|
Release No. 33-6049 Release No. 34-15691 April 3, 1979
SIMPLIFIED REGISTRATION AND REPORTING REQUIREMENTS FOR SMALL ISSUERS
ACTION:
Adoption of amendments to forms, schedules, guides and rules.SUMMARY:
The Commission announces the adoption as an experiment of a simplified form,
available to certain domestic or Canadian corporate issuers, provided such
issuers are not subject to the Commissions continuous reporting requirements,
for the registration of securities to be sold to the public for cash not
exceeding an aggregate offering price of $5 million. The form calls for
narrative disclosure somewhat less extensive than Form S-1 and audited financial
statements substantially similar in content to those required by Regulation A.
Amendments to Commission organizational and procedural rules provide for
optional Regional Office filing and processing of this form. In addition, the
Commission is adopting amendments which allow issuers utilizing the form to
include narrative and financial information substantially similar to that called
for by the form in, their initial annual report filed with the Commission.
EFFECTIVE DATE: Upon publication in the Federal Register.
FOR FURTHER INFORMATION CONTACT: Paul A. Belvin or Douglas S. Perry
(202/755-1705), Office of Disclosure Policy and Proceedings, Division of
Corporation Finance, Securities and Exchange Commission, 500 North Capitol
Street, Washington, D.C. 20549.
SUPPLEMENTARY INFORMATION: The Securities and Exchange Commission announces the
adoption of Form S-18 and publishes an amendment to Guide 23, Current Financial
Statements and Related Data, of the Guides for Preparation and Filing of
Registration Statements, under the Securities Act of 1933 (the "Securities Act")
15 U.S.C. 77a et seq., as amended by Pub. L. No. 94-29 (June 4, 1975) and the
adoption of amendments to General Instructions and Instructions As to Financial
Statements of Form 10-K 17 CFR 249.310 under the Securities Exchange Act of 1934
(the "Exchange Act") 15 U.S.C. 77a et seq., as amended by Pub. L. No. 94-29
(June 4, 1975). Form 10-K is used for annual reports to the Commission pursuant
to Section 13 or 15(d) of the Exchange Act where no other form is prescribed. In
order to provide for the processing of Form S-18 registration statements in the
Commissions Regional Offices or at the headquarters office in Washington, D.C.
at the option of the registrant, the Commission also has amended two of its
general organizational rules, one of its procedural rules, and two rules under
the Securities Act.
Form S-18
calls for narrative disclosure somewhat less extensive than Form S-1; however,
the items which are included in Form S-18 are generally consistent with
corresponding items in Form S-1. Form S-18 will also allow issuers to file, as
part of the registration statement, audited financial statements for two fiscal
years instead of the three fiscal required in Form S-1. Furthermore, issuers may
prepare Form S-18 financial statements in accordance with generally accepted
accounting principles and practices ("GAAP") rather than Regulation S-X (17 CFR
210.1-01 to 210.12-43). In addition, the amendment to Form 10-K also allows
certain issuers who have had a public offering registered on Form S-18 to
furnish narrative and financial information substantially in accordance with
that provided in their offering on Form S-18 in their Form 10-K report for the
fiscal year in which the registration statement on Form S-18 was declared
effective.
The
simplified registration and reporting requirements adopted herein are in the
nature of an experiment. The Commission will monitor closely the use of Form
S-18 for an appropriate period to determine whether the form has functioned as
an effective means for small issuers to raise limited amounts of capital through
a registered public offering consistent with the protection of investors. After
such period the Commission will decide whether the form should be retained and,
if so, whether the conditions for its availability should be revised.
BACKGROUND
The study
of the problems confronting small businesses, while a topic of longstanding
interest, has recently become the focus of considerable public attention. The
wealth of concern for the well-being of that sector stems from the pivotal role
it plays in the vitality of the general economy. The contribution of small
businesses in supplying jobs, technical innovation, and generally in keeping our
system competitive requires that unnecessary obstacles to their formation and
growth be removed.
In
Securities Act Release No. 5914 (March 6, 1978) 43 FR 10876 the Commission
announced its intent to hold public hearings regarding the effects of its rules
and regulations on the ability of small businesses to raise capital and the
impact on small businesses of the disclosure requirements under the Securities
Acts. The hearings were prompted in part by the Commissions concern that small
businesses appear to be increasingly unable to raise funds in the public capital
markets. Also, the Report of the Advisory Committee on Corporate Disclosure
cited a number of factors which suggest that a reduction in reporting under the
Securities Acts for small businesses might be warranted. The Advisory Committee
recognized that further study was necessary and recommended that the Commission
hold public hearings.
1
A total of
21 days of hearings was held in Washington, Los Angeles, Denver, Atlanta,
Chicago, and Boston. A diversified group of 170 witnesses appeared at the
hearings, resulting in a hearing record of approximately 4,500 pages. In
addition, the Commission received 55 written comments. A summary of the record
of the proceeding is available for public inspection at the Commissions Public
Reference Section,
2 1100 L Street, N.W., Washington, D.C. 20549,
(202) 523-5360.
As stated
by the Commission in originally announcing the public hearings, it recognizes
that the small business problem is exceedingly complex. In fact, commentators at
the hearings stressed that a number of factors unrelated to the Federal
securities laws, such as tax policy, a depressed securities market, and the
state securities laws, are the significant factors affecting the ability of
small businesses to raise capital. Notwithstanding the Commissions agreement
that many factors have a more significant impact on small business capital
formation than the Federal securities laws, the Commission is engaged in an
ongoing effort to assist small business and, consequently, has undertaken a
number of rule amendments and proposals which are responsive to concerns
expressed at the small business hearings. In Securities Act Release No. 5977
(September 11, 1978) 43 FR 41383, the Commission adopted an amendment to
Regulation A 17 CFR 230.251-264 to increase the aggregate offering price of
securities which may be sold thereunder during a twelve month period from
$500,000 to $1,500,000. This amendment followed Congressional action raising the
aggregate amount of the small offering exemption specified in section 3(b).
3 The Commission, in Securities Act Release No. 5997 (November 16, 1978)
43 FR 55254, proposed an amendment to Regulation A to permit the use of a
preliminary offering circular prior to the commencement of certain
firm-commitment under-written offerings thereunder. In Securities Act Release
No. 5975 (September 8, 1978) 43 FR 41193, the Commission adopted an amendment to
Rule 146 17 CFR 230.146, the private-placement exemptive rule, which modifies
the disclosure requirements when an offering does not exceed $1,500,000 to allow
disclosure of information prescribed by Schedule I of Regulation A. The
Commission also amended Rule 144 17 CFR 230.144, the rule which sets forth
guidelines for the resale of certain securities, and proposed amendments to that
rule. Securities Act Release No. 5979 (September 19, 1978) 43 FR 43709 amends
Rule 144 to (1) relax the limitations on the amount of securities that can be
sold under the rule; (2) permit sales under the rule directly to market makers;
and (3) eliminate the brokerage or market maker transaction requirement with
respect to sales of securities by estates and beneficiaries thereof who are not
affiliates of the issuer of the securities.
4 Securities Act Release
No. 6032 (March 5, 1979) 44 FR 15610 further amended Rule 144 to permit
non-affiliates, who have been non-affiliates for a period of at least three
months, to disregard the volume limitation provisions of Rule 144 after a period
of (1) three years, if the securities to be sold are those of a class which is
either listed on an exchange or quoted on NASDAQ, or (2) four years, if the
securities to be sold are those of an issuer which files periodic reports under
section 13 or 15(d) of the Exchange Act in accordance with paragraph (c)(1) of
Rule 144. 5 In addition to the actions already taken, the Commission
is engaged in an ongoing review of additional amendments and new rules intended
to facilitate capital formation by small businesses consistent with the
protection of investors. The Commission also is attempting to formulate periodic
reporting requirements for small businesses which are more effective and less
burdensome.
In a
companion release to the announcement of the small business hearings, the
Commission proposed Form S-18 and corresponding amendments to the Form 10-K
financial statements and authorized the publication of a proposed amendment to
Guide 23. 6 Under those proposals, a corporation which is not subject
to the Commissions continuous reporting requirements and is not an investment
company, a mining company for which Form S-3 (17 CFR 239.13) is available, or a
company offering limited partnership interests in oil or gas properties, might
make a registered public offering on Form S-18 of up to $3 million utilizing two
year audited financial statements prepared in accordance with GAAP. In addition,
since section 15(d) under the Exchange Act would require a Form 10-K report
containing audited financial statements prepared in accordance with Regulation
S-X as of the end of the fiscal year during which the Securities Act
registration became effective, the proposals provide limited relief by allowing
the inclusion in that initial annual report of two year audited financials
prepared in accordance with GAAP. Thereafter, if the issuer remains subject to
section 15(d), or becomes subject to section 12, it would be required to file
periodic reports under the Exchange Act subject to the general requirements
applicable to all reporting companies.
The
rationale behind these proposals and the amendments adopted today is that an
issuer not subject to the reporting requirements of the Commission at the time
the registration statement is filed under the Securities Act may, consistent
with the protection of investors, raise a limited amount of capital without
immediately incurring the full range of disclosure and reporting requirements
imposed upon other issuers. These procedures are intended to facilitate the
process by which a small business, over a period of time, might raise a limited
amount of capital publicly and then come into full compliance with the periodic
reporting requirements imposed upon other issuers, thereby gaining a broader
access to the capital markets without being impeded by the immediate burdens
confronting many small, non-reporting issuer.
