H
}
H
3

December 22, 2014

lam a broker on the grain floor of the Chicago Board of Trade, t support the current settlement method
and do not want itto be sitered, | want settlement prices to be determined by open-outcry trading (r
the pit on the close.

Thank you far your consideration in this matter.

Mame S Crkoat fC



December 21, 2012

i Jam a market maker on the graln floor of the Chicaga Board of Trade. f support the current settlement
i method and do not want it to be altered. | want settlement prices to be determined by operroutcry
trading in the pit on the close.

Thank you for your consideration in thls matter.

SCR



the CBOT’s obligations to maintain and sustain the open outcry markets. Defendants
breached their fiduciary duties to Plaintiffs by unilaterally determining to change the
CBOT procedures for reaching settlement prices to an electronic platform, without any
determination by the CBOT Board of Directors much less a finding by the CBOT Board
of Directors that the open outery markets are no longer liquid, and without approval from
a majority of the Series B-1 and Series B-2 members. Defendants breached their fiduciary
duties by implementing a system, that adversely affects and harms Plaintiffs’ interests in
Series B-1 membership and violated their fiduciary duty to maintain and sustain the open
outcry markets,

101. Defendants’ conduct in conjunction with the decision to change the
settlement system also violated their duty of loyalty and good faith to Plaintiffs.
Defendants knew at the time that they determined to make the change that the increase in
electronic trading volume that result would inure to the benefit of high frequency
electronic traders, and to the detriment of the traders in the “pits.” Thus, they failed to act
in Plaintiffs’ best interests, Jn addition, Defendants discriminated against Series B-1
members of the CBOT by adopting the change for the Agricultural Futures pit but
tefusing to adopt the change for the Livestock Futures pit of the CME. Thus, Plaintiffs
are likely to succeed on the metits of their claims against Defendants,

-102, Plaintiffs have suffered damages as a result of Defendants’ breaches of
their fiduciary duties ~ ;
°WHEREFORE, Plaintiffs request the following relief:

A. Damages in, excess of $50,000 an amount to be proven at trial; and

B. For such other and further relief as the Court deems just and appropriate.

28



IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS
COUNTY DEPARTMENT, CHANCERY DIVISION

ANTHONY McKERR, HEATHER KOCH,
JOSEPH FASANO, THOMAS G. FANNING,
BRANDON KORESS, A. JOHN YAVARI,
WILLIAM ARMONDA, TODD THIELMANN,
STEPHEN MELTON, MARK McKENNA,
WILLIAM MONTGOMERY, RALPH DYNEK,

SARAH McCARRON, JAMES F. HARKNESS, SO6H2 3188
MARK ROTHSCHILD, MARK TELANDER,
STEVEN LOULOUSIS, KEVIN E. DUFFY, No.
RORY O’DONNELL, CRAIG 8. FELDE,
BRAD. HOFFMAN, MATT McBRIDE,
SAMUEL M. DADDANO, and MARY McKERR,
JORY DEMAND

Plaintiffs,

¥Y

Na ee ee ee ee ee ee

THE BOARD OF TRADE OF THE CITY OF
CHICAGO, INC,, THE CME GROUP, INC.
TERRENCE DUFFY, and PHUPINDER GILL,

Defendants.

VERIFIED. COMPLAINT
Plaintiffs Anthony McKerr, Heather Koch, Joseph Fasano, Thomas G, Fanning,
Brandon Koress, A. John Yayari, William Armonda, Todd Thielmann, Stephen Melton,
Mark McKenna, William Montgomery, Ralph Dynek, Sarah McCarron, James F.
Harkness, Mark Rothschild, Mark Telander, Steven Loulousis, Kevin E. Duffy, Rory

O'Donnell, Craig S. Felde, Brad Hoffman, Matt McBride, Samuel M. Daddano, and

Mary McKerr (collectively “Plaintiffs”), by and through their undersigned attorneys,

respectfully submit their Complaint against the Board of Trade of the City of Chicago,
Inc. (““CBOT”), the CME Group, Inc. (“CME”), Terrence Duffy, and Phupinder Gill

(collectively, “Defendants”),



December 21, 2021

lam a market maker on the grain'ftogr of thé Chicago Board of Trade. ! support the cuirent settlement
method and do not want it to be altered. } want settlement Orices to be determined by open-nutcry
trading in the pit on the close.

Thank you for your consideration in titls matter.

. Alas feta (6)

suns ver ine gesio Hoor or tne Chicago Bugtd of Trade. | support the current sHaienie..



Rene Tricou
OMEGA FUTUI
463 Timbercreek Drive
Tennessee 37803

March 29, 2012
Dear CME GROUP,

If the pits close then the electronic DarthVadors will be better able to
manipulate prices and run stops. The floor keeps the electronic trading honest and
the electronic trading keeps the floor honest. I know it’s all about the money AND
it should be, this is America.

Just increase the clearing for Agricultural products!

Sincerely,
Rene Tricou
tricou@usa.net Pee te Se tees

Pane 1 Sane



{
|
|
i

January 06, 2012

Bruce Williams

Dear CME GROUP,

I have been a market maker on the CBOT floor for 30 years, T left the
pit 3 years ago to trade on the screen. I currently trade on the screen from the
floor. You now have 2 markets that are split up and diluted instead of 1 great
liquid one. You also have very litéle regulation to what high frequency
traders are allowed to use in there programming.

Screen based trading is NOT a level playing field. So we are currently

stuck in this poor excuse of a market!
Sincerely,
Bruce Williams

Soa Shave Dayarkets that are enhin ea and bileated preted gh dae tet

Bawsoya@uol. com



settlement rule is adopted, Armando will lose the vast majority his livelihood and
therefore his business as a trader will be ended.

68. Plaintiff Samual Daddano has traded in the Com pit and at the CBOT for
approximately 16 years, A large petcentage of Daddano’s income is derived from trading
the closing tange with settlement determined by open outcry orders. If the new
settlement rule is adopted, Daddano will lose the vast majority his livelihood and
therefore his business as a trader will be ended.

69. Plaintiff Matt McBride is a Class B shareholder of the CBOT and
currently trades daily in the Com pit at the CBOT. McBride has made his livelihood
trading in the open outcry arena at the CBOT for approximately 12 years. A large
percentage of his income is derived from trading the closing range with settlement
determined by open outcry orders, If the new settlement mile is adopted, McBride will
lose the vast majority his livelthood and therefore his business as a trader will be ended.

70, Plaintiff Brandon Koress is a Class B shareholder of the CBOT and
currently trades daily in the Corn pit at the CBOT. Koress has made his livelihood
trading in the open outcry arena at the CBOT for approximately 20 years. A large
percentage of his income is derived from trading the closing range with settlement
determined by open outery orders. If the new settlement rule is adopted, Koress will lose
the vast majority his livelihood and therefore his business as a trader will be,ended.

71. All Plaintiffs as CBOT members or lessees will be out of business, if the
new settlement rule is adopted, whether as an order filler, market maker member of a

proprietary trading firm, or member of a clearing firm.

18



schultz @hte.net

Elmer and Carol Schultz - -
3234 N 860 W
Rensselaer, IN 47978-8630

We our a family of Farms in Rensselaer, IN. | oppose the changing of the pricing
procedure, (Strongly) Thanks for letting me no about it.

Elmer and Carol Schultz



2. Class B Membership.

{a) Class B Memberships in the Corporation (each a “Class B Membership” and the holder thereof, &
“Clasa B Member’) shall represent the right to trade on and othervise utilize the facilities of the Corporation
in accordance with and to the extent permitted by this Certificate of Incorporation, the Bylaws and, to the
extent not inconsistent with this Certificate of Incorporation, the Bylaws or the Rules. There shall be
authorized three thousand six hundred eighty-one (3,681) Class B Memberships, which shall be divided inte... Le
five (5) series (“Series”) as follows: .

1,402 Series D-1 Memberships (each, a “Serics B-1 Membership” and the holder thereaf, a “Series B-1
Member);

867 Series B-2 Memberships (each, a “Series B-2 Membership” and the holder thereof, a “Series B-2
Member”);

128 Series B-3 Memberships (each, a “Series B-3 Membership” and the holder thereof, a “Series B-3
Member);

641 Serics B-4 Memberships (cach, a “Series B-4 Membership” and the holder thereof, a “Series B-4
Member”); and

643 Series B-5 Memberships (cach, a “Series B-5 Membership” and the holder thereof, a “Series B-5
Member"); .

: (b} Notwithstanding Section B(2)(a) of this Article [V, the Corporation may issue additional authorized
tf but unissued Series B-2 Memberships only in connection vith the conversion of Series B-3 Memberships into
Series B-2 Memberships pursuant to Section D(3) of this Article TV and no person may become or qualify as a
Series B-2 Member at any time by acquiring a theretofore authorized but unissued Series B-2 Membership
except as a result of such a conversion,

{c) Class B Memberships shall have uo right to receive any dividend or other distribution (including
upon liquidation, dissolution, winding-np or otherwise} to be declared, paid or distributed by the Corporation,
‘The respective rights and privileges af each Series of Class B Membership shail be as provided in or pursuant
to this Certificate of Incorporation and the Bylaws. .

C. Class B Voting Rights.
Except as otherwise expressly provided im this Certificate of Incorporation, the holders of Class B eee re ee
Memberships shall not be entitled to vote on any matter. On any matter on which the holders of Series B-[
Memberships and Series B-2 Memberships are entitled to vote together as 4 single class pursuant ta this Certificate
of Incorporation, each holder of Series B-1 Memberships shall be entitled to one (1} vote per such membership and
each holder of Serics B-2 Memberships shail be entitled to one-sixth (1/6) of one (1) vote per such membership.

D, Special Rights of Class B Membership.

The holders of cach Series of Class B Membership shall have the trading rights and other rights and
Privileges, and shall be subject to the restrictions, terms and conditions, set forth below,

1. Series Trading Rights.

(a) Series B-! Memberships. Bach holder of a Scrics B-1 Membership who satisfies the qualifications
for and requirements of Full Membership in the Corporation as set forth in the Rules shall'be entitled to the
rights and privileges of, and shal! be subject to the restrictions, conditions and limitations on, a Full Member
as set forth in this Certificate of Incorporation, the Bylaws and the Rules, Bach holder of a Series B-1
Membership shalt elso be entitled to all trading rights and privileges for ail new products first mado available
after the filing of this Certificate of Incorporation traded on the open outcry exchange system of the
Corporation or Chicago Mercantile Exchange Inc. (“CME Exchange”) or any electronic trading systern
maintained by the Corporation or CME Exchange or any of their respective successors of successors-in-
interest, and the Board of Directors of the Corporation shall enforce this requirement,

$ (b) Series B-2 Memberships. Each holder of a Series B-2 Membership who satisfies the qualifications
: for and requirements of Associate Membership in the Corporation as set forth in the Rules shal] be entitled to



December 21, 2011

tam a Market Maker and a Floor Broker on the CBOT floor. 1 and my customers
want the current settlement process to remain. We do not want a full screen
settlement.

FAS

Joseph Fasano é,

Sande Datei me Lib ' Vay



|

sentence of Section D(2}(a) of Article LV, by merger or otherwise} shall require, first, the approval of the Board of
Directors of the Corporation and, second, the approval of a majority of the votes cest by the Series B-I Members
and Series B-2 Members, voting together as a single class in accordance with Scotion C of Article }¥, Except as
provided in the immediately preceding sentence, euy amendment of, or modification or repeal of any provision
contained in, this Certificate of Incorporation shall require, first, the approval of the Board of Directors of the
Corporation and, second, the approval of the Class A Member and no other member or series or class of membership
shall haye the right to vote on any such amendment or repeal.

sete



Gmail - Settlement Changes : Page 1 of 2

*
Goa a | { Alan Young <alyajy1@gmail.com>

beSirneals

Settlement Changes

{ message

Jimmy Boyle <jphoylez@gmuail.com> Wed, Der 28, 2011 af 19:53 AM
To: alyaly1@gmall.com

To wham it may concem,

bam a full CME member and do 90 - 95% of my trading. over the Globex platform. | love Globex and { think It
is the greatest thing since slicad bread, however | do not want ta wait sround an extra three hours everyday
for settlement prices to be calculated. There are really anty fw possible solutions for settlement prices, sither
rey are established via the pit close or exclusively on giobex, not a mix between the two. | ses no reason far

the settlement procedure fo change from its current state. It Is affective, honest and efficient, There are no.
icebergs, phantoms, of other order entry nonsense being played. An honest and fair price is what the floor
settlement price brings and there is absoiutely no reason fo change it,

Sinceraty,
James P Boyle It

https://mail. google.com/mail/v/0/2ui=2&ik~0ea70700b8& view=pidceat=protecting%20th... 12/28/2011



{¢) During the period ending at the annual meeting of shareholders of CME Group to be held in 2012,
the Corporation will provide the CBOT Directors (a3 defined in the bylaws of CME Group) with advance
notice (a “Rule Change Notice”) of any proposed chang to the Rules {a “Proposed Rule Change”). Ifa
majority of the CBOT Directors provide written notice to the Corporation (an “Tnitlal Rejectian Notice”)
within five (5) business days after delivery of the Rule Change Notice (the “Initial Rejection Notice Period”)
that they have determined in their sole discretion that any such Proposed Rule Change will materially impair
the business of the Corporation or materially impair the business opportunities of the holders of the Class B
Memberships, such Proposed Rule Change will be submitted to a committee of the Board of Directors of the
Corporation (the “Rule Change Committee”) comprised of three CBOT Directors designated by the Vice
‘Chairman of the Corporation and two CME Directors designated by the Chairman of the Corporation for
approval. Approval shall requite the affirmative vote ofa majority of the full Rule Change Committee. The
Corporation shall not effect any Proposed Ruts Change unless and until either (a) the Initial Rejection Notice
Period terminates without the CBOT Directors providing an Initial Rejection Notice with respect to such
Proposed Rule Change or (b) the Rule Change Committee approves such Proposed Rule Change,

3. Conversion Rights of Series B-3 Memberships.

(a) Conversion. Subject to, and apon. compliance with, the provisions of this Section D(3) of Article IV,
any two (2) Series B-3 Memberships shall be convertible at the option of the holder into one (1} Series B-2
Membership, .

{b) Mechantes of Conversion. A holder of Series B-3 Memberships may exercise the conversion right
specified in Section D(3)(a) of Article IV by delivering to the Corporation or any transfer agent of the

Corporation written notice stuting that the holder elects to convert such memberships, accompanied by the -- *

certificates or other instruments, if any, representing the memberships to be converted. Conversion shall be
deemed to have been effected on the date when delivery of such written notice, accompanied by such
certificate or other instrument, if any, is nade, and such date is referred to herein as the Conversion Date.

As promptly as practicable after the Conversion Date, the Corporation may issue and deliver to or upon the
written order of such holder a certificate or other instrument, if amy, representing the number of Series B-2

- Memberships to which such holder is entitled as a result of the exercise of such conversion right. The person
in whose name the certificates of other instruments representing Series B-2 Memberships are to be issued shall
be deemed to have become the holder of record of such Series B-2 Memberships on the applicable Conversion
Date.

(e) Memberships Reserved for Issuance. The Corporation shall take all actions necessary to reserve and
make available at all times for jssuance upon the conversion of Scrics B-3 Memberships, such number of
Series B-2 Memberships as are issuable upon the conversion of all outstanding Series B-3 Memberships.

E. Commitment to Maintain Open Outcry Markets, Subject to the terms and conditions of this Section E of
Article LY, the Corporation shall maintain open outcry markets operating as of April 22, 2005 (the “Effective Date”)
and provide financlat support to cach such market for technology, marketing and research, which the Board of
Directors of the Corporation determines, jn its sole and absolute discretion, is reasonably necessary to maintain each
such open outery market. :

Notwithstanding the foregoing or any other provision of this Certificate of Incorporation, the Board of
Directors of the Corporation may discontinue any open outcry market at such time and in such manner as it may
determine if (1) the Board of Directors determines, in its sole and absolute discretion, that a market is no longer

~ “liquid” or (2) the holders of a majority of the voting power of the then outstanding Series B-1 Memberships and
pective voting rights, approve the ||

Series B-2 Memberships, voting together as a single class based on their
discontinuance of such open ovicry market.

