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Filed by Board of Trade of the City of Chicago, Inc. (CBOT)
Subject Company -- Board of Trade of the City of Chicago, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
File No. 132-01854
* * * *
The following materials were distributed to CBOT members entitled to vote after
the close of business on September 27, 2000.
September 27. 2000
NOTICE OF SPECIAL MEETING
-------------------------
To: Voting Members
The Board of Directors of the Board of Trade of the City of Chicago, Inc. (the
"CBOT(R)") has called for a Special Meeting of the Membership, to be held at
2:30 p.m., Central time on October 12, 2000 in the Visitor Center Theater, Fifth
Floor of the CBOT's offices at 141 West Jackson Blvd., Chicago, Illinois 60604,
for the purpose of conducting a membership vote on a proposition to amend the
Charter, Bylaws and Rules of the CBOT, which is described more fully in the
enclosed Ballot Disclosure. Holders of record of Full Memberships and Associate
Memberships as of September 27, 2000 will be entitled to vote in connection with
the Special Meeting of the Membership.
As a result of the CBOT's reincorporation in Delaware, the Special Meeting of
the Membership and related Proxy Ballot solicitation will be conducted in
accordance with the CBOT's Amended and Restated Certificate of Incorporation
("Charter") and Amended and Restated Bylaws ("Bylaws"), which, as set forth in
the Charter, include the Rules, and applicable Delaware law. The proposition
set forth in the Ballot Disclosure is being submitted to a vote of the
Membership pursuant to Sections 5 and 7 of Exhibit A to the CBOT's Charter.
PLEASE NOTE THE FOLLOWING INSTRUCTIONS:
Instructions
------------
1. Mark the enclosed Proxy Ballot and provide your signature, printed name and
date, enclose and seal the completed Proxy Ballot in the gold envelope
addressed to the Secretary. The Proxy Ballot must be signed in order to be
effective.
2. Print your name in the upper left-hand corner of the gold envelope and
deliver or mail it to the Secretary's Office.
Returning your completed Proxy Ballot will not prevent you from voting in person
at the Special Meeting of the Membership if you are present and wish to vote.
Please note, however, that if you vote by Proxy Ballot, you will not need to
attend the Special Meeting of the Membership, or take any further action in
connection with the proxy voting at the Special Meeting, because you already
will have directed the Proxy how you wish to vote with respect to the
proposition. You may revoke your Proxy Ballot at any time before the Special
Meeting of the Membership by providing written notice to the Secretary or by
submission of a later-dated Proxy Ballot.
If you have any questions concerning this letter or the voting process on this
proposition, please do not hesitate to contact the Secretary's Office at (312)
435-3605.
By order of the Board of Directors,
/s/ Paul J. Draths
Paul J. Draths
Vice President and Secretary
<PAGE>
September 27, 2000
BOARD OF TRADE
OF THE CITY OF CHICAGO, INC. (CBOT(R))
BALLOT DISCLOSURE
TO MEMBERS:
The Board of Directors has called for a Special Meeting of the Membership, to be
held at 2:30 p.m. Central time on THURSDAY, OCTOBER 12, 2000 in the Visitor
Center Theater, Fifth Floor of the CBOT's offices at 141 West Jackson Blvd.,
Chicago, Illinois 60604 for the purpose of conducting a membership vote on the
proposition described below. Holders of record of Full Memberships and
Associate Memberships as of the close of business on September 27, 2000 will be
entitled to vote in connection with the Special Meeting of the Membership.
As a result of the CBOT's reincorporation in Delaware, the Special Meeting of
the Membership and related Proxy Ballot solicitation will be conducted in
accordance with the CBOT's Amended and Restated Certificate of Incorporation
("Charter") and the Amended and Restated Bylaws ("Bylaws"), which, as set forth
in the Charter, include the Rules, and applicable Delaware law. The proposition
set forth herein is being submitted to a vote of the Membership pursuant to
Sections 5 and 7 of Exhibit A to the CBOT's Charter.
PROPOSITION - COMMENT
This proposition was adopted by the Board of Directors on September 27, 2000
upon the recommendation of the Executive Committee.
The proposal, if approved by the membership, would result in amendments to the
CBOT's Charter, Bylaws and Rules which would reduce the size of both the Board
of Directors and the Nominating Committee.
Currently, the CBOT's Charter, Bylaws and Rules specify a 27-person Board of
Directors and a 7-person Nominating Committee for the Exchange. These
respective groups are comprised as follows:
- Board of Directors: Chairman of the Board (two-year term of office), First
and Second Vice Chairmen of the Board (staggered two-year terms), President
(a non-voting Board member), 15 Full Member Directors (staggered three-year
terms), 3 Associate Member Directors (staggered three-year terms) and 5
non-member "public" Directors (staggered four-year terms).
- Nominating Committee: 6 Full Members (staggered three-year terms) and 1
Associate Member (three-year term).
The proposed amendments would reduce the authorized size of the Board of
Directors to 18 positions, and the Nominating Committee to 5 positions,
comprised as follows:
- Board of Directors: Chairman of the Board (two-year term of office), Vice
Chairman of the Board (two-year term), President (non-voting), 9 Full
Member Directors (staggered three-year terms), 2 Associate Member Directors
(staggered three-year terms) and 4 non-member "public" Directors (staggered
four-year terms).
- Nominating Committee: 4 Full Members (staggered three-year terms) and 1
Associate Member (three-year term).
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As described more fully below, the elimination of certain directorships and
positions on the Nominating Committee would be implemented as follows:
- Seven Board directorships whose terms expire at the end of 2000 (i.e., -
the Second Vice Chairman, 5 Full Member Directors and 1 Associate Member
Director) would be eliminated.
