Notice No. 01-20
January 22, 2001

TO:  All COMEX Members/Member Firms
All COMEX Clearing Members
All COMEX Floor Traders
All COMEX Operations Managers

FROM: Michael Campanelli, Vice President
Floor Operations / COMEX Division

RE:  Options Expiration Operational Procedures for the Trading Floor and 
Clearing Members
_____________________________________________________

The expiration date for the February 2001 options contract for Copper (HXG01) 
is Friday, January 26, 2001.

 GENERAL OPERATIONAL PROCEDURES

All Clearing Members and Qualified Floor Traders that carried an options 
position as of the close of business day prior to the expiration day, or 
engaged in trading activity on Expiration Day in the expiring options 
contract will be required to have a knowledgeable, duly authorized on-line 
trade entry ("OLTE") system trained representative available until released 
by the Exchange staff.  All adjustments  and/or corrections, must be 
accompanied by relevant supporting documentation prior to being incorporated 
into expiration processing, in essence making the expiration processing an 
extension of the afternoon trade resolution procedures.

Exchange Clearing (299-2110) and Trade Processing (299-2465 and 299-2044) 
personnel will be available to assist with the processing of notices of 
Exercise and Abandonment, position transfers, trade corrections and other 
questions or problems you may have.

Failure by any Clearing Member or qualified Floor Trader to comply with 
procedures as outlined herein may result in severe disciplinary action by the 
Exchange and potential financial liability to customers or members for 
failure to exercise diligence in the processing of information.

TRADING FLOOR OPERATIONAL PROCEDURES

Trading in the February 2001 Copper Options Contract will cease at 2:00 P.M. 
on January 26, 2001.  All Brokers and Traders must inform their Clearing 
Members of their intentions to exercise or abandon such Options by 4:00 P.M.

On Friday, January 26, 2001, all Brokers and Clearing Members must have a 
duly authorized, On-Line Trade Entry ("OLTE") system trained representative 
available until such time as the Exchange deems necessary.

NOTE: After 4:30 P.M. all expiring option trade data must be inputted on 
special "OLTE" terminals located in the Trade Processing Room.  Any other 
means of submission will be rejected by the Exchange.  Members will be able 
to submit all other trade data until 5:00 P.M.

After the Unmatched Trade Reports and the Preliminary Spot Month Matched 
Trade Reports are displayed, Clearing Member representatives will be able to 
pick up their Preliminary Clearing Reports at the Clearing Department.

A final review of all submissions will be made.  The Supervisor of the Trade 
Processing Room will detain only those Clearing Members and/or Broker 
representatives involved.  All final corrections will be made at this time 
and upon determination of the Supervisor that all option processing is 
complete, all representatives will be released.

Exchange Reports based on Friday,s submissions and processing will be 
available on Monday morning January 29, 2001.

In the event that you have any questions regarding the foregoing trading 
floor procedures please contact Michael Campanelli at (212) 299-2072 or David 
Sherman at (212) 299-2061.

CLEARING DEPARTMENT OPERATIONAL PROCEDURES

1. OPEN POSITION CONFIRMATION ("OPC") - The OPC should reflect as accurately 
as possible all futures and options gross positions as of close-of business 
on the business day prior to expiration.  Review the estimated current gross 
positions as shown and make appropriate adjustments.  The OPC must be 
submitted not later than 9:00 A.M.

