09/09/05

FRI 14:39 FAX 212 299 2298 NYMEX.

(C)

(D)

The President of the Exchange, at any time during the day, may call for variation
margins to meet the variations:in the market. Such margins shall be paid to the

Exchange within the time limits pi

Additional and Advance Margin

ribed by-the President.

In the President's discretion if the protection of the Exchange so requires, the President
may call for additional original margin from any one or more clear Clearing
Members in such forms, and at such times as the President may specify. The President
may lower the margins that were increased:when the Exchange no longer requires the

protection of increased margins.

Straddle Margins

(1)

(2)__Ontions Straddles

H

|

:

|

Futures Straddles i
i

if

tee

A Clearing Member carrying an-account Which has both a long and a short
futures position with the Clearing House in a particular commodity, in the same
or different contracts but in no‘évent for the same delivery month of the same
contract. may treat such long and short positions to the extent they are equal in
quantity as a futures straddle. igi js

positions to the-extenHul! 5

trade comprising a straddia ‘shall bé subject to separate brokerage and clearing
charges. Initial margins deposited shall be the higher required for either trade or
trades and when so déposited shall be sufficient for both trades but each trade
shall be brought to the settling price; daily. When one trade of a straddle
transaction is closed out dll, the remaining trade or trades that comprise the
straddle must have the required original margin deposited with the Clearing
House. BS

AClearing Member. carrying ap account which bas.poth (1) a short call option
CHAE -

anda long call gption; (2) 4 shod put option and aJong put option, (3). long put
gption and a long call option: or (4) a short put option and a short call option, ina

rats September 200SRMPREIFIPII/490 15.00005/749S68 204;

'Z0B7761,08°
© Page 19. >

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(M)__No change in records of any kind submitted {othe Clearing House shall be made unless
: approved by the Exchange after written application thereof by the Clearing Member is
made to the Exchange, stating the reason -for ‘such change.

UMD When clearing operation Ad
(My G-OPe :
procassing-rachines-amounts owed te the Clearing House-must-be-depasited in

(N)__Penalties imposed under this section shall not be subject to the provisions respecting
procedures for disciplinary proceedings. =:

(RQ) Concurrent Futures Positions

‘Drefh-- September 2005RMB-RFIFIPH/49015.00005/2195087,017087761,06
Page 13


VorMorvy AE Leth FAA £16 £99 £490 Ping Wuze

9.11A Give-Up Trades - Trades Executed

(A)

(8)

Open Outcry

‘Whose terms ahd conditions govem the

In the absence of a give-up agree!
/brokél customers and Clearing Members, the

responsibilities/obligations of exec
following rules shall define the res;
an order. The “executing broker", ag
Member Firm or Floor Broker. to whom the

NYMEX Europe.

Responsibilities/Obligations of Clearing Members

(1) Limits Placed by Clearing. Member. A Clearing Member may, in its
discretion, place trading limits on:the trades It will accept for give-up for a
customer's account from ai executing roker, provided however, that the
executing broker receives pfior written Ir electronic notice from the Clearing
Member of the trading limits on that account. Notice must be received by the
executing broker in a time! janner. A copy of such notice shall be retained by
the Clearing Member.

(2)- Trade Rejection. A: searing Member may reject ("DK") a trade only if: (1)
the trade exceeds the trading mits established under Section I(A) of this rule for
that customer and it has been communicated to the executing broker as
described in Subsection (A); of (2) the trade is an error for which the executing
broker is responsible. Ifa Clearing Member has a basis for rejecting a trade, and
chooses to do so in accordance with:the provisions of Rule 2.21(B), it must
notify the executing broker promptly

(3)—Biling Clearing Memmbor_ Blin, Excentin.connection with
brokefane fees incured fot tansacions exeouted a on a NYMEX Europe (where

incurred for “all trans transactio:
and subsequently accept
system. Floor brokerage fet
Clearing Member, custome

igréed upon in advance among the
xecuting broker.

(1) Customer Order Pi
determining that all ordet
order has been accepted

ecuting broker will be responsible for
ir authorized by the customer. Once an
je broker's clerk must:

(a) ith the customer;

(b) ording to its terms;

Drah-7-Seprember-200SRMP-REYF IDH/4901 S 0000s #9sea-85 20821



09/09/05 FRI 14:30 FAX 212 299 2298 NYMEX. oo7

(B)

(C)

(D)

(E)

(F)

(G)

(H)

The Board, upon recelpt of any application and report from the Clearing House
Committee, shall either approve or disapprove the applicant and, if approved,
the applicant shall be admitted to membership in the Clearing House. if
disapproved the applicant shall.not be permitted to file another application for a
period of one year from the date of notice of disapproval.

The application shall be accompanied by a written document guaranteeing to the
Clearing House the assumption of responsibility for any and all futures trades made in
the name of the applicant or his qualified floor traders and accepted by the Clearing
House. Any qualified member or members so approved can be guaranteed by only one
Clearing Member but may act as a floor broker for other Clearing Members.

Said guaranteeing document, in the case of a partnership or corporation, shall be
signed by the Exchange member of the partnership or corporation.

In the case of a corporation, the guaranteeing document shall be accompanied by a
copy of the resolution of the Board of the corporation authorizing the guarantee
required by this Rule duly certified by the Secretary or the principal officer of the
corporation.

Any lawfully formed and conducted cooperative association of producers, within the
meaning of the Commodity Exchange Act, which is engaged in any cash commodity
business, having adequate financial responsibility may become a member of the
Clearing House on the same terms and conditions as a corporation.

Applications for membership in the Clearing. House shall be accompanied by the
applicant's balance sheet prepared and certified to by a certified public accountant and
swom to as to the substantial accuracy by the applicant whose signature.shall be
acknowledged. The balance sheet of the applicant shall show a working capital (as
defined in Rule §9.23) of not less than $5,000,000.

Members of the Clearing House shall have the privilege of designating members of the
Exchange as qualified floor traders in-addition to their regular representative members.
Such qualified floor traders must be guaranteed by the Clearing Member and subject to
the approval of the Clearing House Committee.

All applicants prior to their election to membership in the Clearing House shall sign a
statement that if approved, they will observe and be baund by the Clearing Rules of the
Exchange and all amendments subsequently made thereto.

