T he United States Securities and Exchange deadline for most items - - PDF document

Corporate Finance Alert

March 2004

SEC Adds Eight New Disclosure Items to Form 8-K, Expands Existing Disclosure Items and Shortens the Form 8-K Filing Deadline to Four Business Days

By Peter H. Ehrenberg, Esq., Steven M. Skolnick, Esq. and Douglas N. Bernstein, Esq.

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he United States Securities and Exchange Commission (the “SEC”) has approved the adoption of final rules that:

·

create eight new disclosure items to Form 8-K;

·

expand two existing Form 8-K disclosure items;

·

transfer two disclosure items that previously were required to be included in annual and quarterly reports; and

·

shorten the Form 8-K filing deadline to four (4) business days. As a result of the addition of new disclosure items to Form 8-K, the SEC has reorganized the reportable items into eight topical categories (one of which is reserved for later use). As a result, companies will need to review the new categories to ensure that they are complying with the new numbering.

Effective Date

The new requirements will become effective on August 23, 2004. The new requirements are applicable to all domestic issuers, including small business issuers and issuers that are not accelerated filers.

Accelerated Filing Deadline

The new rules require companies to file required current reports on Form 8-K within four business days

• f a reportable event. Under previous rules, the filing

deadline for most items was five business days or 15 calendar days, depending on the nature of the event. The new four business day rule does not apply to voluntary 8-K disclosures, disclosures made pursuant to Regulation FD and certain 8-K exhibits.

Eight New Form 8-K Disclosure Items

New Item 1.01 – Entry into a Material Definitive Agreement New Item 1.01 requires the disclosure of material definitive agreements1 that are not entered into in the ordinary course of business. Under Item 1.01, an issuer must also disclose any material amendment to a material definitive agreement (including material amendments after August 23, 2004 to material agreements entered into before August 23, 2004). Companies must understand that if they enter into a material amendment to a material agreement not previously disclosed, they will need to disclose the amendment. An issuer must disclose the following information upon entry into, or a material amendment of, a material definitive agreement:

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1 Companies should review Item 601(b)(10) of Regulation S-K when

determining whether or not an agreement is material. The new rules do not require disclosure of letters of intent or other non-binding agreements, except in the unusual circumstances where a binding provision in such a document is, in itself, material.

·

the date on which the agreement was entered into or amended (as applicable);

·

the identity of the parties to the agreement;

·

a brief description of any material relationship between the issuer and/or its affiliates and any

• ther parties to the agreement; and

·

a brief description of the terms of the agreement or amendment that are material to the issuer. Although the SEC encourages companies to file the agreement as an exhibit with the Form 8-K when feasible, the new rules do not require companies to file such exhibits until the filing of their next Annual Report on Form 10-K or Quarterly Report on Form 10-Q. Notably, the SEC has maintained a separate category for consummation of acquisitions or dispositions of assets (formerly Item 2 and now Item 2.01 of Form 8-K). Many companies will use Item 1.01 when entering into an agreement to acquire or dispose of assets and then disclose the closing of the transaction under Item 2.01 if such transaction meets the Item 2.01 thresholds. New Item 1.02 – Termination of a Material Definitive Agreement New Item 1.02 requires disclosure if a material definitive agreement not made in the ordinary course

• f business is terminated other than by expiration or

completion if such termination is material to the

• issuer. In such instances, the issuer must disclose:

·

the date on which the agreement was terminated;

·

the identity of the parties to the agreement;

·

a brief description of any material relationship between the issuer and/or its affiliates and any

• f the parties to the agreement;

·

a brief description of the terms of the agreement that are material to the issuer;

·

a brief description

• f

the material circumstances surrounding the termination; and

·

any material early termination penalties incurred by the issuer. New Item 2.03 – Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement New Item 2.03 requires the disclosure of the following information if the issuer becomes

• bligated under a direct financial obligation2 that is

material to the issuer:

·

the date on which the issuer becomes

• bligated on the direct financial obligation;

