15594 Federal Register / Vol. 69, No. 58 / Thursday, March 25, 2004 / Rules and Regulations
1 17 CFR 249.308.2 17 CFR 249.310.3 17 CFR 249.310b.4 17 CFR 249.308a.5 17 CFR 249.308b.6 17 CFR 249.12b23.7 17 CFR 249.13a10.8 17 CFR 240.13a11.9 17 CFR 240.15d10.10 17 CFR 240.15d11.11 15 U.S.C. 78a et seq.12 17 CFR 239.12.
13 17 CFR 239.13.14 17 CFR 230.144.15 15 U.S.C. 77a et seq.16 17 CFR 228.601.17 17 CFR 228.10 et seq.18 17 CFR 229.601.19 17 CFR 229.10 et seq.
20 Release No. 338106 (June 17, 2002) [67 FR 42914].
21 In addition, three additional items of the form provided for voluntary disclosure of other significant events of a company, the filing of financial statements and exhibits, and disclosure of information pursuant to Regulation FD [17 CFR 243.100 et seq.]
SECURITIES AND EXCHANGE COMMISSION
17 CFR Parts 228, 229, 230, 239, 240 and 249
[Release Nos. 338400; 3449424; File No. S72202]
Additional Form 8K Disclosure Requirements and Acceleration of Filing Date
AGENCY: Securities and Exchange Commission.ACTION: Final rule.
SUMMARY: We are expanding the number of events that are reportable on Form8K under the Securities Exchange Act of 1934. These amendments add eight new items to the form, transfer two items from the periodic reports and expand disclosures under two existing Form 8K items. Due to the increase in reportable events under the form, we are reorganizing the Form 8K items into topical categories. The amendments also shorten the Form 8K filing deadline for most items to four business days after the occurrence of an event triggering the disclosure requirements of the form. Finally, we are adopting a limited safe harbor from liability for failure to file certain of the required Form 8K reports. These amendments are responsive to the real time issuer disclosure mandate in Section 409 of the Sarbanes-Oxley Act of 2002. They are intended to provide investors with better and faster disclosure of important corporate events.EFFECTIVE DATE: August 23, 2004.FOR FURTHER INFORMATION CONTACT: Ray Be, Special Counsel, or Julie A. Bell, Special Counsel, each at (202) 9422910, Division of Corporation Finance, U.S. Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 205490312.SUPPLEMENTARY INFORMATION: We are adopting amendments to Form 8K,1 Form 10K,2 Form 10KSB,3 Form 10Q,4 Form 10QSB,5 Rule 12b23,6 Rule 13a10,7 Rule 13a11,8 Rule 15d10,9 and Rule 15d11,10 under the Securities Exchange Act of 1934,11 Form S2,12
Form S3,13 and Rule 144 14 under the Securities Act of 1933,15 and Item 601 16 of Regulation SB 17 and Item 601 18 of Regulation SK.19
Table of Contents
I. Background II. Discussion of Amendments
A. Shortened Form 8K Filing Deadline and Availability of Form 12b25
B. Reorganization of Form 8K Items C. Expansion of Form 8K Items 1. Item 1.01 Entry into a Material
Definitive Agreement a. Filing of Exhibits b. Considerations Regarding Business
Combinations 2. Item 1.02 Termination of a Material
Definitive Agreement 3. Item 1.03 Bankruptcy or Receivership 4. Item 2.01 Completion of Acquisition or
Disposition of Assets 5. Item 2.02 Results of Operations and
Financial Condition 6. Item 2.03 Creation of a Direct Financial
Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant
7. Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
8. Item 2.05 Costs Associated with Exit or Disposal Activities
9. Item 2.06 Material Impairments 10. Item 3.01 Notice of Delisting or
Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
11. Item 3.02 Unregistered Sales of Equity Securities
12. Item 3.03 Material Modifications to Rights of Security Holders
13. Item 4.01 Changes in Registrants Certifying Accountant
14. Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
15. Item 5.01 Changes in Control of Registrant
16. Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers a. Disclosure under Item 5.02(a) when a director resigns or refuses to stand for re-election due to a disagreement or is removed for cause
b. Disclosure under Item 5.02(b) when certain officers retire, resign or are terminated and disclosure when a director retires, resigns, is removed or refuses to stand for re-election for any reason other than as a result of a disagreement or for cause
c. Disclosure under Item 5.02(c) and (d) when the registrant appoints certain new officers or a new director is elected
17. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
D. Proposed Form 8K Items Not Being Adopted