Dan fts-3 September 2005RMPARAIB] PH/490 1 5.00005/F49S08 7012087761, 06

Page 4


varusrua

FRi 44:40 TAA £16 £¥9¥ c£e¥O NYE

(E)

Pade cumocsine a ead Stallhe Subiect t to separate brokerage ‘and clear clearing
charges. Original margins deposited shall be the higher required for either trade
or trades and when so deposited shall be sufficient for both trades but each

trade shall be brought to {he settling price, gaily. When one trade of.a straddle

straddle must have the required original margin deposited with the Clearing
House Tes Ce

Clearing Members may meet original margin calls by depositing:

(1)

(2)

(3)

(4)

Cash (U.S. Currency);

Original Margin Certificates issued by an original margin depository, in form
acceptable to the Clearing House, for delivery to the order of the Clearing
House, representing securl ties issued by the Department of Treasury of the
United States of America maturing within ten (10) years from the date of the
deposit and guarantead as to principat and interest by the United States
Government; such securities Shall be valued at ninety five percent (95%) of the
par value; or

Subject to a maximum limi of 50% of ‘the Clearing Member's total original
margin obligations, Irrevocable Letters of Credit payable to the order of the
Clearing House including § 51 ttars of Credit that are deposited with the
Clearing Member in accordance with Exchange procedures by a customer, in
form acceptable to the Clearing House, issued by or confirmed by an original
margin depository and having an expiration date of not less than three (3) or
more than eighteen (18) months from the date of issuance; provided, however,
that such Letter of Credit may. not be used to meet original margin obligations
during the fifteen calendat: “days prior ‘to. the expiration date thereof (if the
fifteenth day prior to the expiration of ‘the Letter of Credit is not a business day,
the period during which such Letter of Credit may not be used to meet original
margin obligations shall begin on the | ‘business day immediately preceding that
day); and, provided further, that on the business day preceding the fifteenth
calendar day prior to the @ Letter of Credit, the Clearing House
shall issue a call for:onginal m be deposited in a form and manner
acceptable to the Clearing House f pasitions held open as of the close of
business on that day and: ‘margined by the Letter of Credit. The Clearing House
shall have the unqualified right to calf on any Letter of Credit at any time priorto
expiration.

Shares in a money marke utual fund that complies with CFTC Regulation
§1.25 and that has been approved by the Board, subject to the following
conditions: ma ES

Wuzs


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PRL 14.44 FAA £1e c¥¥ cev0 Nise

9.19

(A)

(A)

(B)

{of listed Exchange contracts shall be
cordance with Bylaws and Rules.

All deliveries or settlements in
made through the Clearing House Jr

Final Day of Trading

¥ th onth of a contract that is listed for

trading by open outcry on tha tradi ig floor.of the Exchange or of NYMEX Furope
lity of each Clearing Member who is not in a
jation.on any maturing contract by
luidating order entered on the

@ Limited floor one hour before the time
e closing range for such delivery month. All
9 xecuted prior to the expiration of

(1)

established for the ae
such orders shall be market arders t
trading.

(2) Onthe final day of trat ing intl 6 delivery month of a contract that is listed
for trading solely on NYMEX ACCESS® or onvan Alternative Electronic Trading
System, it shall be the rasparisibility ‘of each Clearing Member who is not ina
position to fulfiifulfil its conthattual obligation an any maturing contract by
prescribed notice and tendey, to have:a liquidating order entered on NYMEX
ACCESS® or an Alternative ctronic Trading System, as applicable. For the
purposes of this rule, the tem “Alternative Electronic Trading System” shall
mean any electronic trading! system other than NYMEX ACCESS® on which
NYMEX Division or COMEX
GLOBEX®.

ang-omberClaaring Member carrying open
own account or the account of any other
person as the result of an error may consent of the account owners, transfer any or
all of such contracts to any other a i learing

Member or to any other ef; provided, however, that;

(id)
Accept or Deliver for the spe fe col Has, by which time the clearing

(S) effecting the transfer, shall deliver to the Clearing

House written notification of such transfer in the form and manner prescribed by
the Exchange specifying thi i to. and the prices at which such
transfers were effected; and

(2) the i (s) must submit and retain records of all
forms presented to the var for the processing of any error transfer
trade. :

In the event that the error is disco afte tne close of trading on the last day of
trading in an expiring contract, but!before the trade is assigned to a clearing
fnomberClearing Member, a floor f fember.on.the Exchange or on NYMEX Europe
Limited may transfer the position he in error to any account carried by any élearing

Deaf: -Sepromber-200 SR MPREIFIPIL/49 0 15,00005/7195084, 64,

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AA Laed baa Lae £99 £490 amps

9.08

9.09

(A)

(B)
{C)

9.10

9.11

contracts between NYMEX and a pia r

such an auction that are given up for
clearing. OF

i
aS
i

The Clearing House shall not be liable for ai y obligations of a non-Clearing Member,
nor for any obligation of a Clearing Member'to'a non-Clearing Member, nor for any
obligation of a Clearing Member to another member of the Clearing House who is
acting for him as broker.

Clearing House Not Liable to Customer i

The Clearing House shall under no‘circumstai és become liable to make deliveries to
or accept deliveries from a customer of its Clearing Members, or in any way become

obligated to a customer by reason of any contract or, except as otherwise provided, to
exercise any option or accept assignment of Such exercise on behalf of a customer of
its Clearing Member, made for the custom: by a Clearing Member. Such customer
must look to his Clearing Member or broker fo make or accept all deliveries, to exercise
or accept assignment of exercise, of any options contract for all settlements.

Clearing Fees

Charges for clearing trades shall be fixed byithe Board upon the recommendation of the
Clearing House Committee and shall be payable by Clearing Members as billed. All
Clearing Fees shall be charged per ¢ contract bought, sold, delivered or accepted.

A minimum fee of $200.00 per mo shall be charged to Clearing Members.

Claims by Clearing Members for aijustments: to clearing charges or fees shall be made
to the Exchange within 90 days of the invoicing of such charges by the Exchange. The
failure to claim adjustments within: this peridd shall constitute a waiver of such claim by
the Clearing Member; provided, however, that the Board of Directors, for good cause
shown and following review by the Clearing, ‘House Committee, may authorize payment
by the Exchange of a late claim for adjustment filed within 6 months of the invoicing of
charges by the Exchange in excess of $1,000. Any late claim for adjustment paid by the
Exchange shall be subject to a 10% administrative fee that shail be deducted from such
payment. No claim for adjustment Will.be considered that is filed later than 6 months
after the invoicing of changes by the Exchange.

Trade Refused by Clearing Ho!

When the President deems the financial condition of any Clearing Member as

inadequate to carry any addition: insacti 's he'shall prohibit such Clearing Member
from clearing any new transactions. Any such member may appeal from the decision of
the President to the Board.

Transfer of Trades

Where a fromber makesEloor Member enters into a trade as-a-brekerfor another
frember of the Clearing HouseMemper, hes ‘Shall file with the Clearing House

e hour a: complete description of the trade,
giving the name of the Principal for whom he was acting as broker and on whose
Clearing Sheet the transaction is to be cleared; he shall be liable as principal upon such
trade until it has been accepted by the Clearing House for the account of his principal.



