[Federal Register Volume 68, Number 248 (Monday, December 29, 2003)]
[Notices]
[Pages 74991-75004]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-31804]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48950; File No. SR-CBOE-2003-55]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change and Amendment No. 1 Thereto by the Chicago Board Options 
Exchange, Inc. To Amend Provisions of its Constitution and Rules 
Pertaining to the Governance of the Exchange

December 18, 2003.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on November 19, 2003, the Chicago Board Options Exchange, Inc. 
(``CBOE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by the CBOE. 
On December 11, 2003, CBOE submitted Amendment No. 1 to the proposed 
rule change. The Commission is publishing this notice to solicit 
comments on the proposed rule change, as amended, from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    CBOE proposes to amend various provisions of its Constitution and 
Rules pertaining to the governance of the Exchange. The text of the 
proposed rule change appears below. Added text is in italics. Deleted 
text is in brackets.

Chicago Board Options Exchange, Incorporated Constitution

Article I

Definitions

    Section 1.1 When used in this Constitution, except as expressly 
otherwise provided or unless the context otherwise requires:
    (a) The term ``Exchange'' means the Chicago Board Options Exchange, 
Incorporated or its exchange market.
    (b) The term ``member'' means an individual member or a member 
organization of the Exchange (or a registered nominee of such a member 
organization) that is a regular member in good standing described in 
Section 2.1(b) of Article II of the Constitution.
    (c) The term ``member organization'' means a partnership or 
corporation which owns or leases a membership, or a partnership or 
corporation for which a membership is registered in

[[Page 74992]]

accordance with Section 2.4 of Article II of the Constitution.
    (d) The term ``Board'' means the Board of Directors of the 
Exchange.
    (e) The term ``Rules'' means the rules of the Exchange as adopted 
or amended from time to time.

Article II

Membership

Section 2.1 Number of Memberships

    (a) Membership in the Exchange shall be made available by the 
Exchange at such times, under such terms and in such number as shall be 
proposed by the Board and approved by the affirmative vote of the 
majority of voting [the] members present in person or represented by 
proxy at a regular or special meeting of the membership. Such an 
affirmative vote by the members shall be required for the issuance of 
all new memberships, whether regular or special, whether having 
expanded or limited rights, whether designated memberships or permits 
or as a classification using any other description, which grant the 
holders thereof the right to enter into securities transactions at the 
Exchange.
    (b) The regular membership of the Exchange shall consist of persons 
who acquire regular memberships made available by the Exchange in 
accordance with the Rules, and shall also consist of those members of 
the Board of Trade of the City of Chicago who, pursuant to paragraph 
(b) of Article FIFTH of the Certificate of Incorporation, elect to 
apply for membership and are approved for membership in accordance with 
the Rules. Except as otherwise expressly provided in the Certificate of 
Incorporation, the Constitution or the Rules, every regular member of 
the Exchange shall be entitled to the same rights and privileges, and 
shall be subject to the same obligations, as every other regular 
member.
    (c) [Reserved for special memberships.]
    (d)(1) Seventy-five ``Options Trading Permits'' (``Permits'') shall 
be issued or made available for leasing in accordance with the Rules. 
All Permits shall expire, and all rights of their holders shall cease, 
on the seventh anniversary of the date determined pursuant to agreement 
between the Exchange and the New York Stock Exchange (``NYSE'') on 
which trading begins on the floor of the Exchange in options that were 
listed on the NYSE.
    (2) Permit holders shall have no right to petition or to vote at 
Exchange membership meetings or elections or to be counted as part of a 
quorum, shall have no interest in the assets or property of the 
Exchange and no right to share in any distribution by the Exchange, and 
shall have none of the other rights or privileges accorded members 
under any provision of the Constitution and Rules other than those 
specified in the Rules.

Section 2.2 Eligibility for Membership; Good Standing

    Membership shall be limited to individuals, partnerships and 
corporations, subject to their meeting the conditions of approval as 
stated in the Constitution and Rules. Members must have as the 
principal purpose of their membership the conduct of a public 
securities business as defined in the Rules.
    The good standing of a member may be suspended, terminated or 
otherwise withdrawn, as provided in the Rules, if any of said 
conditions for approval cease to be maintained or the member violates 
any of its agreements with the Exchange or any of the provisions of the 
Constitution or the Rules. Unless a member is in good standing, the 
member shall have no rights or privileges of membership except as 
otherwise provided by statute, the Certificate of Incorporation, the 
Constitution or the Rules, shall not hold himself or itself out for any 
purpose as a member, and shall not deal with the Exchange on any basis 
except as a non-member.

Section 2.3 Nominees of Member Organizations

    Every applicant for membership as a member organization and every 
member organization shall, in accordance with the Rules, designate an 
individual nominee with respect to each membership owned or leased by 
it, who shall be subject to the same requirements for approval as if he 
were himself applying for membership as an individual member and shall 
be authorized to represent the organization in all matters relating to 
the Exchange.

Section 2.4 Registration of Individual Memberships for Member 
Organizations

    Every individual member or applicant who is or intends to become an 
executive officer, director, principal shareholder or general partner 
of an organization engaged or proposing to engage in business as a 
broker or dealer in options may apply to register his membership for 
such organization. Additional individual members may register their 
memberships for a member organization in accordance with the Rules. 
Such organization shall be subject to the same requirements for 
approval as if it were itself applying for membership as a member 
organization, except that the individual member so applying shall 
represent the organization in lieu of a nominee. Registration of an 
individual membership for an organization may be withdrawn by the 
Exchange for any reason which would justify withdrawal of the approval 
of either the individual or the organization for membership.

Section 2.5 Acquisition and Transfer of Memberships

    Memberships acquired pursuant to paragraph (b) of Article FIFTH of 
the Certificate of Incorporation shall not be transferable. All other 
memberships may be offered for sale and transferred by the owners 
thereof, or under certain circumstances by the Exchange, as provided in 
the Rules.

Section 2.6 Voting and Other Rights and Powers

    Each regular member shall have the voting rights and power provided 
by law and by the Certificate of Incorporation and the Constitution.

Article III

Meetings of Members

Section 3.1 Place of Meetings

    Each meeting of the members shall be held at such a place, within 
or without the State of Delaware, as the Secretary [Board] may 
designate prior to the giving of notice of such meeting, but if no such 
designation is made, then on the fourth floor of the Exchange.

Section 3.2 Annual Election Meeting

    An annual election meeting of members shall be held on the 1st 
business day preceding the 3rd Friday in November of each year [unless 
such day is a legal holiday, in which case on the next succeeding 
business day which is not a legal holiday], at such time as may be 
designated by the Secretary [Board] prior to the giving of notice of 
the meeting, for the purpose of electing directors to fill expiring 
terms and any vacancies in unexpired terms and electing members of the 
Nominating Committee to fill expiring terms and any vacancies in 
unexpired terms.

Section 3.3 Annual Report Meeting

    An annual report meeting of members shall be held within 120 days 
following the end of the Exchange's fiscal year, at a time as 
determined by the Secretary [Board], for the purpose of presentation of 
the Exchange's annual report as provided for in Section 6.11 of the 
Constitution [transacting such business as may properly be brought 
before the meeting].

[[Page 74993]]

Section 3.4 Special Meetings

    Special meetings of members, for any purpose or purposes, unless 
otherwise prescribed by statute or by the Certificate of Incorporation, 
may be called by the Chairman of the Board, the Vice Chairman of the 
Board or the Board of Directors, and shall be called by the Secretary 
at the request in writing of 150 voting members, provided that such 
request shall state the purpose or purposes of the proposed meeting and 
the day and hour at which such meeting shall be held.

Section 3.5 Notice of Members' Meetings

    Unless otherwise prescribed by statute, the Certificate of 
Incorporation, the Constitution or the Rules, written notice of each 
meeting of members at which a vote of members is to be taken, stating 
the date, time and place thereof, and, in the case of special meetings, 
the purpose or purposes for which such meeting is called, shall be 
given [delivered] to each member entitled to vote thereat not more than 
60 days and at least 10 days before the date of the meeting.

Section 3.6 Quorum and Adjournments

    Except as otherwise provided by statute, the Certificate of 
Incorporation or the Constitution, a majority of the members entitled 
to vote, when present in person or represented by proxy, shall 
constitute a quorum at all meetings of members for the transaction of 
business, provided that in respect to uncontested elections, one-third 
of the members entitled to vote, when present in person or represented 
by proxy, shall constitute a quorum. If such quorum shall not be 
present or represented by proxy at any meeting of members, a majority 
of the members present in person or represented by proxy at the meeting 
shall have power to adjourn the meeting from time to time, without 
notice other than announcement at the meeting unless otherwise required 
by statute, until a quorum shall be present or represented. At any such 
adjourned meeting at which a quorum is present, any business may be 
transacted which might have been transacted at the meeting as 
originally notified. Nothing in the Constitution shall affect the right 
to adjourn a meeting from time to time where a quorum is present.

Section 3.7 Voting by Members

    With respect to any question brought before a meeting, when a 
quorum is present, a majority of voting members present in person or 
represented by proxy shall decide the question, unless the question is 
one upon which by express provision of statute, the Certificate of 
Incorporation or the Constitution, a different vote is required, in 
which case such express provision shall govern and control. Voting on 
any question brought before any meeting of members shall be, so far as 
applicable, in accordance with the procedure provided by Article V of 
the Constitution for the conduct of the annual election.

