Exchange. Bulletin. July 2, 2010 Volume 38, Number 27 TRADING PERMIT INFORMATION FOR 6/24/10 THROUGH 6/30/10

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1 Exchange July 2, 2010 Volume 38, Number 27 Bulletin The Bylaws and Rules of Chicago Board Options Exchange, Incorporated ( Exchange ), in certain specific instances, require the Exchange to provide notice to Exchange Trading Permit Holders. To satisfy this requirement, a copy of the Exchange Bulletin, including the Regulatory Bulletin, is delivered by or by hard copy free of charge to all effective Trading Permit Holders on a weekly basis. Trading Permit Holders are encouraged to receive the Exchange and Regulatory Bulletin and Information Circulars via . subscriptions may be obtained by submitting your name, firm if applicable, address, and phone number, to tradingpermits@cboe.com. If you do sign up for delivery, please remember to inform the Registration Services Department of address changes. Subscriptions for hard copy delivery may be obtained by submitting your name, firm if any, mailing address and telephone number to: Chicago Board Options Exchange, Registration Services Department, 400 South LaSalle, Chicago, Illinois 60605, Attention: Bulletin Subscriptions. For access to the CBOE Trading Permit Holder Web Site, please also notify the Registration Services Department by sending an to tradingpermits@cboe.com or by phone at Copyright 2010 Chicago Board Options Exchange, Incorporated TRADING PERMIT INFORMATION FOR 6/24/10 THROUGH 6/30/10 TRADING PERMIT APPLICATIONS RECEIVED FOR WHICH BULLETIN PUBLICATION IS REQUIRED Individual Applicants Date Posted Rodrigo H. Levy, Nominee 6/25/10 J.T. Limited Partnership 1221 Greenwood Ave. Wilmette, IL Lucas D. Johnson, Nominee 6/25/10 Infinium Securities, LLC 215 N. Aberdeen, Suite 401A Chicago, IL PRE-DEMUTUALIZATION MEMBERSHIP LEASES New Leases Effective Date Lessor: Alpha Industries, LLC 6/18/10 Lessee: 303 Equity Trading Group II, LLC Rate: $ Term: 1 Day Termi- Terminated Leases nation Date Lessor: CCD #1, Inc. 6/18/10 Lessee: 303 Equity Trading Group II, LLC Edward Reynolds, Nominee 6/28/10 Citadel Securities LLC 540 N. State St., #3403 Chicago, IL Benjamin B. Bates, Nominee 6/28/10 Citadel Securities LLC 440 N. Wabash Ave., Suite 5009 Chicago, IL TPH Organization Applicants Date Posted T3 Securities, LLC 6/28/10 1 State Street, 10th Floor New York, NY Sean Handelman Owner/CEO Evan Lazarus Owner/CKO Kris Minogue FINOP Scott Redler Owner/CSO Nadav Sapeika Owner/CCO Marc Sperling Owner/President Alexandria Capital Partners 6/25/ North Broad St. Colmar, PA Alexandria Capital Management LLC General Partner John Hewson Shareholder Ousama Fayek Chief Compliance Officer Scott Frinzi Chief Financial Officer Tamir Hashem Chief Technology Officer John Hewson Chief Executive Officer Roberto Ippoldo Chief Risk Officer Sunny Wong Chief Operating Officer TERMINATIONS Nominee: Termination Date Terrence J. Andrews (TAN) 6/24/10 CTC LLC Noah A. Warsaw (NOA) 6/30/10 Group One Trading, L.P.