·

a brief description of the transaction or agreement creating the obligation;

·

a brief description of other terms or conditions that are material to the issuer; and

·

a brief description of the nature and amount

• f the obligation, including the material terms

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2 This Item defines a “direct financial obligation” as any of the

following:

·

a long-term direct obligation, as defined in Item 303(a)(5)(ii)(A) of Regulation S-K;

·

a capital lease obligation, as defined in Item 303(a)(5)(ii)(B)

• f Regulation S-K;

·

an operating lease obligation, as defined in Item 303(a)(5)(ii)(C) of Regulation S-K; or

·

a short-term (generally less than one year) debt obligation that arises other than in the ordinary course of business.

under which it may become a direct

• bligation (if applicable) or may be

accelerated or increased and the nature of any recourse provisions that would enable the issuer to recover from third parties. In addition, if the issuer becomes directly or contingently liable for an obligation that is material to the issuer arising from an off-balance sheet arrangement, it must provide the following additional information:

·

the date on which the issuer becomes directly or contingently liable on the

• bligation;

·

a brief description of the transaction or agreement creating the obligation;

·

a brief description of the nature and amount

• f the obligation, including the material

terms under which it may become a direct

• bligation (if applicable) or may be

accelerated or increased and the nature of any recourse provisions that would enable the issuer to recover from third parties;

·

the maximum potential amount of future payments (undiscounted) that the issuer may be required to make (if different); and

·

a brief description of other terms or conditions that are material to the issuer. Issuers must understand the interplay between Item 2.03 and Item 2.04. Issuers will be required to file an 8-K under Item 2.03 at the time they become contingently liable for an obligation arising out of an off-balance sheet arrangement if the liability is material to the issuer, and would be required to file a Form 8-K under Item 2.04 if such contingent liability becomes a direct financial obligation of the issuer. New Item 2.04 – Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off- Balance Sheet Arrangement New Item 2.04 requires an issuer to file a Form 8-K if a triggering event causing the increase or acceleration of a direct financial obligation3 of the issuer occurs and the consequences of the event are material to the issuer. In such instances, the issuer must disclose:

·

the date of the event;

·

a brief description of the transaction or agreement under which the direct financial

• bligation was created and is increased or

accelerated;

·

a brief description of the triggering event;

·

the amount of the direct financial obligation, as increased if applicable, and the terms of payment or acceleration that apply; and

·

any other material obligations of the issuer that may arise, increase, be accelerated or become direct financial obligations as a result

• f the triggering event or the increase or

acceleration of the direct financial obligation. In addition, if a triggering event occurs causing the issuer’s obligation under an off-balance sheet arrangement to increase or be accelerated, or causing an issuer’s contingent obligation under an

• ff-balance sheet arrangement to become a direct

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3 New Item 2.04 defines “direct financial obligation” by reference to

the definition in Item 2.03 (see footnote 2) but adds that for the purposes of Item 2.04 such term includes an obligation arising out of an off-balance sheet arrangement that is accrued under FASB Statement of Financial Accounting Standards No. 5, Accounting for Contingencies, as a probable loss contingency.

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financial obligation of the issuer, and the consequences of the event are material to the issuer, the issuer must also disclose the following:

·

the date of the event;

·

a brief description of the off-balance sheet arrangement;

·

a brief description of the triggering event4;

·

the nature and amount of the obligation, as increased if applicable, and the terms of payment or acceleration that apply; and

·

any other material obligations of the issuer that may arise, increase, be accelerated or become direct financial obligations as a result

• f the triggering event or the increase or

acceleration of the obligation under the off- balance sheet arrangement or its becoming a direct financial obligation of the issuer. Although the SEC is not requiring disclosure of management’s analysis of the effect of the triggering event on the issuer, the disclosure made in the Form 8-K “must include all other material information, if any, that is necessary to make the required disclosure, in the light