7
The
Commission received substantial comment at its public hearings and by written
comment which strongly endorsed Form S-18 and its related proposals as an
appropriate procedure for reducing the burdens of registration and reporting for
small businesses. Based upon this comment and upon its own experience, the
Commission has determined to adopt Form S-18 and the proposed amendments to Form
10-K and to publish the amendment to Guide 23 substantially as proposed. In
addition, the Commission, responding to comments received at the hearings, has
determined to provide for the filing and processing of Form S-18 registration
statements in the appropriate Regional Office of the Commission or in
Washington, D.C. at the election of the registrant. A discussion of the
amendments adopted, including changes from the original proposals, and the
significant public comment received is set forth below.
Synopsis
The
following brief synopsis is intended to assist interested parties in their
understanding of the amendments adopted. Attention is directed to the attached
text for a more complete understanding.
Form S-18
A. Availability Form S-18,
as proposed, would have been available to any domestic or Canadian corporate
issuer which is not subject to the reporting provisions of the Exchange Act and
is not a company offering limited partnership interests in an oil and gas
program or fractional undivided interests in oil and gas properties, an
investment company, or a mining company for which Form S-3 is available, for the
registration of securities which are to be sold to the public for an aggregate
offering price not exceeding $3 million.
Numerous
commentators recommended that Form S-18 be made available to all issuers,
including non-corporate entities. It was suggested that Form S-18 should give
all issuers the opportunity and encouragement to elect registration. At this
time, however, the Commission has determined to retain the restrictions on
availability substantially as proposed. Form S-18 was designed to facilitate the
entry of small businesses into the public capital markets. As indicated in
Securities Act Release No. 5915, Form S-18 is in the nature of an experiment
which represents a departure from traditional disclosure concepts. Consequently,
the Commission believes it should be monitored for an appropriate period. In the
future, the Commission will review the use of the Form to determine whether its
availability should be broadened.
Consistent
with this decision, General Instruction A(a) retains its proposed restrictions
on availability but has been amended in the following respects to clarify its
intent: 1) paragraph A(a)(3) specifically excludes the sale on Form S-18 of any
form of limited partnership interests; 2) paragraph A(a)(5) specifically
excludes from the use of the Form any corporation which has or intends to have
significant oil and gas related operations; 3) paragraph A(a)(6) specifically
excludes from the use of the Form any corporation which has or intends to have
significant mining operations; 4) paragraph A(a)(7) specifically excludes from
the use of the Form any insurance company which is exempt from the reporting
requirements of the Exchange Act in reliance upon Section 12(g)(2)(G) thereof;
and 5) paragraph A(a)8 excludes from the use of the Form any majority-owned
subsidiary of an issuer which does not meet the qualifications for use of the
Form.
B. Offering Limit The
majority of commentators at the small business hearings stated that the proposed
$3 million offering limit on Form S-18 would not be sufficiently high to make
the use of the Form economically attractive to issuers and underwriters.
Consequently, General Instruction A(a) has been amended to provide for an
offering limit of $5 million. The Commission may amend the offering ceiling in
the future as it deems appropriate.
In order
to prevent a circumvention of the $5 million ceiling for an offering on Form
S-18, the Rule as to the Use of the Form also provides that the aggregate
offering price of certain other securities of the issuer shall be included in
computing the ceiling. These include any securities of the issuer which have
been sold within twelve months prior to the commencement of a Form S-18 offering
and which were sold either: (1) in violation of section 5(a) of the Securities
Act or (2) pursuant to a registration statement previously filed on Form S-18.
In a manner similar to Rule 254 (17 CFR 230.254) under Regulation A, the
proposed Rule as to Use of Form S-18 also defines the term "securities of the
issuer" to include securities issued by any predecessor of the issuer or by any
affiliate of the issuer which was organized or became such an affiliate within
the past two years.
In certain
instances, an issuer might not desire to utilize Form S-18 to raise the maximum
$5 million allowed by the Form. In order to make available the benefits of the
Form to those issuers, paragraph A(d) of the Rule as to Use of Form S-18
provides that registrants who have had a prior offering on Form S-18 may use the
Form during the same fiscal year in which the prior offering was made to raise
the remaining balance of the offering limit.
8 In addition, a
registrant as to whom the duty to file under Section 15(d) of the 1934 Act is
suspended may then reuse Form S-18 subject to the offering limit calculations
specified in General Instruction A(c).
9 The issuer, of course, must
meet the remaining criteria of the Rule As to Use at the time of the subsequent
registration.
Secondary Sales As
proposed, Form S-18 would have been available only for sales by the issuer and
could not be used for secondary sales by selling shareholders. The Commission
specifically requested comment as to whether, in view of the primary purpose of
the Form to facilitate the formulation of capital by small business, secondary
offerings should be permitted under the Form. Commentators at the hearings
generally favored the use of Form S-18 for resales, noting that such use of the
Form would increase the investment liquidity for insiders, affiliates, and
public stockholders, and thereby release funds for reinvestment in new small
businesses. Also, it was stated that underwriters often demand that more shares
be sold than the issuer can justify, and that, in such situations, the
unavailability of Form S-18 for resales might preclude its use.
The
Commission agrees that the availability of Form S-18 for secondary sales in
certain situations is desirable. Accordingly, General Instructions A(a) and (b)
now provide that resales of securities on Form S-18 may be made for up to $1.5
million. The amount offered by selling shareholders is to be included in the
overall $5 million offering ceiling of Form S-18. Pursuant to General
Instruction A(d), secondary sales pursuant to Form S-18 may be made either in
conjunction with an offering by the issuer or as a separate offering.
D. Narrative Disclosure The
narrative disclosure called for by Form S-18 contains fewer disclosure items
than required by Form S-1. The items which are included in Form S-18, however,
are generally consistent with corresponding items in Form S-1. Except as noted
below, the adopted disclosure items generally are as proposed in Securities Act
Release No. 5915.
1. Description of Business. The
suggestion was made in the comment letters that Form S-18 should reference Item
I, Description of Business, of Regulation S-K 17 CFR 220.20. The Regulation S-K
item, however, was not designed specifically to elicit disclosure about the
business of small issuers. Item 6 of Form S-18 has therefore been amended in a
manner consistent with the approach recommended by the Advisory Committee on
Corporate Disclosure
10 and is intended to require only the
information which would normally be applicable to those small businesses
expected to utilize the Form. The Commission believes that the new item will be
less burdensome and provide more flexibility to the issuer than the item
originally proposed.
2. Remuneration of Directors and Officers.
Commentators criticized the $20,000 remuneration floor of proposed Item 9 as too
low. In view of the potential inconsistency with the issuers initial Form 10-K
and the fact that aggregate remuneration information will be provided, the floor
in new Item 10, Remuneration of Directors and Officers, is $50,000, consistent
with the recently adopted Form S-K item.
In order
to avoid complex regulations which bear little relevance to the small businesses
expected to use Form S-18, the Commission has decided not to adopt commentator
suggestions to directly reference the remuneration item to Item 4 of Regulation
S-K. New Item 10 is intended to elicit the remuneration information pertinent to
the operations of a small business, while avoiding many of the more specific
instructions and notes which are necessary in Regulation S-K to cover the
spectrum of situations presented by larger companies.
3. Projections. The
importance of projections and other forward looking information in the sale of
small business securities was stressed at the hearings. Although the
Commissions proposed safe harbor rule for projections does not extend to
non-reporting companies,
11 it is anticipated that issuers utilizing
Form S-18 in many cases will want to include projections in the registration
statement. Consequently, general instruction E(c) has been amended to refer to
Guide 62, Projections of Future Economic Performance.
12
4. Capital Structure. It was
noted at the hearings that the omission of a capital structure item would not
result in any significant savings to issuers but might deprive investors of
potentially important pro forma information. In order to ensure that such
information is included when appropriate, new Item 5, Capital Structure, calls
for capitalization information if the offering would result in a material change
in the registrants capital structure.
5. Options to Purchase Securities. Former
Item 10 would have required the issuer to name each person who holds an option,
warrant, or right to purchase securities of the issuer. This requirement was
described by commentators as too broad and unduly burdensome in light of the
limited benefit to be derived by listing option holders who are not affiliates,
directors, or highly compensated officers of the issuer, or other persons having
some material relationship to the issuer. Consequently, Item 11 has been amended
to call for options disclosure only with respect to officers, directors,
affiliates, and promoters.
6. Interest of Management and Others in Certain Transactions. The floor
for disclosure of the interests of management and others in certain transactions
was criticized by commentators as too low. It was noted that the reduction of
the materiality standard for "certain transactions" from the $40,000 level in
Form S-1 to a $20,000 level in Form S-18 neither seems mandated by the Form S-18
dollar ceiling nor advisable as an exception from the well established norms in
other filings. The Commission concurs with these comments and has made two
changes in new Item 13. First, the materiality standard for disclosure of the
"certain transactions" has been raised to $40,000. Second, in order to maintain
the stated purpose of consistency with Regulation A, current Item 13 has been
amended to cover the registrants last two fiscal years.
E. Financial Statements Form S-18
required audited financial statements substantially in accordance with those
required by Regulation A.
13 Specifically Form S-18 requires: (1) a
consolidated balance sheet as of a date within 90 days prior to the date of
filing the registration statement; and (2) consolidated statements of income,
source and application of funds, and other stockholders equity for the two
fiscal years prior to the date of filing, prepared in accordance with GAAP.