E. Safe Harbor and Eligibility to Use Forms S2 and S3 and to Rely on Rule 144
F. Other Matters Related to Form 8K Filings and Conforming Amendments
1. Events Falling under Multiple Items 2. Amendments to Item 601 of Regulation
SK and Regulation SB 3. Clarification of Filing Status of Exhibits 4. Revisions to Forms 10Q, 10QSB, 10
K and 10KSB 5. Certification under Section 906 of the
Sarbanes-Oxley Act of 2002 6. Other Conforming Amendments
III. Paperwork Reduction Act IV. Costs and Benefits v. Effect on Efficiency,
Competition and Capital Formation VI. Final Regulatory Flexibility Analysis VII. Statutory Basis and Text of Rule
On June 17, 2002, we proposed to increase the number of events required to be disclosed on Form 8K.20 Form8K is the Exchange Act form for current reports. Prior to the amendments being adopted today, Form 8K required disclosure regarding nine different specified events.21 At the time, the proposals would have increased the number of reportable events under the form to 22. The proposals also would have shortened the forms filing deadline from five business days or 15 calendar days, depending on the particular event, to two business days with an automatic two business day extension upon a companys filing of a Form 12b25. In response to these proposals, we received approximately 85 comment letters from various constituencies, including investors, issuers, accounting firms, law firms and associations representing the interests of such constituencies.
Under the previous Form 8K regime, companies were required to report very few significant corporate events. The limited number of Form 8K disclosure items permitted a public company to delay disclosure of many significant events until the due date for its next periodic report. During such a delay, the market was unable to assimilate such undisclosed information into the value of a companys securities. The revisions
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15595Federal Register / Vol. 69, No. 58 / Thursday, March 25, 2004 / Rules and Regulations
22 15 U.S.C. 78m(l).23 See, for example, Exchange Act Rule 12b20
[17 CFR 240.12b20].
24 17 CFR 249.220f.25 17 CFR 249.240f.26 Instruction B.1. to Form 8K.27 See, for example, the letters from American
Institute of Certified Public Accountants (AICPA), City Bar of New York (NY City Bar), Deloitte & Touche, Dan Nguyen, Emerson Electric Co. (Emerson), Boeing Company (Boeing), Morgan Stanley and Perkins Coie.
28 See, for example, the letters from the AICPA, KPMG, Cleary Gottlieb, Steen & Hamilton (Cleary Gottlieb), PriceWaterhouseCoopers (PWC), Intel Corporation (Intel) and Ronald Stauber.
29 See the letters from Cleary Gottlieb and PWC.30 For example, if a reportable event occurred on
a Wednesday, the Form 8K filing deadline would typically be the following Tuesday.
that we adopt today will benefit markets by increasing the number of unquestionably or presumptively material events that must be disclosed currently. They will also provide investors with better and more timely disclosure of important corporate events.
On July 29, 2002, Congress enacted the Sarbanes-Oxley Act of 2002.22 Section 409 of this Act requires public companies to disclose on a rapid and current basis material information regarding changes in a companys financial condition or operations as we, by rule, determine to be necessary or useful for the protection of investors and in the public interest. These amendments also further the goals of Section 409 of the Sarbanes-Oxley Act.
At the same time, we have taken into account a number of important comments on the proposals by adopting a modified version of the proposed Form 8K amendments. We have addressed the commenters concern regarding potential premature disclosure in a number of respects. We also have addressed the concerns raised by several commenters regarding the length of the Form 8K filing period by extending it beyond the originally proposed two business day period and significantly reducing the amount of analysis required by the specific items of the form. Our general rules, however, prohibiting material omissions that make the contents of the disclosure misleading, of course, continue to apply.23 We have also taken into account the concerns expressed by commenters regarding the liabilities that could arise for failure to make current disclosure of some events in what are still tight t