For purposcs of the foregoing, an open outory market will be deemed “liquid” for s0 Jong as it meets either of

"the following tests, in each case as measured on a quarterly basis:

(2) if e comparable exchange-traded product exisis, the open outcry market has maintained at least 30
percent (30%) of the average daily yolume of such comparable product {including for calculation purposes,
volume from Exchange-For-Physicals transactions in such open outcry market); or = *

{b) if no comparable exchange-traded product exists, the open outcry market has maintained at feast 40
percent (40%) of the average quarterly volume in that market as maintained by the Corporation in 2001

i
i
i



Rob Heitiethar.” ~~"
FUTURES INTERNATIONAL
190 8, LaSalfe St.

Suite # 1720

Chicago, Hlinois 60603

Phone: 773-960-2696 235i,

March 7, 2012

Dear CME GROUP,

Employ humans! The floor has a history and a purpose. Don't sell us out for
profits, and a false idea of market improyements!

’ Sincerely,

Rob Heineman

rheineman@futures-int.com



December 21, 2011

lam a Market Maker and a Floor Broker on the CBOT floor. | and my customers
want the current settlement process to remain. We do not want 4 full screen
settlement.

TO

Thomas O’Brien



December 28, 2011

As @ long standing customer ahd shareholder of the Chicago Mercantile Exchange, |
am writing ta voice my complaint about the proposed change in the settlement
procedures In live cattle, feeder cattle and hog futures in the spring, | am a floor Groker
and trader and have a wide range of clients which include commercial hedge accounts,
customer business, [B's and hedge funds.

lam also a co owner of Grainery Farms. We use the exchange to hedge over 7,000
acres of farmland in three different states. This represents over 2 million dotlars in
annual graln sales. ©

We all believe that the current pit based settlement !s a key factor to our business and
a change to electronic or hybrid settlement would have a detrimental effect on ail of our
business,

We believe the price discovery and transparency that Is achieved from open outcry Is
superior to that achieved from electronic settlement procedures,

t feel my own volume combined with the entire customer and filling business Ido
represents a significant amount of volume. | am requesting that the CME revisit this.
decision and take these facts into consideration to keep the current pit settlement
procedures in place,

Respectful
7

William Rinn Ty



i
}
4

Mike Smith
Smith Cattle Co
3316 1-40 West
Amarillo, TX 79102

1-18-2012
Dear CME GROUP,

Agacattle feeder and hedger I am opposed to any procedural change in the sotttement of
livestock, I fully depend on the ability to hedge and would not be in business without this
mechanism. I feed well over 100,000 head of cattle annually.

I believe any rule change, such as the CME proposes, would hurt the liquidity and transparency
currently used with pit settlement. The cattle pit traders provide a convenience to gel large
trad¢s done and mect our daily goals, especially during the delivery petiod,

And, ] feel the use of electroni¢ settlement is easily manipulated and will compromise the
integrity of the contract,

Sincerely,

Mike Stuth



CME with a significant tax break. Immediately afterwards, the CME announced that it
would remain in Hlinois.

40. _A significant amount of the jobs and income that the CME represented to

_ the Hlinois Legislature that would remain in Illinois if the CME was given a significant
tax break arise from the activities of individual traders and trading businesses whose
income is earned through the open outcry activity in the pits,

41. At the same time that the CME was seeking its tax break based upon
representations that jobs and income of the CME and its subsidiaries, including the
CBOT, would remain in Ilinois, the CME was intending to eliminate many of the jobs
and income from the open outery activity of the pits. On or about December 12, 2011, the
CME announced in a Special Executive Report ) (“Report”) that on or around March
2012, it would revise the rule for determining settlement prices to require that settlement
prices for Livestock futures at the CME and Agricultural fatures contracts at the CBOT,
including Com, Soybeans, Soybean Oil, Soybean Meal, Oats, Wheat, Rough Rice, Live
Cattle, Peeder Cattle, and Lean Hoes, would be determined through an algorithm that
incorporates both floor-based activity and electronic trading activity, as opposed to being
determined in the pits vie the open outcry system. A true and correct copy of the Special
Executive Report is attached hereto as Exhibit B,

42, The decision to base settlement by blending the volume of trades during
the close between open outery and electronic trading, or the VWAP procedure will
effectively close the open outery markets — which wilt rapidly become illiquid — and will
result in overwhelming losses of jobs and income to Plaintiffs. Also as a result, the value

of the Class B shares of the CBOT will rapidly lose value.

11



open outery market, usually on the close of the market so that the determination of the
“settlement” price is critical to Plaintiffs’ business. All of the Plaintiffs are cither
shareholdets of the CME and Class B shareholders in CBOT, or have leased the interests
of Class B shareholders of the CBOT and, therefore, stand in the Class B shareholders’
shoes,

8. Dendant, the CME, is a Delaware corporation that owns and operates a
number of large derivatives exchanges, including futures contracts for live cattle, feeder
cattle and Jean hog (the “Livestock futures”), located in downtown Chicago, Illinois. The
CME conducts at extensive amount of business it. Cook County, Minois.

9. Defendant, the CBOT, is a Delaware corporation and subsidiary of the CME,
that owns and operates a number of large derivatives exchanges, inciuding futures
contracts for com, soybeans, soybean oil, saybean meal, oats, wheat and rough rice(the
“Apricultural futures”), located in downtown Chicago, Iilinois. The CBOT conducts an
extensive amount of business in Cook County, Ilinois.

10. The Chicago Board of Trade was founded in 1848 and is one of the
world’s busiest commodities exchange, It was founded by a group of merchants, seeking
to bring order to the Midwest’s chaotic grain market, where prices were driven by season
as opposed to supply and demand, Out of this foundation grew the concept of a forwards.

- contract or futures contract, which enabled merchants to purchase at set prices for
delivery and allow farmers to protect their crops from volatile price swings by hedging
through commitment to future delivery at set prices, The CBOT has grown from its first
membership of 25 directors to in excess of 3600 members. It was founded as an

agricultural exchange and the first non-grain futures contract was not traded until 1968.





Tom Bagley

February 1, 2012

Dear CME’ GROUP,
I grew up on a dairy. farm. My family used the CME and CBOT products via
open outcry for the past 40 years. They still use the method today.
We appreciate the floor community and the knowledge they provide.
Sincerely,

Tom Bagley

tombagley@aoLcom



Jason Linn

THE LINN GROUP, INC.
Chicago Board of Trade
141 W. Jackson Blvd, 12204
Chicago, DL 60604

Phone: 800-548-5580". ~

Match 23, 2012
Dear CME GROUP,

The Agricultural futures markets are more than an agricultural financial
instrument for black-box's to churn out volume. They are here to protect producers and
users first and foremost with the pits in Chicago needed for REAL Liquidity and
Transparency by their market makers every day in every global situation,

If the floor goes away - only a matter of time before the HFT goes away as well -
CME group should be smart enough to realize that without real customers and matket
makers they don't have a product and the stockholders will run. Sometimes the best
business decisions are not the ones for a quick buck - but the ones that keep you in
business for generations with a solid foundation,

There is a mix of screen and pit that works - but today the screen has been given
all advantages and the pits have been placed behind the 8 ball.

CME group can tum this around - at least we hope they do — hopefully they have
the foresight,

Sincerely,

Jason Linn , ,

cet pmernal doy peuties hog hl oceans tee et '

jricbot@linngroup.com

1
ceocge teat ue pilin Have been placed belied the 8 bali.



EXHIBIT A


Becember 24, 2012

las a market maker an the grain floor of the Chicago Board of Trade. | support the current settlement
method and do not want it to be altered, | want settlement prices to be determined by open-cutcry
trading in the pit on the close.

‘Thank you for your consideration m this matter,

1) Ae

ga
(frated Ww Bred Ae

ia



other floor traders, will lose business almost immediately and will have to close their
operations forever. As a result of this change, hundreds of jobs supported by these
traders, including their clerks, runners, information technology and other support staff
wiil— and are being - eliminated.

5. Defendants’ decision to make this change is in violation of their fiduciary
obligations to Plaintiffs as Class B shareholders of the CBOT and shareholders of the
CME by failing to take steps to maintain and support the open outcry system as required
under the respective certificates of incorporation of the CBOT and CME.

6. Accordingly, in this action Plaintiffs seek (1) an injunction (a) requiring
the CME and CBOT to suspend all revisions to settlement procedures that would require
settlement prices to be determined by blending pit closing volume with electronic volume
electronically, and (b) enjoining them from altering the CBOT procedures or rules in any
manner that would change the way in which, settlement is conducted and which would
diminish or eliminate open outcry trading in the pits, or that otherwise cause substantial
harm to Plaintiffs! ability to contime to do business and trade on the open outcry system;
and (2) final judgment awarding them damages and other relief as the Court may deem
appropriate.

The Parties, Jurisdiction and Venue

7. Plaintiffs are professional traders (“Traders”) or brokers (“Brokers”) who
trade and/or fill orders in the Agricultural futures pits on the CBOT, and have done so for
years, or own businesses that employ other traders in the pits along with numerous staff
such as clerks, runners, information technology professionals and others. The Traders’

livelihood and primary employment is derived from trading derivatives in the CROT’s



December 25, 2011

(am a market maker on the grain floor of the Chicaga Board of Trade. 1 support the current settlement
method and do nat want It to be altered. | want, settlement prices 10 be determi ned by open-outery
trading in the pit on the clase.” Ce vee

Thank you for your consideration In this matter.

hhh ee

nope nncthr etme

i
:





December 29, 2011

Terrence Duffy
Executive Chairman
OME Group

30 South Wacker Brive
Executive Suite
Chicago Il, 60508

Dear Terrence Duffy:

My name is Matthew Todd (MTR), a current tradercustomer at the CME Group. [n 1998 | moved from
Ohio to Chicago after graduating coftega in hapes of becoming a Commiodilies Trader, in late 1983 (
was hired by the CME as ¢ Pit Reporter, @ year later | was hired by a T-bill Trader as @ clerk and finally
after years of hard work and saving money, (went through membership and started trading in 2004 in
the Lean Hog pit

| am waiting you today to express my concem over your proposed change in settlement

procedures in a number of CME and CBOT products.

As an active member of the Lean Hog community | feet that the current ptfopen outcry settiement
Procedures provide a iransparent forum for all participants to not only conduct business, but allows the
real market makers(fot takers) to provide the necessary Iquidity to 2 market that solely exists because
of thie liquidity. We ara market makers that hald posilons and provide the basis for why 8 futures
market and this exchange has survived for the ast hundred years.

fn conclusion, | feel maving the settlements to a sorean based solution will only provide mare room for
settlement manipulation and expose customers to more «isk, which will result in decreased volume and
put a wonderful nvestmentihedging toot at risk of being marginalized.

Thank you for your consideration,
Sincerely,

i

Matinew R. Todd.



We want NO electronic influence on agricultural livestock and grain trading prises,

Kan Christenson
Judy Christenson

KJF FARMS



Duffy’s income is derived from filling orders in the closing range with settlement
determined by open outcry orders. If the new settlement mule is adopted, Duffy will lose
the vast majority his livelihood and therefore his business as a broker will be ended,

56. Plaintiff Steven Loulousis is a Class B shareholder of the CBOT and
currently trades daily in the Corn pit at the CBOT. Loulousis has made his livelthood
trading in the open outcry arena at the CBOT for years, A large percentage of his
income is derived from trading the closing range with settlement determined by open
outery orders. If the new settlement rule is adopted, Loulousis will lose the vast majority
his livelihood and therefore his business as a trader will be ended.

57, ‘Plaintiff Mark Telander is a Class B shareholder of the CBOT and
currently trades daily in the Com pit at the CBOT. Loulousis has made his livelihood
trading in the open outcry arena at the CBOT for the past 4 years. A large percentage of
his income is derived from trading the closing range with settlement determined by open
outcry orders. If the new settlement rule is adopted, Telander will lose the vast majority
his livelihood and therefore his business as a trader will be ended.

58. Plaintiff Mark Rothschild is a Class B shareholder of the CBOT and

. currently trades daily in the Com pit at the CBOT. Rothschild has made his livelihood
trading in the open outcry arena at the CBOT for the past 14 years. A large percentage
of his income is derived Som trading the closing range with settlement determined by
open outcry orders. If the new settlement rule is adopted, Rothschild will lose the vast
majority his livelihood and therefore his business as a trader will be ended.

59. Plaintiff James F. Harkness is a Class B shareholder of the CBOT and

currently trades daily in the Com pit at the CBOT. Harkness has made his livelihood

45



dason Caplan

1610 Gordon Terrace
Deerfield, iL 60015
December 22, 2014

Terry Dufty

CME Group

144 W Jackson
Chicago, IL 60604

Dear Mr. Duffy:

As an active member of CME Gioup for over 7 years, and a shareholder since going public, I'm
shocked to leam the blantent disregard for your clients and shareholders concems regarding
Market transparency and settlement procedures,

Market transparency has been subjected to constant manipulation since a majority of the trading
volume In the Lean Hog Market has migrated to the electronic platform. The size and price
of both the bid and sell side are placad there to cause & major market move which fulfills their

objective, and then to ultimetly remove their markets causing a drastic move In the reverse - -* ~

direction. No market transparency, just manipulation |B

The tast remaining true market price thal the customers can rely on is pit setttement. {tis not
affected by algorithms, and flash trades, It is only affected by the true supply and demand of .
Its customers. if you question that statement, research the percent change where the market
opens up the following day.

Its tims that ihe CME Group stop woring about lining the packets of certain board members,
and remember that this exchange, and most of thelr products were invented to protect the
CUSTOMER from risks er canirol and the ability to hedge thelr fivelihond,

Sincerely,

Jason C:



Oecember 21, 2011

| ama market maker on the grain floor of the Chicago Board of Trade. | support the current settlement
method and do not want it to be altered, | want settlement prices ta he determined by open-outcry

trading [a the pit on the close.

Thank you for your consideration in this matter.

theb FYI (8)

+ nia suv Wr your consideration in this matter.



Evelyn Felt
Al Felt

15815 Marion Center Rd

Decatur, IN 46733-9605

EvelynFelt@ideal-builders.com

We Oppose Change the Settlement method for our Cor Products at the CROT.

Thank you,

Eveiyn Felt



{inchuding, for calculation purposes, volume from Exchange-For-Physicals transactions in such open outcry
market),

‘The commitment to maintain opta outcry markets set forth in this Section E of Article [V will not apply to
markets introduced after the Effective Date.

F. Exercise Rights. Subject to the terms and conditions of this Section F of Article IV of this Certificate of
Tacorperation:
1, Each holder of record on the official books snd records of the Corporation as of May 29, 2007 of ()a
Series B-1 Membership in respect of which an Exercise Right Privilege (a3 defined in Rule 210(b) of the .
Rules) is issuable but has not been issued or (II) both (a) one or more Exercise Right Privileges and (b) a“
t Series B-I Membership shall have the right, exercisable during the forty five (45) day period (the “Offer
: Period”) immediately following the effective time of the merger of CBOT Holdings, Inc. (“CBOT Holdings”)

. . with and into Chicago Mercantile Exchange Holdings Inc, (“CME Holdings”) pursuant to the terms of that

z certain Agreement and Plan of Merger, dated as of Octaber 17, 2006, as amended, among the Corporation,
CBOT Holdings and CME Holdings, to sell any such Exercise Right Privilege to the Corporation for an
amount equal to $250,000 in cash (a “Purchase Offer”). In arder to exercise the Purchase Offer, such holder
must deliver to the Corporation prior to the expiration of the Offer Period (i) the Exercise Right Privilege and
(ii) a duly executed assignment agreement in the form attached to this Certificate of Incorporation as Annex A
(the “Assignment Agreement”}. The Corporation shal! make payment as provided in this Section P.1 to a
holder who makes the required delivery of the Exercise Right Privilege end Assignment Agreement within
thirty (30) days after the expiration of the Offer Period,

2. In the event of a Final Resolution (as defiaed below) pursuant to which the Class Members (as
defined below} receive a recovery of cash, marketable securities or other property or rights with respect to
cach Exercise Right Privilege held by a Class Momber and/or retain or are declared ta have property or rights
with respect to cach Exercise Right Privitege held by a Class Member (collectively, a “Pex ERP Recovery”)
with an aggregate Fair Market Value (as defined below) less than $250,000, the Corporation shail pay fo cach
such Class Member with respect to cach such Bxercise Right Privilege held by such Class Member an amount . :
cqual to the difference between $250,000 and the Fair Market Value of tho Per ERP Recovery so received or :
setained, as applicable, by such Class Member with respect to such Exercise Right Privilege held by such ° ‘
Class Member (a “Balance Payment”). In order for a Class Member to receive @ Balance Payment with respect .
to an Exercise Right Privilege, such Class Meraber must provide evidence reasonably satisfactory to the H
Corporation that such Class Member received the Per BRP Recovery pursuant to the Final Resolution with
respect to such Exercise Right Privilege. The Corporation shall make payment to such holder prior to the later
of (1) thirty (30) days after dclivery of the sufficient evidence contemplated by the immediately preceding... .
sentence or (ii) thirty (30) days after the date the Fair Market Value of the Per ERP Recovery is determined in
accordance with the terns of Section 5(¢) of this Section F of Article IV of this Certificate of Incorporation.