14 Also, in order to ensure adequate financial statement disclosure in
situations where an issuer has or is about to by purchase or pooling of interest
succeed to one or more businesses which, in the aggregate, are significant, Item
15 has been amended to require appropriate statements.
A
registrant may, therefore, include substantially more simplified financial
statements in Form S-18 than would otherwise be required in Form S-1. The
Commission believes that the elimination of expenses through the simplification
of the financial statements and schedules will result in costs savings to
registrants and, at the same time, provide adequate information to investors
with respect to offerings of $5 million or less. The Commission specifically
requested comments, and received an affirmative response, concerning the
adequacy of this reduced financial disclosure by small business and its ability
to facilitate the raising of capital in a manner consistent with the protection
of investors.
F. Place of Filing on Form S-18 In
Securities Act Release No. 5915 the Commission invited comments on the benefits
of giving registrants the option of filing registration statements either at the
Commissions principal office in Washington or at a specified Regional Office.
Such potential for regional filing was seen by commentators as one of the
primary benefits of Form S-18. Accordingly, the Commission has determined to
allow requirements utilizing Form S-18 to file in Washington or to file in the
Regional Office for the region in which the issuers principal business
operations are conducted or proposed to be conducted in the United States. An
issuer having or proposing to have its principal business operations in Canada
shall have the option of filing Form S-18 in Washington or in the Regional
Office nearest the place where the issuers principal business operations are
conducted or proposed to be conducted, unless the offering is to be made through
a principal underwriter located in the United States, in which case the issuer
shall have the option of filing in Washington or with the Regional Office for
the reason in which such underwriter has its principal office.
Implementation of optional regional processing of Form S-18 filings will require
a brief training program encompassing the Commissions nine Regional Offices.
Due to logistical considerations, the nine Regional Offices will be split into
two training sessions. Filing in the respective Regional Offices will be
permitted upon completion of that particular offices training. Initiation of
regional filing of Form S-18 in the Regional Offices in Atlanta, Boston,
Chicago, Denver and Los Angeles, is tentatively scheduled for June 15, 1979, and
in the Regional Offices in Fort Worth, New York, Seattle and Washington, for
September 15, 1979. The Commission will issue Releases announcing when
particular Regional Offices are available for Form S-18 filings. Until the time
of filing availability in the particular Regional Office for which a registrant
will have the option of filing Form S-18 registration statements, all such
registration statements shall be filed at the Commissions principal office in
Washington.
Implementation of regional processing of Form S-18 filings requires amendment of
several of the Commissions organizational and procedural rules. Specifically,
Rule 27 (17 CFR 200.27) and Rule 30-6 (17 CFR 200.30-6) of the Commissions
Organization Rules have been amended to give the Regional Administrators
authority to process and declare effective registration statements on Form S-18
and amendments thereto pursuant to delegated authority. The Commissions
procedural rule regarding the processing of filings (17 CFR 202.3) has been
amended to reflect the fact that the Regional Offices will be processing Form
S-18 filings. Two rules under the Securities Act of 1933, Rule 455 (17 CFR
230.455) regarding the place of filing of registration statements and Rule 463
(17 CFR 230.463) regarding the preparation and filing of Form SR, have also been
amended to provide for optional Regional Office filing of Form S-18 and
corresponding Form SRs.
Amendment
to Guide 23
Guide 23
of the Guides For the Preparation and Filing of Registration Statements Under
the Securities Act of 1933 represents policies and practices developed by the
Division of Corporation Finance with respect to the need for updating financial
statements and related data in registration statements. The amendment to Guide
23 provides that, in the event that there is a delay between the date of filing
the registration statement on Form S-18 and its effectiveness, registrants with
an established record of earnings and in a sound financial condition may be
required to furnish later sales and net income information on a quarterly basis
compared with a similar period of the preceding year, if the amendment when
effective would otherwise include data over four and one-half months old. This
information will follow the statement of income in the prospectus.
Registrants with no established record of earnings and registrants currently
showing losses or a weak financial condition will be required to furnish the
above data or may be required to bring the financial statement up to the latest
practicable date not more than 90 days prior to filing the amendment upon which
it is expected the filing will become effective. In addition, if delay carries
the effective date beyond the close of the fiscal year and, by applying due
diligence, the registrant and its independent accountant can have an audit
completed prior to the planned effective date, audited statements for that
fiscal year should be substituted for interim statements whether or not the
interim financial statements have been audited.
The
amendment also provides that in those situations where numerous or involved
financial transactions have been effected since the date of the financial
statements furnished, or where it is recognized that unusual conditions affect
the determination of earnings, the Division of Corporation Finance has indicated
that later interim financial statements may be requested on an audited basis as
a condition to acceleration under section 8(a) of the Act.
Amendment
to Form 10-K
In order
to further reduce the expenses resulting from registration under the Securities
Act, the Commission will allow registrants filing on Form S-18, and thereby
becoming subject to the reporting provisions of section 15(d) of the Exchange
Act, to include audited Regulation A type financial statements covering two
fiscal years in their initial annual report to the Commission on Form 10-K. The
amendment to Instructions as to Financial Statements on Form 10-K provides that
the issuer may include, in lieu of those financial statements otherwise
required, the following information: (1) a consolidated balance sheet as of the
end of the last fiscal year and (2) statements of income, source and application
of funds and other stockholders equity for each of the last two fiscal years
prepared in accordance with GAAP.
15 Registrants, therefore, will be
able to include in their initial annual report on Form 10-K financial statements
prepared on the same basis as those provided in their registration on Form S-18.
A Form
10-K filed for the fiscal year immediately following the fiscal year during
which a registrant has had a registration statement on Form S-18 become
effective may include financial statements prepared as follows: financial
statements for the most recent fiscal year shall be prepared in accordance with
Regulation S-X; and Financial statements for the prior year, previously
disclosed in the registration statement on Form S-18 in accordance with
generally accepted accounting principles and practices, do not need to include
the compliance items and schedules of Regulation S-X, but should be recast to
show the same line items as are set forth for the most recent fiscal year.
In
addition, the Commission has determined to allow Form S-18 registrants to
include narrative disclosure in their initial Form 10-K which is consistent with
that called for by Form S-18. Accordingly, new General Instruction J to Form
10-K provides that issuers filing their initial Form 10-K pursuant to an
offering on Form S-18 may include an update of the information provided in
response to Form S-18 Item 6, Description of Business; Item 10, Remuneration of
Directors and Officers; and, Item 13, Interest of Management and Others in
Certain Transactions, in lieu of the information called for by Form 10-K Item 1,
Business, and Item 15, Management Remuneration and Transactions. In addition,
Form 10-K General Instruction J provides that Item 2. Summary of Operations, may
be omitted by such issuer.
AMENDMENTS
Accordingly, 17 CFR Chapter II is amended as follows:
I. PART 200-ORGANIZATION; CONDUCT AND ETHICS; AND INFORMATION AND
REQUESTSI. Section
200.27 is amended by revising the second sentence to read as follows: §200.27
The Regional Administrators.
* * * The
Regional Administrators responsibilities include particularly the investigation
of transactions in securities on national securities exchanges, in the
over-the-counter market, and in distribution to the public; the examination of
members of national securities exchanges and registered brokers and dealers,
investment advisers and investment companies including the examination of
reports filed under §240.17a-5 of this chapter; the examination and processing
of filings under §§ 230.251 to 230.264 of this chapter issued pursuant to
section 3(b) of the Securities Act of 1933; the examination and processing of
filings under §239.28 of this chapter and any related filings the Trust
Indenture Act of 1939; the prosecution of injunctive actions in U.S. District
Courts and administrative proceedings before Administrative Law Judges; the
rendering of assistance to U.S. Attorneys in criminal cases; and the making of
the Commissions facilities more readily available to the public in that region.
* * *
* * * * *
2. Section
200.30-6 is amended by inserting a new paragraph (a) and redesignating present
paragraphs (a), (b), (c), (d) and (3) as paragraphs (b), (c), (d), (e) and (f)
as follows:
§200.30-6
Delegation of authority to Regional Administrators.
* * * * *
(a) With
respect to registration of securities on Form S-18 (§239.28 of this Chapter)
pursuant to the Securities Act of 1933 (15 U.S.C. 77a et seq.), and Regulation C
thereunder (§230.400 et seq. of this Chapter):
(1) To
determine the effective dates of amendments filed pursuant to Section 8(c) of
the Act (15 U.S.C. 77h(c)).
(2) To
consent to the withdrawal of registration statements or amendments or exhibits
thereto, pursuant to Rule 477 (§230.477 of this Chapter), and to issue orders
declaring registration statements abandoned, pursuant to Rule 479 (§230.479 of
this Chapter).
(3) To
grant applications for confidential treatment of contract provisions pursuant to
Rule 485 (§230.485 of this Chapter) under the Act.
(4) To
take the following action pursuant to section 8(a) of the Act (15 U.S.C.
77j(a)):
(i) To
determine registration statements to be effective within shorter periods of time
than 20 days after the filing thereof;
(ii) To
consent to the filing of amendments prior to the effective dates of registration
statements as part thereof, or to determine that amendments filed prior to the
effective dates of registration statements have been filed pursuant to orders of
the Commission, so as to be treated as parts of the registration statements for
the purpose of Section 8(a) of the Act (15 U.S.C. 77h(a));
(iii) To
determine to be effective applications for qualification of trust indentures
filed with registration statements.
