Tools

A  A  A     

Contract Adjustments

Research Circular #RS00-342

May 4, 2000

Terayon Communication Systems, Inc. ("TERN/TUN/YGT/TXF") 2-for-1 Stock Split Ex-Distribution Date: May 8, 2000

Terayon Communication Systems, Inc. ("TERN/TUN/YGT/TXF") has announced a 2-for-1 common stock split, with a payable date of May 5, 2000, to shareholders of record April 25, 2000. The ex-date for the stock split is Monday, May 8, 2000.

Contract Adjustment

Pursuant to OCC rules (Article VI, Section 11), all outstanding TUN/YGT/TXF option series will be adjusted to reflect this 2-for-1 stock split on Monday, May 8, 2000, at 8:30 A.M. Chicago time. The OCC will issue one additional contract for each open contract on the ex-date. Also on the ex-date, each TUN/YGT/TXF series will have an adjusted exercise price equal to one-half of the exercise price rounded to the nearest 1/8 of a point for each TUN/YGT/TXF series existing on the business day immediately prior to the ex-date. The option symbol will remain the same. Adjusted exercise prices are shown below. [Any FLEX series that may exist will be adjusted in a similar manner to the standardized option.]

The option adjustment will appear in the Daily Position Report of the clearing member firms on the ex-date. After 8:30 A.M. Monday, May 8, 2000, all trades, corrections, and exercises must be submitted to the CBOE and OCC on an adjusted basis.

Adjusted Exercise Prices

On Monday, May 8, 2000, the ex-distribution date, trading in TUN/YGT/TXF series will be on an adjusted basis. At 8:30 A.M., Chicago time, an opening rotation will be effected with the following adjustments:

 
EXISTING SERIES				ADJUSTED SERIES*			
100 Shares				100 Shares			
MONTH/STRIKE	CALLS	PUTS		MONTH/STRIKE	CALLS	PUTS
								
May	45    	TUNEI	TUNQI	->	May	22 1/2	TUNER	TUNQR
May	50    	TUNEJ	TUNQJ	->	May	25    	TUNEE	TUNQE
May	55    	TUNEK	TUNQK	->	May	27 1/2	TUNES	TUNQS
May	60    	TUNEL	TUNQL	->	May	30    	TUNEF	TUNQF
May	65    	TUNEM	TUNQM	->	May	32 1/2	TUNET	TUNQT
May	70    	TUNEN	TUNQN	->	May	35    	TUNEG	TUNQG
May	75    	TUNEO	TUNQO	->	May	37 1/2	TUNEU	TUNQU
May	80    	TUNEP	TUNQP	->	May	40    	TUNEH	TUNQH
May	85    	TUNEQ	TUNQQ	->	May	42 1/2	TUNEV	TUNQV
May	90    	TUNER	TUNQR	->	May	45    	TUNEI	TUNQI
May	95    	TUNES	TUNQS	->	May	47 1/2	TUNEW	TUNQW
May	100    	TUNET	TUNQT	->	May	50    	TUNEJ	TUNQJ
May	105    	TUNEA	TUNQA	->	May	52 1/2	TUNEX	TUNQX
May	110    	TUNEB	TUNQB	->	May	55    	TUNEK	TUNQK
May	115    	TUNEC	TUNQC	->	May	57 1/2	TUNEY	TUNQY
May	120    	TUNED	TUNQD	->	May	60    	TUNEL	TUNQL
May	125    	TUNEE	TUNQE	->	May	62 1/2	TUNEZ	TUNQZ
								