Section 3.8 Determination of Members of Record

    (a) The Board of Directors may fix a record date to determine the 
members entitled to notice of and to vote at a meeting of the members 
or any adjournment thereof (``Record Date''). The Record Date shall not 
be more than 60 days nor less than 10 days before the date of the 
meeting.
    (b) If no Record Date is fixed by the Board of Directors for a 
meeting of members, the Record Date for the meeting shall be at the 
close of business on the day preceding the date on which notice of the 
meeting is given by the Exchange.
    (c) A Record Date shall apply to any adjournment of a meeting of 
members; provided, however, that the Board of Directors may fix a new 
Record Date for the adjourned meeting.

Article IV

Nominations

Section 4.1 Nominating Committee

    (a) There shall be a Nominating Committee composed of four members 
who are primarily engaged in business on the floor of the Exchange in 
the capacity of a member (floor members); two persons [members] who are 
officers of member organizations that primarily conduct a non-member 
public customer business (firm members); two persons [members] each of 
whom directly or indirectly owns and controls (as defined in Section 
6.1(a)) one or more memberships in respect of which he acts solely as 
lessor (lessor members), at least one of whom is not actively engaged 
in business as a ``broker-dealer'' or as a ``person associated with a 
broker-dealer'' as those terms are defined in the Securities Exchange 
Act of 1934; and two representatives of the public (public members).
    (b) All of the members of the Nominating Committee shall be elected 
by the voting members of the Exchange. [In the 1999 annual election 
meeting, one floor member shall be elected for a three year term, and 
two firm members, two lessor members and two public members shall be 
elected, one firm member, one lessor member and one public member for 
terms expiring at the second annual election meeting following the 1999 
annual election meeting, and one firm member, one lessor member and one 
public member for terms expiring at the third annual election meeting 
following the 1999 annual election meeting. In the 2000 annual election 
meeting, one floor member shall be elected for a three year term.] At 
each [subsequent] annual election meeting, members of the Nominating 
Committee shall be elected to succeed those whose terms expire, each to 
serve for a term expiring at the third succeeding annual election 
meeting and until their successors are duly elected and qualified or 
until their earlier death, resignation or removal. Elected members of 
the Nominating Committee shall be ineligible for reelection for a 
period of three years after their terms expire; provided that this 
limitation shall not apply to any member of the Nominating Committee 
whose most recent term on the Nominating Committee was less than three 
years.

Section 4.2 Nominating Committee Vacancies

    Any vacancy occurring among the members of the Nominating Committee 
may be filled by a qualified person appointed by the Vice Chairman of 
the Board with the approval of the Board [to hold office until the next 
annual election meeting, at which time a qualified successor shall be 
elected to serve the unexpired term, if any, of his predecessor in 
office]. The term of any Nominating Committee member so chosen shall be 
from the date of appointment until the next annual election meeting and 
until the person's successor is duly elected and qualified or until the 
person's earlier death, resignation or removal. The remaining portion 
of the unexpired term of a Nominating Committee member, if any, shall 
be served by a person elected at the next annual election meeting.

Section 4.3 Nominating Procedure

    [During October of each year the] The Nominating Committee shall 
hold at least three meetings, at least two of which shall be open to 
the membership, for the purpose of selecting not less than one nominee 
for each of the following offices to be voted upon at the following 
annual election meeting:
    (a) Directors to fill expiring terms and vacancies.
    (b) Nominating Committee members to fill expiring terms and 
vacancies.
    The Nominating Committee shall select nominees to fulfill the

[[Page 74994]]

requirements of Sections 6.1 and 4.1 of the Constitution with an 
obligation to have the various interests of the membership represented 
on the Board and the Nominating Committee, respectively.
    Notice of each of the meetings of the Nominating Committee shall be 
posted on the Exchange bulletin board [on the floor of the Exchange].
    The Nominating Committee shall post its nominees of Directors and 
Nominating Committee members on the Exchange bulletin board not later 
than October 10th, or the first business day thereafter if October 10th 
is not a business day.

Section 4.4 Replacement Nominees

    In the event any nominee named by the Nominating Committee 
withdraws or becomes ineligible, the Nominating Committee may select an 
additional qualified nominee to replace the withdrawn or ineligible 
nominee, and it shall select an additional qualified nominee if, as a 
result of the withdrawal or ineligibility, there is not at least one 
nominee for each of the offices to be elected.

Section 4.5 Nomination by Petition

    Nominations of candidates for election to the Board or the 
Nominating Committee may be made by petition, signed by not less than 
100 voting members of the Exchange and filed with the Secretary no 
later than 5:00 p.m. (Chicago time) on the Monday preceding the 1st 
Friday in November, or the first business day thereafter in the event 
that Monday occurs on a holiday.

Section 4.6 Posting of Names of Nominees

    Names of nominees and replacement nominees selected by the 
Committee and nominees named by petition shall, immediately following 
their selection, be given to the Secretary who shall promptly post them 
upon the Exchange bulletin board.

Section 4.7 Qualifications of Nominees

    Candidates for election to the Board or the Nominating Committee, 
whether nominated by the Nominating Committee or by petition, shall be 
eligible for election in any of the categories for which they qualify 
both at the time of their nomination and at the time of their election. 
The sole judge of whether a candidate satisfies the applicable 
qualifications for election to the Board or the Nominating Committee in 
a designated category shall be the Nominating Committee in the case of 
candidates nominated by that Committee, and shall be the Executive 
Committee in the case of candidates nominated by petition, and the 
decision of the respective committee shall be final.

Section 4.8 Qualifications of Nominating Committee Members

    Following election or appointment to the Nominating Committee, each 
Nominating Committee member must continuously satisfy the applicable 
qualifications for service on the Nominating Committee. The sole judge 
of whether a Nominating Committee member satisfies the applicable 
qualifications for service on the Nominating Committee shall be the 
Board of Directors. Notwithstanding the foregoing, a member of the 
Nominating Committee who fails to maintain the applicable 
qualifications will be allowed 45 days from the date when the Board 
determines the Nominating Committee member is unqualified in which to 
requalify. During any such period up until the time when the Nominating 
Committee member requalifies, the Nominating Committee member shall be 
deemed not to hold office and the seat formerly held by the Nominating 
Committee member shall be deemed to be vacant for all purposes. The 
Board of Directors shall be the sole judge of whether the Nominating 
Committee member has requalified.

Section 4.9 Removal of Nominating Committee Members

    In the event of the refusal, failure, neglect, or inability of any 
Nominating Committee member to discharge that person's duties, or for 
any cause affecting the best interests of the Exchange, the sufficiency 
of which the Board of Directors shall be the sole judge, the Board 
shall have the power, by the affirmative vote of at least two-thirds of 
the Directors then in office, to remove that Nominating Committee 
member from the Committee.

Article V

Conduct of Annual Election

Section 5.1 Election Committee

    The Vice Chairman of the Board, with the approval of the Board, 
shall appoint not less than three tellers, none of whom may be a member 
of the Exchange or a partner or officer of a member organization, who 
shall constitute a Committee to conduct the annual election. The 
Committee shall have authority to decide all questions pertaining to 
the conduct of the annual election, and its decision shall be final.

Section 5.2 Voting Procedure

    (a) Immediately following the expiration of the time within which 
nominations may be made by petition, the Secretary shall prepare a 
ballot listing all candidates nominated for offices to be voted upon at 
the annual election, the order of the listing to be determined by lot. 
A ballot, a form of proxy, an envelope marked ``For Ballot Only'' and a 
return envelope shall be mailed by the Secretary to each member 
eligible to vote, together with the notice of the annual election. 
Members may vote, either in person or by proxy, by marking the ballot 
which shall remain unsigned and sealing the same in the unmarked ballot 
envelope. Members desiring to vote by proxy shall mail or deliver the 
sealed ballot, accompanied by a signed proxy card, to the Secretary so 
that it is received by the Secretary prior to the election. At the 
election, members voting in person shall deliver their sealed ballot 
envelopes to at least two members of the Election Committee, who shall 
keep a list of the members voting and shall place the sealed ballot 
envelopes in the ballot box. [Following the completion of voting in 
person, the] The Secretary shall deliver to the Election Committee all 
of the proxies, each with its accompanying sealed ballot envelope. At 
least two members of the Election Committee shall check the names of 
the members voting by proxy on the voting list, file the proxies, and 
place the sealed ballot envelopes in the ballot box.
    (b) The Exchange may permit electronic submission of ballots and 
proxies, or implement a confidential electronic voting process, in a 
form and manner prescribed by the Exchange. The Exchange may modify the 
procedures in paragraph (a) of this Section to accommodate 
electronically submitted voting materials and votes.

