BOARD OF TRADE OF THE CITY OF CHICAGO, 425, 2000-07-05

BOARD OF TRADE OF THE CITY OF CHICAGO
425, 2000-07-05

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<PAGE>

Filed by Board of Trade of the City of Chicago (CBOT)
Subject Company - Board of Trade of the City of Chicago
Pursuant to Rule 425 under the Securities Act of 1933
File No. 132-01854

* * * *

The following information is available on the Internet.

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CBOT Restructuring Update

CBOT Files Suit Over Exercise Rights

CBOT Membership Overwhelmingly Approves Historic Step In Restructuring
Initiative With Nearly 91% Favorable Vote

CBOT May Volume at 23,221,303 Contracts

Agency Futures: Contract specs., bulletins, notices, research, FAQs and more.

CBOT European Research Symposium
October 27-28, 2000, Glasgow, Scotland --
Call for Papers

Call for Papers

E-openoutcry, a new order routing option for member firms

6% Coupon Change:
. CBOT Treasury Futures
. CBOT(RM) Bond Buyer(TM) Contract

Information on Project A: Contract specs., bulletins, trading hours, trading
access, FAQs

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.
<PAGE>

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Chicago Board of Trade News & Views
--------------------------------------------------------------------------------

News & Views

Want to find out what's going on at the CBOT? In the Futures industry? Check
this section for the latest headlines and more.

Headlines
. CBOT Files Suit Over Exercise Rights

. CBOT, CME Respond to Commodity Exchange Act Legislation Introduced
by Ewing

. Brennan Testifies in Chicago on Regulatory Reform

. Dennis Dutterer Named Interim President and CEO of the Chicago
Board of Trade

. 2000 Press Releases

. 1999 Press Releases

. CBOT/MidAm Seat Prices

. CBOT Lease Price Ranges

. Your View

. Regulatory Information
<PAGE>

[Press Releases Screen]

[This screen may be accessed by clicking the "2000 Press Releases" button on the
News & Views Screen.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------

Press Releases

June 2000

June 30 CBOT FILES SUIT OVER EXERCISE RIGHTS

June 28 CBOT MEMBERSHIP OVERWHELMINGLY APPROVES HISTORIC STEP IN RESTRUCTURING
INITIATIVE WITH NEARLY 91% FAVORABLE VOTE

June 28 DATE SET FOR ALLIANCE TRADING SIMULATION TO START

June 16 HOLIDAY SCHEDULE FOR INDEPENDENCE DAY

June 16 MIDAM MAY VOLUME UP 1.3% AT 196,747 CONTRACTS

June 2 CBOT'S MAY VOLUME AT 23,221,303 CONTRACTS

May 2000

May 25 CBOT, CME RESPOND TO COMMODITY EXCHANGE ACT LEGISLATION INTRODUCED BY
EWING

May 17 CBOT INCREASES AGRICULTURAL DAILY PRICE LIMITS TO ENHANCE MARKET
OPPORTUNITY AND INCREASE EFFICIENCY

May 10 CBOT MARKETS: RESPONDING TO A CHANGING TREASURY MARKET

May 3 DENNIS DUTTERER NAMED INTERIM PRESIDENT AND CEO OF CHICAGO BOARD OF
TRADE

May 2 CBOT MEMBERS TRADED 19,155,133 CONTRACTS IN APRIL WITH AGRICULTURAL
VOLUME UP 9.1% YEAR-TO-DATE

April 2000

April 26 CBOT 10-YEAR AGENCY CONTRACTS HIT CRITICAL MILESTONE--20,000 DAILY
OPEN INTEREST LEVEL FIFTEEN DAYS IN A ROW

April 19 CBOT FED FUNDS CONTINUE TO BREAK RECORD OPEN INTEREST LEVELS--VOLUME
UP 122.9% YTD

April 18 DENNIS DUTTERER NAMED INTERIM PRESIDENT AND CEO OF CHICAGO BOARD OF
TRADE

April 14 DONOVAN RESIGNS FROM CHICAGO BOARD OF TRADE

April 5 CBOT 10-YEAR AGENCY CONTRACTS SURPASS KEY OPEN INTEREST MILESTONE
<PAGE>
April CBOT/MIDAM GOOD FRIDAY HOLIDAY TRADING SCHEDULE
4

April CBOT'S MARCH VOLUME AT 20,518,778 CONTRACTS
4

March 2000

March CBOT SETS VOLUME RECORD FOR 10-YEAR AGENCY CONTRACTS, ANNOUNCES
30 5-YEAR AGENCY PRODUCTS TO LAUNCH MAY 3

March CBOT/EPA HOST EIGHTH ANNUAL SO2 EMISSION ALLOWANCE AUCTION;
29 CBOT POSITIONED AS ENVIRONMENTAL EXCHANGE FOR THE NEXT GENERATION

March CBOT AGENCY CONTRACTS GENERATE STRONG AND STEADY GROWTH
23

March CBOT LAUNCHES 10-YEAR AGENCY NOTE CONTRACTS
15

March CBOT TO LAUNCH 10-YEAR AGENCY NOTE CONTRACTS MARCH 15
6

March CBOT FEBRUARY VOLUME AT 25,369,025 CONTRACTS, UP 11.2% FROM
2 JANUARY 2000

February 2000

February CBOT ANNOUNCES FOUR OFFICER PROMOTIONS
24

February CBOT CALLS FOR FAIR AND BALANCED REGULATORY TREATMENT
10

February CBOT FED FUNDS CONTRACT SET NEW VOLUME RECORD, YEAR-TO-DATE
3 VOLUME UP 36% FROM LAST YEAR

February CBOT/MIDAM PRESIDENTS DAY TRADING SCHEDULE
3

February CBOT POSTS HIGHEST JANUARY VOLUME EVER AT 22,820,812 CONTRACTS,
2 UP 63.7% FROM DECEMBER 1999

January 2000

January CBOT TO EXPAND PROJECT A TRADING HOURS FOR AGRICULTURAL CONTRACTS
26

January CBOT BOARD APPROVES NEW TEN- AND FIVE-YEAR AGENCY DEBT FUTURES
26 AND OPTIONS CONTRACTS

January CBOT DIRECTORS APPROVE HISTORIC RESTRUCTURING
20

January INTERNET ENTREPRENEUR ANDREW "FLIP" FILIPOWSKI TO SERVE ON CBOT
13 BOARD OF DIRECTORS

January CBOT/MIDAM MARTIN LUTHER KING, JR. HOLIDAY TRADING SCHEDULE
6

January CBOT 1999 VOLUME AT 254,561,215 CONTRACTS
4

<PAGE>

January CBOT MARKETS EXPECTED TO OPEN ON SCHEDULE IN Y2K
2

<PAGE>

[This screen may be accessed by clicking the "CBOT Files Suit Over Exercise
Rights" button on the Press Releases Screen.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------
Press Release

FOR IMMEDIATE RELEASE

David Prosperi
312-435-3456
Katherine Spring
312-475-5987

CBOT FILES SUIT OVER EXERCISE RIGHT

The CBOT complaint seeks a declaration that its move to a Delaware
not-for-profit corporation preserves the Exercise Right

CHICAGO, June 30, 2000-Today, the Board of Trade of the City of Chicago filed a
lawsuit seeking a declaration that the CBOT's reincorporation as a Delaware
not-for-profit corporation would not extinguish the Exercise Right and asking
the Court to prevent the Chicago Board Options Exchange from taking any action
to the contrary. CBOT's reincorporation as a Delaware not-for-profit is known as
Step One of the Board of Trade's restructuring strategy. Step One was
resoundingly approved by over 90% of the CBOT's members in a June 28 vote.

On June 20, 2000, CBOE issued a circular stating that when Step One of CBOT
restructuring is completed CBOT Full Members' CBOE Exercise Right would
"disappear" as a matter of law. Yesterday, the CBOT wrote to the CBOE asking for
a written confirmation that the CBOE's position had changed and that following
CBOT's reincorporation in Delaware CBOE would take no action to jeopardize the
Exercise Right. The CBOE refused to provide that confirmation.

CBOT Chairman David Brennan stated: "I have pledged to our members to do
whatever is needed to preserve the CBOE Exercise Right as an essential element
of our restructuring plan. Since CBOE persists in its unfounded claim that Step
One is inconsistent with the Exercise Right and would otherwise remain free to
act to attempt to encumber or eliminate that legal right at any time, we had no
choice but to act. We look forward to judicial vindication of our position and
to moving forward with our plan to modernize the Board of Trade's business
operations."

Attached are copies of the CBOE's June 29 response, our reply, and our letter to
CBOT members regarding the lawsuit.

<PAGE>

referred to herein or in connection herewith, when it becomes available, as well
as the other documents that the CBOT has filed or will file with the Securities
and Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994,
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 be any sale of securities in
any state in which offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such state. No
offering of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.

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

Chicago Board of Trade Options Exchange 400 South LaSalle Street Chicago,
Illinois 60605 www.cboe.com

Thomas A. Bond Vice Chairman Phone: 312 786-7088 Fax: 312 786-7407 [email protected]

June 29,2000

BY MESSENGER

Mr. David P. Brennan Chairman of the Board Chicago Board of Trade 141 West
Jackson Boulevard Chicago, Illinois 60604

Dear David,

Your letter of today suggests that the Chicago Board of Trade has misunderstood
CBOE Information Circular IC00-64. By no means does the circular imply any
change in CBOE's legal position concerning the effect of CBOT's restructuring on
the exercise right. The purpose of the circular was simply to assure our members
that we do not intend to bar exercisers from the CBOE's trading floor on account
of the reincorporation of CBOT as a Delaware non-stock corporation.

Sincerely, Thomas A. Bond Vice Chairman

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

June 30, 2000

Dear Bill and Tom:

On June 20, 2000, CBOE issued a circular stating that when Step One of our
Restructuring is completed our Full Members' CBOE Exercise Right would
"disappear" as a matter of law. We strongly disagree with CBOE's view. After
receiving your June 29 circular, I wrote to you asking for confirmation that
CBOE's position had changed and that you would take no action to jeopardize the
Exercise Right based on our reincorporation in Delaware. Your letter of June 29
refused to provide that confirmation.

As you know, preserving the Exercise Right is an essential ingredient of our
restructuring plan. Since you have been unwilling to provide us with any
assurance that you will not act

<PAGE>

to attempt to encumber or eliminate the Exercise Right after Step One is
effectuated, we had no choice but to act. After careful deliberation, we have
today filed a complaint in the Circuit Court of Cook County seeking a
declaration that implementation of Step One does not extinguish or impair the
Exercise Right and asking the Court to prevent CBOE from taking any action to
the contrary.

We regret that you have forced us to resolve this dispute in the courts, but by
virtue of your June 29 letter you have given us no alternative. At the same
time, we are willing to continue our negotiations with you on a merger or other
joint business strategies that will strengthen our two great institutions. We
are hopeful that in the coming weeks we can still amicably resolve our
differences.

Sincerely, David P. Brennan

The CBOT urges its members and membership interest holders to read the
Registration Statements on Form S-4, including the proxy statement/prospectus
contained within the Registration Statements, regarding the CBOT restructuring
referred to herein or in connection herewith, when it becomes available, as well
as the other documents that the CBOT has filed or will file with the Securities
and Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994,
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 be any sale of securities in
any state in which offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such state. No
offering of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.

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

June 30, 2000

Dear Fellow Members:

On June 20, 2000, CBOE issued a circular stating that when Step One of our
Restructuring is completed our Full Members' CBOE Exercise Right would
"disappear" as a matter of law. We strongly disagree with CBOE's view.
Yesterday, June 29, CBOE issued a new circular, and in response I wrote to CBOE
asking for confirmation that its position had changed and that after our
reincorporation in Delaware CBOE would take no action to jeopardize the Exercise
Right. CBOE has refused to provide that confirmation. Instead, late yesterday
afternoon they sent me the attached letter, which speaks for itself. My reply to
CBOE's June 29 letter is also attached.

Your Board of Directors and I have pledged to preserve the CBOE Exercise Right
as an essential element of our restructuring strategy. Since CBOE persists in
its unfounded claim that Step One is inconsistent with the Exercise Right and
that it is free to attempt to encumber or eliminate that legal right at any
time, your Board of Directors had no choice but to act. After careful

<PAGE>

deliberation, we have today filed a complaint in Circuit Court of Cook County
seeking a declaration that implementation of Step One does not extinguish the
Exercise Right, and asking the Court to prevent CBOE from taking any action to
the contrary. A copy of the complaint is available in the Legal Department.

We have told CBOE management that we are still willing to engage in
negotiations, and we hope that our two great institutions can still resolve our
differences amicably. At the same time, we remain committed to preserving the
Exercise Right as we move forward with our restructuring initiative.

Sincerely, David P. Brennan

Email: [email protected] Hotline: 847-326-0926 Phone: 312-347-5102
Fax: 312-341-5810 Mail: CBOT Restructuring 4015 Board of Trade Building
Chicago, Ill. 60604

<PAGE>

[This screen may be accessed by clicking the "CBOT Membership Overwhelmingly
Approves Historic Step in Restructuring Initiative with Nearly 91% Favorable
Vote" button on the Press Release Screen.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------

Press Release

FOR IMMEDIATE RELEASE
David Prosperi
312-435-3456
Katherine Spring
312-475-5987

CBOT MEMBERSHIP OVERWHELMINGLY APPROVES HISTORIC STEP IN RESTRUCTURING
INITIATIVE WITH NEARLY 91% FAVORABLE VOTE

Exchange moves toward implementation of remaining steps of restructuring
strategy

CHICAGO, June 28, 2000--Chicago Board of Trade members today overwhelmingly
voted in favor of implementation of the initial step of the Exchange's strategy
to restructure as a for-profit, demutualized organization, with 90.7% of the
votes cast in support. This initial step will allow the CBOT to reincorporate as
a Delaware non-stock, not-for-profit corporation, which will serve to facilitate
the CBOT's future restructuring efforts.

CBOT Chairman David Brennan said, "I applaud the CBOT membership for embracing
change and coming together in support of this historic initiative. CBOT members
have once again demonstrated their commitment to this institution, its future
and its legacy. This is a tremendous vote of confidence in the direction our
exchange is headed. By reincorporating in Delaware, which will provide us
greater flexibility, and modernizing our corporate governance structure, we can
take control of our destiny and emerge as the industry's most nimble, proactive
and dynamic futures exchange."

Interim President & CEO Dennis Dutterer said, "This is the dawn of a new era for
the CBOT. It is with great confidence that our management team will continue to
work closely with the Board of Directors and the Implementation Committee to
develop the remaining terms of the overall restructuring."

Re-incorporation efforts are being initiated. Reincorporating in Delaware is
considered a key step in any CBOT's restructuring plan the CBOT may implement.
The CBOT Board of Directors approved the Exchange's overall restructuring
strategy on January 19, 2000. Once the remaining terms of the overall
restructuring have been developed, a second membership vote will be conducted at
a later date.

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within

<PAGE>

the Registration Statements, regarding the CBOT restructuring referred to herein
or in connection herewith, when it becomes available, as well as the other
documents that the CBOT has filed with or will file with the Securities and
Exchange Commission, 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 web site at www.sec.gov, or from the CBOT by
directing such

<PAGE>

[This screen may be accessed by clicking the "CBOT Directors Approve Historic
Restructuring" button on the Press Releases Screen.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------

Press Release

For Immediate Release
Richard Myers
312/435-3621
[email protected]

CBOT DIRECTORS APPROVE HISTORIC RESTRUCTURING

Chicago, January 20, 2000 - Continuing its tradition as the industry standard
bearer, the Board of Directors of the Chicago Board of Trade yesterday
overwhelmingly approved a plan to restructure the exchange.

The restructuring recommendation calls for the demutualization of the CBOT with
current members becoming shareholders in two new companies.

The first company will retain the open outcry platform of trading and will be a
closely held, for-profit company. The for-profit status will allow for improved
decision-making and a more economically viable business that can take advantage
of trading volumes that thrive in the open outcry environment.

The second company will establish an electronic trading capability. This company
is expected to trade all current CBOT contracts, plus additional products, in an
open access environment. It is expected that equity interests in this new
company will be distributed to CBOT members, potentially followed by an initial
public offering. No offering of securities will be made in connection with any
of the foregoing transactions except by means of a prospectus.

In a letter to CBOT members distributed earlier today, CBOT Chairman David P.
Brennan said, "This is an historic time for the Chicago Board of Trade. The CBOT
has built its leadership position by being highly responsive to customers and
having superior management. This restructuring is another ground-breaking step
in continuing the Board of Trade's tradition of industry leadership in the
increasingly global and technologically advanced marketplace."

The restructuring initiative is subject to membership approvals.

For additional information, see Chairman Brennan's letter to the membership.
<PAGE>

[This screen may be accessed by clicking the "letter" link in the Press Release
entitled, "CBOT Directors Approve Historic Restructuring.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------

January 20, 2000

Dear Fellow Members:

Yesterday, the Board of Directors of the Chicago Board of Trade overwhelmingly
approved a recommendation of the Restructuring Task Force that will preserve the
traditional open outcry platform of trading, while moving the CBOT fully into
the electronic marketplace. In this brief letter, I wanted to provide you with
an overview of the strategic restructuring proposal that was approved.

As you recall, a task force of directors and members, working closely with
senior managers and outside advisors, has been studying restructuring
alternatives since last summer. We have worked very hard to develop a plan that
answers customer, member, management and staff needs and desires. The CBOT must
change if we are going to thrive in an increasingly competitive environment.
This restructuring plan is the 'best of all worlds' because it will help us to
better serve the trading community, while providing a more stable financial
future for our members and customers.

The restructuring recommendation calls for demutualization of the CBOT with
current members becoming shareholders in two new companies. The first company
will retain the open outcry platform of trading and will be a closely-held,
for-profit company. The for-profit status will allow for improved
decision-making and a more economically viable business that can take advantage
of trading volumes that thrive in the open outcry environment.

The second company will establish an electronic trading capability currently
unmatched by other exchanges. This company is expected to trade all current CBOT
contracts, plus additional products, in an open access environment. It is
expected that equity interests in this new company will be distributed to the
CBOT members, potentially followed by an initial public offering. No offering of
securities will be made in connection with any of the foregoing transactions
except by means of a prospectus.

A separate electronic trading company will allow us to pursue growth
opportunities aggressively, as well as seek more strategic alliances and
partnerships to capture additional order flow, expand distribution and provide
increased access to capital and technology. In fact, potential strategic
investors already have expressed an interest in this exciting new venture.
<PAGE>

The Board of Directors has created an Implementation Committee of directors to
oversee the restructuring plan and prepare the membership ballot materials. The
Board also has created a committee consisting solely of independent directors to
recommend an allocation of value among the members of the CBOT.

The members will vote to approve the initial steps in the restructuring plan
promptly after the preparation of the appropriate legal documentation, and a
second vote of the membership to approve the final details of the plan will be
required before the plan will be fully implemented later in the year. The
initial steps of the restructuring would commence immediately after the first
approval. It is anticipated that members will take the second vote in the fourth
quarter to approve the final restructuring steps, the conversion of the CBOT
into a for-profit corporation and the spin-off of the electronic trading
company.

You should understand that there are many details to be determined and tax and
other regulatory approvals to be obtained. We will be working to resolve these
issues. Members will receive more information through floor meetings and other
presentations prior to the vote.

This is an historic time for the Chicago Board of Trade. The CBOT has built its
leadership position by being highly responsive to customers and having superior
management. This restructuring is another ground-breaking step in continuing the
Board of Trade's tradition of industry leadership in the increasingly global and
technologically advanced marketplace. I look forward to talking with you about
these developments.

Sincerely,

David P. Brennan

<PAGE>

[Restructuring Screen]

[This screen may be accessed by clicking the "CBOT Restructuring Update"
Button on the Home Page Screen]

CBOT-Restructuring Overview

Chicago Board of Trade News & View

CBOT Restructuring Plan

Plan Summary

. Detailed Restructuring Report (05-23-2000)

CBOT Members Q&A

. Restructuring Questions-Answers (5-23-2000)

News & Updates

. CBOT Files Suit Over Exercise Rights (06-30-2000)
. Brennan Letter Informs Members Step One Ballot Mailed for June 2
Congratulatory Letter From Mayor Daley Attached (06-05-2000)
. Text of Remarks by Chairman Brennan at May 25, 2000 CBOT Floor Meeting
(05-30-00)
. Letter From Brennan: Board Approves Step One of Restructuring (05-17-00)

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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, a documents filed by the CBOT
at the Commissions web site 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,
141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.
<PAGE>

[This document may be accessed by clicking the "Detailed Restructuring Report"
button on the Restructuring Screen.]

Restructuring Report of the Chicago Board of Trade

May 16, 2000
<PAGE>

RESTRUCTURING REPORT
OF THE
CHICAGO BOARD OF TRADE

TABLE OF CONTENTS
-----------------

<TABLE>
<CAPTION>
Page
----
<S> <C>
SUMMARY....................................................................................... 1
BACKGROUND AND INTRODUCTION................................................................... 5
THE RESTRUCTURING PLAN........................................................................ 10
ONGOING RELATIONSHIPS BETWEEN FOR-PROFIT CBOT AND THE ELECTRONIC TRADING COMPANY.............. 14
FINANCING..................................................................................... 16
FEES.......................................................................................... 18
CLEARING...................................................................................... 18
RESTRUCTURING IMPLEMENTATION.................................................................. 19
WHAT MEMBERS WILL RECEIVE..................................................................... 23
TRANSFER OF EQUITY INTERESTS.................................................................. 27
TRADING RIGHTS................................................................................ 28
CORPORATE GOVERNANCE AND MANAGEMENT........................................................... 31
COMPETITION................................................................................... 34
COMPARISON OF RIGHTS OF MEMBERS OF THE CBOT AND MEMBERS OF THE REORGANIZED
DELAWARE NFP CBOT.......................................................................... 35
THE MEETINGS OF MEMBERS....................................................................... 50
SECURITIES LAW ISSUES......................................................................... 54
TAX CONSIDERATIONS............................................................................ 54
CFTC REGULATORY MATTERS....................................................................... 54
CONCLUSION.................................................................................... 56
</TABLE>

i
<PAGE>

RESTRUCTURING REPORT
OF THE
CHICAGO BOARD OF TRADE

SUMMARY

The derivatives industry has undergone significant changes over the last several
years. Electronic trading has emerged as the dominant mode of trading in the
European and Asian exchanges and has experienced continued growth in the United
States. Demutualization of exchanges is also sweeping through the country as
the New York Stock Exchange ("NYSE") and the Nasdaq Stock Market ("NASDAQ") have
announced plans to demutualize, and the Chicago Mercantile Exchange ("CME") has
begun to implement its reorganization and demutualization plan. Much of this
change is being fueled by the advance of technology and the increased customer
demand for cost-efficient, effectively run exchanges.