• f

the circumstances under which it is made, not misleading.” New Item 2.05 – Costs Associated with Exit or Disposal Activities New Item 2.05 requires disclosure when the board of directors, a committee of the board of directors, or an authorized officer or officers if board action is not required, commits the issuer to an exit or disposal plan or otherwise disposes of a long-lived asset or terminates employees under a plan of termination described in paragraph 8 of SFAS 146, Accounting for Costs Associates with Exit

• r Disposal Activity, under which material charges

will be incurred under generally accepted accounting principals applicable to the issuer. An issuer must disclose:

·

the date of the commitment to the course of action;

·

a description of the course of action, including the facts and circumstances leading to the expected action and the expected completion date;

·

for each major type of cost associated with the course of action (for example, one-time termination benefits, contract termination costs and other associated costs), an estimate

• f the total amount or range of amounts

expected to be incurred in connection with the action;

·

an estimate of the total amount or range of amounts expected to be incurred in connection with the action; and

·

the issuer’s estimate of the amount or range of amounts of the charge that will result in future cash expenditures. If the issuer is unable to make a good faith estimate of the amount of the charges, it need not disclose an estimate at the time of filing, but must nevertheless file the Form 8-K report describing the issuer’s commitment to a course of action under which it will incur a material charge. However, when the issuer formulates an estimate, it must amend the previous Form 8-K to include the estimate within four business days after formulating

4 A “triggering event” is defined as an event, including an event of

default, event of acceleration or similar event, as a result of which a “direct financial obligation” of the issuer or an obligation of the issuer arising under an off-balance sheet arrangement is increased or becomes accelerated or as a result of which a contingent obligation

• f the issuer arising out of an off-balance sheet arrangement becomes

a direct financial obligation of the issuer.

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the estimate. Although many commentators noted that it is difficult to determine the exact date of triggering event, the SEC has focused on the term commitment as the action triggering the filing

• requirement. The SEC has also noted that it

revised the disclosure requirements to more closely track the disclosure requirements of SFAS No. 146. Additionally, the SEC is not requiring management’s analysis of the effects of the events, but again provides that the disclosure cannot be misleading. New Item 2.06 – Material Impairments New Item 2.06 requires disclosure when the board of directors, a committee of the board of directors, or an authorized officer or officers if board action is not required, concludes that a material charge for impairment to one or more of its assets, including without limitation an impairment of securities or goodwill, is required under generally accepted accounting principals applicable to the issuer. An issuer must disclose:

·

the date of the conclusion that a material charge is required;

·

a description of the impaired asset(s) and the facts and circumstances leading to the conclusion that the charge for impairment is required;

·

its estimate of the amount or range of the amounts of the impairment charge; and

·

its estimate of the amount or range of amounts of the impairment charge that will result in future expenditures. An instruction to Item 2.06 provides that no Form 8-K disclosure is required if the conclusion regarding the material charge is made in connection with the preparation, review or audit of financial statements at the end of a fiscal quarter or year and the plan is disclosed in the issuer’s Exchange Act report for that period. New Item 3.01 – Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing New Item 3.01(a) requires an issuer to report its receipt of a notice from the national securities exchange or national securities association that maintains the principal listing for any class of the issuer’s common equity, indicating that (i) the issuer or such class of its securities does not satisfy a rule or standard for continued listing5; (ii) the exchange has submitted an application to the SEC to delist such class of the issuer’s securities; or (iii) the association has taken all necessary steps under its rules to delist the security from its automated inter-dealer quotation system.6 An issuer that receives this type of a notice must disclose the following information:

·

the date that it received the notice;

·

the rule or standard for continued listing on the national securities exchange or national securities association that the issuer fails, or has failed, to satisfy; and

·

any action or response that, at the time of filing, the issuer has determined to take in

5 The SEC noted that an “early warning notice” that merely informs

an issuer that it is in danger of falling out of compliance with a rule

• r standard for continued listing does not trigger this requirement.

