http://www.wkrg.com/weather/article_education/hole_punch_clouds/4097/

In the 2003 event, first a layer of Altocumulus clouds moved in
from the west. Even though these clouds were made of water droplets they were
actually supercooled water. In other words, the temperature of the water was
below freezing. These clouds were just below airplane condensation trails
(contrails) indicating that the humidity was high at that level of the
atmosphere. Then close to noon, within minutes, the blanket of Altocumulus
clouds developed a hole. The hole turned out to be crystals of ice, transformed
into regular Cirrus clouds, and then falling. By definition this was
precipitation and since Cirrus clouds are made of ice crystals, you could call
it snow, fallstreaks, or Virga. It evaporated well before hitting the ground.
All of this is common but what was uncommon was the perfect circular shaped that
grew within a matter of minutes.

Thanks to Ken.