Also, one currently vacant Full Member directorship (for the term expiring
in December 2001) would be eliminated.
There would be an election in December, 2000 only for the office of
Chairman of the Board.
- One non-member "public" directorship whose term expires in December, 2000
would be eliminated.
- Two Full Member positions on the Nominating Committee whose terms expire at
the end of 2000 would be eliminated.
This proposal is designed to advance the Exchange's overall strategic goals by
helping to streamline the CBOT's corporate governance mechanism.
The CBOT Charter as it is proposed to be amended and restated is set forth in
its entirety as Exhibit I. The pertinent CBOT Bylaws as they are proposed to be
amended and the pertinent CBOT Rule as it is proposed to be amended are set
forth in Exhibit II. We urge you to read these documents carefully before
deciding how to vote on this proposition.
THE BOARD RECOMMENDS ADOPTION OF THIS PROPOSITION.
/s/ Paul J. Draths
Paul J. Draths
Vice President and Secretary
The CBOT urges you to read the Registration Statement on Form S-4, including the
proxy statement/prospectus contained within the Registration Statement,
regarding the CBOT restructuring, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the SEC, because they
contain or will contain important information. CBOT members and membership
interest holders may obtain a free copy of the proxy statement/prospectus, when
it becomes available, and other documents filed by the CBOT at the Commission's
website at www.sec.gov, or from the CBOT by directing such request in writing or
by telephone to: Board of Trade of the City of Chicago, Inc., 141 W. Jackson
Blvd., Chicago, Illinois 60604, Attention: Office of the Secretary, Telephone:
(312) 435-3605, Facsimile: (312) 347-3827. This communication shall not
constitute an offer to sell or the solicitation of an offer to buy, nor shall
there by any sale of securities in any state in which offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state. No offering of securities shall be made
except by means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
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PROPOSITION
Amend the Charter, Bylaws and Rules of the Board of the City of Chicago, Inc.
(CBOT(R)) as follows to reduce the size of the Board of Directors and of the
Nominating Committee. (Additions underlined; deletions struck through and
bracketed):
AMENDED AND RESTATED
CERTIFICATION OF INCORPORATION
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
ARTICLE SIXTH: The business and affairs of the Corporation shall be
managed by or under the direction of a governing body to be known as the Board
of Directors. Until the first business day of January, 2001, the [****] Board
of Directors shall be comprised of the following twenty-seven members (all of
whom may be referred to hereinafter as "Directors"):
(a) the Chairman of the Board;
(b) the First Vice Chairman of the Board;
(c) the Second Vice Chairman of the Board;
(d) the President of the Corporation (who shall be a non-voting
Director);
(e) fifteen elected Directors who shall be Full Members of the
Corporation and of whom at least three shall be non-resident (defined for
purposes of this provision as a person whose ordinary place of business or
occupation is located more than fifty miles from the Court House of Cook County,
Illinois);
(f) five non-member Directors; and
(g) three Directors who shall be Associate Members of the
Corporation.
Beginning on the first business day of January, 2001, the Board of Directors
shall be comprised of the following eighteen members (all of whom may be
referred to hereinafter as "Directors"):
(a) the Chairman of the Board;
(b) the Vice Chairman of the Board;
(c) the President of the Corporation (who shall be a non-voting
Director);
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(d) nine elected Directors who shall be Full Members of the
Corporation and of whom at least two shall be non-resident
(defined for purposes of this provision as a person whose
ordinary place of business or occupation is located more
than fifty miles from the Court House of Cook County,
Illinois);
(e) four non-member Directors; and
(f) two Directors who shall be Associate Members of the
Corporation.
EXHIBIT A
Section 3. Vote Necessary. The vote required at the Annual Election for
the choice of elective offices shall be as specified in this Section.
(a) Chairman and[, ****] Vice Chairman [****] of the Board. A majority of all
votes cast shall be necessary to elect a Chairman of the Board and to elect
a [****] Vice Chairman [****]. If no candidate received a majority vote
for Chairman of the Board or for [****] Vice Chairman [****] at the Annual
Election, another ballot shall be taken fifteen days later; and if again
there shall be a failure to elect, a third ballot shall be taken on the
fifteenth following day, when a plurality shall elect.
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EXHIBIT B
Section 2. [****] Vice Chairman [****]. The [****] Vice Chairman of
the Board ("[****] Vice Chairman") shall perform the duties of the Chairman of
the Board in his absence or disability. [****.] In the absence or disability of
the Chairman of the Board and the [****] Vice Chairman [****], the Board may
choose temporarily an Acting Chairman of the Board.
Section 5. Tenure of Office.
(a) The Chairman of the Board and the [****] Vice Chairman of the
Board shall hold office for two years. [****.] The elected
Directors shall hold office for three years, except as provided
in Section 7 of this Exhibit B. In addition, non-member Directors
shall be nominated and appointed pursuant to Section 5(d) of this
Exhibit B. [****.] The non-member Director[(****)] who will begin
a new term in the next succeeding year will be nominated and
appointed no sooner than the November Regular Board meeting and
no later than the last business day of the year which precedes
the commencement of the new term. Each non-member Director shall
hold office for four years. All Officers and Directors thus
elected or appointed shall take office on the first business day
in January following the Annual Election and shall hold over in
office until their respective successors are qualified after
election or appointment.
(b) If a vacancy occurs in the office of non-member Director, such
vacancy will be filled by a successor nominated and approved
pursuant to Section 5(d) of this Exhibit B. The successor non-
member Director will take office at the meeting following
approval and shall hold office for the remainder of the
applicable four-year term.