2.   OPTIONS EXERCISE/ABANDONMENT REQUESTS FORM ("E/A") - An expiring option 
with a strike price in-the-money by one tick or more will be subject to 
automatic exercise unless an Option Abandonment Request form is submitted 
advising that a Clearing Member ("CM") elects to abandon some or all of its 
position in that strike price (i.e., for the option series).  All other 
options series in the expiring month will be subject to automatic abandonment 
unless an Option Exercise Request form is submitted.  When submitting an E/A 
form, please note the following:

(a) An E/A form must be submitted not later than 5:00 PM.
(b) Do not submit an Exercise form for positions in strike prices which are 
subject to automatic
Exercise nor submit an Abandonment form for positions in strike prices which 
are subject to automatic abandonment.
(c) If a CM wishes to submit an E/A form to abandon a position in a strike 
price subject to automatic exercise or wishes to exercise a position in a 
strike price which is out of the money, it is necessary to notify Clearing by 
telephone of such anticipated action.  The CM must have an officer available 
to confirm such intention.
(d) CMs may secure from Clearing a time-stamped receipt of the CM copy to 
assure submission  of the CM,s E/A forms.

3. OPTION POSITION REDUCTION REQUEST FORM ("OPRR") - As a general rule, 
purchases and sales of option contracts are presumed to be new business.   If 
some or all of your purchases and sales are in fact undertaken for position 
liquidation purposes, OPRR forms may be submitted on the day of expiration 
and will be used in conjunction with trade data to reduce your projected 
position in an expiring contract.  OPRR requests in excess of actual traded 
volume will be rejected.  Exception: Cabinet trades and cancel correction 
trades will automatically liquidate existing positions, therefore do not 
submit an OPRR form for cabinet or cancel correction trades.
The OPRR form must be submitted not later than 5:00 PM.

4. HOUSE/CUSTOMER POSITION TRANSFER REQUEST FORM ("H/C") - H/C forms may be 
used only to transfer previously cleared contracts between a CM,s house and 
customer accounts.  Problem trades (those which have not cleared prior to 
expiration day) must be corrected using COMEX,s on-line trade entry system 
under the direct supervision of the Trade Audits Department of COMEX ("Trade 
Audits").  The H/C form must be submitted not later than 3:30 PM.

5. EX-PIT POSITION TRANSFER REQUEST FORM ("Ex-Pit") - Ex Pit forms may be 
used only to transfer previously cleared contracts between CMs.  Problem 
trades (those which have not cleared prior to expiration day) must be 
corrected on the on-line trade entry system under the direct supervision of 
Trade Audits.  The Ex-Pit form must be submitted not later than 3:30 PM.

 *****
A) At approximately 4:15 PM, two PRELIMINARY reports of the expiration 
process will be available for distribution at the NYMEX Clearing Department:
 1. OPTION EXPIRATION REPORT AND CONFIRMATION - The purpose of this report is 
to project the CM,s present position going into the expiration based upon the 
transactions which have already been submitted to Clearing.  CMs should 
review and modify their adjusted gross positions as of close-of-business on 
the business day prior to expiration.  Further adjustments may be submitted 
not later than 5:00 PM.  The projected ending gross positions will reflect 
transactions accepted or rejected for clearance on expiration night, 
inclusive of Ex-Pit, H/C and OPRR transactions which have been submitted to 
Clearing prior to 3:30 PM, and trade information submitted to COMEX prior to 
3:45 PM.  Normally, this report will also reflect manually submitted Exercise 
and Abandonment instructions, the projected number of exercises and maximum 
potential assignments for each strike price, the type of exercise (manual or 
automatic), whether the strike is In, At or Out of the money, and the 
exercise va!
lu!
e associated therewith based on settlement prices established by COMEX on the 
day of expiration.

2. TRANSACTION LISTING - This listing will include in detail all expiring 
option trades submitted to COMEX prior to 3:45 PM on expiration day, and all 
H/C, ExPit, OPRR and E/A transactions submitted to Clearing Prior to 3:30 PM.

Please note: Trade information reflected on the option expiration report and 
transaction listing are trades submitted only. To inquire whether trades have 
matched, each CM must review the trade reports provided by COMEX,s On-Line 
Trade Entry ("OLTE") system.

B) At approximately 5:30 PM, FINAL reports of the expiration process, 
including all submissions to Clearing and trade information submitted to 
COMEX made by 5:00 PM, will be available for distribution at the NYMEX 
Clearing Department.

