01
Chicago Board Options Exchange Annual Report 2001
cv2 CBOE ‘01
CBOE is the largest and
most successful options
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marketplace in the world.
ifc1 CBOE ‘01
ONE HAS OPPORTUNITIES
The NUMBER ONE Options Exchange provides customers with a wide selection of products
to achieve their unique investment goals.
ONE HAS RESPONSIBILITIES
The NUMBER ONE Options Exchange is responsible for representing the interests of its
members and customers. Whether testifying before Congress, commenting on proposed
legislation or working with the Securities and Exchange Commission on finalizing regulations,
the CBOE weighs in on behalf of options users everywhere. As an advocate for informed
investing, CBOE offers a wide array of educational vehicles, all targeted at educating investors
about the use of options as an effective risk management tool.
ONE HAS RESOURCES
The NUMBER ONE Options Exchange offers a wide variety of resources beginning with a
large community of traders who are the most experienced, highly-skilled, well-capitalized
liquidity providers in the options arena. In addition, CBOE has a unique, sophisticated hybrid
trading floor that facilitates efficient trading.
01 CBOE ‘01
2 CBOE ‘01
“
TO BE THE LEADING MARKETPLACE FOR FINANCIAL DERIVATIVE PRODUCTS, WITH FAIR AND EFFICIENT
MARKETS CHARACTERIZED BY DEPTH, LIQUIDITY AND BEST EXECUTION OF PARTICIPANT ORDERS.”
CBOE MISSION
LETTER FROM THE OFFICE OF THE CHAIRMAN
SINGLE-DAY RECORD
VOLUME: 2,726,267
CBOE HAS 40.5%
OF TOTAL OPTIONS
MARKET SHARE
CONSOLIDATION
Unprecedented challenges and a need for strategic agility
characterized a positive but demanding year in the overall options
marketplace. The Chicago Board Options Exchange® (CBOE®)
enjoyed a record-breaking fiscal year, with a 2.2% growth in contracts
traded when compared to Fiscal Year 2000, also a record-breaker.
In addition, a record for fiscal year average daily volume was set in
2001 with an average of 1,271,240 contracts traded daily, an increase
of 3.4% over FY 2000. During the week of April 16, 2001, CBOE
experienced three of the four busiest trading days in our history.
The single-day record for trading volume was set on Wednesday,
April 18, 2001 when 2,726,267 contracts traded. April 18 marked only
the second time in the history of the Exchange that total volume
surpassed two and one-half million contracts.
Due to the commitment of CBOE’s membership, the listing of new
and attractive products, and exemplary customer service, CBOE
retained its leadership position within the options industry in Fiscal
Year 2001, capturing a healthy 40.5% of total options market share,
38.5% of equity options market share and 53.7% of index options
market share. It is a market position that founders of many other
industries would be thrilled to occupy 28 years after their first days
in business, but it is not an acceptable position to us. Despite volume
gains, unrelenting competitive forces eroded overall market share in
FY 2001—a situation that CBOE is taking aggressive steps to remedy.
As the number one options exchange in the world for almost three
decades, CBOE is positioned as both the emulated leader and the
primary target for all competitors.
As competitive pressures mounted, market makers and member
firms devised strategies to combat them. Many of CBOE’s smaller,
independent market-making firms were either acquired or became
affiliated with larger firms in order to best service customers as
consolidation swept the options industry. Consolidation allowed
for the economies of scale so essential to success in today’s
global economy.
03 CBOE ‘01
EFFORTS TO ATTRACT
CUSTOMERS
SINGLE-STOCK
FUTURES
JOINT VENTURE
In support, CBOE redoubled its efforts to attract customers and
provide members with additional tools to service customer needs.
Significant, attractive products were listed, a milestone joint venture
was created and sophisticated technological advancements were
introduced to facilitate trading. Marketing strategies were devised to
provide traders and investors with a broader menu of products and
services to suit varying portfolio goals.
A Strategic Planning Task Force was formed to examine the com-
petitive landscape, which had already shifted dramatically since
the recommendations of CBOE’s last strategic review in 1999
were implemented.
As we move forward, it is important to recognize that we have remained
the number one options exchange because we have adhered to
principles of unwavering commitment to excellence and service, and
refused to rest complacently on past achievements. As the premier
options exchange in the world, we have unparalleled opportunities,
responsibilities and resources. We will continue to stay number one
by living up to them all.
OPPORTUNITIES
In FY 2001, CBOE placed special emphasis on creating opportunities
and expanding markets, both for investors and market makers.
History was made when Congress, late in 2000, passed legislation
allowing for the trading of futures on single stocks. Key issues for
which we lobbied were included in the legislation, such as the ability
to trade the products either as a security or a future.
CBOE, Chicago Mercantile Exchange Inc. and Chicago Board of Trade
formed a joint venture to trade single-stock futures contracts. The
joint venture will be a for-profit company with its own management
and board and will be separately organized as a regulated exchange.
On August 29, 2001, the joint venture announced the appointment
of William J. Rainer to serve as chairman and chief executive officer.
Rainer, former chairman of the Commodity Futures Trading Com-
mission, is a co-founder and former managing director of Greenwich
Capital Markets, Inc., a primary dealer of government securities.
Single-stock futures provide another opportunity for both our
members and customers. We anticipate that members will be able
to begin trading single-stock futures contracts through the joint
venture early in 2002.
04 CBOE ‘01
Total Volume and Open Interest
Fiscal Years
79,769,523
44,947,915
23,668,551
18,368,242
14,135,316
221,256,576
196,304,017
172,275,136
319,081,344
312,182,108
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
300
320
Volume
Open Interest
Average Daily Volume
Fiscal Years
1,271,240
1,229,063
878,002
778,984
680,929
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
2001
2000
1999
1998
1997
2001
2000
1999
1998
1997
Total Options Market Share
Fiscal Year 2001
Equity Options Market Share
Fiscal Year 2001
Index Options Market Share
Fiscal Year 2001
ISE 3.9%
PHLX 13.1%
PCX 14.0%
ISE 4.1%
PHLX 14.3%
PCX 15.8%
CBOE
40.5%
ISE 2.2%
PCX 2.9%
PHLX 5.3%
CBOE
38.5%
CBOE
53.7%
AMEX 28.5%
AMEX 27.3%
AMEX 35.9%
6 CBOE ‘01
Several significant new products were listed in FY 2001 to help
investors further diversify their portfolios. These include:
CBOE Mini-NDX (MNX SM), launched on August 14, 2000. This index
option is based on one-tenth of the value of the Nasdaq-100 Index®.
iSharesSM S&P 100® Index Fund (OEF) began trading exclusively at
CBOE on October 27, 2000. iShares are exchange-traded securities
that trade like stocks, but with the advantages of index trading.
They are designed to generally correspond to the performance of
the S&P 100 Index.
Options on iSharesSM S&P 100 Index Fund (OEF) began trading on
February 7, 2001.
Options on Nasdaq-100 Index Tracking StockSM (QQQ) began trading
on February 27, 2001. The Nasdaq-100 Index Tracking Stock
represents ownership in the Nasdaq-100 Trust,SM a long-term unit
investment trust established to accumulate and hold a portfolio
of the equity securities that comprise the Nasdaq-100 Index ®.
Nasdaq-100 Index Tracking Stock (QQQ) began trading at CBOE on
August 1, 2001. The QQQ shares are one of the most actively traded
Exchange Traded Funds (ETF) in the world.
CBOEdirect, CBOE’s new screen-based trading system, is scheduled
to be launched on October 26, 2001. Not just an order matching
system, CBOEdirect actually replicates CBOE’s trading floor on a
screen, with liquidity providers making two-sided, continuous markets.
An unprecedented technological achievement, CBOEdirect provides
access to an entire options universe on a screen-based system.
NEW PRODUCTS
LISTED
MNX SM
iSHARES SM
QQQ
CBOEdirect™
MNX Volume by Month
Fiscal Year 2001
06.01
05.01
04.01
03.01
02.01
01.01
12.00
11.00
10.00
09.00
08.00
639,202
683,177
641,548
505,667
551,140
554,804
347,914
358,399
342,940
258,126
160,497
0
.05
.10
.15
.20
.25
.30
.35
.40
.45
.50
.55
.60
.65
.70
07 CBOE ‘01
Volume Records
Fiscal Year 2001
01.19.01
2,196,769
Single-Day Equity Volume
02.07.01
234,222
Individual Equity Single-Day Volume: Cisco
03.01
2,211,781
QQQ Monthly Volume
03.08.01
328,796
QQQ Single-Day Volume (options)
04.01
1,177,763
DJX Monthly Volume
04.18.01
2,726,267
Single-Day Trading Volume
6 of the 10 busiest single trading days in the history of the
Exchange were set in FY 2001—including the top 4: 2,726,267
on 04.18.01, 2,640,244 on 04.20.01, 2,415,824 on 04.19.01,
and 2,391,788 on 01.19.01.
05.01
06.07.01
683,177
827,500
MNX Monthly Volume
iShares Single-Day Volume (shares)
The system will run from 7:00 a.m.– 8:15 a.m. Screen-based trading
will be conducted initially in the Dow Jones Industrial AverageSM
Index options (DJX), followed by the Russell 2000® Index options (RUT)
and the S&P 100® Index options (OEX®). The new system provides the
opportunity to trade these popular products electronically outside
of normal trading hours.
RESPONSIBILITIES
As an advocate for investor rights and for fair regulation, CBOE
takes an active role in ensuring that competition in the derivatives
marketplace flourishes on a level playing field. As a business and
training model for exchanges around the world, CBOE’s efforts are
unparalleled. CBOE has invested considerable resources in developing
extensive educational tools that help investors and options profes-
sionals hone their investing skills.
CBOE was at the vanguard in ensuring that any legislation proposed
that would permit trading of single-stock futures contracts would
be enacted only after the concerns of the options industry and
options customers were satisfactorily addressed. Due in great part
to CBOE’s efforts, key issues were resolved in the Commodity
Futures Modernization Act prior to passage of the final legislation.
Most significantly, stock futures can be traded either as a security
or a future. Other issues resolved before the bill’s passage included
comparable margins between stock futures and stock options,
transaction fees that apply to stock futures trading on a securities
08 CBOE ‘01
ADVOCACY
RECENT LEGISLATION
SECTION 31 FEES
DECIMALS
INTERMARKET
LINKAGE
exchange or a futures exchange, choice of physical or cash settle-
ment, and comparable federal tax treatment for options and
single-stock futures.
As a vocal advocate for fairness in the marketplace, CBOE
campaigned for legislation that would eliminate Section 31 fees
applicable to options on broad-based stock indices. These fees
were intended to fund the SEC; yet, the government currently
collects several times over the SEC’s budget. In addition, these fees
are not imposed on futures and futures options based on stock
indices, although these products compete directly with options on
broad-based stock indices.
The U.S. House of Representatives has passed a bill (H.R. 1088) on
Section 31 fees, and at the time this report was published, the bill
was being considered in the U.S. Senate.
On April 9, 2001, CBOE completed an extensive conversion process
that enabled trading of all options classes in decimals. Conversion
to decimals was mandated by the Securities and Exchange
Commission, and all U.S. stocks and exchange-traded options
now trade in decimals.
Additionally, as a step toward establishing permanent intermarket
linkage between the options exchanges, the Securities and
Exchange Commission approved an interim intermarket linkage
program to facilitate members’ electronic access between the
options exchanges. The first interim linkage in the industry began
at CBOE on April 25, 2001.
09 CBOE ‘01
CBOE.COM
152 MILLION
PAGE VIEWS
THE OPTIONS
INSTITUTE
ACCOUNTABILITY
DPM ASSOCIATION
EXPANDED
TECHNOLOGIES
One of the most comprehensive and widely-accessed resources
provided by CBOE is a completely redesigned website, www.cboe.com,
which debuted in June, 2001. At the heart of the new cboe.com is a
unique personalized engine called MyCBOE. Investors can use this
customization tool to ensure that only relevant options and market
information are delivered to them—all on one convenient page.
CBOE’s website was named “Best of the Web” in the options field by
Forbes.com, and was cited for its excellent educational features by
TheStreet.com. CBOE’s website logged 152 million page views in
FY 2001, a 17% increase over the previous fiscal year.
Functioning as the educational arm of CBOE, The Options Institute
is an invaluable resource industry-wide for training a broad range
of investors and professionals associated with the investing field. In
FY 2001, the Options Institute held 364 classes, educating 18,754
individuals including individual investors, institutional investors,
brokers, trading floor and firm employees, financial advisors and
regulatory personnel.
RESOURCES
As the first, oldest and largest options exchange in the world,
CBOE drew on its extensive experience to develop sophisticated
resources that facilitate speed, deep liquidity and efficiency in
the trading process.
To offer immediate access to a floor contact and to provide a single
point of accountability for customers, CBOE members voted in 1999
to expand the “DPM system” to all equity options. CBOE first
introduced the DPM (Designated Primary Market Maker) program
in 1987. Since then, CBOE market makers and DPMs have enabled
the Exchange to grow amidst heightened competition. The DPM
Association of Chicago was formed in April of 2000. It is an inde-
pendent association composed of many of CBOE’s DPMs. The DPM
Association streamlines communication by providing a single point
of contact for the investing community with the majority of Chicago’s
DPMs. Offering a vast depth of options trading expertise, the DPM
Association is committed to market liquidity, best execution and
market quality.
CBOE has one of the most technologically-advanced trading floors
in the world. During FY 2001, CBOE increased flexibility and further
expanded access to many of the existing automated systems. CBOE
continued its technology leadership with a number of innovations.
Advances like automated book priority, options quotes with size and
10 CBOE ‘01
11 CBOE ‘01
HYBRID TRADING
FLOOR
BEST EXECUTION
VXN SM
improvements to RAES (Retail Automatic Execution System) provided
CBOE’s customers with the full service they expect from a trading floor
combined with the speed and efficiency of an electronic marketplace.
CBOE provides efficient mechanisms to facilitate seamless
trading. Eighty-eight percent of all executions are routed and
conducted electronically.
CBOE combines the advantages of cutting-edge technology with the
benefits of open outcry to produce an efficient, reliable and rapid
trading process resulting in maximized customer service.
As part of its ongoing commitment to enhancing execution quality,
on August 1, 2000, CBOE introduced the Best Execution Assurance
Program.SM The program utilizes technological applications to provide
member firms and other customers with best execution documen-
tation. By providing direct price protection and the means with which
to evaluate the quality of order executions at CBOE, the program
provides member firms with the tools necessary to satisfy their best
execution obligations when deciding to route order flow to CBOE.
CBOE developed the first Nasdaq Volatility Index, VXN,SM as it
became apparent that there was a dramatic divergence between
volatility in the Nasdaq market and the broader market early in
1999. This significant resource, introduced on January 23, 2001,
was constructed in response to customer demand for a quantified
CBOE Nasdaq Volatility Index (VXN) and CBOE Volatility IndexSM (VIXSM)
January 1995 to January 2001
100
80
60
40
20
0
01.03.95
01.03.96
01.02.97
01.02.98
01.05.99
01.05.00
01.05.01
VXN
VIX
VXN is based on the implied volatilities of Nasdaq-100 Index® options (NDX), while VIX is based on the
implied volatilities of S&P 100® Index options (OEX®).