Section 5.3 Counting of Ballots

    Following the conclusion of the annual election meeting, the 
Election Committee shall count all of the properly submitted votes. 
[When all of the ballots properly submitted at the election have been 
placed in the ballot box, members of the Election Committee shall open 
the ballot box and the sealed ballot envelopes, and shall count the 
ballots.] A plurality of the votes shall elect the directors; provided, 
however, that where a plurality of votes cast would not elect the 
number of directors from each of the categories specified in Section 
6.1, then the specified number of candidates from each of such 
categories who receive the highest votes among all those candidates in 
each such

[[Page 74995]]

category shall be elected in lieu of those candidates who receive what 
would otherwise be the lowest winning pluralities. A plurality of the 
votes shall elect the members of the Nominating Committee; provided, 
however, that in the same manner as described above for the election of 
directors, in any case where a plurality of votes cast would not elect 
the number of members of the Nominating Committee from each of the 
categories specified in Section 4.1, then the specified number of 
candidates in each such category who receive the highest votes among 
all candidates in that category shall be elected. The Election 
Committee shall cause election results to be posted on the Exchange 
bulletin board [on the floor of the Exchange].

Article VI

Board of Directors

Section 6.1 Number, Election and Term of Office of Directors

    (a) The Board of Directors shall consist of 22 Directors as 
described below and the Chairman of the Board, who by virtue of his 
office shall be a member of the Board. The Directors elected by the 
membership shall be divided into three classes which, commencing with 
the 2002 annual election meeting, shall be composed as follows: \1\
    Class I shall consist of one member who directly or indirectly owns 
and controls a membership and is primarily engaged in business on the 
floor of the Exchange in the capacity of a member (floor director), one 
person [member] who directly or indirectly owns and controls a 
membership with respect to which he acts solely as lessor and who is 
not actively engaged in business as a ``broker-dealer'' or as a 
``person associated with a broker-dealer'' as those terms are defined 
in the Securities Exchange Act of 1934, (lessor director), and three 
persons who are not members and [non-members] who are not broker-
dealers or persons affiliated with broker-dealers (public directors).
    Class II shall consist of one floor director, one person [member] 
who functions as a member in any recognized capacity either 
individually or on behalf of a member organization (at-large director), 
two persons [members] who are executive officers of member 
organizations that primarily conduct a non-member public customer 
business and are not individually engaged in business on the Exchange 
floor (off-floor directors) and four public directors.
    Class III shall consist of two floor directors, one at-large 
director, two off-floor directors and four public directors.
    The ordinary place of business of at least one of the two off-floor 
directors in each Class shall be a location more than 80 miles from the 
Exchange's trading floor.
    For purposes of this Section 6.1, a person [member] shall be 
considered to directly own and control a membership only if the person 
[member] individually and directly owns of record and beneficially all 
right, title and interest in the membership, and a person [member] 
shall be considered to indirectly own and control a membership only if 
the person [member] (A) has the sole and exclusive right to vote the 
membership and control its sale, and (B) is in possession of and 
subject to all of the risks and rewards of a direct owner of at least a 
fifty percent (50%) interest in a membership, either through ownership 
of an equity interest in a member organization or of a beneficial 
interest in a trust, which in either case is the owner of one or more 
memberships as permitted under the Rules.
    (b) The terms of Class I, Class II and Class III directors shall 
terminate following the annual election meetings to be held in 2002, 
2003 and 2004, respectively. At the 2002 annual election meeting, all 
of the Class I directors shall be elected for three-year terms, and 
directors shall be elected to fill vacancies in Classes II and III. At 
each [subsequent] annual election meeting [meetings], [the] directors 
[of each class] shall be elected for three year terms to succeed those 
whose terms are then about to expire, and they shall hold office for 
the terms for which elected and until their successors shall have been 
duly elected and qualified[,] or until their earlier death, resignation 
or removal. The term of office of each director elected at an annual 
election meeting shall commence on January 1st of the year following 
that annual election meeting and shall continue until December 31st of 
the final year of the director's term of office. [Terms of office of 
directors shall expire at the first regular meeting of the Board of 
Directors held on or after January 1 following the annual election 
meetings at which their successors are elected.]

Section 6.2 Powers of the Board

    The Board of Directors shall be the governing body of the Exchange 
and shall be vested with all powers necessary for the management of the 
business and affairs of the Exchange and for the promotion of its 
welfare, objects and purposes. The Board shall regulate the business 
conduct of members and may exercise all such powers of the Exchange and 
do all such lawful acts and things as are not by statute, the 
Certificate of Incorporation, the Constitution or the Rules directed or 
required to be exercised or done by members. In the exercise of such 
powers, the Board may organize such subsidiary corporations, impose 
such fees and charges, adopt or amend such Rules, issue such orders and 
directions, and make such decisions as it deems necessary or 
appropriate. It may prescribe and impose penalties for violations of 
the Constitution or Rules, for neglect or refusal to comply with 
orders, directions or decisions of the Board, or for any other offenses 
against the Exchange.

Section 6.3 Resignation, Disqualification and Removal of Directors

    (a) A Director may resign at any time by giving written notice of 
his resignation to the Chairman of the Board or the Secretary, and such 
resignation, unless specifically contingent upon its acceptance, will 
be effective as of its date or of the date specified therein.
    (b) In the event (i) any Director other than a public director 
ceases to be a member or executive officer of a member organization or 
(ii) the number of Directors in any designated category within a Class 
falls below the number for that category and Class (as specified in 
Section 6.1) because of the failure of a Director to maintain the 
qualifications for the designated category, of which failure the Board 
of Directors shall be the sole judge, the Director shall thereupon 
cease to be a Director, his office shall become vacant and the vacancy 
may be filled [at the next scheduled meeting of] by the Board of 
Directors with a person who qualifies for the category in which the 
vacancy exists. [, provided that] Notwithstanding the foregoing:
    (A) A Director who fails to maintain the applicable qualifications 
will be allowed the later of (i) 45 days from the date when the Board 
determines the Director is unqualified or (ii) until the next regular 
Board meeting following the date when the Board makes such 
determination, in which to requalify. During any such period up until 
the time when the Director requalifies, the Director shall be deemed 
not to hold office and the seat formerly held by the Director shall be 
deemed to be vacant for all purposes. The Board of Directors shall be 
the sole judge of whether the Director has requalified.
    (B) A Director other than a public director whose membership is

[[Page 74996]]

suspended may remain a Director during the period of suspension unless 
he is removed pursuant to paragraph (c) of this Section.
    (c) In the event of the refusal, failure, neglect or inability of 
any Director to discharge his duties, or for any cause affecting the 
best interests of the Exchange the sufficiency of which the Board of 
Directors shall be the sole judge, the Board shall have the power, by 
the affirmative vote of at least two-thirds of the Directors then in 
office, to remove such Director and declare his office vacant.

Section 6.4 Filling of Vacancies

    Any vacancy in the Board of Directors resulting from a Director 
ceasing to hold office prior to the expiration of his term may be 
filled by a person who is qualified to fill the position on [serve in 
the category of] the Board in which the vacancy exists and who is 
appointed by the affirmative vote of a majority of the Directors then 
in office[,]. [and] The term of any Director so chosen shall [serve] be 
from the date of appointment until December 31st of the year of 
appointment [the next annual election meeting] and [until his] the 
Director's successor is duly elected and qualified or until the 
Director's earlier death, resignation or removal. The remaining portion 
of the unexpired term of a Director, if any, shall be served by a 
Director elected at such next annual election meeting.

Section 6.5 Quorum

    At all meetings of the Board, two-thirds of the number of Directors 
then in office shall constitute a quorum for the transaction of 
business, and the vote of a majority of the Directors present at any 
meeting at which a quorum is present shall be the act of the Board, 
except as may be otherwise specifically provided by statute, the 
Certificate of Incorporation, the Constitution or the Rules. If a 
quorum shall not be present at any meeting of the Board, a majority of 
the Directors present thereat may adjourn the meeting from time to 
time, without notice other than announcement at the meeting, until a 
quorum shall be present.

Section 6.6 Regular Meetings

    Regular meetings of the Board shall be held at such time and at 
such place as shall from time to time be provided by resolution of the 
Board without notice other than such resolution.

Section 6.7 Special Meetings

    Special meetings of the Board may be called by the Chairman of the 
Board or the Vice Chairman of the Board and shall be called by the 
Secretary upon the written request of any 4 Directors. The Secretary 
shall give at least one hour's notice of such meeting to each Director, 
either in person, by mail, messenger, overnight courier, facsimile 
machine, electronic mail, telephone, or by announcement on the Exchange 
floor during trading hours on business days[, or personally, or by 
mail, telegram or cablegram]. Every such notice shall state the time 
and place of the meeting which shall be fixed by the person calling the 
meeting, but need not state the purpose thereof except as otherwise 
required by statute, the Constitution or the Rules.

Section 6.8 Participation in Meeting

    Members of the Board or of any committee may participate in a 
meeting of the Board or committee by conference telephone or similar 
communications equipment by means of which all persons participating in 
the meeting can hear each other, and such participation in a meeting 
shall constitute presence in person at such a meeting.

Section 6.9 Informal Action

    Unless otherwise restricted by statute, the Certificate of 
Incorporation, the Constitution or the Rules, any action required or 
permitted to be taken at any meeting of the Board or of any committee 
may be taken without a meeting if all members of the Board or 
committee, as the case may be, consent thereto in writing, and the 
writing or writings are filed with the minutes of proceedings of the 
Board or of the committee.

Section 6.10 Interested Directors

    No Director shall be disqualified from participating in any 
meeting, action or proceeding of the Board by reason of being or having 
been a member of a committee which has made prior inquiry, examination 
or investigation of the subject under consideration. No Director shall 
participate in the adjudication of any matter in which he is personally 
interested, although interested Directors may be counted in determining 
the presence of a quorum at the meeting of the Board or of a committee 
which authorizes actions with respect to such matter.