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(c) Beginning with the candidates elected at the First Annual
Election following the adoption of the provisions set forth in
Section 5(c) of this Exhibit B, no member shall be elected by the
Members of the Exchange to more than:
- Three consecutive two-year terms as Chairman of the Board; or
- Three consecutive two-year terms as [****] Vice Chairman of the
Board; or
[- ****]
- Two consecutive three-year terms as elected Director.
The foregoing term limits shall apply separately and distinctly to each of the
specified elective offices (i.e. - Chairman of the Board, [****] Vice Chairman
of the Board, [****], and elected Director). A member who has reached a
consecutive term limit in any one of the specified elective offices shall not
thereby be ineligible for election to any other elective office on the Board.
(d) The names of all candidates for the non-member Directors'
positions shall be submitted to the Corporation's Nominating Committee. It will
be the responsibility of the Nominating Committee to review the qualifications
of the candidates and present to the Board of Directors the names of those
candidates which the Committee believes are best qualified to serve on the Board
of Directors. The Board of Directors will elect candidates from among those
submitted by the Nominating Committee which the Board of Directors believes are
best qualified to serve the Membership.
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Section 7. Elective Officers.
[****]
[****]
a) At the December, 2000 Annual Election and at every second Annual Election
thereafter, the Members of the Exchange shall elect as an officer a Chairman of
the Board.
On the first business day of January, 2001, the office of First Vice
Chairman of the Board shall be retitled and shall become the office of Vice
Chairman of the Board. The term of office previously in effect for the First
Vice Chairmanship of the Board shall become the term of office for the Vice
Chairmanship of the Board. The First Vice Chairman of the Board as of the day
preceding the first business day of January, 2001 shall become the initial
holder of the office of Vice Chairman of the Board. At the December, 2001 Annual
Election and at every second Annual Election thereafter, the Members of the
Exchange shall elect as an officer a Vice Chairman of the Board.
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At the December, 2001 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation), one Director
who shall be an Associate Member (and who shall not be a non-resident member as
defined in Article SIXTH of the Certificate of Incorporation), one member of the
Nominating Committee who shall be a Full Member, and one member of the
Nominating Committee who shall be an Associate Member.
At the December, 2001 Annual Election the Members of the Exchange also
shall elect, for two-year terms, one Director who shall be a Full Member and a
non-resident as defined in Article SIXTH of the Certificate of Incorporation,
and one member of the Nominating Committee who shall be a Full Member.
At the December, 2002 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation), one Director
who shall be an Associate Member (and who shall not be a non-resident member as
defined in Article SIXTH of the Certificate of Incorporation), and two members
of the Nominating Committee who shall be Full Members.
At the December, 2002 Annual Election the Members of the Exchange also
shall elect, for one year terms, two Directors who shall be Full Members.
At the December, 2003 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation) and one member
of the Nominating Committee who shall be a Full Member.
All such officers shall be Full Members of the Corporation and shall remain
as such throughout their terms, with the exception of those Directors and
officers required to be Associate Members, who shall be Associate Members of the
Corporation and who shall remain as such throughout their terms except as
provided in paragraph (b). All of the aforesaid officers shall be referred to
as the "elective officers".
[****.]
(b)(****) An Associate Member Director who has completed at least one
and one-half years of his/her current term of office may continue in that office
of Director for the remainder of that term provided that such Director
continuously remains either an Associate Member of the Corporation or a Full
Member of the Corporation.
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AMENDED AND RESTATED
BYLAWS
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
ARTICLE II, Section 4. Nominations and Annual Election.
Each year by no later than the first Wednesday in November, the
Nominating Committee shall hold at least three meetings, of which due notice
shall be posted on the bulletin board. All members may attend such meetings and
suggest nominees for the offices to be filled at the following election. In
selecting candidates, the Committee shall give special consideration to the
desirability of having all interests of the Corporation represented on the
Board. At least one candidate for Director at each applicable Annual Election
must be a non-resident Full Member as defined in Article SIXTH of the
Certificate of Incorporation.
ARTICLE III, Section 2. Quorum. Ten [Twelve] members of the Board shall
constitute a quorum, but a lesser number may adjourn to a subsequent time.
RULE 156.00
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
156.00 Nominating Committee - Until the first business day of January, 2001,
the Nominating Committee shall consist of seven members: six elected members and
one elected Associate Member whose terms of office shall be three years.
Beginning on the first business day of January, 2001, the Nominating Committee
shall consist of five members: four elected Full Members and one elected
Associate Member whose terms of office shall be three years, except as provided
in the Certificate of Incorporation, Exhibit B., Section 7. The Committee
members shall elect their own Chairman who shall be a Full Member. The Associate
Member shall serve as a full voting member of the Committee. No member of the
Nominating Committee shall be eligible for re-election or reappointment for a
period of three years after his term expires.
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PROXY BALLOT
BOARD OF TRADE OF THE CITY OF CHICAGO, INC. (THE "CBOT")
The undersigned hereby appoints Paul J. Draths, Carol A. Burke and Terrance K.
Livingston, and each of them, Proxies, as that term is defined in Section 4 of
Exhibit A to the CBOT's Amended and Restated Certificate of Incorporation, with
full power of substitution and revocation, acting together or, if only one is
present and voting, then that one, to vote at the Special Meeting of the
Membership, to be held on October 12, 2000 and any adjournments or postponements
thereof, with all of the powers the undersigned would possess if personally
present, as designated herein:
PROPOSITION
FOR [_]
AGAINST [_]
Amend the CBOT Charter, Bylaws and Rules, as indicated in the Ballot Disclosure,
to reduce the size of the Board of Directors and of the Nominating Committee.