May	130    	YGTEF	YGTQF	->	May	65    	YGTEM	YGTQM
May	135    	YGTEG	YGTQG	->	May	67 1/2	YGTEU	YGTQU
May	140    	YGTEH	YGTQH	->	May	70    	YGTEN	YGTQN
May	145    	YGTEI	YGTQI	->	May	72 1/2	YGTEV	YGTQV
May	150    	YGTEJ	YGTQJ	->	May	75    	YGTEO	YGTQO
May	155    	YGTEK	YGTQK	->	May	77 1/2	YGTEW	YGTQW
May	160    	YGTEL	YGTQL	->	May	80    	YGTEP	YGTQP
May	165    	YGTEM	YGTQM	->	May	82 1/2	YGTEX	YGTQX
May	170    	YGTEN	YGTQN	->	May	85    	YGTEQ	YGTQQ
May	175    	YGTEO	YGTQO	->	May	87 1/2	YGTEY	YGTQY
May	180    	YGTEP	YGTQP	->	May	90    	YGTER	YGTQR
May	185    	YGTEQ	YGTQQ	->	May	92 1/2	YGTEZ	YGTQZ
May	190    	YGTER	YGTQR	->	May	95    	YGTES	YGTQS
May	195    	YGTES	YGTQS	->	May	97 1/2	YGTEL	YGTQL
May	200    	YGTET	YGTQT	->	May	100    	YGTET	YGTQT
May	210    	YGTEB	YGTQB	->	May	105    	YGTEA	YGTQA
May	220    	YGTED	YGTQD	->	May	110    	YGTEB	YGTQB
May	230    	YGTEA	YGTQA	->	May	115    	YGTEC	YGTQC
May	240    	YGTEC	YGTQC	->	May	120    	YGTED	YGTQD
May	250    	YGTEE	YGTQE	->	May	125    	YGTEE	YGTQE
May	260    	YGTEU	YGTQU	->	May	130    	YGTEF	YGTQF
May	270    	YGTEV	YGTQV	->	May	135    	YGTEG	YGTQG
May	280    	YGTEW	YGTQW	->	May	140    	YGTEH	YGTQH
May	290    	YGTEX	YGTQX	->	May	145    	YGTEI	YGTQI
May	300    	YGTEY	YGTQY	->	May	150    	YGTEJ	YGTQJ
								
Jun	60    	TUNFL	TUNRL	->	Jun	30    	TUNFF	TUNRF
Jun	65    	TUNFM	TUNRM	->	Jun	32 1/2	TUNFT	TUNRT
Jun	70    	TUNFN	TUNRN	->	Jun	35    	TUNFG	TUNRG
Jun	75    	TUNFO	TUNRO	->	Jun	37 1/2	TUNFU	TUNRU
Jun	80    	TUNFP	TUNRP	->	Jun	40    	TUNFH	TUNRH
Jun	85    	TUNFQ	TUNRQ	->	Jun	42 1/2	TUNFV	TUNRV
Jun	90    	TUNFR	TUNRR	->	Jun	45    	TUNFI	TUNRI
Jun	95    	TUNFS	TUNRS	->	Jun	47 1/2	TUNFW	TUNRW
Jun	100    	TUNFT	TUNRT	->	Jun	50    	TUNFJ	TUNRJ
Jun	105    	TUNFA	TUNRA	->	Jun	52 1/2	TUNFX	TUNRX
Jun	110    	TUNFB	TUNRB	->	Jun	55    	TUNFK	TUNRK
Jun	115    	TUNFC	TUNRC	->	Jun	57 1/2	TUNFY	TUNRY
Jun	120    	TUNFD	TUNRD	->	Jun	60    	TUNFL	TUNRL
Jun	125    	TUNFE	TUNRE	->	Jun	62 1/2	TUNFZ	TUNRZ
								
Jun	130    	YTGFF	YTGRF	->	Jun	65    	YTGFM	YTGRM
Jun	135    	YTGFG	YTGRG	->	Jun	67 1/2	YTGFU	YTGRU
Jun	140    	YTGFH	YTGRH	->	Jun	70    	YTGFN	YTGRN
Jun	145    	YTGFI	YTGRI	->	Jun	72 1/2	YTGFV	YTGRV
Jun	150    	YTGFJ	YTGRJ	->	Jun	75    	YTGFO	YTGRO
Jun	155    	YTGFK	YTGRK	->	Jun	77 1/2	YTGFW	YTGRW
Jun	160    	YTGFL	YTGRL	->	Jun	80    	YTGFP	YTGRP
Jun	165    	YTGFM	YTGRM	->	Jun	82 1/2	YTGFX	YTGRX
Jun	170    	YTGFN	YTGRN	->	Jun	85    	YTGFQ	YTGRQ
Jun	175    	YTGFO	YTGRO	->	Jun	87 1/2	YTGFY	YTGRY
Jun	180    	YTGFP	YTGRP	->	Jun	90    	YTGFR	YTGRR
Jun	185    	YTGFQ	YTGRQ	->	Jun	92 1/2	YTGFZ	YTGRZ
Jun	190    	YTGFR	YTGRR	->	Jun	95    	YTGFS	YTGRS
Jun	195    	YTGFS	YTGRS	->	Jun	97 1/2	YTGFL	YTGRL
Jun	200    	YTGFT	YTGRT	->	Jun	100    	YTGFT	YTGRT
								