(J)

(kK)

9.04B

A For the purposes of this rule, the

PRL 24295 FAA 212 Z9¥ ZzZ9s NYMEX

principals in that transaction.

In the event that either Clearing Order is rejected as a result of the ERAV Credit Check
test, the EFS or EFP procedure would be deemed to have been terminated, and the
Parties to the Transaction and their tespective Clearing Members would be informed
accordingly. Thereafter, any determination:as to further action with respect to the OTC
Transaction would be resolved by the’ Partiés to the Transaction independently of the
their Clearing Members and/or the Exchange.

Trade Submission Deadlines. Transactions that are submitted, confirmed and accepted
for clearing, as further provided by Section (K) of this rule, prior to 2:30 p.m. Eastern
Standard time on an Exchange business day will be included by the Exchange for
clearing for that business day. ‘The Exchange raserves the right to modify these
business hours without notice at any time. The hours for electronic submission via the
NYMEX website shall be from 7:00:p.m. Sunday evening through 2:30 p.m. Friday
afternoon, except for the period from 2:30 p.m. to 3:15 p.m. (Monday-Thursday). The
NYMEX facilitation desk will be available to assist users from 7:30 a.m. to 5:00 p.m.
(Monday-Friday.) E

Clearance by Both Clearing Orders of Cradit Check. Upon clearance by both Clearing
Orders of the E-RAV Credit Check; the transaction shall be deemed to have been
accepted for clearing and will be routed automatically to the Exchange's clearing
system. Consequently, the EFS ar EFP procedure also shall be deemed to have been
completed, and futures contracts thereafter will effectively be substituted for the
Transaction that is thus extinguished between the Parties to the Transaction.

Notwithstanding the above, a Clearing Member also shall be responsible for accepting
and clearing a position for a Clearing-Order entered Into the Exchange's clearing
system for clearing following any non-operation of the Exchange's E-RAV Credit Check
functionality for the applicable account carried. by the Clearing Member.

Use of E-RAV Risk Filter for Trading on Specified Exchange Alternative
Electronic Trading Systems

"Alternative Electronic Trading System" shall
mean any electronic trading systetn'other than NYMEX ACCESS® on which NYMEX
Division or COMEX Division products are-traded, but not including GLOBEX@(1). (A)
No order for a contract traded on-ah Alternative Electronic Trading System
(:"AETS contract”) may be accepted for €niry into such system unless and until the
Clearing Member has input electronically to the AETS system, or related Exchange
systems as may be specified byt je. Exchange, the following required information:

(1) the account umber”

(Qo20


09/09/05 FRI 14:32 FAX 212 299 2298 NYMEX

tial-detaile-of-aliiransacti

_Allocation of trades to Clearing Members

entered ial cade bfomaton in eiaton to.any trade into the Trade

othe Excha
informati ation as may be- ‘prescribed by the Board. Snclu
customer account number, Clearing Member number and customer type
indicator code,

(2)___ Tardy submission of allocation information shall constitute grounds for a fine to
be issued by designated Floor Department Staff or. where determined as
appropriate by the Business Conduct Committee, as grounds forfarmal
disciplinary action under Chapter 8 of the Rules,

(3) _.Fines for the faijure to submit allocation information shall be levied by the
President in amounts as,the Board, by resolution, may prescribe from,time ta
time,

(4)___.. Each Floor Member, prior to the earliest opening of trading in.a contract in which
that Floor Member traded the previous trading. day, and at reqular intervals
during the trading day, shall be responsible to.review TMS for email messages
from customers and Clearing Members as to the proper allocation of trades.

{5)__On the day of the expiration of ap option contract, Clearing Members shall be
required to have a representative available, during the times specified by the
President or his designee, to.review Clearing House Reports and to make any

adjustments thereto,
{B)___..Submission of Position Change Statements
Each Clearing. Member-shalLno_lalot than such time as.the Roar, “nay. prasefibe fram

(0)

Clearing Members having trades for their own account and for.customers' accounts
shall file two Position Change Statements, each properly designated and setting out the

Clearing Member's 01
xchange Not Liable for Inaccurate Position Change Statements

All clearing data reported {o the Exchange by a Clearing Member follawing the
completion.of the operational procedures prescribed by the President shall be deemed
accepted by the Clearing Member and the Clearing Member shall waive any claim

Drafts 7-Seprember 205RMPREIFIPH/49015,00005/749S087.027

“Page d

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uy 7uy7ua

FKL La4idl PAA 212 z¥¥ 2294 NYMEX

(L)

9.03

(A)

(3) In the event that a claim(s) against the Member Firm aggregating in excess of
$10,000 is (are) asserted, pursuant to By-law 857, Rule 2.51, or Rule 5.19 or, if
by the Exchange pursuant to any-available means, the lessee who has
conferred the privileges of.a leased rnembership on the Member Firm shall,
within two business days, liquidate:all positions held by or on his behalf and
shall cease doing business as.a Member of the Exchange; provided, however,
that such action need not be taken ‘f, within two business days:

(a) the lessee demonstrates that he owns or leases more than one
membership; or

(b) the lessee, lessor or Member Firm deposits with the Exchange a Certified
check, payable to the Exchange, in an amount equal to the higher of the
price at which a Membership was last sold or at which a membership was
offered and acknowledges that such funds shall be available to satisfy any
and all valid claims against the lessee.

Provided, further, that in the event that the lessee continues to do business
pursuant to the provisions of (a) or (b) above, the leased seat shall be available
to satisfy any valid claims against the Member Firm.

Each member who is a proprietor of a corporation or partnership which is a member of
the Clearing House, pursuant to Section (K) of this Rule or otherwise, and as its
principal business clears the trades of its proprietors in the house account shall
guarantee to the Exchange, its members.and member firms in a form and manner
acceptable to the Exchange, the full and prompt payment of any and all obligations
arising out of Exchange transactions made by or on behalf of such member. As used in
this Section (L), the term proprietor shall. mean an officer, director, or owner or controller
of ten percent (10%) or more of the common or stack of a corporation or a general or
limited partner of a partnership.

Guaranty Fund

Contributions

Each Clearing Member shall deposit; and keep deposited, with the Exchange the
amount prescribed in Section (B) asa contribution to the Guaranty Fund. The monies,
securities, and instruments so deposited shall-collectively constitute a fund known as
the “Guaranty Fund" and shall be used as provided in the Rules to reimburse the
Exchange for any loss sustained by the Exchange as a result of the failure of any
Clearing Member to discharge his obligations in accordance with the Rules,

‘Dealt: 7-Soptomber 2005RMP/RFIFIPH/490 | .00005/3495084-94 708776106.

