Board of Trade of the City of Chicago Inc – ‘425’ on 8/24/01 re: Board of Trade of the City of Chicago Inc

On:  Friday, 8/24/01   ·   Accession #:  950131-1-503086   ·   File #:  132-01854

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Business-Combination Transaction Communication   —   Rule 425
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 425         Business-Combination Transaction Communication         3     21K 

425
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Filed by Board of Trade of the City of Chicago, Inc. (CBOT) 
  Subject Company -- Board of Trade of the City of Chicago, Inc.
File No. 333-54370                                          

The following document was distributed to CBOT members and certain financial    
institutions beginning on August 27, 2001.                                      

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION  
--------------------------------------------------------------------------------
(in thousands)  

                                                                [Download Table]

                                                         (Unaudited)              
                                                           June 30,   December 31,
                             ASSETS                          2001         2000    
                                                          ---------   ---------   
                                                                                  
Current assets:                                                                   
   Cash and cash equivalents:                                                     
    Held under deposit and membership transfers           $   1,511   $   4,653   
    Restricted                                                  909           -   
    Unrestricted                                             29,072      23,552   
                                                          ---------   ---------   

           Total cash and cash equivalents                   31,492      28,205   

   Accounts receivable, net                                  21,787      20,920   
   Other current assets                                       1,961       3,256   
                                                          ---------   ---------   

           Total current assets                              55,240      52,381   

Property and equipment:                                                           
   Land                                                      34,234      34,234   
   Buildings and equipment                                  306,520     305,922   
   Furnishings and fixtures                                 148,625     153,504   
   Computer software and systems                             56,665      50,203   
   Construction in progress                                       -         938   
                                                          ---------   ---------   

           Total property and equipment                     546,044     544,801   
   Less accumulated depreciation and amortization           254,594     239,745   
                                                          ---------   ---------   

           Property and equipment - net                     291,450     305,056   

Other assets                                                 14,960      14,757   
                                                          ---------   ---------   

Total assets                                              $ 361,650   $ 372,194   
                                                          =========   =========   

                        LIABILITIES AND MEMBERS' EQUITY                           

Current liabilities:                                                              
   Accounts payable                                       $   9,391   $  17,805   
   Due to CBOT/Eurex Alliance                                 5,481       8,939   
   Funds held for deposit and membership transfers            1,511       4,653   
   Note payable                                               7,716       9,282   
   Current portion of long-term debt                         13,822      18,014   
   Deferred revenue                                           4,581         155   
   Other current liabilities                                 26,509      17,682   
                                                          ---------   ---------   

           Total current liabilities                         69,011      76,530   

 Long-term liabilities:                                                           
   Deferred income taxes                                     25,118      28,572   
   Long-term debt                                            59,976      64,286   
   Other liabilities                                          9,489      11,486   
                                                          ---------   ---------   

           Total long-term liabilities                       94,583     104,344   
                                                          ---------   ---------   

           Total liabilities                                163,594     180,874   

Equity:                                                                           
   Members' equity                                          198,112     191,320   
   Accumulated other comprehensive loss                         (56)          -   
                                                          ---------   ---------   

           Total members' equity                            198,056     191,320   
                                                          ---------   ---------   

Total liabilities and members' equity                     $ 361,650   $ 372,194   
                                                          =========   =========   

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BOARD OF TRADE OF THE CITY OF CHICAGO, INC.               
AND SUBSIDIARIES                

CONDENSED CONSOLIDATED STATEMENTS OF INCOME               
(Unaudited) (in thousands)                

                                                        [Enlarge/Download Table]

------------------------------------------------------------------------------------------------  

                                                                         Six Months Ended         
                                                                              June 30,            
                                                                   -------------------------------
                                                                         2001             2000    
                                                                   --------------    -------------
                                                                                                  
Revenues:                                                                                         
   Exchange fees                                                       $ 63,316         $ 54,454  
   Market data                                                           32,102           29,330  
   Building                                                              12,589           12,717  
   Services                                                               6,401            9,638  
   Dues                                                                   4,614              917  
   Other                                                                    550              684  
                                                                       --------         --------  

           Total revenues                                               119,572          107,740  

Expenses:                                                                                         
   Salaries and benefits                                                 29,845           30,723  
   Depreciation and amortization                                         21,984           18,181  
   Professional services                                                 10,039           14,491  
   General and administrative expenses                                   28,691           21,802  
   Building operating costs                                              11,738           12,135  
   Programs                                                                 931            1,578  
   Other                                                                  2,000            8,330  
                                                                       --------         --------  

           Total expenses                                               105,228          107,240  
                                                                       --------         --------  

Income from operations                                                   14,344              500  

   Interest income                                                          589              671  
   Interest expense                                                       3,359            2,721  
                                                                       --------         --------  

Income (loss) before income taxes and cumulative effect of change in                              
 accounting principle                                                    11,574           (1,550) 

 Provision for income taxes:                                                                      
   Current                                                                8,381            4,517  
   Deferred                                                              (3,454)          (3,111) 
                                                                       --------        ---------  

           Total provision for income taxes                               4,927            1,406  
                                                                        -------        ---------  

Income (loss) before cumulative effect of change in accounting                                    
 principle                                                                6,647           (2,956) 

Cumulative effect of change in accounting principle - net of tax             51                -  
                                                                       --------        ---------  

   Net income (loss)                                                   $  6,596         $ (2,956) 
                                                                       ========         ========  


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BOARD OF TRADE OF THE CITY OF CHICAGO, INC. 
AND SUBSIDIARIES  

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
(Unaudited) (in thousands)  

                                                        [Enlarge/Download Table]

----------------------------------------------------------------------------------------------------- 

                                                                              Six Months Ended        
                                                                                  June 30,            
                                                                       ------------------------------ 
                                                                         2001                  2000   
                                                                       --------              -------- 
                                                                                                      
Cash flows from operating activities:                                                                 
   Net income (loss)                                                   $  6,596              $ (2,956)
   Adjustments to reconcile net income to net cash                                                    
        flows from operating activities:                                                              
     Cumulative effect of change in accounting principle                     87                     - 
     Depreciation and amortization                                       21,984                18,181 
     Loss on disposition of property and equipment                        1,346                   371 
     Deferred income taxes                                               (3,454)               (3,111)
     Changes in assets and liabilities                                   (3,809)                6,369 
                                                                       --------              -------- 

     Net cash flows from operating activities                            22,750                18,854 

Cash flows from investing activities:                                                                 
   Acquisition of property and equipment                                 (9,720)              (15,847)
   Proceeds from sale of property and equipment                              68                   107 
   Investment in CBOT/Eurex Alliance                                          -                  (500)
                                                                       --------              -------- 

     Net cash flows used in investing activities                         (9,652)              (16,240)

Cash flows from financing activities:                                                                 
   Payment of private placement senior notes                            (10,714)                    - 
   Payment of 1997 revolving credit agreement                            (7,300)               (6,500)
   Proceeds from secured note payable                                    10,000                     - 
   Payment of secured note payable                                         (489)                    - 
   Additions to note payable                                              8,675                     - 
   Payment of note payable                                              (10,179)                    - 
   Capital contributions from members                                       196                   174 
                                                                       --------              -------- 

     Net cash flows used in financing activities                         (9,811)               (6,326)
                                                                       --------              -------- 

Net increase (decrease) in cash and cash equivalents                      3,287                (3,712)

Cash and cash equivalents - Beginning of period                          28,205                22,449 
                                                                       --------              -------- 

Cash and cash equivalents - End of period                              $ 31,492              $ 18,737 
                                                                       ========              ======== 

Cash paid for:                                                                                        
   Interest                                                            $  3,310              $  3,365 
                                                                       ========              ======== 
   Taxes                                                               $  6,500              $      - 
                                                                       ========              ======== 

While the Board of Trade of the City of Chicago, Inc. (CBOT(R)) has filed a     
Registration Statement on Form S-4, including preliminary proxy statement and   
prospectus, regarding the restructuring transactions with the SEC, it has not   
yet become effective, which means it is not yet final.  CBOT(R) members are     
urged to read the final Registration Statement on Form S-4, including the final 
proxy statement and prospectus, regarding the restructuring transactions        
referred to above, when it is finalized and distributed to members, as well as  
to the other documents which the CBOT(R) has filed or will file with the SEC,   
because they contain or will contain important information for making an        
informed investment decision. Members may obtain a free copy of the final       
prospectus when it becomes available, and other documents filed by the CBOT(R)  
at the SEC's web site at www.sec.gov. This communication shall not constitute an
offer to sell or the solicitation of an offer to buy, nor shall there be any    
sale of securities in any state in which offer, solicitation or sale would be   
unlawful prior to registration or qualification under the securities laws of any
such state. No offering of securities shall be made except by means of a        
prospectus meeting the requirements of Section 10 of the Securities Act of 1933,
as amended.                                                                     

*   *   *   * 

Dates Referenced Herein

				Referenced-On Page
This ‘425’ Filing		Date		First		Last			Other Filings
		8/27/01		1					None on these Dates
Filed on:		8/24/01
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