(b) No
change from former paragraph (a) under §200.30-6
(c) No
change from former paragraph (b) under §200.30-6
(d) No
change from former paragraph (c) under §200.30-6
(e) No
change from former paragraph (d) under §200.30-6
(f) No
change from former paragraph (e) under §200.30-6
II. PART
202-INFORMAL AND OTHER PROCEDURES Section
202.3 is amended by adding the following sentence to paragraph (a):
§202.3
Processing of filings.
(a) * * *
A similar procedure is also followed in the Commissions Regional Offices with
respect to registration statements on Form S-18 (17 CFR 239.28) and related
filings under the Trust Indenture Act of 1939.
* * * * *
2. Section
230.463 is amended by adding the following sentence to paragraph (a):
§230.463
Report of sales of securities and use of proceeds therefrom.
(a) * * *
From SR reports shall be filed at the same office of the Commission where the
registration statement to which it relates was filed.
* * * * *
IV. PART
231-INTERPRETATIVE RELEASES RELATING TO THE SECURITIES ACT OF 1933 AND GENERAL
RULES AND REGULATIONS THEREUNDER Part 231 is amended by revising paragraph
(a)(5) of Guide 23 of Guides for Preparation and Filling of Registration
Statements Under the Securities Act of 1933 as follows: 23.
Current Financial Statements and Related Data.
* * * * *
(a)(1)-(4) No change.
(5) Form S-18. In the event that there is a delay between the date of
filing the registration statement and its effectiveness, registrants with an
abolished record of earnings and in a sound financial condition should be
prepared to furnish, in a paragraph following the Statement of Income, sales and
net income information on a quarterly basis compared with a similar period of
the preceding year, if the amendment when effective would otherwise include
financial statements over four and one-half months old.
Registrants with no established record of earnings and registrants currently
showing losses or a weak financial condition should not only furnish the above
sales and net income information but to be prepared to bring the financial
statements up to the latest practicable date not more than 90 days prior to
filing the amendment upon which it is expected the filing will become effective.
If delay carries the date beyond the close of the fiscal year and by applying
due diligence the registrant and its independent accountant can have an audit
completed prior to the planned effective date, audited statements for the fiscal
year, should be substituted for interim statements whether or not the interim
financial statements have been audited.
When later
interim financial statements are to be furnished to supplement either fiscal
year of interim statements which have been audited, the later statements would
in the usual case by unaudited. However, when numerous or involved financial
transactions have been effected since the date of the financial statements
furnished or it is recognized that unusual conditions affect the determination
of earnings, the Division of Corporation Finance has indicated that later
financial statements may be requested on an audited basis as a condition to
acceleration under Section 8(a) of the Act.
* * * * *
V. PART
239-FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933 Part 239,
Subpart A, is amended by adding §239.28 as follows: §239.28 Form S-18, optional
form for the registration of securities to be sold to the public by the issuer
for an aggregate cash price not to exceed $5,000,000.
This graph
could not be reproduced.
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D. C. 20549
FORM S-18
REGISTRATION STATEMENT
Under
The
Securities Act of 1933
(Exact name
of registrant as specified in charter)
(Address of
principal executive offices)
(Address of
principal place of business
or intended
principal place of business)
(Name and
address of agent for services)
(State or other jurisdiction of incorporation).
(Standard industrial classification code number)
(IRS Employer I.D. Number)
Approximate date of commencement of proposed sale
to the
public...................................................
Calculation of Registration Fee Proposed Proposed
Title of maximum maximum
shares offering aggregate
Amount of
being Amount being price offering
registra-
registered registered per unit price
tion fee
(Rule 406) (Rule 405(b)) (Rule 457)
(Rule 457)
The
registrant hereby amends this registration statement on such date or dates as
may be necessary to delay its effective date until the registrant shall file a
further amendment which specially states that this registration statement shall
thereafter become effective in accordance with Section 8(a) of the Securities
Act of 1933 or until the registration statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may determine.
16
FACING SHEET....................
GENERAL INSTRUCTIONS....................
A. Rule as to Use of Form S-18.................... B.
Application of General Rules and Regulations.......... C.
Documents Comprising Registration Statement.......... D. Form
and Content of Prospectus.......... E.
Preparation of Part II.................. PART I. INFORMATION REQUIRED IN PROSPECTUS..........
ITEM
1. Distribution Spread.......... 2. Plan of
Distribution.................... 3. Use of
Proceeds to Registrant............... 4.
Organization Within 5 Years.................... 5. Capital
Structure.................... 6.
Description of Business.............. 7.
Description of Property.............. 8. Pending
Legal Proceedings............ 9.
Directors and Officers............... 10.
Remuneration of Directors and Officers.......... 11.
Options to Purchase Securities.................. 12.
Principal Securities Holders.................... 13.
Interest of Management and Others in Certain Transactions.......... 14. Securities Being Registered.................... 15. Financial Statements...........................
Continued on following page
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS..........
16. Marketing Arrangements.......... 17. Other
Expenses of Registration and Distribution...... 18.
Relationship with Registrant of Experts Named in Registration
Statement.................... 19. Recent
Sales of Unregistered Securities.......... 20.
Exhibits....................UNDERTAKINGS....................
SIGNATURES................
INSTRUCTIONS AS TO EXHIBITS.................
GENERAL INSTRUCTION
A. Rule as to be Use for Form S-18.
(a) This form is to be used for the registration of securities of any
corporation not to exceed an aggregate offering price of $5 million which are to
be sold for cash by the issuer or for the account of security holders in
accordance with paragraph A(b), provided such corporation:
(1) is
incorporated under the laws of the United States or Canada or any State or
Province thereof, and has or proposes to have its principal business operations
in the United States if a domestic corporation, or Canada or the United States
if a Canadian corporation;
(2) is not
subject to the reporting provisions of the Securities Exchange Act of 1934
pursuant to Section 12 or 15(d) of that Act;
(3) is not
offering limited partnership interests;
(4) is not
an investment company;
(5) does
not engage or intend to engage in oil and gas related operations which exceed
the criteria for exemption specified in Section 210.3-18(k) of Regulation S-X;
(6) does
not engage or intend to engage in significant mining operations;
Instruction: For purposes of this form, the criteria for exemption specified
in Section 210.3-18(k) of Regulation S-X for oil and gas operations shall be
considered by analogy as an appropriate test for determining the significance of
mining operations.
(7) is not
an insurance company which is exempt from the provisions of Section 12 of the
Securities Exchange Act of 1934 in reliance upon Section 12(g)(2)(G) thereof;
and
(8) is not
a majority owned subsidiary of an issuer which does not meet the qualifications
for use of the form, as specified herein.
(b) This
form may be used for the registration of securities to be sold for the account
of any person other than the issuer, provided the aggregated offering price with
respect to such securities registered on Form S-18 does not exceed $1.5 million.
(c) For
purposes of computing the $5 million ceiling specified above, there shall be
included in the aggregate offering price of the securities registered herein,
the aggregate offering price of all securities of the issuer sold within one
year prior to the commencement of the proposed offering: (i) in violation of
Section 5(a) of the Act; or (ii) pursuant to a registration statement filed on
Form S-18. For purposes of this rule, the term "securities of the issuer" shall
include securities issued by any predecessor of the issuer or by any affiliate
of the issuer which was organized or became such an affiliate within the past
two years.
(d)
Notwithstanding the provisions of paragraph (a)(2), a registrant which has had a
prior offering on Form S-18 may, during the remainder of the fiscal year in
which the prior registration was made effective, use the form to register
additional securities until the offering limit as computed in paragraph (c) has
been met.
B. Place of Filing.
All registration statements on Form S-18 and related papers filed with
the Commission shall be filed at its principal office in Washington, D.C. Such
material may be filed by delivery to the Commission through the mails or
otherwise.
Notes: (1)
At the completion of Commission training programs for its Regional Office
personnel, registrants will have the option of filing Form S-18 either in
Washington or in the Regional Office for the region in which the issuers
principal business operations are conducted are proposed to be conducted in the
United States. Initiation of regional filing of Form S-18 in the Regional
Offices in Atlanta, Boston, Chicago, Denver, and Los Angeles, is tentatively
scheduled for June 15, 1979, and in the Regional Offices in Fort Worth, New
York, Seattle, and Washington, for September 15, 1979. Questions concerning the
appropriate place of filing may be directed to the Commissions Regional
Offices.
(2) The
Commission will endeavor to process Form S-18 registration statements at the
place of filing. However, due to workload or other special considerations, the
Commission may refer processing to a different Commission office.
C. Application of General Rules and Regulations.
(a) Attention is directed to the General Rules and Regulations under the
Act, particularly those comprising Regulation C. That regulation contains
general requirements regarding the preparation and filing of the registration
statement. The definitions contained in Rule 405 should be especially noted.
(b)
Specific attention is directed to Form SR which is required to be filed by
first-time registrants under the Securities Act showing sales of registered
securities and the use of proceeds therefrom. Form SR shall be filed at the same
office where the registration statement was filed.
(c)
Attention is directed to Securities Act Release No. 4968 (April 24, 1969) 34 FR
7235 regarding the Commissions policy with respect to the prior delivery of
preliminary prospectuses by registrants not subject to the reporting
requirements of the Exchange Act. See the Appendix to this form.
D. Documents Comprising Registration Statement.
The registration statement shall consist of the facing sheet of the form,
the prospectus containing the information specified in Part I, the information
called for by Part II, the required signatures, consents of experts, and
exhibits, and any other information or documents which are required or which the
registrant may file as a part of the registration statement.