3. In the event of the entry of a Zero Judgment (as defined below), the Corparation will pay ta each H
Non-Recovery Class Member (as defined below) $250,000 for cach Exervise Right Privilege held by such Il
‘Non-Recovery Class Member, ‘The Corporation shall make payment to a Non-Recovery Class Member within H
thirty (30) days after the date the such person's status as a Non-Recovery Class Member is determined in
accordance with the terms of Section 5(g) of this Section F of Article IV of this Certificate of Incorporation.

4. Notwithstanding anything to the contrary contained in this Section F of this Article IV of this"
: Certificate of Incorporation, in no event shall the Corporation be required to pay in excess of $250,000 in
_ ..  Tespect of any single Exercise Right Privilege. . :
5. For purposes of this Section F of Article IV of this Certificate of Incorporation, the term:

(a) “CBOE Litigation” meas that litlgation captioned CBOT Holdings, Ine,, et al, v, Chicago
Board Options Exchange, Inc., et al., Civil Action No. 2369-VCN (Del. Ch Ct);

&) “Class Member” means (i) if. class is certified by the Court in the CBOE Litigation, any
member of such class or (ii} if a class is not certified by the Court in the CBOE Litigation, any person or
entity who satisfies the definition of a member of the class es set forth in the Complaint, $0 long as the
Exercise Right Privileges purchased by the Corporation pursuant to this Section may be used by 2
member of the class to participate in a Final Resolution (provided, however, that in no event shall
CBOE or eny direct or indirect transferee of an Exarcise Right Privilege fom CBOE be considered a
“Class Member” for purposes of this Section F of this Article IV of this Certificate of Incorporation);



|

Chris Myers
‘775 Ridge Lake Bivd
Memphis, TN 38120

Janvary 17, 2012

Dear CME GROUP,

Asan active customer with a family FARM and family owned GRAIN ELEVATOR, |
am writing to voice my strong opposition to the proposed change in the mule regarding
settlement procedures ia the CME and CBOT agricultural contracts, When clectromic
trading was introduced, I was excited about the new platform to enhance agricalttral
markets. The marketplace was Jed to believe there would be 2 venues that were
transparent, equitable and liquid. What you have now is 2 diluted markets that are not
held to the same mules. Electronic markets are not on an even playing field and these
destructive practices have driven needed participants to use other methods of trading and
hedging. The poor decisions being made will affect the marketplace and ultimately the
jobs that support the industry.

J appreciate the liguidity and trensparency currently used with pit settlements; and feel
the use of electronic trade is easily manipulated. By passing this rule, you will give more
power to the clectronic trade that menipulated and compromised the integrity of the grain
and livestock contracts.

Sincerely,

Chris Myers



i
i
;

December 24, 2021

lam a market maker on the grain floor of the Chicago Saard of Trade. | support tise current settlement
method and do not want It to be altered. (want settlement prices to be determined by open-outcry
trading in the pit on the close.

Thank you for your consideration in this matter.

Si SAY |

DSk ;

Ns ns a MA i Ml “



Robbie Russeil

BMI Group, LLC

775 Ridge Lake Blvd,
Suite 450

Memphis, IN 38120

January 17, 2012
Dear CME GROUP,

As an active customer, both grain and livestock farmer aod grain elevator, I an writing to
voice my strong opposition to the proposed change in the rule regarding settlement
procedures in the CME and CROT agricultural contacts. When clectronic trading was
introduced, I was excited about the new platform to enhance agricultaral markets. The
marketplace was led to believe there would be 2 venues that were transparent, equitable
and liquid. What you have now is 2 diluted markets that are not held to the same mules.
Electronic markets are not om an even playing field and these destructive practices have
driven needed participants to use other methods of trading and hedging. The poor
decisions being made will affect the marketplace and ultimately the jobs that support the

industry,

L appreciate the liquidity and transparency currently wsed with pit settlements; and feel
the use of electronic trade is easily manipulated, By passing this cule, you will give more
power to the electronic trade that manipulated and compromised the integrity of the grain
and livestock contracts. :

Sincerely,

Robbie Russell



i

TSANG OO,

(BLM) AOS PAA © Lens CHG) AOS SEES © 1-800-700-4149 * 3310 140 Wesl + Suite (00 + Amarillo, Texas 79102

To Whom It May Concern:

We here at Tejas Trading Co, are concemed about taking. pit seltiement out of the
physicat pit and placing it in the hands of computer algorithms, We believe the current
system used via open autory is fair and has worked well for years. ARer all Open outery
has been around since the CME’s inception and we believe it should stay,



Brian Shaughnessy

April 30, 2012

Dear CME GROUP,

It's’ shame 6, Céinpiiters iviake up most

. of the yolume and make decisions without human intervention, Algos have deeper

pockets, have faster computers, and have severs right next to exchange servers
putting smaller traders at a disadvantage. What a pit trader would get massive fines
for and even jailed for in the past is now done 10's of 1000's of times a day by
algos. FRONTRUNNING! ,
Computer trading = front running, manipulation, end an uneven playing field.
Siucerely,

Brian Shanghnessy don't do te trading amenare Csnpatlers Herken

selh78@yahoo.com

va Kua itbitiniNGl =

Cf Garke FLU



Gmnail - Protect the pit ; ; Page 1 of L

G M i | Alan Young <alyajy1@gmait.com>

Protect the pit

4 message

Anthony Dina <tunadod@camecast.net>
To: "ajyajy 1@gmail.cam” <ajyajyi @gmal.com>

CME Group, oe

As an A & B shareholder an a active customer of the CME Group, [ am writing te voice my strong opposition
to tha proposed me change regarding settlement procedures In a variety of CME and CBOT products. The
Current method of pit and open outery settlement adequately meets my needs, Furthermore, | appreciate the
liquidity and transparency currently offered with pit settlement.

Tue, Dec 27, 2014 at 8:56 AM

Thank you for your consideration, .
Anthony J. Ding Jr, (TUNA)

Sent from my iPhone

https://mail. google. com/mait/u/0/?ui=2 &ik=02a70700b8&view=pt&cat=protecting 420th... 12/27/2011



@CME Group

Special Executive Report

. 312,930.3208 or Julie.Holzrichtet youp.com or to Dean Payton, Manag

$-6048 December 12, 2011

Forthcoming Revisions to Settlement Procedures
for CME and CBOT Agricultural Futures

{n the interest of enhancing procedures for the determination of settlement prices in CBOT and

CME agricultural futures, CBOT and CME wilt be making modifications to their respective —

settlement procedures in the following futures contracts:
CBOT: Corn, Soybeans, Soybean Oil, Soybean Meal, Oats, Wheat and Rough Rice
CME: Live Cattle, Feeder Cattle and Lean Hogs

Presently, settlement procedures In most of these contracts rely on Floor-based activity, while
Wheat (first five contract months) and Rough Rice rely exclusively on Globex-based activity. The
basic approach of the new methodologies will be to include additional information in the settlement
calculation by incorporating both Floor and Globex activity in the determination of settlement
prices,

Additional detalls regarding the specific settlement methodologies and the timelines for rollout in
the various products will be communicated early in 2012. It is currently anticipated that the
transition to the new settlement procedures will occur during March and April 2012, subject to
relevant CFTC regulatory review periods.

Questions may be directed to Julie Holzrichter, Managing Director, Global Operations at

Regulation at 312.435.3658 or Dean.Payton@cmegroup.com, "|

For media inquirles conceming this Advisory Notice, please contact CME Group Corporate Cornmunications at
312.930.3434 or naws@icmegraup.com.

ing Director, Market



December 21, 2011

tam a market maker or the grain flor of the Chleago Board of Trade. i support the current settlement
method and do not want it to be altered, | want settlement prices to be determined by open-outrry
trading tn the pit on the clase.

Thank you for your consideration in this matter, .

= soot saeer any the grain floor of the Chicago Board at Trade I support the current seftlence-

ante finance

if
H
t

}
i
}



” December 24, 2011

| am a market maker on the grain floor of the Chicago Board of Trade. ! support the current settlement
method and do not want it to be altered. | want settlement prices to be determined by open-outcry
trading in the pit on the cinse.

Thank you for your cansideration In this matter.
Lanes Gorman - J¢G - X1%

fy,

mcm ON EVD



Nature of the Action
1, Plaintiffs have been forced to bring this lawsuit against Defendants for
injunctive and other relief in order to obtain redress and protect their jobs and livelihoods
and those of the CBOT’s members, who are shareholders of the CBOT and CME and
trade agricultural futures and derivative contracts on the open outery floor exchanges of
the CBOT ~ known as the “pits”.

2. Historically and to date, one of the main functions of the open outery

system in the “pits” — and those who trade on the CROT and the CME floor — is to -

determine final settlement prices at the end of the trading day based upon supply and
demand of competitive orders placed by traders, brokers and customer end users either
verbally or in writing during a designated closing range time period.

“3 Defendants have violated their fiduciary and contractual duties to
Plaintiffs by taking actions they knew and know will almost completely eliminate the
demand for the open outcry system, thereby eliminating the vast majority their
businesses, jobs and livelihoods (and those of their staff}, and reducing the value of their
Class B shares in the CBOT.

4. / Specifically, the CME has announced i in May, 2012, that the CME and
CBOT intend to implement a change to its procedures for determining settlement prices
whereby all final price settlements are to be determined by using an algorithm based on a
mixture of floor and Globex (electronic trading) information, instead of based on floor-
based trading activity for CBOT Agricultural Futures. This will cause — and as this
complaint was filed, has already caused - a rapid, dramatic decrease in trades being sent

to the Plaintiffs in the “pits,” with the result that they, and the overwhelming majority of



if

December 21, 2011

lam a market maker on the grain Floor of the Chicago Board af Trade. | support the current setttement
method and do not wart ft to be altered. |] want settlement nt pricesto be determined by open-outcry

D Sy -
wa Dawe J. fe

Thank you for your consideration In this matter,

bas >vod dd

'
i
i
i



Wiiliam Conover
INTL /FC'St6ns

230 South LaSalle,
Suite 10-500
Chicago, IL. 60604
Phone: 312-780-6700

January 24, 2012

Dear CME GROUP,

‘. Thé'niarket works best wlien side by side, not one or the other, The floor is a
necessity to keep the markets in line]

Sincerely,
William Conover

wleonover@hotmail.com

Phe tacket wurks best when side by sike. bel one or lie alber. Cie tines >



i
{
| ‘To CME Group,

As an active customer of the CME Group, 1 am writing to voice my strang epposition to the proposed
rule change regarding settlement procedures in a varlety of CME and CBOT products. The current
methad of pit and open outcry settlement adequately meets my needs. Furthermore, | appreciate the
fiquidity and transparency currently offered with pit settlement. ,

Thank you for your. consideration.

WLE Faas

Aa

4
4



December 22, 2031

lama market maker on the grain floor of the Chicago Beard of Trade. | support the current settlement
method and do not want it to be altered. | want settlement prices to be determined by open-outery

trading In the pit on the close: .

Rite +

Thank you for your consideration in this matter,

Rory ° ‘Donne \\

€, 4

RPO

PON



SCHOENBERG, FINKEL, NEWMAN & ROSENBERG, LLC

ee Jeomvey

By:
One of Plaintifis’ Attorneys wa

George E. Sang

Richard Goldwasser

William R. Klein

Schoenberg, Finkel, Newman & Rosenberg, LLC
222 S. Riverside Plaza, Suite 2100

Chicago, [L 60606

342/648-2300

Firm LD, 43280

29



effectuate a blended settlement procedure for the CBOT Agricultural Futures markets has
never been submitted to, much less approved by a majority of the voting power of the
outstanding Series B-1 Membership and Series B-2 Memberships, voting together as a
class. In addition, the Certificate provides that the open outcry markets cannot be
discontinued unless the CBOT Board of Directors determines that the open outcry
markets are no longer liquid or a majority of Class B shareholders votes in favor of a
change, neither of which has occurred.

90. If Defendants implement and do not reverse the changes in settlement
procedures from a floor based settlement to a blended weighted volume with electronic
pricing, there is a significant and real likelihood that the open outcry system will become
obsolete.

91, Unless the CBOT, by and through its Board of Directors, officers and
agents, takes action to comply with their respective fiduciary duties to protect Plaintiffs’
interests and investment in the company and with its contractual obligations to maintain
and. support the open outcry market, Plaintiffs will be seriously and irreparably harmed,
They will face the loss of their and their employees’ livelihoods and their businesses, and
also suffer significant losses as a result of plummeting values in their investments in their
Class B shares.

92, There is no adequate remedy at law for the Plaintiffs’ losses, especially for
the loss of their livelihoods, businesses and jobs for their own employees and staff, many
of whom have no other transferable skills or training in other fields.

~ WHEREFORE, Plaintiffs request the following relief:

(3) Atemporary, preliminary and permanent order:

25



December 23, 2011

Jam a market maker on the grain floog,
¢ethod and do not want it to be altered, | want settlement prices to be determined by open-outrry
trading in the pit on the close.

Thank you for your consideration In this matter,

a

coltederd Tomtnt settlerasey ect es teh i tecipie cd te crete see

10 Board of Trade. {support the current settlement

H
|
|
'
|
|
|



(1) the allocation of products that a holder of a specific Series of Class 8 Membership is penmitted
to trade on the exchange facilities of the Corporation (including both the open outery trading system and
the electronic trading systema), .

(2) the requirement that, except as provided in that certain Agreament, dated August 7, 2001,
between the Corporation and the Chicago Board Options Exchange (the “CBOE”), as modified by that
certain Letter Agreement, dated October 7, 2004, between the Corporation, CBOT Holdings, Inc, and
the CBOE, in each case, as may be amended from time to timc in socordance with their respective
terms, holders of Class B Memberships who meet the applicable membership and eligibility
requirements will be charged tnmsaction fees for trades of the Corporation’s products for theie acconnts
that are lower than the transaction fees charged ta any participant who is not a holder of Class B
Membership for the same products, whether trading utilizing the open outery trading system or the
electronic trading system,

(3) the membership qualifications or eligibility requirements for holding any Series of Class B
Membership or exercising any of the membership tights and privileges associated with such Series,

: (4) the commitment to maintain open owtery markets set forth in Section E of Article [Y of this
Certificate of Incorporation, which nmst be approved by @ majority of the voting power of the
outstanding Series B-1 Memberships and Series B-2 Memberships, voting together as a class, or

(5) the ability of a Class B Member to engage in dual-trading, unless stich amendment to the
Bylaws or Rules is required, in the opinion of counsel, by applicable Jaw or governmental rite or
Teguiation.

Por purposes of Section 19(2)(b)(1) of Article 1V, the allocation of products that the holders of any Series of
Class B Membership are permitted to trade on the exchange facilities of the Corporation shall be deemed to be
adversely affected only if a product is eliminated from the allocation of products the holders of a particular Series of
Class B Memberships aro permitted to trade.

(©) Following the date of filing of this Certificate of Incorporation, and unless otherwise agreed to by the
Series B-l Members and the Series B-2 Members voting together as a single class in accordance with Section
C of this Article IV, the Corporation shall use commercially reasonable efforts to preserve the Exercise Right
for the benefit of the Series B-1 Members and their delegates, including (i) defending any actions, suits or
proceedings brought to challenges all or sny portion of the Bxercise Right and, in the event of an adverse roling
of determination, pursuing reasonable grounds for appeal, (ii) taking reasonable steps, including instituting
actions, suifs and proceedings and pursuing reasonable grounds for appeal, to secure for the Series B-1

Members and their delegates that have exercised the Exercise Right the right to receive any dividends ar other .,

distributions to be made by the CBOE to its members and (iit) complying with the Corporation’s obligations

under agreements with the CBOB regarding the Exercise Right, including making available to the CBOE the
information specified in any such agreements or any surveillance plans with the CBOE; provided thatthe

Corporation shall not be required in connection with its obligations under the foregoing clauses {i} and (li) of
this Section D(2)c) of this Article {V of this Certificate of Incorporation to contribute to any settlement or
satisfy the obligation of any third party.