C) At 5:45 PM, Preliminary In The Money Abandonment and Out Of The Money 
Exercise information will be announced on Fast Facts.

D) At Approximately 7:30 PM, a Final Notice of Exercise/Assignments will be 
available in each CM,s lockbox located at the NYMEX Clearing Department.  
Each CM which has exercised or been assigned one or more options will receive 
a separate statement showing exercises and/or assignments for each option 
series.  Please check this statement carefully.  Although long options 
positions in-the-money by one tick or more will be automatically exercised, 
not all short option positions will be assigned if there are any options 
manually abandoned at such strike prices.  Please note that there also may be 
some at or out-of-the money options being exercised.

E) At approximately 9:00 PM, the final set of clearing sheets will be 
available in each CM,s lockbox located at the NYMEX Clearing Department.

It is strongly recommended that each CM have a representative(s) that is 
properly trained to handle the option expiration process available beginning 
at 4:15 PM and who will receive the CM,s reports at the specific times.  It 
is solely the responsibility of the CM to review these reports and to notify 
the Clearing staff immediately of any discrepancies.

To obtain the exact time of the availability for each report, clearing 
members should call (212) 513-7405, access code 702.  The announcement time 
will occur 1/2 hour prior to availability.

Attached please find a Clearing Member Procedure Summary for ease of 
reference.  Please contact John Ramos at (212) 299-2142 (Members 001-500) or 
Mel Garcia at (212) 299-2144 (members 501-999) if you have any questions.

OPTION EXPIRATION PROCESSING CLEARING MEMBER PROCEDURE SUMMARY

Time: 3:30 PM
Activity: Expits, H/C transfers, Option Position Reduction and 
Exercise/Abandon notices
Event: Submission to Clearing cutoff time.
Notes: Final cutoff for Expits and H/C tranfers

Time: 3:45 PM
Activity: Call Fast Facts to obtain availability time of Preliminary Option 
Expiration Reports.
Event: Fast Facts notice of Availability

Time: 4:15 PM
Activity: Preliminary option expiration reports available to clearing members 
at NYMEX Clearing Department

Time: 5:00 PM
Activity: Options Position Reduction, Exercise/Abandon notices and Gross 
Position Adjustments
Event: Submission to Clearing Cutoff Time
Notes: Final cutoff for Option Position Reduction, Exercise/Abandon notices 
and Gross Position Adjustments

Time: 5:05 PM
Activity: Call Fast Facts to obtain availability time of Final Preliminary 
Option expiration Reports
Event: Fast Facts notice of Availability

Time: 5:30 PM
Activity: Final Preliminary option expiration reports available to clearing 
members at NYMEX Clearing Department.

Time: 5:45 PM
Activity: Call Fast Facts to obtain Preliminary In the Money Abandonment and 
Out of the Money Exercise Information
Event Fast Facts notice of information
Notes: New Event

Time: 6:00 PM
Activity: Corrections to previously Submitted Adjustments or Notices
Event: Correction period cutoff time (30 minutes after final preliminary 
report is distributed)
Notes: Final cutoff for corrections

Time: 7:00 PM
Activity: Call Fast Facts to obtain availability of final expiring option 
position and Exercise/Assignment report
Event: Fast Facts notice of Availability

Time: 7:30 PM
Activity: Final expirating options position and Exercise/Assignment report 
available in clearing member's lockbox at NYMEX Clearing Department

Time: 8:30 PM
Activity: Call Fast Facts to obtain availability of final clearing reports.
Event: Fast Facts notice of Availability

Time: 9:00 PM
Activity: Final clearing reports available in clearing member's lockbox at 
NYMEX Clearing Department.

Please contact John Ramos at (212) 299-2142 (Members 001-500) or Mel Garcia 
at (212) 299-2144 (members 501-999) if you have any questions.


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