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EFTA01353492

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The second full paragraph on page 2 of the Booklet is replaced with the following paragraph: Most options have standardized terms — such as the nature and amount of the underlying interest. the expiration date, the exercise price, whether the option is a call or a put, whether the option is a physical delivery option or a cash-settled option, the manner in which the cash payment and the exercise settlement value of a cash-settled option are determined, the multiplier of a cash-settled option, the exercise price setting date and exercise price setting formula of a delayed start option, the style of the option, whether the option has automatic exercise provisions. and adjustment provisions. These standardized terms are generally described in Chapter II. Each U.S. options market publishes specification sheets setting forth the particular standardized terms of the options traded on that options market. (The options mar- kets may also provide for trading in options whose terms are not all fixed in advance. Rather, subject to certain limitations, the parties to transactions in these options may designate certain of the terms. These flexibly struc- tured options are discussed in Chapter VII of this booklet) The first two paragraphs on page 7 of the Booklet are replaced with the following paragraphs: The exercise price of a cash-settled option (other than a binary option or a range option) is the base for the determination of the amount of cash, if any, that the option holder is entitled to receive upon exercise (see the discussion of "Cash Settlement Amount and Exercise Settlement Value" below). The exercise price of a binary option is the value or level of the underlying interest above, below, or. in some cases, at which the option will be in the money at expiration, thereby causing the fixed cash settlement amount to become payable (see the "Binary Option" definition below). In the case of a range option. the exercise price Is the option

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