The Chicago Board of Trade ("CBOT") is being tremendously challenged by these
changes. As a leader in the derivatives markets, the membership as well as the
industry is looking to the CBOT to define the role of the exchange in the
financial markets of the future. One step in this process was the CBOT's
alliance with Eurex, the world's largest electronic exchange. The next step is
the adoption and implementation of a restructuring plan that is intended to
position the CBOT as the leading marketplace of the 21/st/ century.

The process of developing the restructuring plan was initially led by the
Restructuring Task Force and subsequently undertaken by the Implementation
Committee, each with assistance from outside legal, financial, tax, accounting
and other advisors. A number of restructuring alternatives were evaluated by the
Restructuring Task Force in order to devise the best plan for all stakeholders
involved. Highlights of the currently contemplated restructuring plan as
currently enumerated in this report by the Implementation Committee and adopted
by the CBOT's Board of Directors ("Board") include:

. Moving the CBOT to a for-profit Delaware corporate structure, focused
on updated open outcry trading with enhanced technology ("For-Profit
CBOT");

. Allocating shares of stock representing both trading rights and equity
ownership in For-Profit CBOT to the members;

. Adopting a streamlined management governance structure at the CBOT
with a smaller Board of Directors and a more efficient decision making
process that would enhance the CBOT's ability to respond to the
rapidly evolving marketplace;

. Reorganizing CBOT's electronic trading business, part of which is now
operated by the Ceres Trading Limited Partnership ("Ceres"), as a for-
profit company focused on electronic trading;

. Allocating shares of stock in the electronic trading company to the
members;
<PAGE>

. Unlocking value in current membership interests in the CBOT through a
potential initial public offering of the stock of the electronic
trading company;

. Attracting capital for the electronic trading company and potentially
the For-Profit CBOT;

. Attempting to restructure the CBOT's liabilities;

. Executing a three-year non-compete and cooperative agreement with the
electronic trading company during which time For-Profit CBOT cannot
operate an electronic trading system within its corporate structure,
except for a small order retail execution-type system; and

. Establishing exchange fees for CBOT members and their lessees at the
reorganized electronic trading company that are no higher than those
charged to anyone else for the term of the three-year non-compete and
cooperative agreement.

We believe that restructuring is essential for many reasons. Without it, the
CBOT may not be able to preserve a viable open outcry exchange capable of
competing in the future and at the same time capture the growth of electronic
trading. Restructuring is the best way to unlock and maximize the value of CBOT
membership. It also enables the CBOT to adopt a business model that will allow
it to make the decisive moves required to address competitive challenges, build
advantageous strategic alliances and lower costs.

The mechanics of this transaction will take place in various independent steps,
each dependent upon membership approval. The first step involves the
reincorporation of the CBOT as a Delaware nonstock, not-for-profit company
("Delaware NFP CBOT"). Subsequent to this reincorporation, the CBOT will
reorganize and activate the electronic trading company as a wholly owned,
independently managed subsidiary of Delaware NFP CBOT.

Subsequent restructuring steps call for the conversion of Delaware NFP CBOT into
a Delaware for-profit corporation ("For-Profit CBOT") and for the reorganized
electronic company to operate independently of For-Profit CBOT. The State of
Delaware has a more developed, modern and flexible body of corporate law than
the Illinois law currently applicable to the CBOT. Unlike the law of Illinois
to which the CBOT is currently subject, the corporate law of Delaware would
permit Delaware NFP CBOT to elect to become a for-profit corporation while also
providing flexibility to engage in mergers or other business combinations that
might be pursued.

As part of the overall restructuring, CBOT members would receive an allocation
of shares of stock in For-Profit CBOT and shares of stock in the electronic
trading company. Following this allocation, it is currently expected that the
electronic trading company would bring an initial public offering to market. The
various subsequent steps may be taken together upon approval in a single member
vote or may occur independently of each other pursuant to separate membership
approvals.

<PAGE>

The purpose of the first member vote is only to approve certain legal steps
required to implement the first step of the restructuring. Specifically, as
described more fully in the ballot and herein, you will be voting to approve the
election by the CBOT to accept the Illinois General Not for Profit Corporation
Act of 1986, as amended (the "NFP Act"), that will provide the statutory
authority to accomplish the first step of the restructuring, and a related
technical amendment to the CBOT's special charter necessary to effect such
election. In addition, you will be voting to approve the reincorporation merger
of the CBOT with and into Delaware NFP CBOT, with Delaware NFP CBOT as the
surviving corporation. In connection with the first member vote, we are
providing you with further information relating to the overall restructuring
strategy.

The first step of the restructuring would be implemented as soon as practicable
following approval by the members in the first member vote as described herein.
The subsequent steps of the restructuring would be implemented as soon as
practicable following the subsequent membership approvals, subject to receiving
required regulatory approvals from the Commodity Futures Trading Commission
("CFTC"), the Securities and Exchange Commission ("SEC") and the Internal
Revenue Service ("IRS"). In particular, certain aspects of the membership
approvals must be solicited pursuant to a proxy statement/prospectus
constituting part of a registration statement filed with and declared effective
by the SEC. Proxy statements/prospectuses are anticipated to be submitted to you
later this year and the subsequent member vote will be held at least 20 business
days after the applicable proxy statement/prospectus has been mailed.

Although the restructuring strategy, as presented herein, contemplates that step
one and the subsequent steps of the restructuring are parts of an integrated
plan to restructure the CBOT, it is important to note that step one is
completely independent of the subsequent steps and step one may, if approved by
the membership, be implemented even if the subsequent steps are not brought to a
vote by the membership, or brought to a vote by the membership but not approved.
The first step of the restructuring plan contemplates certain material changes
to the legal status, organization and operation of the CBOT, which may be
irreversible. These changes and other changes described herein as part of step
one of the restructuring would be implemented as soon as practicable following
approval by the membership in the first member vote. It is important for you,
therefore, to read the ballot disclosure materials and this report carefully
before you make your decision regarding whether you wish to vote to approve step
one of the restructuring.

As part of the overall restructuring strategy, members would share ownership in
both the restructured For-Profit CBOT and the electronic trading company. After
completion of all of the contemplated restructuring transactions, the open
outcry company would be a Delaware for-profit corporation. The memberships in
the CBOT would become memberships in For-Profit CBOT represented by two classes
of stock, one of which would be equity bundled with trading rights designed to
replicate the trading rights of the current CBOT members, and the other of which
would represent equity only. All holders of current CBOT membership interests
will receive shares of stock designed to replicate the trading rights they
currently possess. For example, CBOT Full Members will receive shares with
rights ensuring that they will continue to possess full trading rights and
privileges to trade as principal and broker in all contracts traded on the CBOT.

<PAGE>

As a for-profit corporation, the open outcry company may be able to utilize the
pure equity class of stock to raise additional capital or to attract strategic
investors. In addition, the members of the CBOT would receive equity in the
reorganized, for-profit electronic trading company.

If the subsequent steps are not brought to a vote by the membership, however, or
if brought to a vote by the membership and not approved, then, provided no
further action is taken by the CBOT, the CBOT would remain a Delaware not-for-
profit company and would not become a for-profit corporation, nor would it be
likely that the electronic company would conduct an initial public offering.

This strategy has been designed to provide the CBOT and the reorganized
electronic trading company with significant competitive advantages. We believe
that the for-profit open outcry corporation would allow members to continue to
benefit from existing operations. The For-Profit CBOT would be, and likely
remain, closely held and, to the extent permissible under applicable law, guided
by the current membership with excess cash flows directed back into the
organization to make investments, reduce costs and provide enhanced member
trading opportunity.

We believe that the electronic trading company would provide current members
with the opportunity to benefit from the growth in this sector. This company
would be focused on rapid growth, increased access for the global trading
community, high earnings and the potential for becoming a publicly traded
entity.

The Board is presenting this report on the restructuring plan to you because it
believes it is the single alternative that most effectively positions the CBOT
to remain the center of liquidity, preserves open outcry, enhances governance,
maximizes value and creates an exciting, formidable electronic trading company.

This report has been provided to you for informational purposes only and, with
respect to the description of the subsequent steps of the restructuring, may not
be relied upon in reaching your decision to approve step one of the
restructuring strategy. In the event of changes to the significant factors
underlying the development of the subsequent steps of the restructuring, as
currently contemplated, the form and structure of such subsequent restructuring
steps may be revised. The description of the subsequent steps of the
restructuring, therefore, may be superseded and replaced by subsequent materials
distributed or disclosed to you in connection with a subsequent member approval
or otherwise and the descriptions contained herein, in such event, may have no
further effect or validity.
<PAGE>

BACKGROUND AND INTRODUCTION

History of Development of Plan

The CBOT was organized in 1848 as a voluntary, unincorporated association to
serve as an open outcry marketplace for the growing agricultural derivatives
market. In 1859, the Illinois General Assembly by legislative act granted the
CBOT a special charter that incorporated the CBOT. Although the CBOT's special
charter does not specifically state that the CBOT is a not-for-profit
corporation, Illinois courts have consistently assumed that the CBOT was formed
as a not-for-profit corporation and is therefore subject to the Illinois Special
Charter Not For Profit Corporations Act, as amended (the "Special Charter Act").

In its 152/nd/ year of operation, the CBOT is a leader in the domestic U.S.
listed derivatives market with more than a 40% market share and continues to be
one of the world's foremost derivatives exchanges with an 18% share of the
global listed derivatives market. The CBOT has one of the strongest brand names
in the derivatives markets.

The CBOT enjoys a significant leadership position in the market. However,
ensuring its success is becoming increasingly challenging in the face of the
rapid changes in the derivatives industry driven by innovations in the computer
and communications industries. Pressure from these innovations is already
beginning to impact the CBOT. Competitors are developing more efficient
electronic marketplaces with greater access.

To meet the growing electronic trading challenges and opportunities, the CBOT
undertook the Project A technology initiative and began an alliance with Eurex
in 1999. Currently, Ceres and CBOT are jointly investing in the Eurex platform
with Eurex. In fact, CBOT and Eurex are in final discussions as to their
arrangements for the operation of the Eurex system. While these initiatives are
appropriately directed, they do not go far enough in positioning CBOT to remain
competitive in the rapidly changing electronic business world.

In early 1999, the CBOT Strategy Committee concluded that changes to the CBOT's
current structure were necessary in order to address its competitive challenges.
This recommendation was included in the strategic plan approved by the Board in
August 1999. The Board of the CBOT established a Restructuring Task Force
charged with developing a restructuring plan to modernize the CBOT's structure
and governance and position it to compete in the evolving marketplace. The Task
Force conducted an extensive strategic evaluation process over approximately six
months aided by the staff of the CBOT, A.T. Kearney, a management consulting
firm, Merrill Lynch & Co., an investment banking firm, Piper Marbury Rudnick &
Wolfe, as special counsel to the Task Force, and Kirkland & Ellis, as counsel to
the CBOT and the Board.

The process of developing the restructuring plan began with an extensive
assessment of current industry trends and best practices. Based upon this
assessment, the Task Force developed objectives for a restructuring plan and a
detailed business outline, including restructuring alternatives, for both an
open outcry market and an electronic trading network.
<PAGE>

In January 2000, the Task Force presented its recommendations to the full Board,
which approved the recommendation with respect to the restructuring strategy and
appointed an Implementation Committee to further refine the details of the plan.
In addition, an Independent Allocation Committee, currently comprised of four of
the outside directors of the Board, was appointed to develop a recommendation to
the CBOT Board with respect to an appropriate and fair allocation of value among
CBOT members in connection with the restructuring, including the allocation of
shares in the two new companies.

Assessment of Industry Trends

Current industry dynamics threaten the long-term viability of traditional open
outcry exchanges. In fact, in 1999, the all-electronic Eurex exchange overtook
the CBOT to become the world's most active derivatives exchange. These dynamics
are being driven, in large part, by shifting priorities of investors and members
of the exchanges, rapid advances in technology and electronic trading and
realignment of key industry players.

Shifting Priorities of Investors and Members

Institutional investors are demanding liquidity, low cost, efficient trade
execution and a sophisticated supporting infrastructure. In turn, members are
under increasing pressure from clients and new entrants in the marketplace, and
want to preserve the value of their memberships. There is tremendous pressure to
reduce costs across the industry. To meet this demand, global financial
institutions are increasingly matching internal customer orders, thereby serving
as their own de facto exchanges. Additional pressure is placed on the industry
by the over-the-counter ("OTC") derivatives market, which is estimated to have
grown to over $80 trillion in notional amount. OTC derivatives are also growing
faster than traditional exchanges. The emerging competing markets are generally
lower cost, more accessible, very focused, afford faster execution and are
increasing their liquidity. These pressures are forcing traditional open outcry
exchanges, such as the CBOT, to modernize in order to remain competitive.

The CBOT recently has faced operational and financial challenges. The current
corporate governance structure is oriented toward supporting individual member
opportunities often at the expense of the membership as a whole. The current
structure has also made it difficult to make necessary decisions expeditiously
regarding technology investments, operational efficiencies, trading practices
and incentives.

A new, streamlined business structure that can compete effectively with other
open outcry markets, electronic exchanges, electronic communication networks
(ECNs) and other alternative trading platforms is necessary for survival. Such a
structure would entail significant changes to the CBOT's corporate governance,
management accountability, staffing levels, membership services and member
benefits.

Advances in Technology and Electronic Trading

Technological innovations are creating new competitors and encouraging the rapid
development of electronic trading systems that challenge the traditional model
of the centralized physical
<PAGE>

auction market. Since the mid-1990s, open outcry volume traded on derivatives
exchanges has declined by over 8%, and electronic trading has grown by more than
24%. Based on industry trends outside the United States, electronic trading is
expected to account for virtually all overseas trading in the near future.

Many leading exchanges are already fully electronic and many other leading
exchanges are aggressively pursuing an electronic model. Even major securities
exchanges such as the NYSE and Nasdaq are under pressure from ECNs.
Approximately one dozen ECNs have been established in the United States, many in
the last two years, by leading investment banks, broker-dealers and market
markers, which are aligning themselves with multiple alternative platforms. For
example, Goldman Sachs has an investment in five ECNs. ECNs have already
captured one-third of Nasdaq's volume.

The CBOT is under pressure from many potential electronic competitors.
Cantor/eSpeed has introduced an electronic trading platform for cash bonds, U.S.
Treasury futures and block OTC derivatives trades for large OTC derivatives
dealers. BrokerTec, backed by nine of the largest U.S. and European investment
banks, plans to provide electronic, inter-dealer brokerage for U.S. Treasuries,
Euro-denominated sovereign debt and an electronic exchange platform for futures
and other derivatives. BrokerTec's key shareholders provide almost one-third of
all of CBOT's fees and order flow.

In addition, on-line auction markets and other e-commerce companies continue to
seek to enter and develop new markets and could create a very serious
competitive threat to the traditional derivatives marketplace.

Industry Realignment

Many exchanges that have restructured in response to industry pressures have
demutualized and have become for-profit entities. Through demutualization,
exchanges are streamlining their corporate governance mechanism, quickening
decision-making, improving access to capital and technology, and enhancing their
ability to quickly enter into strategic alliances. The CME and the New York
Mercantile Exchange (NYMEX) are currently pursuing demutualization plans. Some
exchanges are considering IPOs to raise capital necessary for strategic
endeavors. The ASX and OM (Sweden) are already publicly-held corporations. The
NYSE, Nasdaq and SFE are currently considering IPOs.

In addition to demutualization, the industry is consolidating via mergers and
alliances of exchanges in order to achieve the economies of scale necessary to
remain competitive in a rapidly changing marketplace. Potential competitors and
strategic partners have expressed interest in joining the CBOT in a new
electronic trading venture. These opportunities offer the prospect of sharing
risk, obtaining seed capital and gaining access to order flow that will enhance
the establishment of a viable electronic marketplace.
<PAGE>

Objectives of Restructuring

The CBOT must be restructured in response to the changing marketplace in order
to meet two principal objectives. First, the CBOT must respond to the
technological innovations currently shaping the derivatives market. Second, the
current governance structure of the CBOT, slow to respond and oriented towards
supporting member opportunity, must adopt a more streamlined decision-making
process, focused on maximizing value to the enterprise.

With these two objectives in mind, the Restructuring Task Force evaluated a
number of restructuring alternatives. The Restructuring Task Force determined
that any new structure would incorporate both an updated open outcry exchange,
in response to member demand, and an electronic marketplace, in response to
competitive pressures.

Strategic Alternatives Considered for the Future of the CBOT

The Restructuring Task Force considered three principal structural alternatives
as well as the associated business, corporate, securities, tax and regulatory
issues. Each alternative incorporated a variation of the corporate structure and
equity ownership of the entities. The structures considered were:

. Maintaining the CBOT as a parent and creating a new separate
electronic trading subsidiary;

. Organizing a single demutualized holding company with an open outcry
subsidiary and an electronic trading subsidiary; and

. Reorganizing the CBOT as a for-profit company focused on open outcry
trading and also reorganizing the CBOT's electronic trading business
as a separate for-profit electronic trading company.

After careful consideration of these alternatives, the Task Force determined
that the most beneficial structure would be the third alternative. The Task
Force presented this plan to the full Board and, after several meetings to
review and consider the proposals, on January 19, 2000, the Board approved a
plan reorganizing the CBOT into a for-profit company focused exclusively on
updated open outcry trading, and also reorganizing the CBOT's electronic trading
business (part of which is now operated by Ceres) into a separate for-profit
company focused exclusively on electronic trading.

As autonomous entities, each with a separate business focus, the Board believes
that each would be able to make independent strategic business decisions and
pursue business opportunities as appropriate. As a "for-profit" company, each
would have the financial and decision-making flexibility to pursue alliances and
joint ventures, as well as the resources to make necessary technology
investments. Furthermore, the Board believes that maintaining a separate,
reorganized electronic trading company best positions the membership to benefit
from the growth and high market value of electronic trading companies and
enables the electronic trading company to attract new management talent with e-
business expertise. Merrill Lynch & Co. has
<PAGE>

advised the Restructuring Task Force that the reorganized electronic trading
company would have a higher valuation if it is operated separately from the open
outcry company. It is the Board's belief that a separate, reorganized electronic
trading company would also be better positioned to attract potential investors
and strategic partners.

The overall structure as envisioned by the Board of Directors is illustrated
below:

---------------------------------------------------------
Fully Demutualized as
Two Distinct Companies

-------------- --------------
Members as Members as
Shareholders Shareholders
-------------- --------------

-------------- --------------
Open Outcry Electronic
Corp. Trading Corp.
-------------- --------------

Demutualized Demutualized
For-Profit For-Profit

Governance:
. 2 Boards; 2 Managements
---------------------------------------------------------

Implementation Committee

On January 19, 2000, the Board also appointed a special Board committee, the
Implementation Committee, consisting of nine directors and chaired by David P.
Brennan, to develop and recommend to the Board the remaining definitive terms of
the transactions designed to implement the restructuring plan. The other members
of the Implementation Committee are Charles P. Carey, Andrew J. Filipowski,
Harold W. Lavender, Jr., Peter C. Lee, Veda Kaufman Levin, James P. McMillin,
Joseph Niciforo and Michael P. Ryan. Piper Marbury Rudnick & Wolfe has acted as
special counsel to the Implementation Committee. The Implementation Committee
was also advised by Merrill Lynch & Co., A.T. Kearney and Kirkland & Ellis, as
counsel to the CBOT and the Board. The Committee has held 15 meetings and
established working groups to address specific business, legal and other issues
in further refining the restructuring plan.

The terms of the restructuring plan presented in this report reflect the details
of the Plan developed by the Implementation Committee to date. The
Implementation Committee is continuing to evaluate the proposed terms of the
subsequent steps of the restructuring and will present its final recommendations
relating to the subsequent steps of the restructuring to the full Board for its
approval prior to submitting the definitive terms to you for your approval.
<PAGE>

THE RESTRUCTURING PLAN

Summary

The overall restructuring plan as currently contemplated provides for membership
in the CBOT represented by ownership of two classes of stock, each of which
would be distributed to the current membership.

. One class of stock (Class B) would be bundled with trading rights and
would be distributed to current members of the CBOT. Access to trading
would be restricted to the owner/holder of the trading rights.

. A separate class of stock (Class A) representing solely an equity
interest in the CBOT and unrelated to the class of stock with bundled
trading rights will also be established and distributed to members to
provide future flexibility for funding capital needs and attracting
strategic investors.

The restructuring plan is designed to enable CBOT members to monetize their
equity interests in the CBOT and, as a result, to provide a more liquid
investment. Implementation of the restructuring plan may also provide CBOT with
additional access to capital to fund new business initiatives.

Following approval of the membership in the first member vote, the CBOT would
initially reorganize its electronic trading business as a wholly-owned
subsidiary of the CBOT.

After approval of the subsequent steps of the restructuring, the CBOT membership
ultimately would receive membership interests represented by equity shares in
the for-profit electronic trading company. It is currently contemplated that the
electronic trading company might potentially offer additional shares to the
public. However, we cannot assure you that an offering will occur.

The first member vote will not constitute a securities offering because Delaware
NFP CBOT will be a not-for-profit, nonstock corporation after completion of step
one of the restructuring. We currently anticipate, however, that the decision
whether to proceed with the for-profit conversion of the CBOT and the allocation
of shares in the companies will constitute an offering of securities.
Accordingly, members will receive a prospectus/proxy statement in connection
with a solicitation of approval for these transactions.