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(I) The President shall refer to the Clearing House Committee for its consideration the
application and supporting documents after the President is satisfied that the financial
requirements have been met.

(J) Where a Clearing Member guarantees more than six qualified floor traders he shall
have, in addition to the capital required for each: Clearing Member, an additional
$50,000.00 of working capital for the guarantee of each qualified floor trader in excess
of six.

K)

‘ (1) Acorporation that is wholly owned by one member may be granted membership
in the Clearing House provided that the provisions of this subsection have been
met. The corporation must be a Member Firm upon which member privileges
have been conferred by the owner of the Member Firm, or by the owner and a
lessee leasing a membership from the owner of the corporation. The owner of
the Member Firm must own both memberships. The lease agreement, if any,
shall provide that the lease agreement shall terminate immediately upon the
failure of the Member Firm to-meet its obligations to the Exchange or its
Members and that the membership shall be available to satisfy such obligations.
The member firm must have and maintain $250,000 working capital; and the
obligations of the Member Firm to.the Clearing House must be guaranteed by its
owner. Such a Member Firm will be permitted to Clear trades executed by or for
the account of the owner and to qualify only the owner. The Member Firm may
not qualify, clear or guarantee the trades of a lessee who confers membership
privileges upon the corporation. The Member firm must maintain at all times at
the Clearing House original margin deposit of $100,000 regardless of lesser
applicable margin requirements. The Member Firm must file with the Exchange
financial statements as follows: a certified financial statement within ninety (90)
days of the close of its fiscal year and quarterly financial statements within forty
five (45) days of the close of each fiscal quarter other than the last fiscal quarter.

(2) Inthe event that a claim(s) against the lessee aggregating in excess of $10,000
is (are) asserted, pursuant to any avallable means, the Member Firm shall,
within two business days of the assertion of such claim, liquidate or transfer all
positions cleared on the books of the Member Firm and cease doing business
as a Member Firm; provided, however, that such action need not be taken if,
within two business days of the assertion of a claim, the owner of the Member
Firm deposits and maintains with the Clearing House $300,000 original margin
in addition to the margin requirements of this Section (K) to satisfy any and all
claims that may be raised against the Member Firm or its owner and within thirty
calendar days of such claim, the privileges of another membership owned by
the owner of the Member Firm are conferred upon the Member Firm. On the
effective date of the substituted conferred membership privileges, the $300,000
additional original margin may be-returned to the owner of the Member Firm.
The original leased membership shall remain available to satisfy the claims, if
valid, against the lessee.

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Page 5

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uy7ug7US  FRL 14:39 FAX 212 299 2298 o21

(2) the contracts approved for trading for that account;

(3) with respect to trading onan: AETS, the Risk Allocation Value for that
account using the Exchangé:s enterprise risk allocation value system
(ZE-RAV"2); and a

(4) in addition to the Risk Allocation Value, setting net short and net long
position limits for each contract permissioned by the Clearing Member for that
account.

(B) The E-RAV risk filter does not ap fo trading activity for the Regular Trading Hours
session or trading activity for the NYMEX ACCESS® trading session. Trading on
NYMEX ACCESS® is governed by: a separate and distinct risk filter.

(C) With respect to an AETS, the E-RAV dollar limit for a given customer account
permissioned by the Clearing Member for trading on such a system will not be used by
the AETS as part of the risk’filter for. that system. instead, the AETS will only utilize the
net long and net short position limits:set by the Clearing memberMember for each
contract permissioned for that-customer, and Clearing Members should set such
position limits accordingly. : :

(D) A Clearing Member may modify at: ‘any time by electronic input in the manner provided
to the Exchange the information required by Section (A).

(E) | AClearing Member agrees unconditionally to-accept and to clear all trades executed for
that account for which it has input Information pursuant to Section (A), regardless of
malfunction or non-operation of thé Exchange”'s contracts order filter functionality, the
Risk Allocation Value order filter functionality, and/or the position limit functionality.

HEL =

(F) Following input of the information. required in Section (A) above for any account, an

order for such account may be executed by or on behalf of the User for such system.

{ :
(G) Notwithstanding Section (F) above, the Exchange, as provided by Rule 8.99A

(“’Summary Procedures for Denial of Access”) shall have the right without limitation at
any time to terminate a User's passwords and access to the AETS.

9.05 Margins

It shall be incumbent upon each Clearing Member that his trades and trades of his
customers be margined up to the; time of the acceptance of such trades by the Clearing
House. :

(A) Original Margin

at the discretion of the Board:

(B) Variation Margins.

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09/09/05

FRI 14:32 FAX 212 299 2298 NYMEX

9.03A

(A)

(B)

(Cy

(D)

9.04

After a Clearing Member ceases to:be a Clearing Member of the Exchange and after all
obligations of such member to the Exchange shall have been discharged in full, the
amount of the Guaranty Fund that to: which such Clearing Member is entitled shall be
returned. Any expense, including counsel fees, incurred by the Exchange in connection
with a Clearing Member's deposit or the return thereof, may be charged to the Clearing
Member: :

Use of the Guaranty Fund

The Exchange may at any time and from time to time assign, pledge, repledge or
otherwise create a lien on or security interest in; the Guaranty Fund and/or the cash,
securities and other property held ‘in the Guaranty Fund to secure the repayment of
funds borrowed by the Exchange (plus interest, fees and other amounts payable in
connection therewith).

Any such borrowing shall be on terms and:conditions deemed necessary or advisable
by the Exchange (including the collateralization thereof) in its sole discretion, and may
be in amounts greater, and extend for pariods of time longer than the obligations, if any,
of any Clearing Member to the Exchange for which such cash, securities or other
property was pledged to or deposited with :the Exchange.

Any funds so borrowed shall be used:and applied by the Exchange solely for the
purposes for which cash, securities: and other property held in the Guaranty Fund are
authorized to be used pursuant to Exchange Bylaws and the Rules; provided that the
failure of the Exchange to use such funds.jn ‘accordance with this Section (C) shall not
impair any of the rights or remedies of any:assignee, pledgee or holder of any such lien
or security interest.

Cash, securities and other property held in the Guaranty Fund shall remain the property
of the respective Clearing Members depositing such cash securities and other property,
except that:

(1) such property shall be subject to the rights and powers of the Exchange with
respect thereto as set forth in Exchange Bylaws, the Rules, and any
agreements between any Clearing Member and the Exchange; and

(2) such property shall be subject'to the rights and powers of any person to which
the Guaranty Fund or any.cash; securities or other property held therein shall
have been assigned, pledged; repledged or otherwise subjected to a lien or
security interest.