(d) On any matter on which holders of Series B-1 Memberships and Scries B-2 Memberships are
entitled to vote pursuant to paragraphs (a) and (b) of this Section D(2) of Article IV, such holders of Series B-
1 Memberships and Series B-2 Memberships shali be the only members af the Corporation entitled to vote
thereon. Holders of Series B~1 Memberships and Series B-2 Memberships shall have no other voting rights
excepf as expressly set forth herein end shall not have the right to take action by written consent in liew ofa
meeting and shall have no right to initiafe any proposal, at or for any meeting of members, One-third of the
total voting power of the Series B-1 Memberships and Series B-2 Memberships preseat in person or by proxy
shall constitute ¢ quorum at any meeting to take action on the matters as to which such holders are entitled to
‘yote pursuant to paragraphs (a) and (b) of Section D(2) of this Article LV, Series B-3 Memberships, Serics B-¢
Memberships and Series B-5 Memberships shall have no right to vote on any matters ar to initiate any
Proposals at or for any meeting of members, For purposes of any vote of the holders of Series B-1
Memberships and Series B-2 Memberships permitted by this Certificate of Incorporation, the Board of
Directors of the Corporation shall be entitled to fix a record date, and only holders of record as of such tecord
date shall be entitled to vote on the matter to be voted on.



December 22,2011 -

lam a roarket maker on the grain floor of the Chicago Board of trade. | support the current settlement

method and do net want jt fo he altered, | want settlement prices to be determined by open-outcry
trading in the pit on the close,

Thank you for your consideration In this raatter,

ET GL. Fe nent

1 oa Uy fly Veet



|
|

To: CME Group

The CME group hag to look at the purpose of settlement. Any proposed change that cauld affect the
health and integrity of the markeiptace should be considered by all participants and not just 2 select

few. | do not feal thé CME group ha’s a valid reason to change the price settlement policy, ather thas to “

accommodate a small group of people at the expense of thousands of others! The CME group needs to
took at the good of the whole, not just what is good for them, It seems one or two customers feel the
need to skew the market unfairly. Finally, this exchange wes founded and built on fair and equitable
markets by thousands of hardworking and conscientious people, We welcome an open. wiscussion by a
panel of participants: brokers, traders, end users, hedgers and producers, to find an equitable solution
ta this situation.

Sincerely,

ame. Member



December 21, 2011 '

lama market maker on the grain floor of the Chicago Board of Trade, { support the current settlement
method and do not want it to be altered. | want settlement prices to be determined by open-outcry
trading in the pit on the close,

Thank you for your consideration In this matter. i fp f *

H
1
|
i
Fa



141 W Jackson Blvd #2210

Chicago, IL .
Phone: 312-655-1724
January 23, 2012

Dear CME GROUP,

Although there are benefits to Globex, the negatives are slowly starting to
become larger and harder fo forget about. The lack of transparency and increase
sed DY Hedy b Gila, MishaS Aditekard for using the market as it should be used.
For over 150 years this place has set grain prices and allowed buyers and sellers fo
hedge. It is slowly becoming impossible as these high frequency traders make
Prices move to unrealistic prices.

Sincerely,

Brett Engelmann

bengelmann@rcegdirect.com

asarey bedwelinds, Ibat have no regard for using the imarket as te sHudtd ds io.

My Le Tbe



VERIFICATION
Under penalties of perjury as provided pursuant to Section 1-109 of the Illinois
Code of Civil Procedure, the undersigned hereby certifies that I am one of the Plaintiffs
in the above-captioned matter, that the matters set forth in the foregoing Verified
Complaint are true and correct, except as to matters alleged fo be on information and
belief, which the undersigned certifies as aforesaid that she verily believes the same to be

true,

SUBSCRIBE) and SWORN to before
me this _9,\~ "day of lume, 2012. OFFICAL SEAL

Jere 2 Swng

Notary Public

Rotary Pubtie » State of lnots
My Corrmmisston Expires Apr 8, 2016



Fi December 21, 2034" *

1 iam a market maker on the grain floor of the Chicago Board of Trade. j support the current settiement
| method and do not want it to be altered. t want settiement prices ta be determined by: opervoniry
trading In the pit on the close. - = woe

Thank you for your consideration In this matter.

reeds

i
q



43, Historically when such changes have been made in other futures contracts
markets, in excess of 90% of all trading volume has moved to the electronic system,
creating job loss and weakening liquidity in these contracts,

44, An electronically weighted volume settlement procedure has been in effect
for the Wheat pit since 2009. Prior to a weighted volume settlement rule the Wheat pit
contained in excess of 200 brokers and traders all COT members, including a number of
Plaintiffs, in addition to the hundreds of employees of these members, As a result of the
adoption of the electronically weighted volume settlement procedure for the Wheat pit,
the open outcry market for the Wheat pit almost immediately ceased to exist. As of 2012,
there are Jess than 10 members participating in the open outery market in the Wheat pit.

45. As 2 result of electronically weighted settlement, Wheat prices have
experienced more yolalile closing ranges thart it previously had.

46. The Oats Pit at the CBOT implemented VWAP for its settlement in
December 2011. ‘To date in 2012, the open outery volume is down 94%,

47. Plaintiff Joe Fasano, has been a Class B shareholder of the CBOT for 15
years, a shareholder of the CME, and a broker in the Corn pit at the CBOT. Fasono’s
open outcry orders alone represent 5% of the total yolume traded world wide daily in the
Com pit. Fasono’s closing range orders represent 95% of his business. Fasono’s
customers have communicated to him that they will no longer participate in the open
outery arena after the implementation of the proposed blended settlement rule. Fasono
will therefore have his entire brokerage business destroyed. Fasano also traded in the
Wheat pit prior to the adoption of the electronically volume weighted settlement rule for

the Wheat pit. After adoption of that settlement procedure Fasano was unable to earn a

12



Henning&Carey LLC

Brian Herald
HENNING & CAREY TRADING
141 W Jackson Boulevard
Chicago, IL 60604-2929

Janmary 24, 2012

Dear CMB GROUP,

I think the floor adds a valuable service to the market, If we eliminate it we
might as well be called the New York Merchandise.

Sincerely,
Brian Herald

bherald76@hotmail.com

My Mab pl Mage Yat Ra to E



‘
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}
i

Kathleen Marshall

March, 7, 2012

Dear CME GROUP,
As an active customer atid trader, faimer, rancher, producer, grain elevator,

hedger, or end-user, I am writing to voice my strong opposition to the proposed
ipgettiement: procedures in the CME and CBOT

ry

change in the:rule: re
agricultural products,

When electronic trading was introduced I was excited about the new -
platform to enhance the agricultural markets, The marketplace was led fo believe
that there would be two venues that would be transparent, equitable and liquid.
What you now have. are two diluted, illiquid markets that are not held
to the same rules and ethics. These destructive practices have driven the needed
participants to use other methods of trading and hedging. The decision to switch to
a blended-setttement or an electronic settlement will inevitably negatively affect
the market volume and ultimately the jobs that support the industry.

. I appreciate. thesdiquiditycand transparency currently employed in pit
settlements. I feel the electronic market would be used to easily manipulate the
settlement process thereby diminishing the integrity of the grain and livestock
markets. I feel that pit settlements a superior method of end of day pricing. The
leverage the CME has given to computer algorithms has and will continue to erode
the integrity of the grain and livestock contracts. -.

Sincerely,
Kathleen Marshall

wheezy369@hotmail.com



27. Current open outery customer orders are entered on a time of entry basis,
and these orders are filled on a first in first out basis with the broker during the closing
range, thereby bringing a substantial certainty to their execution,

28. By contrast electronic orders are not filled on a first in first out basis. The’
order filis are detexmined on a split first in first out/pro-rata algorithm basis, thereby
allowing large volume and high frequency traders to assume a greater market share on a
less competitive basis.

29, The higher volume electronic participants pay reduced commissions and
receive assurances of greater market order share which can therefore substantially bypass
smaller orders in a fractional second, although the smaller order may have been in place
all day.

30, The effect of the proposed blended settlement rule will make current open
outcry market participants of no import and deter further participation in that arena. ;

31. The CBOT and the CME have historically operated on an open outcry
system. :

32. Effective on or about May 29, 2007, the CBOT’s parent, CBOT Holdings,
Inc., merged into the CME, then known as Chicago Mercantile Exchange Holdings, Inc.,
and the CBOT became a subsidiary of the CME.

33. In order to induce CBOT members to retain their memberships at the time
of the merger, both the CBOT and the CME represented to the CBOT members,
including Plaintiffs, that the CBOT and the CME were committed to maintain open
outcry markets, Prior to, and at the time of the merger, the CBOT and the CME

represented to the CBOT members that the CME and the CBOT were committed to



ve

December 21,2041 _ _

{ama market maker on the grain floor of the Chicaga Board of Trade. | support the current settlement
method and do not want It to be altered. | want settlement prices te he determined by open-outery
trading in the pit on the close. . . . .

Thank you for your consideration inthis matter,

oe wr; °
oN gt



" Dear CME GROUP,

Kerrick Wilson

KER-SON FARMS
14770 State Route [23° -
Somerville, OH 45064-9620

Phone: 937-409-5858

March, 27, 2012

I think there is too much speculation going on in the markets. We are farmers that
sell grain and buy grain for our animals, I don't care for high prices, but I can’t believe
that as high as the last years, crop got back in the summer and fall of 2011 because of the
tight supply, weather! issues, and supply
and demand, and this year crop is smaller than last years. China has been buying more
corn than last year, drought in South America,

To me, those speculators are keeping the price low, for whatever reason. Just
seems like Supply and Demand should take care of themselves, (We have low supply and
wo have demand) not speculators.

Thank you, a concerned investor.

PA Ute eet ee ne

Sincerely,

Kerrick Wilson _

oedipal +

kersonfarms@aol,com

cee CUsAUATEEE Hol specdlalors.



December 22, 2011

jam a market maker on the grain flaor of the Chicago Board of Trade. § suppart the current settlement
method and de not want It te be altered, | want settlement prices to be determined by open-cotcry
trading in the git on the close. . :

Thank yau for your consideratlon in this matter.

hi pL.
Vn ye

i
4
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December 21, 2011,

tam a market maker on the grain floor of the Chicego Of Trade. t support the current settlement
method and do not want it to be altered. | want settlement prices to be determined by oper-outcry
‘wading in the pit on the close.

Thank yeu for your consideration inthis matter,

iv on

{
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Gmail - The Demise of the CME Group Page 1 of 1

. Gq th wr
Gre: il Alan Young <alyajyi@gmeil.com>

bd akyht

The Demise of the CME Group

1 message

James Ferrill <zzz284998@yahoo.con> Wed, Dec 21, 2011 at 1:04 PM
To: alyaiy1 @gmail.com

1 arm writing this jefter in regards to the petition being circulated on the floor against eliminating settiement prices
being derived via open outcry.
‘The open outcry system has been in place for as jong as we have been afive, Alive is the correct term to use in
this instance because it is exectly that which we ara Aghling for, our lives, Professionally and financially. We on the
the floor have seen the devastation wrought by the ellmination of open outery settlements. It has aliminated
countess positions at the CME Group. Using an aigoriihm to settle futures markets white eliminating the input of
the open outcry (pit) community is ridiculous, Who made this axchange what it is today? It certainly wasn't a
computer. They have had an impact, this much is clear. Good or bad Is in the eye of the behoider. When the flash
¢tash happened in the S&P futures, all the bide and offers dried up faster then you could say, “We're closed”, The
merket spread was dollars wide, Who filed the gap In liquidity? The locals in the pit, that’s who. Just tke they hava
for decades. .
We ail know what will happen to the fuluras products once they go fully electronic. The customer wilt suffer as well *
ag the exchange. Same think the exchange will benefit, They may, in the short tenn. In ihe long term however I
il the exchange will lose. te hava stepped up to

worst of times call far the best of te. in wild and extraordinary times the locals up to make
markets at the risk ot josing their enti net worth: Whore were the bide and offere when we noeded them in tho
flash cfash? Tha computers sat thal one out. Why should you deem them worthy of settiements when they don't or
won't maistain a liquid and orderly market when we need them the most?
Does no one listen to the people who are the capiains of this Industry anymore? | think Ihey should giva a good
fisten to the membership and not implement this hybrid settiement eystem,

https://mail.google.com/mailAv/0y Pulm 2&ik-Yan70700b8 &cview=pi&search=inboxath~ 13... 12/22/2011



To CME Group, VPARP - 77

As an active customer of the CME Group, | am writing to voice my strong opposition to the praposed
cule change regarding settlement procedures in a variety of CME and CBOT products. The current
method of pit and open outcry settlement adequately meets my needs, Furthermore, l appreciate the
liquidity and transparency currentiy offered with pit settlement,

‘Thank you for your consideration.

Lee TSRAC.



as Chief Executive Officer of the CME, announced that the CME intended to adopt the
new, proposed settlement methodology for Agricultural futures contracts for the CBOT.
See Exhibit D attached hereto. No similar proposed change has been adopted for the
Livestock futures market of the CME itself. On May 25, 2012, the CME issued a Special
Executive Report entitled “New Settlement Methodology for CBOT Agricultural futures
Effective June 25,2012.” A true and correct copy of the May 25, 2012 Special Executive
Report is attached hereto and made a part hereof as Exhibit F.

81. The methodology for determining closing settlement price for the CBOT
is determined by Rule 813 of the CBOT Rulebook, which provides in relevant part:

“Daily settlement prices shalt be determined each business day for each
product pursuant to one or more of the procedures set forth below. The
settlement price shall be a price consistent with the minimum tick
increment for the product; if the calculated settlement price is not a
standard tick increment, the calculated settlement price will be rounded
either to the nearest tick or to the tick closer to the previous day’s
settlement price. The procedure used to determine the settlement price of
a product will depend on the product group, level of activity and liquidity
during the defined cicsing time period, and the trading venue(s) used to
derive the settlement. To the extend that any members participate in the
creation of settlement prices, they agree to assign and transfer to the
Exchange any and all right, title and interest in and to the settlement
prices, including, but not limited to, all copy right in the settlement prices.

1, Midpoint of the Closing Range: In products that use this procedure, the
first trade and all subsequent trades, higher bids and lower offers that are
quoted during the established closing time period will be included in the
closing range. The midpoint of the high and low quotes in the closing
range will be the settlement price, If no trade occurs during the defined
closing period, the last quote of the day (trade, higher bid, lower offer)

will be the settlement price. In the event there are no valid quotes during

the day, the settlement price will be the prior day’s settlement price.”
Closing settlement prices for products in the Agricultural Futures pits have always been
determined based upon the “Midpoint of the Closing Range.” Eliminating the ability to

close settlement prices based upon the “Midpoint of the Closing Range” and requiring al!

21



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Tcarus Investments Mail - Fwd: Proposed CBT Soybean Meol and Soybean Oil changes Page | of 2

qr’
*
a i i Jennifer Mayer <jmayon@tcarustrading.com>

byGange
Fwd: Proposed CBT Soybean Meal and Soybean Oil
changes
4 message
From the Desk of Heather K <hk@icarustrading.com> ‘Thu, Dag 22, 2071 at 10:69 AM

Reply-To: hk@icarustrading.com
To: Jennifer Mayer <jmayer@icarustrading.com>

Forwarded message ——————

From: Mark Wikiuad <meatoil@amail.com>

Date: Wed, Dec 21, 2011 at 15:58 .

Subject: Proposed CBT Soybaan Meal and Soybean Oil changes
To: hk@icarustrading.com, Chris Conwell <cfoonwel@amail. com>

Jo whom it may concern at CME:

‘My name is Mark Wiklund, and my firm Wiklund Trading has been a member firn of CBT since 1983. We
primarily trade grain contracts, with most emphasis in Soybean Meal and Soybean Oil trade. This has been
our primary focus sitice 1986. We trade open outcry and electronic, both day and night. We make markets in
these commodities every day af the year,

My comment is this, the closing rotation rules and current settiement procedures work great. Do not fix
something that has worked so well for so many years.

The closing rotation process in Meal and Oil is the fairest to customers, These markets are relatively thin,
and market makers are necessary fo take the oppasita sida of these closing relatively large orders. These
customers have very large orders that are best filed by market makers on the floor making two sided markets
for size, Gn the computer these customers are unable to broadcast to the market that they want to buy or sell
in size. They want size bids and offers by market makers. This is what happens under tha current method
because market makers like ourselves realize the broker wants to move size, 80 our traders on the flaor
provide two sided size markets,

The second point | would like to maka is a natural follow up to my first point. Because these customers want
fo do size and market makers {ike ourselves provide size bid/apks to the brokers these customers naturally
want the market to setile at lha price they bought or sold the most quantity. Not some average of 60 seconds
worth of prices.

hope you will consider my comments. They are made In good faith as a fong time market maker in these
relatively thin markets, Please feel free to contact me if you have any questions on my comments, Thank
you.

Mark

Mark B. Viiktund
Managing Partner
Wiklund Trading, LLC
Suile 3430

141 W. Jackson lve,

hitps://mail.google.com/mail/?ui=2dcik=641 080453 7&-view=pt&search=inboxécth=1346... 12/22/2011



cElhig,

QOS) AGE-ZUAA © Pepe (HIM) GASP © $800 /D0-1149 « 3310 1-40 West + Suits 100 + Amato, Texas 79102

‘fo Whom it May Concern:
We here at Tejas Trading Co, are concerned about taking pit settlement out of the
physical pit and placing it in the hands of computer algorithms. We believe the current

sysiem used via open outcry is fair and has worked well for years. ARer all Open outery
has been around since the CME’s inception and we believe it should stay.

Thank You,



f
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Kelly King
January, 05, 2012,

Deat CME GROUP,

Thelieve wellregul pero
market model for agricultural commodities. I believe that commodity index
funds have no place in our markets. It is widely believed that they distort
prices. I believe that automated trading systems that compete against each
other and can manipulate a market faster than someone can think have no
place in food markets.

These two factors combined are responsible for the record high prices
we have witnessed in past years. And these high prices will be nothing if
there is a real natural catastrophe, which we have not faced since going
electronic in Aug. of 2006. There have been threats of drought and flooding
and late planting, but nothing like we saw in 1988 or 1993. Our skilled
brokers and locals created tight, liquid markets. In 1988 we lost 25% of the
com crop, it was the 3rd worst natural disaster in our country's history, and
we didn't go above § st bapmener now We, ibe trading $20 and
the planet would Shia null et pean’) markers e hould em ne ‘at the
speed of human thought. I don't remember any of these problems happening
10 years ago.

There is always room for oversight, but these markets are not
operating efficiently anymore... look at the failed Wheat market.

. Singerely, aj jn past veats, And these bieh oriees will be nother
Kelly King

kelly@sonictrax,com

cr ee
hese ood fare Poad and Fnerey meapate shots ld Ihe “banclins Aoetals

‘aAhighly efficient. and superior ~ ©"



trading in the open outcry arena at the CBOT for the past 10 years. A large percentage
of his income is derived from trading the closing range with settlement determined by
open outcry orders. If the new settlement rule is adopted, Harkness will lose the vast
majority his livelihood and therefore his business as a trader will be ended.

60. Plaintiff Thomas Fanning is a Class B shareholder of the CBOT, a
shareholder of the CME and currently trades daily in the Com pit at the CBOT. Fanning
has made his livelihood trading in the open outery arena at the CBOT for the past 14
years. A large percentage of his income is derived from trading the closing range with
settlement determined by open outcry orders. If the new settlement rule is adapted,
Fanning will lose the vast majority his livelihood and therefore bis business as a trader
will be ended.

61, Plaintiff Sarah McCarron has traded in the Com pit of the CBOT for
approximately 6 years. A large percentage of McCarron’s income is derived from trading
the closing range with settlement determined by open outcry orders. If the new

_ settlement ‘rule is adopted, MCarron will lose the vast majority her livelihood and
therefore her business as a trader wil] be ended.

62, Plaintiff A John Yavari owns 50% of Century Group Trading, which
clears certain CBOT’s members trades at the CBOT. If the new settlement rule is
adopted, Yavari’s income will be greatly affected by the loss of Traders in the
Agricultural Futures pits and his clearing business will be substantially impaired.

63. Plaintiff Mark McKenna is a Class B shareholder of the CBOT and
currently trades daily in the Com pit at the CBOT. McKenna has made his livelihood

trading in the open outcry arena at the CBOT for the past 19 years, A large percentage

16



Dacember 28, 2011

As a long standing customer and shareholder of the Chicago Mercantile Exchange,
am writing to voice my complaint about the proposed change in the settlernent
Procedures in tive cattle, feeder cattie and hog futures in the spring, | ama floor hraker
and trader and have a wide range of dients which include commercial hedge accounts,
customer business, IB's and hedge funds, a

lam aiso a co owner of Grainery Farms.We use the exchange to hedge over 7,000
acres of farmland in three different states, This reprasents over 2 million dollars in
annual grain sales.

We all belleve that the current pit based settlement is a key factor to our business and
a change to electronic or hybrid settlement would have a detcimental effect on all of our
business.
We believe the price discovery and transparency that Is achieved from open outcry is
superior to that achieved from electronic settiament procedures,
" [feat my own volume combined with the entire customer and filling business ido
represents a significant amount of volume. tam requesting that the CME revisit this

decision and take these facts into consideration to keep the current pit settlement
procedures In place,

Respectful
7



11, The CBOT provided for competitive bidding and selling of futures
contracts by open competition within its membership. Through its membership, the
foundation comerstone has become “My word is my bond”, The pricing of futures
contracts had over the decades been one of an open competition into the new millennium
by its community of trader and broker members. Buying and selling was not only
transparent but completed by a verbal acknowledgment which could be quickly recorded
and resolved in the event of a dispute between its members. The CBOT facilitated
commerce while bringing some order to food pricing in the futare.

12. As CBOT transformed itself from a not-for — profit concern to one of for
profit, it respected and acknowledged its history of those that built the CBOTC into one
of the world’s busiest commodities exchanges. As such the CBOT made a covenant with
its membership for a commitment to maintain open outcry markets. Its amended and
restated certificate of incorporation recognized the integrity of its traders and brokers by
this commitment to a system that had worked for businessmen, end users and farmers
alike.

13, Defendant Terrence Dufly (Duffy) is, on information and belief, an
Iinois resident and Executive Chairman and President of the CME.

14. Defendant Phupinder Gill (“Gill”) is, on information and belief, an Hlinois
resident and Chief Executive Officer of the CME.

1S. The majority of the actions giving rise to this complaint occurred in Cook
County, Iinois.

16. In order for a person to trade on the CBOT floor in the open outery pits, he

or she must become a member of the CBOT.



|
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3

Savana Butler

March 7, 2012

Dear CME GROUP,

As ap active conta cher, producer, grain elevator,
hedget, or end-user, I ‘am writihg to Voice my strong opposition to the proposed
change in the rule regarding settlement procedures in the CME and CBOT

agricultural products.

When electronic trading was introduced I was excited about the new ~

platform to enhance the agricultural markets. The market place was led to believe

that there would be two venues that would be transparent, equitable and liquid. ©

What you now have are two diluted, illiquid markets that are not held to the same
rules and ethics, These destructive practices have driven the needed participants to
use other methods of trading and hedging. The decision to switch to a blended-
settlement or an electronic settlement will inevitably negatively affect the market
volume and'ultimately thé jobs that'support the industry. °°

- I appreciate the liquidity and transparency currently employed in pit
settlements. I feel the electronic market would be used to easily manipulate the
settlement process thereby diminishing the integrity. of the grain and livestock
markets, I feel that pit settlement is a superior method of end of day pricing. The
leverage the CMB haswgivenrtowothptter-algotithms hasrand will cohtinue'to' erode
the integrity of the grain and livestock contracts.

Sincerely,
w+: SavahaiButlerss (he fabs that suppor slee nidints

yvanabanana93 @yahoo.com

Soba eel Gras BIH LO COaIpPLLSE Weg TMS Lass sid ei uid,



VERIFICATION
Under penalties of perjury as provided pursuant to Section 1-109 of the Tlinois
Code of Civil Procedure, the undersigned hereby certifies that I am one of the Plaintiffs
in the above-captioned matter, that the matters set forth in the foregoing Verified
Complaint are true and correct, except as to matters alleged to be on information and
belief, which the undersigned certifies as aforesaid that he verily believes the same to be

trus.

SUB: SCRIBED and SWORN to before

me this _Oa°* day of June, 2012.
OFFICIAL SEAL
GEORGE E SANG
Notary Publ - Stats of tele
G Uy Commission Explres Apr 6, 2016

Notity Public



Harley Sietsema

SIETSEMA FARMS cas
11304 Edgewater Dr. Suite A
Allendale, Mi. 49401

Phone: 616-895-7493

April 12, 2012 Hh) COMET UH LauTy Veaacs
Dear CME GROUP,

I agree with this petition. The market is being run by those who have very
littie, if anything to do with the actual trading of the commodities involved.
Let’s get this system back to what it was originally intended for!

Sincerely,
Harley Sietsema

hsietsema@sietsemafarms.com



Any business thrives when it is responsive to its

customers, when their interests are considered and protected.

As a shareholder of the CME Group as well as a floor
trader, I and a sizable group of my peers have felt that our
view points have not been honestly and legitimately
considered.

A major settlement decision is about to be enacted
without customer input or impact studies.

As.a customer that would directly be affected,

I ask that instead of a rush to decision, a panel of floor
users and customers be given a chance to voice their
positions.

As electronic trading makes it easy to trade at any
change, this exchange should evaluate how important the
floor population is to overall volume and realize that we
too have choices of where to trade.



volame of relevant spread transactions, or bid/offer data where
transactions have not occurred, bas proven to yield reliable settlement
prices, whether the methodology is based on activity in the electronic
venue or activity in the open outcry venue, The changes to the
settlement methodology for CBOT agricultural futures will incorporate
activity from both venues into the settlement price calculations for each of
the futures contracts, thereby increasing the number and volume of
transactions, as well as the number of participants, informing the
settlement price determination.

. Prevention of Market Disruption: The Global Command Center,

the CME Group Settlement team and the Market Regulation Department

each have the capacity to identify abnormal price movements during the

settlement period and to take remedial actions as appropriate relative to

their respective functions. CBOT has settled certain agricultural

futures contracts based on open outery activity and others based on

electronic activity, and in either case the methodology has not
impeded the Exchange’s ability to effectively monitor trading and
mitigate the potential for market disruptions, Incorporating activity

from both venues into the settlement price determination will not diminish

the Exchange’s ability in this regard.” (Emphasis added),

See Exhibit D attached hereto.

84. The proposed change in the settlement methodology for Agricultural
futures contracts of the CBOT breaches the commitment to maintain open outcry markets
of the CBOT and will effectively discontinue such markets for each and all of the
following reasons:

85. ... In violation of Articles IV, Section D(2){b) of the CBOT Certificate, the
. proposed change in the settlement methodology for Agricultural futures contracts of the
CBOT hes never been submitted to, or approved by the Board of Directors of the CBOT.
Tn violation of. “Articles IV, Section E of the CBOT Certificate, the Board af Directors of
- ‘the CBOT never determined that the open. outery markets were no longer “liquid”. In

fact the proposed change vill _Tikely result in such markets becoming illiquid and

obsolete. Finally, in violation of Atticles Vy, Section E of the CBOT Certificate, the

23



wee

were te

A
a
}
f.

(c) “Court? means the Delaware Chancery Court presiding over the CBOE Litigation;
(© “Complaint” means the complaint on fife with the Court setting forth the claims in the CBOE
Litigation as of the time of the Final Resolution;

(© “Date of Determination” means the date of the Final Resolution giving rise to the necd to
determine Fair Market Value;

() “Fair Market Value” means, with respect to the components of any Per ERP Recovery, the
sum of (1) the amount of cash received plus (2) the value of any marketable scoutities received, which
shall be deemed to have a per security value equal to the average of the closing prices of such
marketable security for the ten trading days ending on the day immediately proceoding the Date of
Determination on the principal national securities exchange or inter- dealer quotation system on which
such marketable securities are listed or admitted to trading plus (3) the value of any other property or
rights received or estained, the value of such property or right being determined on the basis of an arm’s
length transaction between a willing buyer and a willing seller based on then prevailing market
conditions and taking into account all circumstances determined to b¢ relevant to the establishment of
such price af such time but disregarding any liquidity, minority, transferability or other discounts by an
independent investment batiking firm with a national reputation that is recognized to have expertise in
-yalyations of such other property or rights selected by the CROT Directors (or, if no CROT Directors
exist at such time, their successors) and approved by the full Board of Directors of the Corporation;

{g) “Fina! Resolution” means a final, non-appealable resolution of all clains of the Class
Members set forth in the Complaint that is binding on all Ciass Members, which may include, without
limitation (i) a judgment of the Court resolving the CBOE Litigation, (ii) a settlement resolving the, .
CBOE Litigation confirmed by an order of the Court and (iif) if the CBOB Litigation is dismissed other
than on its merits, a decision or ordar of, or settlement with, @ governmental authority or third party
arbitrator with respect to all claims of the Class Members set forth in the Complaint; provided, however,
in the case of clauses (j) and (ii) that such settlement, decision or order does not prevent the Exercise
Right Privileges purchased by the Corporation pursuant to this Section F of this Articte IV of this
Certificate of incorporation from being used by a member of the class to participate in 8 Final
Resofution; 7

(h) “Non-Recovery Class Member” means any person who provides evidence reasonably
satisfactory to the Corporation that such person meets the requirements of a Class Member; and

{i) “Zero Judgmenj” means a Final Resolution pursuant to which the Class Members do not
receive or retain, as applicable, any Per BRP Recovery.

6. The Board of Directors of the Corporation shall be authorized to adopt, change or waive any Rule as
it deems necessary or advisable to enable the Corporation to acquire or dispose of Exercise Right Privileges in
order ta satisfy its obligations under this Section F of this Article IV of this Certificate of Incorporation and to
realize the valuo of the Exercise Right Privileges acquired pursuant to paragraph 1 of this Section F of this
Article IV of this Certificate of Incorporation, Tho provistons of Section D(2}(e) of this Article IV of this
Certificate of Incorporation shall not apply to any adoption, change or waiver of a Rule pursuant to this
paragraph 6 of this Section F of this Article IV of this Certificate of Incorporation; provided, that nothing in
this patagraph 6 of this Section P of this Article IV of this Certificate of Incorporation shall be interpreted to
permit the Corporation to impose fees, costs or expenses on Class B Members in order to acquire the Exercise
Right Privileges.

ARTICLE V
MANAGEMENT OF AFFAIRS ©" “*

‘The following provisions are inserted for the management of thie business and the conduct of the affairs of the
Corporation, and for further definition, limitation aud regulation of the powers of the Corporation and of its directors
and members: te :

A, In accordance with Sections 141(a) and 141(j) of the DGCL, the business and affairs of the
Corporation shall be managed by or under the direction of the Board of Directors of the Corporation. In
addition to the powers and authority expressly conferred upon them by statute or by this Certificate of
Incorporation ot the Bylaws, the directors are hereby empowered to exercise ell powers «nd do ail acts and

i
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To CME Group,

AS an active customer of the CME Group, f am writing to volce my strong opposition to the proposed
rule change regarding settlement procedures in a variety of CME and CBOT products, . The current
method of pit and open outery settlement adaquately meets my needs. Furthermore, | appreciate the
liquidity and transparency currently offered with pit settlement,

Thank you far your conskleration.



A requiring Defendants to maintain the status quo by suspending all rules
and procedures requiring settlement prices to be determined by blending open outory
prices with electronic prices based upon volume; and

B. enjoining Defendants from altering the CBOT procedures or rules in any
manner that would change the way in which settlement is conducted, diminish or
eliminate open out cry trading in the pits, or that otherwise would cause substantial harm
to Plaintiffs' ability to continue to do business and trade on the open outery system.

(2) For such other and further relief as the Court deems just and appropriate.

_ coUNTT
BREACH OF CONTRACT

1-92. Plaintiffs repeat and reallege herein the allegations contained in
Paragraphs | through 92 as if fully restated herein,

93. By and through the CBOT Certificate, Defendants entered into an
agreement with its Class B shareholders and those holding the interests of Class B

sharebolders.

94, Plaintiffs have performed all obligations requited of them pursuant to the

CBOT Certificate.

95, The CBOT has breached its obligations under the CBOT Certificate by
adopting a rule which adversely affects the open outery market without subtiting such,
new Tule to, much less obtaining approval by both the Board of Directors of the CBOT
and “a majority of the voting power of the outstanding Series B-1 Membership and

Series B-2 Memberships, voting together as a class.,..”

26



To: CME Group

The CME group has to look at the purpose of settlement. Any proposed change that couki affect the
health and Integsity of the marketplace should be considered by all participants ahd not just a select
few. Ide not feel the CME group has a valid reason to change the price settlement policy, other than to
accommodate a small group of people at the expense of thousands of others! The CME group needs to
look at the good of the whole, nat just what is good for them. It seems one or two customers feel the
need to skew the market unfatsly, Finally, this exchange wes founded and built on falr and equitable
markets by thousands of hardworking and canscientlous people. We welcome an open discussion by a
panel of participants: brokers, traders, end users, hedgers and producers, to find an equitable solution
to this situation,

Sincerely,

Witte E Bim — WEB fore enti

J2- 27 //





Cattleo, LLC
CO 775 Ridge Lake Bivd, Suite 450, Memphis, 'TN 38120-9473
Telephone: 9017664466 Facsimile: 901.166.8157

January 17, 2012

Mr. Tom Clark

Manager and Associate Director
CME Group

20 South Wacker Drive
Chicago, Ilincis 60606

Via FEDEX
Via ernail: tholark@cme.com

Dear Tort:

About two weeks ago, I received a call from a gentiernan in your office asking ny

opinion on settiement procedures of cattle. 1 stipulsted that I had not seen any reat date,
but was open ta whatever method gave the truest price discovery. Since that time, Ihave
had time to reflect on the methods ‘and discuss with my long-stuading floor broker of 25

years,

My opinion today iy that even though the volume has tripled from the days where cpea
outory was only game dnd we held 10-15% of open interest in our sctive personal hedge
agcounts and sometimes 10-20% of the total daily volume primarily in the spread trade,
the: ability to easily mave large trades have become more cambersome, Simply said, the
cattle pit traders provide a convenience fo get large trades done or offisred that meet cur
daily goals, especially in thn detivery period. Lwould love to look clouer at your date for
making such a change and seo how the human element of the closing period works when
the algorithmic traders are in full control and the few seconds of « human mind with its
delay are matched to take advantage of a disparity in the final seconds,

We depend on a fair closing statement to settle our daily equity requirements with our
banks. Can you guarantee me that this method will sotually reduce volatility in that time
period? ‘We understand that costs are high and that ramming floor operations are
expensive, but that human element doss bring abuut a. reasonable test when issues got
“out of tine”. Outside of your shareholders or the nou-industry traders, who hax
complained of the costs to run these floar operations? Are we not really talking about
keeping the floor open?

As 4 cattls feeding operation with capacity of 110,000 head and yearly sales of $280
million in all of owr operations and very low single margin profits, we fully depend on the
ability to hedge and will nat bs in business without this mechaniam. We are not fully
vertically structured and do not directly have the consumer or final user to offset our risk.
Our only option to survive ia with your ability to bring us fair and true price discovery,
specialty ag it retates to the delivery period, Without it, or only option is to become &
custont feeder for the Jarge packers or most likely cease operations.

FerDLors: Caitico-Fort Morgan 13946 County Road 21, Fort Mergan, CO @070% = Tel: 970.867.4977 Fan: 970,867.4904

Cattleo-Liberal 14826 Red 4, Liberal, KS 67901 Te: 624.9722.
is 620,624,
Cattlea-Middieton 940 Lenoir Roxd, Midleton, TN 38052 Tels 7137898 hae TeLaTeseel



Attention CME Group,

The recent decision to chango the settlement process is one made without consideration
to all parties directly affected by this change. This exchange was founded with the principle of
“Free Markets for Free Men” a principle which has fallen by the wayside in lieu of the benefit of
2 select fow. At any given time trading floor operations employ a minimaum of 4,000
hardworking individuals, people like you and me, who will be forced to watch as this biased
decision destroys their very livelihoods. For the past 92 years, this exchange has relfed upon the
hard work and dedication of traders, brokers, end users, clerks, producers and hedgers. To
implement a change in the price settlement policy without the input of the aforementioned parties
is a decision made without regard to the Fair Dealing section of the CME Board Code of Ethics.
ask on behalf of all parties involved that you take the nevessary steps to arrange a meeting in
which both sides of this issue are given an opportunity to discuss and make # teasonable
solution.

a af
Ken Zekich



|

Gmail -g Page J of 1

mail Sc

ep egie
2 messages
Ok. ‘ Wed, fart 48, 2042 at 8:56 AM
Clay Mosiey
‘Owner Clay Masiay Cattle CoiPariner; Dixie Cattle Co.
1777 Dymake Dr

Collierville, TN 38017
>

Dear CME Group—As an active customer and cattle feeder, | am writing to voica my etrong apposition to the
proposed change in the rule regarding settlement procedures in the CME and CBOT agricultural contracts, As
electronic trading came to be, | was excited about the new platform end the opportumities they would provid,
| was equafly calmed by knowing we would have 2 venuss that were trans Nt, equitable and liquid,
Regrettably what we new have is 2 markets dilulad compared to one great liquid trade. Electronic markets
have forced participants to use other methods of trading and hedging, taking away jobs from the CME. )
appreciate the iquidity and transparency curently used with pit sotttements and feel any othtes means of
settlement could 52 subject to manipulation.

Sincerely,

Clay W Mosley

° oom ‘Wed, Jan 18, 2042 at 9:67 AM

{Quotad tet hidsany

Atipsv/manil. google. com/mail/tui~2dik-ObFER ach Sdcview=ptsearch=inboxéeth= 1341187, 18/2012



December 21, 2012

Jam 2 market maker on the grain floor of the Chicago Board of Trade, Isupport the current settlement Hf
method and do act want It to be aitered. | want settlement prices to be determined by open-outcry
trading in the pit on the ciose.

‘Thank you for your constderation in this matter. ‘

peed Guts ETS UGH EES MALLEL,

ween



December 21, 2014

1am a market maker on the grain Raor of the Chicage Board of Trade. | support the current settlement
method and do not want ft to: be altered. want settlement prices to be determined by open-outcry
trading In the plton the close,

Thank you for your consideration in this matter. \

q
a

rae ees oe tat DAR CeU. Caitil seQue ert plces ly Ue dcteere ite ep aye

Me ot <a IN

t



AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
BOARD OF TRADE OF THE
CITY OF CHICAGO, INC,
(ORIGINALLY INCORPORATED IN THE STATE OF DELAWARE UNDER THE NAME DELAWARE
CBOT, INC. ON MAY 12, 2600)

ARTICLE I
NAME

The name of the corporation is Board of Trade of the City of Chicago, Inc. (hereinafter referred to as the
“Corparation”),

ARTICLE IL
REGISTERED AGENT
‘Tha address of the registered office of the Corporation in the State of Delaware is 160 Greentree Drive, Suite

101, ia the City of Dover, County of Kent, Delaware 19904, The namo of the registered sgent of the Corporation at a,
such address is National Registered Agents, Inc,

ARTICLE IL
CORPORATE PURPOSES
The nature of the business or purposes to be conducted or promoted by the Corporation are to engage in any

lawfal act or activity for which corporations may be organized under the Delaware General Corporation Law (as
amended from time to time, the “DGCL”).

ARTICLE IV
MEMBERSHIP

A, General.

The Corporation shall have no authority to issue capital stock, The terms and conditions of membership in the
Corporation shall be as provided in or pursuant to this Certificate of Incorporation, the Bylaws of the Corporation
(the “Bylaws”) and the Rules and Regulations of the Corporation as in effect from tine to time (the “Rutes”),

B. Classes and Serles of Mambership.

Membership in the Corporation shall be divided into classes and series as set forth in this Asticte TV.

1. Class A Membership.

‘There shall be one Class A Membership in the Corporation (the “Class A Membership” and the holder thareof,
the “Cless A Member”), which Class A Membership shail be held by CME Group Inc., a Delaware corporation .
(“CME Group”). It shail be a term and condition of such Class A Membership that such membership may not be

‘transfested to or held by any person or entity ather than CME Group unless tnithorized by an zméndnient fo this” ©" "

Section B(1) of Article IV. Except to the extent (if any) expressly provided herein or required by Jaw, the Class'A
Member shall have the right to vote on any matter to be voted on by the members of the Corporation other than on.
those matters expressly reserved to the vote of the holders of Series B-1 Memberships and Series B-2 Memberships
(each as dedined in Section B(2) of this Article TV} and shall have the exclusive right to receive any dividend or
other distribution (including upon fiquidation, dissolution, yinding-up or otherwise) to be declared, paid or
distributed by the Corporation, and no other member of or class or series of membership in the Corporation shalf be
entitled ta vote on any matter except as set forth in Section D{2) or Section # of this Article IV or Article IX of this
Certificate of Incorporation, or to receive any such dividend or other distributlon.



“B. Commitment to Maintain Open Outcry Markets. Subject to the terms and
conditions of this Section E of Article IV, the Corporation shall majutain
open outcry markets operating as of April 22, 2005 (the “Effective Date”)
and provide financial support to each such market for technology,
marketing and research, which the Board of Directors of the Corporation
determines, in its sole and absolute discretion, is (including, for calculation
purposes, volume from Exchange-For-Physicals transactions in such open
outcry market).

cord

. Notwithstanding the foregoing or any other provisions of this Certificate of
Incorporation, the Board of Directors of the Corporation may discontinue any
open outcry market at such time and in such manner as it may determine if; (1}
the Board of Directors determines, in its sole and absofute discretion, that a
market is no longer “liquid” or (2) the holders of a majority of the voting power
of the then outstanding Series B-1 Memberships and Series B-2 Memberships,
voting together as a single class based upon their respective voting rights,
approve the discontinuance of such open outcry market.” (Emphasis added).

36, Plaintiffs relied upon the CBOT Certificate and the representations of the

‘BOT and the CME of their commitment to maintain the open outcry markets in

retaining Plaintiff's Class B shares and in continuing the business of the CBOT.

37. The CME and its subsidiaries, including the CBOT, are one of Illinois’
largest eriployers and corporate taxpayers.

38. After the Ulinois state legislature (the “Legislature’) enacted a cocporate
income tex increase in 2011, the-CM2 threatened to leave the state, taking the CBOT
with it— and causing a loss of thousands of Illinois jobs and corporate income — unless it
was provided relief from the increase. The CME informed Illinois Legislature that 2 tax
break would prevent a significant loss of jobs in the state.

39. Late in 2011, the Legislature responded to CME’s threats, and passed a

bill that was signed into law by Governor Quinn on December 16, 2011, providing the

10



}

Icarus Investments Mail - Fwd: CME Hybrid Settlement Pricing Page 1 of ]

Gwin
G M ai | Jennifer Mayer <jmayer@icarisirading.com>

ayant

Fwd: CME Hybrid Settlement Pricing

1 message

From the Dask of Heather K <hk@icarustrading.com> ‘Thu, Dec 22, 2041 at 10:59 AM
Reply-To: hk@icarusirading.com
To: Jennifat Mayer <[mayer@icarustrading.com>

Forwarded message
From: True, Harry {FLNA} <Harry True@nengica. com>
Date: Tue, Dec 20, 2011 at 13:37

Subject CME Hybrid Settlement Pricing

To: “hi@icarustrading. com" <hk¢aiearustrading.com>

Oear Sir;

Lam welting to advise that we do not support the movement to a determination of settlement prices by any form of

“hybrid devives* based on a combination of open outery and electronic markets. We believe strongly that the closing
valves and settlement procedures tong used by open autcry methodology offers the truest form of market close price
discovery, -

We certainly acknowledge the value of the electronic platforms in use for extended hour sessions and believe that the
methodologies in place since their advent are more than adequate for continuation “as is”. We believe that itis
important that the impact of people over machines be sustained by the CME Institution as a viable "check" as well as
"compliment" to the movernent towards the electrontt era. In many situations, the use of people, during the open
outcry sessions, have led to more effective transaction clarity than has been our expertence with electronic activities.
Itis beesuse of this that we strongly favor the continuation of a separate but equal standing between open outcry and
electroni¢ closes and market actlyity.

Harry W, True

Sr. Director
Commodity Operations
Fritotay, ine.

https/mail google. com/mail/?ui=2&ik-64108d4537&view=pt&-search=inbox&th=1346... 12/22/2011



maintaining the CBOT open outery markets operating as of April 22, 2005 and would
take no action that adversely affected the commitment to maintain the open outery market
unless such change was apptoved by the CBOT Board of Directors.

34, Under the Amended and Restated Certificate of Incorporation of the
CBOT (the “CBOT Certificate”), a copy of which is attached here to as Exhibit A and
incorporated herein; which was issued prior to the effective date of the merger between
the CBOT and the CME, the CBOT expressly committed to maintain open outery
markets, Article IV, Section D(2)(b) of the CBOT Certificate expressly provides:

“(b) In addition to any approval of the Board of Directors of the
Corporation required by this Certificate of Incorporation, the Bylaws or
applicable law, the affirmative vote of the holders of a majority of the votes cast,
except in the case of paragraph (4) below, by the holders of Series B-1
Memberships and Series B-2 Memberships, voting together as a class based on
their respective voting rights at any annual or special meeting of the
Corporation, shall be required to adopt any amendment to this Certificate of

Incorporation or the Bylaws or the Rules that, in the sole and absofute
determination of the Board of Directors of the Corporation, adversely affects:

Bidud

_ (4 the commitment to maintain open ontery markets set forth in
Section E of Article IV of this Certificate of Incorporation, which must be
approved by a majority of the voting power of the outstanding Series B-1
‘Membership and Series B-2 Memberships, yoting together as a
elass...."(Emphasis added), (The certificate of Incorporation is attached hereto
as Exhibit A) .
‘The new rule announced by the CME to effectuate a blended settlement procedure for the
CBOT Agricultural Futures markets has never been submitted to, much less approved by
a majority of the voting power of the outstanding Series B-1 Membership and Series B-2
Memberships, voting together as a class.
35. In addition, in Article IV, Section E of the CBOT Certificate, the CBOT

agreed to a commitment to maintain the open outcry markets:



[Fora of Assigament Agreement for the sale of Exercise Right Privilege]

‘The undersigned (the “Sel/ing ERP Holder”) is the holder of record on the official books and records of the
Board of Trade of the City of Chicago (“CBOT") as of May 29, 2007 of (I) a Series B-1 Membership (as defined in
the Amended and Restated Certificate of Incorporation of CBOT (the “Certificate of Incorporation’) in respect of
which an Exercise Right Privilege (as defined in Rule 210(b) of the Rules and Regulations of CBOT) (referred to
hereinatter 28 an “ERP") is issuable but has not been issued or (I) both (2) an ERP and (b) a Series B-1 Membership

and Proposes to sell such ERP to CBOT for an amount equal to $250,000 i in cash Pursuant to Section F of. Article v .

of the Certificate of Incorporation,

The Selling BRP Holder understands thet CBOT only has a commitment to purchase an ERP for which
delivery of the ERP together with this Assignment Agreenient, duly exccuted by the Selling ERP Holder, is made to
CBOT during the forty-five (45) day pcriad immediately following the effective time of the merger of CBOT
‘Holdings, Inc. (“CBOT Holdings”) with and into Chicago Mercantile Exchange Holdings Inc. (“CME Holdings”)
porsuant to the terms of that certain Agreement and Plan of Merger, dated as of October 17, 2006, as amended,
among the CBOT, CBOT Holdings and CME Holdings.

1, The Selling ERP Holder represents and warrants to CBOT that:

a. The Selling ERP Holder has valid title to the BRP, free and clear of aM security interests,
claims, liens, equities or other encumbrances (“Liens”), and has the legal right and power, and all
authorization and approval required by Jaw or the certificate of incorporation or by-laws (or equivalent
organizational documents) of the Selling ERP Holder (if the Selling BRP Holder is not a natural
person), to enter into this Assignment Agrcement and to sell, transfer and deliver the ERP to be sold by
such Selling ERP Holder. When the BRP is delivercd to and paid for by CBOT in accordance with the
terms of this Assignment Agreement and the Certificate of Incorporation, CBOT will have valid title to
the ERP, free and clear of ail Liens,

b. The execution and delivery by the Selling ERP Holder of, and the performance by the Selling

ERP Holding of its obligattons under, this Assignment Agrcement will not contravene any provisions of
applicable law, or the certificate of incorporation or by-laws (or equivalent organizational documents) of
the Selling ERP Holder (if ths Seiling ERP Holder is not a natural person), or any agreemcat or other
instrument binding upon the Selling ERP Holder or any judgment, order or deores of any governmental
body, agency or court having jurisdiction over the Selling ERP Holder, and no consent, approval
authorization or order of, or qualification with, any governmental body or agency is required for the

_ perfoumance by the Selling ERP Holder of its obligations under this Assignment Agreement. -

¢. The Selling ERP Holder did not acquire the ERP in a transfor directly or indirectly from the
Chicago Board Options Exchange, Inc.