Accordingly, this document is not a prospectus and does not constitute an offer
to sell or the solicitation of an offer to buy securities. No offering of
securities shall be made except by means of a prospectus declared effective by
the SEC under the Securities Act of 1933.

The following sections outline in greater detail the rationale for reorganizing
the CBOT as a for-profit company and reorganizing its electronic trading
business as a for-profit company, and
<PAGE>

generally describe each company as it is expected to operate after execution of
the overall restructuring strategy. Please note that the descriptions contained
herein reflect the current expectations of the Implementation Committee and the
Board and the actual operations may differ when each company is managed by its
own board of directors and management and upon resolution of the final terms of
any agreements described below.

The Reorganized CBOT

The complete restructuring plan calls for the CBOT to reorganize as a for-
profit, open outcry company with the objective of providing an updated,
efficient, well-managed open outcry trading platform. Its strategic focus is
expected to be on maintaining and enhancing liquidity by investing in supporting
technologies to capture and efficiently execute trades, while considering
changes to trading rules and other measures aimed at retaining and enhancing
order flow. We believe that For-Profit CBOT should become more cost-competitive
in its operations as well as more streamlined in its decision-making processes.
The CBOT is intended to be "for profit" but closely held and, while the for-
profit corporate structure will allow for dividend payments, For-Profit CBOT
currently is not expected to pay dividends.

Along with establishing and increasing earnings, which will be the primary focus
of For-Profit CBOT, membership opportunities and support will continue as
priorities of the new organization in accordance with applicable law. While
bringing a more formal business discipline to the CBOT is a significant
objective of the restructuring plan, the main reasons to become a for-profit
corporation are to allow the CBOT to be governed by a more modern and developed
body of corporate law in Delaware than that provided by the CBOT's current
special charter and the Special Charter Act and to allow for more streamlined
corporate governance provisions as discussed below.

A demutualized, for-profit entity will have the operating flexibility to take
actions to achieve optimal staffing levels. Variable expenses, such as travel,
marketing and support costs, are expected to be analyzed and adjusted
accordingly.

In parallel with actions to create a more efficient organization, plans call for
active investment in technology to enhance efficiency and effectiveness of
operations. These plans include:

. Utilizing technology, including the global network and the CBOT's
Order Direct application programming interface ("API"), to expand the
business and enhance order capture and routing capability; and

. Providing "hit and take" functionality linking the pits to the
electronic trading company.

Also, as reorganized, For-Profit CBOT will initially maintain and potentially
grow market data revenues by offering value-added information services and a
variable fee structure for different customers and trading participants.

Streamlined corporate governance would allow the reorganized open outcry company
to redefine the traditional relationship between the exchange and its
membership. As described further
<PAGE>

below, the full restructuring strategy calls for authority to be reallocated
from the membership to the Board, which is consistent with modern business
models. Business decisions could be reached more quickly, enabling For-Profit
CBOT to be more responsive to competitive pressures. Management would be
empowered to aggressively pursue business growth opportunities and cost
reduction efforts, identify and retain key assets from the current organization
and obtain required new capabilities.

The Reorganized Electronic Trading Company

The electronic trading company would continue CBOT's endeavor to build a market
leadership position by providing a superior electronic trading platform,
initially capitalizing on the CBOT brand and Eurex alliance and providing
greater access to a continually expanding global trading community. These
clients will not be required to own seats or any other type of membership
interests in order to utilize directly the electronic trading platform.

The reorganized electronic trading company is expected to commence operations
shortly after the first member vote and is currently expected to trade every
product currently offered by the CBOT with full fungibility of such products and
clearing functions provided by the Board of Trade Clearing Corporation.
Additional products may be developed by the electronic trading company
independently of the CBOT. Thus, product offerings at the two companies may
change over time.

While the focus would be on creating a cost-competitive trade execution
capability, the company would also invest aggressively in technology to maintain
and enhance its competitive advantage. This could include developing new
business and revenue sources in areas such as business to business e-commerce
for commodity trading, direct retail access and franchising its capability to
other exchanges and geographies.

As a market leader, the electronic trading company will be designed to bring
order flow to the electronic platform by providing incentives to customers to
trade products at higher volumes. Part of the investment in business development
would also be to support increased access to an expanded trading community.
Large business development budgets would be established with the expectation
that the electronic trading company would have to provide volume discounts,
build access capabilities to specific client segments and offer other incentives
to capture order flow.

To ensure its prospects for success, the electronic trading company should be
quick to market by activating as soon as possible. Moving rapidly is critical to
capture early mover advantages for the new electronic trading company and
encourage potential competitors to join in alliances. Strategic investors,
including those who can bring order flow as well as equity capital, would be
sought out. If market conditions permit, the electronic trading company may seek
to raise capital in an initial public offering ("IPO"), although we have been
provided no assurances of success in this regard. Management would need to
acquire new leadership with e-business expertise and continue to leverage and
build on the Eurex alliance. Non-core functions would be outsourced in order to
attain a cost structure scalable with volume shifts.
<PAGE>

Eurex is expected to provide the technology platform for the electronic trading
company for at least the term of the current Eurex agreement, which is not
currently expected to terminate until 2004. In addition, the electronic trading
company would allow the CBOT members to effect transactions through the
electronic trading company from the floor of the CBOT.

Benefits

The Board believes that maintaining two separate, for-profit entities, each with
a different focus, should provide both For-Profit CBOT and the electronic
trading company with the best chance to succeed, as each can make independent
strategic business decisions and pursue business opportunities as they see fit.
As for-profit corporations, both companies would have the financial and
decision-making flexibility to pursue alliances and joint ventures, as well as
the resources to make necessary technological investments. Furthermore,
reorganizing CBOT's electronic trading business as a separate, for-profit
corporation should better position the membership to benefit from the growth and
high market value of such companies. A stand-alone, for-profit electronic
trading company would also be better positioned to attract new management talent
with necessary e-business experience. Finally, Merrill Lynch & Co. has advised
the Board that the electronic trading company will have a higher valuation if it
is maintained as a separate entity from the CBOT.
<PAGE>

ONGOING RELATIONSHIPS BETWEEN FOR-PROFIT CBOT
AND THE ELECTRONIC TRADING COMPANY

Even though For-Profit CBOT and the electronic trading company will be
reorganized as separate corporations, they will continue to share certain
information and resources in order to exploit economies of scale. While final
arrangements will need to be negotiated with the management of the electronic
trading company, the Board is considering certain cooperative objectives.

There are expected to be no ongoing fees paid by the electronic trading company
to For-Profit CBOT for the products of the CBOT traded by the electronic trading
company or in consideration of the non-competition agreement.

CBOT members will be afforded full trading rights and privileges to trade at the
electronic trading company. CBOT members are expected to be able to access the
electronic trading company on the trading floor of the For-Profit CBOT via hand-
held electronic devices offering "hit or take" functionality. Any such access
would be governed by normal access policies and business rules of the electronic
trading company. In addition, For-Profit CBOT will own the Order Direct API,
open outcry order routing infrastructure and any enhancements to them. The
electronic trading company would own the Values API from the CBOT-Eurex Alliance
and any enhancements to it.

Market data services, such as quote and information dissemination, are expected
to be operated as a consolidated function within For-Profit CBOT and will be
shared by For-Profit CBOT and the electronic trading company for fungible
products for an 18-month period, which we currently expect to commence shortly
after the electronic trading company is formed. The consolidated market data
function will utilize a single set of rules and policies and have only one
pricing schedule for both entities. All revenue from the market data function
will accrue to For-Profit CBOT for the 18-month period.

For the subsequent 18 months, For-Profit CBOT and the electronic trading company
will share revenue. Revenue on raw quotes will be proportioned according to
each entity's volume in the applicable contract volume, and revenue on value-
added information will be shared based on which entity originated the product or
other negotiated terms. Thereafter, the boards of the two entities will decide
whether there will be an ongoing consolidation of the market data function.
For-Profit CBOT will attempt to grow the revenue of the market data function by:

. Providing alternative pricing schemes to attract and retain new
customers;

. Increasing distribution;

. Developing, marketing and selling other value added services; and

. Seeking opportunities with other exchanges.

<PAGE>

The electronic trading company will adopt an approach to market data services
related to new, non-fungible products it develops best suited to its needs.

For-Profit CBOT will enter into a non-compete agreement with the electronic
trading company pursuant to which For-Profit CBOT will be prohibited from
operating an electronic trading system for three years from the date of the
agreement. For-Profit CBOT is expected to be free, however, to develop and
deploy an electronic small order retail execution-type system.

The electronic trading company will be required to list any new products
developed by For-Profit CBOT for the five-year term of the Eurex agreement and,
if the electronic trading company does not want to list a new product, For-
Profit CBOT will be able to list such products on the electronic trading
company's platform at cost and obtain all the revenues from these products.

Following the first membership vote, Delaware NFP CBOT will operate the
regulatory function for the electronic trading company until the subsequent
membership approval and the separation of the electronic trading company from
For-Profit CBOT. Delaware NFP CBOT initially will be legally responsible for
performing the self-regulatory duties of the electronic trading company. At
this time, no significant change is anticipated in the CBOT's ability to fulfill
its regulatory obligations. When the electronic trading company becomes a
designated contract market following completion of the restructuring strategy,
its board will adopt an approach to regulatory services best suited to its
needs.

Until the reorganized electronic trading company becomes a designated contract
market as part of the final steps of the restructuring strategy, it is
anticipated that there will be one rule book. Between the first member vote and
such contract market designation, the Delaware NFP CBOT board of directors will
control the rule book.

In addition to the cooperative efforts discussed above, both companies will have
a common objective to protect and grow total revenue from the derivatives
market.

<PAGE>

FINANCING

The allocation of the total cost of restructuring between the CBOT and the
restructured electronic trading company is still being reviewed by the
Implementation Committee. However, the Board has determined that For-Profit CBOT
and the restructured electronic trading company will each be responsible for
their own start-up and restructuring costs and ongoing common operating costs.

Based upon a preliminary analysis, it is currently expected that both companies
will be able to absorb these costs. As part of the final steps of the
restructuring strategy and the reorganization of For-Profit CBOT, the electronic
trading company and the CBOT are expected to share the then-existing liabilities
expected to approximate $55 million primarily attributable to the development
costs of the CBOT/Eurex alliance. The For-Profit CBOT is expected to receive a
payment of cash and/or securities in an amount equal to such liabilities.

The actual amount of these liabilities, however, has not been determined and
will be subject to a number of factors to be determined in the future. Such
factors include, but are not limited to, prevailing conditions in the private
equity and public markets at the time of capital raising for the electronic
trading company, the financial and operating results of the CBOT and the
electronic trading company through the time of payment and the expected results
of their operations thereafter, additional amounts advanced, if any, by the CBOT
to the electronic trading company in excess of currently expected financings,
the mix of cash and securities comprising such payment and the expected value of
such securities, and the tax consequences to CBOT and the electronic trading
company of such payment and the composition thereof.

Allocation of these liabilities may also be subject to lender consents.
Furthermore, the electronic trading company is expected to pay its portion of
common operating costs including costs related to the CBOT Registrar's Office
for contract deliveries, market data services and regulatory functions.

Potential business expansion plans at the CBOT involving new alliances, markets
and products would require significant additional investment capital. For-
Profit CBOT also will undertake cost reduction efforts and attempt to
restructure its liabilities in order to strengthen its financial position.

The electronic trading company will need to attract capital in order to satisfy
its start-up costs and its allocated costs related to the restructuring. We
currently expect to seek this financing from venture capital investors and
members as well as equity participations from strategic partners who may be able
to bring order flow in addition to capital. However, we cannot assure you that
this capital will be available to the electronic trading company.

It is anticipated that members may be able to subscribe for common shares in the
electronic trading company prior to the initial public offering pursuant to a
registered offering or on a private placement basis, as conditions dictate. No
decision regarding this subscription offering

<PAGE>

has been made and, accordingly, we cannot assure you that such a transaction
will be pursued or, if pursued, competed.

Further details relating to these financing plans will be discussed if and to
the extent they are finalized in connection with the subsequent membership
approval.

<PAGE>

FEES

Trading fees at both companies will be determined independently by their
respective boards of directors and managements. The electronic trading company,
however, will establish exchange fees for CBOT members and their lessees that
are no higher than those charged to anyone else for the term of the three-year
non-compete and cooperative agreement. Large business development budgets are
expected to be established by the electronic trading company to build order flow
by providing volume discounts, building capabilities for specific client
segments and other incentive programs. For-Profit CBOT may engage in similar
activities to capture order flow.

CLEARING

It is currently expected that all products at both For-Profit CBOT and the
reorganized electronic trading company will be cleared initially through the
Board of Trade Clearing Corporation ("BOTCC") pursuant to two separate
contracts. These contracts are expected to prohibit any third party from having
cross margin benefits or offset with the contracts shared by the For-Profit CBOT
and the electronic trading company.

Clearing through BOTCC should provide complete fungibility of products traded at
For-Profit CBOT and the electronic trading company. Furthermore, For-Profit
CBOT is not expected to pay higher clearing charges than the electronic trading
company to BOTCC.

Fungibility of products between the two platforms should benefit For-Profit CBOT
as well as the electronic trading company. By sharing liquidity, the open outcry
platform would be able to retain order flow that might otherwise migrate to the
electronic trading company. Fungibility would also allow market participants to
offset their open interests across the two platforms and provide cross-margin
benefits through BOTCC. The agreement to provide "hit or take" functionality in
the pits would permit open outcry traders to take maximum advantage of the
shared liquidity and fungibility. Finally, since the members would own the
stock of the electronic trading company upon the allocation of its shares, they
would thereby share in the value created at the electronic trading company by
virtue of the fungibility of products with For-Profit CBOT.

The Board has entered into discussions with BOTCC regarding these relationships
and these terms are subject to BOTCC approval. More information will be
forthcoming in connection with the solicitation of subsequent membership
approval.

<PAGE>

RESTRUCTURING IMPLEMENTATION

Reincorporation of CBOT into Delaware For-Profit Corporation

The CBOT is currently organized under its own special charter granted by the
Illinois legislature in 1859 and has a status that is generally comparable to
that of an Illinois not-for-profit corporation. For corporate law reasons, as
part of step one of the restructuring, CBOT would first elect to accept the NFP
Act, and then CBOT would merge into a newly formed Delaware not-for-profit,
nonstock corporation, Delaware NFP CBOT. Delaware NFP CBOT would be the
surviving corporation in this merger.

The State of Delaware has a more developed, modern and flexible body of
corporate law than the Illinois law currently applicable to the CBOT. Unlike
the law of Illinois which is applicable to the CBOT, the corporate law of
Delaware would permit Delaware NFP CBOT to elect to become a for-profit
corporation while also providing flexibility to engage in mergers or other
business combinations that might be pursued.

As discussed herein, the electronic trading company will be reorganized as a
wholly-owned for-profit subsidiary of Delaware NFP CBOT in connection with the
first step of the restructuring. The election of the CBOT to accept the NFP Act
and the merger of the CBOT into Delaware NFP CBOT would both require an
affirmative vote of two-thirds of the votes present and voting in the first
member vote.

STEP ONE
--------- --------- ---------
Members Members Members
--------- --------- ---------

------- --------------- --------------
CBOT ___\ Illinois NFP Delaware NFP
------- / ___\
CBOT / CBOT
--------------- --------------

Merger
(Elects to be (Illinois not- (Delaware
governed by for-profit not-for-profit,
Illinois NFP corporation nonstock
Act) under Illinois corporation)
NFP Act)

--------------------
Electronic Trading
Company Subsidiary
--------------------

Unlike the laws of most states, including Illinois, Delaware law permits a not-
for-profit, nonstock corporation to elect to become a for-profit corporation by
amending its certificate of incorporation or merging into a for-profit
corporation. Upon approval of the members as part of the subsequent membership
approval, Delaware NFP CBOT would amend its certificate of

<PAGE>

incorporation to become a for-profit, stock corporation organized under the laws
of the State of Delaware.

Upon conversion of Delaware NFP CBOT into a for-profit, stock corporation, the
existing memberships in Delaware NFP CBOT will be converted into membership
interests consisting of two classes of stock of For-Profit CBOT. One class of
For-Profit CBOT stock (Class B) would represent equity bundled with trading
rights and would entitle the holder thereof to access the open outcry trading
platform of For-Profit CBOT. The other class of For-Profit CBOT stock (Class A)
would represent pure equity (i.e., no trading rights) in the company. All
holders of current CBOT membership interests would receive shares of Class A
stock. In addition, each class of existing membership interests would receive
shares of a series of Class B stock that corresponds to the specific membership
interests currently held. For example, Full Members would receive Class B
shares that ensure that they continue to possess full rights and privileges to
trade as principal and broker in all contracts traded on For-Profit CBOT.

The amendment of the Delaware NFP CBOT certificate of incorporation to elect
for-profit status will be subject to the majority vote of the members present
and voting in the subsequent membership approval, according to the terms of the
Delaware NFP CBOT certificate of incorporation. As part of the final steps of
the restructuring strategy, members would receive an allocation of shares of
For-Profit CBOT as described above and shares of common stock of the electronic
trading company in what is currently anticipated to be a tax-free transaction.
More information about the conversion of memberships in Delaware NFP CBOT into
membership interests consisting of stock in For-Profit CBOT and the allocation
of the stock of the electronic trading company will be provided to you in
connection with a subsequent membership vote.

UPON COMPLETION OF THE RESTRUCTURING

Fully Demutualized as
Two Distinct Companies

-------------- --------------
Members as Members as
Shareholders Shareholders
-------------- --------------

------------------- --------------------
Electronic trading
For-Profit CBOT Company
------------------- --------------------

Delaware for-profit Delaware for-profit
stock corporation stock corporation

<PAGE>

Electronic Trading Company

The electronic trading company will succeed to the electronic trading business
of CBOT, including the operations of the "electronic trading" division of Ceres.
Ceres currently operates two businesses, the electronic trading division and the
foreign consultancy division. Only the electronic trading division will become
a part of the electronic trading company in connection with the restructuring.
The foreign consulting division will become a part of For-Profit CBOT.

As discussed above, the CBOT's electronic trading business would be reorganized
initially as a for-profit Delaware corporation, which would be a wholly-owned
subsidiary of Delaware NFP CBOT or an affiliate. It would utilize the Eurex
platform for its electronic trading system. Electronic trading rights are not
expected to be linked to ownership interests in the electronic trading company
or For-Profit CBOT. The electronic trading company is currently expected to
offer electronic trading rights in an "open access" environment where clients
may directly access its trading capabilities. The access policy will be
determined by the board of directors of the electronic trading company and may
include institutional, broker/dealer and retail clients as appropriate in
response to the evolving marketplace.

Ceres Trading Limited Partnership

As part of the restructuring, the electronic trading assets of Ceres will be
rolled up into the electronic trading company, and the foreign consultancy
assets of Ceres will be rolled-up into For-Profit CBOT. The roll-up of Ceres
will occur after the CBOT has elected for-profit status.

Ceres has Class A limited partners (70%) and Class B limited partners (20%) that
together have a 90% interest in the Ceres electronic trading division. Class A
limited partners are members or membership interest holders of CBOT and Class B
limited partners are clearing members of CBOT. CBOT holds a 10% general partner
interest in Ceres. As part of the formation of the electronic trading company
after the first membership vote, it is currently expected that the general
partner interest in Ceres held by CBOT would be contributed to the electronic
trading company.

Under the terms of the Ceres partnership agreement, this roll-up can be
completed without any approvals or action by the limited partners. No vote of
For-Profit CBOT members will be required because the roll-up involves a
subsidiary or affiliate of For-Profit CBOT rather than For-Profit CBOT itself.

Arthur Andersen LLP has conducted a valuation analysis of Ceres in order to
provide their opinion of the fair market value of Ceres and each of the
underlying partnership interests. Through its analysis, Arthur Andersen
prepared a report dated as of May 16, 2000 and concluded therein that the fair
market value of Ceres as of such date was $28,600,000. Accordingly, the
allocation of the value of Ceres based on this report would be as follows:

<PAGE>

Valuation
---------

General Partner (CBOT)......................... $ 2,860,000
Class A Limited Partners....................... 20,020,000
Class B Limited Partners....................... 5,720,000
-----------
$28,600,000

Based on this valuation, if the Ceres roll-up were completed today, it is
expected that the limited partners would receive an allocation of Class A shares
of For-Profit CBOT equal in value to the amounts set forth above. This
valuation analysis would be the method used at later time to allocate
consideration for interests in Ceres, subject to a significant change to any
factors deemed material to the analysis.

Allocation of Electronic Trading Company Stock

The reorganized electronic trading company will be separate from the CBOT and
will operate as an independent for-profit company after the completion of the
full restructuring strategy. As part of the final steps of the restructuring,
member-shareholders of For-Profit CBOT will receive an allocation of shares of
common stock in the electronic trading company. These elements of the final
steps of the restructuring will not be effected until an IRS ruling is obtained
to the effect that the allocation of shares of the For-Profit CBOT and shares of
the electronic trading company will be tax-free to the companies and the
members. After the allocation of its common stock to the members, it is
expected that the electronic trading company will become an independent company
as described below.

Initial Public Offering of Electronic Trading Company

It is currently anticipated that the electronic trading company would undertake
an underwritten offering of its common stock to the public (the "IPO"). We
believe that an IPO reflects an attractive means of monetizing member's
interests and accessing capital for the electronic trading company.

No determination has been made as to the length of time between the
reorganization of the electronic trading company and the IPO, which will depend
on market conditions at the time, as well as other factors. Although we cannot
assure you as to when or whether an IPO will be successfully completed, it is
the Board's current belief that the IPO would help ensure that the value of
membership after the overall reorganization is greater than the value of CBOT
membership currently. It will also provide the electronic trading company with
capital to fund its operations, create capabilities to raise capital for future
investments and growth, and strengthen its competitive position.

<PAGE>

WHAT MEMBERS WILL RECEIVE

CBOT membership interests will be affected in material respects by both the
first step and the subsequent steps of the proposed restructuring.