Section 6.11 Annual Report to Members

    At each Annual Report Meeting of members, the Board shall present a 
complete report of the financial condition of the Exchange, including a 
statement of all receipts and expenditures for the preceding year.

Article VII

Committees

Section 7.1 Designation of Committees

    The committees of the Exchange shall consist of an Executive 
Committee, an Audit Committee, a Compensation Committee, a Floor 
Directors Committee, and such other standing and special committees as 
may be provided in the Constitution or Rules or as may be from time to 
time appointed by the Vice Chairman of the Board with the approval of 
the Board. Except as may be otherwise provided in the Constitution or 
the Rules, the Vice Chairman of the Board with the approval of the 
Board shall appoint the members of all committees and may designate a 
Chairman and a Vice-Chairman thereof.

Section 7.2 The Executive Committee

    The Executive Committee shall consist of the Chairman of the Board, 
the Vice Chairman of the Board, and at least 4 other persons appointed 
as provided in Section 7.1, each of whom must be a Director. Not less 
than 50% of the members of the Executive Committee (excluding the 
Chairman) shall be public directors. Members of the Executive Committee 
shall not be subject to removal except by the Board. The Chairman of 
the Board shall be the Chairman of the Executive Committee. Each member 
of this Committee shall be a voting member. The members of the 
Executive Committee shall serve for a term of one year expiring at the 
first regular meeting of Directors following the annual election 
meeting in each year. The Executive Committee shall have and may 
exercise all the powers and authority of the Board in the management of 
the business and affairs of the Exchange, except it shall not have the 
power or authority of the Board in reference to amending the 
Certificate of Incorporation, adopting an agreement of merger or 
consolidation, recommending to the members the sale, lease or exchange 
of all or substantially all of the Exchange's property and assets, 
recommending to the members the dissolution of the Exchange or a 
revocation of a dissolution, or amending the Constitution or Rules of 
the Exchange.

Section 7.3 The Audit Committee

    The Audit Committee shall consist of at least three Directors 
appointed by the Chairman of the Board with the approval of the Board, 
the exact number to be determined from time to time by the Board. Not 
less than 50% of the members of the Audit Committee shall be public 
directors. Members of the Audit Committee shall not be subject to

[[Page 74997]]

removal except by the Board. The Chairman of the Audit Committee shall 
be a public director appointed by the Chairman of the Board. The Audit 
Committee shall have such duties and may exercise such authority as may 
be prescribed in the Constitution or Rules or by resolution of the 
Board.

Section 7.4 The Compensation Committee

    The Compensation Committee shall consist of the Vice Chairman of 
the Board, the lessor director, the Chairman of the Financial Planning 
Committee, one or more off-floor directors, and such number of public 
directors that will constitute at least 50% of the members of the 
Committee. The off-floor director(s) and the public directors shall be 
appointed to the Compensation Committee by the Chairman of the Board 
with the approval of the Board. Members of the Compensation Committee 
shall not be subject to removal except by the Board. The Chairman of 
the Compensation Committee shall be a public director appointed by the 
Chairman of the Board. The Compensation Committee shall have such 
duties and may exercise such authority as may be prescribed in the 
Constitution or Rules or by resolution of the Board.

Section 7.5 The Floor Directors Committee

    The Floor Directors Committee shall consist of those Directors who 
are primarily engaged in business on the floor of the Exchange (whether 
serving as floor directors or at-large directors), the lessor director 
as a non-voting member of the Committee, and such other persons as may 
be appointed as voting or nonvoting members of the Committee by the 
Vice Chairman of the Board with the approval of the Board. The Vice 
Chairman of the Board shall be the Chairman of the Floor Directors 
Committee. The Floor Directors Committee shall have such duties and may 
exercise such authority as may be prescribed in the Constitution or 
Rules or by resolution of the Board.

Section 7.6 Other

    All other committees shall have such duties and may exercise such 
authority as may be prescribed for them in the Constitution or Rules or 
by resolution of the Board.

Section 7.7 Conduct of Proceedings

    Except as otherwise provided in the Certificate of Incorporation, 
Constitution or Rules, or by resolution of the Board, each committee 
may determine the manner in which its proceedings shall be conducted. 
Committees shall keep minutes of their meetings and periodically report 
their proceedings to the Board of Directors and appropriate committees 
of the Board to the extent requested by the Board or Board committee.

Article VIII

Officers

Section 8.1 Designation; Number; Election

    (a) The officers of the Exchange shall be a Chairman of the Board, 
a Vice Chairman of the Board, a President, one or more Vice-Presidents 
(the number thereof to be determined by the Board of Directors), a 
Secretary, a Treasurer, and such other officers as the Board may 
determine. The Chairman of the Board shall be elected by the 
affirmative vote of at least two-thirds of the Directors then in office 
exclusive of the Chairman, who shall not vote. Such affirmative vote 
may also prescribe his duties not inconsistent with the Constitution or 
Rules and may prescribe a tenure of office.
    The Vice Chairman of the Board shall be a director who owns or 
directly controls his own membership and is primarily engaged in 
business on the floor of the Exchange in the capacity of a member. He 
shall be elected by a plurality of members voting at a meeting of the 
membership held on the 1st business day preceding the 3rd Friday in 
December of each year [(or if that day is not a business day, on the 
next succeeding business day)] to serve as Vice Chairman of the Board 
during the following year. The term of office of the Vice Chairman of 
the Board shall run from January 1st to December 31st of each year. 
Provided that the Vice Chairman of the Board remains qualified to serve 
in that office, he [and] shall serve until the expiration of his term 
in that office and his successor is duly chosen and qualified or until 
his earlier death, [or his] resignation or removal. Once a director has 
held the office of the Vice Chairman of the Board for six months or 
more of a one-year term and for the next two succeeding one-year terms, 
the director shall thereafter be ineligible to again hold the office 
until a period of not less than six months has elapsed during which the 
director has not held that office. Candidates for the office of Vice 
Chairman of the Board must notify the Secretary of the Exchange in 
writing no later than the close of business on November 23rd (or if 
that day is not a business day, on the next succeeding business day). 
In the event there is only one candidate, no election need be held, and 
the Board of Directors shall declare the office filled by the sole 
announced candidate.
    The remaining officers of the Exchange shall be appointed by the 
Chairman of the Board, subject to the approval of the Board, [at the 
first regular meeting of the Board of Directors held on or after 
January 1 following each annual election meeting,] each to serve until 
a successor has been duly chosen and qualified or until the officer's 
earlier death, [or] resignation or removal.
    (b) No officer, other than the Vice Chairman of the Board, shall be 
a member or affiliated with a member or a broker or a dealer in 
securities or commodities. Two or more offices may be held by the same 
person, except the offices of Chairman of the Board and President, 
Chairman of the Board and Secretary, or President and Secretary may not 
be held by the same person. The compensation of all officers of the 
Exchange chosen by the Board shall be fixed by the Board.

Section 8.2 Chairman of the Board of Directors

    The Chairman of the Board shall be the chief executive officer of 
the Exchange, responsible to the Board for the management of its 
business affairs, and shall be the official representative of the 
Exchange in all public matters. The Chairman shall not engage in any 
other business during his incumbency except with approval of the Board, 
and by his acceptance of the office of Chairman of the Board he shall 
be deemed to have agreed to uphold the Constitution and Rules of the 
Exchange. He shall by virtue of his office be a member and presiding 
officer of the Board of Directors and an ex-officio member, without a 
right to vote, of all committees, without prejudice to his being 
specifically appointed as a voting member of any committee.

Section 8.3 Vice Chairman of the Board

    The Vice Chairman of the Board shall preside at meetings of the 
members. Subject to the approval of the Board, the Vice Chairman of the 
Board may appoint standing and special committees unless the method of 
appointment is otherwise provided for in the Constitution or Rules or 
in the resolution of the Board establishing the committee. The Vice 
Chairman of the Board shall be responsible for the coordination of the 
activities of all committees, with the exception of committees of the 
Board, including the Executive Committee, the Audit Committee and the 
Compensation

[[Page 74998]]

Committee. The Vice Chairman of the Board shall be an ex-officio 
member, without a right to vote, of all committees, without prejudice 
to being specifically appointed as a voting member of any committee. In 
the case of the absence or inability to act of the Chairman of the 
Board, or in case of a vacancy in the office of the Chairman of the 
Board, the Vice Chairman of the Board shall exercise the powers and 
discharge the duties of the Chairman of the Board.

Section 8.4 Acting Chairman and Vacancy in Office of Chairman

    (a) In the absence or inability to act of both the Chairman of the 
Board and the Vice Chairman of the Board, the Board may designate an 
Acting Chairman of the Board. In the absence of such a designation by 
the Board, the President, or in his absence or inability to act, the 
senior available Vice-President, shall assume all the functions and 
discharge all the duties of the Chairman of the Board.
    (b) If a vacancy occurs in the office of Chairman, the Board, by 
the affirmative vote of at least two-thirds of the Directors then in 
office, shall fill such vacancy pursuant to Section 8.1(a).