E. Form and Content of Prospectus.
(a). The prospectus shall contain the information called for by all of
the items of Part I of the form, except that no reference need be made to
inapplicable items, and negative answers to any item may be omitted. Unless
clearly indicated otherwise, information set forth in any part of the prospectus
need not be repeated elsewhere in the prospectus. Where it is deemed necessary
or desirable to call attention to information contained elsewhere in the
prospectus, this may be done by an appropriate cross reference.
(b) Where
appropriate to a clear understanding by investors of the speculative or
promotional nature of the enterprise, an introductory statement shall be made in
the prospectus summarizing the factors which make the offering a speculation and
setting forth such matters as a comparison, in percentages of the securities
being offered to the public for cash and those issued or to be issued to
promoters, directors, officers, controlling persons and underwriters for cash,
property and services.
(c)
Attention is directed to the Division of Corporation Finances Guides For
Preparation and Filing of Registration Statements Under the Securities Act of
1933 (17 CFR 231.4936, as amended). The Guides represent Division practices with
respect to the disclosure to be provided in registration statements. Registrants
filing on this Form, however, need not include the charts and graphs called for
by Guide 6.
Special
attention is directed to Guide 62, Disclosure of Projections of Future Economic
Performance.
F. Preparation of Part II. Part II of the registration statement shall contain the numbers and
captions of the items in Part II of the form, but the text of the items may be
omitted provided the answers are so prepared as to indicate to the reader the
coverage of the items without the necessity of referring to the text of the
items or the instructions thereto. If the information required by any item of
Part II is completely disclosed in the prospectus, reference may be made to the
specific page or caption of the prospectus which contains such information.
PART I.
INFORMATION
REQUIRED IN PROSPECTUS
Item 1. Distribution Spread.
The information called for by the following table shall be given, in
substantially the tabular form indicated, on the outside front cover page of the
prospectus as to all securities being registered (estimate, if necessary).
Price Underwriting Proceeds to to discounts and registrant or
Public commissions other persons
Per Unit
Total
Instructions. 1. The term "commissions" has the meaning given in paragraph
(17) of Schedule A of the Act. Only commissions paid by the registrant in cash
are to be included in the table. Commissions paid by other persons, and other
considerations to the underwriters, shall be set forth following the table with
a reference thereto in the second column of the table. Any finders fees or
similar payments shall be appropriately disclosed.
2. If it
is impracticable to state the price to the public, the method by which it is to
be determined shall be explained. Item 2. Plan of Distribution.
(a) If the securities being registered are to be offered through
underwriters, give the names of the principal underwriters, give the names of
the principal underwriters, and state the respective amounts underwritten.
Identify each such underwriter having a material relationship to the registrant
and state the nature of the relationship. State briefly the nature of the
underwriters obligation to take the securities.
Instruction. All that is required as to the nature of the underwriters
obligation is whether the underwriters are or will be committed to take and to
pay for all of the securities if any are taken, or whether it is an agency or
"best efforts" arrangement under which the underwriters are required to take and
pay for only such securities as they may sell to the public. Conditions
precedent to the underwriters taking the securities including "market outs,"
need not be described except in the case of an agency or "best efforts"
arrangement.
(b) State
briefly the discounts and commissions to be allowed or paid to dealers,
including all cash, securities, contracts or other consideration to be received
by any dealer in connection with the sale of the securities.
Instruction. If any dealers are to act in the capacity of subunderwriters
and are to be allowed or paid any additional discounts or commissions for acting
in such capacity, a general statement to that effect will suffice without giving
the additional amounts to be so paid.
(c)
Outline briefly the plan of distribution of any securities being registered
which are to be offered otherwise than through underwriters.
(d)
Identify any principal underwriter that intends to confirm sales to any accounts
over which it exercises discretionary authority and include an estimate of the
amount of securities so intended to be confirmed.
Instruction. The response to this item shall be contained in a pre-effective
amendment which will be circulated if the information is not available when the
registration statement is filed.
Item 3. Use of Proceeds to Registrant.
State the principal purposes for which the net proceeds to the registrant
from the securities to be offered are intended to be used, and the approximate
amount intended to be used for each such purpose.
Instructions. 1. Details of proposed expenditures are not to be given; for
example, there need be furnished only a brief outline of any program of
construction or addition of equipment. If any substantial portion of the
proceeds has not been allocated for particular purposes, a statement to that
effect shall be made together with a statement of the amount of proceeds not so
allocated.
2. Include
a statement as to the use of the actual proceeds if they are not sufficient to
accomplish the purposes set forth and the order of priority in which they will
be applied. However, such statement need not be made if the underwriting
arrangements are such that, if any securities are sold to the public, it can be
reasonably expected that the actual proceeds of the issue will not be
substantially less than the estimated aggregate proceeds to the registrant as
shown under Item 1. 3. If any
material amounts of other funds are to be used in conjunction with the proceeds,
state the amounts and sources of such other funds. If any material part of the
proceeds is to be used to discharge a loan, the item is to be answered as to the
use of the proceeds of the loan if the loan was made within one year; otherwise,
it will suffice to state that the proceeds are to be used to discharge the
indebtedness created by the loan. 4. If any
material amount of the proceeds is to be used to acquire assets, otherwise than
in the ordinary course of business, briefly described the assets and give the
name of the persons from whom they are to be acquired. State the cost of the
assets to the registrant and the principle followed in determining such cost. Item 4. Organization Within 5 Years.
If the registrant was organized within the past 5 years, furnish the
following information: (a) State the names of the promoters, the nature and
amount of anything of value (including money, property, contracts, options or
rights of any kind) received or to be received by each promoter directly or
indirectly from the registrant, and the nature and amount of assets, services or
other consideration therefor received or to be received by the registrant. The
term "promoter" is defined in Rule 405 under the Act.
(b) As to
any assets required or to be acquired by the registrant from a promoter, state
the amount at which acquired or to be acquired and the principle followed or to
be followed in determining the amount. Identify the persons making the
determination and state their relationship, if any, with the registrant or any
promoter. If the assets were acquired by the promoter within two years prior to
their transfer to the registrant, state the cost thereof to the promoter.
(c) List
all parents of the registrant showing the basis of control and as to each
parent, the percentage of voting securities owned or other basis of control by
its immediate parent, if any.
Instruction. Include the registrant and show the percentage of its voting
securities owned or other basis of control by its immediate parent.
Item 5. Capital Structure.
If the offering would result in a material change in the registrants
capital structure, furnish the information called for by the following table, in
substantially the tabular form indicated, as to each class of securities of the
registrant and each class of securities, other than those owned by the
registrant or its totally-held subsidiaries, of all subsidiaries whose financial
statements are filed with the registration statement on either a consolidated or
individual basis:
Amount
to be Amount outstanding outstanding if all Amount as of a securities
authorized specified being
Title of or to be date within registered
class authorized 90 days
are sold
Instructions. 1. Securities held by or for the account of the issuer thereof
are not to be included in the amount outstanding, but the amount so held shall
be stayed in a note to the table. Also set forth in a note to the table a cross
reference to the note in the financial statements containing information
concerning the extent of obligations under leases on real property.
2.
Indebtedness evidenced by drafts, bills of exchange, bankers acceptances or
promissory notes may set forth in a single aggregate amount under an appropriate
caption such as "Sundry Indebtedness." 3. A
registrant may, at its option, include in the table the capital share liability
in dollars, as well as the amount, of each class of shares shown in the table.
together with capital surplus and earned surplus. Surplus shall be shown in the
same manner as in the balance sheet of the registrant and subsidiaries, if such
a consolidated balance sheet is included in the prospectus. Item 6. Description of Business.
(a) General development of business. Describe the general
development of the business of the registrant, its subsidiaries and any
predecessor(s) during the past five years, or such shorter period as the
registrant may have been engaged in business. Information shall be disclosed for
earlier periods if material to an understanding of the general development of
the business.
(1) In
describing developments, information shall be given as to matters such as the
following: the year in which the registrant was organized and its form of
organization; the nature and results of any bankruptcy, receivership or similar
proceedings with respect to the registrant or any of its significant
subsidiaries; the nature and results of any other material reclassification
merger or consolidation of the registrant or any of its significant
subsidiaries; the acquisition or disposition of any material amount of assets
otherwise than in the ordinary course of business; and any material changes in
the mode of conducting the business.
Instruction: The following requirement in paragraph (2) applies only to
registrants (including predecessors) which have not received revenue from
operations during each of the three fiscal years immediately prior to the filing
of the registration statement.
(2)
Describe, if formulated, the registrants plan of operation for the remainder of
the fiscal year, if the registration statement is filed prior to the end of the
registrants second fiscal quarter. Describe, if formulated, the registrants
plan of operation for the remainder of the fiscal year and for the first six
months of the next fiscal year if the registration statement is filed subsequent
to the end of the second fiscal quarter. If such information is not available,
the reasons for its not being available shall be stated. Disclosure relating to
any plan should include such matters as:
(i) A
statement in narrative form indicating the registrants opinion as to the period
of time that the proceeds from the offering will satisfy cash requirements and
whether in the next six months it will be necessary to raise additional funds to
meet the expenditures required for operating the business of the registrant. The
specific reasons for such opinion shall be set forth and categories of
expenditures and sources of cash resources shall be identified; however, amounts
of expenditure and cash resources need not be provided. In addition, if the
narrative statement is based on a cash budget, such budget should be furnished
to the Commission as supplemental information, but not as a part of the
registration statement.