Step One As part of the reincorporation of CBOT in Delaware as Delaware
NFP CBOT, a Delaware nonstock, not-for-profit corporation, CBOT
membership interests will be converted into membership interests
in Delaware NFP CBOT. These new membership interests will
continue to possess full rights and privileges to trade as
principal and broker in all contracts traded at Delaware NFP
CBOT. However, as described more fully in "Comparison of Rights
of Members of CBOT and the Reorganized Delaware NFP CBOT"
herein, certain rights of members will be changed as part of
step one of the restructuring but, generally speaking, are
expected to be substantially similar in all material respects to
members' current rights.

Subsequent The subsequent steps of the restructuring will involve the
Steps conversion of Delaware NFP CBOT into For-Profit CBOT, a Delaware
for-profit, stock corporation. As part of Delaware NFP CBOT's
election to become a for-profit, stock Delaware corporation, the
membership interests of Delaware NFP CBOT will be converted into
membership interests represented by shares of common stock in
For-Profit CBOT. In addition, certain rights of members,
including the rights of members to petition and adopt new rules,
will be materially changed as part of the subsequent steps of
the restructuring. These changes have the effect of reallocating
authority from the membership to the board of directors. In
addition, the electronic trading company, reorganized in step
one as a Delaware for-profit, stock corporation, will allocate
stock to the members.

For-Profit CBOT Stock

As part of the conversion to a Delaware for-profit, stock corporation, it is
expected that CBOT memberships will receive two classes of For-Profit CBOT
stock. One class (Class B) will combine all current CBOT trading rights and
privileges with equity while the other class (Class A) will constitute equity
only. For-Profit CBOT may be able to utilize the Class A shares in the future
to raise additional capital or attract strategic investors. However, no
assurances can be given that capital will be raised or strategic investors
attracted. It is currently anticipated that there would be five different
series of Class B shares, each corresponding to the existing trading rights of
one of the five CBOT membership interests, as follows:

<PAGE>

------------------------------------------------------
CBOT Membership Series of Class B
Interest Stock in For-Profit CBOT
------------------------------------------------------
Full B-1
------------------------------------------------------
Associate B-2
------------------------------------------------------
GIM B-3
------------------------------------------------------
IDEM B-4
------------------------------------------------------
COM B-5
------------------------------------------------------

As part of the restructuring, all CBOT members will receive an allocation of
Class A shares and holders of each of the five CBOT membership interests will
receive Class B shares of the specific series (B-1 through B-5) that corresponds
to the CBOT membership interest held by such member. For example, CBOT Full
Members will receive Class A "equity only" shares and will receive Class B-1
shares ensuring that they continue to possess full trading rights and privileges
to trade as principal and broker in all contracts traded on the CBOT.

Electronic Trading Company Stock

As part of the restructuring, CBOT members will also receive an allocation of
shares of common stock in the electronic trading company.

Share Allocation Methodology

Stock in For-Profit CBOT and the reorganized electronic trading company will be
allocated to each CBOT member according to the type of membership interest in
the CBOT currently held by each member. The vast majority of the total equity
interests in For-Profit CBOT, measured by number, is expected to be represented
by the Class A shares and a small portion of the equity interests, as well as
the trading rights and privileges in the CBOT, is expected to be represented by
the Class B shares.

It is currently expected that the electronic trading company will have only one
class of common stock, representing 100 percent of its total equity.

In connection with the initial approval of the restructuring strategy, on
January 19, 2000, the Board formed an Independent Allocation Committee of the
Board of Directors to develop and present a recommendation to the Board with
respect to the appropriate and fair allocation of value of For-Profit CBOT and
the reorganized electronic trading company among the current CBOT membership.
The final decision regarding the allocation of value in For-Profit CBOT and in
the electronic trading company, which in the event of a significant change in a
factor material to the allocation analysis, may be subject to modification, will
not be made by the CBOT Board until immediately prior to submitting the
subsequent steps of the restructuring plan to the members. In order to ensure
independence and lack of self-interest, the Allocation Committee is currently
comprised of four outside directors of CBOT, Dr. Robert S. Hamada, Robert H.

<PAGE>

Michel, Ralph H. Weems, and chaired by Governor Thompson. Special counsel to
the Independent Allocation Committee is Winston & Strawn and William Blair &
Company, L.L.C. is their financial advisor.

As directed, the Allocation Committee has developed an allocation methodology
which has been reviewed and approved by the Board. The Committee considered a
variety of factors and the allocation methodology takes into account a
combination of factors rather than a determination based on a single factor.
Although they did not assign specific weight to any particular factor, the
Committee did give greater importance to liquidation and voting rights and to
the allocation ratio employed in the formation of Ceres. The Allocation
Committee did consider seat prices and historical contract volumes. Pursuant to
this allocation methodology, the number of Class A and Class B shares in the
reorganized For-Profit CBOT and the number of shares of common stock in the
reorganized electronic trading company that will be issued to the CBOT members
will be determined by the Board immediately prior to the time the registration
statement with respect to such stock is declared effective by the SEC. At that
time, based on the proposed methodology, and assuming no significant change of a
material factor discussed above, we currently expect that the Class A and Class
B shares of the reorganized For-Profit CBOT and the common stock of the
electronic trading company would be distributed to the CBOT members as follows
(without giving effect to the issuance of additional shares in connection with
the Ceres roll-up as discussed herein):

. Each full, Associate, GIM, IDEM and COM membership will receive Class
A and Class B shares of For-Profit CBOT and shares in the electronic
trading company on a 5.00 - 1.00 - 0.50 - 0.07 - 0.06 basis.

Although we cannot assure you at this time that this will be the allocation of
stock in the two companies, because the allocation is subject to Board approval
prior to the applicable subsequent membership approval, this is what we
currently expect the allocation to be, absent a significant change of a material
factor discussed above and subject to any adjustment that may be required to
take into account the Ceres roll-up.

In addition, each of the Class A and Class B shares in For-Profit CBOT and the
shares of the electronic trading company will represent the right to cast one
vote for matters submitted to a vote of shareholders thereof and, therefore, the
initial voting power on a membership-interest basis in For-Profit CBOT and the
electronic trading company will be distributed according to the ratios set forth
above and on the percentage ownership basis set forth in the table below.

As a result of this allocation methodology, set forth below please find a
comparison of the ownership percentages of both the For-Profit CBOT and the
electronic trading company resulting from the Allocation Committee's
recommendation as well as other factors examined by the Allocation Committee:

<PAGE>

Ownership Percentages from Various Allocation Methodologies

<TABLE>
<CAPTION>
Seat Market Value
--------------------------------
Allocation
of
Percentage
Interest Median/(3)/ Independent
--------------------
Allocation
Member Liquidation Voting Ceres Contract Committee
Class Seats/(1)/ Rights Rights Formation/(2)/ 1999 1995-1999 Spot/(4)/ Volume/(5)/ Recommendation/(6)/
------ ---------- ----------- -------- -------------- -------- --------- --------- ----------- -------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Full 1,402 89.99% 91.57% 90.29% 75.62% 70.58% 83.74% 50.00% 88.07%
AM 774 8.28% 8.43% 8.31% 16.78% 20.86% 11.60% 39.90% 9.72%
GIM 184 1.31% 0.00% 0.99% 1.80% 1.93% 1.00% 0.60% 1.16%
COM 643 0.21% 0.00% 0.21% 3.89% 5.01% 2.58% 4.80% 0.57%
IDEM 641 0.21% 0.00% 0.21% 1.90% 1.62% 1.08% 4.70% 0.48%
----------- -------- -------------- -------- --------- --------- ----------- -------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
=========== ======== ============== ======== ========= ========= =========== ===================
</TABLE>

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

(1) Seat count as of April 5, 2000.
(2) Reflects allocation among the member classes of 70% interest in Ceres.
(3) One and five year periods ending July 21, 1999.
(4) As of May 4, 2000.
(5) Based on volume from September 1998 through February 2000.
(6) Reflects allocation of shares of common stock in For-Profit CBOT and the
electronic trading company to each Full, Associate, GIM, COM and IDEM
membership, respectively, in the ratio of 5.00:1.00:0.50:0.07:0.06.

<PAGE>

In addition to the stock issued to For-Profit CBOT members pursuant to the
restructuring, it is also expected that For-Profit CBOT will have authorized but
unissued Class A shares, and the electronic trading company will have authorized
but unissued common stock, each of which will be available for capital raising
activities (e.g., sale of stock), strategic business initiatives (e.g.,
acquisition of another company for stock) and share-based compensation programs
(e.g., stock option incentive compensation plans). However, we cannot assure you
as to whether or when such shares will be issued to outside investors or for
what purposes.

In summary, as a result of the restructuring, each CBOT member will receive the
following types of stock in For-Profit CBOT and the electronic trading company,
in the ratios set forth above.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
Electronic Trading
For-Profit CBOT Stock Company Stock
CBOT Membership Interest Received Received
--------------------------------------------------------------------------------------
<S> <C> <C>
Full Class A & Class B-1 Common Stock
--------------------------------------------------------------------------------------
Associate Class A & Class B-2 Common Stock
--------------------------------------------------------------------------------------
GIM Class A & Class B-3 Common Stock
--------------------------------------------------------------------------------------
IDEM Class A & Class B-4 Common Stock
--------------------------------------------------------------------------------------
COM Class A & Class B-5 Common Stock
--------------------------------------------------------------------------------------
</TABLE>

The report of the Allocation Committee is available for review at the Office of
the Secretary of the CBOT.

TRANSFER OF EQUITY INTERESTS

For-Profit CBOT

It is anticipated that the vast majority of the membership interests, by number,
then consisting of shares of stock in For-Profit CBOT, will be represented by
the Class A shares. Initially, these Class A shares will be closely held among
the current members of the CBOT, which will affect the liquidity and
determination of the value of such shares. The board of directors of For-Profit
CBOT will reserve the right to impose transfer restrictions on these shares in
order to address the following issues, among others:

. Protection against large amounts of Class A shares being sold within
certain time periods, which could prohibit holders from realizing the
full value of their Class A shares;

. Institution of appropriate limits on the sale of Class A shares to
maintain an orderly market for the Class A shares; and

<PAGE>

. Protection against an investor establishing a controlling position in
Class A shares without the Board's consent, either at prices below
what the Board believes reflects the long-term value of For-Profit
CBOT or for the purpose of influencing the decision-making process of
For-Profit CBOT.

Class B shares, which will be bundled with trading rights, may not be
transferred unless the eligibility requirements imposed by For-Profit CBOT on
persons eligible for trading are satisfied. As discussed below, the eligibility
requirements are not expected to be substantially different than the current
eligibility requirements for membership in the CBOT.

Electronic Trading Company

Initially, the entire equity interest in the electronic trading company will be
represented by its shares of common stock. Prior to an IPO, the board of
directors of the electronic trading company, working together with the
underwriters of the IPO, may establish transfer restrictions with respect to the
shares of common stock of the electronic trading company. These transfer
restrictions may be more or less restrictive than those imposed on For-Profit
CBOT's Class A shares, and certain additional differences may exist.

Lock-up agreements are typical arrangements between the underwriters and
significant stockholders in a company that restrict the ability of such
stockholders to sell their stock in order to facilitate the efficient marketing
of an offering. There is currently expected to be a lock-up period restricting
the sale of shares of common stock of the electronic trading company.

In the event that the IPO is not successfully completed, a liquid trading market
for the shares of the electronic trading company may never develop. At this
time, we cannot provide you with any assurances with respect to the outcome of
these issues.

TRADING RIGHTS

The trading rights in For-Profit CBOT will be "bundled" with its Class B shares.
The electronic trading company will have open access to trading and,
accordingly, no special trading rights will be associated with the stock in the
electronic trading company. CBOT members, however, will have full rights and
privileges to trade as principal and broker in all contracts traded on the
electronic exchange in which such membership interest holders have current
trading rights at the CBOT.

For-Profit CBOT

As previously discussed, trading rights and privileges in For-Profit CBOT will
be associated with its Class B shares, with different series of Class B shares
mirroring the trading privileges currently associated with the various
membership interests in CBOT to the extent permitted under Delaware law. For
example, holders of Class B-1 shares will continue to possess the full trading
rights and privileges currently possessed by the CBOT's Full Members. Therefore,
trading access at the CBOT will continue to be restricted, with trading rights
"bundled" with an equity interest.

<PAGE>

CBOE Exercise Right

One source of significant value to Full Members of the CBOT is the embedded
right to trade at the Chicago Board Options Exchange ("CBOE"). While a member
may only trade at one or the other exchange at a time, this exercise right
effectively means that a CBOT Full Member has access to two exchanges. In
addition, since a Full Member has the additional right to lease his or her
membership (other CBOT membership classes have this right as well, but may not
gain CBOE access), it means that members may enjoy the value of this right even
after they retire from active trading. Currently, nearly half of the CBOT Full
Members have exercised their right to access trading at the CBOE.

The Board fully intends to preserve the CBOE exercise right. The CBOT's legal
counsel has advised the Board that the 1992 agreement with the CBOE contemplates
a restructured CBOT under certain conditions and, while the CBOE has
communicated that it disagrees and has suggested that it will contest trading
access through the CBOE exercise right subsequent to the restructuring plan, the
Board and legal counsel believe that the CBOT Board-approved restructuring plan
complies with those conditions.

The Board is currently in discussions with the CBOE regarding a potential
combination of the businesses of the CBOT and the CBOE. Currently, however, no
agreement has been reached with the CBOE with respect to any combination and we
cannot assure you that any agreement will in fact be reached.

Leasing of Trading Privileges

As is currently the case, CBOT members will continue to be able to lease their
trading privileges to other parties under certain conditions after the
restructuring which are expected to be substantially similar to the current
conditions established for leasing. The trading privileges component of the
Class B shares can be used by the owner of such Class B shares or can be leased
to another party who satisfies the eligibility requirements imposed by For-
Profit CBOT. It is intended that such eligibility requirements will be
substantially similar to the current CBOT requirements.

Transfer Restrictions

No Class B shares may be transferred until the eligibility requirements imposed
by the reorganized CBOT on persons eligible for trading are satisfied. It is
intended that such eligibility requirements will be substantially similar to the
current requirements, although the Board reserves the right to modify the
transfer restrictions.

Electronic Trading Company

When the electronic trading company begins operations, Full Members of the CBOT,
as well as all other membership interest holders at the CBOT, will have full
rights and privileges to trade as principal and broker in all contracts traded
on the electronic exchange in which such membership interest holders have
current trading rights at the CBOT. Electronic trading rights are not expected
to be linked to ownership interests in the electronic trading company or For-
Profit CBOT. The electronic trading company is currently expected to offer
electronic trading rights in

<PAGE>

an "open access" environment where clients may directly access its trading
capabilities. The access policy will be determined by the board of directors of
the electronic trading company and may include institutional, broker/dealer and
retail clients as appropriate in response to the evolving marketplace. Trading
privileges in the electronic trading company will include the right to trade all
current CBOT contracts plus additional products carried by the electronic
trading company, if any.

<PAGE>

CORPORATE GOVERNANCE AND MANAGEMENT

In order to enhance the efficiency and accountability of corporate decision-
making, it is contemplated that, as part of the subsequent steps of the
restructuring, CBOT will adopt a new, streamlined model of corporate governance
intended to be more similar to the governance of most publicly-traded
corporations. Similarly, the electronic trading company, upon its reorganization
as a for-profit company, will be organized with governance provisions similar to
those of other publicly traded e-commerce businesses.

CBOT

CBOT Step One

Certain changes in the governance and management structure of the CBOT will
occur upon the implementation of step one of the restructuring plan. For the
most part, these changes are procedural or administrative in nature and are
designed to "modernize" the CBOT and streamline its corporate governance model
in a manner consistent with the overall restructuring strategy. As previously
stated, the first step of the restructuring involves CBOT converting into a
Delaware non-stock, not-for-profit corporation. As part of this reincorporation,
Delaware NFP CBOT will be governed by a new certificate of incorporation and by-
laws, which together will incorporate, to the largest extent possible under
Delaware law, substantial portions of the current CBOT Rules and Regulations.

The composition of the board of directors of Delaware NFP CBOT will be identical
to the current Board. The Certificate of Incorporation and Bylaws of Delaware
NFP CBOT as a Delaware not-for-profit, nonstock corporation are attached as
Exhibits to the Chicago Board of Trade Restructuring--Step One Ballot
Disclosure, which is attached to the ballot as an Exhibit (the Chicago Board of
Trade Restructuring - Step One Ballot Disclosure together with the Exhibits,
collectively the "Ballot Disclosure").

CBOT Subsequent Steps

When Delaware NFP CBOT converts into For-Profit CBOT, a Delaware for-profit,
stock corporation, in a subsequent step in the restructuring, For-Profit CBOT
will adopt a more streamlined corporate governance model similar to that found
in many publicly-traded corporations. Generally, modern corporate governance is
characterized by democratic principles whereby stockholders elect directors who
are ultimately responsible for the management of the company. Each share held
entitles a stockholder to vote on matters submitted to a vote of the
stockholders. The stockholders do not directly influence management decisions
relating to the operation of the business of the company other than through the
exercise of their rights to elect directors and approve certain extraordinary
transactions such as mergers, business combinations, sales of all the assets or
increases in authorized shares of stock.

Upon completion of the entire restructuring strategy, it is expected that the
new governing documents of For-Profit CBOT will repeal the petition process and
vest greater authority with the board of directors. This will have the effect of
shifting power regarding the direction of the CBOT from the members to the board
of directors of For-Profit CBOT. In addition, For-Profit

<PAGE>

CBOT will adopt new trading rules, which are expected to modernize those
currently in effect at CBOT. Subsequent changes to the rules will not require
membership approval. The Implementation Committee is working to develop the
organizational documents and trading rules and regulations that will govern For-
Profit CBOT. These documents will be submitted for your review and approval as
part of the subsequent membership approval.

The current Board of the CBOT will remain in place as the initial board of
directors of Delaware NFP CBOT. The CBOT Board, however, is expected to be
streamlined to consist of nine members in connection with the subsequent step of
reorganizing as For-Profit CBOT. The CBOT Board is expected to charge the
Nominating Committee of the Board to recommend a slate of non-CBOT member or
"external" directors and CBOT-member or "internal" directors for the For-Profit
CBOT final Board of Directors. Upon approval by the Board, all of the internal
directors, including the chairman, will be elected by the members. The external
directors will be elected by the CBOT Board.

After completion of the overall restructuring, the For-Profit CBOT Board of
Directors is expected to consist of a total of nine members, of whom six are
expected to be members of For-Profit CBOT and three are expected to be
independent, non-CBOT members. The For-Profit CBOT Board of Directors will be
divided into three "staggered" classes of directors, with the term of each class
expiring in successive years over a three year period. It is currently expected
that For-Profit CBOT's three classes of directors will have the following terms
when the final For-Profit Board is established for the first time:

. two internal directors (including Chairman) and one external director
for one-year terms;

. two internal directors and one external director for two-year terms;
and

. two internal directors and one external director for three-year terms.

At each subsequent annual election, each class of directors whose term has
expired will stand for election to a new three year "staggered" term. After the
final For-Profit CBOT Board of Directors has been established, future For-Profit
CBOT Boards of Directors will propose "internal" and "external" directors as
their terms come due and all directors will be elected by the members. The
Chairman will be elected by members of the For-Profit CBOT Board of Directors.

Electronic Trading Company

The governance of the reorganized electronic trading company will provide for
the modern governance mechanisms discussed above and employed by many publicly
traded corporations. The Implementation Committee has developed the Certificate
of Incorporation and By-Laws for the electronic trading company as a wholly-
owned Delaware for-profit, stock corporate subsidiary and these documents are
available for review at the Office of the Secretary of the CBOT. These documents
will govern the operations of the electronic trading company as soon as it is
organized as a wholly-owned subsidiary of Delaware NFP CBOT. These documents may
be revised in connection with capital raising activities such as the expected
IPO to reflect the provisions typical of a stand-alone public company.

<PAGE>

Initially, as a subsidiary of the CBOT, the electronic trading company will be
subject to the trading rules and regulations of the CBOT. The Implementation
Committee is in the process of developing the trading rules and regulations
applicable to the electronic trading company after the allocation of its shares
to the members. The Board will present these to you for your review in
connection with the applicable subsequent membership approval.

It is intended that the management of the electronic trading company will be
substantially independent as soon as it is established. Merrill Lynch & Co. has
indicated to the Board that having independent management in place and executing
the business plan outlined herein is necessary in order to position the
electronic trading company as a viable candidate to attract strategic partners
and for an initial public offering.

The CBOT Board will retain, however, the authority to establish certain terms of
operations of the electronic trading company. Powers reserved to the CBOT Board
for approval are currently expected to include, without limitation, the issuance
of up to 20% of the equity of the electronic trading company, the operation of
Ceres by the electronic trading company as general partner and policies with
respect to fees, hours, margins and access. During the interim period after the
first member approval and the final separation of the reorganized electronic
trading company, as the board of directors of the controlling shareholder of the
electronic trading company and due to various operational requirements such as
funding and access to products, platforms and fungibility, the Delaware NFP CBOT
board of directors ultimately will be in a position to direct the focus of the
electronic trading company and its board of directors.

The Board has directed the Implementation Committee, in consultation with the
Nominating Committee of the CBOT, to search for appropriate directors and
management for the electronic trading company. The Nominating Committee will
recommend a slate of external directors for the transition board of the
electronic trading company. The Implementation Committee will recommend a slate
of internal directors for the transition board of the electronic trading
company. It is anticipated that the external members of the transition board
will serve on the final board. Once the Nominating Committee and the
Implementation Committee have decided upon appropriate candidates, they will
present such candidates to the CBOT Board for its consideration. The CBOT Board
will have the authority to elect the directors and appoint officers of the
reorganized electronic trading company, pursuant to its authority as the Board
of Directors of the sole shareholder of the electric trading company.

Consequently, the initial board of directors and management of the electronic
trading corporation will not be appointed or elected by the CBOT members. The
electronic trading company's board of directors initially is expected to consist
of a total of seven members, of whom four are currently expected to be members
of the CBOT, who may or may not be members of the current Board, and three are
currently expected to be independent parties with outside e-commerce or related
experience. The board of directors of the electronic trading company will be
authorized to have up to fifteen members in order to provide the flexibility to
appoint additional board members, either prior to or after the allocation of its
shares to CBOT members, if required to attract potential strategic investors or
as otherwise determined by the board of directors of the electronic trading
company. The Chairman of the electronic trading company board will be designated
by the electronic trading company's board.