Clearing Procedure

Drsl-F September 20HSRMPREI 211/490 15,00005/2495087-07 70;

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Bo


uysuy ud

FKL 14:43 FAX Z1Z Z¥Y “Zz98

(c) confirm the executio to the customer as soon as

practicable; and

(d) transmit such exec fod ‘order to the Clearing Member as soon as
practicable in accordance with} xchange Rules and procedures.

2

2) Use of Other Persons. Unleg greed in writing, the executing broker

is allowed to use the servi roker in connection with the broker's
obligations under these rules. ting broker remains responsible to the
customer and Clearing Member under these rules.

3

{3)___Executing Broker Respons} lity for Verifying Clearing Member Authorization.
Prior to a broker accepting|and ‘executing an initial order for any new customer
account, the executing broker must ca firrn with the Clearing Member by
telephonic, electronic or writt pmeans, that:

lif

i

(a) the customer has aly id account with the Clearing Member;

(b) the account numbel

{c) the brokerage rate;
i

(d) the customer is aut
the executing broke!

opy.of the authorization or the specifics of
(ides: opposite party, date, time, and any
tion: of such information shall be the

i
The executing broker must
the telephonic confirmation, ¥
other relevant information|
basis for disciplinary actiot

4

1 executing broker has confirmed

(4) Rejection of Customer. Ord
ite ‘orders on behalf of a customer in

accordance with this Rule!
reject an order that thé cu:
broker shall promptly notit
such rejection.

9.12 Substitution

The Exchange may accept cont
and by such acceptance shall, in plar

‘Dro Septombor- 2005 RMPREIAIPH/4901 5,00005/71954

027


09/09/05 FRI 14:28 FAX 212 299 2298 NYMEX @oo2

oS
“New York
Mercantile Exchange

2 FH A 28

OFC.Or Tic

TARIAT

September 9, 2005

VIA FACSIMILE TRANSMISSION
Office of the Secretariat

Commodity Futures Trading Commission
Three Lafayette Centre

1155 21° Street, N.W.

Washington, D.C. 20581

RE: Rule Certification. NYMEX Submission 05.163: Implementation of Rule
Amendments in Connection with Launch of NYMEX Affiliate in London

Dear Ms. Webb:

The New York Mercantile Exchange, Inc. (“NYMEX”) is notifying the Commodity
Futures Trading Commission ("CFTC’) of a self-certification filing involving various rule
changes to certain settlement rules in NYMEX Chapter 6 and to the clearing rules
contained in NYMEX Chapter 9. In a prior filing for which NYMEX recently received
regulatory approval, the Exchange set forth a proposed procedure to be utilized in
connection with the close-out of existing open positions in NYMEX's Brent Crude Oil and
Northwest Gasoil futures contracts following NYMEX's delisting from trading of those
contracts. NYMEX is delisting both contracts for trading on NYMEX following the close
of today's regular open outcry trading session in Dublin, Ireland. In addition, today will
be the last day of operation of NYMEX’s branch trading floor in Dublin.

Commencing on September 12, 2005, NYMEX's London affiliate, NYMEX
Europe Limited (NEL), will be listing these two futures contracts for trading as its initial
product slate in connection with the official launch on that day of this new market. As a
note, NEL had previously indicated that it might also be listing a Brent options contract
as part of its initial product slate. More recently, though, NEL has determined to defer
briefly the listing for trading of this option contract. Accordingly, at such time that NEL
determines to list for trading this Brent option contract, NYMEX will contact CFTC
clearing staff and consult with them in connection with the processes for listing by
NYMEX of such product for clearing purposes and any such listing will be undertaken
consistent with the conditions included in a recent CFTC order to NYMEX in connection
with Section 4d of the Commodity Exchange Act.

NYMEX will continue to list both of the two futures contracts noted above for
clearing in its capacity as a registered derivatives clearing organization. Thus, the
existing position limit, position accountability and large trader reporting rules will remain
unchanged.

Finally, in a subsequent filing to be submitted in the near future, NYMEX will
submit various rule amendments deleting certain rules now in piace that pertain

Now York Mereantile Exehange, hie
World Financial Genter The New York Me

One North Bad Avenue The NTMEX Di

New NY 10282-1101 natural gas, clectricicy, eval, pr

(212) 299-2000 offers crnding in guld, silver, copper, and alteminsnt,

rcantile Exchange, [nc., ts composed of rive divisions.
ion offirs trading in crude vil, enting ail, wileaded gasoline,
rane, platinum, and palladium, The COMEX Iivision



09/09/05) FRI 14:33 FAX 212 299 2298 NYMEX

Mors

refit eptember 2005RMPAREIFPL/49015.00005/7495082-O370RT76 LOG
ge


09/09/05 FRI 14:33 FAX 212 299 2298 NYMEX

against the Exchange based ypon inaccurate-or erroneaus data appearing on said

(£)___Marain

{E)

At times and under procedures established by the Board each Clearing Member shall
deposit with the Exchange required variation margin-and original margin in such form
as is acceptable to the Exchange: The Exchange in like manner shall pay each
Clearing Member such amounts. as are dué such Clearing Member. The amountof
margin payable (0 toor by the Exchange Se Bloresaid. shall be such ameunt-as-ie

(Bon each trading day shall be calculated on the basis of the onen trades allocated to

that Clearing Member at the end.of the preyious trading day as stated in its Position
Change Statement as adjusted by any position transfers or trade transfers made before

Payments for Original Margin

Each Clearing Member, at the time when payments are due to the Exchange as
aforesaid, shall have deposited with the Exchange payment, in such form as is
acceptable to the Exchange, for any original margin that may be required, as prescribed
in these rules.

(G}Keceptance-of Reperts-Final

Dra 3-Sepiomber-200SRMPARFIF 1PH/490 | 5.00005/7495087-04.708776 1.06

Page 10

Qor3


Uys us/ us

FRI 14:31 FAX 212 299 2293 NYMEX

(B)

(C)

(D)

(E)

Schedule of Contributions

The amount required to be deposited by each Clearing Member shall be calculated as
follows:

(1) Dual Division Members: The aggregate of 10% of the firm's modified
capital, calculated independently for each Division, as defined in Rule
9.20(A)(1) and based on the most recent financial statement submitted to the
Exchange, with a maximum contribution of $4 million.

(#2) Sole Division Members: 10% of the firm's modified capital, as defined in Rule
9.20(A)(1) and based on the most recent financial statement submitted to the
Exchange, with a minimum contribution of $100,000 and a maximum
contribution of $2 million.

The amount deposited shall be in the form of cash or securities issued by the
Department of the Treasury of the United Statés maturing within ten (10) years of the
date of the deposit and guaranteed as to principal and interest by the United States
government valued at ninety-five percent (95%) of par value.

Custody

(1) The Guaranty Fund shail ba deposited in a special account in the name of the
Exchange in such depositories in the City of New York as may be designated by
the Board.

