Thursday, July 24, 2008

Options Trader Alert #2008 - 11
NASDAQ OMX To Complete Acquisition of Philadelphia Stock Exchange Today; Broadens the Company’s Derivatives Footprint

Please Route To:

Head Traders; Technical Contacts; Compliance Officers; Options Contacts; Vendor Admin Contacts; Vendor Tech Contacts; Buy-Side Contacts

What you need to know:

• NASDAQ OMX intends to complete its acquisition of The Philadelphia Stock Exchange today. The Philadelphia Stock Exchange will be renamed NASDAQ OMX PHLX (“PHLX”).
• The NASDAQ OMX Transaction Services U.S. group will operate PHLX and the NASDAQ Options Market as separate entities.
• NASDAQ OMX will now offer two market models under one holding company.
• There will be a market-wide call to discuss the details of the transaction and other NASDAQ OMX initiatives on Tuesday, July 29, 2008.

Who you should contact:

NASDAQ Market Sales at +1 800 846 0477

Has NASDAQ OMX completed its acquisition of PHLX?

The NASDAQ OMX Group, Inc.^SM announced that it intends to complete its acquisition of The Philadelphia Stock Exchange today, expanding The NASDAQ OMX Group’s presence in the derivatives market. The Philadelphia Stock Exchange, which will be renamed NASDAQ OMX PHLX, is the nation’s oldest stock exchange, and with this acquisition NASDAQ OMX^SM will operate the third largest options market in the U.S. NASDAQ OMX PHLX will be part of the NASDAQ Transaction Services U.S. group. It will continue as a distinct entity alongside The NASDAQ Options Market^SM, launched in March 2008. With this transaction, NASDAQ OMX Group has a combined 17% market share in the U.S. equity options market between its two market models and a much larger footprint in global derivatives.

The transaction solidifies NASDAQ OMX’s position as a major player in the U.S. options market and is a critical step forward in our transformation as a global cash equities and derivatives exchange. The Philadelphia Stock Exchange’s rich history and strong options leadership coupled with its diverse product offering, existing market share and loyal customer base is a natural fit for NASDAQ OMX.

Will NASDAQ OMX have two options markets?

Yes. NASDAQ OMX will have both The NASDAQ Options Market platform with true price/time priority and PHLX with an allocation model. This gives customers access to an options offering unsurpassed in the U.S., providing customers two market models, a robust product portfolio, price optionality, cost efficiencies and the fastest platform in the industry.

PHLX will offer customers both electronic and hybrid floor-based options trading to better address diverse customer needs. The NASDAQ Options Market will continue to operate as a separate market offering true price/time priority.

How will the combination benefit market participants?

Both NASDAQ OMX and the Philadelphia Stock Exchange are known for exchange technological innovation, which will only grow more pronounced with the combination. The two exchanges combine best practices and best of breed:

• Speed: Fastest platform in the industry with INET
• Reliability
• Transparency

The combination of NASDAQ OMX and The Philadelphia Stock Exchange will benefit market participants by offering:

• An expanded choice of services to customers — NASDAQ OMX is the only market that offers a choice of two market models under one holding company for different trading needs.
• Access to more sophisticated products and services.
• Expanded services and transaction products to PHLX customers and their firms including:
• Additional education
• New market data products
• Post-trade analytics
• NASDAQ OMX customers access to new and innovative products such as World Currency Options.

What are the details for the market-wide conference call?

NASDAQ OMX will hold a market-wide call Tuesday, July 29, 2008, beginning at 4:15 p.m., ET, to discuss PHLX, as well as other initiatives such as our upcoming acquisition of the Boston Stock Exchange, Clearing, and NASDAQ OMX Europe.

To ensure that you are not held up in the conference call queue as a result of the high call volume, please call in at least five minutes early. The call details are:

July 29, 2008, 4:15 p.m., ET
Dial In: + 1 888 639 0048
International: + 1 517 308 9281
Passcode: Marketwide
Leader: Adam Nunes

Where can I get additional information?

• Contact NASDAQ Market Sales at +1 800 846 0477
• Go to www.nasdaqtrader.com/options
• Rene Warrington, Director Service Desk, at + 1 215 496 5101

Cautionary Note Regarding Forward-Looking Statements

Information set forth in this communication contains forward-looking statements that involve a number of risks and uncertainties. NASDAQ OMX cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such forward-looking statements include, but are not limited to statements about our transaction with The Philadelphia Stock Exchange and other statements that are not historical facts. Forward-looking statements involve a number of risks, uncertainties or other factors beyond NASDAQ OMX's control. These factors include, but are not limited to, NASDAQ OMX's ability to implement its strategic initiatives, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors detailed in NASDAQ OMX's filings with the U.S. Securities Exchange Commission, including its annual report on Form 10-K for the fiscal year ending December 31, 2007 which is available on NASDAQ OMX's website at http://www.nasdaqomx.com and the SEC's website at www.sec.gov. NASDAQ OMX undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.