12 CBOE ‘01
A COMMITMENT
TO STAYING
NUMBER ONE
measure of volatility in today’s tech-heavy marketplace. VXN tracks
the volatility of Nasdaq-100 Index® options (NDX), which trade
exclusively at CBOE.
In the years ahead, CBOE will continue to face many challenges,
many anticipated and some surprises. At CBOE we view being the
industry leader as a business decision. As the marketplace evolves,
we remain committed to preserving our position as the number one
options exchange in the world through our ongoing dedication to
service a rapidly-changing marketplace.
We pledge to continue to develop the resources and products to help
both our members and their customers prosper. From the number
one options marketplace in existence, you can expect no less.
William J. Brodsky
Chairman and CEO
Mark F. Duffy
Vice Chairman
Edward J. Joyce
President and COO
13 CBOE ‘01
THE 2001 CBOE ANNUAL REPORT IS DEDICATED TO THE VICTIMS OF THE SEPTEMBER 11, 2001 TRAGEDY
“
Today we honor the victims of last week's tragic terrorist events,
including former CBOE Vice Chairman Robert Cruikshank, with
two minutes of silence prior to the ringing of the opening bell.
The whole world is watching to see how the exchanges and
financial industry respond to the events of last week. CBOE
stands ready to do its part in restoring the U.S. financial market.”
Statement from CBOE Chairman and CEO William J. Brodsky
8:28 a.m., September 17, 2001
16 CBOE ‘01
CBOE FY 2001:
THE NUMBER ONE OPTIONS
EXCHANGE FOR 28 YEARS
FINANCIAL SUMMARY
For the fiscal year ended June 30, 2001, the Chicago Board Options Exchange earned net income of $7.1 million compared
to $10.9 million in fiscal year 2000.
A new record was set for the total amount of contract volume during the year. Approximately 1,271,000 contracts per day were
traded, a 3.4% increase over the previous record established in fiscal year 2000. However, total Exchange revenues declined by
$17.5 million or 9.9% due to the elimination of equity options customer fees.
Excluding a $16.0 million consolidated class action settlement expense recorded in fiscal year 2000, operating expenses
increased by 3.8% in fiscal year 2001. This increase was attributed to higher data processing expenses mainly related to
capacity expansion ($3.1 million), non-cash depreciation and amortization expense related to investments in systems
hardware and software ($2.6 million), and royalty fees due to the highly successful launch of options on the Nasdaq-100
Index Trust ($1.0 million).
The Exchange invested $37.7 million in capital spending during fiscal year 2001. Most of these expenditures were for systems
hardware and software related to capacity increases, new trading technology, website redesign, complex orders on ORS, and a
new trading floor printer system.
During the year, $10.7 million was paid into an escrow account, representing the first two installment payments of a
consolidated class action settlement. The third payment of $5.3 million is due on July 1, 2002. Note 7 to the consolidated
financial statements summarizes the status of the settlement.
Retained earnings increased to $109.3 million and total members’ equity at June 30, 2001 was $130.2 million. At year’s end,
the Exchange was debt-free with working capital of $17.6 million.
17 CBOE ‘01
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
Chicago Board Options Exchange, Incorporated and Subsidiary
For the Years Ended June 30, 2001 and 2000
2001
2000
Revenues:
Transaction fees
Other member fees
Communications fees
Regulatory fees
Interest
Equity in income of CSE
Other
Total Revenues
Expenses:
Employee costs
Outside services
Facilities costs
Communications
Data processing
Travel and promotional expenses
Depreciation and amortization
Settlement expense
Royalty fees
Other
Total Expenses
Income Before Income Taxes
Provision (Benefit) for Income Taxes:
Current
Deferred
Total Provision (Benefit) for Income Taxes
Net Income
Retained Earnings at Beginning of Year
Retained Earnings at End of Year
$
96,091,800
24,612,500
21,538,600
10,835,500
1,347,800
716,700
2,670,800
157,813,700
67,411,600
17,451,300
3,993,000
879,600
15,263,700
6,452,100
24,634,200
0
7,396,600
2,421,000
145,903,100
11,910,600
(2,943,000)
7,717,700
4,774,700
7,135,900
102,154,500
$ 109,290,400
$ 114,460,300
23,263,000
22,580,700
8,095,400
1,890,900
415,900
4,635,100
175,341,300
69,003,700
17,351,600
3,914,300
781,000
12,118,600
6,279,900
21,985,200
16,000,000
6,430,400
2,665,500
156,530,200
18,811,100
8,401,600
(446,900)
7,954,700
10,856,400
91,298,100
$ 102,154,500
CONSOLIDATED BALANCE SHEETS
Chicago Board Options Exchange, Incorporated and Subsidiary
June 30, 2001 and 2000
2001
2000
Assets
Current Assets:
Cash and cash equivalents
Investments available-for-sale
Accounts receivable
Income taxes receivable
Prepaid medical benefits
Other prepaid expenses
Other current assets
Total Current Assets
Investments in Affiliates
Land
Property and Equipment:
Building
Furniture and equipment
Software development work in progress
Less accumulated depreciation and amortization
Total Property and Equipment—Net
Other Assets:
Goodwill (less accumulated amortization—
2001, $3,130,200; 2000, $2,373,000)
Data processing software and other assets
(less accumulated amortization—
2001, $21,762,600; 2000, $15,881,200)
Total Other Assets—Net
Total
See notes to consolidated financial statements.
18 CBOE ‘01
$
9,740,200
0
22,212,200
3,313,400
926,700
4,185,500
554,400
40,932,400
10,848,700
4,914,300
57,608,500
159,011,700
26,219,600
(139,434,000)
103,405,800
$
2,200,800
20,132,800
17,451,200
3,328,600
16,400
4,913,600
515,500
48,558,900
10,165,400
4,914,300
57,608,500
138,297,000
17,447,700
(121,472,500)
91,880,700
2,145,300
2,902,500
14,783,000
16,928,300
12,489,100
15,391,600
$ 177,029,500
$ 170,910,900
CONSOLIDATED BALANCE SHEETS (CONTINUED)
June 30, 2001 and 2000
Liabilities and Members’ Equity
Current Liabilities:
Accounts payable and accrued expenses
Settlement payable
Marketing fee payable
Membership transfer deposits
Other deposits
Total Current Liabilities
Long-term Liabilities:
Long-term settlement obligations
Deferred income taxes
Total Long-term Liabilities
Total Liabilities
Members’ Equity
Memberships
Retained earnings
Total Members’ Equity
Total
CONSOLIDATED STATEMENTS OF CASH FLOWS
Chicago Board Options Exchange, Incorporated and Subsidiary
For the Years Ended June 30, 2001 and 2000
Cash Flows from Operating Activities:
Net income
Adjustments to reconcile net income to
net cash flows from operating activities:
Depreciation and amortization
Long-term settlement obligations
Deferred income taxes
Equity in income of CSE
Changes in current assets and liabilities:
Accounts receivable
Income taxes
Prepaid medical benefits
Other prepaid expenses
Other current assets
Accounts payable and accrued expenses
Settlement payable
Marketing fee payable
Membership transfer deposits
Other deposits
Net Cash Flows from Operating Activities
Cash Flows from Investing Activities:
Capital and other assets expenditures
Investments available-for-sale:
Proceeds from maturities
Purchases
Net Cash Flows from Investing Activities
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
2001
2000
$
13,746,800
0
9,173,400
0
416,000
23,336,200
5,333,300
18,136,000
23,469,300
46,805,500
20,933,600
109,290,400
130,224,000
$
19,560,200
5,333,300
0
1,465,500
378,800
26,737,800
10,666,700
10,418,300
21,085,000
47,822,800
20,933,600
102,154,500
123,088,100
$ 177,029,500
$ 170,910,900
2001
2000
$
7,135,900
$
10,856,400
24,634,200
(5,333,400)
7,717,700
(716,700)
(4,761,000)
15,200
(910,300)
728,100
(38,900)
(5,813,400)
(5,333,300)
9,173,400
(1,465,500)
37,200
25,069,200
(37,662,600)
115,751,800
(95,619,000)
(17,529,800)
7,539,400
2,200,800
21,985,200
10,666,700
(446,900)
(415,900)
515,300
(3,468,900)
747,400
(994,900)
(88,300)
(2,545,500)
5,333,300
0
(1,195,500)
(34,900)
40,913,500
(39,803,700)
187,285,300
(196,807,700)
(49,326,100)
(8,412,600)
10,613,400
$
9,740,200
$
2,200,800
Supplemental Disclosure of Cash Flow Information
Cash paid for income taxes
$
3,400
$
11,870,500
See notes to consolidated financial statements.
19 CBOE ‘01
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Chicago Board Options Exchange, Incorporated and Subsidiary
For the Years Ended June 30, 2001 and 2000
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business – The Chicago Board Options Exchange, Incorporated (“the Exchange”) is a registered securities exchange, subject
to oversight by the Securities and Exchange Commission. The Exchange’s principal business is providing a marketplace for trading
equity and index options.
Basis of Presentation – The consolidated financial statements include the accounts and results of operations of the Exchange, and its
wholly owned subsidiary, Chicago Options Exchange Building Corporation. Inter-company balances and transactions are eliminated.
Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions that affect the amounts of assets and liabilities,
disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
Cash and Cash Equivalents – Cash and cash equivalents include highly liquid investments with maturities of three months or less
from the date of purchase.
Investments – All investments are classified as available-for-sale and are reported at cost which approximates their fair value in
accordance with Statement of Financial Accounting Standards (“SFAS”) No. 115, “Accounting for Certain Investments in Debt and
Equity Securities.”
Accounts Receivable – Accounts receivable consist primarily of transaction, marketing and other fees receivable from The Options
Clearing Corporation (“OCC”), and the Exchange’s share of distributable revenue receivable from The Options Price Reporting
Authority (“OPRA”).
Investments in Affiliates – Investments in affiliates represent investments in OCC and The Cincinnati Stock Exchange (“CSE”). The
investment in OCC (20% of its outstanding stock) is carried at cost because of the limited percentage owned. The Exchange accounts
for the investment in CSE (68% of its total certificates of proprietary membership) under the equity method due to the lack of effec-
tive control over the operating and financing activities of CSE.
Property and Equipment – Property and equipment are carried at cost. Depreciation on building, furniture and equipment is provided
on the straight-line method. Estimated useful lives are 40 years for the building and five to ten years for furniture and equipment.
Leasehold improvements are amortized over the lesser of their estimated useful lives or the remaining term of the applicable leases.
Data Processing Software – Data processing software is carried at cost and amortized over five to seven years using the straight-line
method commencing with the date the software is put in service.
Goodwill – Goodwill is amortized over seven years to 40 years for financial statement presentation and over fifteen years for income
tax purposes.
Impairment of Long-Lived Assets – Management reviews long-lived assets and the related intangible assets for impairment of value
whenever events or changes in circumstances indicate the carrying amount of such assets may not be recoverable. If the Exchange
determines it is unable to recover the carrying value of the assets, the assets will be written down using an appropriate method.
Management does not believe current events or circumstances provide evidence that suggest asset values have been impaired.
Income Taxes – Income taxes are determined using the liability method, under which deferred tax assets and liabilities are recorded
based on differences between the financial accounting and tax bases of assets and liabilities.
Other Deposits – Other deposits include amounts received from members for telephones in the Exchange facility and amounts for
Exchange sponsored conferences.
Fair Value of Financial Instruments – SFAS No. 107, “Disclosures About Fair Value of Financial Instruments,” requires disclosure of
the fair value of certain financial instruments. The carrying values of financial instruments included in assets and liabilities are
reasonable estimates of their fair value.
Adoption of New Accounting Policies – Effective for the fiscal year ended June 30, 2000, the Exchange adopted the American Institute
of Certified Public Accountants’ Statement of Position (SOP) 98-1, “Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use.” The statement requires capitalization of certain costs incurred in the development of internal-use software,
including external direct material and service costs, employee payroll and payroll-related costs. Prior to adoption of SOP 98-1, the
Exchange expensed these costs as incurred. The effect of this change in accounting principle was an increase to earnings, net of tax,
of $7,531,700 and $9,483,000 for the fiscal years ended June 30, 2001 and 2000, respectively.
In June 1998, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 133, “Accounting for Derivative Instruments and
Hedging Activities,” which requires recognition of all derivative instruments in the balance sheet as either assets or liabilities and the
measurement of those instruments at fair value. SFAS No. 133 also requires changes in the fair value of the derivative instruments
to be recorded each period in current year earnings or comprehensive income depending on the intended use of the derivatives. In
June 2000, the FASB issued SFAS No. 138, which amends the accounting and reporting standards of SFAS No. 133 for certain deriva-
tive instruments and certain hedging activities. SFAS No. 133 and SFAS No. 138 are required to be adopted by the Exchange effective
July 1, 2001. In July 2001, the Exchange adopted the provisions of SFAS No. 133. No transition adjustment was required.
Recent Accounting Pronouncement – In July 2001, the FASB issued SFAS No. 142, “Goodwill and Other Intangible Assets” which is
effective for the Exchange July 1, 2002. Under SFAS No. 142, goodwill and separately identified intangible assets with indefinite lives
will no longer be amortized but reviewed annually (or more frequently if impairment indicators arise) for impairment. Separately
identified intangible assets not deemed to have indefinite lives will continue to be amortized over their useful lives. The Exchange has
deemed the impact of adopting SFAS No. 142 to be immaterial.
20 CBOE ‘01
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. INVESTMENTS
All of the Exchange’s invested excess cash balances at June 30, 2001 had a maturity date of three months or less from the purchase
date, and as a result, are classified as cash and cash equivalents. A summary of investments by security type for those investments
with a maturity greater than three months from the purchase date is presented below:
U.S. Government obligations
Corporate debt securities
Total investments available-for-sale
$
$
2001
0
0
0
2000
13,160,100
6,972,700
20,132,800
$
$
3. INVESTMENT IN THE CINCINNATI STOCK EXCHANGE
The investment in CSE is accounted for using the equity method. Condensed financial statements of the CSE as of and for the years
ended June 30, 2001 and 2000 are as follows:
Balance Sheets
Cash and cash equivalents
Securities available-for-sale
Other current assets
Long-term securities available-for-sale
Other long-term assets
Total assets
Current liabilities
Deferred income taxes
Members’ equity
Total liabilities and members’ equity
The Exchange’s share of members’ equity
Statement of Operations
Transaction revenue
Other revenue
Total revenues
Employee costs
Other expenses
Total expenses
Net income
$
2001
434,400
2,569,600
2,623,700
10,222,800
3,166,900
19,017,400
4,276,500
557,900
14,183,000
19,017,400
$
2000
4,433,200
2,463,600
2,518,600
6,360,000
1,819,700
17,595,100
4,365,300
171,300
13,058,500
17,595,100
$
10,200,400
$
9,517,100
$
2001
4,077,800
4,925,400
9,003,200
2,954,600
4,991,400
7,946,000
1,057,200
2000
3,687,700
3,210,700
6,898,400
2,094,500
4,190,200
6,284,700
613,700
415,900
$
$
The Exchange’s equity in net income
$
716,700
4. RELATED PARTIES
The Exchange’s equity in the net assets of OCC exceeded its cost by approximately $10,039,400 and $8,856,700 at June 30, 2001 and
2000, respectively. The Exchange collected transaction and other fees of $202,419,300 and $141,903,600 for the years ended June 30,
2001 and 2000, respectively, by drawing on accounts of the Exchange’s members held at OCC. For the year ended June 30, 2001, the
amount collected includes $80,069,600 of marketing fees. (See Note 9.) The Exchange had a receivable due from OCC of $15,845,800
and $8,084,800 at June 30, 2001 and 2000, respectively.