<PAGE>

Although there may be some overlap between the first and final membership
approvals, after the separation of the electronic trading company, it is
currently expected that no members of the board of directors of the electronic
trading company would also be members of the Board of Directors of For-Profit
CBOT. Like the For-Profit CBOT Board of Directors, the board of directors of the
reorganized electronic trading company will be divided into three "staggered"
classes of directors, with the term of each class expiring in different years
over a three year period. The electronic trading company's transition board will
appoint an acting CEO and will begin a professional search for CEO candidates.
Final approval of a CEO will be made by the final electronic trading company
board.

After the initial appointment of the electronic trading company board by the
CBOT Board, the internal and external directors will be proposed by the board as
their terms come due and will be elected by the shareholders of the electronic
trading company. It is currently expected that the electronic trading company's
three classes of directors will have the following terms, when the final
electronic trading company board is established for the first time:

. one internal director and one external director for one-year terms;

. one internal director and one external director for two-year terms;
and

. two internal directors and one external director for three-year terms.

Representatives of the strategic partners (if any) would have a term/tenure as
decided by the Board. The Chairman will be elected by the Board. At each
subsequent annual election, each class of directors whose term has expired will
stand for election to a new three year "staggered" term. After the final
electronic trading company has been established for the first time, future
electronic trading company boards will propose directors as their terms come due
and directors will be elected by the members. The Chairman will be designated by
the electronic trading company board.

COMPETITION

In addition to the competition from outside sources as described above,
following the reorganization, For-Profit CBOT and the electronic trading company
will be competing for derivatives contracts volume, products and order flow. It
is impossible to predict how market pressures will ultimately impact the two
companies. Consequently, it is possible that one or both companies may not
remain viable in the long term.

<PAGE>

COMPARISON OF RIGHTS OF MEMBERS OF THE CBOT AND MEMBERS OF THE REORGANIZED
DELAWARE NFP CBOT

As a result of the reincorporation of the CBOT in the State of Delaware pursuant
to step one of the proposed restructuring, the CBOT will change its status from
that of a "special charter" corporation organized in Illinois to that of a
nonstock, not-for-profit corporation organized in Delaware. In connection with
this reincorporation, the members of the CBOT will become the members of
Delaware NFP CBOT. As a result, some of your rights and obligations will change
from those that you currently have as members of the CBOT. Generally speaking,
however, we believe that your memberships and membership interests in Delaware
NFP CBOT will be substantially similar in all material respects to those you
have in the CBOT today. In this section, we will describe those changes that we
believe to be material. You should carefully review and consider these changes
in your rights and obligations before voting on step one of the restructuring.

The CBOT intends to preserve its nonstock, not-for-profit status by
reincorporating in Delaware as Delaware NFP CBOT in step one of the
restructuring. It is important to note, however, that there currently exist
certain ambiguities with respect to the legal status of the CBOT due to its
unique form of organization as a "special charter" corporation. As a special
charter corporation, the CBOT has not been subject to the regulatory framework
applicable to most Illinois corporations, including both the NFP Act and the
Illinois Business Corporation Act of 1983, as amended. In some respects, the
ambiguities associated with the CBOT's current legal status have created
flexibility that has occasionally been advantageous to the CBOT and that would
likely be lost upon conversion to Delaware NFP CBOT. At the same time, these
ambiguities have created uncertainty regarding the CBOT's legal status that
makes it desirable for the CBOT to elect to be governed under a more modern and
well developed legal framework, such as that of the Delaware General Corporation
Law, as amended (the "DGCL"), in order to more effectively accomplish its
purposes.

While we believe that the reincorporation of the CBOT as Delaware NFP CBOT is
beneficial because it creates greater flexibility for the CBOT, including with
respect to the future implementation of the CBOT's current restructuring plan,
it is important for you to understand that, upon the CBOT's reincorporation in
Delaware, its unique status as a special charter corporation in Illinois may be
lost forever. In this regard, the relinquishing of the CBOT special charter in
step one of the restructuring is irreversible.

General

The rights and obligations of the members of the CBOT are currently governed by
the CBOT's special charter and the CBOT Rules and Regulations as well as the
Special Charter Act and other applicable law. The rights and obligations of the
members of Delaware NFP CBOT will be governed by the Delaware NFP Charter, the
Bylaws (which will incorporate by reference substantial portions of the current
CBOT Rules), substantial portions of the current CBOT Regulations and the DGCL,
as it applies to nonstock, not-for-profit corporations.

<PAGE>

Except as otherwise described below, the CBOT Rules and Regulations, which set
forth most of the rights and obligations of the members of the CBOT, will
generally remain in effect. The current CBOT Rules will remain in effect and
will be incorporated by reference into the Bylaws of Delaware NFP CBOT and the
current CBOT Regulations will remain in effect and become applicable to Delaware
NFP CBOT, in each case with certain exceptions as described in this section.

As a result, many of the Rules and Regulations concerning the Board of
Directors, your rights and obligations as members and other general corporate
governance matters will not be changed as a result of step one of the
restructuring. In fact, with certain exceptions designed to "modernize" the CBOT
and streamline its corporate governance model in a manner consistent with the
overall restructuring strategy, it has been a principal objective of step one of
the restructuring to replicate to the largest extent possible under Delaware law
the provisions governing the existing rights and obligations, including trading
rights and privileges, of members of the CBOT today.

Certain changes between the CBOT today and Delaware NFP CBOT are inevitable.
First, as noted above, certain changes are being implemented in order to
modernize and streamline the corporate governance of the CBOT when it is
reincorporated in Delaware as Delaware NFP CBOT. Second, certain other changes
will occur automatically, as a matter of law as a result of the applicability of
the DGCL rather than the Special Charter Act and other applicable Illinois law.
Finally, certain other changes will be made to existing provisions that may not
be consistent with the DGCL.

The following description summarizes the material differences between the rights
and obligations of holders of the CBOT memberships and membership interests and
holders of Delaware NFP CBOT memberships and membership interests. We do not
intend this summary to be a complete statement of the rights and obligations of
holders of the CBOT memberships and membership interests, or a comprehensive
comparison of the rights and obligations of members and membership interest
holders in the CBOT and Delaware NFP CBOT, or a complete description of the
specific provisions referred to in this summary. We do not intend that this
identification of specific differences is to indicate that other equally or more
significant differences do not exist.

This summary is qualified in its entirety by reference to the Special Charter
Act, the CBOT's special charter and the current CBOT Rules and Regulations with
respect to matters relating to CBOT membership and membership interests, and to
the DGCL, the proposed forms of Delaware NFP CBOT's Amended and Restated
Certificate of Incorporation (the "Delaware NFP Charter") and Amended and
Restated Bylaws (the "Bylaws") and those portions of the CBOT Rules and
Regulations that will remain in effect after the implementation of step one of
the restructuring with respect to Delaware NFP CBOT membership and membership
interests. In addition, the following description does not relate to any changes
in the rights of members in connection with the conversion of Delaware NFP CBOT
into For-Profit CBOT as a part of any subsequent step of the restructuring plan.
Any changes in the rights of members contemplated as a subsequent

<PAGE>

step of the restructuring will be disclosed to the members in connection with
the related member vote.

The forms of the Delaware NFP Charter and the Bylaws will be attached as
Exhibits to the Ballot Disclosure. You should review and consider carefully
those documents before voting on step one of the restructuring.

Legal Name of the CBOT

The name of the CBOT will be changed from "Board of Trade of the City of
Chicago" to "Board of Trade of the City of Chicago, Inc." as part of step one of
the restructuring.

Purpose of the CBOT

As set forth in the preamble to the current CBOT Rules and Regulations, the CBOT
was formed to maintain a commercial exchange; to promote uniformity in the
customs and usages of merchants; to inculate principles of justice and equity in
trade; to facilitate the speedy adjustment of business disputes; to acquire and
to disseminate valuable commercial and economic information; and, generally, to
secure to its members the benefits of co-operation in the furtherance of their
legitimate pursuits. In addition, the special charter of the CBOT currently
provides that the corporation shall have no power to do or carry on any business
excepting such as is usual in the management of the boards of trade or exchange
markets, or as provided in the special charter.

The Delaware NFP Charter will incorporate the purposes and objects of CBOT as
stated in the preamble to the current CBOT Rules and Regulations, and,
accordingly, the object and purposes of Delaware NFP CBOT will include
maintaining a commercial exchange and pursuing the other objects stated therein.
However, Delaware NFP CBOT's purposes will be expanded to include engaging in
any lawful act or activity for which corporations may be organized under the
DGCL and will not include any limitation as currently provided in the special
charter.

Dividends

Currently, the CBOT is a nonstock, not-for-profit entity, organized as an
Illinois special charter organization. This means, among other things, that the
CBOT cannot under any circumstances declare dividends or make distributions to
its members and membership interest holders. Applicable Illinois law does not
provide the CBOT a direct procedure pursuant to which it can change this aspect
of its legal status.

Delaware NFP CBOT will also be a nonstock, not-for-profit corporation.
Accordingly, Article Fourth of the Delaware NFP Charter will provide that
Delaware NFP CBOT is not for profit and shall have no authority to issue capital
stock. As a result of recent amendments to the DGCL, such corporations are no
longer prohibited from paying dividends.

<PAGE>

Delaware is one of a relatively small number of jurisdictions in the United
States that allows a not-for-profit corporation to become a for-profit
corporation, either by merging into a for-profit corporation or by amending its
charter to remove the not-for-profit restriction or to provide that it has the
authority to issue stock. If Delaware NFP CBOT were to reorganize as a for-
profit stock corporation, as is currently contemplated to occur as a part of the
overall restructuring plan, it would have the ability to issue stock to, and
declare and pay dividends and make distributions to, its stockholders (i.e., the
former CBOT members).

The Delaware NFP Charter will provide that the Delaware NFP CBOT can amend,
alter or repeal Article Fourth, which provides that it is not for profit, if
such amendment, alteration or repeal is approved by the Board of Directors and
receives the approval of a majority of the votes cast at a meeting at which at
least 300 votes are cast.

The ability to amend the NFP Delaware Charter in this regard upon the specified
member approval is a material change from the current status of the CBOT. This
change will provide the CBOT greater flexibility in the future to pursue the
proposed restructuring, subject to further member approval.

Terms and Conditions of Membership

Currently, the terms and conditions of membership in the CBOT are set forth in
the special charter and the CBOT Rules and Regulations. The terms and conditions
of membership in the CBOT include, but are not limited to, general provisions
related to application for membership, member rights, privileges and
obligations, member conduct and discipline, registration, assessments and fees,
purchase and sale or transfers of memberships or membership interests,
insolvency, and trading and other rights of the various classes of membership.

The Delaware NFP Charter will provide that the terms and conditions of
membership in Delaware NFP CBOT, 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 Delaware
NFP CBOT, shall be as stated in the Delaware NFP Charter (including Exhibit A
thereto) and the Bylaws. In accordance with the Bylaws, certain terms and
conditions of membership may also be provided in the Regulations.

The Delaware NFP Charter will specifically provide that any person or entity
that held any such membership or interest in CBOT immediately prior to the
Delaware reincorporation merger shall hold such membership or other interest in
Delaware NFP CBOT immediately following the merger, subject to the Delaware NFP
Charter, Bylaws and applicable law. Thus, under the Delaware NFP Charter and
Bylaws, 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 Delaware NFP CBOT will survive and be essentially the same as those
of current members (full, associate or otherwise), member firms, membership
interest holders, delegates and all categories and

<PAGE>

classes of memberships and other interests in the CBOT, except for any changes
required by the DGCL or as otherwise provided for in the Delaware NFP Charter
and Bylaws.

In this regard, the Delaware NFP Charter will provide that the reincorporation
merger of the CBOT with and into Delaware NFP CBOT will not have any effect on
any rights related to the CBOE, including, without limitation, the rights
provided in Rule 210.00 (which sets forth the Full Member CBOE exerciser
privilege), held by any person or entity holding any membership or other
interest in Delaware NFP CBOT. As described elsewhere in this document, the CBOE
has raised an issue regarding whether the restructuring will invalidate the CBOE
exercise right. Notwithstanding the issue raised by the CBOE, based on our
assessment of CBOE's concerns as expressed in its written correspondence to the
CBOT to date, we do not believe that the restructuring, including step one of
the restructuring as proposed in this document, will have any impact on the CBOE
exercise right. We cannot assure you, however, that the CBOE will not raise
additional issues, nor can we assure you as to the outcome of our disagreement
with CBOE with respect to this or any other additional issues.

New Classes of Members or Memberships

Currently, it would be necessary to adopt a new Rule in order for the CBOT to
create a new class of member, membership or other interest holder in the CBOT.

In order to preserve future flexibility in this regard for Delaware NFP CBOT,
the Delaware NFP Charter will expressly permit the creation of one or more
additional classes of members, membership or other interests.

Differential Voting Rights

Currently, Full Members of the CBOT are entitled to vote on each matter eligible
to be voted on by the membership. Currently, Associate Members of the CBOT are
entitled to one-sixth of the vote of a Full Member on each matter which is the
subject of a ballot vote of the general membership. Holders of GIM, COM and IDEM
Membership Interests in the CBOT do not currently have voting rights on any
matter which is the subject of a ballot vote of the general membership.

Generally, the DGCL provides that each member of a Delaware nonstock corporation
shall be entitled to one vote, unless otherwise provided in the corporation's
certificate of incorporation. The Delaware NFP Charter will provide that Full
Members of Delaware NFP CBOT are entitled to one vote on each matter eligible to
be voted on by the membership and Associate Members of Delaware NFP CBOT are
entitled to one-sixth of one vote on each matter eligible to be voted on by the
membership. The Delaware NFP Charter will further provide that holders of GIM,
COM and IDEM membership interests in the Delaware NFP CBOT are not entitled to a
vote on matters eligible to be voted on by the membership.

<PAGE>

Other than a technical provision to clarify that Full Members have one vote and
Associate Members have one-sixth of one vote on all matters submitted to the
membership for a vote, the differential voting rights of members and membership
interest holders will be the same in Delaware NFP CBOT as they currently are in
the CBOT.

Special Votes Required for Certain Actions

Current Rights of Members Regarding Amendment of the Special Charter and
Rules: The Petition Process

Currently, the CBOT's special charter may only be amended in accordance with the
applicable provisions of the Special Charter Act.

The Special Charter Act permits amendment of a corporation's special charter
only for certain specified purposes. These include, among other things: to
change its name, to change its place of business, to enlarge or change the
object for which it was formed, to enlarge or change its powers in respect of
owning, holding or using real or personal property or any other of its powers,
to vest in a single governing body of trustees, directors or managers the
corporate powers and other powers previously vested in two or more governing
bodies, to provide the method of electing members of such governing body and
their terms of office, to empower such governing body to elect a chairman and
any other officers and to appoint committees, from its members, with such duties
and powers as may be assigned and delegated thereto by the governing body, to
recognize and give effect to changes in the name of any religious denomination
or other organization with which such corporation, association or society is
affiliated, or to increase or decrease the number of its trustees, directors, or
managers, as now authorized or may hereafter be authorized by general law, or to
elect its trustees, directors or managers without the approval or ratification
of the religious denomination or other organization specified in its special
charter, where the representatives of such religious denomination or other
organization shall have waived and relinquished such right of consent, approval
or ratification to the election of its trustees, directors or managers.

Under the Special Charter Act, the CBOT may amend its charter in the following
manner: (i) first, the directors must adopt a resolution setting forth such
amendment; and (ii) second, if the directors are elected, such resolution must
be adopted by such vote, approval or consent of the persons entitled to elect or
choose such directors as is required in such election. Under the CBOT's Rules
and Regulations, a plurality of votes is generally required to elect directors
of the CBOT. Thus, in the case of an amendment to the CBOT's special charter, a
plurality (which, in the case of only a "for-or-against" vote, would mean a
majority) vote of the votes cast by the voting members in accordance with their
respective voting powers would be required.

Currently, the CBOT Rules and Regulations may be amended, altered or repealed as
provided therein. New Rules may be adopted and existing Rules may be amended or
repealed by the membership. Proposed amendments may be recommended by the Board
of Directors of the CBOT, and, upon such recommendation, the Chairman of the
Board must call for a special ballot

<PAGE>

not less than 10 days or more than 60 days after the proposed amendment has been
posted on the bulletin board. All votes are cast by secret ballot. Unless 300
votes are cast, the vote is ineffective, and the Chairman of the Board must in
such case call for another special balloting for the resubmission of the
proposal. If 25 members or more petition for any proposed amendment, the Board
of Directors of the CBOT, within 30 days or at the next regular Board meeting
(whichever is sooner) shall either approve and recommend the proposed amendment,
or report to the petitioners the reason for its disapproval.

If, within 30 days after such disapproval, 100 members or more petition for such
proposed amendment, a special balloting must be called for in a like manner as
though the proposed amendment had been recommended by the Board of Directors.
This provision has been interpreted by the Board to direct the Chairman upon
receipt of a qualifying petition, and without the necessity of any further
action by the Board, to call for a special ballot on the amendment proposed by
the petition: (i) not less than 10 or more than 60 days after the proposed
amendment has been posted on the bulletin board; (ii) by secret ballot; (iii) to
only be effective upon the casting of 300 or more votes; and (iv) to be
resubmitted to the membership for another special balloting if less than 300
votes are cast. In connection with this process, the Board is not precluded from
taking and stating a position in opposition to such a proposed amendment. Also,
this provision does not transform a petition proposal into a Board
recommendation without further action or consent by the Board.

A petition for amendment which in the opinion of the Board of Directors involves
the same or substantially the same subject matter as has been submitted to an
effective ballot vote of the membership at any time within the 12 months
immediately preceding the receipt of such petition by the Board requires the
signatures of at least 100 members. The Board must within 30 days or at the next
regular Board meeting (whichever is sooner) either approve and recommend such
proposed amendment, or report to the petitioners the reason for its disapproval.
If, within 30 days after such disapproval, 250 members or more petition for such
proposed amendment, a special balloting shall be called for in a like manner as
though the proposed amendment had been recommended by the Board of Directors,
and it requires an effective affirmative vote of two-thirds of the votes cast in
order to adopt such an amendment.

Every petition for amendment must be signed and dated by each petitioning
member. It is considered an act detrimental to the welfare of the CBOT for any
member to sign a petition for a ballot vote on an amendment despite disapproval
of such amendment by the Board unless and until the Board shall actually have
disapproved of such amendment.

During the period of posting, any proposed amendment may be amended by the
majority vote of the CBOT at a special meeting held for the purpose of
considering such amendment. If the proposed amendment is thus amended, the
amended amendment shall then be posted for 10 days before submission to the
membership for balloting.

Any proposition which the Board of Directors orders submitted to a vote of the
members (including an amendment to the special charter or any other proposition
required to be submitted to a vote of the members), without calling a special
meeting of the members, may be so submitted as follows (except as may be
otherwise required by the Rules and Regulations). Up to

<PAGE>

five propositions may be submitted concurrently to such a vote of the members.
In submitting any proposition to a vote of the members, the Board shall adopt a
resolution setting forth such proposition, recommending its adoption and
ordering it to be submitted to a vote of the members. Then, the Chairman of the
Board must cause such proposition to be posted upon the bulletin board and,
without calling a special meeting of members, must call for a special ballot
upon the proposition on a day to be fixed by the Chairman. This day must not be
less than 10 days or more than 60 days after the proposition has been posted
upon the bulletin board. A notice of the time and manner of casting such special
ballot must be given by mail to each member at least 10 days in advance of the
date upon which such special ballot is to be taken. A form of ballot setting
forth the proposition to be voted upon and providing an appropriate space for
use by the member in voting "for" or "against" the proposition must be supplied
to each member. The manner of taking such special ballot of the members is the
same as that prescribed in the conduct of elections, including the provisions
for voting by mail. Any such proposition thus submitted to a vote of the members
shall be deemed adopted if at least 300 votes are vast in the special ballot and
a majority of the votes cast have been in favor of adoption of the proposition.

Special meetings of the members may be called by the Board of Directors or by
the Chairman of the Board. Upon written request of 25 members, the Secretary is
required to call a special meeting. Not less than three days notice of such
special meetings must be given by the Secretary, either by announcement on
Change or by written notice. Calls for special meetings must state the objects
thereof and no other business may be considered except by unanimous consent.

These procedures are currently set forth in the CBOT's Rules and Regulations,
including Rules 107.00 (Amendment of Rules) and the Interpretation thereof,
108.00 (Amendment of Amendment of Rules), 109.00 (Other Propositions for Vote by
Members) and 111.00 (Special Meetings of Members). These Rules, together with
certain other provisions of the Rules and Regulations (including those relating
to the nomination procedures for elective officers and the annual election),
constitute what is sometimes referred to as the "petition process" of the
members of the CBOT.

This petition process effectively vests in the voting membership the authority
to adopt, amend and repeal Rules, which generally govern the rights and
obligations of the members of the CBOT. This is a special right of the members
of the CBOT which will change in connection with the reincorporation of the CBOT
in Delaware. Although this right will change is some significant respects
(particularly in terms of the procedures and mechanisms used to implement such
right under Delaware law), we believe that the special authority vested in the
members under the petition process will be substantially preserved in all
material respects in connection with step one of the restructuring, as described
further below.

Amendment of Delaware NFP Charter and Bylaws: Delaware Alternative to the
Petition Process

The "petition process" as described above is not expressly recognized under
Delaware law. However, the Delaware NFP Charter and Bylaws will include
provisions designed to provide

<PAGE>

substantially similar authority to the members with respect to amendment of the
Bylaws (which, as noted above, will incorporate a substantial portion of the
existing CBOT Rules).