This Proxy Ballot, when properly executed, will be voted in the manner directed
herein by the undersigned. If no direction is made, this Proxy Ballot will be
voted "FOR" the Proposition.
____________________________________ ___________________________________
Signature Date
____________________________________
Print Name Here
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY BALLOT PROMPTLY
================================================================================
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EXHIBIT I
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
FIRST: The name of the corporation is Board of Trade of the City of
Chicago, Inc. (hereinafter referred to as the "Corporation").
SECOND: The address of the registered office of the Corporation in
the State of Delaware is 9 East Loockerman Street, in the City of Dover, County
of Kent, Delaware 19901. The name of the registered agent of the Corporation at
such address is National Registered Agents, Inc.
THIRD: The nature of the business or purposes to be conducted or
promoted by the Corporation are:
(a) to maintain a commercial exchange; to promote uniformity in the
customs and usages of merchants; to inculcate principles of justice and equity
in trade; to facilitate the speedy adjustment of business disputes; to acquire
and disseminate valuable commercial and economic information; and, generally, to
secure to its members the benefits of cooperation in the furtherance of their
legitimate pursuits; and
(b) to engage in any other lawful act or activity for which
corporations may be organized under the General Corporation Law of the State of
Delaware (the "DGCL").
FOURTH: The Corporation is not for profit and shall have no authority
to issue capital stock. Any amendment, alteration or repeal of this Article
FOURTH shall require the approval of the Board of Directors and the affirmative
vote of the members in accordance with Exhibit A to this Amended and Restated
Certificate of Incorporation (including all exhibits, the "Certificate of
Incorporation"), which exhibit shall be a part hereof.
FIFTH: The terms and conditions of membership in the Corporation,
including, without limitation, the rights and obligations, including trading
rights and privileges, of members (full, associate or otherwise), member firms,
membership interest holders, delegates and all categories and classes of
memberships and other interests in the Corporation, shall be as provided in or
pursuant to this Certificate of Incorporation, Exhibit A hereto and the bylaws
of the Corporation (including all provisions incorporated therein by reference,
the "Bylaws"). Each person or entity that held any membership or other interest
in the Board of Trade of the City of Chicago, an Illinois not-for-profit
corporation ("Old CBOT"), immediately prior to the merger of Old CBOT with and
into the Corporation (the "Merger"), shall hold such membership or other
interest in the Corporation immediately following the Merger, subject to this
Certificate of Incorporation and the Bylaws, Rules and Regulations (each as
hereinafter defined) of the Corporation.
<PAGE>
This Certificate of Incorporation and the Bylaws may be amended from
time to time to provide for one or more additional classes of members,
membership or other interests, with such terms and conditions, including,
without limitation, rights and obligations, including trading rights and
privileges, voting rights (or no voting rights), and other qualifications and
powers, some or all of which may vary as between classes, as may be provided for
herein or in the Bylaws. Any such amendment to this Certificate of
Incorporation shall require the approval of the Board of Directors and the
affirmative vote of the members in accordance with Exhibit A hereto.
SIXTH: The business and affairs of the Corporation shall be managed
by or under the direction of a governing body to be known as the Board of
Directors. Until the first business day of January, 2001, the Board of
Directors shall be comprised of the following twenty-seven members (all of whom
may be referred to hereinafter as "Directors"):
(a) the Chairman of the Board;
(b) the First Vice Chairman of the Board;
(c) the Second Vice Chairman of the Board;
(d) the President of the Corporation (who shall be a non-voting
Director);
(e) fifteen elected Directors who shall be Full Members of the
Corporation and of whom at least three shall be non-resident (defined for
purposes of this provision as a person whose ordinary place of business or
occupation is located more than fifty miles from the Court House of Cook County,
Illinois);
(e) five non-member Directors; and
(g) three Directors who shall be Associate Members of the
Corporation.
Beginning on the first business day of January, 2001, the Board of Directors
shall be comprised of the following eighteen members (all of whom may be
referred to hereinafter as "Directors"):
(a) the Chairman of the Board;
(b) the Vice Chairman of the Board;
(c) the President of the Corporation (who shall be a non-voting
Director);
(d) nine elected Directors who shall be Full Members of the
Corporation and of whom at least two shall be non-resident
(defined for purposes of this provision as a person whose
ordinary place of business or occupation is located more than
fifty miles from the Court House of Cook County, Illinois);
(e) four non-member Directors; and
(f) two Directors who shall be Associate Members of the Corporation.
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The terms of office of such Directors, the manner of their nomination,
election or appointment, and other terms and conditions of their service shall
be as provided herein and in Exhibit B to this Certificate of Incorporation,
which exhibit shall be a part hereof, and in the Bylaws.
SEVENTH: The Corporation shall have Bylaws, which shall include the
Rules of the Corporation (the "Rules"), relating to the business of the
Corporation, the conduct of its affairs, and its rights or powers or the rights
or powers of its members and other interest holders, Directors, officers,
employees, agents or other persons having dealings with the Corporation. The
Rules shall be set forth in, or incorporated by reference into, the Bylaws and
shall be a part thereof. The Bylaws and the Rules may be adopted, amended or
repealed by the membership in the manner provided in this Certificate of
Incorporation and Exhibit A hereto. The Board of Directors may adopt, amend or
repeal Regulations of the Corporation (the "Regulations") not in conflict with
the Rules, which shall have the binding effect of Rules. By majority vote, the
Board of Directors may delegate, to particular committees as designated by the
Board, the power to adopt, amend or repeal Regulations. Applicants for
membership and any person or entity holding any membership or other interest in
the Corporation shall be required to sign a written agreement to observe and be
bound by this Certificate of Incorporation and the Bylaws, Rules and Regulations
of the Corporation, as each may be amended from time to time.