(2) The Board shall be empowered to.invest and reinvest all or part of the funds
constituting the Guaranty Fund in‘direct obligations of the United States and/or
to deposit said funds at interest. Such investments and deposits shall be at the
tisk of the Exchange. All net income and gains on such investments and interest
on such deposits shall belong to thie. Exchange and shall be withdrawn from the
Guaranty Fund and deposited with the general funds of the Exchange.

Impairment

If the Guaranty Fund or any part thereof be lost or become unavailable from any
cause other than the default of the depositing Clearing Member, the amount so lost or
made unavailable shall be forthwith restored by transferring thereto all of the surplus.of
the Exchange that may be necessary, except such amount as the Board may, in its
discretion, decide to retain as surplus for future operating expenses, and if the amount
thus transferred from surplus be not sufficiént'to cover the entire loss, the balance of
such loss shall be made up by an:asseSsment in equal shares upon each of the
Exchange members. Such assessment Shall-be paid to the Exchange immediately (but
in no case to exceed one business day) after notice in writing thereof shall have been
mailed to each of the Exchange members:

Surrender of Guaranty Fund Deposit

Drall-7-Septomber- 200SRMP/REIBIPH/49015.00005/3195087,017087761,06

Page 7

@o10


O9/U9/U5 FRI 14:41 FAX 212 299 2298 NYMEX.

(F)

(G)

(H)

9.06

(ia) for purposes of orig ial margin, such shares will be valued at 95% of
market value; {ii) a Cléaring Member's participation in any approved fund
shall be limited to nolmore than 5% of that fund; and (iii) no more than

25% of the total assets Of an approved money market mutual fund may
be used to meet ori nal marg

The Clearing House shall have the|ri
use as original margin by any Clearing Member of letters of credit or of securities under

this Rule.

The Clearing House shall retain-the original [margin ‘deposited with respect to any
futures contract against which'a delivery notice has been issued until the business day
after the delivery date or such date as designated by the Clearing House.

Customer Accounts with the Exch

(1) Except as provided in subse n (2) below, all customer funds deposited with
the Exchange shall be heldjin accordante with the Commodity Exchange Act
and Commission Regulation 4,20 in'an account identified as Customer
Segregated. Customer furids shall Segregated by the Exchange and treated
as belonging to the customers of thes
Pursuant to this Rule; 6Clearing Members registered as
Futures Commission Merchants shall not be required to obtain a segregated
acknowledgment letter from the Exchange.

inge for cleared transactions in
lay 'be deposited in either a member
count. Neither account shall be treated

(2)

all be limited to losses resulting from the
tracts. between Clearing Members, or in

Losses to be borne by the Cleari
substitution of the Clearing Hou

Qo2a


Vor Verve FR 44.40 ran £16 £99 £490

rmombert eating Mamibet provided

FremborClearing Member carrying
Exchange and retain a copy of the
such position.

(excluding the defaulting

rneraborClearing Member) pay the

‘Drafl:-7- September: 206SRMPARFIFIPH/490 15. 000s iss087 93708776)

wuou


09/09/05

FRI 14:30 FAX 212 299 2298 NYMEX

(C)

(D)

9.04

9.02

(A)

The Exchange, the Clearing House, and the Clearing House Committee assume no
liability in any clearing transactions, so far as fraudulent warehouse receipts are
concemed, or the failure of insolvency of banks, or depositories.

In connection with the clearing of certain over-the-counter transactions in
Exchange-designated pari-mutuel auctions, the Exchange may determine to facilitate
the clearing of such transactions by establishing only for operational purposes one or
more Exchange clearing memberClearing Member numbers and/or processing
accounts. Notwithstanding the establishment of any cleaing-memberClearing Member
number or account, the Exchange shall not be subject to the duties, obligations and
requirements imposed upon Clearing Members under Exchange bylaws and rules.

Direction of the Clearing House

The general direction of the Clearing House and its operation shall be under the
jurisdiction of the Clearing House Committee, subject to the approval of the Board. The
President of the Exchange shall be Manager of the Clearing House, subject to the
direction of the Clearing House Committee.

Membership in the Clearing House

Any Member Firm may, with the approval of the Clearing House Committee and the
Board, become a member of the Clearing House in the manner hereinafter set forth,
provided:

(1) that the applicant must have such business integrity and financial responsibility
as to justify the Clearing House in assuming the risk involved in the clearing of
the applicant's trades;

(2) that a bona fide office can be continuously maintained in the City of New York
and a bank account maintained with a bank in the City of New York acceptable
to the President. A Clearing Member not having an office in the City of New York
may satisfy the condition respecting a bona fide business office in the City of
New York-by: A) by designating another Clearing Member or member of the
Exchange having a bona fide business office in the City of New York to act for it
in all matters requiring action by a Clearing Member under the Bylaws and
Rules of the Exchange and to recelve on its behalf all notices or other
communication including legal process in connection with Clearing House
and/or Exchange transactions, such designation to be in form satisfactory to the
Clearing House Committee; or B) presenting a plan for a “remote clearing
solution” to the Clearing House Committee and having such plan approved by
the Clearing House Committee. The Clearing House Committee may adopt
rules, subject to the approval of the Board, respecting the nature of the office to
be maintained in New York by'a Clearing Member as well as the conditions to be
complied with by a Clearing Member not having an office in the City of Now
York.

Draft Seplembor 200SRMP/AFIFIPH/49015,00005/3+95087,04704776 1.06

Page 3

ove


09/09/05 FRI 14:35 FAX 212 299 2298

(1) Concurrent long and short futures : itions in the current delivery month may
not be offset by netting, transfer, expit, adjustment or any other bookkeeping
procedures, but each side must be offset by.normal floor transactions in
accordance with Exchange Rules, Provided; however, that a clearing
rnomberClearing Member will be-exempt from this requirement if: (i) one side of
the concurrent position is established the business day prior to the date that the
offset memoranda are filed with the Clearing House; (ii) a elearing
paoraberCle smber filing such offset memoranda can satisfy the

Exchange at its request that the bled in effecting the offset i is attributed to. an

thata-cleari
gS

{2)____For the purposes of this Rule 9.04(P), the:current delivery month for energy
futures contracts commences on the:epengpening of trading on the third
business day prior to the termination of the respective futures contract, including
the termination date. ‘The current délivery month in platinum and paliadium
commences on the tenth (10th) business day prior to the first business day of
the delivery month.