(ii) An
explanation of material product research and development to be performed during
the period covered in the plan.
(iii) Any
anticipated material acquisition of plant and equipment and the capacity
thereof.
(iv) Any
anticipated material changes in number of employees in the various departments
such as research and development production, sales or administration.
(v) Other
material areas which may be peculiar to the registrants business.
(b) Narrative description of business.
(1) Describe the business done and intended to be done by the registrant
and its subsidiaries. Such description should include, if material to an
understanding of the registrants business, a discussion of:
(a) the
principal products produced and services rendered and the principal markets for
and methods of distribution of such products and services.
(b) the
status of a product or service if the issuer has made public information about a
new product or service which would require the investment of a material amount
of the assets of the registrant or is otherwise material.
(c) the
estimated amount spent during each of the last two fiscal years on
company-sponsored research and development activities determined in accordance
with generally accepted accounting principles. In addition, state the estimated
dollar amount spent during each of such years on material customer-sponsored
research activities relating to the development of new products, services or
techniques or the improvement of existing products, services or techniques.
(d) the
number of persons employed by the registrant indicating the number employed full
time.
(e) the
material effects that compliance with Federal, State and local provisions which
have been enacted or adopted regulating the discharge of materials into the
environment, or otherwise relating to the protection of the environment, may
have upon the capital expenditures, earnings and competitive position of the
registrant and its subsidiaries. The registrant shall disclose any material
estimated capital expenditures for environmental control facilities for the
remainder of its current fiscal year and for such further periods as the
registrant may deem material.
(2) The
registrant should also describe those distinctive or special characteristics of
the registrants operations or industry which may have a material impact upon
the registrants future financial performance. Examples of factors which might
be discussed include dependence on one or a few major customers or suppliers
(including suppliers of raw materials or financing), existing or probable
governmental regulation, expiration of material labor contracts or patents,
trademarks, licenses, franchises, concessions or royalty agreements, unusual
competitive conditions in the industry, cyclicality of the industry and
anticipated raw material or energy shortages to extent management may not be
able to secure a continuing source of supply.
(c)
Segment data. If the registrant is required to include segment information
in its financial statements, such information may be disclosed in the
description of business or in the financial statements. If such information is
included in the financial statements, an appropriate cross reference shall be
included in the description of business.
Item 7. Description of Property.
State briefly the location and general character of the principal plants,
and other materially important physical properties of the registrant and its
subsidiaries. If any such property is not held in fee or is held subject to any
major encumbrance, so state and briefly describe how held.
Instruction. What is required is information essential to an investors
appraisal of the securities being registered. Such information should be
furnished as will reasonably inform investors as to the suitability, adequacy,
productive capacity and extent of utilization of the facilities used in the
enterprise. Detailed descriptions of the physical characteristics of individual
properties or legal descriptions by metes and bounds are not required and should
not be given.
Item 8. Legal Proceedings.
Briefly describe any material legal proceedings other than ordinary
routine litigation incidental to the business to which the registrant or any of
its subsidiaries is a party or of which any of their property is the subject.
Include the name of the court or agency, in which the proceedings are pending,
the date instituted, the principal parties thereto, a description of the factual
basis alleged to underlie the proceeding and the relief sought. Include similar
information as to any such proceedings known to be contemplated by government
authorities.
Instructions. 1. If the business ordinarily results in actions for
negligence or other claims, no such action or claim need be described unless it
departs from the normal kind of such actions.
2. No
information need be given with respect to any proceeding which involves
primarily a claim for damages if the amount involved, exclusive of interest and
costs, does not exceed 10 percent of the current assets of the registrant and
its subsidiaries on a consolidated basis. However, if any proceeding presents in
large degree the same issues as other proceedings pending or known to be
contemplated, the amount involved in such other proceedings shall be included in
computing such percentage. 3.
Notwithstanding Instructions 1 and 2, any material bankruptcy, receivership, or
similar proceeding with respect to the registrant or any of its significant
subsidiaries shall be described. 4. Any
material proceeding to which any director, officer or affiliate of the
registrant, any owner of record or beneficially of more than 5 percent of any
class of voting securities of the registrant, or any associate of any such
director, officer or security holder is a part adverse to the registrant or any
of its subsidiaries or has a material interest adverse to the registrant or any
of its subsidiaries also shall be described. 5.
Notwithstanding the foregoing, administrative or judicial proceedings arising
under any Federal, state or local provisions which have been enacted or adopted
regulating the discharge of materials into the environment or otherwise relating
to the protection of the environment shall not be deemed "ordinary routine
litigation incidental to the business" and shall be described if such proceeding
is material to the business or financial condition of the registrant or if it
involves primarily a claim for damages and the amount involved, exclusive of
interest and costs, exceeds 10 percent of the current assets of the registrant
and its subsidiaries on a consolidated basis. Any such proceedings by
governmental authorities shall be deemed material and shall be described whether
or not the amount of any claim for damages involved exceeds 10 percent of
current assets on a consolidated basis and whether or not such proceedings are
considered "ordinary routine litigation incidental to the business"; provided,
however, that such proceedings which are similar in nature may be grouped and
described generically, stating: the number of such proceedings; the issues
generally involved; and, if such proceedings in the aggregate are material to
the business or financial condition of the registrant, the effect of such
proceedings on the business or financial condition of the registrant. Item 9. Directors and Executive Officers.
(a) Identification of directors. List the names and ages of all
directors of the registrant, and all persons nominated or chosen to become
directors; indicate all positions and offices with the registrant held by each
such person; state his term of office as director and any period(s) during which
he has served as such; briefly describe any arrangement or understanding between
him and any other person or persons (naming such person(s)) pursuant to which he
was or is to be selected as a director or nominee.
Instructions. Do not include arrangements or understandings with directors
or officers of the registrant acting solely in their capacities as such.
2. No
nominee or person chosen to become a director who has not consented to act as
such should be named in response to this item. (b)
Identification of executive officers. List the names and ages of all
executive officers of the registrant and all persons chosen to become executive
officers; indicate all positions and offices with the registrant held by each
such person; state his term of office as officer and the period during which he
has served as such and briefly describe any arrangement or understanding between
him and any other person pursuant to which he was selected as an officer.
Instructions. 1. Do not include arrangements or understandings with
directors or officers of the registrant acting solely in their capacities as
such.
2. No
person chosen to become an executive officer who has not consented to act as
such should be named in response to this item. 3. The
term "executive officer" means the president, secretary, treasurer, any vice
president in charge of a principal business function (such as sales,
administration, or finance) and any other person who performs similar policy
making functions for the registrant. (c)
Identification of certain significant employees. Where the registrant
employs persons such as production managers, sales managers, or research
scientists, who are not executive officers, but who make or are expected to make
significant contributions to the business of the registrant, such persons should
be identified and their background disclosed to the same extent as in the case
of executive officers.
(d)
Family relationships. State the nature of any family relationship between
any director, executive officer, person nominated or chosen by the registrant to
become a director or executive officer or any person named in response to
paragraph (c).
Instruction. The term "family relationship" means any relationship by blood,
marriage, or adoption, not more remote than first cousin.
(e)
Business experience. (1) Give a brief account of the business experience
during the past five years of each director, person nominated or chosen to
become a director or executive officer, and each person named in answer to
paragraph (c), including his principal occupations and employment during that
period and the name and principal business of any corporation or other
organization in which such occupations and employment were carried on. When an
executive officer or person named in response to paragraph (e) has been employed
by the registrant or a subsidiary of the registrant for less than five years, a
brief explanation should be included as to the nature of the responsibilities
undertaken by the individual in prior positions to provide adequate disclosure
of his prior business experience. What is required is information relating to
the level of his professional competence which may include, depending upon the
circumstances, such specific information as the size of the operation
supervised.
(2)
Directorships. Indicate any other directorships held by each director or person
nominated or chosen to become a director in any company with a class of
securities registered pursuant to Section 12 of the Exchange Act or subject to
the requirements of Section 15(d) of that Act or any company registered as an
investment company under the Investment Company Act of 1940, naming such
company.
(f)
Involvement in certain legal proceedings. Describe any of the following
events which occurred during the past five years and which are material to an
evaluation of the ability or integrity of any director, person nominated to
become a director or executive officer of the registrant.
(1) A
petition under the Bankruptcy Act or any State insolvency law was filed by or
against, or a receiver, fiscal agent or similar officer was appointed by a court
for the business or property of such person, or any partnership in which he was
a general partner at or within 2 years before the time of such filing, or any
corporation or business association of which he was an executive officer at or
within two years before the time of such filing;
(2) Such
person was convicted in a criminal proceeding (excluding traffic violations and
other minor offenses);
(3) Such
person was the subject of any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction
permanently or temporarily enjoining him from, or otherwise limiting the
following activities:
(i) Acting
as an investment adviser, underwriter, broker, or dealer in securities, or as an
affiliated person, director or employee of any investment company, bank, savings
and loan association, or insurance company, or engaging in or continuing any
conduct or practice in connection with such activity;
(ii)
Engaging in any type of business practice; or
(iii)
Engaging in any activity in connection with the purchase or sale of any security
or in connection with any violation of Federal or state securities laws.