Section 8.5 Vacancy in Office of Vice Chairman of the Board

    (a) If the Vice Chairman of the Board shall cease to satisfy the 
requirements for election to that office, of which failure the Board of 
Directors shall be the sole judge, he shall thereupon cease to hold his 
office and such office shall become vacant, provided that if his 
membership is suspended he may continue to hold office unless he is 
removed pursuant to paragraph (a) of Section 8.7.
    (b) If a vacancy occurs in the office of Vice Chairman of the Board 
pursuant to paragraph (a) of this Section or if for any other reason 
the office becomes vacant, the Board, by the affirmative vote of a 
majority of the Directors then in office, shall fill such vacancy by 
the election to such office of a Director then in office who satisfies 
the requirements for election to such office.

Section 8.6 President

    The President shall be the chief operating officer of the Exchange. 
The President shall, by virtue of his office, be an ex-officio member, 
without a right to vote, of all committees other than committees whose 
membership is limited to directors of the Exchange, without prejudice 
to his being specifically appointed as a voting member of any committee 
other than a committee limited to directors. Except as is otherwise 
provided in the Certificate of Incorporation, the Constitution or the 
Rules, the President shall have the power to employ and dismiss 
employees of the Exchange, and to establish their qualifications, 
duties, and salaries; he shall [execute] approve, but may delegate the 
execution of, all authorized contracts on behalf of the Exchange and 
shall perform such other duties as may be prescribed by the Board from 
time to time. The President shall not engage in any other business 
during his incumbency as President, except with approval of the Board. 
[and by] By his acceptance of the office of President, he shall be 
deemed to have agreed and he shall have agreed to uphold the 
Constitution and Rules. In case of his temporary absence or inability 
to act he may designate any other officer to assume all the functions 
and discharge all the duties of the President. Upon his failure to do 
so, or if the office of President be vacant, the Chairman of the Board 
or any officer designated by him shall perform the functions and duties 
of the President. When the President returns or is again able to act, 
he shall resume his duties.

Section 8.7 Removals

    (a) In the event of the refusal, failure, neglect or inability of 
the Vice Chairman of the Board to discharge his duties, or for any 
cause affecting the best interests of the Exchange, the sufficiency of 
which the Board of Directors shall be the sole judge, the Board shall 
have the power, by the affirmative vote of at least two-thirds of the 
Directors then in office exclusive of the Vice Chairman of the Board, 
to remove the Vice Chairman of the Board and declare such office 
vacant.
    (b) Any officer, other than the Vice Chairman of the Board, chosen 
by the Board may be removed at any time by the Board, Chairman of the 
Board or President [whenever in its judgment the best interests of the 
Exchange would be served thereby]; provided, that the Chairman of the 
Board or the President may be removed only by the affirmative vote of 
at least two-thirds of the Directors then in office exclusive of the 
Chairman of the Board, who shall not vote. Any such removal shall be 
without prejudice to the contract rights, if any, of the person so 
removed.
    (c) Any vacancies occurring in any office of the Exchange at any 
time may be filled by the Board for the unexpired term.

Section 8.8 Vice Presidents

    Vice Presidents shall perform the duties prescribed by the Board, 
[or the] Chairman of the Board or President.

Section 8.9 Secretary

    The Secretary shall attend all meetings of members and of the 
Board; the Secretary [and] shall keep official records of meetings of 
members at which action is taken and of meetings of the Board 
[proceedings thereof]; [he] the Secretary shall, in person or by 
representative, perform like services for the standing and special 
committees when required; [he] the Secretary shall give notice of 
meetings of members and of special meetings of the Board in accordance 
with the provisions of the Constitution or Rules or as required by 
statute; [, he] the Secretary shall post all notices which may be 
required to be posted upon the Exchange bulletin board; [he shall 
collect all monies due the Exchange for assessments, fines, dues, and 
otherwise, and pay the same to the Treasurer; he] the Secretary shall 
be custodian of the books, records, and corporate seal of the Exchange 
and attest, upon behalf of the Exchange, all contracts and other 
documents requiring authentication; [he] the Secretary shall perform 
such other duties as may be prescribed by the Board, [or the] Chairman 
of the Board or President.

Section 8.10 Treasurer

    The Treasurer shall have general charge of the corporate funds and 
securities and shall keep full accounts of receipts and disbursements 
in permanent books belonging to the Exchange; he shall collect all 
monies due the Exchange for assessments, fines, dues, and otherwise; he 
shall deposit all monies and other valuable effects in the names and to 
the credit of the Exchange in such depositories as may be designated by 
the Board; he shall disburse the funds of the Exchange as may be 
ordered by the Board; he shall render to the Board when required by the 
Board an account of all his transactions as Treasurer and of the 
financial condition of the Exchange; he shall perform other duties as 
may be prescribed by the Board, [or the] Chairman of the Board or 
President.

Article IX

Indemnification

Section 9.1 Indemnification of Directors, Officers and Members of 
Committees

    The Exchange shall, to the fullest extent permitted by the law, 
indemnify any person who was or is threatened to be made a party to any 
threatened, pending or completed action, suit or proceeding, whether 
civil, criminal, administrative or investigative, by reason of the fact 
that he is or was a Director, officer or member of a

[[Page 74999]]

committee of the Exchange, or is or was serving at the request of the 
Exchange as a director or officer of another corporation, partnership, 
joint venture, trust or other enterprise, against all expenses 
(including attorneys' fees), judgment, fines and amounts paid in 
settlement actually and reasonably incurred by him in connection with 
such action, suit or proceeding.

Section 9.2 Contract with the Exchange

    The provisions of this Article IX shall be deemed to be a contract 
between the Exchange and each Director, officer or member of a 
committee of the Exchange who serves in any such capacity at any time 
while this Article is in effect, and any repeal or modification of any 
applicable law or of this Article IX shall not affect any rights or 
obligations then existing with respect to any state of facts then or 
theretofore existing or any action, suit or proceeding theretofore or 
thereafter brought or threatened based in whole or in part upon any 
such state of facts.

Section 9.3 Indemnification of Other Persons

    Persons not expressly covered by the foregoing provisions of this 
Article IX, such as those (a) who are or were employees or agents of 
the Exchange, or are or were serving at the request of the Exchange as 
employees or agents of another corporation, partnership, joint venture, 
trust or other enterprise, or (b) who are or were directors, officers, 
employees or agents of a constituent corporation absorbed in a 
consolidation or merger in which the Exchange was the resulting or 
surviving corporation, or who are or were serving at the request of 
such constituent corporation as directors, officers, employees or 
agents of another corporation, partnership, joint venture, trust or 
other enterprise, may be indemnified to the extent authorized at any 
time or from time to time by the Board.

Section 9.4 Other Rights of Indemnification

    The indemnification provided or permitted by this Article IX shall 
not be deemed exclusive of any other rights to which those indemnified 
may be entitled by law or otherwise, and shall continue as to a person 
who has ceased to be a Director, officer, employee or agent and shall 
inure to the benefit of the heirs, executors and administrators of such 
person.

Article X

Notices

Section 10.1 Notices

    (a) Any notice required to be given by the Constitution, the Rules 
or otherwise shall be deemed to have been given:
    (i) in person upon delivery of the notice [if delivered] in person 
to the person to whom such notice is addressed[,]; [and shall be deemed 
to have been given]
    (ii) by mail upon deposit of the notice [to any person entitled 
thereto at the time it shall have been deposited] in the United States 
mail, enclosed in a postage prepaid envelope[,]; [and shall be deemed 
to have been given by wireless, telegraph or cable when the same shall 
have been delivered for prepaid transmission into the custody of a 
company ordinarily engaged in the transmission of such messages]
    (iii) by messenger or overnight courier service upon provision of 
the notice to the messenger or courier service, provided that the 
delivery method does not require payment of the messenger or courier 
service fee to deliver the notice by the person to whom the notice is 
addressed;
    (iv) by facsimile machine upon acknowledgment by the facsimile 
machine used to transmit the notice of the successful transmission of 
the notice;
    (v) by electronic mail upon electronic transmission of the notice; 
and [shall be deemed to have been given]
    (vi) by telephone when received[,].
    Any such notice must be addressed to its intended recipient [such 
postage prepaid envelope or such wireless, telegraph or cable message 
being addressed to such person] at the intended recipient's [his] 
address (including the intended recipient's business or residence 
address, facsimile number, electronic address, or telephone number, as 
applicable) as it appears on the books and records of the Exchange, or 
if no address appears on such books and records, then at such address 
as shall be otherwise known to the Secretary, or if no such address 
appears on such books and records, then in care of the registered agent 
of the Exchange in the State of Delaware. In the event that a notice is 
not provided in conformity with the provisions of this Section, the 
notice will be deemed to have been given to its intended recipient upon 
any receipt of the notice by its intended recipient. Whenever, by any 
provisions of statute, the Certificate of Incorporation, the 
Constitution, the Rules or otherwise, any notice is required to be 
given any specified number of days before any meeting or event, the day 
on which such notice was given shall be counted but the day of such 
meeting or other event shall not be counted in determining whether or 
not notice has been given in proper time in a particular case.
    (b) The Exchange may provide to all members and associated persons 
by electronic mail only those notices provided in the Exchange Bulletin 
and Regulatory Bulletin and any other types of notices designated by 
the Board of Directors. If requested in a form and manner prescribed by 
the Exchange, the Exchange may permit members and associated persons to 
request that such notices be given by other means.