{Q) Metals Inventory Report. :
he A OF-GIE A-reperota

9.044 NYMEX GloarPortTM ClearPort(sm) Clearing: Use of EFS and EFP Procedures for

(A)

Trade Submission

Scope of this Rule. This rule govems transactions not executed on the Exchange
("Transactions") that are submitted to NYMEX via NYMEX Clearer Cla:

Clearing for clearing in connection with-acontract that is listed for clearing only or listed
for trading and clearing on the Exchan: ns of:the provisions of this rule govern
transactions submitted to clearing that h been executed in an over-the-counter
pari-mutuel auction, which are instead governed by the terms of Rule 9.40C. In
submitting a transaction to NYMEX CleatPort(sm) Clearing or in allowing a transaction
to be submitted to the Exchange fo NYMEX ClearPort(sm) Clearing, the two parties to
the Transaction shall be deemed to have mutually agreed to initiate a process to
substitute their transaction fora standardized futures contract listed for clearing only or
listed for trading and clearing on the Exchange. For purposes of this rule, the two
principals in the transaction shall be referenced as the "Parties to the Transaction.”

Braft:--Soptumbor 2005RMP-RESFIPH/4901 5.00008/249 5087047087761 06

Pagat4-

@o17


uyzug7us

FRI 14:37 FAX 212 299 2298 NYMEX

(F)

(G)

(H)

()

Establishment of Authorized Commodities: and Total‘Risk Value. For each account
number that has been registered withthe Excharige pursuant to Section (E) of this rule,
a Clearing Member also must input into the Exchange's Risk Allocation Value "E-RAV"
system authorization indicating the specific: commodities for which a Transaction may
be submitted to the Exchange pursuant to this rule and the risk value(s) assigned by the
Clearing Member for Transactions for that account.

Trade Deletion Procedures for Transactions Submitted via NYMEX Web Interface.
Following submission of the trade details to. the web interface by an OTC Broker (or by
Exchange staff as mutually agreed by the Parties to the Transaction), an e-mail will be
transmitted ta the Parties to the Transaction notifying them that they have been listed
as counterparties in a Transaction that has been submitted to the Exchange. Following
such submission, a buyer or seller may not unilaterally reject the trade terms previously
submitted to the Exchange. However, ‘in order to.correct an error resulting from the
good faith actions of the OTC Broker or Exchange staff, as applicable, and upon mutual
consent of the Parties to the Transaction,-an OTC Broker or Exchange staff, as
applicable, may void the transaction provided; however, that this void response is
received by the Exchange within sixty (60) minutes of the time of the initial submission
of the transaction to the Exchange.

Following the posting of the transaction on the Exchange, the Parties to the Transaction
shall have no recourse or remedy under Exchange tules and procedures against any
OTC Brokers and/or Clearing Members in connection with that transaction and instead
would need to pursue such private: sremedies as would be otherwise available under
existing law.

Entry of Clearing Orders. Fora Transaction submitted to the Exchange pursuant to this
tule, such transaction first will be routed ta the Exchange's E-RAV Credit Check system
The time of entry of a Clearing Order inté the Exchange's E-RAV system will be
recorded by the system and will bé-used-by the Exchange as the time that an E-RAV
Credit Check was conducted pursuant to: Section (I) below.

Use of E-RAV Credit Check system. The. Exchange will conduct an E-RAV Credit
Check for each Clearing Order. The E- RAV. Credit Check will confirm whether the
Clearing Member carrying that atcount has authorized that account for transactions
submitted pursuant to this rule in. the c iodity involved in the Clearing Order, and
confirm whether the entry of the Clearing Order into clearing would fall within the OTC

risk value(s) established by the Clearing Member.

At all times until both Clearing Orders have successfully cleared the E-RAV Credit
Check, a transaction submitted to the Exchange pursuant to this rule shall remain as an
uncleared, bilateral OTC transaction wherein the Parties to the Transaction continue as

Drofi-7-Soptamber- 200SRMPRETFJPH/490 15.00005/249508704;

do1g


U9/09/05 FRI 14:29 FAX Z1Z 289 2298 NYMEX go05

AMENDED VERSION OF NYMEX, INC. RULEBOOK CHAPTER 9 CLEARING RULES”

Note: Important Note

As of May 16, 2003, this chapter governs the processing and clearing of COMEX
Division transactions as well as NYMEX Division transactions. In addition, as of May
16, 2003, all bylaws and rules of the COMEX Clearing Association are no longer In force
or effect.

Furthermore, as of September 12, 2005, this chapter also governs the processing and
clearing of NYMEX Europe Limited transactions.

9.00 Nymex Europe

(A) __For purposes of these Chapter 9 jules and except.as otherwise noted within a particular
tule, references to requirements, conditions or procedures applicable to NYMEX oc the
d

ar.NYMEX Division requirements, conditions Or procedures,

transactions on that exchange, will provide. reports to NYMEX Europe Limited as

necessary and will provide such other information to NYMEX Europe Limited as may be
required for its business and regulatory operation:

(C)___In.connection wilh providing cleation services for trading activity on. NYMEX Europe

(1)__governing the formation and allocation of contracts in respect of products
atket (NYMEX Europe

admitted to, trading on NYMEX Europe Limited's mat
Contracts"), and

(2) tothe: extent only Sit the toile to Destandted Non-Members (as defnedin ie

Bae Lineg RYMEX Europe Lined ‘default rules and.tules ee
defi ed E:

and acknowledges that it js, accordingly subject to the NYMEX Europe Rules in entering
into any such NYMEX Europe Contract.

9,00A_Liabillty of Exchange

(A) | AClearing House shall be maintained and operated under the Bylaws and Rules of the
Exchange, for the purpose of clearing all trading of members on, or subject to the
Bylaws and Rules of, the Exchange.

(B) | Wherever these Rules create a right in faverfavour of the Clearing House, or impose a
liability on the Clearing House, it shall be construed as the right or liability of the
Exchange and shall be enforceable by or against the Exchange.

Prehe2 Sepiomber- 200SRMPRFIFLPH/4901 5. 00005/2498007-O12087261.06
Page 2


09/09/05

FRL 1ld:43 FAX 212 299 2298

9.13

9.15

9.16

917

9.18

toward the other party thereto, assur
and become vested with all-the rig
buyer the position of seller and to
As between the Exchange -and:eat f
and conditions thereof shall continue.

sition of buyer, as the case may be.
to an accepted contract the terms

Bank Holidays
When the Exchange is open for. business on aday banks are closed, because of a legal
or bank holiday, the time limit for settiement Clearing House accounts shall be

extended to the next bank business,

Omnibus Accounts

No Clearing Member may execute cantracts for future delivery or options contracts on
the Exchange for a carrying house which does not disclose the names of its customers
or options customers (omnibus accounts) unl ss the carrying house agrees that it will,
on request of the Clearing Member} disclose to the Clearing Member, the names,
addresses, positions and transacti 1B its tustomers; provided, however, that the
Clearing Member shall not call for such information unless requested to do so by the
Board, a Committee of the Exchange ¢ or the President. A copy of such agreement shall
be made available by the Clearing Member upon request of the Exchange.