(4) Such
person was the subject of any order, judgment or decree, not subsequently
reversed, suspended or vacated, of any Federal or state authority barring,
suspending or otherwise limiting for more than 60 days the right of such person
to engage in any activity described in paragraph (f)(3) of this section of to be
associated with persons engaged in any such activity.
(5) Such
person was found by a court of competent jurisdiction in a civil action or by
the Commission to have violated any Federal or state securities law, and the
judgment in such civil action or finding by the Commission has not been
subsequently reversed, suspended, or vacated.
Instructions. 1. For purposes of computing the 5-year period referred to in
this paragraph, the date of a reportable event shall be deemed the date on which
the final order, judgment, or decree was entered, or the date on which any
rights of appeal from preliminary orders, judgments, or decrees have lapsed.
With respect to bankruptcy petitions, the computation date shall be the date of
filing for uncontested petitions or the date upon which approval of a contested
petition became final.
2. If any
event specified in this subparagraph (f) has occurred and information in regard
thereto is omitted on the ground that it is not material, the registrant may
furnish to the Commission, at time of filing, as supplemental information and
not as part of the registration statement, a description of the event and a
statement of the reasons for the omission of information in regard thereto. 3. The
registrant is permitted to explain any mitigating circumstances associated with
events reported pursuant to this paragraph. Item 10. Remuneration of Directors and Officers.
Furnish the following information in substantially the tabular form
indicated as to all remuneration concerning the following persons for services
in all capacities:
(a) each
of the five highest paid persons who are officers or directors of the registrant
whose aggregate remuneration exceeded $50,000, naming each such person.
(b) all
directors and officers of the registrant as a group, without naming them.
Name of individual Capacities in which
or identity of remuneration was Aggregate group received Remuneration
Instructions. 1. Information is to be included as to all options,
securities, or other property given for services, annuity, pension, or
retirement benefits; bonus or profit sharing plans; future remuneration; or
personal benefits. In case of remuneration paid or to be paid otherwise than in
cash, if it is impracticable to determine the cash value thereof, state in a
note to the table the nature and amount thereof.
2. This
item applies to any person who was a director or officer of the registrant at
any time during the period specified. However, information need not be given for
any portion of the period during which such person was not a director or officer
of the registrant. 3. This
item is to be answered on an accrual basis if practicable; if not so answered,
state the basis used. 4. If the
registrant has not completed a full fiscal year since its organization or if it
acquired or is to acquire the majority of its assets from a predecessor within
the current fiscal year, the information shall be given for the current year,
estimating future payments, if necessary. To the extent that such remuneration
is to be computed upon the basis of a percentage of profits, it will suffice to
state such percentage without estimating the amount of such profits to be paid. 5.
Personal benefits. Disclosure shall be provided as to the value of personal
benefits which are not directly related to job performance, other than those
provided to broad categories of employees and which do not discriminate in favor
of officers or directors, furnished by the registrant or its subsidiaries
directly or through third parties to each of the specified persons and groups,
or benefits furnished by the registrant or its subsidiaries to other persons
which indirectly benefit the specified persons. (a)
Valuation. Such benefits shall be valued on the basis of the registrants
and subsidiaries aggregate actual incremental costs; however, if such aggregate
costs are significantly less than the aggregate amounts the recipient would have
to pay to obtain the benefits, appropriate disclosure, including the aggregate
value to the recipient, should be made in a footnote to the table.
(b)
Conditional exclusion of personal benefits. If the registrant cannot
determine without reasonable effort or expense the specific amount of certain
personal benefits, or the extent to which benefits are personal rather than
business, the amount of such personal benefits may be omitted from the table
provided the following condition is met:
Inquiry. After reasonable inquiry, the registrant has concluded that the
aggregate amounts of such personal benefits which cannot be specifically or
precisely ascertained do not in any event exceed $10,000 as to each person or,
in the case of a group, $10,000 for each person in the group and has concluded
that the information set forth in the table is not rendered materially
misleading by virtue of the omission of the value of such personal benefits.
(c)
Footnote disclosure. If as to a person named in the table an amount
presenting personal benefits included in the table exceeds 10 percent of the
aggregate amount disclosed or $25,000, whichever is less, include a footnote to
the table stating the dollar amount or percentage of the amount disclosed
represented by such personal benefits and briefly describing the kinds of such
benefits.
6.
Information relating to any person or retirement benefits need not be disclosed
if the amounts to be paid are computed on an actuarial basis under any plan
which provides for fixed benefits in the event of retirement at a specified age
or after a specified number of years of service. 7.
Information need not be included as to payments to be made for, or benefits to
be received from, group life or accident insurance, group hospitalization or
similar group payments or benefits. If it is impracticable to state the amount
of remuneration payments proposed to be made, the aggregate amount set aside or
accrued to date in respect of such payments should be stated. Item 11. Options to Purchase Securities.
Furnish the following information as to options to purchase securities
from the registrant or any of its subsidiaries which are outstanding as of a
specified date within 30 days prior to the date of filing.
(a)
Describe the options, stating the material provisions including the
consideration received and to be received for such options by the grantor
thereof and the market value of the securities called for on the granting date.
If, however, the options are "qualified stock options" or "restricted stock
options" or "options granted pursuant to a plan qualifying as an employee stock
purchase plan," as those terms are defined in Section 422-424 of the Internal
Revenue Code of 1954, only the following is required: (i) a statement to that
effect, (ii) a brief description of the terms and conditions of the options or
of the plan pursuant to which they were issued, and (iii) a statement of the
provisions of the plan or options with respect to the relationship between the
option price and the market price of the securities at the date when the options
were granted, or with respect to the terms of any variable price option.
(b) State
(i) the title and amount of the securities called for by such options; (ii) the
purchase prices of the securities called for and the expiration dates of such
options; and (iii) the market value of the securities called for by such options
as of the latest practicable date.
Instruction. In case a number of options are outstanding having different
prices and expiration dates, the options may be grouped by prices and dates. If
this producers more than five separate groups, then there may be shown only the
range of the expiration dates and the average purchase prices, i.e., the
aggregate purchase price of all securities of the same class called for by all
outstanding options to purchase securities of that class divided by the number
of securities of such class so called for.
(c)
Furnish separately the information called for by paragraph (b) above for all
options held by (i) each director or officer named in answer to Item 10(a)
naming each such person, (ii) all directors and officers as a group without
naming them, (iii) all affiliates of the issuer, and (iv) in all promoters.
Instructions. 1. The term "options" as used in this item includes all
options, warrants and rights other than those issued to security holders on a
pro rata basis.
2. The
extension of options shall be deemed the granting of options within the meaning
of this item. 3. Where
the total market value of securities called for by all outstanding options as of
the specified date referred to in this item does not exceed $10,000 for any
officer or director named in answer to Item 10(a), or $50,000 for all officers
and directors as a group, or for all option holders as a group, this item need
not be answered with respect to options held by such person or group. Item
12. Security Ownership of Certain Beneficial Owners and Management.
(a)
Security ownership of certain beneficial owners. Furnish the following
information, as of the most recent practicable date, in substantially the
tabular form indicated, with respect to any person (including any "group" as
that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934)
who is known to the registrant to be the beneficial owner of more than five
percent of any class of the registrants voting securities. Shown in Column (3)
the total number of shares beneficially owned and in Column (4) the percent of
class so owned. Of the number of shares shown in Column (3), indicate by
footnote or otherwise the amount known to be shares with respect to which such
listed beneficial owner has the right to acquire beneficial ownership, as
specified in Rule 13d-3(d)(1) 17 CFR 240.13d-3(d)(1) under the Exchange Act.
(1) (2) (3) (4) Name and Amount and Address of Nature of
Beneficial Beneficial Percent of
Title of Class Owner Ownership Class
(b)
Security ownership of management. Furnish the following information, as of
the most recent practicable date, in substantially the tabular form indicated,
as to each class of equity securities of the registrant or any of its parents or
subsidiaries, other than directors qualifying shares, beneficially owned by all
directors naming them and directors and officers of the registrant as a group,
without naming them. Show in Column (2) the total number of shares beneficially
owned and in Column (3) the percent of class so owned. Of the number of shares
shown in Column (2), indicate, by footnote or otherwise, the amount of shares
with respect to which such persons have the right to acquire beneficial
ownership as specified in Rule 13d-3(d)(1) 17 CFR 240.13d-3(d)(1) under the
Exchange Act.
(1) (2) (3)
Title of Class Amount Beneficially Percent of Owned Class
(c)
Changes in control. Describe any arrangements, known to the registrant,
including any pledge by any person of securities of the registrant or any of its
parents, the operation of which may at a subsequent date result in a change in
control of the registrant.
Instructions. 1. The percentages are to be calculated on the basis of the
amount of outstanding securities, excluding securities held by or for the
account of the registrant or its subsidiaries plus securities deemed outstanding
pursuant to Rule 13d-3(d)(1) 17 CFR 240.13d-3(d)(1) under the Exchange Act.
2. For the
purposes of this item, beneficial ownership shall be determined in accordance
with Rule 13d-3 17 CFR 240.13d-3 under the Exchange Act. Include such additional
subcolumns or other appropriate explanation of column (3) necessary to reflect
amounts as to which the beneficial owner has (1) sole voting power, (2) shared
voting power, (3) sole investment power, and (4) shared investment power. 3. For
purposes of furnishing information pursuant to paragraph (a), the registrant may
indicate the source and date of such information. 4. Where
more than one beneficial owner is known to be listed for the same securities,
appropriate disclosure should be made to avoid confusion. 5.