2 Page 2 July 2, 2010 Volume 38, Number 27 Chicago Board Options Exchange EFFECTIVE TRADING PERMIT HOLDERS Individuals Nominee: Effective Date TPH Organizations Effective Date Lime Brokerage LLC 6/24/10 Type of Business to be Conducted: Non Member Customer Business John N. Jacobs 6/24/10 Lime Brokerage LLC Type of Business to be Conducted: Floor Broker Terrence J. Andrews (TAN) 6/28/10 CTC XS LLC Type of Business to be Conducted: Floor Broker Trevor Wenberg (TVR) 6/28/10 Atlantic Trading Indices LLC Type of Business to be Conducted: Market Maker Stephen W. Nelson (NLE) 6/30/10 Rosenthal Global Securities, L.L.C. Type of Business to be Conducted: Market Maker RESEARCH CIRCULARS The following Research Circulars were distributed between June 25, 2010 and June 30, If you wish to read the entire document, please refer to the CBOE website at and click on the Trading Tools Tab. New listings and series information is also available in the Trading Tools section of the website. For questions regarding information discussed in a Research Circular, please call The Research Circular #RS June 25, 2010 XTO Energy, Inc. ( XTO ) Merger COMPLETED with Exxon Mobil Corporation ( XOM ) Effective Date: June 25, 2010 Research Circular #RS XL Capital Ltd Class A ( XL ) Name Change to: XL Group plc Effective Date: July 1, 2010 Research Circular #RS Vishay Intertechnology, Inc. ( VSH ) Distribution of Shares of Vishay Precision Group, Inc. ( VPG ) Ex-Distribution Date: July 7, 2010 Research Circular #RS Open Joint Stock Company/Vimpel-Communications ( OVIP ) Anticipated Cash Settlement/Delayed Settlement Research Circular #RS Terra Nova Royalty Corporation ( TTT & adj. TTT1 ) Distribution of Shares of KHD Humboldt Wedag International (Deutschland) AG Ex-Distribution Date: June 29, 2010 Research Circular #RS NTT DoCoMo, Inc. ( DCM ) Name Change to: NTT DOCOMO, Inc. Effective Date: June 30, 2010 Research Circular #RS MSCI Inc. Class A ( MXB ) Underlying Symbol Change to MSCI Effective Date: July 6, 2010 Research Circular #RS June 29, 2010 E*TRADE Financial Corporation ( ETFCD/ETFC & adj. ETFC1 ) Underlying Symbol Change to ETFC Effective Date: June 30, 2010 Research Circular #RS June 30, 2010 OceanFreight Inc. ( OCNFD/OCNF & adj. OCNF1 ) Determination of Cash-in-Lieu Amount Effective Date: June 17, 2010 Research Circular #RS June 30, 2010 Pharmaceutical Product Development, Inc. ( PPDI & adj. PPDI1 ) Determination of Cash-in-Lieu Amount Ex-Date: June 2, 2010 Research Circular #RS June 30, 2010 Myriad Pharmaceuticals, Inc. ( MYRX ) Name Change to: Myrexis, Inc. Effective Date: July 1, 2010 POSITION LIMIT CIRCULARS Pursuant to Exchange Rule 4.11, the Exchange issued the below listed Position Limit Circular on. The complete circulars are available from the Department of Market Regulation, in the data information bins on the 2nd Floor of the Exchange, and on the CBOE website at cboe.com under the Market Data tab. To receive regular updates of the position limit list via fax, contact Candice Nickrand at (312) Questions concerning position and exercise limits may be directed to the Department of Market Regulation to Joe Acevedo at (312) or Tim MacDonald at (312) Postition Limit Circular PL10-23 XTO Energy, Inc. ( XTO ) Merger COMPLETED with Exxon Mobil Corporation ( XOM ) Effective Date: Tuesday, June 25, 2010

3 July 2, 2010 Volume RB21, Number 27 The Bylaws and Rules of Chicago Board Options Exchange, Incorporated ( Exchange ), in certain specific instances, require the Exchange to provide notice to Trading Permit Holders. The weekly Regulatory Bulletin is delivered to all effective Trading Permit Holders to satisfy this requirement. Copyright 2010 Chicago Board Options Exchange, Incorporated. REGULATORY CIRCULARS Regulatory Circular RG10-69 To: From: Members Legal Division Member and Regulatory Services Division Date: June 14, 2010 Re: Rule Change Regarding Correlated Instruments Delta Hedge Exemption On May 27, 2010, the SEC approved SR-CBOE amending CBOE Rules 4.11, 24.4 and 24.4A with respect to correlated instruments delta hedge exemption. 1 Implementation is operative as of the date of this circular. The following summarizes the amendments: (i) The rule amendment expands the delta based exemption by amending Rule (c)(A) to permit equity option positions for which the underlying security is an ETF that is based on the same index as an index option to be combined with an index option position for calculation of the delta-based equity hedge exemption. The rule allows financial products such as securities index options, index futures, and options on index futures to be included along with the ETF in an equity option s net delta calculation. So for example, the proposed rule would allow SPY options to be hedged not only with SPY shares, but with S&P 500 options, S&P 500 futures, options on S&P 500 futures or any other instrument that tracks the performance of or is based on the S&P 500 index. This would be accomplished by including such positions with a related index option position in accordance with the Delta-Based Index Hedge Exemption. (ii) The rule amendment also amends the reporting requirements applicable to members relying on the delta hedging exemption to exempt from the reporting requirements Exchange Market-Makers and Designated Primary Market-Makers ( DPMs ) relying on the Exemption who use the Options Clearing Corporation ( OCC ) pricing model, because Market-Maker and DPM position and delta information can be accessed through the Exchange's market surveillance systems. 1 Rules 24.4 and 24.4A provide position limits for broad-based index options, industry index options, respectively. July 2, 2010 Volume RB21, Number 27 1

4 (iii) The rule amendment also adopts a delta hedging exemption from certain index options position limits. A delta-based index hedge exemption would provide market participants the ability to accumulate an unlimited number of index options contracts provided that such contracts are properly delta hedged in accordance with the requirements of the exemption. Please be advised that the Exemption is not currently available to be utilized by customers. CBOE will announce to Member organizations when the Exemption is available to be utilized for customers. Further questions about the applicability of the Correlated Instrument Delta Hedge Exemption should be directed to the Department of Market Regulation at (312) or (312) Regulatory Circular RG10-77 To: From: Trading Permit Holders Market Quality Assurance Department Regulatory Division Date: June 30, 2010 Re: Weekly Option Series Beginning on Thursday, July 1, 2010 all new Weekly option series (also referred to as Short Term option series ) at CBOE will begin trading on Thursdays and expire the following Friday. Previously, new Weekly option series were listed each Friday and expired the following Friday. No new Weekly option series will be listed that would expire during the expiration week for standard options (the third Friday of each month) or during a week when the expiration coincides with an expiration of quarterly option series on the same class. DPMs, edpms, LMMs and MMs are reminded that the Exchange considers Short Term options as an additional series on an underlying product, and therefore the continuous quoting obligations, as defined in CBOE Rules 8.85, 8.93, 8.15, 8.15A and 8.7 respectively, apply to Short Term options. Failure to comply with the requirements set forth in CBOE Rules 8.7, 8.15, 8.15A, 8.85 and 8.93 may result in remedial market performance action and/or disciplinary action. A list of the underlying products that CBOE lists Weekly option series on is available on the Exchange s website at For questions regarding quoting obligations, please contact Allison Kile (312) or Timothy MacDonald at (312) July 2, 2010 Volume RB21, Number 27 2

5 R U L E C H A N G E S APPROVED RULE CHANGE(S) The Securities and Exchange Commission ( SEC ) has approved the following change(s) to Exchange rules pursuant to Section 19(b) of the Securities Exchange Act of 1934, as amended (the Act ). Below, any additions to rule text are underlined, and any deletions are [bracketed]. Copies are available on the CBOE public website at The effective date of the rule change is the date of approval unless otherwise noted. SR-CBOE Hybrid Matching Algorithms On June 17, 2010, the SEC approved Rule Change File No. SR-CBOE , which filing amends Rules 6.45A, Priority and Allocation of Equity Option Trades on the CBOE Hybrid System, and 6.45B, Priority and Allocation of Trades in Index Options and Options on ETFs on the CBOE Hybrid System, to revise the market turner and modified participation entitlement priority overlays. Any questions regarding the rule change may be directed to Jennifer Lamie, Legal Division, at The rule text is shown below and the rule filing is available at Rule 6.45A - Priority and Allocation of Equity Option Trades on the CBOE Hybrid System (a) Allocation of Incoming Electronic Orders: The Exchange will determine to apply, for each class of options, one of the following rules of trading priority described in paragraphs (i) or (ii). The Exchange will issue a Regulatory Circular periodically specifying which priority rules will govern which classes of options any time the Exchange changes the priority. (ii) Price-Time or Pro-Rata Priority Additional Priority Overlays Applicable to Price-Time or Pro-Rata Priority Methods In addition to the base allocation methodologies set forth above, the Exchange may determine to apply, on a class-by-class basis, one or more of the following designated market participant overlay priorities in a sequence determined by the Exchange. The Exchange will issue a Regulatory Circular periodically which will specify which classes of options are subject to these additional priorities as well as any time the Exchange changes these priorities. (3) Modified Participation Entitlement: This participation entitlement is the same as provided in subparagraph (2) above or subparagraph (iii)(1) below, except [as follows: Notwithstanding subparagraph (2)(D) above,] the participation entitlement shall only be applied to the execution of an inbound order if [there are no Public Customer orders resting at the best price or if a Public Customer was the first to rest interest at the best price] the amount the Market-Maker would be entitled to pursuant to the participation entitlement is greater than the amount the Market-Maker would otherwise receive pursuant to the operation of the Algorithm described above. In all other cases, the participation entitlement and public customer priority will not be applied. (A) The Market-Maker entitlement shall be calculated based on any remaining balance after all public customer orders at the best price are July 2, 2010 Volume RB21, Number 27 3

6 satisfied. For options classes where the Algorithm uses the pro-rata method, the Exchange may determine on a class-by-class basis to calculate the Market-Maker s entitlement share using the UMA method provided in subparagraph (a)(i)(c) above or the pro-rata method provided in subparagraph (b)(ii)(2) above. (B) When calculating the amount the Market-Maker would otherwise receive pursuant to the operation of the Algorithm, the participation entitlement and public customer priority will not be [in effect] considered. The[is] modified participation entitlement overlay is only applicable to automatic executions and will not be applicable for executions of incoming electronic orders initiated from PAR or for electronic auctions. In classes where the UMA method is selected to calculate the Market-Maker entitlement, executions of incoming electronic orders initiated from PAR and electronic auctions will be allocated using the UMA method. [(4) Market Turner: Market Turner means a party that was the first to enter an order or quote at a better price than the previous best disseminated Exchange price and the order (quote) is continuously in the market until the particular order (quote) trades. There may be a Market Turner for each price at which a particular order trades. When this priority overlay is in effect, the Market Turner has priority at the highest bid or lowest offer that he established. The Market Turner priority at a given price remains with the order (quote) once it is earned. For example, if the market moves in the same direction as the direction in which the order from the Market Turner moved the market, and then the market moves back to the Market Turner s original price, then the Market Turner retains priority at the original price. Market Turner priority cannot be established until after the opening print and/or the conclusion of the opening rotation and, once established, shall remain in effect until the conclusion of the trading session. The Exchange may determine, on a class-by-class basis, to reduce the Market Turner priority to a percentage of each inbound order that is executable against the Market Turner. In such cases, the Market Turner may participate in the balance of an order, pursuant to the allocation procedure in effect, after the Market Turner priority has been applied. To the extent the Market Turner order (quote) is not fully exhausted, it shall retain Market Turner priority for subsequent inbound orders until the conclusion of the trading session.] (iii) Additional Priority Overlays Applicable to [Small Orders] All Priority Methods In addition to the base allocation methodologies set forth above, the Exchange may determine to apply, on a class-by-class basis, the following priority overlays. The Exchange will issue a Regulatory Circular periodically specifying which classes of options are subject to th[is]ese additional priorit[y]ies any time the Exchange changes these priorit[y]ies. (1) Small Order Preference: (A) (D) No change. (2) Market Turner: Market Turner means a party that was the first to enter an order or quote at a better price than the previous best disseminated Exchange price and the order (quote) is continuously in the market until the particular order (quote) trades. There may be a Market Turner for each price at which a particular order trades. When this priority overlay is in effect, the Market Turner has priority at the highest bid or lowest offer that he established. The Market Turner priority at a given price remains with the order (quote) once it is earned. For example, if the market moves in the same direction as the direction in which the order from the Market Turner moved the market, and then the market moves back to the Market Turner s July 2, 2010 Volume RB21, Number 27 4

7 original price, then the Market Turner retains priority at the original price. Market Turner priority cannot be established until after the opening print and/or the conclusion of the opening rotation and, once established, shall remain in effect until the conclusion of the trading session. The Exchange may determine, on a class-by-class basis, to reduce the Market Turner priority to a percentage of each inbound order that is executable against the Market Turner. In such cases, the Market Turner may participate in the balance of an order, pursuant to the allocation procedure in effect, after the Market Turner priority has been applied. To the extent the Market Turner order (quote) is not fully exhausted, it shall retain Market Turner priority for subsequent inbound orders until the conclusion of the trading session. Rule 6.45B - Priority and Allocation of Trades in Index Options and Options on ETFs on the CBOE Hybrid System (a) Allocation of Incoming Electronic Orders: The Exchange will determine to apply, for each class of options, one of the following rules of trading priority described in paragraphs (i) or (ii). The Exchange will issue a Regulatory Circular periodically specifying which priority rules will govern which classes of options any time the Exchange changes the priority. (i) Price-Time or Pro-Rata Priority Additional Priority Overlays Applicable to Price-Time or Pro-Rata Priority Methods (3) Modified Participation Entitlement: This participation entitlement is the same as provided in subparagraph (2) above or subparagraph (iv)(1) below, except [as follows: Notwithstanding subparagraph (2)(D) above,] the participation entitlement shall only be applied to the execution of an inbound order if [there are no Public Customer orders resting at the best price or if a Public Customer was the first to rest interest at the best price] the amount the Market-Maker would be entitled to pursuant to the participation entitlement is greater than the amount the Market-Maker would otherwise receive pursuant to the operation of the Algorithm described above. In all other cases, the participation entitlement and public customer priority will not be applied. (A) The Market-Maker entitlement shall be calculated based on any remaining balance after all public customer orders at the best price are satisfied. For options classes where the Algorithm uses the pro-rata method, the Exchange may determine on a class-by-class basis to calculate the Market-Maker s entitlement share using the pro-rata method provided in subparagraph (a)(i)(2) above or the UMA method provided in subparagraph (a)(ii)(c) below. (B) When calculating the amount the Market-Maker would otherwise receive pursuant to the operation of the Algorithm, the participation entitlement and public customer priority will not be [in effect] considered. The[is] modified participation entitlement overlay is only applicable to automatic executions and will not be applicable for executions of incoming electronic orders initiated from PAR or for electronic auctions. In classes where the UMA method is selected to calculate the Market-Maker entitlement, executions of incoming electronic orders initiated from PAR and electronic auctions will be allocated using the UMA method. July 2, 2010 Volume RB21, Number 27 5

8 [(4) Market Turner: Market Turner means a party that was the first to enter an order or quote at a better price than the previous best disseminated Exchange price and the order (quote) is continuously in the market until the particular order (quote) trades. There may be a Market Turner for each price at which a particular order trades. When this priority overlay is in effect, the Market Turner has priority at the highest bid or lowest offer that he established. The Market Turner priority at a given price remains with the order (quote) once it is earned. For example, if the market moves in the same direction as the direction in which the order from the Market Turner moved the market, and then the market moves back to the Market Turner s original price, then the Market Turner retains priority at the original price. Market Turner priority cannot be established until after the opening print and/or the conclusion of the opening rotation and, once established, shall remain in effect until the conclusion of the trading session. The Exchange may determine, on a class-by-class basis, to reduce the Market Turner priority to a percentage of each inbound order that is executable against the Market Turner. In such cases, the Market Turner may participate in the balance of an order, pursuant to the allocation procedure in effect, after the Market Turner priority has been applied. To the extent the Market Turner order (quote) is not fully exhausted, it shall retain Market Turner priority for subsequent inbound orders until the conclusion of the trading