However, the issuer will be required to file under Item 3.01 if the notice informs the issuer that it is out of compliance but will not be delisted if it cures the problem within a specified time period.

6 This Item does not apply to issuers whose securities are quoted

exclusively on automated inter-dealer quotation systems, such as the OTCBB and The Electronic Pink Sheets.

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response to the notice. New Item 3.01(b) provides that if an issuer has notified the national securities exchange or national securities association that maintains the issuer’s principal listing for any class of the issuer’s common equity that the issuer is aware of any material noncompliance with a rule or standard for continued listing that the issuer must also provide the disclosure required by Item 3.01(a) above. Disclosure will be required under Items 3.01(a) and 3.01(b) even if the issuer has the benefit of a grace period or similar extension period during which it may cure the deficiency. New Item 3.01(c) provides that if a national securities exchange

• r

national securities association that maintains the issuer’s principal listing for any class of the issuer’s common equity issues a public reprimand letter or similar communication (in lieu of suspension or delisting) indicating that the issuer has violated a rule or standard of the exchange or association, the issuer must disclose the date and summarize the contents

• f the letter or communication.

New Item 3.01(d) provides that if an issuer has taken definitive action to cause the listing of a class

• f its common equity to be withdrawn from a

national securities exchange or terminated from a national securities association, where such exchange or association maintains the principal listing for such class of securities, the issuer must disclose the date of and describe the action taken. The SEC has stated that because of the short filing deadline, the issuer only needs to identify its anticipated action or response as of the date of filing the Form 8-K. In addition, the rules do not require the filing of the actual written notice received from the exchange or association as an exhibit to the Form 8-K. Under the new rules, an Item 3.01 filing will be required upon receipt of the first notice that the issuer does not comply with a listing rule or standard and also upon receipt of a notice of the actual delisting of the securities. New Item 4.02 – Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review New Item 4.02(a) requires an issuer to file a Form 8-K if and when its board of directors, a committee of the board of directors, or an authorized officer or officers if board action is not required, concludes that any of the issuer’s previously issued financial statements no longer should be relied upon because of an error in such financial statements. This Item requires disclosure

• f:

·

the date of the conclusion of the non- reliance;

·

the financial statements and years or periods covered;

·

a brief description of the facts underlying the conclusion to the extent known at the time of the 8-K filing; and

·

whether or not the audit committee (or the board in the absence of such a committee) or an authorized officer or officers, discussed the subject matter giving rise to the conclusion with the issuer’s independent accountant. New Item 4.02(b) provides that if the issuer is advised by its independent accountants that disclosure should be made or action should be taken to prevent future reliance on a previously issued audit report or completed interim review

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related to previously issued financial statements, the issuer must disclose:

·

the date on which it was so advised or notified;

·

the financial statements that should no longer be relied upon;

·

a brief description of the information provided by the accountant; and

·

whether or not the audit committee (or the board in the absence of such a committee) or an authorized officer or officers, discussed the subject matter giving rise to the conclusion with the issuer’s independent accountant. Under New Item 4.02(b), the issuer must simultaneously provide a copy of the disclosure to its independent accountant and request that the independent accountant furnish the issuer with a letter addressed to the SEC, as promptly as possible, stating whether or not the accountant agrees with the statements included in the Form 8-K. Within two business days of the issuer’s receipt of such letter, the issuer must file such letter as an exhibit to an amended Form 8-K.

Two Disclosure Items Transferred From Periodic Reports to Form 8-K

Item 3.02 – Unregistered Sales of Equity Securities Item 3.02 requires disclosure of information regarding the issuer’s sale of equity securities in a transaction that is not registered under the Securities Act. The required information is specified in paragraphs (a) and (c) through (e) of Item 7.01 of Regulation S-K and is currently required in Item 2(c) of Forms 10-Q and 10-QSB and Item 5(a) of Forms 10-K and 10-KSB. No Form 8-K need be filed if the equity sold in the aggregate since the last report filed under this Item