Jul	45    	TUNGI	TUNSI	->	Jul	22 1/2	TUNGR	TUNSR
Jul	50    	TUNGJ	TUNSJ	->	Jul	25    	TUNGE	TUNSE
Jul	55    	TUNGK	TUNSK	->	Jul	27 1/2	TUNGS	TUNSS
Jul	60    	TUNGL	TUNSL	->	Jul	30    	TUNGF	TUNSF
Jul	65    	TUNGM	TUNSM	->	Jul	32 1/2	TUNGT	TUNST
Jul	70    	TUNGN	TUNSN	->	Jul	35    	TUNGG	TUNSG
Jul	75    	TUNGO	TUNSO	->	Jul	37 1/2	TUNGU	TUNSU
Jul	80    	TUNGP	TUNSP	->	Jul	40    	TUNGH	TUNSH
Jul	85    	TUNGQ	TUNSQ	->	Jul	42 1/2	TUNGV	TUNSV
Jul	90    	TUNGR	TUNSR	->	Jul	45    	TUNGI	TUNSI
Jul	95    	TUNGS	TUNSS	->	Jul	47 1/2	TUNGW	TUNSW
Jul	100    	TUNGT	TUNST	->	Jul	50    	TUNGJ	TUNSJ
Jul	105    	TUNGA	TUNSA	->	Jul	52 1/2	TUNGX	TUNSX
Jul	110    	TUNGB	TUNSB	->	Jul	55    	TUNGK	TUNSK
Jul	115    	TUNGC	TUNSC	->	Jul	57 1/2	TUNGY	TUNSY
Jul	120    	TUNGD	TUNSD	->	Jul	60    	TUNGL	TUNSL
Jul	125    	TUNGE	TUNSE	->	Jul	62 1/2	TUNGZ	TUNSZ
								
Jul	130    	YGTGF	YGTSF	->	Jul	65    	YGTGM	YGTSM
Jul	135    	YGTGG	YGTSG	->	Jul	67 1/2	YGTGU	YGTSU
Jul	140    	YGTGH	YGTSH	->	Jul	70    	YGTGN	YGTSN
Jul	145    	YGTGI	YGTSI	->	Jul	72 1/2	YGTGV	YGTSV
Jul	150    	YGTGJ	YGTSJ	->	Jul	75    	YGTGO	YGTSO
Jul	155    	YGTGK	YGTSK	->	Jul	77 1/2	YGTGW	YGTSW
Jul	160    	YGTGL	YGTSL	->	Jul	80    	YGTGP	YGTSP
Jul	165    	YGTGM	YGTSM	->	Jul	82 1/2	YGTGX	YGTSX
Jul	170    	YGTGN	YGTSN	->	Jul	85    	YGTGQ	YGTSQ
Jul	175    	YGTGO	YGTSO	->	Jul	87 1/2	YGTGY	YGTSY
Jul	180    	YGTGP	YGTSP	->	Jul	90    	YGTGR	YGTSR
Jul	185    	YGTGQ	YGTSQ	->	Jul	92 1/2	YGTGZ	YGTSZ
Jul	190    	YGTGR	YGTSR	->	Jul	95    	YGTGS	YGTSS
Jul	195    	YGTGS	YGTSS	->	Jul	97 1/2	YGTGL	YGTSL
Jul	200    	YGTGT	YGTST	->	Jul	100    	YGTGT	YGTST
Jul	210    	YGTGB	YGTSB	->	Jul	105    	YGTGA	YGTSA
Jul	220    	YGTGD	YGTSD	->	Jul	110    	YGTGB	YGTSB
Jul	230    	YGTGA	YGTSA	->	Jul	115    	YGTGC	YGTSC
Jul	240    	YGTGC	YGTSC	->	Jul	120    	YGTGD	YGTSD
Jul	250    	YGTGE	YGTSE	->	Jul	125    	YGTGE	YGTSE
Jul	260    	YGTGU	YGTSU	->	Jul	130    	YGTGF	YGTSF
Jul	270    	YGTGV	YGTSV	->	Jul	135    	YGTGG	YGTSG
Jul	280    	YGTGW	YGTSW	->	Jul	140    	YGTGH	YGTSH
Jul	290    	YGTGX	YGTSX	->	Jul	145    	YGTGI	YGTSI
Jul	300    	YGTGY	YGTSY	->	Jul	150    	YGTGJ	YGTSJ
								