session.] (iii) Additional Priority Overlays Applicable to [Small Orders] All Priority Methods In addition to the base allocation methodologies set forth above, the Exchange may determine to apply, on a class-by-class basis, the following priority overlays. The Exchange will issue a Regulatory Circular periodically specifying which classes of options are subject to th[is]ese additional priorit[y]ies any time the Exchange changes these priorit[y]ies. (1) Small Order Preference: (A) (D) No change. (2) Market Turner: Market Turner means a party that was the first to enter an order or quote at a better price than the previous best disseminated Exchange price and the order (quote) is continuously in the market until the particular order (quote) trades. There may be a Market Turner for each price at which a particular order trades. When this priority overlay is in effect, the Market Turner has priority at the highest bid or lowest offer that he established. The Market Turner priority at a given price remains with the order (quote) once it is earned. For example, if the market moves in the same direction as the direction in which the order from the Market Turner moved the market, and then the market moves back to the Market Turner s original price, then the Market Turner retains priority at the original price. Market Turner priority cannot be established until after the opening print and/or the conclusion of the opening rotation and, once established, shall remain in effect until the conclusion of the trading session. The Exchange may determine, on a class-by-class basis, to reduce the Market Turner priority to a percentage of each inbound order that is executable against the Market Turner. In such cases, the Market Turner may participate in the balance of an order, pursuant to the allocation procedure in effect, after the Market Turner priority has been applied. To the extent the Market Turner order (quote) is not fully exhausted, it shall retain Market Turner priority for subsequent inbound orders until the conclusion of the trading session. July 2, 2010 Volume RB21, Number 27 6

9 EFFECTIVE-ON-FILING RULE CHANGE(S) The following rule filing(s) were submitted to the SEC effective on filing, and may have taken effect pursuant to Section 19(b)(3) of the Act. They will remain in effect barring further action by the SEC within 60 days after publication in the Federal Register. Below, any additions to rule text are underlined, and any deletions are [bracketed]. Copies are available on the CBOE public website at SR-CBOE CBSX Fees Schedule On June 25, 2010, the Exchange filed Rule Change File No. SR-CBOE , which filing proposes to modify the CBSX fee schedule regarding qualified contingent trade (QCT) cross trades. Any questions regarding the rule change may be directed to Angelo Evangelou, Legal Division, at The rule filing is available at CBOE pdf. SR-CBOE $1 Strike Price Program On June 30, 2010, the Exchange filed Rule Change File No. SR-CBOE , which filing proposes to amend Rule to expand the Exchange s $1 Strike Price Program to allow the Exchange to select 150 individual stocks on which options may be listed at $1 strike price intervals. Any questions regarding the rule change may be directed to Jenny Klebes, Legal Division, at The rule text is shown below and the rule filing is available at Rule 5.5 Series of Option Contracts Open for Trading RULE 5.5 No change. Interpretations and Policies:.01 The interval between strike prices of series of options on individual stocks may be: a. The $1 Strike Program. (1) $1.00 or greater ( $1 strike prices ) provided the strike price is $50.00 or less, but not less than $1. Except as provided in subparagraph 3 below, the listing of $1 strike prices shall be limited to options classes overlying no more than [55] 150 individual stocks as specifically designated by the Exchange. The Exchange may list $1 strike prices on any other option classes if those classes are specifically designated by other securities exchanges that employ a similar $1 Strike Program under their respective rules. (2) (4) No change. b. e. No change No change. SR-CBOE Fees Schedule On June 30, 2010, the Exchange filed Rule Change File No. SR-CBOE , which filing proposes to reduce the payments that CBOE makes to CBOE Trading Permit Holders that participate in a program under which CBOE subsidizes the costs of providing and/or using certain order routing July 2, 2010 Volume RB21, Number 27 7