The Exchange incurred rebillable expenses on behalf of CSE, for expenses such as employee costs, computer equipment and office
space of $2,267,100 and $2,122,800 for the years ended June 30, 2001 and 2000, respectively. The Exchange had a receivable from
CSE of $461,500 and $329,000 at June 30, 2001 and 2000, respectively.
OPRA is a committee administered jointly by the five options exchanges and is authorized by the Securities and Exchange
Commission to provide consolidated options information. This information is provided by the exchanges and is sold to outside news
services and customers. OPRA’s operating income is distributed among the exchanges based on their relative volume of total trans-
actions. Operating income distributed to the Exchange was $21,538,600 and $22,580,700 for the years ended June 30, 2001 and 2000,
respectively. The Exchange had a receivable from OPRA of $5,614,700 and $5,789,500 at June 30, 2001 and 2000, respectively.
5. LEASES
The Exchange leases certain computer hardware and office space with lease terms of two years and five years, respectively. Future
minimum lease payments under these noncancelable operating leases are as follows at June 30, 2001:
2002
2003
2004
2005
2006
Total
21 CBOE ‘01
$
1,791,500
829,200
845,100
861,400
675,100
$
5,002,300
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
6. EMPLOYEE BENEFITS
Eligible employees participate in the Chicago Board Options Exchange SMART Plan (the “SMART Plan”). The SMART Plan is a
defined contribution plan, which is qualified under Internal Revenue Code Section 401(k). The Exchange contributed $3,228,500
and $3,720,900 to the SMART Plan for the years ended June 30, 2001 and 2000, respectively.
Eligible employees participate in the Supplemental Employee Retirement Plan (the “SERP Plan”). The SERP Plan is a defined
contribution plan that is nonqualified by Internal Revenue Code regulations. The Exchange contributed $1,128,400 and $1,256,200
to the SERP Plan for the years ended June 30, 2001 and 2000, respectively.
The Exchange also has a Voluntary Employees’ Beneficiary Association (“VEBA”). The VEBA is a trust, qualifying under Internal
Revenue Code Section 501(c)(9), created to provide certain medical, dental, severance, and short-term disability benefits to employees
of the Exchange. Contributions to the trust are based on reserve levels established by Section 419(a) of the Internal Revenue Code.
During fiscal years 2001 and 2000, the Exchange contributed $1,704,700 and $967,700, respectively, to the trust.
7. COMMITMENTS
The Exchange reached a settlement in September 2000 with the Securities and Exchange Commission and the Antitrust Division of
the Department of Justice concerning their investigations into the listing of certain options and other SEC regulatory issues. As part
of these settlements, the Exchange was not fined, but did agree to expend an amount that equals or exceeds $17.0 million in each
of calendar years 2000 and 2001 on options-related surveillance, regulation and enforcement.
In September 2000, the Exchange reached an agreement in principle to settle a consolidated civil class action lawsuit filed against
the Exchange and the other U.S. options exchanges and certain market maker firms. The Exchange agreed to pay $16.0 million in
three equal installments on or before October 16, 2000, July 1, 2001, and July 1, 2002. Two payments totaling $10.7 million were
made in fiscal year 2001, and are being held in escrow pending approval of the settlement agreement by the U.S. District Court for
the Southern District of New York. Approval of the settlement agreement is currently pending appellate review of the district court’s
February 2001 order granting summary judgment in favor of the defendants.
In May 2001, the Exchange and the Chicago Mercantile Exchange, Inc. announced plans to create a joint venture to trade single-
stock futures. The Exchange has a 41.6% stake in the joint venture. The new entity will be a for-profit company, will have its own
management and board, and will be separately organized as a regulated exchange. As of September 2001, the Exchange has
committed $1.3 million in funding for the joint venture.
8. INCOME TAXES
The timing of tax deductions related to the prior year’s class action settlement ($10.7 million paid and deducted in fiscal year 2001)
and internally developed software costs ($13.0 million in fiscal year 2001) are the main reasons for the income tax returns’ net
operating loss in fiscal year 2001.
A reconciliation of the statutory federal income tax rate to the effective income tax rate, for the years ended June 30, 2001 and 2000,
is as follows:
Statutory federal income tax rate
State income tax rate,
net of federal income tax effect
Rate increase (reduction) attributed to:
Equity in income of CSE
Permanent and timing differences
Effective income tax rate
2001
35.0%
4.7
(2.2)
2.5
40.0%
At June 30, 2001 and 2000, the net deferred income tax liability approximated:
2001
Deferred tax assets
Deferred tax liabilities
Net deferred income tax liability
$
$
8,887,400
27,023,400
18,136,000
2000
35.0%
4.6
(0.8)
3.5
42.3%
2000
11,114,500
21,532,800
10,418,300
$
$
Deferred income taxes arise principally from temporary differences relating to the use of accelerated depreciation methods for income
tax purposes, funding of a VEBA trust, capitalization of software under SOP 98-1, and class action lawsuit payments and liability.
9. MARKETING FEE
On July 1, 2000 the Exchange imposed a $.40 per contract marketing fee on market makers and DPMs when executing transactions
with non-Exchange market makers. The money collected was made available to DPMs for order flow marketing, including the facili-
tation of payment for order flow. The Exchange distributed funds, as directed by the DPMs, each month. At June 30, 2001 marketing
fee balances were cash of $3,536,200 and accounts receivable of $5,637,200.
22 CBOE ‘01
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
10. LITIGATION
The Exchange has been sued by six individuals, one corporation and one limited liability company who describe themselves as retail
customers and who claim that the Exchange made false representations about the operation of various Exchange systems and
engaged in fraudulent practices in connection with plaintiffs' options transactions. The complaint also alleges that they were harmed
by a regulatory inquiry that the Exchange initiated. Plaintiffs allege that the Exchange thereby violated certain sections of the
Securities Exchange Act of 1934, the Securities Act of 1933, the antitrust laws and various Illinois statutes concerning fraudulent
practices and that the Exchange defrauded them, breached contractual obligations, defamed plaintiffs and interfered with their
contractual relations. The complaint seeks damages in the amount of $100 million, plus treble damages for the alleged antitrust
violations, attorneys' fees, costs, and interest.
The Exchange also has been sued by three individuals who describe themselves as retail customers and who claim that the manner
in which the Exchange operated its “electronic transfer system” violated certain provisions of the Securities Exchange Act of 1934 and
the antitrust laws and breached contracts that the Exchange supposedly had with plaintiffs. Plaintiffs also allege that the Exchange’s
regulatory inquiry interfered with plaintiffs’ contractual relations with their clearing firms. The complaint seeks damages in excess of
$75,000, plus treble damages in connection with the antitrust claims, pre- and post-judgment interest, costs, and attorneys’ fees.
The Exchange believes that it has meritorious defenses and intends to vigorously defend itself against these actions. However,
the Exchange cannot presently estimate the amount of loss, if any, that may result. The ultimate outcome of these cases cannot
presently be determined and no allowance for loss that may result has been made in these financial statements.
INDEPENDENT AUDITORS’ REPORT
To the Board of Directors and Members of the Chicago Board Options Exchange, Incorporated:
We have audited the accompanying consolidated balance sheets of the Chicago Board Options Exchange, Incorporated (the “Exchange”)
and subsidiary as of June 30, 2001 and 2000, and the related consolidated statements of income and retained earnings and of cash
flows for the years then ended. These consolidated financial statements are the responsibility of the Exchange’s management. Our
responsibility is to express an opinion on these financial statements based on our audits. We did not audit the financial statements of
The Cincinnati Stock Exchange (“CSE”) for the year ended June 30, 2001, the Exchange’s investment in which is accounted for by use
of the equity method. The Exchange’s equity of $10,200,400 in the CSE’s net assets at June 30, 2001 and of $716,700 in that Exchange’s
net income for the respective year then ended are included in the accompanying financial statements. The financial statements of
CSE were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts
included for CSE, is based solely on the report of such other auditors.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial state-
ments. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audits and the report of the other auditors provide a
reasonable basis for our opinion.
In our opinion, based on our audits and the report of the other auditors, such consolidated financial statements present fairly, in
all material respects, the financial position of the Exchange and its subsidiary at June 30, 2001 and 2000, and the results of their
operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United
States of America.
Deloitte & Touche LLP
August 17, 2001
(September 27, 2001 as to the second paragraph in Note 10)
23 CBOE ‘01
William J. Brodsky
Mark F. Duffy
Edward J. Joyce
Robert J. Birnbaum
Thomas A. Bond
John Favia
David Johnson
Silas Keehn
Leon T. Kendall
Daniel P. Koutris
Duane R. Kullberg
David J. Lund
James P. MacGilvray
Alan D. Marks
R. Eden Martin
Robert P. Mazzarella
Anthony D. McCormick
Roderick Palmore
Susan M. Phillips
Michael J. Post
John M. Streibich
Alvin G. Wilkinson
Mark Zurack
BOARD OF DIRECTORS
WILLIAM J. BRODSKY
Chairman of the Board and
Chief Executive Officer
MARK F. DUFFY
Vice Chairman and Chairman
of the Executive Committee
EDWARD J. JOYCE
President and Chief
Operating Officer
ROBERT J. BIRNBAUM
Former President
New York Stock Exchange
American Stock Exchange
Public Director
THOMAS A. BOND
Chief Operating Officer
LETCO
JOHN FAVIA
Market Maker
Blue Capital Group
DAVID JOHNSON
Managing Director
Morgan Stanley
SILAS KEEHN
President (Retired)
Federal Reserve Bank
of Chicago
Public Director
LEON T. KENDALL
Professor of Finance
and Real Estate
J. L. Kellogg Graduate School
of Management
Northwestern University
Public Director
DANIEL P. KOUTRIS
Managing Member
KFT, DPM, LLC
DUANE R. KULLBERG
Former Chief Executive Officer
Andersen Worldwide
Public Director
DAVID J. LUND
Managing Director
and Co-Head
Global Equity Linked Products
Merrill Lynch & Co., Inc.
JAMES P. MACGILVRAY
Executive Vice President
UBS PaineWebber
ALAN D. MARKS
Former Managing Director
Salomon Smith Barney
R. EDEN MARTIN
Partner
Sidley & Austin
Public Director
ROBERT P. MAZZARELLA
President
Fidelity Brokerage
Services, LLC
ANTHONY D. MCCORMICK
Vice President
Derivative Markets
Charles Schwab & Co., Inc.
RODERICK PALMORE
Senior Vice President
Sara Lee Corporation
Public Director
SUSAN M. PHILLIPS
Former Governor
Federal Reserve Board
Dean
School of Business
and Public Management
The George Washington
University
Public Director
MICHAEL J. POST
President
Seats Exchange, Inc.
JOHN M. STREIBICH
Designated Primary
Market Maker
Susquehanna Investment
Group
ALVIN G. WILKINSON
Market Maker
Wilkinson Management, LLC
MARK ZURACK
Managing Director
Goldman Sachs & Co.
24 CBOE ‘01
STANDING COMMITTEES OF THE BOARD
AUDIT COMMITTEE
Duane R. Kullberg, Chairman
Robert J. Birnbaum
Alvin G. Wilkinson
COMPENSATION COMMITTEE
Alan D. Marks, Chairman
William J. Brodsky
Mark F. Duffy
Duane R. Kullberg
R. Eden Martin
Alvin G. Wilkinson
EXECUTIVE COMMITTEE
Mark F. Duffy, Chairman
Robert J. Birnbaum
Thomas A. Bond
William J. Brodsky
Daniel P. Koutris
Robert P. Mazzarella
Alvin G. Wilkinson
COMMITTEES OF THE MEMBERSHIP
ALLOCATION COMMITTEE
Licia J. Leslie, Chairman
Randy N. Chandra
John J. Colletti
James D. Coughlan
Joseph A. Frehr
Stuart J. Kipness
Grant W. Lawson
John B. Niemann
Benjamin E. Parker
Mark Severin
Christopher M. Wheaton
APPEALS COMMITTEE
B. Michael Kelly, Chairman
Patrick J. McDermott,
Vice Chairman
Orlando Alfonso
Matthew Arndt
Brett T. Benson
Timothy Benton
Frank Brodlo
Andrew H. Carolan
Michael T. Considine
Greg DeFalco
Bruce D. DiDominicis
David A. Filippini
James P. Fitzgibbons
Jonathan G. Flatow
Michael D. Friedman
James Gazis
Timothy P. Gill
Thomas A. Hamilton, Jr.
Mark A. Harmon
Michael P. Held
Andrew Hodgman
Paul J. Jiganti
Richard Kevin
John A. Lalowski
Kelly Luthringshausen
Daniel R. McCarthy
Patrick J. Naughton
John T. Nemeth
John B. Niemann
Renee P. O’Bryan
Daniel M. O’Donnell
Terrence M. O’Donnell
Daniel O’Grady
Daniel J. O’Shea
Peter Osborne
Douglas W. Prskalo
Gregg A. Prskalo
Sondra C. Rabin
W. Scott Schwanke
Neal Shamis
James David Short
Antanas Siurna
Svebor Smolic
James D. Sullivan
William Ulivieri
Wayne A. Weiss
Dennis M. Wetzel
Francis Wondrasek
ELECTION COMMITTEE
Joanne Moffic-Silver, Chairman
Nancy Nielsen
RaeDell Tapia-Pancake
EQUITY FLOOR PROCEDURE
COMMITTEE
Edward T. Tilly, Chairman
Michael E. Barry
Terrance G. Boyle
Patrick J. Caffrey
Anthony J. Carone
Daniel P. Carver
James D. Coughlan
David Creagan
Mark F. Duffy
Mark A. Esposito
Joseph J. Fahrenbach
Francis P. Gleason
Van V. Hemphill
Kevin J. Hincks
Paul J. Jiganti
Stuart J. Kipnes
Benjamin M. Klein
Grant W. Lawson
David F. Miller, Jr.
Kenneth D. Mueller
John E. Smollen, Jr.
J. Todd Weingart
EXEMPTION COMMITTEE
Pete Najarian, Chairman
Patrick J. Caffrey
Jeffrey A. Cesarone
Corey L. Fisher
Charles R. Heppner
Charles F. Imburgia
Matthew M. Van Aken
FACILITIES COMMITTEE
William J. Ellington, Chairman
Christopher Wheaton,
Vice Chairman
Lawrence Baier, Jr.