• r last periodic report (whichever is most recent)

constitute less than 1% (5% in the case of small business issuers) of the issuer’s outstanding securities of that class. Issuances not reported on Form 8-K under this exception will continue to be required to be reported in periodic reports. The requirement to file a Form 8-K under Item 3.02 is triggered when the issuer enters into an agreement to sell equity securities that is enforceable against it, regardless of conditions to

• closing. If no such agreement exists, the triggering

event is the closing of the transaction. In addition, equity securities issued upon exercise or conversion are covered by Item 3.02. Item 3.03 – Material Modifications to Rights Security Holders Item 3.03 is substantially similar to previously required Items 2(a) and (b) of Forms 10-Q and 10-

• QSB. This Item requires an issuer to disclose

material modifications to the rights of the holders

• f any class of the issuer’s registered securities and

to briefly describe the general effect of such modifications.

Expansion of Two Existing 8-K Items

Item 5.02 – Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers When a director resigns or refuses to stand for re-election due to a disagreement or is removed for cause Item 5.02(a) expands the disclosure requirements of former Item 6 of Form 8-K. The

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former item required disclosure only if a director departed as a result of a disagreement, provided a letter to the issuer describing the disagreement and then requested that such letter be publicly

• disclosed. The revised Item provides that if a

director resigned or refused to stand for re-election since the date of the last annual meeting as a result

• f a disagreement with the issuer, known to an

executive officer of the issuer, on any matter relating to the issuer’s operations, polices or practices, or if a director has been removed for cause, the issuer must disclose:

·

the date of the resignation, refusal to stand for re-election or removal;

·

any positions held by such director on any committees of the board on the above date; and

·

a brief description of the circumstances representing the disagreement that management believes caused, in whole or in part, the director’s resignation, refusal to stand for re-election or removal. If the director furnishes the issuer with any written correspondence, the issuer must file a copy

• f such correspondence as an exhibit to the Form

8-K whether or not the director so requests. The issuer must provide the director with the filed disclosures no later than the filing date and provide the director with an opportunity to reply (and file any reply as an amendment to the previously filed Form 8-K within two business days of receipt of such reply). When certain officers retire, resign or are terminated and when a director resigns or refuses to stand for re- election for any reason other than as a result of a disagreement or for cause Under Item 5.02(b), issuers are required to disclose the retirement, resignation or termination

• f any principal executive officer, president,

principal financial officer, principal accounting

• fficer, principal operating officer or any person

performing similar functions. This item also requires disclosure when a director resigns, is removed or refuses to stand for re-election for a reason other than those covered by Item 5.02(a). The only disclosure required in these instances is disclosure of the date of occurrence; no disclosure regarding the reason is required. When certain new officers are appointed or a new director is elected Item 5.02(c) requires disclosure when an issuer appoints a new principal executive officer, president, principal financial officer, principal accounting officer, principal operating officer or any person performing similar functions. The issuer must disclose:

·

the officer’s name and position;

·

the date of the appointment;

·

information regarding the background of the

• fficer and certain related transactions with

the issuer7; and

·

a brief description of the material terms of any employment agreement. The above disclosure may be delayed beyond the general four business day rule until the day the issuer first makes a public announcement of the appointment if the issuer intends to make a public

7 Item 5.02(c) requires disclosure of the information required by

Items 401(b), 401(d), 401(e) and 404(a) of Regulation S-K or the similar sections of Regulation S-B. As a result, issuers will need to

• btain this information on a timely basis and should obtain a director

and officer questionnaire from such officer prior to the appointment

• f such officer.