EIGHTH: Any person or entity holding any membership or other interest
in the Corporation shall hold such membership or interest subject to this
Certificate of Incorporation and the Bylaws, Rules and Regulations of the
Corporation, as each may be amended from time to time, and shall be required to
comply with all requirements hereof and thereof, including, without limitation,
the requirements relating to proceeds of membership set forth in Rule 252.00 (as
the same may be amended from time to time).
NINTH: The Merger of Old CBOT with and into this Corporation shall
have no effect on any rights related to the Chicago Board Options Exchange,
Incorporated, including, without limitation, the rights provided in Rule 210.00
(as the same may be amended from time to time), held by any person or entity
holding any membership or other interest in the Corporation.
TENTH: A Director of the Corporation shall not be personally liable
to the Corporation or its members for monetary damages for breach of fiduciary
duty as a Director, except for liability (i) for any breach of the duty of
loyalty to the Corporation or its members, (ii) for acts or omissions not in
good faith or that involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the DGCL, or (iv) for any transaction from which such
Director derived an improper personal benefit. If the DGCL is amended to
authorize corporate action further eliminating or limiting the personal
liability of directors or members of the governing body of a non-stock
corporation, then the liability of such Director shall be eliminated or limited
to the fullest extent permitted by the DGCL, as so amended. Any repeal or
modification of this provision shall not adversely affect any right or
protection of a Director existing at the time of such repeal or modification.
For purposes of this Article, the term "Director" shall, to the fullest extent
permitted by the DGCL, include any person who, pursuant to this Certificate of
Incorporation, is authorized to exercise or perform any of the powers or duties
otherwise conferred upon a board of directors by the DGCL.
ELEVENTH: The provisions of this Certificate of Incorporation may be
amended, altered or repealed from time to time in accordance with Delaware law,
provided that any such amendment, alteration or repeal must be approved by the
membership in the manner set forth herein and in Exhibit A hereto.
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<PAGE>
EXHIBIT A
MEMBERSHIP
----------
The rights of members and other interest holders in the Corporation
shall be subject to the following provisions:
Section 1. Terms and Conditions of Membership. The terms and
conditions of membership in the Corporation, including, without limitation, the
rights and obligations, including trading rights and privileges, of members
(full, associate or otherwise), member firms, membership interest holders,
delegates and all categories and classes of memberships and other interests in
the Corporation, shall be as provided in the Certificate of Incorporation and
this Exhibit A, and in the Bylaws, Rules and Regulations of the Corporation, as
each may be amended from time to time.
Section 2. Election Procedures. Members shall vote to elect persons
to serve on the Board of Directors and Nominating Committee as follows. The
election of such persons shall be in charge of tellers appointed by the Chairman
of the Board. If the Chairman of the Board appoints as teller a non-member
employee of a member, the member shall require such employee to serve as teller
upon the established terms. All votes shall be cast by secret ballot. No
member shall vote who is not in good standing with the Corporation. Members may
vote by mail in the annual election of Directors (the "Annual Election") in the
manner prescribed in Section 4 of this Exhibit A. The portions of ballots on
which votes are cast for Directors and on which votes are cast for the
Nominating Committee shall be rejected unless such portions are marked for a
full ticket. The tellers shall receive the ballots and place the same in the
ballot box, and shall keep a list of the members voting. After the election,
the tellers shall count the ballots and report to the Chairman of the Board the
names of the persons elected. The ballots shall be preserved for one month,
and, upon request of any interested party, the Board may verify the correctness
of the returns.
Section 3. Vote Necessary. The vote required at the Annual Election
for the choice of elective offices shall be as specified in this Section.
(a) Chairman and Vice Chairman of the Board. A majority of all votes
cast shall be necessary to elect a Chairman of the Board and to elect a Vice
Chairman. If no candidate received a majority vote for Chairman of the Board or
for Vice Chairman at the Annual Election, another ballot shall be taken fifteen
days later; and if again there shall be a failure to elect, a third ballot shall
be taken on the fifteenth following day, when a plurality shall elect.
(b) Directors. A plurality of votes shall elect the Directors who are
required to be Full Members of the Corporation; provided, however, that if none
of the candidates for such offices receiving a plurality of votes is a non-
resident member, the non-resident candidate receiving the largest vote as among
all non-resident candidates shall be elected Director, in lieu of the resident
candidate receiving the lowest winning plurality. A plurality of votes shall
elect the Directors who are required to be Associate Members of the Corporation.
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(c) Other Elective Offices. For all other elective offices, a
plurality of votes shall elect.
Section 4. Voting by Mail. At the Annual Election and at all balloting
on propositions submitted to a vote of the members, members may vote by mail by
delivering a proxy to the Secretary of the Corporation, or any other person or
persons designated by the Board of Directors for these purposes (collectively,
the "Proxy"), in the manner hereafter provided. At least ten days prior to the
balloting, the Proxy shall send to each member (1) a proxy ballot (a "Proxy
Ballot") with which the member can appoint the Proxy as proxy and direct the
Proxy how to vote; and (2) a copy of the proposition(s) on which a vote is to be
taken. Any member who so desires may mark and execute the Proxy Ballot and
deliver or mail it to the Proxy. The Proxy shall deliver all such Proxy Ballots
to the tellers in charge of the balloting, and the tellers shall indicate which
members have submitted Proxy Ballots. The Proxy shall cast one or more ballots
to vote, as proxy, as directed in the Proxy Ballots. No ballots received after
the polls have closed shall be counted.