Edward Barry
William E. Billings
Thomas C. Bruno
Steven F. Callahan
Eric A. Conlon
David Dobeff
Mark R. Fluger
Richard W. Fuller
Dann C. Hansen
Steven Hessing
Patty Kevin-Schuler
Joe M. O’Donnell
James Wieties
David R. Zalesky
Daniel C. Zandi
FINANCIAL PLANNING
COMMITTEE
Alvin G. Wilkinson, Chairman
Robert J. Kirkland,
Vice Chairman
ARBITRATION COMMITTEE
Daniel A. Baldwin, Co-Chairman
Gregg M. Rzepczynski,
Lawrence J. Parkhill
Joseph F. Sacchetti
Timothy M. Sommerfield
BUSINESS DEVELOPMENT
COMMITTEE
Gary P. Lahey, Chairman
Richard A. Angell
Christine Bookmyer
Stephen Dillinger
Sam L. Eadie, Jr.
J. David Fikejs
Norman Friedman
Richard Haave
Monte Henige
Ross Kaminsky
Jack Kennedy
John Patrick Mulroy
Jon Najarian
Tim O’Donnell
John Robinson
Michael Rodnick
Kirk Roggensack
Christopher Sandel
Edmund J. Zarek
CBOE/CBOT JOINT
ADVISORY COMMITTEE
John E. Callahan, Chairman
David Johnson
Gary P. Lahey
Ex-Officio
Daniel N. Ambrosino
Dennis M. Davitt
Norman Friedman
Brian A. Novak
James V. Proesel
Paul L. Richards
Robert C. Sheehan
William J. Terman
CLEARING PROCEDURE
COMMITTEE
Patrick Blackburn, Chairman
Daniel Amar
Mark A. Baumgardner
John R. Beres
Mitchell R. Bialek
Louis G. Buttny
Anne Byerwalter
William F. Carik
David T. DeArmey
Patricia Firman
Art Goldberg
John Hiatt, Sr.
John J. Kaminsky
Matthew Liszka
Anthony Monaco
Ralph Mueller
John E. O’Donnell
Maureen Pacocha
Ronald L. Petzke
Frank Pirih
Michael Ryan
Susan Shimmin
Thomas C. Smith
Michael Trees
Co-Chairman
Jennifer Abrams Fisher
Thomas R. Beehler
Robert I. Chukerman
Richard M. Coplan
Charles B. Cox, III
Michael D. Coyle
Christopher P. Cribari
David Dobreff
Stephen P. Donahue
Douglas H. Edelman
Brian H. Egert
David A. Eglit
James P. Fitzgibbons
Jonathan G. Flatow
Theodoric Flemister
Mark R. Fluger
Ann Grady
Peter C. Guth
Thomas A. Hamilton
Michael P. Held
William G. Hohenadel
Paul J. Jiganti
Mark E. Kalas
Joseph G. Kinahan
John A. Koltes
John A. Lalowski
Michael Lyons
Patrick J. McDermott
Brock R. McNerney
Nina V. Milovac
Joseph D. Mueller
Scott O’Connell
Charles W. Palm
Donald F. Pratl
Steven M. Quirk
Sondra C. Rabin
Peter V. Rogus
Scott E. Schram
William Shimanek
Richard R. Taylor
Fred Teichert
John H. Waterfield
Patrick W. Wehr
Dennis M. Wetzel
James U. Wieties
Corey D. Zimmerman
BUSINESS CONDUCT
COMMITTEE
John F. Burnside, Chairman
David T. DeArmey,
Vice Chairman
Orlando J. Alfonso
J. Peter Brown
Raymond P. Dempsey
Robert C. Errico
Richard I. Fremgen
Maureen C. Guilfoile
Allen B. Holeman
Judith M. Kula
Gary P. Lahey
Steven A. O’Malley
25 CBOE ‘01
COMMITTEES OF THE MEMBERSHIP (CONTINUED)
Bruce I. Andrews
Stephen P. Donahue
Boris Furman
Fred O. Goldman
William J. Gorman
Eric Henschel
Michael B. Hoban
Jeffrey T. Kaufmann
Kevin J. Keller
Michael R. Quaid
Howard N. Ring
Frank A. Roszkiewicz
Joseph Sellitto
Robert Silverstein
FINANCIAL REGULATORY
COMMITTEE
David T. DeArmey, Chairman
Richard E. Schell,
Vice Chairman
Margaret E. Wiermanski,
Vice Chairman
Matthew Abraham
Mark A. Babbich
Patrick Blackburn
William F. Carik
Frank Catris
Mark Gannon
Fred O. Goldman
William Gould
John Hiatt, Sr.
Kristen Hughes Kelly
Judith M. Kula
Bruce Marcinek
Steven O’Malley
Janice Rohr
Ex-Officio
Linda Haven
Andrew Naughton
Jacqueline Sloan
FLOOR DIRECTORS
COMMITTEE
Mark F. Duffy, Chairman
Thomas A. Bond
John Favia
David Johnson
Daniel P. Koutris
Michael Post
John M. Streibich
Alvin G. Wilkinson
FLOOR OFFICIALS
COMMITTEE
Raymond P. Dempsey, Chairman
Robert A. Fodor, Vice Chairman
Daniel C. Zandi, Vice Chairman
Janice R. Armstrong
Daniel A. Baldwin
Thomas A. Brady
James G. Brophy
Patrick J. Caffrey
James K. Corsey
Brian M. Dowd
Damon M. Fawcett
Craig R. Johnson
Donald H. Klein, Jr.
Daniel P. McCollar
Thomas W. McEntegart
Kurt R. Passehl
John E. Smollen, Jr.
Charles D. Woodward
INDEX FLOOR PROCEDURE
COMMITTEE
Jeffrey S. Latham, Chairman
Jonathan G. Flatow,
Vice Chairman
Peter Brown
Terrence J. Brown
Richard Cichy
Michael F. Gallagher
Edward M. Giangiorgi
Sean Haggerty
John Justic
Emanual Liontakes
Michael McGuire
Alec Milam
Robert C. O’Mullan
Steven J. Pettinato
Douglas W. Prskalo
Keith Siemiawski
Paul Stefanos
Scott Tinervia
Richard E. Tobin
Charles D. Woodward
INDEX MARKET
PERFORMANCE COMMITTEE
Jonathan G. Flatow, Chairman
Andrew W. Hall, Vice Chairman
Donald C. Cullen
Jerry E. Diegel
Charles E. Feuillan
Mark A. Harmon
Peter J. Heinz, Jr.
Thomas H. Jarck
Jeffrey L. Klein
Todd A. Koster
Walter J. Krop
Michael F. Lohman
James W. Lynch
John P. Mariner
Daniel F. McHugh
Brian M. Morgan
Christopher Nevins
Brian A. Novak
Daniel J. O’Shea
John A. Possidoni
Steven M. Quirk
Peter H. Schulte
Thomas J. Siurek
Elan A. Strominger
J. Todd Weingart
LESSOR ADVISORY
COMMITTEE
Michael J. Post, Chairman
Anthony P. Arciero
Arnold S. Arfa
Lawrence J. Blum
Allan H. Carney
Mario D’Agostino
Stephen Dillinger
Patrick J. English
Norman S. Friedland
Michael P. Held
John R. Hosty
Paul J. Jiganti
Ruth I. Kahn
Jerold Kopf
Victor R. Meskin
Michael M. Mondrus
Robert M. Murphy
T. Paul Natenberg
Loren H. Newman
Martin P. O’Connell
26 CBOE ‘01
William R. Power
Berton Rubin
Robert Silverstein
Leslie R. Zuckerman
MARKET PERFORMANCE
COMMITTEE
John M. Streibich, Chairman
Mark Severin, Vice Chairman
Terrence J. Andrews
Susan C. Bannon
Michael R. Benson
Richard H. Bode
Terrence E. Burke
Terrence E. Cullen
Richard W. Fuller, Jr.
James E. Keaty
Donald H. Klein, Jr.
Brian R. Korbel
Licia J. Leslie
James J. Mead, Jr.
John B. Niemann
John P. O’Grady
Burt J. Robinson
Frank P. Tenerelli
John H. Waterfield, III
Thomas Weston
MEMBER FIRM
OPERATIONS COMMITTEE
Gerald T. McNulty, Chairman
Thomas Berk, III
Michael K. Brennan
James G. Brophy
Jeffrey J. Bughman
Daniel Keith Busse
Daniel P. Carver
Steven M. Chilow
Raymond P. Dempsey
Robert B. Duddy
William Ellington
Joseph A. Frehr
Francis P. Gleason
Lawrence J. Hanson
David Johnson
Jeffrey S. Kantor
Jeffrey T. Kaufmann
Stuart Kipnes
Donald H. Klein
Jeffrey S. Latham
James C. Lavery
Gerald T. McNulty
David F. Miller
Mark T. Morse
Mark Oakley
Jonathan O’Donnell
Michael Stowick
Michael Trees
J. Todd Weingart
MEMBERSHIP COMMITTEE
Robert B. Gianone, Chairman
Richard W. Fuller,
Vice Chairman
Anthony P. Arciero
Craig R. Barone
Kenneth J. Bellavia
Gary L. Bowers
Thomas E. Callahan
Keir S. Collins
David A. Eglit
Robert R. Fabijanowicz
Matthew J. Filpovich
Sean W. Haggerty
David C. Ho
James J. Humes
Robert B. Hutchison
Michael T. Kalchbrenner
William M. Kennedy
Madeline Kiedysz
Lloyd William Montgomery
Dora Morano-Koop
Andrew B. Newmark
Philip Gregory Oakley
Donald F. Pratl
Michael L. Rodnick
Mary Rita Ryder
Gregg Rzepczynski
Stuart Saltzberg
Robert J. Wasserman
Patrick W. Wehr
Leslie Zuckerman
MODIFIED TRADING SYSTEM
(MTS) APPOINTMENTS
COMMITTEE
William J. O’Keefe, Chairman
Cabot B. Caldwell
Daniel P. Carver, Sr.
Randy N. Chandra
Mark F. Duffy
Joseph A. Frehr
Brandon S. Koress
Gerald T. McNulty
John E. Smollen, Jr.
John M. Streibich
Christopher M. Wheaton
NOMINATING COMMITTEE
Ilene M. Resnick Garber,
Chairman
Steven M. Chilow
Lawrence J. Hanson
William C. McGowan
Victor R. Meskin
Donald F. Phillips
Howard N. Ring
William J. Terman
Richard L. Thomas
Arnold R. Weber
PRODUCT DEVELOPMENT
COMMITTEE
Thomas A. Bartlett, Chairman
Alan Burstein
Angelo Calvello
Boris Furman
Gary P. Lahey
Brian A. Novak
Martin P. O’Connell
Dominic Salvino
Robert C. Sheehan
SCREEN-BASED TRADING
COMMITTEE
John Favia, Chairman
Barton Bergman
James J. Boyle
Terrance G. Boyle
Jim Harkness
Paul J. Jiganti
Ross G. Kaminsky
John A. Koltes
Jeffrey Latham
Steve Malitz
Gerald T. McNulty
Brian A. Novak
Thomas M. O’Donnell
Joseph Sellitto
Phillip Teuscher
COMMITTEES OF THE MEMBERSHIP (CONTINUED)
SPECIAL PRODUCT
ASSIGNMENT COMMITTEE
Licia J. Leslie, Chairman
Thomas A. Bartlett
James D. Coughlan
Mark F. Duffy
Jonathan Flatow
John Streibich
Christopher M. Wheaton
Replacement Members
John Colletti
Boris Furman
Burt Robinson
Thomas Siurek
SPX FLOOR PROCEDURE
COMMITTEE
Richard T. Marneris, Chairman
Jeffrey Kupets, Vice Chairman
Salvatore J. Aiello
Mark Caffray
TASK FORCES
GOVERNANCE TASK FORCE
Duane R. Kullberg, Chairman
Robert J. Birnbaum
Thomas A. Bond
Alan D. Marks
Michael J. Post
Alvin G. Wilkinson
MARKET LINKAGE
TASK FORCE
James J. Boyle
Mark F. Duffy
Ross G. Kaminsky
ADVISORY COMMITTEES
COMPLIANCE
ADVISORY PANEL
Kevin Ahearn
David DeMuro
Robert C. Errico
George Janos
James Kehoe
Mark Manning
Michelle Morgan
Robert Palleschi
Brian Underwood
Paul Wigdor
DISCOUNT ADVISORY
COMMITTEE
Angelo Benedetto
Connie Dotson
Bruce MacAlpine
Gary Martino
Barry Mione
Christopher Nagy
Frank O'Connor
Carrie Rattle
Maurisa Sommerfeld
John Caffrey
Eoin Callery
Joseph Carsello
S. Mark Cavanagh
Michael Cozzie
Timothy Feeney
Kevin Flaherty
Ron K. Grutzmacher
Michael Hayes
Thomas H. Jarck
John Massarelli
Michael Mayor
Daniel Quinn
David A. Scatena
Michael Schueneman, Jr.
John Tracy
Timothy Weinand
Allan Welby
Alvin G. Wilkinson
STOCK SELECTION
COMMITTEE
Benjamin Parker, Chairman
David Adent, Vice Chairman
Robert E. Ariss
L. Wade Brewer
Daniel J. Callahan
John Colletti
Mark G. Eddy
Michael Frazin
John S. Henkel
B. Michael Kelly
Brock R. McNerney
Thomas E. Palka
R. James Relihan
Todd J. Schwartz
Svebor Smolic
John Superson
Timothy J. Werner
Thomas G. Weston
J. Slade Winchester
SYSTEMS COMMITTEE
Daniel P. Koutris, Chairman
Marc Brown
Anthony J. Carone
Daniel Condon
Thomas Corbett
Stephen Dillinger
Michael Friedman
John Haffner
James Harkness
John J. Kaminsky
Mark J. Karrasch
Robert Kirkland
Bruce Meegan
David Miller
John E. O’Donnell
Patrick Quinn
Jeffrey K. Wagner
Craig Karsen
Scott Kilrea
Gary P. Lahey
Jeff Melgard
David F. Miller
Edward T. Tilly
STOCK FUTURES
TASK FORCE
William J. Brodsky, Chairman
Mark F. Duffy, Vice Chairman
Thomas A. Bartlett
Robert J. Birnbaum
John Favia
David Johnson
Edward J. Joyce
Peter Lee
Kevin Luthringshausen
Anthony D. McCormick
Susan M. Phillips
Michael J. Post
John Stafford
Alvin G. Wilkinson
Mark Zurack
STRATEGIC PLANNING
TASK FORCE
William J. Brodsky, Chairman
Thomas A. Bond
Mark F. Duffy
John Favia
Edward J. Joyce
R. Eden Martin
Anthony D. McCormick
Michael J. Post
Stephen Mitchell
Denny Moorman
Ann Mueller
Henry Nothnagel
Nancy Penwell
Wendy Rea
John Sagness
William Sanford
James Schmitz
Terri Strickland-Smith
Carol Zenk
RETAIL ADVISORY
COMMITTEE
Matthew Gelber
John Harris
Laura Holder
Edward Lynn
Anthony Miliote
Gregory Miller
Kevin Murphy
Michael Perry
Philip Polera
William Ryan
Christopher Sandel
Michael Schwartz
Thomas Stotts
Stewart Winner
MANAGING DIRECTORS
COMMITTEE
John Andersen
Joseph Bile
Joseph Dattolo
Lawrence Hanson
David Johnson
Ronald Kessler
Peter Lee
James MacGilvray, Jr.