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announcement of the appointment other than by means of a Form 8-K. Item 5.02(d) provides that if a new director is elected to the board, other than by the shareholders at an annual or special meeting called for that purpose, the issuer must disclose:

·

the director’s name;

·

the election date;

·

a brief description of any arrangement or understanding pursuant to which the new director was selected as a director, any committees to which the new director has been, or at the time of the disclosure is expected to be named; and

·

information regarding certain related transactions with the issuer8. The instructions to Item 5.02 provide that to the extent that information required to be disclosed with respect to an employment agreement of a new executive officer or the board committees or related party information associated with a new director is not available at the time of disclosure, the issuer must include a statement to that effect in the filing and then must file an amendment to the Form 8-K containing that information within four business days after the information is determined or becomes available. Item 5.03 – Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year Item 5.03 requires issuers with a class of securities registered under Section 12 of the Exchange Act to disclose any amendment to its articles of incorporation or bylaws if the issuer did not propose the amendment in a previously filed proxy statement or information statement. Issuers are required to disclose:

·

the effective date of the amendment;

·

a description of the provision adopted or changed by amendment; and

·

if applicable, the previous provision. Item 5.03 also provides that if an issuer changes its fiscal year by means other than through solicitation of proxies or an amendment to its articles of incorporation or bylaws, the issuer must disclose:

·

the date of the determination;

·

the date of the new fiscal year; and

·

the form on which the report covering the transition period will be filed. Issuers are only required to file the text of the amendment as an exhibit to the Form 8-K and are not required to file the actual amendment or restatement with the Form 8-K; provided, that such amendment or restatement is filed as an exhibit to the next periodic report. In addition, Item 5.03 is not applicable to debt issuers that do not have equity securities registered under Section 12 of the Exchange Act.

8 Item 5.02(d) requires disclosure of the information required by Item

404(a) of Regulation S-K or the similar section of Regulation S-B. As a result, issuers will need to obtain this information on a timely basis and should obtain a director and officer questionnaire from such director prior to the appointment of such director.

9 The SEC did not adopt a proposed safe harbor from liability under

Exchange Act Sections 13(a) and 15(d). Accordingly, an issuer that fails to file a Form 8-K in a timely manner may be liable for violating Section 13(a) or 15(d).

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Limited Safe Harbor

The SEC has adopted a new limited safe harbor from public and private claims under Section 10(b) of the Exchange Act and Rule 10b-5 for failure to timely file a Form 8-K regarding the following items 9:

·

Item 1.01 – Entry into a Material Definitive Agreement

·

Item 1.02

–

Termination of a Material Definitive Agreement

·

Item 2.03 – Creation of a Direct Financial Obligation or an Obligation under an Off- Balance Sheet Arrangement

·

Item 2.04

–

Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off- Balance Sheet Arrangement

·

Item 2.05 – Costs Associated with Exit or Disposal Activities

·

Item 2.06 – Material Impairments

·

Item 4.02(a) – Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review (but only in the case where a company makes the determination and does not receive a notice described in Item 4.02(b) from it accountant). The safe harbor for the Items above states that a failure to file a report on Form 8-K that is required solely pursuant to these enumerated provisions of Form 8-K shall not be deemed a violation of Section 10(b) and Rule 10b-5 under the Exchange

• Act. The safe harbor only applies to a failure to

report on Form 8-K. As a result, material misstatements or omissions in a Form 8-K will continue to be subject to Section 10(b) and Rule 10b-5 liability. Public companies should note the negative inference that results from this safe harbor. Plaintiff’s lawyers can be expected to take the position that the late filings under the other provisions of Form 8-K give rise to liability under Section 10(b) and Rule 10b-5. Notwithstanding the safe harbor, if an issuer has a duty to disclose information that is the subject of any of the Form 8-K items for any reason apart from the Form 8-K requirement, it will not be protected from Section 10(b) and Rule 10b-5 liability that may arise from the issuer’s failure to satisfy such separate disclosure obligations.10 Moreover, the SEC is amending Forms 10-Q, 10- QSB, 10-K and 10-KSB to provide that the new safe harbor extends only until the due date of the periodic report for the relevant period in which the Form 8-K was not timely filed. If an issuer fails to include the required disclosure in the periodic report, it will be subject to potential liability under Section 10(b) and Rule 10b-5, as well as Section 13(a) or 15(d).