As a substitute for the petition process, the Delaware NFP Charter (in Exhibit
A) will provide that all amendments of the Bylaws (which will include those CBOT
Rules applicable to Delaware NFP CBOT) will require the approval of members
holding a majority of the voting power of Delaware NFP CBOT voting at a special
meeting called for such purpose in accordance with the applicable provisions of
the Delaware NFP Charter. In addition, the Delaware NFP Charter will provide
that, subject to certain conditions, a special meeting of members for purposes
of voting on an amendment to the Bylaws, will be called by the Board at the
request of 25 voting members. The Delaware NFP Charter will permit "proxy
ballot" voting on such propositions, as described below at "Voting Procedures."
The Bylaws will provide that, except as otherwise provided in the Delaware NFP
Charter (i.e., members' rights to cause meetings to be called for the purpose of
considering amendments of the Bylaws) special meetings of the members for any
purpose may only be called by the Board or the Chairman of the Board.

The Delaware NFP Charter will also provide that the provisions of the Delaware
NFP Charter and the exhibits thereto 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 provided
for therein, as described above. As a result, member approval will be required
in order to change any of the terms or provisions of the Delaware NFP Charter.
You should be aware that, in accordance with the DGCL, Board approval will be
required for all amendments to the Delaware NFP Charter. Thus, because certain
provisions which currently exist in the CBOT Rules and Regulations have been
moved from the Rules and Regulations into the Delaware NFP Charter consistent
with the DGCL, both Board and member approval will be required to amend, alter
or repeal such provisions.

We believe that these rights substantially replicate, in all material respects,
the authority currently vested in the members pursuant to the current petition
process, in accordance with the requirements and to the extent permissible under
the DGCL. These provisions are materially different from those contained in the
current CBOT Rules and Regulations in light of the requirements of applicable
Delaware law, including, but not limited to, the requirement of Board approval
for charter amendments, and you should carefully review and consider these
provisions of the Delaware NFP Charter before voting on step one of the
restructuring.

Change to For-Profit Status

As described above, any amendment, alteration or repeal of Article Fourth of the
Delaware NFP Charter, which provides that Delaware NFP CBOT is not for profit
and has no authority to issue capital stock, will require, in addition to Board
approval, the affirmative vote of the holders of a majority of the voting power
of Delaware NFP CBOT voting at a meeting of members called by the Board for such
purpose in accordance with the applicable provisions of the Delaware NFP
Charter.

It is currently contemplated that the amendment of the Delaware NFP Charter to
provide that For-Profit CBOT will have for-profit status and the ability to
issue capital stock will be

<PAGE>

submitted to the members as a part of a membership vote in connection with a
subsequent step of the restructuring.

For more information concerning subsequent steps of the restructuring, see
"Restructuring Implementation" above.

Amendments to Regulations

The Delaware NFP Charter will authorize the board of directors to amend, alter
and repeal the Regulations (including Interpretations, as described below)
without membership approval.

Merger, Sale, Other Significant Transactions and Dissolution

In accordance with the DGCL, the approval of members holding a majority of the
outstanding voting power is necessary to approve a merger or consolidation, a
sale, lease or exchange of all or substantially all of Delaware NFP CBOT's
assets, or the dissolution of Delaware NFP CBOT.

Voting Procedures

Currently, the CBOT Rules and Regulations provide for a special ballot process,
which includes the right of members to vote by mail. In addition, as described
above, under the current CBOT Rules and Regulations, members may petition to
have any proposed amendment to the Rules considered by the Board and submitted
to the membership for approval and, under certain circumstances when approval
from the Board is withheld, such amendments may be submitted directly to the
membership for approval.

Members will no longer be able to act by the specific voting by mail, special
ballot and petition procedures currently provided in CBOT Rules 105.00, 107.00
and 109.00 in the same manner they are accustomed to. Instead, in accordance
with the DGCL and the provisions of the Delaware NFP Charter, Bylaws and
Regulations, the members of Delaware NFP CBOT will be able to exercise their
voting rights, either in person or by proxy, at a membership meeting or by
taking action by written consent as permitted by the DGCL. This is a material
change from the current Rules and Regulations of the CBOT, which generally
prohibit proxy voting except in certain specified circumstances. You should
carefully review, therefore, these provisions of the Delaware NFP Charter and
Bylaws before voting on step one of the restructuring.

The Delaware NFP Charter and Bylaws will provide, however, for proxy procedures
designed to substantially replicate, as permitted under the DGCL, the voting by
mail procedures of the CBOT.

Specifically, 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 ballot" to the Secretary or one or more other persons designated by the
board of directors of Delaware NFP CBOT and directing them how to vote. Any
member who so desires may mark and execute the proxy ballot and deliver or mail
it to the Secretary. The Secretary or other persons designated by the board of

<PAGE>

directors 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 Secretary shall cast one or more ballots to vote, as proxy, as
directed in the proxy ballots.

The latest dated proxy ballot of a given member delivered or received by mail
shall be the proxy ballot followed by the Secretary with respect to such member.
A member can revoke a proxy ballot by voting in person.

The Delaware NFP Charter will not contain any provision prohibiting the taking
of action by written consent. It will be permissible, therefore, for any action
which may be taken at any meeting of the members to be taken without a meeting,
without prior notice and without a vote, if a consent or consents in writing,
setting forth the action so taken, is signed and delivered in accordance with
the requirements of the DGCL by members having not less than the minimum number
of votes that would be necessary to authorize or take such action at a meeting
at which all members having a right to vote thereon were present and voted.

Liquidation and Dissolution

Currently, in the event of the liquidation of the CBOT, Associate Members and
holders of GIM, COM and IDEM membership interests are entitled to share in the
proceeds from dissolution at a rate of 1/6, 0.11, 0.005 and 0.005 of a Full
Member's share, respectively.

Under the DGCL, and the applicable provisions of the Delaware NFP Charter,
Bylaws and Regulations, members and membership interest holders will have the
same rights to distributions upon dissolution and liquidation as they had under
CBOT, subject to the requirements of the DGCL regarding such distributions,
including, but not limited to, provisions related to the obligation to pay or
make reasonable provision to pay claims of creditors prior to making any
distribution to stockholders or, by analogy, members.

Board of Directors; Officers

Currently, the CBOT's board consists of 27 members, which includes the Chairman
of the Board, the First Vice Chairman of the Board, the Second Vice Chairman of
the Board, the President of the CBOT (who serves as a non-voting member of the
Board), 15 elected directors, who shall be Full Members and of whom at least
three shall be nonresident, five non-member directors nominated by the
Nominating Committee and approved by the CBOT Board, and three directors who
shall be Associate Members.

The provisions of the CBOT Rules and Regulations relating to the CBOT Board,
certain of its officers and the powers and obligations of its members will be
imported, substantially without change, into the Delaware NFP Charter and
Bylaws.

Accordingly, Delaware NFP CBOT's board of directors will continue to have 27
members, consisting of the Chairman of the Board, the First Vice Chairman of the
Board, the Second Vice

<PAGE>

Chairman of the Board, the President of the Association (who serves as a non-
voting member of the board of directors), 15 elected directors, who shall be
Full Members and of whom at least three shall be nonresident, five non-member
directors nominated by the Nominating Committee and approved by the Board, and
three directors who shall be Associate Members.

All directors and officers of the CBOT as of the effective time of the
reincorporation merger will remain the directors and officers of Delaware NFP
CBOT, and their terms and tenures will continue and be unaffected by the merger.

Indemnification and Protection From Liability

Currently, the CBOT's Rules and Regulations generally provide that directors,
officers and employees shall be indemnified against certain liabilities,
expenses, counsel fees and costs in connection with any claim to which such
person is a party by reason of his or her being or having been a director,
officer, committee member or employee of CBOT. However, directors, officers and
employees shall have no right to indemnification in respect of any matter as to
which he or she is finally adjudged to have been derelict of duty or guilty of
gross negligence or willful misconduct in the performance of his or her duties.
If any such claim is settled before final judgement or if there is no finding in
respect of any dereliction of duty or guilt of willful misconduct or gross
negligence in the performance of duty of the director, officer or employee, such
person is entitled to indemnification only upon a determination in good faith by
a majority of the board of directors that such claim did nor arise out of the
dereliction of duty or guilt of willful misconduct or gross negligence in the
performance of his or her duty.

The indemnification for directors, officers and employees provided in the CBOT
Rules and Regulations will be replaced by a provision in Delaware NFP CBOT's
Bylaws requiring mandatory indemnification and advancement of expenses for
directors, officers, committee members and employees to the fullest extent
authorized by the DGCL, subject to certain limitations stated in Delaware NFP
CBOT's Bylaws. The Delaware NFP Charter will include a provision, authorized by
Section 102(b)(7) of the DGCL, which eliminates the personal liability of
directors to Delaware NFP CBOT or its members for monetary damages for breach of
fiduciary duty to the fullest extent permitted by the DGCL. This provision
generally shields directors from potential personal liability for a good faith
breach of the duty of care, although it does not protect them from potential
liability for breach of the duty of loyalty and certain other acts.

Telephonic Board Meetings

Currently, the CBOT's Rules and Regulations provide that the members of the
Board may be separately polled by telephone to vote on issues requiring action
prior to the next regularly scheduled Board meeting and where the calling of a
special meeting, in the opinion of the Chairman or the President, would be
impractical. A telephone poll reaching 12 or more members of the Board is
sufficient to constitute a quorum.

<PAGE>

The Bylaws of Delaware NFP CBOT will provide that telephonic meetings of the
board of directors may be conducted, but will not include a provision for
telephone polling of directors. Telephone polling is being eliminated in favor
of telephonic meetings of the board of directors in order to ensure a
deliberative board process as required under modern corporate governance
principles.

Inspection Rights

Currently, under applicable Illinois law, it is uncertain as to whether members
have a general right to inspect the list of members and other books and records
of the CBOT.

Under the DGCL, and subject to the requirements and conditions thereof, any
member may seek to inspect during normal business hours Delaware NFP CBOT's list
of members and other books and records for a "proper purpose" reasonably related
to such member's interest as a member.

Certain Other Changes

Certain other changes and clarifications are being made to the provisions of the
Delaware NFP Charter, the Bylaws and the Regulations in order to modernize and
streamline its corporate governance.

An example of such a change includes the elimination of a provision expressly
requiring that, in cases of dispute, Robert's Rules of Order shall govern the
conduct of meetings of the Board and members. An example of such a clarification
is a provision allowing the Board to adopt from time to time Interpretations
(which will be deemed to be Regulations) for purposes of interpreting the
Delaware NFP Charter, Bylaws and Regulations.

Except as otherwise described herein, we believe that these changes are largely
procedural and administrative in nature and that they are not material to the
rights and obligations of CBOT members and membership interest holders.

Elimination of Special Charter

After the reincorporation of the CBOT in Delaware as Delaware NFP CBOT, the
CBOT's current special charter will no longer exist. Instead, it will be
replaced by the Delaware NFP Charter. This document, together with the Bylaws
(which will incorporate substantial portions of the current CBOT Rules) and
substantial portions of the current Regulations which will become applicable to
Delaware NFP CBOT, will define your rights and obligations as members and
membership interest holders in Delaware NFP CBOT. Before voting on step one of
the restructuring, you should review carefully the forms of the Delaware NFP
Charter and the Bylaws, which will be attached as exhibits to the Ballot
Disclosure, because they will define your rights and obligations as members and
membership interest holders in Delaware NFP CBOT.

<PAGE>

Repeal of Certain Rules and Regulations

After the reincorporation of the CBOT in Delaware as Delaware NFP CBOT, the CBOT
Rules and Regulations, including the Interpretations thereof, will no longer
exist in their current form. Instead, they will be replaced by the Bylaws, which
will incorporate by reference substantial portions of the current Rules, and
those Regulations applicable to Delaware NFP CBOT, which will consist of
substantial portions of the current CBOT Regulations.

However, in order to reincorporate the CBOT in Delaware as Delaware NFP CBOT and
comply with the requirements of the DGCL, a number of provisions of the CBOT's
Rules and Regulations, including the Interpretations thereof, are being repealed
or eliminated in their entirety. This is because (i) they will be expressly set
forth in the Delaware NFP Charter and/or the Bylaws in accordance with the
requirements of the DGCL, (ii) they will be replaced with different provisions
in the Delaware NFP Charter and/or Bylaws designed to achieve a substantially
similar effect under the DGCL or to modernize the corporate governance of
Delaware NFP CBOT as described in this document, and/or (iii) they may not be
enforceable under or consistent with the DGCL.

All of the CBOT Rules and Regulations, including the Interpretations thereof,
which will either be expressly set forth in the Delaware NFP Charter and/or the
Bylaws (in some cases, with certain modifications as described above or
otherwise) or which will be eliminated entirely as part of the reincorporation
of the CBOT in Delaware as Delaware NFP CBOT will be identified in an exhibit to
the Ballot Disclosure. In addition, the forms of the Delaware NFP Charter and
the Bylaws attached as exhibits to the Ballot Disclosure will be annotated to
indicate those CBOT Rules and Regulations which are being expressly imported in
substance into such documents. You should review carefully those exhibits before
voting on step one of the restructuring.

In all cases, these Rules and Regulations, including the Interpretations
thereof, will, from and after the effective time of the reincorporation merger,
be null and void and have no further force or effect for any purpose whatsoever.
All such Rules and Regulations, including the Interpretations thereof, will be
deleted from the first edition of the Rulebook of Delaware NFP CBOT, which shall
be published as soon as reasonably practicable following the implementation of
step one of the restructuring. Also, the special charter will be deleted from
such new Rulebook.

The new Rulebook of Delaware NFP CBOT will include copies of the Delaware NFP
Charter, the Bylaws, the Rules and the Regulations. Copies of this new Rulebook
will be made available to members and membership interest holders in accordance
with past practice.

<PAGE>

Certain Interpretations

The Board of Directors of the CBOT currently intends to adopt, in connection
with the implementation of step one of the restructuring, a Regulation
permitting it to issue Interpretations (which will be deemed to be and have the
effect of Regulations) of the Delaware NFP Charter, the Bylaws and Regulations
in a manner which replicates, to the largest extent permissible under the DGCL,
the comparable provisions of the current CBOT Rules and Regulations, except as
otherwise described herein.

<PAGE>

THE MEETINGS OF MEMBERS

The First Member Vote

As described above in the Section entitled "Restructuring Implementation -
Reincorporation of the CBOT into a Delaware For-Profit Corporation," step one of
the restructuring involves three distinct legal actions:

(1) the election by the CBOT to accept the NFP Act (the "Election"),

(2) the related amendment to CBOT's special charter in accordance with the
requirements of the NFP Act (the "Amendment"), and

(3) the merger of the CBOT with and into Delaware NFP CBOT (the "Merger"),
as set forth in the Agreement and Plan of Merger which is attached to
the Ballot Disclosure.

Each of the legal actions associated with step one of the restructuring (i.e.,
the Election, Amendment and Merger), will require approval by the CBOT members
entitled to vote in order to proceed with the proposed restructuring. So that
CBOT members may vote on all matters involved in step one of the restructuring
at the same time (even though, as a legal matter, the various intermediate steps
will occur in sequence), an integrated approach to voting is being presented.
This integrated approach involves the use of both regular and proxy voting.

As a result of certain legal requirements of the NFP Act concerning the process
utilized to conduct a vote by members on the Merger, the Board has adopted a
Regulation that provides for proxy voting in connection with a special meeting
of members called for the purpose of considering the Merger. Regulation 111.01
permits the use of the enclosed integrated special ballot/proxy card that serves
the purpose of a special ballot with respect to the Election and Amendment and
serves as a proxy with respect to the Merger.

Accordingly, it is currently expected that a special ballot vote of the
membership will occur in late June 2000 (the "Special Ballot Vote"). At the
conclusion of the Special Ballot Vote, the special ballot/proxy cards will be
counted with respect the Election and the Amendment. Assuming 300 votes are cast
and the required vote of two-thirds of the votes cast by members present and
entitled to vote approve the Election and the Amendment, the Election and
Amendment would be deemed adopted by the membership and the CBOT would amend its
special charter and elect to accept the NFP Act.

In addition, a special meeting of the membership will be held about a week later
(the "Proxy Vote"). At the conclusion of the Proxy Vote, the special
ballot/proxy cards will be counted with respect to the Merger. Assuming a quorum
of 100 members is present and the required vote of two-thirds of the votes
present and voted either in person or by proxy to approve the Merger is
achieved, the CBOT would take appropriate steps to consummate the Merger as
promptly as practicable thereafter, following confirmation that the CFTC has no
objection to the

<PAGE>

implementation of step one of the restructuring, as described below under "CFTC
Regulatory Matters."

With respect to each member, the latest special ballot/proxy card received by
mail prior to the conclusion of the Special Ballot Vote shall be the special
ballot/proxy card counted by tellers with respect to the Election and Amendment
unless the member subsequently votes in person at the poll, in which case, a
special ballot/proxy card cast in person with respect to the Election and
Amendment shall negate all previous special ballot/proxy cards by that member.
The latest special ballot/proxy card received by mail prior to the conclusion of
the Proxy Vote shall be the special ballot/proxy card counted with respect to
the Merger unless the member subsequently votes in person at the poll, in which
case, a special ballot/proxy card cast in person with respect to the Merger
shall negate all previous special ballot/proxy cards by that member; provided,
however, that in no event shall a member have the power to change or otherwise
revoke a special ballot/proxy card delivered and counted in connection with the
Election and Amendment following the conclusion of the Special Ballot Vote. For
your consideration, we discuss below each of the steps involved in step one of
the restructuring.

Election to Accept the NFP Act

The NFP Act provides that any not-for-profit corporation without shares of
capital stock created by a special act of the Illinois Legislature, such as the
CBOT, may elect to accept the NFP Act. An election to accept and be governed by
the NFP Act requires an electing corporation's board of directors to adopt a
resolution recommending that the corporation elect to accept the NFP Act, which
the Board has adopted on or prior to the date of these ballot materials, and
directing that the question of such acceptance be submitted to a vote of the
members.

In addition, the NFP Act specifies certain procedural requirements that must be
satisfied in connection with such an election. However, because the Election
will be made while the CBOT is still governed by the Special Charter Act, that
Act was also considered in determining the requisite procedure by which the CBOT
may adopt and approve the Election.

The Special Charter Act does not contain a procedure for approving most forms of
corporate action, including an election to accept the NFP Act. Although the NFP
Act specifies a procedure for approving an election to accept the Act, it also
contemplates alternative procedures, provided such procedures are authorized by
a corporation's charter or by-laws. The current Rules and Regulations should be
deemed bylaws for these purposes and therefore the special ballot procedure
provided for in the CBOT Rules and Regulations should be an acceptable procedure
for voting on the Election.

Amendment of Special Charter

The CBOT's special charter does not contain certain provisions that the NFP Act
requires to be set forth in the articles of incorporation of a corporation
organized under the NFP Act. Accordingly, while this is a somewhat technical
matter, the CBOT's special charter must be amended to include certain additional
information, such as the purposes for which it is organized

<PAGE>

(which are currently set forth only in the preamble to the CBOT Rules &
Regulations) as well as the address of its registered office and the name of its
initial registered agent at that office.

The Special Charter Act provides that a corporation may amend its special
charter as follows: first, the directors shall adopt a resolution, which the
Board has adopted on or prior to the date of these ballot materials, and then,
if the directors were elected by the members, such resolution shall be submitted
to the members for adoption by the same vote, approval or consent as that
required to elect the directors, which, in the case of the CBOT, is a majority
(plurality) of the votes cast, assuming a quorum.

The Special Charter Act does not specify the procedure by which such member vote
is to be taken, including whether the vote must occur at a meeting of the
members or otherwise. However, the Special Charter Act is a flexible statute
that should accommodate a range of procedures for member votes in this context,
provided that such procedures are authorized in or allowed by the special
charter. The CBOT's special charter and the CBOT Rules and Regulations
specifically authorize the use of the special ballot process for the amendment
of the CBOT's special charter and, therefore, the special ballot procedure will
comply with the Special Charter Act.

Merger of CBOT into Delaware NFP CBOT

The NFP Act provides that any two or more corporations may merge into one such
corporation or consolidate into a new corporation, including the case of a
domestic (i.e., Illinois) corporation merging into a foreign (e.g., Delaware)
corporation, provided that the foreign corporation is a not-for-profit
corporation and such merger is permitted by and complies with the laws of the
State under which such foreign corporation is organized. The NFP Act further
provides that the board of directors shall adopt a resolution approving a plan
of merger, which the Board has adopted on or prior to the date of these ballot
materials, and directing that it be submitted to a vote of the members at a
meeting of members entitled to vote on mergers.

The NFP Act requires that the proposed plan of merger be approved and adopted by
the affirmative vote of at least two-thirds of the votes present and voted
either in person or by proxy. The Merger must be accomplished after the CBOT has
elected to accept and be governed by the NFP Act. Thus, in contrast to the
provisions of the NFP Act related to the Election and the Amendment, the CBOT
must conduct a member vote on the Merger in a manner provided by the NFP Act.

In order for the Merger approval to be effective, the NFP Act requires that the
approval be obtained either at a special (or annual) meeting or by written
consent. The NFP Act does not expressly provide for alternative procedures, such
as the special ballot and vote-by-mail procedures, for this purpose. As
described above, in order to comply with the requirements of the NFP Act, the
Board has adopted a regulation that clarifies the voting procedure in connection
with special meetings of the members. Pursuant to Regulation 111.01, proxy
voting will be permitted in connection with the Merger vote utilizing the
previously described combination ballot/proxy process.

<PAGE>

Delaware NFP CBOT may approve the Merger by submitting a plan of merger to its
board of directors for approval by a two-thirds vote. Accordingly, the board of
directors of Delaware NFP CBOT prior to the Merger (who would be appointed by
the CBOT) would have authority to approve the Merger on behalf of Delaware NFP
CBOT. After the requisite approval is obtained, a certificate of merger would be
filed with the Secretary of State of the State of Delaware, which would include
the Certificate of Incorporation of Delaware NFP CBOT and a corresponding filing
of articles of merger would be made with the Secretary of State of the State of
Illinois.