The latest dated Proxy Ballot of a given member delivered or received
by mail shall be the Proxy Ballot followed by the Proxy with respect to such
member. A member can revoke a Proxy Ballot by voting in person.
Section 5. Amendment of Bylaws. New Bylaws and Rules may be adopted
and existing Bylaws and Rules may be amended or repealed by the membership.
Proposed amendments may be recommended by the Board of Directors and, upon such
recommendation, the Chairman of the Board shall call for a special meeting of
the membership to be held not less than ten days or more than sixty days after
the proposed amendment shall have been posted upon the bulletin board (which
shall not be later than the date Proxy Ballots are sent to each member) and
notice thereof shall have been sent to the members. All votes shall be cast by
Proxy Ballot pursuant to Section 4 of this Exhibit A or otherwise in person or
by proxy. For such proposed amendment to be approved, at least 300 votes must
be cast, with at least a majority of such votes being cast in favor of the
amendment; if less than 300 votes are cast, such proposal shall be resubmitted
to the membership in accordance with the procedures set forth in this Section 5
of this Exhibit A. If twenty-five members or more petition for a special
meeting for the purpose of voting upon any proposed amendment, the Board of
Directors, within thirty days or at the next regular Board of Directors meeting,
whichever is sooner, shall either approve and recommend the proposed amendment
and call for a special meeting to vote upon such amendment, or report to the
petitioners the reason for its disapproval. If, within thirty days after such
disapproval, one hundred members or more petition for a special meeting for the
purpose of voting upon such proposed amendment, a special meeting shall be
called for in accordance with the procedures set forth in this Section 5 of this
Exhibit A as though the proposed amendment had been recommended by the Board of
Directors.
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A petition for a special meeting for the purpose of voting upon an amendment
which in the opinion of the Board of Directors involves the same or
substantially the same subject matter as has been submitted to a vote of the
membership at a special meeting at which at least 300 votes were cast at any
time within the twelve months immediately preceding the receipt of such petition
by the Board of Directors shall require the signatures of at least one hundred
members. The Board of Directors shall within thirty days or at the next regular
Board of Directors meeting, whichever is sooner, either approve and recommend
the proposed amendment and call for a special meeting to vote upon such
amendment, or report to the petitioners the reason for its disapproval. If,
within thirty days after such disapproval, two hundred and fifty members or more
petition for a special meeting for the purpose of voting upon such proposed
amendment, a special meeting shall be called for in like manner as though the
proposed amendment had been recommended by the Board of Directors and, for such
amendment to be approved, at least 300 votes must be cast, with at least two-
thirds of such votes being cast in favor of such amendment.
Every petition for amendment shall be signed and dated by each petitioning
member. It shall be considered an act detrimental to the welfare of the
Corporation for any member to sign a petition for a special meeting for the
purpose of a vote on an amendment despite disapproval of such amendment by the
Board of Directors unless and until the Board of Directors shall actually have
disapproved submission of such amendment.
Section 6. Amendment of Amendment of Bylaws. During the period of
posting of an amendment in accordance with Section 5 of this Exhibit A, such
amendment may be amended at a special meeting held for that purpose if the
amendment to the proposed amendment is approved in a vote of the membership in
which at least 300 votes are cast and at least a majority of such votes are cast
in favor of the amendment to the proposed amendment. If the proposed amendment
is thus amended, the amended amendment shall then be posted for at least ten
days before submission to the membership for vote at a special meeting.
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Section 7. Other Propositions For Vote By Members. Any proposition
which the Board of Directors orders submitted to a vote of the members may be so
submitted in accordance with the provisions of this Section 7 of this Exhibit A,
unless provision for such a submission is specifically provided by some other
provision of the Certificate of Incorporation or Bylaws. Such a proposition may
be an amendment to the Corporation's Certificate of Incorporation, or may be any
other proposition which by law or by the Bylaws or by the Regulations or by
order of the Board of Directors for any other reason is required to be so
submitted to a vote of the members. Any number of propositions not exceeding
five may be submitted concurrently to such a vote of the members.
In submitting any proposition to a vote of the members, the Board of
Directors shall adopt a resolution setting forth such proposition, recommending
its adoption and ordering it to be submitted to a vote at a special meeting of
the members. Thereupon, the Chairman of the Board shall cause such proposition
to be posted upon the bulletin board of the Corporation and shall call for a
special meeting upon the proposition on a day to be fixed by the Chairman of the
Board, which shall not be less than ten days or more than sixty days after the
proposition shall have been posted upon the bulletin board. A notice of the
date and time of such special meeting shall be given by mail to each member at
least ten days in advance of the date upon which such vote is to be taken. Such
notice may be accompanied by a letter from the Chairman of the Board in such
form and with such content as the Board of Directors shall approve. A form of
Proxy Ballot setting forth the proposition(s) to be voted upon and providing an
appropriate space for use by the member in voting "for" or "against" the
proposition shall be supplied to each member.
Any such proposition thus submitted to a vote of the members shall be
deemed adopted if at least 300 votes shall have been cast in the special meeting
and a majority of the votes thus cast shall have been in favor of the adoption
of the proposition.
Section 8. Voting Rights. Each Full Member shall be entitled to one
vote on all matters that are subject to a vote of the general membership. Each
Associate Member shall be entitled to one-sixth (1/6) of one vote on all matters
that are subject to a vote of the general membership. Until surrendered for an
Associate Membership, no one-half (1/2) participations or multiples thereof,
shall have any voting rights. In addition, except as otherwise provided herein,
no other Member or Membership Interest holder (as defined in the Rules) shall
have any voting rights.