Eligibility to Use Forms S-2 and S-3 and Rely on Rule 144

Forms S-2 and S-3 The SEC is revising the Form S-2 and S-3 eligibility requirements to provide that issuers that fail to file timely reports required under Items 1.01, 1.02, 2.03, 2.04, 2.05, 2.06 and 4.02(a) (the Items covered by the safe harbor) will not lose their eligibility to use Form S-2 and S-3 registration statements so long as the issuer is current in its

10 By way of example, the SEC noted that if a public company sells or

repurchases its own securities while in possession of material non- public information that is required to be disclosed in a Form 8-K pursuant to an item that is covered by the safe harbor, the safe harbor will not protect the company from Section 10(b) and Rule 10b-5 liability regarding its separate disclosure obligation pursuant to the

• ffering of securities.

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Form 8-K filings with respect to those Items at the actual time of the filing of Form S-2 or S-3. Rule 144 The rules also amends Rule 144 under the Securities Act to provide that an issuer’s failure to timely file a Form 8-K will not negate eligibility to use Rule 144 to sell the company’s securities.

906 Certification

The SEC has clarified its position with respect to personal certifications given under Section 906 of the Sarbanes-Oxley Act of 2002. Even when an 8- K filing contains financials statements, the SEC will not expect a 906 certification.

Conclusion

The new Form 8-K filing requirements place a premium on speed; issuers and their counsel are expected to recognize the need for an 8-K filing and effect that filing within four business days of an event. Issuers are urged to review the new filing requirements, especially the instructions to each new item, which contain clarification and guidance, and to discuss the new requirements with their counsel. For more information about the new SEC rules, or

• ther corporate government disclosure measures, please

contact Peter H. Ehrenberg, Esq., Member of the Firm and Chairman of Lowenstein Sandler’s Corporate Department and M&A and Corporate Finance Practice Group; Steven M. Skolnick, Esq., a Member

• f the Firm and a member of the Firm’s Corporate

Department and M&A and Corporate Finance Practice Group; Douglas N. Bernstein, counsel and a member of the Firm’s Corporate Department and M&A and Corporate Finance Practice Group; or any

• ther member of the Firm’s M&A and Corporate

Finance Practice Group at (973) 597-2500.

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Section 1. Registrant’s Business and Operations

Item 1.01 Entry into a Material Definitive Agreement (New) Item 1.02 Termination of a Material Definitive Agreement (New) Item 1.03 Bankruptcy or Receivership (Old Item 3)

Section 2. Financial Information

Item 2.01 Completion of Acquisition or Disposition of Assets (Old Item 2) Item 2.02 Results of Operations and Financial Condition (Old Item 12) Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant (New) Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation

• r an Obligation under an Off-Balance

Sheet Arrangement (New) Item 2.05 Costs Associated with Exit or Disposal Activities (New) Item 2.06 Material Impairments (New)

Section 3. Securities and Trading Markets

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing (New) Item 3.02 Unregistered Sales of Equity Securities (Old Item 2(c) of Form 10-Q and 10- QSB and Item 5(a) of Form 10-K and 10-KSB) Item 3.03 Material Modifications to Rights of Security Holders (Old Items 2(a) and (b) of Forms 10-Q and 10-QSB)

Section 4. Matters Related to Accountants and Financial Statements

Item 4.01 Changes in Registrant’s Certifying Accountant (Old Item 4) Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review (New)

Section 5. Corporate Governance and Management

Item 5.01 Changes in Control of Registrant (Old Item 1) Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers (New) Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year (New) Item 5.04 Temporary Suspension of Trading Under registrant’s Employee Benefit Plans (Old Item 11)

Section 6. [Reserved] Section 7. Regulation FD

Item 7.01 Regulation FD Disclosure (Old Item 9)

Section 8. Other Events

Item 8.01 Other Events (Old Item 5)

Section 9. Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits

APPENDIX

The amendments organize the Form 8-K items under the following section headings and with the following new numbering system: