CME Group Distributes Letter To NYMEX Class A Members

Dear NYMEX Class A Members:

We have enjoyed the opportunity to meet with a number of NYMEX members and clearing members over the past two weeks to discuss the enhancements included in our revised merger agreement. You should have received proxy materials explaining these changes.

We regret that we will not have the opportunity to meet with each of you individually prior to your August 18 special meeting. However, our discussions with your fellow members have highlighted to us the value of ensuring that you each have further insight into the potential economic impact -- both long term and short term -- of the revised transaction on your individual circumstances.

1. CME Group will maintain a price differential in favor of NYMEX members so long as CME or CBOT members have price preferences.

2. CME Group will maintain a membership market and will limit the Class A memberships to the current level of 816 memberships. We believe that limiting the number of memberships with floor access and trading and brokerage privileges, maintaining a membership fee differential and adopting a more flexible membership eligibility program should enhance the overall value of the NYMEX membership you are retaining.

3. We also believe our business plan has created significant membership value and opportunity. We have adopted member pricing policies that incentivize high volume participants and have promoted the benefits of that pricing to hedge funds, proprietary trading shops and financial institutions. Approximately 60 hedge funds and 20 proprietary trading shops have joined CME as either members or clearing members in the period following demutualization and purchased a significant number of memberships. The increased participation of these key market participants has improved and deepened the liquidity of CME's current products and benefited all users of our markets as well as increased demand for CME memberships. At the time of our demutualization, the combination of the CME membership and the embedded equity value was worth $525,000. Currently, the value of the CME membership alone is $1.2 million. While there are no guarantees, we believe this successful approach would benefit the NYMEX product set as well.

4. The $750,000 payment represents the fair value to extinguish significant membership rights, including the 311(G) rights and other trading rights and protections. This payment establishes certainty and immediacy for an economic value that is currently highly uncertain as to both its timing and its ultimate value.

5. The $750,000 payment will not extinguish the NYMEX membership. Your NYMEX membership will have rights in addition to the pricing differential. Those rights include trading floor access -- to the current trading floor facility for a number of years and to a NY-based trading floor for as long as such floor satisfies basic profitability tests, the right to sell or lease the Class A membership, account based fees for NYMEX members, the right to authorize three individuals with power of attorney to trade your account at member rates, and protections against CME moving pits from New York to Chicago over NYMEX member objections or until a significant waiting period has passed. Some of these rights and protections are specific to NYMEX members and not available to CME or CBOT members. You should note that under current tax law we would expect that in most cases you will receive capital gain or loss when you sell your Class A membership in the future. As is always the case, you should consult your tax advisor about the consequences to you of that treatment.

On a long-term strategic basis, this deal is the best option to grow and develop NYMEX markets into the future. This transaction will extend the benefits of the CME Globex technology agreement in perpetuity, and it will also allow NYMEX customers to use one point of contact from trade matching through clearing. In short, CME Group is the best partner for NYMEX. We are very excited about the prospect of adding dynamic and successful NYMEX Class A members to our trading community. -- www.cme.com