Section 10.2 Waiver of Notice

    Whenever notice is required to be given under the provisions of any 
statute, the Certificate of Incorporation, the Constitution, the Rules 
or otherwise, a written waiver thereof, signed by the person entitled 
to notice, or his proxy in the case of a member, whether before or 
after the time stated therein shall be deemed equivalent to notice. 
Except as may be otherwise specifically provided by statute, any waiver 
by mail, messenger, overnight courier, facsimile machine, or electronic 
mail [telegraph, cable or wireless], bearing the name of the person 
entitled to notice shall be deemed a written waiver duly signed. 
Attendance of a person at a meeting, including attendance by proxy in 
the case of a member, shall constitute a waiver of notice of such 
meeting except when the person attends a meeting for the express 
purpose of objecting, at the beginning of the meeting, to the 
transaction of any business the meeting is not lawfully called or 
convened. Except as required by statute, the Certificate of 
Incorporation, the Constitution or the Rules, neither the business to 
be transacted at, nor the purpose of, any regular or special meeting of 
the members, Directors or any committee need be specified in any 
written waiver of notice.

Article XI

General Provisions

Section 11.1 Fiscal Year

    The fiscal year of the Exchange shall be as determined from time to 
time by the Board.

Section 41.2 Checks, Drafts and Other Instruments

    All checks, drafts or other orders for the payment of money, notes 
or other evidences of indebtedness issued in the name of the Exchange 
shall be signed by such officer or officers, or by such agent

[[Page 75000]]

or agents of the Exchange and in such manner as the Board may from time 
to time determine.

[Section 11.3 Departments

    The Chairman of the Board, with the approval of the Board, is 
authorized to establish and maintain such departments as may be deemed 
necessary from time to time, and the Board shall make all needful 
regulations applicable thereto.]

[Section 11.4 Officers and Employees Restricted

    (a) Every salaried officer or employee of the Exchange, except the 
Vice Chairman of the Board, and every salaried officer or employee of 
any corporation in which the Exchange owns the majority of the stock, 
shall report promptly to the Exchange every purchase or sale for his or 
her own account or the account of others of any security which is the 
underlying security of any option contract admitted to dealings on the 
Exchange.
    (b) With the exception of the Vice Chairman of the Board, no 
salaried officer or employee of the Exchange or salaried officer or 
employee of any corporation in which the Exchange owns the majority of 
the corporate stock may purchase or sell for his or her own account or 
for the account of others any option contract which entitles the 
purchaser to purchase or sell any security described in paragraph (a) 
of this Section.
    (c) Paragraphs (a) and (b) above of this Section shall not be 
construed to preclude any salaried officer or employee of the Exchange 
or of any corporation in which the Exchange owns a majority of the 
stock from performing his duties and responsibilities as assigned to 
him by such organization.]

Article XII

Amendments

Section 12.1 Constitution

    The Constitution may be amended at any regular or special meeting 
of members by the affirmative vote of a majority of voting [the] 
members present in person or represented by proxy at the meeting.

Section 12.2 Rules

    The Rules may be amended by the affirmative vote of a majority of 
the Directors present at a meeting at which such amendment is proposed, 
provided, however, that promptly upon the adoption of an amendment to 
the Rules, notice thereof shall be sent to each member, and within 15 
days after such notice has been given, 150 or more voting members may 
request in writing that a special meeting of members be held to vote 
upon whether the amendment to the Rules shall be approved. The notice 
of the meeting shall state that the approval of such a proposed 
amendment will be considered.

Section 12.3 Effectiveness of Amendments

    Subject to applicable federal or state regulatory requirements, 
amendments to the Constitution shall be effective upon their adoption 
by the members, and amendments to the Rules shall be effective at the 
expiration of the 15-day notice period, or, if a special meeting of 
members has been requested to vote upon the amendment or if the 
amendment otherwise requires membership approval, at the time the 
amendment is approved by the requisite vote of the members; provided, 
however, that, except in the case of a Rule that expressly requires 
amendments to be approved by the membership or by a class of members, 
the Board may declare an amendment to the Rules effective immediately 
upon its adoption by the Board whenever the Board determines that, 
under the circumstances, such accelerated effectiveness is appropriate. 
Any amendment to the Rules which is declared effective by the Board 
upon its adoption nevertheless remains subject to being voted upon at a 
special meeting of members in accordance with Section 12.2, and any 
such amendment which is so voted upon but not approved shall be 
rescinded and shall cease to be effective from and after the time of 
its failure to be approved by the members. The rights and obligations 
of persons who rely in good faith on an amendment to the Rules declared 
immediately effective by the Board shall not be affected in the event 
such amendment is subsequently disapproved by the members.
* * * * *

Rules

Chapter II--Organization and Administration

Committees of the Exchange

    RULE 2.1 (a) Establishment of Committees. In addition to committees 
specifically provided for in the Constitution, there shall be the 
following committees: Appeals, Arbitration, Business Conduct, 
appropriate Floor Procedure Committees, Floor Officials, appropriate 
Market Performance Committees, Membership, Product Development and such 
other committees as may be established in accordance with the 
Constitution. Except as may be otherwise provided in the Constitution 
or the Rules, the Vice Chairman of the Board, with the approval of the 
Board, shall appoint the chairmen and members of such committees to 
serve for terms expiring at the first regular meeting of the Board of 
Directors [following the next succeeding Annual Election Meeting or] of 
the next calendar year and until their successors are appointed or 
their earlier death, resignation or removal. Consideration shall be 
given to continuity and to having, where appropriate, a cross section 
of the membership represented on each committee. Except as may be 
otherwise provided in the Constitution or the Rules, the Vice Chairman 
of the Board may, at any time, with or without cause, remove any member 
of such committees. Any vacancy occurring in one of these committees 
shall be filled by the Vice Chairman of the Board for the remainder of 
the term. Notwithstanding the foregoing, the Chairman of the Board, 
with the approval of the Board, shall appoint Directors to serve on the 
Audit and Compensation Committees, whose members shall not be subject 
to removal except by the Board. Whenever the Vice Chairman of the Board 
is, or has reason to believe he may become, a party to any proceeding 
of an Exchange committee, he shall not exercise his power to appoint or 
remove members of that committee, and the Chairman of the Board shall 
have such power.
    (b) Committee Procedures. Except as otherwise provided in the 
Constitution, the Rules or a resolution of the Board, each committee 
shall determine the time and manner of conducting its meetings, and the 
vote of a majority of the members of a committee voting [present] at a 
meeting at which a quorum is present shall be the act of the committee. 
Committees may act informally by written consent of all of the members 
of the committee.
    (c)-(d) No Changes.
* * * * *

Chapter VIII--Market Makers, Trading Crowds and Modified Trading 
Systems

MTS Committee

    RULE 8.82. (a) The MTS Committee shall consist of the Vice-Chairman 
of the Exchange, the Chairman of the Market Performance Committee, and 
nine persons [members] elected by the membership of the Exchange.
    (b) The nine elected MTS Committee members shall include: three 
[four] members whose primary business is as a Market-Maker;[,] three 
[two] members

[[Page 75001]]

whose primary business is as a Market-Maker or as a DPM Designee;[,] 
and three [one] members whose primary business is as a Floor Broker, at 
least two of whom represent public customer orders in the course of 
their activities as a Floor Broker[and who is not associated with a 
member organization that conducts a public customer business, and two 
persons associated with member organizations that conduct a public 
customer business. No more than two of the nine elected MTS Committee 
members may be associated with a DPM]. One of the nine elected 
positions on the MTS Committee may instead be filled by a person (i) 
who directly or indirectly owns and controls a membership with respect 
to which the person acts as a lessor, (ii) whose primary business is 
not as a Market-Maker, DPM Designee, or Floor Broker, and (iii) whose 
primary residence is located within 80 miles of the Exchange's trading 
floor. No elected member of the MTS Committee may be affiliated (as 
defined under Rule 1.1(j)) with any other elected member of the MTS 
Committee. The nine elected MTS Committee members shall have three-year 
terms, three of which shall expire each year.
    (c) The election procedures for the nine elected MTS Committee 
members shall be the same as the election procedures for elected 
Directors that are set forth in Article IV and Article V of the 
Exchange Constitution. Accordingly, the following shall occur as part 
of these procedures: [During October of each year, the] The Nominating 
Committee shall select nominees to fill expiring terms and vacancies on 
the MTS Committee. Nominations may also be made by petition, signed by 
not less than 100 voting members and filed with the Secretary of the 
Exchange no later than 5:00 p.m. (Chicago time) on the Monday preceding 
the 1st Friday in November, or the first business day thereafter in the 
event that Monday occurs on a holiday. The election to fill the 
expiring terms and vacancies on the MTS Committee shall be held as part 
of the annual election. The term of office of each MTS Committee member 
elected at an annual election meeting shall commence at the time of the 
first regular Board of Directors meeting of the calendar year following 
that annual election meeting and shall continue until the first regular 
Board meeting of the third succeeding calendar year. Elected MTS 
Committee members shall hold office for the terms for which they are 
elected and until their successors are duly elected and qualified or 
until their earlier death, resignation, or removal.
    (d) Candidates for election to the MTS Committee, whether nominated 
by the Nominating Committee or by petition, shall be eligible for 
election in any of the categories for which they qualify both at the 
time of their nomination and at the time of their election. The sole 
judge of whether a candidate satisfies the applicable qualifications 
for election to the MTS Committee in a designated category shall be the 
Nominating Committee in the case of candidates nominated by the 
Nominating Committee, and shall be the Executive Committee in the case 
of candidates nominated by petition, and the decision of the respective 
committee shall be final. In the event a person's status changes 
following election to the MTS Committee, the sole judge of whether the 
person continues to satisfy the applicable qualifications for service 
on the MTS Committee shall be the Board of Directors.
    (e) In the event of the refusal, failure, neglect, or inability of 
any MTS Committee member to discharge that person's duties, or for any 
cause affecting the best interests of the Exchange, the sufficiency of 
which the Board of Directors shall be the sole judge, the Board shall 
have the power, by the affirmative vote of at least two-thirds of the 
Directors then in office, to remove that MTS Committee member from the 
Committee.
    (f) Any vacancy occurring among the members of the MTS Committee 
may be filled by a qualified person appointed by the Vice Chairman of 
the Board with the approval of the Board of Directors. The term of any 
MTS Committee member so chosen shall be from the date of appointment 
until the first regular Board meeting of the calendar year following 
the next annual election meeting and until the person's successor is 
duly elected and qualified, or until the person's earlier death, 
resignation, or removal. The remaining portion of the unexpired term of 
an MTS Committee member, if any, shall be served by a person elected at 
the next annual election meeting.
* * * * *