2. CBOT shall make payment to the Selling ERP Holder in accordance with Section F of Article IV of
the Certifloate of Incorporation to the account set forth on the signature page hereto,

3. This Assignment Agreement shall be governed by the internal laws of the State of Delaware, without

regard to conflict of law principles.
In wines: sees the undersigned has duly executed this Assignment Agreement this oy of
+ 2007. :
Signature of Selling ERP Holder
Selling ERP Holder:
Name:
Address:

Phone:



December 24, 2041 .

lam a market maker on the grain fldor of the Chicago Board of Trade. | support the current setttement
method and do not want It to be altered. } want settlement prices to be determined by open-outcry
trading in the pit on the close.

Thank you for your consideration in this matter.

Lh Vo Pa

seebe tne cea geoan POUr ub tne Chhicagy Bodie uf bade. 1 suppure Gee Gurr poli ae

weg FE v ¢ i

[
|



products to close upon a volume-weighted average price coustitutes an amendment to the
Rules. This amendment to the Rules adversely affects the commitment to maintain open
outcry markets, as has been previously determined by the CBOT Directors Committee of
the CME, and has never been approved by a “majority of the voting power of the
outstanding Series B-1 Membership and Series B-2 Memberships, voting together as a
class...”

82. In addition, the CBOT defines “Rules” as:

"The Certificate of Incorporation, By-Laws, tules, interpretations, orders,

resolutions, advisories, notices, manuals and similar directives of the

Exchange, and all amendments thereto.”
Thus, the May 25, 2102 Special Executive Report constitutes a “Rule.” Under Article IV,
Section D(2)(b) of the CBOT Certificate, this new Rule must be approved by a “majority
of the voting power of the outstanding Series B-1 Membership and Series B-2
Memberships, yoting together as a class...” since the CBOT Directors Committee of the
CME has already determined that it adversely affects the commitment to maintain open
outcry markets and materially impairs the business opportunities of the Class B
memberships, such as those of Plaintiffs.”

83, The CME itself has acknowledged that the proposed change in settlement

. methodology is not necessary to prevent market manipulation or market disruption,

stating that:

. “Contracts Not Readily Subject to Manipulation: CME Group
employs a variety of settlement methodologies across its product

portfolio and has not observed that the execution yenue from which
the settlement price is derived impacts whether a contract is readily
susceptible to manipulation, In CBOT agricultural futares, the
current methodology of settling the designated lead month contract
based upon the prices and volume of outright transactions and of
settling the remaining contract months based upon the prices and

22



of his income is derived from trading the closing range with settlement determined by
open outcry orders. If the new settlement rule is adopted, McKenna will lose the vast
majority his livelihood and therefore his business as a trader will be ended.

64. Plaintiff Todd Theiiman is a Class B shareholder of the CBOT and
currently acts as a broker daily in the Corn, Wheat, and Soybean pits at the CBOT.
Thielman has made his livelihood filling orders in the open outcry arena at the CBOT for
years, A large percentage of his income is derived from filling orders in the closing
Tange with settlement determined by open outcry orders, If the new settlement rule is
adopted, Thielman will lose the vast majority his livelisood and therefore his business as
a broker will be ended.

65. Plaintiff William Montgomery has traded in the Com pit of the CBOT for
approximately 6 years. A large percentage of Montgomery’s income is derived from
trading the closing range with settlement determined by open outcry orders. If the new
settlement rule is adopted, Montgomery will Jose the vast majority his livelihood and
therefore his business as a trader will be ended.

66. Plaintiff Stephen Melton has traded in the Com pit and at the CBOT for
approximately ons year. A large percentage of Melton’s income is derived from trading
the closing range with settlement determined by open outcry orders. If the new
- Settlement tule is adopted, Melton will lose the vast majority his livelihood and therefore
his business as a trader will be ended.

67. Plaintiff William Armonda has traded in the Corn pit and at the CBOT for
approximately 24 years. A large percentage of Armando’s income is derived from trading

the closing range with settlement determined by open outcry orders, If the new

17



17. Plaintiffs trade and or fill orders, and have traded and or filled orders for
yeats, in the Agricultural futures pits on the CBOT or own businesses that employ other
Traders or Brokers in the pits along with numerous staff such as clerks, runners,
information technology professionals and others. The Traders’ and Brokers’ livelihood
and primary employment is derived from trading and filling orders for derivatives in the
CBOT’s open outery market,

18. Both the Agricultural futures of the CBOT and the Livestock futures of the
CME are and have historically been traded in similar mamer, both in an open outcry
system and, only within approximately the past 6 years, side by side, both through open
outery and electronically.

19. In the open outcry market system, traders compete for buy/sell orders from
brokers whose customers have the orders executed in the pits as well other Trader’s own
market orders by competitive bidding and offering at prevailing prices, Thereby, final
settlement prices ate derived through transferring information about the ordérs and
arriving at final settlement prices through direct communications with each other -
including orally and through hand signals — during a designated closing range time
ee

20. The open outery system for both the CBOT and the CME have historically
determined all settlement prices at the end of the trading day. One of the system’s chief
benefits is that it can handle large volumes of orders and distribute them in an effective
manner. In addition, floor traders provide benefits as counter-parties, adding additional
liquidity to the trading contracts, allowing the price to be discovered and the risk shifted

by genuine supply and demand.



December 21, 2022

(am a micket misker on the grain flaor af the Chicago Board af Trade. {suppoft the current settlement
method and do not want it ta be altered, | want settlement prices to be determined dy open-outcry
trading i the pit on the dose.

bly Lod ig

aes on per on (he erain floor of the Chicago Board of Trade. t support the current setuciie::

,e Zs Lib 4



Ronald C. Zais
2143 west Warner
Chicago, 60618

773-682-0687

Subject: Blended Setttement prices

To whom it may concen

My name és Ronald C. Zais and I have been a member of the Chicago Board of Trade since 1975

Previously I worked for a large commercial fm in many different capacities from runner, back office,
¢ phone clerk, outtrade checker, house broker, to floor manager for a total of 26 years,

For the iast 15 years I have been a broker/trader in the soybean meal pit.

1 was on the Arbitration committee for several years and am now co-vice chairman of the soybean
Meal p& committee.

As you can see have done and seen most of what has happened and have an idea of what will
happen
with the new proposal.

Your idea of a blended close between the computer and the floor trate ta estabfish a settlement iY
price
is in my opinion @ poor decision for the fallowing reasons.

Beans now close between 1:14-3:15 with the computer. Soybean oil closes on a call from’top option
to back options from 1:25 till approx 1:17. Mesf from back months to top option in roughly same time:
frame.

This system allows several groups of local crushers to see approx where beans will setife go to the oil pit
and keep the crushes somewhat in fine (oil not to high or to low from where the beans clased) and then
fur to meal and keep that from closing to high or to low depending on where beans were,

‘The Mid gives them an opportunity to get close to even by the end of the day.

If understand it correctly. mostautospreadersand crush programs.shut.off at 1:14 taking anys
spreading :
opportunities between markets completely away allowing Oil and Meal to cose with no relationship to i
soybeans on the computer, This is terribly unfair to all concerned, from oil/meal Spreaders to oil/bean
spreaders to meal/bean spreaders and especially crushers both local and Commercial. It is physically
immpossible for local crushers to get to all three pits in I minute and do what they do with remarkable
efficiency to keep the computers in line with regards to the spd markets between the three pits,

SeThs to tern otion in reurihty saa tee

es, aspx?opids=7521a961-31b8-1 le, 12/29/2011

saghee WEE tte a wee ey
E14 til apy

http://by jw.bay anail.live.com/ma

cer TUDE MUNG SPredUeEs Wad Crust) PUG AI Mh WEE We nd tiene nee



96. In addition because the new rule announced by the CME to effectuate a
biended settlement procedure for the CBOT Agricultural Futures markets will effectively
eliminate the open outcry markets, the CBOT breached the certificate because the CBOT
Board of Directors never determined that the open outcry markets were no longer liquid
nor did a majority of Class B shareholders yotes in favor of a change,

97. Plaintiffs have suffered damages as a result of Defendants’ breaches,

WHEREFORE, Plaintiffs request the following relief:

A. Damages in excess of $50,000 an amount to be proven at trial; and

B, For such other and further relief as the Court deems just and appropriate.

COUNT TI
BREACH OF FIDUCIARY DUTY

1-97. Plaintiffs repeat and reallege herein the allegations contained in
Paragraphs | through 97 as if fully restated herein.

98. Defendants owe fiduciary duties to the CBOT’s shareholders like
Plaintiffs, including the duties of care and loyalty.

99, Defendants breached their fiduciary duties to Plaintiffs by unilaterally
detennining to change the cBor procedures for reaching settlement prices to a blended
settlement methodology for Agricultural Futures contracts of the CBOT without approval
“by a majority of the voting power of the outstanding Series B-1 Membership and
Series B-2 Memberships, voting together asa class.”

100. Defendants breached their fiduciary duties by implementing a system that

adversely affects and harms Plaintiffs’ interests as Class B shareholders and that violates

27



living trading in the open outcry market, and Fasano was forced to cease all business in
the Wheat pit.

48. Plaintiff Touy McKerr is a Class B shareholder of the CBOT, a
shareholder of the CMB and currently trades daily in the Cor pit at the CBOT, McKerr
has made his livelihood trading in the open outery arena at the CBOT for the past 28
years. Approximately eighty percent of McKerr’s income is derived from trading the
closing range with settlement determined by open outcry orders. If the new settlement
tule is adopted, McKerr will lose the vast majority his livelihood and therefore his
business as a trader will be ended.

49, Plaintiff Heather Koch is and has been a Class B shareholder of the CBOT
for 15 years. Koch trades daily in the Soybean, Soybean Oil and Soybean Meal pits
Koch is a member of a proprietary trading firm, A large percentage of Koch’s income for
her firm is derived from trading the closing range with settlement determined by open
outery orders and from trading with Brokers or Traders who are in the pits daily: If the
new settlement mule is adopted, Koch will lose the vast majority her livelihood and
therefore her business as a trader will be ended,

50, Plaintisf Mary McKerr is a Class B shareholder of the CBOT, a
shareholder of the CME and currently trades daily in the Com pit at the CBOT. McKerr
has made her livelihood trading in the open outcry arena at the CBOT for the past 29
years. Approximately eighty percent of McKerr’s income is derived from trading the
closing range with settlement determined by open outcry orders. If the new settlement
rule is adopted, McKerr vill Jose the vast majority her livelihood and therefore her

~- business as a trader will be ended.

13



SUPREME COURT RULE 222 AFFIDAVIT
‘The undersigned, being sworn on oath, deposes and states that the total damages

sought in this matter exceed $50,000.

gubhn (4.
y /

SUBSCRIBED and SWORN to before me rence SEAL

5 SE
on this 2 “day of June, 2012. Notary Pus = Se Soi
Neon My Commission Expires Ape 8, 2016
Notary Public —

24



December 21,2011"

{am a market maker on the grain floor of the Chicago Board of Trade. | support the current settlement
method and do not want it to be ered I want settlement prices to be determined by oper-outcry
trading In the pit on the close; . - ae, Sarees

Thank you for your consideration In this matter.

ip. .

eerreee erat

te PO



December 21,2041

lam a market maker on tha grain floor of the Chicage Board of Trade. [ support the current settiement
method and do not want it to be altered, | want settlement prices to be determined by open-avtcry
trading In the pit cn the clase,

Thank you for your cansideration in this matter.

i
t
|
i
t
i
|



51, Plaintiff Bard Hoffman currently trades in the Soyben pit of the CBOT
and has traded at the CBOT for approximately 20 years. A large percentage of Hoffman’s
income is derived from trading the closing range with settlement determined by open
outcry ordets. If the new settlement rule is adopted, Hoffman will lose the vast majority
his livelihood and therefore his business as a trader will be ended.

32. Plaintiff Ralph Dynek trades in the Corn pit of the CBOT and has traded at
the CBOT for approximately 20 years. A large percentage of Dynek’s income is derived
from trading the closing range with settlement determined by open outcry orders. If the
new settlement tule is adopted, Dynek will lose the vast majority his livelihood and
therefore his business as 4 trader will be ended.

53. Plaintiff Craig §. Felde has been a broker in the Com pit of the CBOT for
approximately 20 years, A large percentage of Felde’s income is derived from filling
orders in the closing range with settlement determined by open outery orders, If the new
settlement rule is adopted, Feide will lose the vast majority his livelibood and therefore
his business as a broker will be ended.

_ 54. Plaintiff Rory O’Donneli has traded in the Corn pit of the CBOT for
approximately 6 years. A large percentage of Q’Donnell’s income is derived from trading
the closing range with settlement determined by open outcry orders. If the new
settlement rule is adopted, O’Donnell will lose the vast majority his livelihood and
therefore his business as a trader will be ended.

55, Plaintiff Kevin Duffy is a Class B shareholder of the CBOT and currently
acts as a broker daily in the Com pit at the CBOT. Dutty has made his livelihood filling

orders in the open outcry arena at the CBOT for the past 23 years. A large percentage of

14



December 21, 2012

lama market maker on the grain floor of the Chicago Board of Trade. | support the current settlement
mathod and do not want it to be altered. i want settlement prices ta be determined by Opar-outcry
trading in the plt on the close.

Thank you for your consideration in this matter.

BRE

i
i
i



December 21, 2011 ° , :

{ama market maker on the grain floor of the Chicago Board of Trade, support the current settlement
methad and do not want it to be altered, | want settlement tprices to he determined by open-outcry
trading in the pit on the close.

Thank you for your consideration in this matter,



Alan Palmer

Jamuary 06, 2012

Dear CMB GROUP,
Keep listening to Goldman Sachs and CME will be out of business,
Sincerely,
Alan Palmer

palmeralanl @comcast.net



NAME: RONALD ZAIS..._ |
STREET; 2143 WEST WARNER
TOWN: CHICAGO
STATE: ILLINOIS

To CME Group Board of Directors and Management Staff, .

Tam writing to

g ¢ the plan to have Settlements include electronic.
trading platform rather re ue ,

ely by Open outcry.”

The price of my crop is directly based on settlements. I believe the
new process will severely and negatively impact the integrity of the
agricultural futures markets. I am deeply concerned about the degradation of
the hedging mechanism due to the electronic market. The potential for price
manipulation occurs when an electronic trader places a massive unregulated
order and slams the electtonicamarket in the last mille-seconds of the trading
day. This allows HFT (high frequency traders) and algorithmic traders to
manipulate prices to benefit their books.

T don’t believe that the CFTC and CME Group have addressed the
interests of the farmer in mandating this change.

. 1 do, not wantiangnelectronic aparketdnfluence on the settlement
procedure,

Sincerely,

ts ae ote

Please type your name to sign:

etre GC CLEOHTES UREL un Lite Land alaticroeeuinas er Uae teeters,

RONALD ZAIS ot ow,
Bye Lb ks gee Leg eee slot

ere Ay CEC GEN CEE SEGUE Ga cae Ere

eda FAIS



Date 04/11/2012
Dear CME GROUP,

As an active customer an
proposed change in the rule
agricultural contracts.

am writing to voice my strong opposition to the
lement procedures in thé CME and CBOT

When electronic trading was introduced, I was excited about the new platform to access
agricultural markets. The marketplace was led to believe there would be 2 venues that
were transparent, equitable and liquid. What you have now is two-tiered markets that
are not held to the same rules & ethics.

Electronic markets are not on an even playing field and these destructive practices have
driven the needed participants to use other methods of trading and hedging risk. The
poor decisions being made wil} affect the market volume and ultimately the jobs that
support the industry.

L appreciate the liquidity and transparency currently used with pit settlements; and feel
the use of electronic trade is easily manipulated and not transparent. By passing the
settlement decision to an electronic close or volume base hybrid, you will give more
power to the electronic aden THIS has and will cqntione to manignulate the integrity of the
grain and livestock contracts : : .

Sincerely,

Mary Richard

2M Dyk padizy



72. Plaintiffs and numerous others have objected to the rule change for these
reasons. See Exhibit C attached hereto,

73. Defendants did not consult with the Plaintiffs or, upon information and
belief any other Class B open outcry traders or their clients prior te issuing the Special
Executive Report designed to change the settlement rule.

74. ‘Defendants were aware of the potential adverse effects that making a
change to the settlement rule would have upon the Plaintiffs and other traders in the open
outery markets,

75. Both the Class B Members of the CBOT and the Class B Members of the
CME, who traded in the open outcry pits and their customers, objected to the proposed
change in settlement procedures set forth in the Special Executive Report.