Jul	310    	TXFGB	TXFSB	->	Jul	155    	TXFGK	TXFSK
Jul	320    	TXFGD	TXFSD	->	Jul	160    	TXFGL	TXFSL
								
Oct	45    	TUNJI	TUNVI	->	Oct	22 1/2	TUNJR	TUNVR
Oct	50    	TUNJJ	TUNVJ	->	Oct	25    	TUNJE	TUNVE
Oct	55    	TUNJK	TUNVK	->	Oct	27 1/2	TUNJS	TUNVS
Oct	60    	TUNJL	TUNVL	->	Oct	30    	TUNJF	TUNVF
Oct	65    	TUNJM	TUNVM	->	Oct	32 1/2	TUNJT	TUNVT
Oct	70    	TUNJN	TUNVN	->	Oct	35    	TUNJG	TUNVG
Oct	75    	TUNJO	TUNVO	->	Oct	37 1/2	TUNJU	TUNVU
Oct	80    	TUNJP	TUNVP	->	Oct	40    	TUNJH	TUNVH
Oct	85    	TUNJQ	TUNVQ	->	Oct	42 1/2	TUNJV	TUNVV
Oct	90    	TUNJR	TUNVR	->	Oct	45    	TUNJI	TUNVI
Oct	95    	TUNJS	TUNVS	->	Oct	47 1/2	TUNJW	TUNVW
Oct	100    	TUNJT	TUNVT	->	Oct	50    	TUNJJ	TUNVJ
Oct	105    	TUNJA	TUNVA	->	Oct	52 1/2	TUNJX	TUNVX
Oct	110    	TUNJB	TUNVB	->	Oct	55    	TUNJK	TUNVK
Oct	115    	TUNJC	TUNVC	->	Oct	57 1/2	TUNJY	TUNVY
Oct	120    	TUNJD	TUNVD	->	Oct	60    	TUNJL	TUNVL
Oct	125    	TUNJE	TUNVE	->	Oct	62 1/2	TUNJZ	TUNVZ
								
Oct	130    	YGTJF	YGTVF	->	Oct	65    	YGTJM	YGTVM
Oct	135    	YGTJG	YGTVG	->	Oct	67 1/2	YGTJU	YGTVU
Oct	140    	YGTJH	YGTVH	->	Oct	70    	YGTJN	YGTVN
Oct	145    	YGTJI	YGTVI	->	Oct	72 1/2	YGTJV	YGTVV
Oct	150    	YGTJJ	YGTVJ	->	Oct	75    	YGTJO	YGTVO
Oct	155    	YGTJK	YGTVK	->	Oct	77 1/2	YGTJW	YGTVW
Oct	160    	YGTJL	YGTVL	->	Oct	80    	YGTJP	YGTVP
Oct	165    	YGTJM	YGTVM	->	Oct	82 1/2	YGTJX	YGTVX
Oct	170    	YGTJN	YGTVN	->	Oct	85    	YGTJQ	YGTVQ
Oct	175    	YGTJO	YGTVO	->	Oct	87 1/2	YGTJY	YGTVY
Oct	180    	YGTJP	YGTVP	->	Oct	90    	YGTJR	YGTVR
Oct	185    	YGTJQ	YGTVQ	->	Oct	92 1/2	YGTJZ	YGTVZ
Oct	190    	YGTJR	YGTVR	->	Oct	95    	YGTJS	YGTVS
Oct	195    	YGTJS	YGTVS	->	Oct	97 1/2	YGTJL	YGTVL
Oct	200    	YGTJT	YGTVT	->	Oct	100    	YGTJT	YGTVT
Oct	210    	YGTJB	YGTVB	->	Oct	105    	YGTJA	YGTVA
Oct	220    	YGTJD	YGTVD	->	Oct	110    	YGTJB	YGTVB
Oct	230    	YGTJA	YGTVA	->	Oct	115    	YGTJC	YGTVC
Oct	240    	YGTJC	YGTVC	->	Oct	120    	YGTJD	YGTVD
Oct	250    	YGTJE	YGTVE	->	Oct	125    	YGTJE	YGTVE
Oct	260    	YGTJU	YGTVU	->	Oct	130    	YGTJF	YGTVF
Oct	270    	YGTJV	YGTVV	->	Oct	135    	YGTJG	YGTVG
Oct	280    	YGTJW	YGTVW	->	Oct	140    	YGTJH	YGTVH
Oct	290    	YGTJX	YGTVX	->	Oct	145    	YGTJI	YGTVI
Oct	300    	YGTJY	YGTVY	->	Oct	150    	YGTJJ	YGTVJ
								