Chapter IX--Doing Business With the Public

* * * * *

Transactions of Certain Customers

    RULE 9.17. No member organization shall execute any transaction in 
securities or carry a position in any security in which (a) an officer 
or employee of the Exchange, [or any other national securities exchange 
which is a participant of the Clearing Corporation,] or an officer or 
employee of a corporation in which the Exchange [or such other 
exchange] owns the majority of the capital stock is directly or 
indirectly interested, without the prior written consent of the 
Exchange, or (b) a partner, officer, director, principal shareholder or 
employee of another member organization is directly or indirectly 
interested, without the consent of such other member organization. 
Where the required consent has been granted, duplicate reports of the 
transaction and position shall be promptly sent to the Exchange or 
member organization, as the case may be.
* * * * *

    \1\ Prior to the 2002 annual election meeting, the three classes 
of Directors elected by the membership are composed as follows: 
Class I: one floor director, one at-large director, one lessor 
director, two off-floor directors, and two public directors; Class 
II: one floor director, one at-large director, two off-floor 
directors, and three public directors.

* * * * *

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

    In its filing with the Commission, CBOE included statements 
concerning the purpose of, and basis for, the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. CBOE has prepared summaries, set forth in Sections A, B, 
and C below, of the most significant aspects of such statements.

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

1. Purpose
    CBOE states that the purpose of the proposed rule change is to make 
certain revisions to provisions of the Exchange's Constitution and 
rules pertaining to the governance of the Exchange. These proposed 
changes are intended to further enhance the fair and efficient 
governance of the Exchange and modernize various provisions of the 
Exchange's governance structure.
    With respect to Constitution provisions relating to the Board of 
Directors and the Vice Chairman of the Board, the proposed rule change 
amends Constitution Sections 6.1(b), 6.4, and 8.1 to specify that 
Directors and the Vice Chairman take office on January 1st. Currently, 
the Constitution

[[Page 75002]]

provides that the term of office of Directors starts at the first 
regular meeting of the Board held after January 1 following the annual 
election, and continues until their successors are duly elected and 
qualified, whereas the term of office of the Vice Chairman starts on 
the 3rd Friday in December of each year, assuming the incoming 
candidate is qualified on that date, and continues until his successor 
is duly chosen and qualified.
    The proposed rule change also amends Constitution Section 6.3(b) to 
provide the later of 45 days or until the next regular Board meeting 
for a Director who fails to maintain qualifications for a designated 
category to requalify. During any period in which a Director fails to 
maintain qualifications for a designated category, the Director shall 
be deemed not to hold office and the seat formerly held by the Director 
shall be deemed vacant for all purposes.
    With respect to Constitution provisions relating to the Exchange's 
Nominating Committee, the proposed rule change amends Section 4.1(b) to 
exempt members of the Nominating Committee who have not served a full 
3-year term from the Constitutional provision that provides that 
``Elected members of the Nominating Committee shall be ineligible for 
reelection for a period of three years after their terms expire.'' This 
amendment will allow a member of the Nominating Committee who was 
elected to a short term as a result of a vacancy to stand for 
reelection.
    The proposed rule change also amends Constitution Section 4.3 to 
delete the requirement that the Nominating Committee must hold three 
meetings in October, and also to require that the Nominating Committee 
announce its slate of candidates not later than October 10th or the 
first business day thereafter if the 10th is not a business day.
    The proposed rule change also adopts new Constitution Section 4.8 
to require that members of the Nominating Committee shall meet the 
eligibility criteria for the category to which they were elected 
(floor, firm, lessor or public member) continuously and not only during 
the time periods in which the Nominating Committee is in session. New 
Section 4.8 also specifies that the sole judge of whether a Nominating 
Committee member satisfies the qualification criteria for the category 
to which the committee member was elected is the Board of Directors. In 
addition, this new Section also provides that a member of the 
Nominating Committee who fails to maintain the applicable 
qualifications has 45 days from the date the Board determines the 
member is not qualified to requalify.
    The proposed rule change also adopts new Constitution Section 4.9 
which specifies that the Board may remove Nominating Committee members 
in the event of the refusal, failure, neglect, or inability of any 
Nominating Committee member to discharge that person's duties, or for 
any cause affecting the best interests of the Exchange. This proposed 
new Section 4.9 is consistent with Constitution Section 6.3(c), which 
allows the Board to remove a Director for cause.
    With respect to the election and voting procedures for membership 
votes, the proposed rule change adopts new Constitution Section 3.8 to 
authorize the Board to set a ``record date'' to determine those members 
who are entitled to receive notice and to vote in any Exchange 
election/vote. The record date would be the day preceding the date on 
which notice of the vote is given, if an alternate record date is not 
fixed by the Board. An individual or organization must be an effective, 
voting member on the record date to cast a ballot in an election or 
membership vote.
    The proposed rule change also amends Constitution Section 5.2 to 
provide that the Exchange may allow voting members to electronically 
submit ballots and proxies. This amendment would also provide the 
flexibility to allow for a confidential electronic or on-line voting 
process in the future, if the Board determines to do so.
    With respect to the communication methods by which the Exchange may 
provide notice to members, the proposed rule change amends Constitution 
Section 10.1 to allow the Exchange to give notice to members and 
associated persons by messenger, courier service, facsimile or 
electronic mail (``e-mail''), as well as in-person or by mail or 
telephone as is currently provided in Section 10.1. The proposed rule 
change deletes wireless, telegraph, and cable as available 
communication methods. In addition, the Board proposes to amend 
Constitution Section 10.2 to allow for waiver of notice by the same 
means as notice may be given. Amending these sections will modernize 
and make more flexible the Constitutional requirements with respect to 
notice and waiver of notice.\3\
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    \3\ Currently, the Constitution does not allow the Exchange to 
provide notice via e-mail or facsimile, unless a member submits a 
waiver of notice. For example, the Constitution and Rules, in 
certain specific instances, require the Exchange to provide notice 
to members. To satisfy these requirements, the Exchange gives notice 
to members via the Exchange Bulletin and the Regulatory Bulletin, 
which are mailed to all effective members unless a member submits a 
written consent to provision of the Bulletins by e-mail.
---------------------------------------------------------------------------

    The proposed rule change also adopts new Constitution Section 
10.1(b) which limits the types of notices that may be given via email 
to only those notices provided in the Exchange Bulletin and Regulatory 
Bulletin and any other types of notices designated by the Board. 
Constitution Section 10.1(b) specifically provides that the Exchange 
may provide the Exchange Bulletin and the Regulatory Bulletin 
(including the notices contained therein) by email. This section also 
allows the Exchange to permit members and associated persons to request 
delivery of the Bulletins (or such other notices as the Board may 
designate) by other means, in a form and manner prescribed by the 
Exchange.
    The proposed rule change also deletes Constitution Section 11.4, 
which prohibits officers and employees of the Exchange (except the Vice 
Chairman of the Board) from trading any option listed on CBOE. Section 
11.4 also requires officers and employees to report to the Exchange 
every purchase or sale of any security underlying an option listed on 
CBOE. The above trading restriction and reporting requirement are also 
set forth in the Exchange's Employee Conflict of Interest Policy. Upon 
the deletion of Section 11.4, the Exchange proposes to liberalize the 
securities transaction policies to allow employees (with certain 
restrictions applicable to Regulatory Services Division employees) to 
trade CBOE listed products and to require employees to report 
transactions in CBOE listed products to the Exchange. The securities 
transaction policy would be included solely in the Exchange Employee 
Handbook, rather than the Exchange's Constitution.\4\
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    \4\ A copy of CBOE's securities transaction policies, as 
proposed to be amended in connection with the deletion of 
Constitution Section 11.4, was provided to the Commission for its 
information but is not a rule change and thus was not included as 
part of this rule filing.
---------------------------------------------------------------------------

    In connection with the foregoing change, the Exchange also proposes 
to amend Exchange Rule 9.17 to delete the requirement that a member 
organization must obtain authorization from the CBOE before executing 
securities transactions for officers or employees of any national 
securities exchange that is a participant of the Clearing Corporation. 
The rule will continue to require member organizations to obtain such 
authorization from the CBOE before executing securities transactions 
for CBOE officers and employees.