Refund of Clearing Fees

Should the income of the Exchang from Clearing Members in any year be in
excass of its expenses for such year, joard may, in its sole discretion, return any or
all of such excess income to Cleai Membefts in the proportion that the number of
contracts cleared by each Clearing|Membe on: Which a clearance fee was charged by
the Exchange during such year bears:to:th otal number of such contracts cleared by
the Exchange during such year. Theldecision Of the Board with respect to the
determination of excess income andthe deGisign whether to return, retain or otherwise

use such excess income shall:be conclusive.

Transaction Fees

Clearing Members shall collect fro member customers a transaction fee as

established by the Exchange for.eac ommadity contract bought or sold or otherwise
cleared on or subject to the rules of Exchi 1g¢, shali collect
fom non-member customers.a.tral psaction fee.as established by the NYMEX Europe

-or.80ld on or subject to the rules of NYMEX
pales atest and remit said: feeg Cléaring-House as billed.
Delivery Procedure

Commodities bought or sold:on Exthange ot NYMEX Europe Limited contracts shall be
delivered and accepted in-accord: ith the provisions of this Chapter,
supplemented by provisioris of th ofthe Exchange.or of NYMEX Europe Limited
applicable to individual commoditi By question :affecting the handling or delivery or
any commodity which is not specifically covered by the Bylaws and Rules may be
referred to the Board for determination

Delivery Through Clearing Hou:

Dreft:-7 Seplember 20052 MPAGHE J PH/490 1 5.00005/H49508F

(g028


09/09/05

FRI 14:29 FAX 212 299 2298 NYMEX

specifically to the Dublin facility as those rules no longer will be operative with the
closing of the Dublin branch facility.

Pursuant to Section Sc(c) of the Commodity Exchange Act (“Act”), CFTC Rule
40.6, the Exchange hereby certifies that these rule changes comply with the Act,
including regulations under the Act. These rule changes will become effective on
September 12, 2005. Should you have any questions concerning the above, please
contact the undersigned at (212) 299-2207.

Very truly yours,
Brian Regan L.
Vice President & Géunsel

@Boo4q


09/09/05 FRI 14:34 FAX 212 299 2293 NYMEX

When a Clearing Member is long or Short any amount of commodity futures and options
contracts at the end of the day, as indicated by his Clearing Sheet, settlement shall be
made with the Clearing House to the settlement price or premium for that day, and such
Clearing Member shall pay to, or collect from; tha Clearing House any debit or credit, as
the case may be, represented by the:difference between the price or premium at which
the contract was bought or sold, and the’settlement price or premium of the commodity
for that day. After making such settlement with the.Clearing House such Clearing
Member shall be deemed long or short such commodity and option, as the case may
be. at the settlement price of the day. :

4)

(H) Clearing Sheets

Qn each trading day ("T+4 ") followiga atrading day (°T”). the Exchange shall make

{1)__.the amount due to or from guich Clearing Member on account of all its adjusted
trades; :

(2)__the.Jotal amount of margin due to or from such Clearing Member in respect of
trades made gn T; and:

options entered intoonT.

().,._Reporting of Disputed Trades

Disputed trades shall not appear on any Clearing Sheet prior to the settlement of such
disputes.

Separate Deposits and Reluns for Hause ana custome 2

Senina Members shall pay jo ne Gato Hause Separate Solisment demasits for
le les fort 2 S..

@o15


09/09/05 FRI

(B)

(C)

(D)

(E)

14:37 FAX 212 299 2298 NYMEX

Transactions: Compliance with Regulatory Exemptions and Exclusions. Each of the
Parties to the Transaction shall be responsible for erisuring that the Transaction
complies with CFTC regulatory requirements as. ‘applicable for such transaction,
including as appropriate compliance with the terms of a statutory exemption or
exclusion under the Commodity Exchange Act from other CFTC regulation relied upon
by the Parties to the Transaction. os

Substitution of NYMEX Futures for the Transaction. The process of substitution of a
NYMEX futures contract for a Transaction shall not be deemed to have been completed
unless and until the Parties to the Transaction have successfully concluded the
submission of the Transaction to the Exchange as an exchange of futures for physicals
(EFP) or as an exchange of futures for swaps (EFS), as applicable, pursuant to the
respective provisions of NYMEX Rule.6.21 or Rule 6.21A and the provisions of this rule.
For forward transactions involving.deferred delivery of the physical commodity to be
submitted to the Exchange, the Parties to.the Transaction shall utilize the EFP
procedure, and for swap transactions to be Submitted to the Exchange, the Parties to
the Transaction shall utilize the EFS: procedure.

Trade Submission Procedures. All transactions submitted to the Exchange pursuant to
this rule must be submitted In accordance with the procedures established by the Board
of Directors for this purpose, as amended.from time to time. The Parties to the
Transaction and any OTC Broker authorized to submit executed transactions on their
behalf to the Exchange and authorized for related activities shall be exclusively
responsible, both individually and jointly, for accurately confirming the details of the
Transaction to the Exchange. Once submitted, all such transactions, subject to the
tules for trade adjustments set forth in Section (G).of this Rule, shall be deemed final.
Neither the Exchange nor a Clearing Member carrying the account of either party will
have any responsibility in the confirmation of trade terms for the EFP or EFS
transaction. 2 ¢

Registration of Eligible Participants, Eligible Accounts and Authorized OTC Brokers.
Each Clearing Member must register with the Exchange in the manner provided any
customer authorized by the Clearing Member to submit transactions to the Exchange
pursuant to this rule, and must.also register with the Exchange the applicable account
numbers for each such customer. For each such account, the Clearing Member
carrying that account also must submit to the:Exchange in the manner provided the
name of any OTC Broker(s) who has registered with the Exchange for services
provided by the Exchange. and who is authorized by the customer to act on its behalf in
the submission of executed transactions to the Exchange and related activity.

For any such OTC Brokers authorized by the customer and submitted to the Exchange
by the Clearing Member, such submission by the:Clearing Member will not constitute
an endorsement or ratification of the customer's authorization of the OTC Broker.
Moreover, submission of OTC Brokers authorized by the customer will not mean that
the Clearing Member is in privity with, has a relationship with and/or is otherwise
standing behind any of the customer's auttiofized.OTC Brokers, and the Clearing
Member will have no responsibility for,any.such OTC Brokers selected by the customer
and no duty or obligation to’ supervise the. activities of any such OTC Brokers.

Draft 7 September 2005 RMEAREIFJPH/49015,00005/495087017087 781,06

6.06
Pag

ois