Subsequent Member Votes

At this time, members are only being asked to approve and to vote on the first
step of the restructuring, which will result in the CBOT being reincorporated in
Delaware as a nonstock, not-for-profit corporation. One or more subsequent
member votes, which will present for your consideration the remaining steps of
the restructuring, will be called for by resolution of the board of directors of
Delaware NFP CBOT and be conducted in accordance with Delaware NFP CBOT's
Certificate of Incorporation, Bylaws, Regulations and the DGCL. Pursuant to the
terms and provisions of the Certificate of Delaware NFP CBOT, any amendment to
the article of the Delaware NFP Certificate of Incorporation providing that
Delaware NFP CBOT is not-for-profit and shall have no authority to issue capital
stock requires the approval of members holding a majority of the voting power of
Delaware NFP CBOT present in person or represented by proxy. In connection with
your consideration of the subsequent member votes, you will receive additional
disclosure regarding the subsequent steps of the restructuring. Subsequent
membership approvals necessary to authorize the overall restructuring strategy
are currently expected to be solicited by the end of 2000.

Although we currently intend to obtain the final member approval by the end of
2000 and thereafter implement the subsequent steps of the restructuring plan as
described herein, we are not obligated to do so and we cannot assure you as to
whether or when the subsequent membership approval will occur and whether or
when the subsequent steps of the restructuring will be implemented. This means
that we cannot assure you that we will obtain the expected benefits of the
subsequent steps of the restructuring described herein or as to the timing of
any such benefits.

<PAGE>

SECURITIES LAW ISSUES

No securities are being offered in connection with step one of the
restructuring. Thus, the special ballot/proxy disclosure materials provided in
connection with step one of the restructuring do not constitute a prospectus
under the Securities Act of 1933, or any applicable state law. Any offering of
the securities described herein will be made only by means of a prospectus that
meets the requirements of the Securities Act and constitutes a part of a
registration statement which has been declared effective by the SEC. Additional
information related to securities law issues relating to the restructuring will
be provided to you in connection with a subsequent member vote.

TAX CONSIDERATIONS

For U.S. federal income tax purposes, the conversion of the CBOT into Delaware
NFP CBOT should be treated as a mere change in its form and place of
incorporation. A reorganization that constitutes a mere change in the CBOT's
form and place of incorporation should be tax-free both to the CBOT and its
members and membership interest holders. Members and membership interest
holders, however, are urged to consult their own tax advisors concerning the
Federal, state, local and foreign tax consequences to them of step one of the
restructuring.

The CBOT will seek a ruling from the IRS as to the tax-free nature of the
separation of the electronic trading company and other potential transactions
contemplated in the subsequent steps of the proposed restructuring. You will
receive additional information regarding the material U.S. federal income tax
consequences of subsequent steps of the restructuring in connection with your
vote on such matters.

CFTC REGULATORY MATTERS

At different stages of the restructuring plan, certain regulatory issues may be
raised. While no one can predict with certainty the response of the CFTC to each
of these issues as they arise, management and legal counsel are engaged in a
process of consultation that should ameliorate any areas of concern.

For example, the CFTC has been advised that, as part of step one of the
restructuring, a for-profit wholly-owned subsidiary of the CBOT will be formed
to operate the electronic trading business of the CBOT and will trade all
existing CBOT contracts electronically. All of these contracts will still trade
under the legal authority of the CBOT consistent with its existing contract
market designations. The electronic trading company will not seek to obtain its
own initial contract market designation status from the CFTC until the
separation of the electronic trading company contemplated in the final steps of
restructuring. At that time, the electronic trading company will, as an
independent company, need to obtain CFTC contract market designations and assume
all appropriate self-regulatory responsibilities as a new electronic exchange.

Those aspects of step one of the restructuring that may have an effect on the
Rules and Regulations must be submitted to the CFTC before step one of the
restructuring can be

<PAGE>

completed. We currently expect that the CFTC will not raise any objections to
step one of the restructuring, so that step one may be implemented as soon as
practicable following approval by the members in this member vote.

The CFTC also has been advised that the shift to a for-profit, business-oriented
operational approach will not diminish the CBOT's capacity to maintain its high
standards of market and financial integrity through effective enforcement of its
rules. Some concern has been expressed by SEC Chairman Arthur Leavitt, among
others, that for-profit exchanges are incompatible with the ideal of vigorous
self-regulation since those exchanges may find their self-regulatory incentives
to be compromised by their new for-profit business orientation. If the CFTC
adopted that policy and prevented any for-profit entities from acting in a self-
regulatory capacity, both the CBOT and the electronic trading company's board of
directors would need to make certain adjustments to their business plans
consistent with the CFTC's policy. At this time, however, the CFTC has not
adopted that policy and discussions are underway with the CFTC to ensure that
the agency finds for-profit exchanges to be compatible with self-regulation.

In the course of implementing subsequent steps of restructuring, other
regulatory issues may arise relating to the independent yet cooperative nature
of certain of the CBOT's and the electronic trading company's activities. These
issues will be described more fully in connection with the subsequent member
votes.

<PAGE>

CONCLUSION

We believe that the future for CBOT members is full of opportunity. However,
divergent needs of members, competitive forces, advances in technology and the
evolution of the global derivatives market all are having an impact on how that
opportunity will be realized. The Board believes that this restructuring plan
offers the membership the best means to capitalize on that opportunity. It does
so by reorganizing the CBOT into a for-profit company focused exclusively on
updated open outcry trading and also reorganizing the CBOT's electronic trading
business into a for-profit company focused exclusively on electronic trading.

The existing mutual structure of the CBOT, which was designed over 150 years ago
in a different marketplace, no longer serves the greater interests of a majority
of its stakeholders. A more streamlined and flexible governance structure is
needed to allow the CBOT to react quickly to market developments. In addition,
having an equity structure that would provide both the CBOT and the reorganized
electronic trading company with a ready means of attracting strategic investors
and alliance partners will be increasingly important in the future.

By creating an updated open outcry company that is business-focused and
economically viable, the membership should benefit from the preservation of the
existing trading environment for as long as the market will support it. The
restructuring plan is also designed to preserve the ability to lease seats and
to exercise the right to trade at the CBOE.

For the large majority of CBOT members, the restructuring would provide a better
financial future the sooner it is adopted and activated. It is the determination
of the Board of Directors that maintaining the status quo would mean that both
open outcry and electronic trading run the risk of lackluster performance or
even failure.

The future of the derivatives industry is not certain. What is certain is that
this restructuring plan is designed to provide the membership with the best of
both worlds: a viable open outcry environment and a growing and valuable
electronic trading company. With the implementation of this restructuring plan,
we believe that the CBOT can position itself to lead the global marketplace for
the next 150 years.

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.

<PAGE>

[This screen may be accessed by clicking the "Restructuring Questions-Answers"
button on the Restructuring Screen.]

Chicago Board of Trade News & Views
--------------------------------------------------------------------------------

Restructuring Questions & Answers

The Impact of the First Ballot

. What did the Board approve in the May 16th CBOT Board of Directors meeting?

The Board approved the implementation of Step One of the restructuring, which
involves the reincorporation of the Chicago Board of Trade in Delaware as a
Delaware non-stock, not-for-profit corporation.

The Board also approved and adopted the overall restructuring strategy, as
described in the Restructuring Report of the Implementation Committee. The
Board has not yet approved the definitive terms of the transactions, which
would implement the remaining steps of the restructuring. The Board continues
to have the ability to pursue a different strategy depending upon the
circumstances existing at such time. However, the Board feels it is important
for the membership to understand the current direction of the restructuring
process.

The Board also approved and adopted the report of the Independent Allocation
Committee. This report contains recommendations on the allocation and the
methodology for an appropriate and fair allocation of value among the members
of the CBOT. The report of the Independent Allocation Committee was also
approved and adopted subject to any changes in the underlying facts or
assumptions that were used in the preparation of the report.

The remaining steps of the restructuring, including the allocation, are
subject to the Board's further review, consideration and approval. The Board
will only approve the terms of transactions that it determines are in the
best interests of the CBOT and its members and membership interest holders
and are fair to all classes of members and membership interest holders at
that time.

. What legal actions will the membership vote on as part of the first ballot?

The membership will be asked to vote on Step One of the restructuring, which
will result in the reincorporation of the CBOT in Delaware as a nonstock,
not-for-profit corporation. The specific legal actions involved in Step One
are the following:

. The CBOT's election to accept and be governed by the Illinois
General Not-For-Profit Corporation Act of 1986, as amended (the
"NFP Act");
. A related amendment to the CBOT's existing special charter to set
forth certain information required by the NFP Act; and
. The reincorporation merger of the CBOT into a newly formed Delaware
non-stock, not-for-profit corporate subsidiary of the CBOT. As a
result of this merger, the CBOT will become a Delaware nonstock,
not-for-profit corporation, with a new charter, bylaws, rules and
regulations.

<PAGE>

Each of these is an independent legal action requiring approval of the CBOT
members entitled to vote. THE CBOT does not intend to take any of these
actions separately without also taking each of the other actions. The CBOT
will seek member approval of all three actions pursuant to a single vote.

The ballot disclosure materials will contain more information about Step One
of the restructuring and the first member vote.

. Why is Step One of the restructuring being submitted to a vote of the
members at this time?

Step One is an essential part of the restructuring plan. Reincorporating in
Delaware will provide the CBOT with greater flexibility to implement other
aspects of the restructuring. Among other things, Delaware law would permit
the CBOT to later elect, after receiving appropriate member approval, to
become a for-profit corporation. This change to for-profit status, is
critical to implementing the overall restructuring. The Board also believes
that membership approval of and implementation of Step One will maintain
progress with respect to the implementation of the overall restructuring.

. What is the purpose of the Restructuring Report?

A significant amount of work has been undertaken to develop a plan of
implementation of the restructuring, which we believe is important to the
future of our exchange. The Board of Directors has approved and adopted the
Restructuring Report as the current formulation of the restructuring plan.
The Board believes it is important to communicate to the members its
progress to date and the overall restructuring plan to the membership. You
are not being asked at this time to approve the full restructuring strategy
as set forth in the report. Please remember that the first vote requests
only that you approve Step One of the restructuring, which will result in
the reincorporation of the Chicago Board of Trade in Delaware as a Delaware
nonstock, not-for-profit organization.

. If the ballot passes, what happens to the CBOE exercise right?

The Board fully intends to preserve the CBOE exercise right. The CBOT's
legal counsel has advised the Board that Step One does not raise any issues
under the 1992 agreement with the CBOE and thus should not impact the
exercise right. Legal counsel has also advised the Board that the 1992
agreement with the CBOE contemplates a restructured CBOT under certain
conditions. While the CBOE has communicated that it disagrees and has
suggested that it will contest trading access through the CBOE exercise
right subsequent to the restructuring plan, the Board and legal counsel
believe that the Board-approved plan complies with those conditions.

<PAGE>

. What impact does the allocation have on the ballot?

The allocation has no impact on the ballot. Allocation is not included as
part of the ballot. The allocation is included in the Restructuring Report
for informational purposes and will be part of transactions designed to
implement a subsequent step of the restructuring. Such subsequent steps
will be submitted to a member vote at a later time.

. Will there be a floor meeting?

All members are invited to attend a floor meeting on Thursday, May 25th at
2:30 p.m.

. Will members be able to provide input to the restructuring plan?

The Board of Directors welcomes all member input and encourages the entire
membership to reach out to the Board and Implementation Committee
informally and via various meetings, the hotline and email.

<PAGE>

Ballot Procedures

. When will members receive the ballot?

The ballot will be distributed to members as promptly as practicable.

. When will members vote?

It is currently expected that the member vote will be conducted in late
June.

. What is needed to pass the first vote?

The affirmative vote of at least two-thirds of the votes present and voted
either in person or by proxy is required to approve Step One of the
restructuring.

. If the membership passes the first ballot, when will Step One be
implemented?

Step One would be implemented as soon as practicable following approval in
the first membership vote, subject to confirmation that the CFTC has no
objection to any rule changes proposed in connection with the CBOT's
reincorporation in Delaware. We currently expect that the CFTC will not
raise any objections.

. When will members vote on the remaining steps of the overall restructuring
plan?

It is expected that one or more subsequent membership votes to implement
the remaining steps of the restructuring will take place later this year.

. What will the membership vote on in the ballot?

The membership will be asked to vote on Step One of the restructuring,
which will result in the reincorporation of the CBOT in Delaware as a non-
stock, not-for-profit corporation. The specific legal actions involved in
Step One are the following:
. The CBOT's election to accept and be governed by the Illinois
General Not For Profit Corporation Act of 1986, as amended (the
"NFP Act");
. A related amendment to the CBOT's existing special charter to set
forth certain information required by the NFP Act; and
. The reincorporation merger of the CBOT into a newly formed
Delaware non-stock, not-for-profit corporate subsidiary of the
CBOT. As a result of this merger, the CBOT will become a Delaware
non-stock, not-for-profit corporation, with a new charter, bylaws,
rules and regulations.

<PAGE>

Each of these is an independent legal action requiring approval of the CBOT
members entitled to vote. However, because the CBOT would not intend to take any
of these actions separately without also taking each of the other actions, the
CBOT will seek member approval of all three actions pursuant to a single vote.

The ballot disclosure materials will contain more information about Step One of
the restructuring and the first member vote.

<PAGE>

Development of the Restructuring Plan

. Who was involved with the development of the restructuring plan?

Beginning last summer, the Restructuring Task Force worked to develop a
recommendation to the Board regarding an overall restructuring strategy.
The Board adopted this recommendation in January. At that time, the Board
designated the Implementation Committee of the Board to work with
management and outside advisors to develop a plan to implement the
restructuring.

The Implementation Committee has worked with management consultants (A.T.
Kearney, Inc.), financial advisors (Merrill Lynch & Co.) and legal advisors
(Piper Marbury Rudnick & Wolfe as special counsel to the Implementation
Committee and Kirkland & Ellis as counsel to the CBOT and the Board of
Directors) to provide expertise in developing the best plan for
implementing the Board-approved restructuring strategy.

In addition, in January 2000, the Board also designated the Independent
Allocation Committee of the Board, comprised of four public directors, to
consider the allocation question, including the fairness issues associated
therewith. The Allocation Committee has worked with its own financial
advisors (William Blair & Company, LLC) and special counsel (Winston &
Strawn) in developing its recommendation.

Significant input from both members and management was obtained through
focus groups, individual conversations and email/MemberNet. The Board of
Directors was briefed on a regular basic and many Directors also met with
members of the Implementation Committee independently to provide input.

. Why does the CBOT need to restructure now?

The CBOT needs to make a decision now about its future. There is risk if we
adopt a "do nothing, wait and see" strategy. There are many external and
internal forces providing incentive for the CBOT to change. For example,
although we face increased competitive threats to our business, we have the
ability to arrange opportunities for critical strategic alliances to
capitalize on the growth of electronic trading if we restructure now. Based
on these factors and the Board's view of the future, the Board has
concluded that for the CBOT to be positioned to compete effectively in the
21st century, keeping the status quo is not a viable option.

Thus, a plan was designed to position members to benefit from both updated
open outcry and electronic trading. If the CBOT does not take this
opportunity, the value to the membership of any future restructuring
proposals could be less. It is believed the CBOT has an early mover
advantage that should be seized now.

<PAGE>

. What is the restructuring strategy?

The overall restructuring plan calls for the CBOT to demutualize and become
a for-profit company with a focus on updated open outcry trading. The
CBOT's electronic trading business, part of which is now operated by Ceres,
would be reorganized as a for-profit company focused exclusively on
electronic trading. Both entities would be for-profit, demutualized
companies. Current CBOT members would have ownership in both new
companies.

The electronic trading company would be focused on rapid growth, open
access, high earnings and the potential to become a publicly traded
company. It is our current intention to conduct an IPO if it is determined
to be the best way to unlock value for the membership. On an interim basis,
the electronic trading company would be operated as a for-profit subsidiary
of the CBOT.

The open outcry company is expected to remain closely held by the members
who would own equity in the company. The for-profit status and other
changes will allow for adoption of modern corporate governance procedures
and improved decision making and business focus. We currently expect that
the objective of this closely held corporation would be to use any retained
earnings to make investments in trading operations and technology, to lower
costs and to provide enhanced and more efficient trading opportunities.
However, as a for-profit company, it could declare dividends to its
members/stockholders if it chose to do so.

The restructuring plan contemplates that the for-profit CBOT and the
electronic trading company will offer all products currently offered by the
CBOT. The cooperative operating agreement will provide traders in the pit
access to the electronic platform and the "hit or take" functionality.

Step One is the first important step to implement this restructuring plan.

. Why is this plan the best solution for the CBOT?

The Board of Directors considered many other alternative plans and business
models before approving the current restructuring plan. This restructuring
plan is designed to provide the CBOT an opportunity to compete effectively
in the 21st century. It was determined there were no other alternatives
better able to provide value to the membership and to position the CBOT for
leadership in the future.

This solution was chosen because it best met the following criteria:
. Maximize membership value
. Helps to enable the CBOT to remain the center of liquidity for
its existing and new products
. Enhance the corporate governance structure

<PAGE>

. Best position the exchange for the future
. Can be successfully implemented
. Is fair to all classes of members and membership interest holders

. What is the expected valuation of the electronic trading company and what
assumptions were used in determining the valuation? Can you show the
membership what was presented to the Board?

In connection with its review of the proposed restructuring plan, the Board
of Directors received certain data on a range of possible valuations of the
electronic trading company. This valuation data is dependent on the
operating results of an entity that has not yet been formed, market
conditions and numerous other variables. In light of the highly tentative,
preliminary and subjective nature of such valuation data, and the fact that
assumptions regarding projected operating results are subject to change,
the Board of Directors believes that, at this time, release of any
valuation data with respect to the electronic trading company would not be
appropriate.

. How quickly do we need to act to implement this strategy successfully?

The Board believes that time is of the essence. The CBOT needs to make a
decision now about its future in order to capture early mover advantages.
Any delay may only serve to hurt the ultimate value of the restructuring to
the membership.

<PAGE>

Restructuring Impact on the CBOT and its Members

. How will Step One of the restructuring impact the CBOT?

As a result of the reincorporation of the CBOT in Delaware, the CBOT's
current special charter will be eliminated and it will lose its unique
status as a "special charter" entity. The CBOT will become a non-stock,
not-for-profit Delaware corporation, with a new certificate of
incorporation, bylaws, rules and regulations. We believe that this
reincorporation will provide the CBOT with greater flexibility to pursue
its goals, including the implementation of the overall restructuring
strategy. Among other things, Delaware law will permit the reorganized CBOT
("Delaware NFP CBOT") to elect, upon appropriate member approval, to change
its status to become a for-profit corporation.

. Will there be any change in my class of membership or membership interest
after implementation of Step One?

As a result of Step One, the members of the CBOT will become members of the
reorganized Delaware NFP CBOT, which will retain the current not-for-profit
status of the CBOT. Each class of CBOT membership and membership interest
will be converted into a corresponding class of Delaware NFP CBOT
membership of membership interest. The rights and obligations of the
members of Delaware NFP CBOT will be governed by the new certificate of
incorporation, bylaws (which will incorporate substantial portions of the
current CBOT rules), substantial portions of the current CBOT regulations
and applicable Delaware law. A detailed description of those rules and
regulations which will be changed or repealed in connection with Step One
of the restructuring will be included in the ballot disclosure. Also
included in the ballot disclosure will be the full text of the new
certificate of incorporation and bylaws of Delaware NFP CBOT.

. Will there be any changes in my rights and obligations as a member or
membership interest holder after implementation of Step One?

As a result of Step One, some of the rights and obligations of members and
membership interest holders will change from those currently held in the
CBOT today. Generally speaking, however, we believe that the memberships
and membership interests in Delaware NFP CBOT will be substantially similar
in all material respects to those held in the CBOT today. A detailed
comparison of the rights of members before and after Step One will be
included in the ballot disclosure, which you should read and consider
carefully.

<PAGE>

. What are the tax implications of restructuring?

The disclosure materials relating to the subsequent membership vote will
contain information regarding the restructuring tax consequences for U.S.
federal income tax purposes for all members. However, everyone is urged to
contact their personal tax advisor to assess the specific consequences of
the restructuring to him or her.

. What will happen to traders' jobs?

Similar to today, all traders have the choice to continue trading in the
updated open outcry market or trade electronically or to do both.

. How will the restructuring affect the leasing rights of current members?

We currently expect that the leasing privileges, with respect to trading
and the CBOE exercise right, will remain the same as they are today.

<PAGE>

Details about the Proposed New Companies

. Why will the electronic trading business be operated as an independent
company?

Operating the CBOT, focused on updated open outcry trading, as independent
from the reorganized electronic trading company should allow each to make
decisions that are best for each individual company. Within a single
company structure, the Board and management teams could be forced to make
trade-off decisions between the two types of trading platforms.
Additionally, with limited resources, one or the other would be compromised
and potentially could lead to the sub-optimization or even failure of both.
For example, if electronic trading were growing rapidly the Board would be
inclined to invest heavily to fuel that growth. That investment could come
at the expense of open outcry.

And finally, Merrill Lynch & Co., as financial advisor to the CBOT in
connection with the restructuring, has advised the Board that the
electronic trading company will have a higher valuation if it is maintained
as a separate entity from the CBOT.

. Will ownership of the for-profit CBOT and the electronic trading company be
independent of each other?

Immediately following the proposed separation of the electronic trading
company from the for-profit CBOT, it is expected that the stockholders of
the for-profit CBOT would become stockholders of the electronic trading
company. The restructuring anticipates that the for-profit CBOT and the
electronic trading company will operate as two separate companies, with
independent boards of directors and management. As described in the
Restructuring Report, there will be certain non-compete and cooperative
agreements between the two companies currently expected to last three
years.

. Have rulebooks for the new companies been written?

After the independent electronic trading company is reorganized and becomes
a designated contract market, the for-profit CBOT and the electronic
trading company will have separate rulebooks. It is currently expected that
the charter, bylaws and trading rules for the for-profit CBOT and the
electronic trading company will be prepared and presented to the membership
in connection with a subsequent membership vote. It is currently
contemplated that one rulebook will be used until such time.

. What actions will the for-profit CBOT take that will make open outcry
competitive?

For-profit CBOT will undertake cost reduction efforts and attempt to
restructure its liabilities in order to strengthen its financial position.

<PAGE>

. What will it cost the CBOT to restructure?