[[Page 75003]]

    With respect to CBOE rules relating to the MTS Committee, the 
proposed rule change proposes to amend Rule 8.82 to provide that the 
nine elected MTS Committee members will include: Three persons whose 
primary business is as a Market-Maker, three persons whose primary 
business is as a Market-Maker or as a DPM Designee, and three persons 
whose primary business is as a Floor Broker, at least two of whom 
represent public customer business in the course of their activities as 
a Floor Broker. The Vice Chairman of the Exchange and the Chairman of 
the Market Performance Committee will continue to serve on the MTS 
Committee.\5\ The amendment to Rule 8.82 also provides that one of the 
nine elected positions on the MTS Committee may be filled by a lessor 
whose primary business is not as a Market-Maker, DPM Designee, or Floor 
Broker, and whose primary residence is located within 80 miles of the 
Exchange's trading floor. This distance is equivalent to the distance 
requirement for certain off-floor Directors under Constitution Section 
6.1. Because the MTS Committee meets frequently, it is important that 
its members reside locally to be available for regular and impromptu 
meetings.
---------------------------------------------------------------------------

    \5\ Currently, Rule 8.82 provides that the MTS Committee is 
comprised of the Vice Chairman, the Chairman of the Market 
Performance Committee, and nine elected members as follows: Four 
members whose primary business is as a Market-Maker, two members 
whose primary business is as a Market-Maker or as a DPM Designee, 
one member whose primary business is as a Floor Broker and who is 
not associated with a member organization that conducts a public 
customer business, and two persons associated with member 
organizations that conduct a public customer business.
---------------------------------------------------------------------------

    Further, the proposed amendments to Rule 8.82 provide that: (i) No 
elected member of the MTS Committee may be affiliated with (as defined 
under CBOE Rule 1.1(j)) any other elected member of the MTS Committee; 
(ii) the term of office of elected MTS Committee members will commence 
at the time of the first regular Board meeting of the calendar year; 
(iii) the Board of Directors is the sole judge of whether or not an MTS 
Committee member no longer qualifies to serve on the Committee; (iv) 
the Board may remove MTS Committee members for cause; and (v) the Vice 
Chairman, with the approval of the Board, may fill vacancies on the MTS 
Committee until the first regular Board meeting of the calendar year 
following the next annual election.
    The proposed rule change also amends CBOE Rule 2.1 to provide that 
the term of office for committee members who are appointed pursuant to 
that rule will continue until the first regular Board meeting of the 
next calendar year and until their successors are appointed or until 
death, resignation or removal. The proposed rule change also amends 
Rule 2.1 to provide that a majority of the committee members voting, as 
opposed to present, at a meeting shall be the act of the committee.
    Finally, the proposed rule change proposes to make several changes 
to the Exchange's Constitution and rules that are housekeeping in 
nature and designed to modernize and clarify the Exchange's 
Constitution and rules, and update the Constitution and rules to 
reflect current rules and practice. Specifically, the proposed rule 
change:
    [sbull] Amends Constitution Sections 1.1(c) and 2.3 to include the 
concept of leased memberships, as well as owned memberships, in the 
definition of member organizations and the requirement that member 
organizations designate an individual nominee to be consistent with the 
Constitution's provisions and Exchange rules.
    [sbull] Amends Constitution Sections 2.1(a) and 12.1 to add 
``voting'' to the term ``members'' to clarify who may vote at a 
membership meeting.
    [sbull] Amends Constitution Section 3.1 to specify that membership 
meetings will take place on the 4th floor of the Exchange (as opposed 
to on the trading floor), unless otherwise determined by the Secretary, 
to conform to current practice.
    [sbull] Amends Constitution Section 3.2 to provide that the annual 
election meeting will be held on the 1st business day preceding the 3rd 
Friday in November (rather than on the 3rd Friday).
    [sbull] Amends Constitution Sections 3.2 and 3.3 to specify that 
the Secretary, rather than the Board, will determine the time of the 
annual election and annual report meetings, because the Board does not 
generally become involved in this level of detail with respect to 
membership meetings.
    [sbull] Amends Constitution Section 3.3 to clarify that the purpose 
of the annual report meeting is to present the Exchange's annual 
report.
    [sbull] Amends Constitution Section 3.5 to specify that written 
notice of each membership meeting at which a vote will be taken shall 
be ``given'' (rather than ``delivered'') to each member entitled to 
vote not more than 60 days and at least 10 days before the date of the 
meeting to be consistent with Delaware law.
    [sbull] Amends Constitution Sections 4.1 and 6.1 and Rule 8.82 to 
make it clear whether the term ``member'' in the eligibility criteria 
for the Board of Directors, the Nominating Committee, and the MTS 
Committee is referring to a ``member of the Exchange'' or a ``member of 
the Board or Committee,'' as applicable.
    [sbull] Amends Constitution Sections 4.1 and 4.2 to clarify that a 
Nominating Committee member's term ends upon the expiration of his/her 
term or upon the Nominating Committee member's death, resignation or 
removal.
    [sbull] Amends Constitution Sections 4.3, 4.6, 5.3 and 8.9 to 
clarify and make consistent references requiring the posting of 
information on the Exchange bulletin board.
    [sbull] Amends Constitution Sections 5.2 and 5.3 to be consistent 
with the current procedures for the receipt, verification and counting 
of ballots.
    [sbull] Amends Constitution Section 6.7 to allow the Exchange to 
provide notice of a special Board meeting to each Director either in 
person, by mail, messenger, overnight courier, facsimile machine, e-
mail, telephone, or announcement on the Exchange trading floor. The 
amendment proposes to delete telegram and cablegram as methods of 
notice to directors for special Board meetings.
    [sbull] Amends Constitution Section 8.1 to provide that the vote to 
elect a Vice Chairman of the Board (if any) will be held on the 1st 
business day preceding the 3rd Friday in December (rather than the 3rd 
Friday) and to clarify that the Board does not have to reappoint all 
officers at the beginning of each year.
    [sbull] Amends Constitution Section 8.4 to clarify, consistent with 
Constitution Section 8.1(a), that if a vacancy occurs in the office of 
Chairman, the Board shall appoint a new Chairman by the affirmative 
vote of at least two-thirds of the Directors then in office.
    [sbull] Amends Constitution Section 8.6 to specifically allow the 
Board to grant an exemption to the prohibition against the President 
engaging in any other business in the same manner that the Board may 
grant such an exemption to the Chairman of the Board pursuant to 
Constitution Section 8.2.
    [sbull] Amends Constitution Sections 8.6, 8.7(b), 8.8, 8.9 and 8.10 
to update the Constitution with respect to officer duties and 
responsibilities (i.e., clarify that the President shall be required to 
approve all contracts on behalf of the Exchange but may delegate 
responsibility for executing contracts, specify when the Secretary must 
maintain records of meetings, specify that the Chairman of the Board 
and the President, as well as the Board, may remove any officer, 
clarify that the President may assign duties to officers, and move the 
duty to collect all monies due the Exchange from the Secretary to the 
Treasurer).

[[Page 75004]]

    [sbull] Deletes Constitution Section 11.3, which authorizes the 
Chairman of the Board to establish Exchange departments. The section is 
unnecessary because the authority is encompassed within the Chairman's 
responsibility as Chief Executive Officer and inconsistent with the 
Exchange's current organizational structure, which consists of 
divisions made up of departments.
2. Statutory Basis
    CBOE believes that the proposed rule change further enhances the 
fair and efficient governance of the Exchange and modernizes various 
provisions of the Exchange's governance structure. Therefore CBOE 
believes the proposed rule change furthers the objectives of section 
6(b)(3) of the Act \6\ to assure fair representation of the members of 
the Exchange in the selection of its directors and in the 
administration of its affairs. CBOE also believes that the proposed 
rule change furthers the objectives of section 6(b)(5) of the Act \7\ 
to protect investors and the public interest.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b)(3).
    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

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

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

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

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve such proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposal, as 
amended, is consistent with the Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. 
Comments should be submitted electronically at the following e-mail 
address: [email protected]. All comment letters should refer to 
File No. SR-CBOE-2003-55. This file number should be included on the 
subject line if e-mail is used. To help the Commission process and 
review your comments more efficiently, comments should be sent in hard 
copy or by e-mail but not by both methods. Copies of the submission, 
all subsequent amendments, all written statements with respect to the 
proposed rule change that are filed with the Commission, and all 
written communications relating to the proposed rule change between the 
Commission and any person, other than those that may be withheld from 
the public in accordance with the provisions of 5 U.S.C. 552, will be 
available for inspection and copying in the Commission's Public 
Reference Room. Copies of such filing will also be available for 
inspection and copying at the principal office of CBOE. All submissions 
should refer to File No. SR-CBOE-2003-55 and should be submitted by 
January 20, 2004.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-31804 Filed 12-24-03; 8:45 am]
BILLING CODE 8010-01-P