,
the Exchange may request additional financial information as it deems
appropriate;
4. A Letter of Attestation must accompany all financial statements.
The Letter of Attestation must be signed by at least two general partners
or two active executive officers.
11/01/94
Dates Referenced Herein and Documents Incorporated by Reference
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