Douglas Matthews
Anthony McCormick
Kurt Muller
Leslie Quick, III
Thomas Sheridan
Simon Terner
Joseph Valenza
NEW YORK FIRM
ADVISORY COMMITTEE
Maureen Demane
Joseph Fenton
Robert Fogliano
Scott Fullman
Lenny Greenbaum
Michael Rouse
Lawrence Starr
INSTITUTIONAL
TRADERS GROUP
Alan Augarten
John Brett
Arnaud Desombre
Jerry Donini
Ralph Edwards
Joseph Gahtan
Kenneth MacKenzie
Arthur Mbanefo
Larry Motola
Mark Neuberger
Van Nguyen
Brett Overacker
Ralph Reynolds
Daniel Waldron
REGIONAL FIRM
ADVISORY COMMITTEE
Vince Bonato
Louis DePaul
Dino Galeazzi
Dalton Givens
Mary Hanan
Sharon Jensen
James Knight
Jon Matthai
27 CBOE ‘01
EXECUTIVE OFFICERS AND STAFF OFFICIALS
EXECUTIVE
WILLIAM J. BRODSKY
Chairman and Chief
Executive Officer
CIVIC AND GOVERNMENTAL
AFFAIRS
AMY ZISOOK
Vice President
MARK F. DUFFY
Vice Chairman and Chairman
of the Executive Committee
EDWARD J. JOYCE
President and Chief
Operating Officer
BUSINESS DEVELOPMENT
EDWARD L. PROVOST
Executive Vice President
THOMAS A. BRADY
Vice President
Member Trading Services
TULLY R. DAVIA
Vice President
Institutional Marketing
PATRICK J. FAY
Vice President
Business Development
DANIEL R. HUSTAD
Vice President
Market Quality and Assurance
WILLIAM G. KSANDER
Vice President
Statistical Analysis
MATTHEW T. MORAN
Vice President
Institutional Marketing
DEBRA L. PETERS
Vice President
The Options Institute
WILLIAM J. WHITE, JR.
Vice President
Member Trading Services
CORPORATE
COMMUNICATIONS
CAROL E. KENNEDY
Vice President
CORPORATE PLANNING
AND RESEARCH
RICHARD G. DUFOUR
Executive Vice President
JOSEPH LEVIN
Vice President
Research and Product
Development
FINANCE AND
ADMINISTRATION
ALAN J. DEAN
Senior Vice President and
Chief Financial Officer
DONALD R. PATTON
Controller and Vice President
Accounting
JAMES P. ROCHE
Vice President
Market Data Services
DEBORAH WOODS
Vice President
Human Resources
LEGAL
JOANNE MOFFIC-SILVER
General Counsel and
Corporate Secretary
ARTHUR B. REINSTEIN
Deputy General Counsel
J. PATRICK SEXTON
Assistant General Counsel
REGULATORY SERVICES
MARY L. BENDER
Senior Vice President
DOUGLAS BECK
Vice President
Market Monitoring
LAWRENCE J. BRESNAHAN
Vice President
Financial and Sales
Practice Compliance
RICHARD LEWANDOWSKI
Vice President
Regulatory Services
MARGARET WILLIAMS
Vice President
Market Regulation
SYSTEMS
GERALD T. O’CONNELL
Executive Vice President and
Chief Information Officer
GORDON D. EVORA
Vice President
Systems Development
JAMES J. NECEDA
Vice President
Systems Development
MARK S. NOVAK
Vice President
Systems Development
LARRY L. PFAFFENBACH
Vice President
Systems Planning
ROBERTA J. PIWNICKI
Vice President
Systems Development
GAUTAM ROY
Vice President
Software
CURT SCHUMACHER
Vice President
Systems Operations
TRADING OPERATIONS
PHILIP M. SLOCUM
Senior Vice President
GAIL FLAGLER
Vice President
Reporting Services
JOHN T. JOHNSTON
Vice President
Execution and Reporting
Services
THOMAS P. KNORRING
Vice President
Trade Processing
ANTHONY MONTESANO
Vice President
Trading Operations
MICHAEL TODOROFSKY
Vice President
Market Operations
TIMOTHY T. WATKINS
Vice President
Trading Systems Development
CLEARING MEMBER FIRMS
A A Sage Corporation
A.G. Edwards & Sons, Inc.
ABN AMRO, Inc.
ABN AMRO Sage Corporation
Advest, Inc.
Banc One Brokerage
International Co.
Bank of America
Securities, LLC
Bear Stearns Securities Corp.
BNP Securities (U.S.A.), Inc.
BNY Clearing Services, LLC
Carr Futures, Inc.
Carr Futures Inc./Direct Wire
Charles Schwab & Co., Inc.
Charles Schwab Canada Co.
CIBC Oppenheimer Corp.
Credit Suisse First Boston
Corporation
Dain Rauscher, Inc.
Dean Witter Reynolds, Inc.
Deutsche Bank
Alex Brown, Inc.
Donaldson Lufkin & Jenrette
Securities Corporation/
Pershing Division
E-Trade Securities, Inc.
E.D. & F. Man
International, Inc.
E.D. & F. Man International,
Inc./Retail Customer
Ernst & Co. (Corporation)
ESI Securities Company
Fahnestock & Co., Inc.
FIMAT, USA, Inc.
First Options of Chicago, Inc.
Goldman, Sachs & Co.
Herzog, Heine, Geduld, Inc.
Hull Trading Company, LLC
INC Trading Corp.
ING Securities Derivatives/
Customer Division
ING TT&S (U.S.)
Securities, Inc.
ING (U.S.) Securities,
Futures & Options, Inc.
Interactive Brokers, LLC
J.J.B. Hilliard, W.L. Lyons, Inc.
J.P. Morgan Securities, Inc.
K.A., Division of First Options
of Chicago, Inc.
Knight Execution Partners, LLC
K.V. Execution Services, LLC
Ladenburg, Thalman & Co., Inc.
Lakeshore Securities, L.P.
Lehman Brothers, Inc.
LIT America, Inc./CRI Division
LIT, Division of First Options
of Chicago, Inc.
Maple Partners U.S.A, Inc.
Merrill Lynch, Pierce,
Fenner & Smith, Inc.
Merrill Lynch Professional
Clearing
Mesirow Financial, Inc.
Morgan Keegan
& Company, Inc.
Morgan Stanley
& Company, Inc.
National Financial
Services, LLC
National Bank Financial, Inc.
N.K. & Co., Inc./Ernst & Co.
Nomura Securities
International, Inc.
O’Connor & Company, LLC
PaineWebber, Inc.
PAX Clearing Corporation
PAX Clearing Corp.–AB
Preferred Capital
Markets, Inc.
Prudential Securities, Inc.
Raymond James &
Associates, Inc.
RBC Dominion Securities
Corporation
Refco Securities, LLC
Robb, Peck, McCooey
Clearing Corporation
Robert W. Baird & Co., Inc.
Salomon Brothers, Inc.
Salomon Smith Barney, Inc.
Schroder & Co., Inc.
SG Cowen Securities
Corporation
Spear, Leeds & Kellogg
Stephens, Inc.
Stifel, Nicolaus
& Company, Inc.
Timber Hill, LLC
TradeLink, LLC
Tucker Anthony, Inc.
UBS Warburg, LLC
U.S. Clearing Corp.
Warburg Dillon Read, LLC
Weiss, Peck & Greer, LLC
Ziv Investment Company
28 CBOE ‘01
SECURITIES UNDERLYING OPTIONS
360networks inc.
3Com Corporation
4Kids Entertainment, Inc.
724 Solutions Inc.
Abbott Laboratories
Abercrombie & Fitch Company
Abgenix, Inc.
ABIOMED, Inc.
Abitibi-Consolidated Inc.
Accredo Health, Incorporated
ACT Manufacturing, Inc.
Acterna Corporation
Action Performance
Companies, Inc.
Active Power, Inc.
Activision, Inc.
Acxiom Corporation
Adaptec, Inc.
ADC Telecommunications, Inc.
Adelphia Business
Solutions, Inc.
Adelphia Communications
Corporation Class A
Adept Technology, Inc.
Administaff, Inc.
Adobe Systems Incorporated
Advanced Digital
Information Corp.
Advanced Energy Industries, Inc.
Advanced Fibre
Communications, Inc.
Advanced Micro Devices, Inc.
Aeroflex Incorporated
AES Corporation
Aether Systems, Inc.
Aetna Inc.
Affiliated Computer Services,
Inc. Class A
Affymetrix, Inc.
AFLAC Incorporated
A.G. Edwards & Sons, Inc.
Agere Systems Inc.
Agile Software Corporation
Agilent Technologies, Inc.
Agnico-Eagle Mines Ltd.
Agrium, Inc.
Airborne, Inc.
AirTran Holdings, Inc.
AK Steel Holding Corporation
Akamai Technologies, Inc.
Albany Molecular Research, Inc.
Albertson’s, Inc.
Alcan Inc.
Alcatel
Alcoa Inc.
Alexion Pharmaceuticals, Inc.
Align Technology, Inc.
Alkermes, Inc.
Allegheny Energy, Inc.
Allegiance Telecom, Inc.
Allergan, Inc.
Alliance Capital
Management, L.P.
Alliance Semiconductor
Corporation
Alliant Techsystems, Inc.
Allied Waste Industries, Inc.
Alloy Online, Inc.
Allstate Corporation (The)
ALLTEL Corporation
Alpha Industries, Inc.
Altera Corporation
Alvarion Ltd.
Amazon.com, Inc.
Amdocs Ltd.
Amerada Hess Corporation
America Movil S.A. de C.V.
American Capital
Strategies, Ltd.
American Eagle Outfitters, Inc.
American Electric Power
Company, Inc.
American Express Company
American General Corporation
American Home Products
Corporation
American International
Group, Inc.
American Management
Systems, Inc.
American Power Conversion
Corporation
American Standard
Companies Inc.
American Tower Corporation
Class A
AmeriCredit Corporation
AmeriSource Health
Corporation
Ameritrade Holding
Corporation Class A
Ames Department Stores, Inc.
Amgen, Inc.
Amkor Technology, Inc.
Amphenol Corporation Class A
AMR Corporation
AmSouth Bancorporation
Amylin Pharmaceuticals, Inc.
Anadarko Petroleum
Corporation
Anadigics, Inc.
Analog Devices, Inc.
Anaren Microwave, Inc.
Anchor Gaming
Andrew Corporation
Andrx Corporation
AngloGold Limited
Anheuser-Busch
Companies, Inc.
Ann Taylor Stores Corporation
Answerthink, Inc.
ANTEC Corporation
AOL Time Warner, Inc.
Aon Corporation
Apache Corporation
Apogent Technologies Inc.
Apollo Group, Inc.
Apple Computer, Inc.
Applebee’s International, Inc.
Applera Corporation-Applied
Biosystems Group
Applera Corporation-Celera
Genomics Group
Applied Materials, Inc.
Applied Micro Circuits
Corporation
Applied Power, Inc.
Apria Healthcare Group
Incorporated
Aquila, Inc.
Arbitron Inc.
Arch Coal, Inc.
Archer Daniels Midland
Company
AremisSoft Corporation
Arena Pharmaceuticals, Inc.
Argosy Gaming Company
ARIAD Pharmaceuticals, Inc.
Ariba Inc.
Arrow Electronics, Inc.
Art Technology Group, Inc.
Artesyn Technologies, Inc.
29 CBOE ‘01
Arthur J. Gallagher & Co.
ArvinMeritor, Inc.
ASA Limited
Ascential Software Corporation
ASE Test Limited
AsiaInfo Holdings, Inc.
ASM International N.V.
ASM Lithography Holding N.V.
Aspect Communications
Corporation
Associated Banc-Corp
Astoria Financial Corporation
AstraZeneca PLC ADS
Asyst Technologies, Inc.
At Home Corporation Class A
Atlas Air, Inc.
Atmel Corporation
AT&T Canada, Inc. Class B
AT&T Corporation
AT&T Wireless
AudioCodes Ltd.
Aurora Biosciences Corporation
Auspex Systems, Inc.
Automatic Data Processing, Inc.
AutoNation, Inc.
Autozone, Inc.
Avanex Corporation
Avaya Inc.
Aventis S.A.
Avici Systems, Inc.
Avigen, Inc.
Aviron
Avista Corporation
Avnet, Inc.
Avocent Corporation
Avon Products, Inc.
AVX Corporation
Aware, Inc.
AXA Financial, Inc.
Axcelis Technologies, Inc.
Aztar Corporation
Baker Hughes Incorporated
Ballard Power Systems, Inc.
Bank of America Corporation
Bank of New York Company,
Inc. (The)
Bank One Corporation
Banknorth Group, Inc.
Barnes & Noble, Inc.
Barr Laboratories, Inc.
Barrett Resources Corporation
Barrick Gold Corporation
Bausch & Lomb Incorporated
Baxter International, Inc.
BB&T Corporation
BCE, Inc.
BEA Systems, Inc.
Bear Stearns Companies,
Inc. (The)
Becton, Dickinson & Company
Bed Bath & Beyond, Inc.
BellSouth Corporation
Belo Corporation
Bergen Brunswig Corporation
Class A
Best Buy Co., Inc.
Beverly Enterprises, Inc.
BindView Development
Corporation
Biogen, Inc.
Biomet, Inc.
Biomira Inc.
Biopure Corporation
Biosite, Inc.
Bio-Technology General
Corporation
Biotime Inc.
Biovail Corporation
BJ Services Company
BJ’s Wholesale Club, Inc.
Black Box Corporation
Black & Decker
Corporation (The)
Blue Martini Software, Inc.
BMC Software, Inc.
Boeing Company (The)
Boise Cascade Corporation
Bookham Technology
PLC-SPON ADR
Borders Group, Inc.
Borland Software Corporation
Boston Communications
Group, Inc.
Boston Scientific Corporation
BP PLC
Brightpoint, Inc.
Brio Technology, Inc.
Bristol-Myers Squibb Company
BriteSmile, Inc.
British Telecommunications PLC
Broadcom Corporation
BroadVision, Inc.
Broadwing Inc.
Brocade Communications
Systems, Inc.
Brunswick Corporation
BSQUARE Corporation
Buca, Inc.
Burlington Northern
Santa Fe Corporation
Burlington Resources Inc.
Business Objects S.A. ADR
Cable & Wireless PLC ADR
Cablevision Systems
Corporation
Cabot Microelectronics
Corporation
CacheFlow Inc.
Cadence Design Systems, Inc.
Caliper Technologies Corp.
Callaway Golf Company
Calpine Corporation
Caminus Corporation
Campbell Soup Company
Canadian National Railway
Company
Capital One Financial
Corporation
Capstone Turbine Corporation
Cardinal Health, Inc.
Caremark Rx, Inc.
CarMax Group
Carnival Corporation
Carreker Corporation
Carrier Access Corporation
Carter-Wallace, Inc.