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EXHIBIT B
BOARD OF DIRECTORS
------------------
The Board of Directors shall be subject to the provisions set forth
below:
Section 1. Chairman of the Board. The Chairman of the Board shall be
the presiding officer of all membership and Board meetings and shall exercise
such powers and perform such duties as generally appertain to that office.
Subject to the approval of the Board, he may appoint special committees and all
other committees where the method of appointment is not otherwise provided for,
and may temporarily fill any vacancy in any appointive office other than Non-
Member Director.
Section 2. Vice Chairman. The Vice Chairman of the Board ("Vice
Chairman") shall perform the duties of the Chairman of the Board in his absence
or disability. In the absence or disability of the Chairman of the Board and
the Vice Chairman, the Board may choose temporarily an Acting Chairman of the
Board.
Section 3. President. (1) The Board may elect a President of the
Corporation, who shall be a non-member, by the affirmative vote of at least two-
thirds of the full Board; (2) the Board is expressly authorized, by such
affirmative vote, to fix the compensation of such President, to prescribe the
duties to be performed by him and to prescribe a tenure of office which tenure
shall be subject to termination for good cause or otherwise, by a vote of not
less than two-thirds of the full Board; and (3) the Board is expressly
authorized to delegate to the President full power to carry on the day-to-day
activities of the Corporation, reserving to itself in such case the authority to
review the activities of the President and to determine the policies of the
Corporation.
Section 4. President's Duties. (1) The President shall be the Chief
Executive Officer of the Corporation responsible to the Board for the management
and administration of its business affairs; (2) he shall serve as chief liaison
between the Corporation and the public, including federal, state and local
government agencies; (3) he shall be a non-voting Director of the Corporation
and a non-voting member of the Executive Committee and shall be included for
purposes of determining whether a quorum of the Board of Directors or the
Executive Committee is achieved; (4) he shall be an ex officio non-voting member
of all appointed and special committees of the Corporation of which he is not a
regular member; (5) he shall employ such subordinate administrative personnel as
he may determine from time to time are required for the efficient management and
operation of the Corporation, and shall establish the qualifications, duties and
responsibilities of all subordinate administrative personnel; (6) subject to the
approval of the Board, he shall fix the compensation, terms and conditions of
employment of all subordinate administrative personnel, and may terminate the
employment of such personnel; (7) he shall supervise the activities of the
Departments of the Corporation; (8) he shall execute all contracts on behalf of
the Corporation; (9) he shall not engage in any other business during his
incumbency as President, nor shall he trade for his own account or for the
account of others in any commodity which is traded on the Board of Trade of the
City of Chicago; and (10)
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by his acceptance of the office of President, he shall be deemed to have agreed
and he shall have agreed to uphold the Certificate of Incorporation and Bylaws,
and the Rules, Regulations and Interpretations, of the Corporation. The Board
may confer upon the President such other and additional rights and
responsibilities as it may deem warranted; provided, however, that the Board
shall not confer upon the President the power to formulate the policies of the
Corporation or to take disciplinary action, arbitrate disputes or adjust claims
against members except in his capacity as Director upon review of such matters.
Section 5. Tenure of Office.
(a) The Chairman of the Board and the Vice Chairman of the Board shall
hold office for two years. The elected Directors shall hold office for three
years, except as provided in Section 7 of this Exhibit B. In addition, non-
member Directors shall be nominated and appointed pursuant to Section 5(d) of
this Exhibit B. The non-member Director who will begin a new term in the next
succeeding year will be nominated and appointed no sooner than the November
Regular Board meeting and no later than the last business day of the year which
precedes the commencement of the new term. Each non-member Director shall hold
office for four years. All Officers and Directors thus elected or appointed
shall take office on the first business day in January following the Annual
Election and shall hold over in office until their respective successors are
qualified after election or appointment.
(b) If a vacancy occurs in the office of non-member Director, such
vacancy will be filled by a successor nominated and approved pursuant to Section
5(d) of this Exhibit B. The successor non-member Director will take office at
the meeting following approval and shall hold office for the remainder of the
applicable four-year term.
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(c) Beginning with the candidates elected at the First Annual Election
following the adoption of the provisions set forth in Section 5(c) of this
Exhibit B, no member shall be elected by the Members of the Exchange to more
than:
- Three consecutive two-year terms as Chairman of the Board; or
- Three consecutive two-year terms as Vice Chairman of the Board; or
- Two consecutive three-year terms as elected Director.
The foregoing term limits shall apply separately and distinctly to each of the
specified elective offices (i.e. - Chairman of the Board, Vice Chairman of the
Board, and elected Director). A member who has reached a consecutive term limit
in any one of the specified elective offices shall not thereby be ineligible for
election to any other elective office on the Board.
(d) The names of all candidates for the non-member Directors'
positions shall be submitted to the Corporation's Nominating Committee. It will
be the responsibility of the Nominating Committee to review the qualifications
of the candidates and present to the Board of Directors the names of those
candidates which the Committee believes are best qualified to serve on the Board
of Directors. The Board of Directors will elect candidates from among those
submitted by the Nominating Committee which the Board of Directors believes are
best qualified to serve the Membership.
Section 6. Qualifications for Elective Officer.
a) No person shall be a candidate for a non-resident Full Member
Directorship as defined in Article SIXTH of the Certificate of Incorporation
unless that person:
- Has been a Full Member for at least three months immediately
preceding the deadline for petition candidacy as specified in the Bylaws;
- Remains a Full Member thereafter through and including his
election; and
- Has prior experience in the futures industry.
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b) No person shall be a candidate for any other Directorship required
to be filled by a Full Member unless that person is a Full Member at the time of
standing for election and has been a Full Member or Associate Member of the
Exchange for at least one year next preceding his election.
c) No person shall be a candidate for any other elective office
required to be filled by a Full Member who shall not have been a Full Member of
the Exchange for at least one year next preceding his election; nor shall any
person be a candidate for an elective office required to be filled by an
Associate Member who shall not have been an Associate Member of the Exchange for
at least one year next preceding his election.