76, The CBOT Directors Committee of the CME rejected the proposal for a
blended settlement procedure set forth in the Special Executive Report, finding that “the
proposed change in settlement procedures would materially impair the business of the
{CBOT] or materially impair the business opportunities of the Class B memberships”,
such as those of Plaintiffs. See Exhibit D attached hereto,

77,. The Rule Change Committee of the CME also rejected the proposed
change in settlement procedures recognizing that such change would materially impair
Membership interests of Class B members of the CBOT, who traded Agriculture futures
in the open outery pits and Class B members of the CME, who traded Livestock futures
in the open outcry pits.

78. Due to the objections of the Class B Members of the CME and their

customers that the proposed change would materially impair Class B shares and

19



December 21, 2012

Jam @ market maker on the grain floor of the Chicago Board of Trade. | support the current settement
method and do nat want it to be altered. f want settlement prices to bs determined by open-outcry
trading in the pit on the close.

Thank yau for your consideratian in this matter.

ba

Steven LoudoustS
SVE



proposed change in the settlement methodology for Agricultural futures contracts to be
submitted to and approved by the Class B Membership of the CBOT.

86. Defendants’ decision was made in disregard to the commitment to
maintain an open outcry market to make the change to an electronic system failed to
account for the substantial countervailing interests and reasons for sustaining the open
outery system.

87. Defendants are aware that the decision to move to an electronic settlement
system will sound the death knell for the vast majority of trading in the pits and will
result in overwhelming losses of jobs and income to the Plaintiffs as well as to other pit
traders and businesses on the CBOT — a circumstance that the CME claimed it sought to
avoid by seeking a reduction in its tax burden from the Illinois legislature,

COUNTY
INJUNCTIVE RELIEF

1-87. Plaintiffs repeat and reallege herein the allegations contained in
Paragraphs 1 through 87 as if fully restated herein,

88. By and through the CBOT Certificate, Defendants entered into an

. agreement with Class B shareholders of the CBOT.

89. . The CBOT Certificate provide the Plaintiffs certain rights, protections and
interests, including the commitment to maintain open outcry markets, and further
provides that any amendment to any rule which adversely affects the open outcry markets
must be approved by both the Board of Directors of the CBOT and “a majority of the
vating power of the outstanding: Series B-1 Membership and Series B-2

Memberships, voting together as a class....” The new rule announced by the CME to

24



Gmail - pit settlements Page 1 of

Gra a i | Alan Young <ajyajy1@qmalt.com

wGorr

pit settlements

1 message

Jim Yadgir <jyadgirt518@yehoo.com> Wed, Dec 28, 2011 at 8:16 PM
To: ajyaiy1 @gmail.com

YO THE CME EXCHANGE GROUP..

| AM CONCERNED ABOUT PIT SETTLEMENTS BEING REMOVED FROM THE PHYSICAL PIT... AND
BEING PLACED IN THE HANDS OF ALOGORITHMS,

THE PITS HAVE WORKED EFFICENTLY FOR DECADES IN JHE THIS MANNER.. OPEN OUTCRY...
{ FEEL THIS WOULD GREATLY HURT THE INDUSTRY AND CUSTOMERS AS WELL IF THIS IS
CHANGED,

SINCERLY,
JAMES YADGIR.
GENERAL PARTNER
FORECAST VENTURE FUND

Lgoogle.com/ruail/a/0/?ui=2&ik=0aa 707008 &-view=pt&searchTMinbax&ti= 13... 2/2/2011



December 21, 2011

lam a market maker'on the grain fidor af the Chicago Udard of Trade. support the currant settlement
method and do not want It to be altered. { want settiement prices to be determined by operroutcry
trading in the pit or the dose.

Thank yau for your consideration in this matter.

| Ohegtis Dra LL a
| C7

re CUP ent aclticies,

HAC aiwaer Ul tite grain oor of the Chicaga Board of Trade, Moy

fe ada vinatane

eo. Ea

ed



}

4
i
4

the rights and privileges of, and shall be subject to the restrictions, conditions and limitations on, an Associate
Membcr as sct forth in this Certificate of Incarporation, the Bylaws and the Rules,
(©) Series B-3 Memberships.

(1) Bach holder of a Series B-3 Membership who satisfies the qualifications for and requirements
of being a holder of a one-half Associate Membership as sot forth in clause (2) of Rule 296.00 of the
Rules shalf be entitled to the rights and privilcgos of, and subject to the restrictions, conditions and
limitations on, a holder of a one-half Associate Membership as set forth in this Certificate of
Incoxporation, the Bylaws and the Rules.

(2) Each holder of a Series B-3 Membership who satisfies the qualifications for and requirements
of being a holder of a GIM Membership Interest in the Corporation as set forth in clause (1) of Rule
296.00 of the Rules shall be entilled to the rights and privileges of, and shall be subjoct to the
restrictions, conditions and limitations on, a bolder of a GIM Membership {aterest as set forth in this
Certifloate of Incorporation, the Bylaws and the Rules,

(a) Series B-4 Memberships. Each bolder of a Series B-4 Membcrship who satisfits dsc qualifications
for and requirements of being a holder of an IDEM Membership Interest in the Corporation as set forth in the
Rules shall be entitled to the rights and privileges of, and shall be subject ta the restrictions, conditions and
Himitations on, a holder of an IDEM Membership Interest as set forth in this Certificate of Incorporation, the
Bylaws and the Rules.

(e) Sertes B-5 Memberships, Bach holder of a Seties B-5 Membership who satisfies the qualifications
for and requirements of being a holder of a COM Membership Interest in the Corporation as set forth in the, .
Rules shall be entitled to the rights and privileges of, and shall be subject ta the restrictions, conditions and *
limitations on, a holder of a COM Membership Interest as set forth in this Certificate of Incorporation, the
Bylaws and the Rules,

{f) In addition to the rights and privileges set forth above, except as otherwise provided in the Cerlificate
of Incorporation, the Bylaws or the Rujes, each holder of a Class B Membership of any Series shall be entitled
to all trading rights and priviicgcs with respect to those products that such holder is entitled to trade on the
‘open outcry exchange system of the Corporation or any electronic trading system maintained by the
Corporation ér any of its successors or successors-in-interest.

2. Series B-] Membership and B-2 Membership Voting Rights; Certain Covenants.

(a) { addition to any approval of the Board of Directors of the Corporation required by this Certificate
of Incorporation, the Bylaws or applicable law, the affirmative vote of the holders of a majazity of the votes
cast by the holders of Series B-1 Memberships and Series 5-2 Memberships, voting together as a class hased
on their respective voting rights at any annual or special meeting of the Corporation, shalt be requited to adopt
(gubject to the immediately following sentence, by merger or otherwise) any amendinent of, or any
modification or repeal of any provisions contamed in, Section B(2), Sectian C, Section D, Section E or
Section F of Article TV or the second sentence of Article IX of this Certificate of Incorporation or, during the
‘Transition Period (as defined in the bylaws of CME Group} Aiticle VI. Notwithstanding the foregoing, the
holders of Series B-1 Memberships and Series B-2 Memberships shall not be entitled to a yote on any merger,
consolidation or reorganization of the Corporation that resulta, by operation of law or otherwise, in an
amendment, modification or repeal of this Certificate of Incorporation so long as the rights and privileges of
the holders of Series B-1 Memberships and Scries B-2 Metaberships set forth in Section B(2), Section C,

. Section D, Scction B and Section F of Article [¥ and the second sentence of Article IX and, during the

Transition Period, Article Vi of this Certificate of Incorporation are preserved in the Certificate of
Incorporation or ather governing document of the surviving corporation of such transaction.

(b) In addition to any approval of the Board of Directors of the Corporation required by this Certificate
of Incorporation, the Bylaws or applicable law, the affirmative vote of the holders of a majority of the votes
cast, except in the case of paragraph (4) below, by the holders af Series B-1 Meraberships and Series B-2
Memberships, vating together as 2 class based on their respective voting rights at any annual or special
meeting of the Corporation, shall be required to adopt any amendment to this Certificate of Incorporation or
the Bylaws or the Rules that, in the sole and absolute determination of the Board of Directors of the
Corporation, adversely affects;

i
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‘



adversely affect the open outcry markets, in or about March 2012, the CME notified the
Class B Members of the CME that the CME would not be implementing the proposed
change in settlement procedures for Livestock futures contracts, Despite the fact that the
same adverse effects would be suffered by the Class B Members of the CBOT and their
customers, the CME refused to stop implementation of the proposed change for the
CBOT Agricultural futures contracts. On March 5, 2012, the CME issued a second
Special Executive Report, stating:
“Given consideration of significant market feedback following the release of S- .
6048, the dialogue with the CFTC and the néed for adequate market place
notification regarding the operational details of any prospective changes to the
settlement methodologies, no changes to settlement procedures will be
implemented in March or April.
Beginning in June 2012, the CBOT agricultural futures will transition to a
blended settlement methodology using volume-weighted prices from both Floor-
based activity and Globex-based activity. Further information on the specific
methodology to be employed and the specific implementation dates will be
communicated via Special Executive Report when final details are available,
Additionally, decisions regarding settlement procedures in CME Livestock
futures contracts have yet to be finalized pending on going dialogue with the
..CFTC. Further information will be communicated with respect to CME
Livestock futures when it become available.”
See Exhibit E attached hereto.
79, Pursuant to the Seventh Amended and Restated Bylaws of the CME, the
CBOT Directors Committee and the Rule Change Committee of the CME expired on
May 23, 2012.
80, On May 24, 2012, because: they could not obtain the approval of a
majority of the CBOT Board, purportedly pursuant to Rule 230(j) of the CME Rules,

Defendants Duffy as the Executive Chairman and President of the CME, and Phupidner,

20



Jim Ratcliff
broker .
775 Ridgetake Blvd,

Metnphis, or. 38120
L72 7
Deae CME GROUP, Tae

As an active broker, ] am writing to voice my strong opposition to the proposed change in -
the rule regarding settlement procedures in the CME and CBOT agricultural contracts.

"When electronic trading was introduced, I way excited about the new platform to enhance
agricultural asarkets, The marketylace was led to believe there jyould be 2 vernics that
were transparent, equitable and liquid. What you have now is;2 dituted markets that are
not held to the samc niles. Electronic markets are not on an even playing field and these
destructive practices have driven needed participants to use other methods of trading and
hedging. The poor decisions being made will affect the marketplace and ultimately the
jobs that support the industry,

l appreciate the liquidity and transparency currently used with pit settlements; acd feel
the use of electronic trade is easily manipulated. By passing this role, you will give more
Power to the electronic trad that manipulated and compronnised the intepsity of tke gesin
and fivestock contracts,



H
£
i

December 22, 2011°

lara market maker on the graln floor of the Chicago Board of Trade. | support the current settlement
methed snd do not want it to be atered, Uwant uettiomenit peices tw >be determined aby open-outery
trading In the pit on the close, 37 t wet. Lae

Thank you for your consideration in this matter,



December 21,2011, ..

bam a market maker on the grain floor of the Chicago Board of Trade. i support the current settlement
method and do not want It to be altered. | want settlement prices to be determined by apen-outcry
trading in the pit on the

Thank you for your consideration in this matter.



21. The open outery system is fast-paced and becoming a successful Trader or
Broker requires years of experience. Because of the specialized nature of the system, the
Traders’ and Brokers’ skills are not easily transferrable to other positions.

22. Yn contrast to the open outcry system, an electronic system places buy and
sell orders and sets settlement prices electronically, away from the pits, reducing and
eliminating the need for floor traders and their staffs.

23. In addition, because an electronic system calculates settlement prices
immediately without reference to the activity on the floor, “flash crashes” and other
issues can occur under that system, which can have a detrimental effect on the overail
economy.

24. High frequency traders exist exclusively in the electronic arena. These
traders create artificial volume and push markets to cause radical swings for small profits,
the effect of which is to impair liquidity and eliminate true price discovery based upon
supply and demand as in the open outcry system,

25. ‘Ifa blended settlement is adopted to now include electronically traded
prices during the closing range, based upon volume weighted average prices, high
frequency traders will contral unfettered by supply and demand the settlement price.

26. The proposed new tule of a blended settlement based upon volume
weighted average price (“V WAP”), blending the electronic trading with. open outcry
trading during the close to determine settlement will cause market participants to leave
the market and in essence place settlement into the hands of high frequency traders to the

detriment of the open outcry system, and therefore the CBOT membership.



December 21, 2012

1am a market maker on the grain fioor of the Chicago Board of Trade. | support the current settlement

method and do not want it to be altered, t want settlement prices to be determined by oper-cutcry
trading in the pit an the close.

Thank you for your consideration in this matter.



i
i

~

things as may bo exercised or done by the Corporation, subject, nevertheless, to the provisions of the DGCL,
this Certificate of Incorporation and any Bylaws adopted by the Class A Member; provided, however, that no
Bylaws hereafter adopted by a member of the Corporation shall invalidate any prior act of the directors which
would have been valid if such Bylaws bad not been adopted.

B.A special meeting of members shall be called by the Chairman of the Board or the Board of Directors
of the Corporation upon receipt by the Chairman of the Board or the Secretary of the Corporation of a written
dicmand of a majority of the directors then holding office. .

C. Any action required or permitted to be taken by the members of the Comoration must be effected at a
duty called anxwal or special mesting of members of the Corporation and may not be effected by any consent: ~
in writing by such members, provided that the Class A Member shalt have the right to cfftct by consent in
writing any action which would require the approval of the Class A Member at a duly called annual or special
meeting of the members of the Corporation.

ARTICLE VI
BOARD OF DIRECTORS
* ‘The number of directors of the Corporation shall be as from time to time fixed by, or in the manner provided

in, the Bylaws. Election of directors need not be by written ballot unless the Bylaws so provide. The Board of
Directors of the Corporation shail at all times be comprised of the same directors as those of CME Group.

ARTICLE VII
AMENDMENT OF BYLAWS

The Board of Dizectors of the Corporation is expressly empowered to adopt, amend or repeal the Bylaws of
the Corporation. The Class A Member shall also have power to adopt, amend or repeal the Bylaws. The only
member of the Corporation with any power to adopt, amend or repeal the Bylaws of the Corporation shall be the
Class A Member, and no other member of, or class or series of membership in, the Corporation shall have any such
power. Except as specifically provided in the Rules, no member of, or class or series of membership in, the
Corporation shall have any power to adopt, amend or repeal the Rules.

. ARTICLE VII
LIMITATION OF LIABILITY

A director of the Corporation shail not be personally liable to the Corporation or its members for monetary
damages for breach of fiduciary duty as a director, except for ability (A) for any breach of the director’s duty of
loyalty to the Corporation or its members, (B) for ects or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (C} under Section 174 of the DGCL, or (iy) for any transaction from
which the director derived an improper personal benefit, If the DGCL is amended to authorize corporate action
further climinating or limiting the personel liability of directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullost oxtent permitted by the DGCL, as so amended.

Any repeal or modification of the foregoing paragraph shall not adversely affect any right or protection ofa
director of the Corporation existing at the time of such repeal or modification. For purposes of this Article VIII, the
term “director” shall, to the fullest extent permitted by the DGCL, include any person who, purstant to this
Certificate of Incorporation, is authorized to exercise or perform any of the powers or duties otherwise conferred
upon a board of directors by the DGCL.

. ARTICLE KX
AMENDMENT OF CERTIFICATE OF INCORPORATION

The Corporation reserves the right to amend, nyodify or repeal any provision contained in this Certificate of
Incorporation in the marmer prescribed by the laws of the State of Delaware, and all rights conferred upon the
thembers of the Corporation are granted subject to this reservation. Any amendment of, or modification or repeal of
any provision contained in, Section B(2), Section C, Sectlon D, Section E or Section F of Article TY or this sentence
of this Article 1X or, during the Transition Period, Article VJ of this Certificale of Incorporation (subject to the last



December 21, 2014

tam a market maker on the giain 1 Suppai
method and do not want it to be aftered. | want settiement prices to be determined by open-outery
trading In the pit an the close.

‘Thank yau for your consideratica in this matter.

ty) WY KOA rine

nese sNaKeT on Ine grain loor of the Chicago Board of Yrade. i support the current Seltreriene



Selling ERP Holder hereby authorizes CBOT to remit the proceeds from the sale of the BRP to CBOT to the
following account:

Bank Name:
Rank Address:

ABA:
Account:
Account Name:

[Signature Page to Assignment Agreement for the Sale of Exercise Right Privitege]