Caterpillar, Inc.
C&D Technologies, Inc.
CDW Computer Centers, Inc.
Celestica Inc.
Celgene Corporation
Cell Genesys, Inc.
Cell Pathways, Inc.
Cell Therapeutics, Inc.
Cendant Corporation
Centex Corporation
Centillium Communications, Inc.
Centra Software, Inc.
Central Garden & Pet Company
CenturyTel, Inc.
Cephalon, Inc.
Ceridian Corporation
SECURITIES UNDERLYING OPTIONS (CONTINUED)
Cerner Corporation
Charles Schwab
Corporation (The)
Charter Communications, Inc.
Chartered Semiconductor
Manufacturing Ltd.
Cheap Tickets, Inc.
Check Point Software
Technologies Ltd.
Checkfree Corporation
Chesapeake Energy
Corporation
Chevron Corporation
Chico’s FAS, Inc.
China Mobile (Hong Kong)
Limited
China Unicom Limited
ChipPAC, Inc.
Chiron Corporation
Christopher & Banks
Corporation
Chubb Corporation (The)
Ciena Corporation
CIGNA Corporation
Cinergy Corporation
Cintas Corporation
Circuit City Stores, Inc.
Cirrus Logic, Inc.
Cisco Systems, Inc.
Citigroup, Inc.
Citizens Communications
Company
Citrix Systems, Inc.
City National Corporation
Claire’s Stores, Inc.
Clarent Corporation
Clarus Corporation
Clear Channel
Communications, Inc.
Clorox Company (The)
CMGI, Inc.
CMS Energy Corporation
CNET Networks, Inc.
CNF Inc.
Coach, Inc.
Coca-Cola Company (The)
Coca-Cola Enterprises Inc.
Cognos Incorporated
Coinstar, Inc.
Colgate-Palmolive Company
COLT Telecom Group PLC ADR
Columbia Laboratories, Inc.
Columbia Sportwear Company
Com21, Inc.
Comcast Corporation
(Special Class A)
Comdisco, Inc.
Comerica Incorporated
Commerce One, Inc.
Community Health Systems, Inc.
Companhia de Bebidas das
Americas (AmBev)–PR ADR
Compania Anonima Nacional
Telefonos de Venezuela
Compania de
Telecomunicaciones de
Chile S.A. ADR
Compaq Computer Corporation
CompuCredit Corporation
Computer Associates
International, Inc.
Computer Horizons Corporation
Computer Sciences Corporation
Computer Network
Technology Corporation
Compuware Corporation
Comstock Resources, Inc.
Comverse Technology, Inc.
ConAgra Foods, Inc.
Concord Camera Corp.
Concord Communications, Inc.
Concord EFS, Inc.
Concurrent Computer
Corporation
Conexant Systems, Inc.
Conoco Inc. Class A
Conoco Inc. Class B
Conseco, Inc.
Consul Energy, Inc.
Consolidated Edison, Inc.
Continental Airlines, Inc.
Convera Corporation
Convergys Corporation
Cooper Cameron Corporation
Cooper Industries, Inc.
Copper Mountain Networks, Inc.
COR Therapeutics, Inc.
Corinthian Colleges, Inc.
Corixa Corporation
Corning Incorporated
Corvis Corporation
Costco Wholesale Corporation
Countrywide Credit
Industries, Inc.
Covance Inc.
Covansys Corporation
Covanta Energy Corporation
Corvas International, Inc.
Cox Communications, Inc.
Class A
Creative Technology Limited
Credence Systems Corporation
Cree, Inc.
Crompton Corporation
Crown Castle International
Corporation
CryptoLogic Inc.
CSFBdirect, Inc.
CSG Systems International, Inc.
Cubist Pharmaceuticals, Inc.
Cummins Inc.
CuraGen Corporation
Curis, Inc.
CV Therapeutics, Inc.
CVS Corporation
Cyber-Care, Inc.
Cyberonics, Inc.
Cygnus, Inc.
Cymer Inc.
Cypress Semiconductor
Corporation
CYTOGEN Corporation
Cytyc Corporation
DaimlerChrysler AG
Dana Corporation
Danaher Corporation
Darden Restaurants, Inc.
DDi Corporation
Deere & Company
Dell Computer Corporation
Delphi Automotive Systems
Delta Air Lines, Inc.
Delta & Pine Land Company
Dentsply International, Inc.
Descartes Systems Group Inc.
Deutsche Telekom AG ADR
Devon Energy Corporation
Diamond Offshore Drilling, Inc.
DiamondCluster
International, Inc.
Digex, Incorporated
Digital Island, Inc.
30 CBOE ‘01
Digital Lightwave, Inc.
Digital River, Inc.
Dime Bancorp, Inc.
Direct Focus, Inc.
Ditech Communications
Corporation
Diversa Corporation
DMC Stratex Networks, Inc.
Dollar General Corporation
Dollar Tree Stores, Inc.
Doral Financial Corporation
DoubleClick, Inc.
Dow Chemical Company (The)
DQE, Inc.
DSP Group, Inc.
Duke Energy Corporation
Duramed Pharmaceuticals, Inc.
Dycom Industries, Inc.
Dynegy Inc.
E*Trade Group Inc.
E.piphany, Inc.
EarthLink, Inc.
Eastman Chemical Company
Eastman Kodak Company
Eaton Corporation
eBay, Inc.
Echelon Corporation
EchoStar Communications
Corporation
ECI Telecom Ltd.
Eclipsys Corp.
EDEN Bioscience Corporation
Edison International
Edison Schools, Inc.
Edwards Lifesciences
Corporation
E.I. du Pont de Nemours
& Company
El Paso Corporation
Elan Corporation PLC ADR
Electric Fuel Corporation
Electro Scientific Industries, Inc.
Electroglas, Inc.
Electronic Arts, Inc.
Electronic Data Systems
Corporation
Electronics for Imaging, Inc.
Eli Lilly and Company
eLoyalty Corporation
Embarcadero Technologies, Inc.
Embratel Participacoes S.A.
EMC Corporation
EMCORE Corporation
Emerson Electric Company
Emisphere Technologies, Inc.
Emulex Corporation
Energizer Holdings, Inc.
Energy East Corporation
Engelhard Corporation
Enron Corp.
ENSCO International
Incorporated
Entegris, Inc.
Enterasys Networks, Inc.
Entercom Communications Corp.
Entergy Corporation
Entravision Communications
Corporation
EntreMed, Inc.
Entrust, Inc.
Enzo Biochem, Inc.
Enzon, Inc.
EOG Resources, Inc.
Epicore Software Corporation
EPIQ Systems, Inc.
Equant N.V.
Ericsson (L.M.) Telephone
Co. ADR
ESC Medical Systems, Limited
ESS Technology, Inc.
Estee Lauder Companies, Inc.
(The) Class A
Exar Corporation
Excel Technology, Inc.
Exelixis, Inc.
Exelon Corporation
EXFO Electro-Optical
Engineering, Inc.
Exodus Communications, Inc.
Expedia, Inc.
Expeditors International
of Washington, Inc.
Express Scripts, Inc. Class A
Extended Stay America, Inc.
Extreme Networks, Inc.
Exult, Inc.
Exxon Mobil Corporation
F5 Networks, Inc.
Factory 2-U Stores, Inc.
Fairchild Semiconductor
International
Fannie Mae
Fastenal Company
Federated Department
Stores, Inc.
FedEx Corporation
Fidelity National Financial, Inc.
Fifth Third Bancorp
FileNet Corporation
Finisar Corporation
First Data Corporation
First Health Group Corporation
First Union Corporation
FirstEnergy Corp.
Fiserv, Inc.
FLAG Telecom Holdings
Limited
FleetBoston Financial
Corporation
Fleming Companies, Inc.
Flextronics International Ltd.
Flowers Foods, Inc.
Fluor Corporation
FMC Corporation
FMC Technologies, Inc.
Focal Communications
Corporation
Ford Motor Company
Forest Laboratories, Inc.
Forest Oil Corporation
Forward Air Corporation
Foster Wheeler Ltd.
Foundry Networks, Inc.
Fox Entertainment Group, Inc.
Freddie Mac
FreeMarkets, Inc.
Freeport-McMoRan Copper
& Gold, Inc. Class B
Frontier Airlines, Inc.
FSI International, Inc.
FuelCell Energy, Inc.
Fundtech Ltd.
Furniture Brands
International, Inc.
Gadzooks, Inc.
Gadzoox Networks, Inc.
Galileo International, Inc.
Gap, Inc. (The)
Garmin Ltd.
Gateway, Inc.
Gemstar-TV Guide
International, Inc.
SECURITIES UNDERLYING OPTIONS (CONTINUED)
Genaissance
Pharmaceuticals, Inc.
Gene Logic Inc.
Genentech, Inc.
General Cable Corporation
General Dynamics Corporation
General Electric Company
General Mills, Inc.
General Motors Corporation
General Motors Corporation
Herman Miller, Inc.
Hershey Foods Corporation
Hewlett-Packard Company
Hi/fn, inc.
Hibernia Corporation Class A
Hilton Hotels Corporation
Hispanic Broadcasting Corp.
Hitachi Ltd. ADR
Hollinger International, Inc.
Hollis-Eden
(Hughes Electronics) Class H
Pharmaceuticals, Inc.
Genesis Microchip, Inc.
Genome Therapeutics Corp.
Genta Incorporated
Genuity, Inc.
Genzyme Corporation
Genzyme Corporation–
Genzyme Biosurgery Division
Georgia-Pacific Group
Geron Corporation
Getty Images, Inc.
Gilat Satellite Networks, Ltd.
Gilead Sciences, Inc.
Gillette Company (The)
Glenayre Technologies, Inc.
Global Crossing Ltd.
Global Industries Ltd.
Global Marine, Inc.
Globalstar
Telecommunications Ltd.
GlobeSpan, Inc.
Globix Corporation
Globo Cabo S.A. SP ADR
GoAmerica, Inc.
Golden State Bancorp, Inc.
Goldman Sachs Group,
Inc. (The)
Goodrich Corporation
Goodyear Tire & Rubber
Company (The)
GoTo.com, Inc.
Grant Prideco, Inc.
Great Lakes Chemical
Corporation
Greater Bay Bancorp
GreenPoint Financial Corp.
Grupo Financiero Galicia S.A.
Grupo Televisa S.A. ADR
GTECH Holdings Corporation
Gucci Group, N.V.
Guidant Corporation
Guilford Pharmaceuticals, Inc.
Gymboree Corporation (The)
H Power Corp.
Hain Celestial Group, Inc.
Halliburton Company
Handspring, Inc.
Hanover Compressor
Holding Corp.
Harley-Davidson, Inc.
Harmonic, Inc.
Harrah’s Entertainment, Inc.
Harris Corporation
Hartford Financial Services
Group, Inc. (The)
HCA, Inc.
Headwaters, Incorporated
Health Management
Associates, Inc. Class A
Health Net, Inc.
HEALTHSOUTH Corporation
Heidrick & Struggles
International, Inc.
Heinz (H.J.) Company
Helmerich & Payne, Inc.
Hercules Incorporated
Home Depot, Inc. (The)
Homestake Mining Co.
Homestore.com, Inc.
Honeywell International Inc.
Horizon Offshore, Inc.
Hospitality Properties Trust
Hot Topic, Inc.
Hotel Reservations Network,
Inc. Class A
HotJobs.com, Ltd.
Household International, Inc.
H&R Block, Inc.
HSBC Holdings PLC
Hudson United Bancorp
Human Genome Sciences, Inc.
Humana, Inc.
Huntington Bancshares, Inc.
Hutchinson Technology, Inc.
Hyperion Solutions Corporation
Hyseq, Inc.
i2 Technologies, Inc.
Ibis Technology Corp.
IBP, Inc.
ICN Pharmaceuticals, Inc.
ICOS Corporation
IDEC Pharmaceuticals
Corporation
Identix Incorporated
IDT Corporation
Ikon Office Solutions, Inc.
ILEX Oncology, Inc.
Illinois Tool Works, Inc.
I-many, Inc.
IMC Global, Inc.
ImClone Systems Incorporated
Immune Response
Corporation (The)
Immunex Corporation
ImmunoGen, Inc.
Immunomedics, Inc.
IMPATH, Inc.
IMPCO Technologies, Inc.
Imperial Chemical Industries
PLC ADR
IMRglobal Corporation
IMS Health Incorporated
INAMED Corporation
Incyte Genomics, Inc.
Inet Technologies, Inc.
InFocus Corporation
InfoSpace.com, Inc.
ING Groep N.V. ADR
Ingersoll-Rand Company
Ingram Micro, Inc.
Inhale Therapeutic Systems
Inktomi Corporation
Input/Output, Inc.
Inrange Technologies
Corporation Class B
Insight Communications
Company, Inc.
Instinet Group, Incorporated
Integra LifeSciences Holdings
Corporation
Integrated Circuit Systems, Inc.
31 CBOE ‘01
Integrated Device
Technology, Inc.
Integrated Silicon Solutions, Inc.
Intel Corporation
InteliData Technologies
Corporation
Interactive Data Corporation
InterDigital Communications
Corporation
Interliant Inc.
International Business
Machines Corporation
International FiberCom, Inc.
International Flavors &
Fragrances, Inc.
International Game Technology
International Paper Company
International Rectifier
Corporation
Internet Architecture HOLDRs
Trust (IAH)
Internet Capital Group, Inc.
Internet Security Systems, Inc.
Interpublic Group of
Companies, Inc. (The)
Intersil Holding Corporation
Interstate Bakeries Corporation
InterVoice-Brite, Inc.
Interwoven, Inc.
Intimate Brands, Inc. Class A
IntraNet Solutions, Inc.
Intuit Corporation
Intuitive Surgical, Inc.
Investment Technology
Group, Inc.
Investors Financial
Services Corp.
Invitrogen Corporation
IONA Technologies
Isis Pharmaceuticals, Inc.
i-STAT Corporation
ITT Educational Services, Inc.
ITT Industries, Inc.
Ivax Corporation
Ixia
IXYS Corporation
J Net Enterprises, Inc.
Jabil Circuit, Inc.
Jack Henry & Associates Inc.
Jazztel PLC ADR
J.C. Penney Company, Inc.
J.D. Edwards & Company
JDS Uniphase Corporation
JLG Industries, Inc.
JNI Corp.
John Hancock Financial
Services, Inc.
Johnson & Johnson
Jones Apparel Group, Inc.
J.P. Morgan Chase & Co.
Juniper Networks, Inc.
Jupiter Media Metrix, Inc.
Kansas City Southern
Industries, Inc.
KB HOME
Keithley Instruments, Inc.
Kellogg Company
KEMET Corporation
Kerr-McGee Corporation
Key Energy Services, Inc.
KeyCorp
Keynote Systems, Inc.
Keyspan Corp.
Kimberly-Clark Corporation
Kinder Morgan, Inc.
King Pharmaceuticals, Inc.
KLA-Tencor Corporation
Kmart Corporation
Knight/Trimark Group, Inc.
Kohl’s Corporation
Koninklijke Philips
Electronics N.V.
Kopin Corporation
KPMG Consulting Inc.
KPNQuest N.V.