10 functionalities. If a Trading Permit Holder has elected not to have CBOE perform certain marketing services on its behalf, the payment would be reduced, with respect to orders routed to CBOE through a participating Trading Permit Holder s system, from $0.05 per contract to $0.04 per contract. If a Trading Permit Holder has elected to have CBOE perform marketing services on its behalf, the payment with respect to such orders would be reduced from $0.04 per contract to $0.03 per contract. The Exchange intends to make the change effective commencing August 1, Any questions regarding the rule change may be directed to Andrew Spiwak, Legal Division, at The rule filing is available at PROPOSED RULE CHANGE(S) Pursuant to Section 19(b)(1) of the Act, and Rule 19b-4 thereunder, the Exchange has filed the following proposed rule change(s) with the SEC. Below, any additions to rule text are underlined, and any deletions are [bracketed]. Copies of the rule change filing(s) are available at Members may submit written comments to the Legal Division. The effective date of a proposed rule change will be the date of approval by the SEC, unless otherwise noted. SR-CBOE CBSX Odd-Lot Orders On June 25, 2010, the Exchange filed Rule Change File No. SR-CBOE , which filing proposes to modify the manner in which odd lot orders are handled on CBSX. Any questions regarding the rule change may be directed to Angelo Evangelou, Legal Division, at The rule text is shown below and the rule filing is available at Rule 52.8 Processing of Odd-Lot Orders [Upon receipt, Odd-Lot orders (including the Odd-Lot portion of a mixed-lot order) will be displayed to CBSX Traders for a period of time not to exceed 1 second as determined by CBSX. The indication will also provide the applicable NBBO price for that product. Responses to trade against an Odd-Lot order may only be submitted at the applicable NBBO price or better and must be for the full size of the Odd-Lot order. The first CBSX Trader to respond will trade against the Odd-Lot order. If no responses are received, the order shall execute at the best price being quoted by CBSX Market-Makers on the CBSX System. Odd- Lot orders with limit price that are not marketable will be entered into an Odd-Lot Order book where CBSX Traders may submit orders to trade against resting interest.] Odd-Lot orders (including the Odd-Lot portion of a mixed-lot order) will be processed in the same manner as are round-lot orders pursuant to Rule 52.6, except: (a) if an incoming odd-lot order trades against a quote in the CBSX Book, the new quantity remaining in the quote will be rounded down to the nearest lower round-lot amount (zero or multiple of 100) for display purposes, with the remaining Odd-Lot amount being cancelled; and (b) if an incoming order trades against a limit order resting on the CBSX Book and an Odd- Lot amount remains from the limit order resting on the CBSX Book, that Odd-Lot amount will remain in the system eligible for execution but will not be displayed.... Interpretations and Policies: July 2, 2010 Volume RB21, Number 27 8

11 .01 The [odd lot]odd-lot portion of orders/trades will not be disseminated by CBSX for quotations or last sale reporting. [.02 Users may also submit Odd-Lot Orders that will cancel if an NBBO or better execution is not attained.] SR-CBOE CBSX Procedures for Individual Stock Trading Pauses On June 30, 2010, the Exchange filed Rule Change File No. SR-CBOE , which filing proposes to amend Rule 6.3C, Individual Stock Trading Pauses Due to Extraordinary Market Volatility, to add stocks included in the Russell 1000 Index and specified Exchange Traded Products to the pilot. Any questions regarding the rule change may be directed to Jennifer Lamie, Legal Division, at The rule text is shown below and the rule filing is available at Rule 6.3C - Individual Stock Trading Pause Due to Extraordinary Market Volatility RULE 6.3C. If a primary listing market issues an individual stock trading pause in any of the Circuit Breaker Stocks, as defined in Interpretation and Policy.03 of this Rule, the Exchange will halt trading in that stock until trading has resumed on the primary listing market. If, however, trading has not resumed on the primary listing market after ten minutes have passed since the individual stock trading pause message has been received from the responsible single plan processor, the Exchange may resume trading in such stock.... Interpretations and Policies:.01 Upon reopening, a rotation shall be held in the individual stock unless the Exchange concludes that a different method of reopening is appropriate under the circumstances, including but not limited to, no rotation, an abbreviated rotation or any other variation in the manner of the rotation..02 Nothing in this Rule shall be construed to limit the ability of the Exchange to halt or suspend trading in any security or securities traded on the Exchange pursuant to any other Exchange rule or policy..03 The provisions of this Rule shall be in effect during a pilot period ending December 10, For the pilot period, the term Circuit Breaker Stocks shall mean the stocks included in the S&P 500 Index, the Russell 1000 Index, as well as a pilot list of Exchange Traded Products. July 2, 2010 Volume RB21, Number 27 9