OCC STRONGLY RECOMMENDS CLEARING MEMBERS CONTACT ALL HOLDERS OF EXPIRING RUG OPTIONS TO APPRISE THEM OF THE CONTENTS OF THIS MEMO.

On Tuesday, September 3, 2002, the NASDAQ NMS halted trading in Akamai Technologies, Inc. ("AKAM/RUG"). The Chicago Board Options Exchange ("CBOE") and The Philadelphia Stock Exchange ("PHLX") also halted trading in RUG options.

Effective September 3, 2002, AKAM has been trading on the NASDAQ Small-Cap Market.

RUG OPTION EXERCISE

There continues to be no OCC restriction on the exerciseof RUG put and call options, and OCC does not currently anticipate imposing such restrictions.

Settlement of RUG option exercise/assignment activity continues to take place through National Security Clearing Corporation ("NSCC"). Clearing Members' obligations to deliver AKAM stock to NSCC, and the consequences of any failure to deliver, will be governed by the rules of NSCC.

RUG EXPIRATION EXERCISE PROCEDURES

January series of RUG options expire January 18, 2003. OCC has determined to use a closing price obtained from the NASDAQ Small-Cap Market in this weekend's expiration processing, assuming such prices continue to be available. OCC anticipates expiring RUG options will be processed in the normal fashion this weekend, including the use of the customary in-the-money thresholds to effect exercise of expiring, RUG positions.

CUSTOMER EXERCISE INSTRUCTIONS

Clearing Members are reminded that exercise thresholds are employed by OCC in expiration processing solely as an operational convenience, as described in interpretation .02 to OCC Rule 805(d): "The exercise thresholds provided for in Rule 805(d) and elsewhere in the rules are part of the administrative procedure established by the Corporation to expedite its processing of exercise of expiring options by Clearing Members, and are not intended to dictate to Clearing Members which positions in customer's accounts should or must be exercised."

Clearing Members should remind customers of their obligations to submit exercise instructions before expiration, as described in the Options Disclosure Document "Characteristics and Risks of Standardized Options", p. 50:

"An option holder who intends to exercise an option before expiration must give exercise instructions to his brokerage firm before the firm's cut-off time for accepting exercise instructions on the last trading day before expiration. Many brokerage firms accept standing instructions to exercise, or have procedures for the exercise of, every option, which is in the money by a specified amount at expiration. These procedures often incorporate by reference OCC's administrative procedures that provide for the exercise of every option that is in the money by a specified amount at expiration unless the Clearing Firm carrying the option in its accounts instructs OCC not to exercise the option. Investors should determine from their brokerage firm the applicable cut-off times, the firm's procedures for submitting exercise instructions, and whether any of their options are subject to automatic exercise. Investors should also determine whether the exercise of their options is subject to standing instructions of their brokerage firm, and, if so, they should discuss with the firm the potential consequences of such instructions."

The CBOE and PHLX have advised OCC Exchange Rules governing the submission of exercise notices will continue to apply in the normal fashion on January 17, 2003.

CATEGORY: OPERATIONS

SUB-CATEGORY: TRADING HALT