Kraft Foods Inc.
Krispy Kreme Doughnuts, Inc.
Kroger Company (The)
K-Swiss, Inc.
Kulicke and Soffa
Industries, Inc.
L3 Communications
Holdings, Inc.
Laboratory Corporation of
America Holdings
LaBranche & Co Inc.
Lam Research Corporation
Lamar Advertising Company
Landry’s Seafood
Restaurants, Inc.
Lands’ End Inc.
Large Scale Biology Corp.
Lattice Semiconductor
Leap Wireless International, Inc.
Legato Systems, Inc.
Legg Mason, Inc.
Lehman Brothers Holdings, Inc.
Lennar Corporation, Inc.
Lernout & Hauspie
Speech Products
Level 3 Communications
Lexicon Genetics Incorporated
Lexmark International
Group, Inc. Class A
Liberate Technologies, Inc.
Liberty Media Corporation
Series A
LifePoint Hospitals, Inc.
LightPath Technologies, Inc.
Class A
Limited, Inc. (The)
Lincare Holdings, Inc.
Lincoln National Corporation
Linear Technology Corporation
Liz Claiborne, Inc.
Lockheed Martin Corporation
Loews Corporation
Longs Drug Stores Corporation
Loral Space &
Communications Ltd.
Louis Dreyfus Natural Gas Corp.
Lowe’s Companies, Inc.
LSI Logic Corporation
LTX Corporation
Lucent Technologies, Inc.
Luminent, Inc.
Lyondell Chemical Company
MacroChem Corporation
MacroMedia, Inc.
Macrovision Corporation
Madge Networks N.V.
Magna International, Inc.
Class A
Mandalay Resort Group
Manor Care, Inc.
Manpower, Inc.
Manufacturers Services Limited
Manugistics Group, Inc.
MapInfo Corporation
Marconi PLC ADR
Marine Drilling Companies, Inc.
Marriott International, Inc.
SECURITIES UNDERLYING OPTIONS (CONTINUED)
Marsh & McLennan
Companies, Inc.
Marvell Technology Group Ltd.
Massey Energy Company
MatrixOne, Inc.
Mattel, Inc.
Maxim Integrated Products, Inc.
Maxim Pharmaceuticals, Inc.
Maxtor Corporation
May Department Stores
Company (The)
Maytag Corporation
MBNA Corporation
McAfee.com Corporation
McDATA Corporation Class A
McDATA Corporation Class B
McDermott International, Inc.
McDonald’s Corporation
McKesson Corporation
McLeodUSA, Inc.
MDU Resources Group, Inc.
Mead Corporation (The)
Medarex, Inc.
Mediacom Communications
Corporation
Medicines Company (The)
Medicis Pharmaceutical
Corporation
MedImmune, Inc.
Medtronic, Inc.
Mellon Financial Corporation
Mentor Graphics Corporation
Merck & Co., Inc.
Mercury Interactive Corporation
Merix Corporation
Merrill Lynch & Co., Inc.
Metalink Ltd.
MetaSolv, Inc.
Methode Electronics, Inc.
Class A
MetLife, Inc.
Metricom, Inc.
Metris Companies, Inc.
Metromedia Fiber Network, Inc.
MGI Pharma Inc.
MGM Mirage
Micrel, Inc.
Microchip Technology, Inc.
Micromuse, Inc.
Micron Technology, Inc.
Microsemi Corp.
Microsoft Corporation
MicroStrategy Incorporated
Microtune, Inc.
Midway Games, Inc.
Millennium Pharmaceuticals,
Inc.
Millipore Corporation
MiniMed Inc.
Minnesota Mining &
Manufacturing Company
MIPS Technologies, Inc. Class B
Mirant Corporation
Mitchell Energy & Development
Motorola, Inc.
MP3.com, Inc.
Mpower Holding Corp.
MRV Communications Inc.
MSC Industrial Direct Co., Inc.
M-Systems Flash Disk
Pioneer Ltd.
MTR Gaming Group, Inc.
Murphy Oil Corporation
Mykrolis Corporation
Mylan Laboratories, Inc.
Myriad Genetics Inc.
Nabors Industries, Inc.
Nasdaq–100 Index Tracking
StockSM
National City Corporation
National Commerce
Financial Corp.
National Oilwell, Inc.
National Semiconductor
Corporation
Nautica Enterprises, Inc.
Navistar International
Corporation
NBTY, Inc.
NCR Corp.
NeoRx Corporation
Net.B@nk, Inc.
Net2Phone, Inc.
Netegrity, Inc.
NetIQ Corporation
Netopia, Inc.
Netro Corporation
Network Appliance, Inc.
Network Associates, Inc.
Network Peripherals, Inc.
Network Plus Corp.
New Focus, Inc.
New York Community
Bancorp, Inc.
Newell Rubbermaid
Corporation
Newmont Mining Corporation
Newport Corporation
Newport News Shipbuilding Inc.
News Corporation Ltd.
(The) ADR
Nu Horizons Electronics Corp.
Nuance Communications Inc.
Nucor Corporation
Numerical Technologies, Inc.
NVIDIA Corporation
Oak Technology, Inc.
Oakley, Inc.
Occidental Petroleum
Corporation
Ocean Energy Inc.
Office Depot, Inc.
Oil Service HOLDRs Trust
Omnicom Group, Inc.
OmniSky Corporation
ONI Systems Corporation
Onyx Pharmaceuticals, Inc.
ONYX Software Corporation
Open Text Corporation
Open TV Corp.
Openwave Systems, Inc.
Oplink Communications, Inc.
Optical Communication
Products, Inc.
Optimal Robotics Corp.
Oracle Corporation
OraSure Technologies, Inc.
Orbital Sciences Corporation
Orchid BioSciences
Organogenesis, Inc.
Orthodontic Centers
of America, Inc.
OSI Pharmaceuticals, Inc.
Outback Steakhouse, Inc.
Owens-Illinois, Inc.
Oxford Health Plans, Inc.
PACCAR, Inc.
Pacific Sunwear of
California, Inc.
PacifiCare Health Systems,
Inc. Class B
Packaging Corp of America
Pall Corporation
Palm, Inc.
PanAmSat Corporation
Papa John’s International, Inc.
Parametric Technology
Corporation
Next Level Communications,
Park Place Entertainment
Inc.
NextCard, Inc.
Nextel Communications,
Inc. Class A
Nice Systems Ltd. ADR
NIKE, Inc. Class B
NiSource Inc.
Noble Affiliates, Inc.
Noble Drilling Corporation
Nokia Corporation ADR
Norfolk Southern Corporation
Nortel Networks Corporation
Northeast Utilities
Northern Trust Corporation
Northfield Laboratories, Inc.
Northrop Grumman
Corporation
Parker Drilling Company
Patterson Dental Company
Patterson-UTI Energy, Inc.
Paxson Communications
Corporation
Paychex, Inc.
Payless ShoeSource, Inc.
PC Connection, Inc.
Peabody Energy Corporation
PEC Solutions, Inc.
Pediatrix Medical Group, Inc.
Pegasus Communications
Corporation
Pegasus Solutions, Inc.
Pemstar, Inc.
Pennzoil-Quaker State
Company
PeopleSoft Inc.
Pep Boys-Manny, Moe,
& Jack (The)
Pepsi Bottling Group, Inc.
PepsiAmericas, Inc.
PepsiCo, Inc.
Peregrine Systems, Inc.
Pericom Semiconductor
Corporation
PerkinElmer, Inc.
Perot Systems Corporation
Perrigo Company
PetroChina Company
Limited ADR
Petroleo Brasileiro
S.A. PETROBRAS-ADR
Petroleum Geo-Services
ASA ADR
Pfizer Inc.
PG&E Corporation
Pharmaceutical HOLDRs Trust
Pharmaceutical Resources, Inc.
Pharmacia Corporation
Phelps Dodge Corporation
Philip Morris Companies Inc.
Philippine Long Distance
Telephone Company ADR
Phillips Petroleum Company
Pier 1 Imports, Inc.
Pinnacle Systems, Inc.
Pivotal Corporation
Pixelworks, Inc.
Placer Dome Inc.
Plexus Corporation
Plug Power Inc.
Plum Creek Timber Co. Inc.
PLX Technology, Inc.
PMC-Sierra, Inc.
PNC Financial Services
Group Inc.
Pogo Producing Company
Pohang Iron & Steel
Company, Ltd. ADR
Polaroid Corporation
Polo Ralph Lauren Corp.
Polycom, Inc.
PolyMedica Corporation
Portal Software, Inc.
Potash Corporation of
Saskatchewan Inc.
Potlatch Corporation
Power-One, Inc.
Powerwave Technologies, Inc.
PPG Industries, Inc.
PRAECIS Pharmaceuticals, Inc.
Pre-Paid Legal Services, Inc.
Presstek, Inc.
PRI Automation Inc.
Price Communications
Corporation
Priceline.com Incorporated
Pride International, Inc.
Primedia Inc.
Procter & Gamble
Company (The)
Prodigy Communications
Corporation
Professional Detailing, Inc.
Progenics Pharmaceuticals, Inc.
Progressive Corporation (The)
Protective Life Corporation
Protein Design Labs, Inc.
Proton Energy Systems, Inc.
Provident Financial Group, Inc.
Providian Financial
Corporation
Proxim, Inc.
PTEK Holdings, Inc.
Public Service Company
of New Mexico
Pulte Homes, Inc.
Pumatech, Inc.
PurchasePro.com, Inc.
QLogic Corporation
QLT Inc.
Quaker Oats Company
Corp. Class A
Corporation
Mitsubishi Tokyo Financial
Northwest Airlines Corp.
Group, Inc. ADR
MKS Instruments, Inc.
Modis Professional Services Inc.
Mohawk Industries, Inc.
Molecular Devices Corporation
Molex Incorporated
Monsanto Company
Montana Power Company
Morgan Stanley Dean Witter
& Co.
Class A
NOVA Corporation (Georgia)
Novartis AG-ADR
Novatel Wireless, Inc.
Novell, Inc.
Novellus Systems, Inc.
Novoste Corporation
NPS Pharmaceuticals, Inc.
NRG Energy, Inc.
NTL Incorporated
32 CBOE ‘01
SECURITIES UNDERLYING OPTIONS (CONTINUED)
QUALCOMM, Inc.
Quanta Services, Inc.
Quantum Corporation–DLT &
Storage Systems Group
Quest Diagnostics Incorporated
Quest Software, Inc.
Questar Corporation
Quintiles Transnational
Corporation
QWest Communications
International
Radian Group
RadioShack Corporation
RADVision Ltd.
Rainbow Media Group
Ralston Purina Group
Rambus, Inc.
Rational Software Corporation
Reader’s Digest Association,
Inc. Class A
Read-Rite Corporation
RealNetworks Inc.
Red Hat, Inc.
Redback Networks Inc.
Reebok International Ltd.
Regeneration Technologies, Inc.
Regional Bank HOLDRs Trust
Register.com, Inc.
Reliant Energy, Inc.
Reliant Resources, Inc.
Remedy Corporation
Remington Oil & Gas
Corporation
Republic Services Inc. Class A
Research in Motion Limited
Resources Connection, Inc.
Respironics, Inc.
Retail HOLDRs Trust
Retek Inc.
Revlon, Inc. Class A
RF Micro Devices, Inc.
Rite Aid Corporation
Riverstone Networks, Inc.
R.J. Reynolds Tobacco
Holdings, Inc.
Rockwell Collins, Inc.
Rockwell International
Corporation
Rostelecom ADR
Rowan Companies, Inc.
Roxio, Inc.
Royal Bank of Canada
Royal Caribbean Cruises Ltd.
Royal Dutch Petroleum
Company
RPM, Inc.
RSA Security Inc.
Ruby Tuesday, Inc.
Rudolph Technologies, Inc.
Ryder Systems, Inc.
S1 Corporation
Saba Software, Inc.
Sabre Holdings Corp.
SAFECO Corporation
Safeguard Scientifics, Inc.
Safeway, Inc.
Salix Pharmaceuticals, Ltd.
Sanchez Computer Associates
SanDisk Corporation
Sanmina Corporation
Santa Fe International,
Corporation
SAP AG
Sapient Corporation
Sara Lee Corporation
SatCon Technology Corporation
Satyam Infoway Limited ADR
Sawtek Inc.
SBA Communications
Corporation
SBC Communications, Inc.
SBS Technologies, Inc.
SCG Holding Corporation
Schein (Henry), Inc.
Schering-Plough Corporation
Schlumberger Limited
SCI Systems, Inc.
SciClone Pharmaceuticals, Inc.
Scientific-Atlanta, Inc.
Scios, Inc.
SeaChange International, Inc.
Sealed Air Corporation
Sears, Roebuck and Company
SeeBeyond Technology
Corporation
SEI Investments Company
Seitel, Inc.
Select Medical Corporation
Semiconductor HOLDRs Trust
Semtech Corporation
Sepracor, Inc.
Sequenom Inc.
SERENA Software, Inc.
Serono SA-ADR
Shaw Group, Inc. (The)
Shell Transport & Trading
Company, PLC ADR
Sherwin-Williams
Company (The)
Shire Pharmaceuticals
Group PLC ADR
SICOR, Inc.
Siebel Systems, Inc.
Sierra Pacific Resources
Sigma-Aldrich Corporation
Silicon Image, Inc.
Silicon Laboratories Inc.
Silicon Storage Technology, Inc.
Silicon Valley Bancshares
SilverStream Software, Inc.
Sirius Satellite Radio, Inc.
SK Telecom Co., Ltd. ADS
SmartForce PLC
Smith International, Inc.
Smurfit Stone Container
Corporation
Software HOLDRs Trust
Solectron Corporation
Solutia Inc.
Sonic Automotive, Inc.
SONICblue Incorporated
SonicWALL, Inc.
Sonus Networks, Inc.
Sorrento Networks Corporation
Southern Company (The)
SouthTrust Corporation
Southwest Airlines Co.
Southwest Securities Group, Inc.
Sovereign Bancorp, Inc.
Spectrasite Holdings, Inc.
Spectrian Corporation
SpeechWorks International, Inc.
SpeedFam-IPEC, Inc.
Spiegel, Incorporated Class A
Sprint Corporation–Sprint
FON Group
Sprint Corporation–Sprint
PCS Group
SPX Corporation
St. Jude Medical, Inc.
St. Mary Land & Exploration
Company
33 CBOE ‘01
St. Paul Companies, Inc. (The)
Stanford Microdevices, Inc.
Staples, Inc.
Starbucks Corporation
STARR Surgical Company
Starwood Hotels & Resorts
Trust
State Street Corporation
Station Casinos, Inc.
Stericycle, Inc.
STERIS Corporation
Stewart & Stevensen
Services, Inc.
Stillwater Mining Company
Stilwell Financial, Inc.
STMicroelectronics N.V.
Storage Technology
Corporation
StorageNetworks, Inc.
Stratos Lightwave, Inc.
Stryker Corporation
Suiza Foods Corp.
Sun Life Financial Services
of Canada, Inc.
Sun Microsystems, Inc.
SunGard Data Systems Inc.
Sunoco, Inc.