We are still defining the total cost for restructuring. We currently expect
that the restructured open outcry and electronic trading companies will
each pay for their own restructuring costs. Based on preliminary analysis,
it is expected that these companies should be able to afford requisite
restructuring and start-up/activation costs.

. Should the CBOT improve its financial position before undertaking a
restructuring?

We believe that improving our current financial position should not be
considered outside the context of restructuring. In fact, it is an integral
component of restructuring. We believe that delaying restructuring will
only worsen the current financial position of the CBOT. Given the current
competitive environment, we believe that the CBOT must undertake the
restructuring program urgently. We believe that the restructuring is the
key to enabling the CBOT to make the significant operating, structural and
financial improvements required.

. What types of customers would the electronic company target?

In addition to the current CBOT customer base, there would be opportunities
for the electronic trading eBrokers, day traders, business-to-business e-
commerce and retail investors.

. Are there any potential strategic partners interested in the electronic
trading company?

Certain potential strategic partners and venture capitalists have
approached the CBOT to express a possible interest in the concept of the
reorganized electronic trading company. However, there have been no
discussions and there has not yet been any determination with respect to
the appropriate structure or terms of any such investment in the electronic
trading company.

. How will the board of directors be selected for each of the new companies?

Information regarding the process for selecting the respective boards of
directors for the for-profit CBOT and the reorganized electronic trading
company are included in the Restructuring Report.

. How does the restructuring affect clearing and the Board of Trade Clearing
Corporation (BOTCC)?

Initially, it is expected that both companies will contract with BOTCC to
act as their clearinghouse and BOTCC will offer fungibility to both
companies. No formal arrangements have been made at this time.

<PAGE>

. How does the restructuring impact the CBOT/Eurex alliance?

The CBOT/Eurex joint venture is a significant asset of the CBOT that we
intend to include as a key component of the electronic trading company. We
believe our CBOT/Eurex agreement will position us to create a superior
electronic trading business.

. How will trading fees be established for the electronic trading company and
for-profit CBOT?

We currently expect that trading fees assessed by each company will be
determined independently by their respective boards of directors and
management. The electronic trading company, however, is currently
anticipated to establish exchange fees for CBOT members and their lessees
that are no higher than those charged to anyone else for the term of a
three-year non-compete and cooperative agreement.

. Will all products at CBOT be traded at the electronic trading company?

The reorganized electronic trading company is currently expected to trade
every product currently offered by the CBOT with full fungibility of such
products and clearing functions provided by the Board of Trade Clearing
Corporation.

. Will the management of the electronic trading company operate independently
of CBOT?

We currently intend that the management of the electronic trading company
will be substantially independent as soon as it is established. Merrill
Lynch & Co. has indicated to the Board that having independent management
in place is necessary in order to position the electronic trading company
as a viable candidate to attract strategic partners and for an initial
public offering. The CBOT Board will retain the authority to establish
certain terms of operations of the electronic trading company. Powers
reserved to the CBOT Board for approval are currently expected to include,
without limitation, the issuance of up to 20% of the equity of the
electronic trading company, the operation of Ceres by the electronic
trading company as general partner, if applicable, and policies with
respect to fees, hours, margins and access. During the interim period after
the first member approval and before the final separation of the
reorganized electronic trading company, as the board of directors of the
controlling shareholder of the electronic trading company and due to
various operational requirements such as funding and access to products,
platforms and fungibility, the CBOT board of directors ultimately will be
in a position to direct the focus of the electronic trading company and its
board of directors.

<PAGE>

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.

<PAGE>

[This screen may be accessed by clicking the "CBOT Files Suit Over Exercise
Rights" button on the Home Page Screen and Restructuring Screen.]

Chicago Board of Trade Press Box
--------------------------------------------------------------------------------

Press Release

FOR IMMEDIATE RELEASE

David Prosperi
312-435-3456
Katherine Spring
312-475-5987

CBOT FILES SUIT OVER EXERCISE RIGHT

The CBOT complaint seeks a declaration that its move to a Delaware
not-for-profit corporation preserves the Exercise Right

Attached are copies of the CBOE's June 29 response, our reply, and our letter to
CBOT members regarding the lawsuit.

<PAGE>

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

Chicago Board of Trade Options Exchange 400 South LaSalle Street Chicago,
Illinois 60605 www.cboe.com

Thomas A. Bond Vice Chairman Phone: 312 786-7088 Fax: 312 786-7407 [email protected]

June 29, 2000

BY MESSENGER

Mr. David P. Brennan Chairman of the Board Chicago Board of Trade 141 West
Jackson Boulevard Chicago, Illinois 60604

Dear David,

Sincerely, Thomas A. Bond Vice Chairman

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

June 30, 2000

Dear Bill and Tom:

As you know, preserving the Exercise Right is an essential ingredient of our
restructuring plan. Since you have been unwilling to provide us with any
assurance that you will not act

<PAGE>

Sincerely, David P. Brennan

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

June 30, 2000

Dear Fellow Members:

On June 20, 2000, CBOE issued a circular stating that when Step One of our
Restructuring is completed our Full Members' CBOE Exercise Right would
"disappear" as a matter of law. We strongly disagree with CBOE's view.
Yesterday, June 29, CBOE issued a new circular, and in response I wrote to CBOE
asking for confirmation that its position had changed and that after our
reincorporation in Delaware CBOE would take no action to jeopardize the Exercise
Right. CBOE has refused to provide that confirmation. Instead, late yesterday
afternoon they sent me the attached letter, which speaks for itself. My reply to
CBOE's June 29 letter is also attached.

<PAGE>

Sincerely, David P. Brennan

Email: [email protected] Hotline: 847-326-0926 Phone: 312-347-5102 Fax:
312-341-5810 Mail: CBOT Restructuring 4015 Board of Trade Building Chicago, Ill.
60604

<PAGE>

[This screen can be accessed by clicking the "Step One Ballot Mailed for June 28
Vote" button on the Restructuring Screen.]

Chicago Board of Trade News & Views
--------------------------------------------------------------------------------

June 5, 2000

Dear Fellow Member,

The ballots for step one of our restructuring plan have been mailed to members
for a June 28, 2000 membership vote.

Since our floor meeting May 25, I have received very positive feedback from
members who attended, and I am confident that our restructuring plan, so
imperative to our success, will pass.

I have attached for your information a letter from Mayor Daley, in which he
lends his support to our restructuring initiative. I felt it important to pass
it along to the membership.

Sincerely,

David P. Brennan

<PAGE>

Mr. David P. Brennan
Chairman
Chicago Board of Trade
141 West Jackson Boulevard
Sixth Floor
Chicago, Illinois 60604

Dear Chairman Brennan and Members of the Chicago Board of Trade:

Congratulations and best wishes as you near a vote on one of the most
critical issues your institution has faced in its 152-year history. All of
Chicago faces the challenges of new technology and a changing economy, and
keeping the marketplace vibrant for the future of Chicago and for you as members
of the Board of Trade is very important.

Chicago's exchanges have always been at the forefront of their industry.
You represent the best of the city's entrepreneurial spirit. From the
introduction of financial futures and side-by-side trading to after-hours
trading and electronic markets, the Chicago Board of Trade and its fellow
exchanges have blazed the trail to the financial future. You continue to
innovate as you move forward in this decision-making process, and I congratulate
you on your commitment to addressing these challenging issues.

Chicago's exchanges provide nearly 200,000 jobs to our community, and more
than $35 billion in bank deposits. You are a critical part of our region's
economy and a Chicago icon for the world. I am confident that the Chicago Board
of Trade will rise to all challenges and succeed. I wish you and your members
all the best as you face these critical decisions.

Sincerely,

Mayor

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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, a documents filed by the CBOT
at the Commissions web site 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,
141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.

<PAGE>

[This screen may be accessed by clicking the "May 25, 2000 Floor Meeting" button
on the Restructuring Screen.]

Chicago Board of Trade News & Views
--------------------------------------------------------------------------------

May 25, 2000
CBOT Floor Meeting
Remarks by Chairman David P. Brennan

Welcome members as well as to those on MemberNet. I am excited to talk to you
today about the proposed restructuring plan and the implementation of the first
step of the restructuring process that was approved by the Board of Directors
last week.

Before I begin, I would like to thank the members of the Restructuring Task
Force, the Implementation Committee, the Allocation Committee and management for
bringing this plan before the membership.

By now, you should have all received the Restructuring Report as well as a Q&A
document on the restructuring. I hope that you have found these useful as a
first step in understanding the steps we are taking and the vote that will be
before the members shortly.

The Board of Directors overwhelmingly approved the ballot for the membership
vote and unanimously approved the restructuring report.

The purpose of today's meeting is to provide you with an overview of the actions
recently taken by the Board and the ballot on which you will be asked to vote.

What I want to address are the issues surrounding the first vote which is just
Step 1 of the restructuring process and is more technical in nature. To assist
me in this process, I have asked a number of the external advisors that have
been working with the Board of Trade to be with us today.

I will begin by giving you a high level overview of the restructuring plan, some
key industry trends, and address some issues in my opening remarks.

Next, I will ask Justin Zubrod, a Vice President with A.T. Kearney, to provide a
brief summary of the restructuring plan. Justin and a team from A.T. Kearney
have been working with us for several months to develop this plan.

Next, Kirkland & Ellis will outline the specific provisions of the ballot on
which the members are being asked to vote. Members are being asked to vote only
on Step One of the restructuring and Kirkland & Ellis will explain exactly what
that means.
<PAGE>

Finally, I would like to ask Interim President Dennis Dutterer to share with us
his perspectives.

After you have heard from these groups, we will have more time for Q&A. I'll ask
that you hold your questions until then so that we can get through all of the
information in a timely manner.

We entered this year with a bold plan for the future of the Chicago Board of
Trade. The industry is changing and our competitors are not sitting still. Even
since we initially spoke regarding the restructuring plan in January, other
markets have continued to make progress. I see three fundamental changes
currently underway in our business.

Number One--Our members are becoming our competitors
Number Two--Exchanges are reinventing themselves
Number Three--Cash and futures markets are converging

I would like to speak briefly about each one of these trends.

In terms of our members becoming our competitors:

It seems that not a day passes where there isn't some news about our members and
their efforts to create competing markets.

. As you know BrokerTec was formed by seven of our largest member firms--its
efforts are moving fast and it is scheduled to launch its platform for
trading cash government debt instruments in 3Q 2000. BrokerTec plans to
have a derivatives trading platform in the near future.
. The second obvious example is Cantor Fitzgerald which has formed eSpeed--
eSpeed is a direct competitor for many of our products and they recently
signed a deal with eight online brokers to offer e-trading of fixed-income
products for retail clients.

These are but some of the more notable examples of what our members are doing.
However, there is yet another set of initiatives that many of our competitors,
many of which are members, are executing in regards to internet e-commerce in
the agricultural and financial industries. I will speak more about that later.

The next point I would like to make regarding the industry is that competing
exchanges are quickly reinventing themselves.

<PAGE>

What do I mean by this?

. First, exchanges are aggressively and quickly modifying their ownership
structures in light of the changing market demands.
. The Chicago Mercantile Exchange is scheduled to vote on demutalization on
June 6.
. The New York Mercantile Exchange is scheduled to vote on demutalization on
June 20.
. Second, as global barriers decrease and exchanges become more electronic
the industry is consolidating.
. The Paris, Amsterdam and Brussels exchanges announced a merger to
form EuroNext.
. Archipelago, an ECN, acquired Pacific Exchange.
. Deutsche Bourse and London Stock Exchange announced a potential
merger to form iX.
. These are but a few examples of the consolidation--a trend that I fully
anticipate will continue.
. Third, existing futures exchanges are investing heavily in their
electronic trading business--and are using e-commerce to extend their
businesses.
. NYMEX has formed eNYMEX to focus on the OTC energy market.
. LIFFE has formed LIFFE.com to sell its LIFFE Connect technology.
. The Chicago Mercantile Exchange has allocated top staff and
substantial capital to form business-to-business internet based
commodity markets.

It is clear not only that our competitors are adapting but that they are
adapting quickly.

The final point I would like to make with respect to the industry is that the
cash and futures markets are converging.

Within the Agricultural, Financial and Energy industries companies are making
aggressive plays to create internet based cash markets. This has attracted
substantial investor capital and many competing companies have joined forces. It
won't be long before almost all of the cash markets for our products are traded
on the internet--we believe that customers will also want futures contracts on
the same site.

In the financial markets, investment banks' proprietary web sites--as well as
third-party web sites such as TradeWeb and EuroMTS--have made significant
in-roads in creating internet-based markets for global government debt
instruments.

<PAGE>

It is only a matter of time before the likes of Rooster.com--started by one of
our member firms--ice.com, and Farms.com begin to make the same inroads in the
agricultural markets.

The big question is whether we can go after that same business before they come
after ours. Our restructuring plan positions us to aggressively compete for that
business and potentially dominate it. Our current structure guarantees that we
won't even be a contender. So, where do we currently stand?

. First, in my opinion we have under-invested in e-commerce

It is true that we have invested a substantial amount of money in Eurex's
technology but we haven't been able to seek out opportunities in the rapidly
evolving B2B marketplaces due to our governance structure and constrained fiscal
position.

Frankly, I don't think that it is possible to make the type of investment that
is required while continuing to simultaneously operate an open-outcry
exchange--therefore as described in the restructuring plan we have proposed
splitting the electronic trading company into a separate entity after Step II of
the restructuring is complete.

. Second, regarding the current CBOT governance, we have an antiquated
corporate structure.

For the past 150 years we have been a Special Illinois Charter membership
organization and have been well served by this structure. Although it has worked
well in the past it is time that we move on and adopt a structure that provides
us greater flexibility in these fast-changing times.

A move to Delaware will provide us the flexibility that we require and this is
all we are asking for in the first membership vote.

Before we move on, let me address some key issues. Many of us are concerned with
our trading privileges and ownership. I want to address three issues up-front:

Number One: Fungibility of our products

Number Two: Preferential member pricing

Number Three: Allocation

The first issue is fungibility.
<PAGE>

The recommendations of the Implementation Committee as adopted by the Board of
Directors contemplates a $55 million payment from the electronic trading company
to the open outcry company upon separation of the two.

The electronic trading company will pay its share of common operating costs.

Additionally, the electronic trading company will pay its share of the
liabilities primarily incurred in connection with the development of the
CBOT/Eurex alliance.

Under the recommended restructuring plan the membership shall receive:

. All of their shares of electronic trading company other than the portion
sold to third-party investors,
. And an opportunity to participate in such capital raising in order
preserve your ownership interest.

Again this allows you, the members, to reap the full value created in the new
electronic company. We also believe the fungibility of products following the
separation will be beneficial to both companies.

This will allow the open outcry company:

. To leverage its strengths to compete effectively for order flow.
. And will allow its market participants to offset open interests across the
platforms as well as cross-margin benefits.

An ongoing payment will have an adverse impact on the ability of the electronic
trading company to raise capital in the private and public markets. That capital
is needed to fund its operations and create value for the members.

Many of you are aware of the relationship between Cantor Fitzgerald and eSpeed.
I believe there has been a misplaced comparison between Cantor Fitzgerald's
formation of eSpeed and the Board of Trade proposed formation of the electronic
trading company. Espeeds' fundamentals are:

. It is the majority-owned subsidiary of Cantor, and houses the electronic
platform used by the Cantor exchange.
. It shares its trading platform so all revenues are shared between Cantor
and eSpeed.
. Cantor raised money through the sale of a portion of its share in eSpeed
at the time of eSpeed's IPO.
<PAGE>

The key differences between our plan and eSpeed are:

1. Cantor did not receive any one-time payment from eSpeed as is contemplated
in our restructuring plan.

2. And in our restructuring plan there are two separate companies with no
parent-subsidiary relationship.

Based on this we believe that the open outcry company and the membership are
receiving significant and full value. The second issue is preferential member
pricing.

The restructuring plan currently provides that members at the open outcry
company will receive:

. The best pricing at the electronic trading company for three years, which
is the duration of the contemplated non-compete agreement between the two
entities.
. This right would travel with a member's seat, whether transferred by sale
or lease.
. This will allow smaller members to compete with larger traders and firms
who have higher trading volumes throughout the term of the non-compete.

We have been advised that granting a perpetual right to preferential pricing may
have a significant and negative impact on the financial results and operating
flexibility of the electronic trading company. This adverse impact should not be
offset by any benefit to seat values at the open outcry company.

Further, such a right may adversely affect the ability of the electronic trading
company to effectively raise capital in the private and public markets, capital
which is needed to fund operations and create ongoing value to the membership.

The Management of the electronic trading company could decide to extend the
preferential pricing policy beyond the three-year term of the non-compete.
However, its decisions will be driven by business judgment and actions to ensure
liquidity and shareholder value at the electronic exchange.

The preferential pricing rights and fungibility reflect the Implementation
Committee's and Board of Directors' best judgment in light of the plan as a
whole and the benefits to be derived by all members in the restructuring.

Brian Sterling, Managing Director of Merrill Lynch &

<PAGE>

Company is here with me. He will be able to answer more specific questions in
the Q&A session on fungibility, eSpeed, and preferential member pricing.

The third issue is allocation

In January the Board of Directors established an Independent Allocation
Committee, comprised solely of the public or "outside" directors of the Board.
The mission of this committee was to determine and recommend a fair allocation
of shares in the for-profit CBOT and the electronic trading company.

The Independent Allocation Committee engaged an independent financial advisor,
William Blair and Company, and special counsel, to assist in developing its
recommendation.

After considering various methodologies for allocation, the Independent
Allocation Committee concluded that an allocation methodology that takes into
account a combination of factors rather than a single factor is appropriate and
that the factors should include:

. Relative liquidation rights, (beta symbol) Relative voting rights,
. The Ceres allocation,
. The market prices of memberships and membership interests, and
. The contract volumes.

The Committee did not believe it was appropriate to assign specific weight to
any particular factor, but concluded that relatively greater importance should
be given to liquidation rights, voting rights, and the Ceres allocation.

Based on these conclusions, the Allocation Committee unanimously recommended an
allocation of shares in each of the for-profit CBOT and the electronic trading
company in the following ratios:

. Full--5.00
. AM--1.00 (beta symbol) GIM--0.50 (beta symbol) COM--0.07
. IDEM--0.06

At our last Board meeting, the full Board considered and approved the
recommendation.

We have gone to great lengths to ensure that this was a fair and impartial
process.

Restructuring is about fundamental change. This means focusing on the future.
The Board of Directors, Restructuring Task Force, Implementation Committee and

<PAGE>

all of our advisors have been focused on putting together a forward-looking
plan. Many of you share this same spirit. We need to go forward.

As I have mentioned many times before, the objective of restructuring is very
simple: Position the members of this exchange to own the future. To do this, we
need to create the best possible open-outcry and electronic trading businesses
for the Board of Trade and its members. "Status quo or deferral is not an
option. There is no Plan B."

Yes, there have been many things to explore. I believe we have spent more than
adequate time on analysis. Let's move ahead--now.

We have an opportunity to dominate the future. I believe in this institution,
its history as a market leader and the wisdom of its members to see this
opportunity and grab it. I see a bright future for all of us.

Our plan is solid. I look forward to your "embracing change" and to your
approval.

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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 Commissions web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.

<PAGE>

[This screen may be accessed by clicking the "Board Approves Step One of
Restructuring" button on the Restructuring Screen.]

Chicago Board of Trade News & Views
--------------------------------------------------------------------------------

May 17, 2000

Dear Fellow Members:

I am very proud and honored to announce that the Board of Directors of the
Chicago Board of Trade approved the ballot containing Step One of the
restructuring plan. This event is a momentous step forward and a history-making
event for our organization. The overall restructuring plan will allow the CBOT
to focus on updated open outcry trading, while at the same time capture the
growth of electronic trading.

You will shortly be receiving the ballot along with disclosure materials. The
ballot seeks the membership's approval to reincorporate the Chicago Board of
Trade in Delaware as a Delaware non-stock, not-for-profit corporation. The
ballot materials also confirm our intention to form a wholly-owned, for-profit
subsidiary through which we will conduct our electronic trading business, part
of which is currently operated by Ceres.

The ballot disclosure materials will provide additional information on the legal
actions required to implement Step One of the restructuring, certain changes in
member rights and obligations after reincorporation in Delaware and the
procedure for and timing of the member vote. Step One of the restructuring is
expected to be implemented as soon as practicable following approval by the
members in this member vote, as described in the ballot disclosure.

In the next few days, we will also send each of you a special report setting
forth the current recommendations of the Implementation Committee. We are
providing you with this report because we believe it is extremely important to
inform the membership of the overall restructuring plan beyond Step One. This
plan was reviewed and adopted by the Board at today's meeting as the current
vision of the overall restructuring strategy. The subsequent steps of the
restructuring plan would be implemented as soon as practicable following
subsequent membership approval and subject to receiving certain regulatory
approvals and a favorable ruling from the Internal Revenue Service.

I would like to express my gratitude to the Restructuring Task Force, a task
force comprised of directors and members, which contributed a tremendous amount
of work to the development of this plan. I would also like to thank the
Implementation Committee of the Board of Directors, which is comprised of
Charlie Carey, Flip Filipowski, Harold Lavender, Peter Lee, Veda Kaufman Levin,
Jamie McMillin, Joe Niciforo and Mike Ryan. My thanks also go out to the
Independent Allocation Committee of the Board of Directors, which is chaired by
Governor Thompson and comprised of Dr. Robert S. Hamada, Robert H. Michel and
Ralph H. Weems.

This is a historic time for the Chicago Board of Trade. The CBOT has built its
leadership position by being highly responsive to customers and having superior
management. This restructuring is another ground-breaking step in continuing the
CBOT's industry

141 W. Jackson Blvd.
Chicago, Illinois 60604-2994
312 435-3601
Fax: 312 341-3392

We urge CBOT members and membership interest holders to read the Registration
Statements on Form S-4, including the proxy statement/prospectus contained
within the Registration Statements, regarding the CBOT restructuring referred to
herein or in connection herewith, when it becomes available, as well as the
other documents that the CBOT has filed or will file with the Securities and
Exchange Commission, 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 web site 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, 141 W. Jackson Blvd., Chicago, Illinois 60604-2994, 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 be any sale of securities in any state in which
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. No offering of
securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.