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  • gollywogazoo gollywogazoo Jul 3, 2009 9:47 AM Flag

    sold the wwvab's against my long position

    thanks for the input...worst case scenario, I can always purchase new shares with the premium received & allow the old stock to be called. Still it is all very clumsy and highlights the lack of transparency in some of this stuff. The option exchanges really should get their acts together and do away with these so called non standard contracts.

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    • Here is the information from the options clearing house. I can't see where the strike price is adjusted.

      Back to Infomemo Search
      DATE: SEPTEMBER 29, 2008
      SUBJECT: WENDY’S INTERNATIONAL, INC. - CONTRACT ADJUSTMENT
      OPTION SYMBOLS: WEN/WVE
      NEW SYMBOLS: JEK/WWV
      ADJUSTED SYMBOL: ZVY
      FUTURES SYMBOL: WEN1C
      NEW SYMBOL: WEN2C
      DATE: 9/30/08
      Option Contract Adjustment
      DATE: September 30, 2008
      OPTION SYMBOL: WEN changes to JEK
      WVE changes to WWV
      STRIKE PRICES: No Change
      NUMBER OF
      CONTRACTS: No Change
      MULTIPLIER 100 (e.g., a premium of 1.50 yields $150; a strike of 15 yields $1,500.00)
      NEW DELIVERABLE
      PER CONTRACT: JEK/WWV
      425 (New) Wendy’s/Arby’s Group, Inc. (“WEN”) Common Shares
      ZVY
      1)
      425 (New) Wendy’s/Arby’s Group, Inc. (“WEN”) Common Shares
      2)
      135 Tim Hortons, Inc. (“THI”) Common Shares
      3)
      $11.08 Cash
      CUSIP: WEN (New): 950587105
      THI: 88706M103
      SETTLEMENT: Regular
      PRICING
      The underlying price for JEK/WWV will be determined as follows:
      JEK = 4.25 (WEN)
      The underlying price for ZVY will be determined as follows:
      ZVY + 4.25 (WEN) + 1.35 (THI) + .1108
      Futures Contract Adjustment
      DATE: September 30, 2008
      FUTURES SYMBOL: WEN1C changes to WEN2C
      SETTLEMENT PRICES: No Change
      NUMBER OF
      CONTRACTS: No Change
      MULTIPLIER 100 (e.g., a premium of 1.50 yields $150)
      NEW DELIVERABLE
      PER CONTRACT: 425 (New) Wendy’s/Arby’s Group, Inc. (“WEN”) Common Shares
      CUSIP: WEN (New): 950587105
      THI: 88706M103
      SETTLEMENT: Regular
      PRICING
      The underlying price for WEN2C Futures contract deliverable, expressed in term of current market value, would be calculated as follows:
      WEN2C = 4.25 (WEN)
      Please note that the valuation would apply only to the WEN2C deliverable in terms of current market value of the deliverable securities. The resulting price would not be equivalent to the daily settlement price of a futures contract month, whose determination would include cost of money carrying charges, adjustment for dividends, and other factors.
      BACKGROUND
      On September 15, 2008, Shareholders of Wendy’s International, Inc. (“WEN”) voted concerning a proposed merger with Triarc Companies, Inc. (“TRY”). The merger was approved and subsequently consummated on September 29, 2008. As a result, Triarc, Companies Inc. will
      change its name to Wendy’s/Arby’s Group, Inc. (New “WEN”), and each existing WEN Common Share will be converted into the right to receive 4.25 (New) WEN Common Shares. Cash will be paid in lieu of fractional WEN shares.
      THE FOREGOING IS AN UNOFFICIAL SUMMARY OF THE TERMS OF THE MERGER, PREPARED BY OCC FOR THE CONVENIENCE OF CLEARING MEMBERS. OCC ACCEPTS NO RESPONSIBILITY FOR THE ACCURACY OR COMPLETENESS OF THE SUMMARY. CLEARING MEMBERS SHOULD REFER TO THE WEN/TRY JOINT PROXY STATEMENT PROSPECTUS DATED AUGUST 15, 2008, FOR THE AUTHORITATIVE DESCRIPTION OF THE MERGER AND ALL ITS TERMS AND CONDITIONS.
      Pursuant to Article VI, Section 11, of OCC's By-Laws, a panel of OCC's Securities Committee has determined to adjust all WEN/WVE/ZVY options as indicated above (the panel consists of two representatives from the Exchanges on which the affected option is traded (in this case, the Chicago Board Options Exchange (“CBOE”), the NASDAQ OMX PHLX (“PHLX”), the NYSE Arca Exchange (“ARCX”), the International Securities Exchange (“ISE”), and the Boston Options Exchange (“BOX”)) and the Chairman of OCC or his delegee, who only votes in case of a tie).
      Pursuant to Article XII Section 3 of OCC’s By-Laws all WEN1C futures will be adjusted as indicated above.
      CATEGORY: CONTRACT ADJUSTMENT
      SUB-CATEGORY: ANTICIPATED ADJUSTMENT
      For questions regarding this memo, call 1-888-OPTIONS or email options@theocc.com

 
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