Sunrise Assisted Living, Inc.
SunTrust Banks, Inc.
Superconductor Technologies,
Inc.
SuperGen, Inc.
Superior Energy Services, Inc.
Swift Energy Company
Swift Transportation Co., Inc.
Sybase, Inc.
Sycamore Networks, Inc.
Symantec Corporation
Symbol Technologies, Inc.
Syncor International
Corporation
Syngenta AG-ADR
Synopsys, Inc.
Synovos Financial Corp.
Sysco Corporation
T. Rowe Price Associates
Taiwan Semiconductor
Manufacturing Company Ltd.
Take-Two Interactive
Software, Inc.
Tanox, Inc.
Target Corporation
Targeted Genetics Corporation
Taro Pharmaceutical
Industries Ltd.
TCF Financial Corporation
TD Waterhouse Group, Inc.
Technitrol, Inc.
Teekay Shipping Corporation
Tekelec
Tektronix Inc.
Telebras HOLDRs
Telecom Argentina Stet-France
Telecom S.A. ADR
Telecom HOLDRs Trust
TeleCorp PCS, Inc.
Teledyne Technologies
Incorporated
Telefonica de Argentina,
S.A. ADR
Telefonica S.A. ADR
Telefonos de Mexico,
S.A. de C.V. ADR
TeleNorte Leste Participacoes
S.A. ADS
TeleTech Holdings, Inc.
Tellabs, Inc.
Tellium, Inc.
Tenet Healthcare Corporation
Teradyne, Inc.
Terayon Communication
Systems, Inc.
Terra Networks, S.A.
Teva Pharmaceutical
Industries Ltd. ADR
Texaco, Inc.
Texas Instruments
Incorporated
Theragenics Corporation
Therma-Wave, Inc.
Thermo Electron Corporation
THQ Inc.
Three-Five Systems, Inc.
TIBCO Software Inc.
Ticketmaster
Tidel Technologies, Inc.
Tidewater, Inc.
Tiffany & Co.
Time Warner Telecom Inc.
Timken Company (The)
Titan Corporation (The)
TiVo Inc.
TJX Companies, Inc. (The)
TMP Worldwide, Inc.
Toll Brothers, Inc.
Tollgrade Communications, Inc.
Tommy Hilfiger Corporation
Tootsie Roll Industries, Inc.
Topps Company, Inc. (The)
Tosco Corporation
Total Fina S.A. ADR
Toyota Motor Corporation ADR
Toys “R” Us, Inc.
Transkaryotic Therapies, Inc.
Transmeta Corporation
Transocean Sedco Forex Inc.
TranSwitch Corporation
Travelocity.com, Inc.
Tribune Company
Trico Marine Services, Inc.
Tricon Global Restaurants
Trigon Healthcare, Inc.
Trimble Navigation Limited
Trimeris, Inc.
Tripath Technology, Inc.
Triquint Semiconductor, Inc.
Triton Energy Ltd.
Trizec Hahn Corporation
TriZetto Group, Inc.
TRW Inc.
Tubos de Acero de Mexico
S.A. ADR
Turnstone Systems, Inc.
TV Azteca S.A. de C.V.
Tweeter Home Entertainment
Group, Inc.
Tyco International Ltd.
TyCom, Ltd.
Tyson Foods, Inc. Class A
UAL Corporation
UAXS Global Holdings, Inc.
UBS AG
UICI
Ulticom, Inc.
Ultramar Diamond
Shamrock Corp.
Ultratech Stepper, Inc.
Union Pacific Corporation
Unisys Corporation
United Microelectronics
Corporation ADR
United Natural Foods, Inc.
SECURITIES UNDERLYING OPTIONS (CONTINUED)
United Parcel Service, Inc.
Class B
United Stationers, Inc.
United Technologies
Corporation
United Therapeutics
Corporation
UnitedGlobalCom, Inc.
UnitedHealth Group
Universal Access
Universal Health Services, Inc.
Class B
University of Phoenix Online
Univision Communications,
Inc. Class A
Unocal Corporation
UnumProvident Corporation
USA Education, Inc.
US Airways Group, Inc.
U.S. Bancorp
USEC, Inc.
USFreightways Corporation
USG Corporation
Usinternetworking, Inc.
US Oncology, Inc.
UST Inc.
USX-Marathon Group
USX-U.S. Steel Group
Utilities HOLDRs Trust
UTStarcom, Inc.
VA Linux Systems, Inc.
Valence Technology, Inc.
Valero Energy Corporation
ValueVision International, Inc.
Varian, Inc.
Varian Semiconductor
Equipment Associates, Inc.
Vastera, Inc.
Veeco Instruments, Inc.
Ventana Medical Systems, Inc.
Ventiv Health, Inc.
VeriSign, Inc.
Veritas DGC, Inc.
VERITAS Software Corporation
Verity, Inc.
Verizon Communications, Inc.
Versata, Inc.
Vertex Pharmaceuticals
Incorporated
VerticalNet, Inc.
V.F. Corporation
Viacom, Inc. Class A
Viacom, Inc. Class B
ViaSat Inc.
Viasystems Group, Inc.
Vicor Corporation
Vignette Corporation
Vimpel-Communications ADR
Vintage Petroleum, Inc.
Virata Corporation
ViroPharma Incorporated
Vishay Intertechnology, Inc.
Visteon Corporation
VISX, Incorporated
Vitesse Semiconductor
Corporation
Vitria Technology, Inc.
Vivendi Universal
Vodafone Group Plc ADR
Wabash National Corporation
Wachovia Corporation
Walgreen Co.
Wal-Mart Stores, Inc.
Walt Disney Company (The)
Washington Mutual, Inc.
Waste Connections, Inc.
Waste Management, Inc.
WatchGuard Technologies, Inc.
Waters Corporation
Watson Pharmaceuticals, Inc.
Wave Systems Corporation
Weatherford International, Inc.
WebMD Corporation
webMethods, Inc.
Websense Inc.
WellPoint Health Networks, Inc.
Wells Fargo & Company
Wendy's International, Inc.
Western Digital Corporation
Western Multiplex Corporation
Weyerhaeuser Company
Whirlpool Corporation
Whole Foods Market, Inc.
Wild Oats Markets, Inc.
Willamette Industries, Inc.
Williams Communications
Group, Inc.
Williams Companies, Inc. (The)
Williams-Sonoma, Inc.
Wind River Systems, Inc.
Winn-Dixie Stores, Inc.
Winnebago Industries, Inc.
Winstar Communications, Inc.
Wisconsin Central
Transportation Corporation
WJ Communications, Inc.
WorldCom, Inc.–MCI Group
WorldCom, Inc.–WorldCom
Group
W.R. Berkley Corporation
Xcelera, Inc.
Xerox Corporation
Xilinx, Inc.
XM Satellite Radio Holdings, Inc.
XO Communications, Inc.
XOMA Ltd.
XTO Energy Inc.
Xybernaut Corporation
Yahoo! Inc.
York International Corporation
Zale Corporation
Zebra Technologies Corporation
Zimmer Holdings, Inc.
Zions Bancorporation
ZixIt Corporation
Zoltek Companies, Inc.
Zoran Corporation
STOCK INDICES
DOMESTIC BROAD-BASED
CBOE Mini-NDX (MNXSM)
Dow Jones Industrial
AverageSM (DJX)
Goldman Sachs Technology
Index (GSTITM) Composite
(GTC)
iSharesSM S&P 100® Index
Fund (OEF)
Morgan Stanley Multinational
Company IndexSM (NFT)
Nasdaq-100® (NDX)
Nasdaq-100® Index Tracking
StockSM (QQQ)
NYSE Composite® (NYA)
S&P 100® Index (OEX®)
(American-style exercise)
34 CBOE ‘01
S&P 100® Index (XEOSM)
(European-style exercise)
S&P 500® (SPX)
S&P 500/BARRA Growth (SGX)
S&P 500/BARRA Value (SVX)
S&P SmallCap 600® (SML)
Russell 2000® (RUT)
Salomon Smith Barney
Holdings Inc.
Dow Jones Industrial
AverageSM Index Equity
Linked Notes expiring
September 6, 2005
Salomon Smith Barney
Holdings Inc.
Nikkei 225 Index Securities
expiring August 20, 2002
Salomon Smith Barney
Holdings Inc.
S&P 500® Index Equity
Linked Notes expiring
March 11, 2002
Salomon Smith Barney
Holdings Inc.
S&P 500® Index Equity
Linked Notes expiring
October 3, 2003
Salomon Smith Barney
Holdings Inc.
2000 TEN+SM Index
Call Warrants expiring
September 26, 2005
Salomon Smith Barney
Holdings Inc.
Targets Trust III Targeted
Growth Enhanced Terms
Securities ("TARGETS®")
with respect to the
common stock of MCI
WorldCom, Inc. expiring
August 15, 2002
Salomon Smith Barney
Holdings Inc.
Callable S&P 500® Index
Equity Linked Notes
expiring June 30, 2006
Salomon Smith Barney
Holdings Inc.
S&P 500® Index Equity
Linked Notes expiring
December 30, 2005
Salomon Smith Barney
Holdings Inc.
Targets Trust IV Targeted
Growth Enhanced Terms
Securities ("TARGETS®")
with respect to the common
stock of Amgen, Inc. expiring
November 15, 2002
Salomon Smith Barney
Holdings Inc.
Targets Trust V Targeted
Growth Enhanced Terms
Securities ("TARGETS®")
with respect to the common
stock of Sun Microsystems,
Inc. expiring May 15, 2003
OTHER EQUITY PRODUCTS
TRADED
iSharesSM S&P 100® (OEF)
Nasdaq-100® Index Tracking
StockSM (QQQ)
DOMESTIC SECTORS
CBOE Gold (GOX)
CBOE Internet (INX)
CBOE Oil (OIX)
CBOE Technology (TXX)
Dow 10SM Index (MUT)
Dow Jones Equity REIT
IndexSM (DJR)
Dow Jones Internet
Commerce IndexSM (ECM)
Dow Jones Transportation
AverageSM (DTX)
Dow Jones Utility
AverageSM (DUX)
GSTITM Hardware (GHA)
GSTITM Internet (GIN)
GSTITM Multimedia
Networking (GIP)
GSTITM Semiconductor (GSM)
GSTITM Services (GSV)
GSTITM Software (GSO)
S&P Banks (BIX)
S&P Chemicals (CEX)
S&P Health Care (HCX)
S&P Insurance (IUX)
S&P Retail (RLX)
S&P Transportation (TRX)
INTERNATIONAL
CBOE Mexico (MEX)
INTEREST RATES
Each contract is based on
the “spot yield” (the annualized
discount rate for T-bills and
the yield-to-maturity for
T-notes and T-bonds) of the
most recently auctioned
corresponding U.S. Treasuries:
5-year T-note (FVX)
10-year T-note (TNX)
13-week T-bill (IRX)
30-year T-bond (TYX)
STRUCTURED PRODUCTS
American Express Credit
Corporation
1 1/8% Cash Exchangeable
Notes expiring
February 19, 2003
The Bear Stearns
Companies Inc.
S&P 500® Index Equity
Linked Notes expiring
May 20, 2003
The Goldman Sachs Group, Inc.
Callable Index Linked
Notes due November 23,
2003 (linked to the GSTITM
Internet Index)
The Goldman Sachs Group, Inc.
Callable Index Linked
Notes due December 2,
2003 (linked to the GSTITM
Internet Index)
“Dow Jones,SM” “Dow Jones
Industrial Average,SM” “Dow
Jones Transportation
Average,SM” “Dow Jones Utility
Average,SM” “DJA,SM” “Options
on The Dow,SM” “Dow 10,SM”
Dow Jones Equity REIT
Index,SM” and “Dow Jones
Internet Commerce Index SM”
are service marks of Dow
Jones & Company, Inc. and
have been licensed for certain
purposes by the Chicago Board
Options Exchange, Inc. Options
based on the Dow Jones
Indexes are not sponsored,
endorsed, sold or promoted
by Dow Jones, and Dow Jones
makes no representation
regarding the advisability of
investing in such products.
CBOE,® Chicago Board Options
Exchange,® FLEX,® FLexible
EXchange,® LEAPS® and OEX®
are registered trademarks of
the Chicago Board Options
Exchange, Inc. Best Execution
Assurance Program,SM
CBOEdirect,TM CBOEflex.net,TM
CBOE Volatility Index,SM Long-
term Equity AnticiPation
Securities,TM MNX,SM SPX,TM
VIX,SM VXNSM and XEOSM are
trademarks of the Chicago
Board Options Exchange, Inc.
“MITTS®” is a registered service
mark and “Market Index
Target-Term Securities SM”
is a service mark owned by
Merrill Lynch & Co., Inc.
Goldman Sachs & Co. has
trade name and trademark
rights to the designations
“GSTITM” and “Goldman Sachs”
and such designations have
been licensed to the Chicago
Board Options Exchange, Inc.
for use in connection with
the trading of options based
upon the Goldman Sachs
Technology Indexes.
iSharesSM are distributed by
SEI Investments Distribution Co.
Barclays Global Fund Advisors
serves as an advisor to iShares
and is not affiliated with SEI.
iShares are not sponsored,
endorsed, sold or promoted by
Standard & Poor’s. iShares is a
service mark of Barclays
Global Investors, N.A.
Incorporated and has been
licensed for use by the Chicago
Board Options Exchange, Inc.
Nasdaq-100,® Nasdaq-100
Index,® Nasdaq,® The Nasdaq
Stock Market,® Nasdaq-100
Shares,SM and Nasdaq-100
TrustSM are trademarks of The
Nasdaq Stock Market, Inc.
The Nasdaq-100 Index® is
determined, composed, and
calculated by Nasdaq without
regard to CBOE, The Nasdaq-
100 Trust,SM or the beneficial
owners of Nasdaq-100
Shares.SM The corporations
make no warranty, express or
implied, and bear no liability
with respect to The Nasdaq-
100 Index,® its use, or any
data included therein.
The NYSE Composite Index®
is a registered trademark of
the New York Stock Exchange,
Inc. NYSE does not issue, offer,
sell, sponsor, or recommend
or provide a facility for the
offer or sale of options based
on the NYSE Composite Index.
Standard & Poor’s,® S&P,®
S&P 100® and S&P 500® are
registered trademarks of The
McGraw-Hill Companies, Inc.
and are licensed for use by the
Chicago Board Options
Exchange, Inc.
The S&P SmallCap 600TM
Stock Index is a trademark
of McGraw-Hill, Inc. and
is licensed for use by the
Chicago Board Options
Exchange, Inc.
“TARGETS®” is a registered
service mark of Salomon
Smith Barney Holdings Inc.
1999 TEN+SM and 2000 TEN+SM
are service marks of Salomon
Smith Barney Holdings Inc.
©2001 Chicago Board Options
Exchange, Inc.
All rights reserved. Printed in
the USA.
Design: Liska + Associates, Inc.
Photography: Tim Bieber,
Mark Battrell
Printing: Active Graphics, Inc.
“Morgan Stanley Multinational
Index SM” is a service mark
of Morgan Stanley & Co.
The Russell 2000® Index is a
registered trademark of The
Frank Russell Company.
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