A vote to approve the settlement between the Chicago Board Options Exchange (CBOE) and Chicago Board of Trade members over exercise right privileges has been postponed by CBOE.
With its stock down more than 50% from its December highs, CME Group didn’t need any more bad news but a letter from the Chairman’s office of CBOE to its members announcing a postponement of the planned July 17 membership vote on the proposed settlement appeared to further damage CME stock.
The stock had recovered to positive territory shortly before the letter was made public but dropped more than $5 in the last hour of trading Thursday.
Here is the text of the letter:
To: CBOE Membership
From: Office of the Chairman
Date: July 3, 2008
Subject: Postponement of Member Vote on Settlement Agreement
The membership vote to approve the proposed settlement of the Exercise Right Litigation, which was tentatively scheduled for July 17, has been postponed. As you know, we believe that the proposed settlement agreement represents a fair and reasonable offer to settle the appeal of the SEC order and the Delaware exercise right litigation. Representatives of the plaintiff class and counsel for the parties are currently working to complete the terms of the proposed agreement. We will inform you of the revised date of the vote once the definitive agreement has been completed.