Section 7. Elective Officers.
a) At the December, 2000 Annual Election and at every second Annual
Election thereafter, the Members of the Exchange shall elect as an officer a
Chairman of the Board.
On the first business day of January, 2001, the office of First Vice
Chairman of the Board shall be retitled and shall become the office of Vice
Chairman of the Board. The term of office previously in effect for the First
Vice Chairmanship of the Board shall become the term of office for the Vice
Chairmanship of the Board. The First Vice Chairman of the Board as of the day
preceding the first business day of January, 2001 shall become the initial
holder of the office of Vice Chairman of the Board. At the December, 2001
Annual Election and at every second Annual Election thereafter, the Members of
the Exchange shall elect as an officer a Vice Chairman of the Board.
At the December, 2001 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation), one Director
who shall be an Associate Member (and who shall not be a non-resident member as
defined in Article SIXTH of the Certificate of Incorporation), one member of the
Nominating Committee who shall be a Full Member, and one member of the
Nominating Committee who shall be an Associate Member.
At the December, 2001 Annual Election the Members of the Exchange also
shall elect, for two-year terms, one Director who shall be a Full Member and a
non-resident as defined in Article SIXTH of the Certificate of Incorporation,
and one member of the Nominating Committee who shall be a Full Member.
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At the December, 2002 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation), one Director
who shall be an Associate Member (and who shall not be a non-resident member as
defined in Article SIXTH of the Certificate of Incorporation), and two members
of the Nominating Committee who shall be Full Members.
At the December, 2002 Annual Election the Members of the Exchange also
shall elect, for one year terms, two Directors who shall be Full Members.
At the December, 2003 Annual Election and at every third Annual Election
thereafter, the Members of the Exchange shall elect the following as officers:
Three Directors who shall be Full Members (including at least one non-resident
as defined in Article SIXTH of the Certificate of Incorporation) and one member
of the Nominating Committee who shall be a Full Member.
All such officers shall be Full Members of the Corporation and shall remain
as such throughout their terms, with the exception of those Directors and
officers required to be Associate Members, who shall be Associate Members of the
Corporation and who shall remain as such throughout their terms except as
provided in paragraph (b). All of the aforesaid officers shall be referred to
as the "elective officers".
(b) An Associate Member Director who has completed at least one and
one-half years of his/her current term of office may continue in that office of
Director for the remainder of that term provided that such Director continuously
remains either an Associate Member of the Corporation or a Full Member of the
Corporation.
Section 8. Eligibility for Elective Office. Individual delegates of
Full or Associate Membership who do not hold in their own name an undelegated
Full or Associate Membership are not eligible to be an elective officer as
defined in Section 7 of this Exhibit B.
Section 9. Eligibility of Member-Delegators. Full and Associate
members shall not be ineligible for elective office or for committee
appointments based on their having delegated their Full or Associate
memberships.
Section 10. Absence. If any Director shall absent himself without an
excuse from six consecutive regular meetings of the Board, his office may be
declared vacant.
Section 11. Vacancies. If a vacancy occurs in any elective office due
to death, resignation or other reason, such vacancy may be filled by a successor
elected by the Board of Directors to serve from the meeting following his
election until the next Annual Election or until his successor is elected and
qualified.
Section 12. Continuation of Old CBOT Board. The persons serving on the
Board of Directors of Old CBOT immediately prior to the Merger of Old CBOT with
and into the Corporation shall, at the effective time thereof, become the
directors of this Corporation and shall serve, in such capacity, for the term
and tenure they were serving on the Board of Directors
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of Old CBOT and in accordance with this Exhibit B. As applicable, all references
in this Exhibit B and elsewhere in the Certificate of Incorporation to dates,
actions, terms, tenures or other time periods relating to service on the Board
of Directors of the Corporation and other matters shall be deemed to correspond
to such dates, actions, times, tenures or other time periods applicable to Old
CBOT immediately prior to the Merger.
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EXHIBIT II
AMENDED AND RESTATED
BYLAWS
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
ARTICLE II, Section 4. Nominations and Annual Election.
Each year by no later than the first Wednesday in November, the
Nominating Committee shall hold at least three meetings, of which due notice
shall be posted on the bulletin board. All members may attend such meetings and
suggest nominees for the offices to be filled at the following election. In
selecting candidates, the Committee shall give special consideration to the
desirability of having all interests of the Corporation represented on the
Board. At least one candidate for Director at each applicable Annual Election
must be a non-resident Full Member as defined in Article SIXTH of the
Certificate of Incorporation.
ARTICLE III, Section 2. Quorum. Ten members of the Board shall constitute a
quorum, but a lesser number may adjourn to a subsequent time.
RULE 156.00
OF
BOARD OF TRADE OF THE CITY OF CHICAGO, INC.
156.00 Nominating Committee - Until the first business day of January, 2001,
the Nominating Committee shall consist of seven members: six elected members and
one elected Associate Member whose terms of office shall be three years.
Beginning on the first business day of January, 2001, the Nominating Committee
shall consist of five members: four elected Full members and one elected
Associate Member whose terms of office shall be three years, except as provided
in the Certificate of Incorporation, Exhibit B., Section 7. The Committee
members shall elect their own Chairman who shall be a Full Member. The Associate
Member shall serve as a full voting member of the Committee. No member of the
Nominating Committee shall be eligible for re-election or reappointment for a
period of three years after his term expires.
* * * *
