HKEx: Arrangements For Adjustment Of China Resources Enterprise Futures And Options

Hong Kong Exchanges and Clearing Limited (HKEx) has announced the arrangements for the adjustment to the contract terms of all open China Resources Enterprise (CRE) Futures and Options contracts in existence after the market close on 13 December 2006, the business day immediately before the ex-dividend day of 14 December 2006, to account for CRE's proposed special dividend of $1.00 per share.

Highlights of the adjustment arrangements to CRE Futures and Options contracts are attached below. Investors should consult their brokers for further details, or if they have any questions regarding the adjustment.

CRE Futures

After the market close on 13 December 2006:

1)	The adjusted exercise prices (AEP) will be obtained by the following formula and rounded to nearest two decimal places:
	Exercise Prices of outstanding CRE Options Contracts x [(S - 1.00) / (S)]
	where S is the share closing price of CRE on the business day prior to the Ex-dividend Date, $1.00 is the special dividend announced on 29 November 2006 .
2)	An adjusted contract multiplier will be obtained by the following formula and rounded to the nearest four decimal places:
	Exercise Prices of outstanding CRE Options Contracts x 2,000 / AEP
	where the Contract Size of standard CRE Options Contracts is 2,000 shares.

Trading symbols:

1)	The adjusted CRE Options contracts (adjusted contracts) will be traded under the temporary trading symbol CRA and there will be one contract month - December 2006 - available for trading until expiration. From 14 December 2006 , no new series under CRA will be listed.
2)	The only available contract month for CRE Options contracts with the original contract multiplier of 2,000 shares (standard contracts), under the original trading symbol CRE, will be December 2006. No new series under CRE will be listed.
	Details of CRE and CRA Options contracts available for trading from 14 December 2006 are in the table below.

Class Symbol	Availability For Trading		Addition of New Options Contracts on and after 14 December 2006	Information Pages
Class Symbol	14 December 2006 to 28 December 2006	From 29 December 2006 Onwards		Information Pages
CRE(Standard)	Yes	No	No	3027/3028
CRA(Adjusted)	Yes	No	No	3147/3148

Note: HKEx announced on 8 June 2006 that trading in CRE Options would be gradually discontinued.

Open positions:

After the market close on 13 December 2006, open positions in CRE Options contracts will be transferred to the respective adjusted CRA Options contracts. It should be noted that only contract sizes and exercise prices are being adjusted; there will not be any changes to the number of open positions and contract months for existing CRE Options contracts whatsoever after the adjustment. All such open contracts will be traded and settled under the adjusted contract terms from 14 December 2006 onwards.