Oct	310    	TXFJB	TXFVB	->	Oct	155    	TXFJK	TXFVK
Oct	320    	TXFJD	TXFVD	->	Oct	160    	TXFJL	TXFVL
Any additional TUN/YGT/TXF series that are added prior to the ex-date will also be adjusted in the manner described above.

The following series have non-standard strikes and price symbols with respect to the OPRA exercise price symbol format:

TUN					
R (22-1/2)	S (27-1/2)	T (32-1/2)	U (37-1/2)
V (42-1/2)	W (47-1/2)	X (52-1/2)	Y (57-1/2)
Z (62-1/2)			
					
YGT					
U (67-1/2)	V (72-1/2)	W (77-1/2)	X (82-1/2)
Y (87-1/2)	Z (92-1/2)	L (97-1/2)					
IMPORTANT -Order Entry After Adjustment

Please note that at the time of the adjustment, the strike prices of all TUN/YGT/TXF options will be reduced by one-half, and OCC will issue one additional contract for each open contract on the ex-date. At 8:30 A.M., Chicago time, on Monday, May 8, 2000, all outstanding TUN May 45 options will become May 22 1/2 options, and TUN May 90 options will become May 45 options. Any TUN May 45 positions opened prior to the ex-date that are closed out on or after the ex-date must be closed out as May 22 1/2 options. Negligence in this matter could lead customers to establish new positions in the May 45 options rather than closing out then-existing positions in the May 22 1/2 options.

TUN/YGT strikes that will be affected by the adjustment in the manner described above are included in the table below. Members should be aware of the potential for confusion respecting any of the related pairs of strikes shown below, and should be cautious in this regard.

Existing -> Adjusted	&	Existing -> Adjusted		
45    	->	22 1/2		90    	->	45    
50    	->	25    		100    	->	50    
55    	->	27 1/2		110    	->	55    
60    	->	30    		120    	->	60    
130    	->	65    		260    	->	130    
135    	->	67 1/2		270    	->	135    
140    	->	70    		280    	->	140    
145    	->	72 1/2		290    	->	145    
150    	->	75    		300    	->	150    
GTC Order Conversion

On Friday, May 5, 2000, immediately after the CBOE close, the system will convert or cancel all resting orders in the TUN/YGT/TXF order book. If your firm has requested, all EBook orders (phone, wire, and electronic) and all ORS orders residing outside the book (booth or crowd routed) will be converted reflecting the adjustments. If your firm has requested, all EBook orders and ORS orders residing outside of the book will be canceled. If your firm receives EBook CXL drops, the CXL confirms will print at your booth at 3:15 p.m. ORS CXLs will also be transmitted electronically to your branches.

Immediately after the close, the book staff will return a final written report listing the orders that are converted or canceled to all firms. If converted, this list will also show how the new orders will be adjusted. This report will be available on request anytime during the day prior to the night of the adjustment. Position and Exercise Limits

The CBOE Department of Market Regulation has determined that: "The position and exercise limits following this stock split will be any combination of TUN, YGT, and TXF on the same side of the market not to exceed 150,000 through October 21, 2000. Following the October 2000 expiration, the position and exercise limits will revert to the standard limit of 75,000 contracts."

Questions regarding this memo can be addressed to the CBOE Investor Services Department at 1-800-OPTIONS (1-800-678-4667) press 3, then 3. This and all other CBOE contract adjustment research circulars can be accessed from the CBOE Web site here.

CBOE Volatility Index (VIX)