Paragraph (c) does not require a description of ordinary default provisions
contained in the charter, trust indentures or other governing instruments
relating to securities of the registrant. 6. If any
of the securities being registered are to be offered for the account of security
holders, name each such security holder and state the amount of securities owned
by him, the amount to be offered for his account, and the amount to be owned
after the offering. 7. If, to
the knowledge of the registrant or any principal underwriter of the securities
being registered, more than five percent of any class of voting securities of
the registrant are held or are to be held subject to any voting trust or similar
arrangement, state the title of such securities, the amount held or to be held
and the duration of the agreement. Give the names and addresses of the voting
trustees and outline briefly their voting rights and other powers under the
agreement. Item 13. Interest of Management and Others in
Certain Transactions.
Describe briefly any transactions during the previous two years or any
presently proposed transactions, to which the registrant or any of its
subsidiaries was or is to be a party, in which any of the following persons had
or is to have a direct or indirect material interest, naming such person and
stating his relationship to the issuer, the nature of his interest in the
transaction and, where practicable, the amount of such interest:
(1) Any
director or officer of the issuer;
(2) Any
nominee for election as a director;
(3) Any
security holder named in answer to Item 12(a); or
(4) Any
relative or spouse of any of the foregoing persons, or any relative of such
spouse, who has the same house as such person or who is a director or officer of
any parent or subsidiary of the registrant.
Instructions. 1. See Instruction 2 to Item 10(a). No information need by
given in response to this Item as to any remuneration or other transaction
reported in response to Item 10 or specifically excluded from Item 10.
2. No
information need be given in answer to this Item as to any transaction where: (a) the
rates or charges involved in the transaction are determined by competitive bids,
or the transaction involves the rendering of services as a common or contract
carrier, or public utility, at rates or charges fixed in conformity with law or
governmental authority;
(b) the
transaction involves services as a bank depositary of funds, transfer agent,
registrar, trustee under a trust indenture, or similar services;
(c) the
amount involved in the transaction or a series of similar transactions,
including all periodic installments in the case of any lease or other agreement
providing for periodic payments or installments, does not exceed $40,000; or
(d) the
interest of the specified person arises solely from the ownership of securities
of the issuer and the specified person receives no extra or special benefit not
shared on a pro rata basis by all holders of securities of the class.
3. It
should be noted that this item calls for disclosure of indirect, as well as
direct, material interests in transactions. A person who has a position or
relationship with a firm, corporation, or other entity, which engages in a
transaction with the issuer or its subsidiaries may have an indirect interest in
such transaction by reason of such position or relationship. However, a person
shall be deemed not to have a material indirect interest in a transaction within
the meaning of this Item where: (a) the
interest arises only (i) from such persons position as a director of another
corporation or organization (other than a partnership) which is a party to the
transaction, or (ii) from the direct or indirect ownership by such person and
all other persons specified in subparagraphs (1) through (3) above, in the
aggregate, of less than a 10 percent equity interest in another person (other
than a partnership) which is a party to the transaction, or (iii) from both such
position and ownership.
(b) the
interest arises only from such persons position as a limited partner in a
partnership in which he and all other persons specified in (1) through (4) above
had an interest of less than 10 percent; or
(c) the
interest of such person arises solely from the holding of an equity interest
(including a limited partnership interest but excluding a general partnership
interest) or a creditor interest in another person which is a party to the
transaction with the issuer or any of its subsidiaries and the transaction is
not material to such other person.
4. Include
the name of each person whose interest in any transaction is described and the
nature of the relationships by reason of which such interest is required to be
described. The amount of the interest of any specified person shall be computed
without regard to the amount of the profit or loss involved in the transaction.
Where it is not practicable to state the approximate amount of the interest, the
approximate amount involved in the transaction shall be disclosed. 5.
Information should be included as to any material underwriting discounts and
commissions upon the sale of securities by the registrant where any of the
specified persons was or is to be a principal underwriter or is a controlling
person, or member, of a firm which was or is to be a principal underwriter.
Information need not be given concerning ordinary management fees paid by
underwriters to a managing underwriter pursuant to an agreement among
underwriters the parties to which do not include the registrant or its
subsidiaries. 6. As to
any transaction involving the purchase or sale of assets by or to the registrant
or any subsidiary, otherwise than in the ordinary course of business, state the
cost of the assets to the purchaser and if acquired by the seller within two
years prior to the transaction, the cost thereof to the seller. 7.
Information shall be furnished in answer to this item with respect to
transactions not excluded above which involve remuneration from the registrant
or its subsidiaries, directly or indirectly, to any of the specified persons for
services in any capacity unless the interest of such persons arises solely from
the ownership individually and in the aggregate of less than 10% of any class of
equity securities of another corporation furnishing the services to the
registrant or its subsidiaries. 8. The
foregoing instructions specify certain transactions and interests as to which
information may be omitted in answering this item. There may be situations
where, although the foregoing instructions do not expressly authorize
nondisclosure, the interest of a specified person in the particular transaction
or series of transaction is not a material interest. In that case, information
regarding such interest and transaction is not required to be disclosed in
response to this item. The materiality of any interest or transaction is to be
determined on the basis of the significance of the information to investors in
light of all of the circumstances of the particular transaction. The importance
of the interest to the person having the interest, the relationship of the
parties to the transaction to each other and the amount involved in the
transaction to each other and the amount involved in the transaction are among
the factors to be considered in determining the significance of the information
to investors. Item 14. Securities Being Registered.
(a) If capital stock is being registered, state the title of the class
and furnish the following information:
(1)
Outline briefly (i) dividend rights; (ii) voting rights; (iii) liquidation
rights; (iv) pre-emptive rights; (v) conversion rights; (vi) redemption
provisions; (vii) sinking fund provisions; and (viii) liability to further calls
or to assessment by the registrant.
(2) If the
rights of holders of such stock may be modified otherwise than by a vote of a
majority or more of the shares outstanding, voting as a class, so state and
explain briefly.
(3)
Outline briefly any restriction on the repurchase or redemption of shares by the
registrant while there is any arrearage in the payment of dividends or sinking
funds installments. If there is no such restriction, so state.
Instructions. 1. This item requires only a brief summary of the provisions
which are pertinent from an investment standpoint. A complete legal description
of the provisions referred to is not required and should not be given. Do not
set forth the provisions of the governing instruments verbatim; only a succinct
resume is required.
2. If the
rights evidenced by the securities being registered are materially limited or
qualified by the rights of any other class of securities, include such
information regarding such other securities as will enable investors to
understand the rights evidenced by the securities being registered. (b) if
long-term debt is being registered, outline briefly such of the following as are
relevant:
(1)
Provisions with respect to interest, conversion, maturity, redemption,
amortization, sinking fund or retirement.
(2)
Provisions with respect to the kind and priority of any lien securing the issue,
together with a brief identification of the principal properties subject to such
lien.
(3)
Provisions restricting the declaration of dividends or requiring the maintenance
of any ratio of assets, the creation or maintenance of reserves or the
maintenance of properties.
(4)
Provisions permitting or restricting the issuance of additional securities, the
withdrawal of cash deposited against such issuance, the incurring of additional
debt, the release or substitution of assets securing the issue, the modification
of the terms of the security, and similar provisions.
Instructions. 1. In the case of secured debt, there should be stated (i) the
approximate amount of unbonded bondable property available for use against the
issuance of bonds, as of the most recent practicable date, and (ii) whether the
securities being registered are to be issued against such property, against the
deposit of cash, or otherwise.
2.
Provisions permitting the release of assets upon the deposit of equivalent funds
or the pledge of equivalent property, or the release of property no longer
required in the business, obsolete property or property taken by eminent domain,
the application of insurance moneys, and similar provisions, need not be
described. (5) The
name of the trustee and the nature of any material relationship with the
registrant or any of its affiliates; the percentage of securities of the class
necessary to require the trustee to take action, and what indemnification the
trustee may require before proceeding to enforce the lien.
(6) The
general type of event which constitutes a default and whether or not any
periodic evidence is required to be furnished as to the absence of default or as
to compliance with the terms of the indenture.
Instruction. Instructions 1 and 2 under paragraph (a) above shall also apply
to this item. Section 305(a)(2) of the Trust Indenture Act of 1939 shall not be
deemed to require the inclusion in the registration statement or in the
prospectus of any information not required by this form.
(c) If
securities other than capital stock or long-term debt are being registered,
outline briefly the rights evidenced thereby. If subscription warrants or rights
are being registered, state the title and amount of securities called for, the
period during which and the price at which the warrants or rights are
exercisable.
Item 15. Financial Statements and Instructions.
The following financial statements for the issuer, or for the issuer and
its predecessors, prepared in accordance with generally accepted accounting
principles and practices shall be filed as a part of the registration statement.
Regulation S-X, Form and Content of Financial Statements, shall not apply to the
preparation of such financial statements. The report of the independent
accountant shall comply with the requirements of Article 2 of Regulation S-X.
(a) Balance Sheets of the Registrant.
(1) The registrant shall file a consolidated balance sheet as of a date
within 90 days prior to the date of filing the registration statement. This
balance sheet need not be audited if it is not as of the latest fiscal year.
(2) If the
balance sheet required by paragraph (a) is not audited, there shall be filed in
addition an audited balance sheet as of a date within one year unless the fiscal
year of the registrant has ended within 90 days prior to the date of filing, in
which case the audited balance sheet may be as of the end of the preceding
fiscal year.
(b)
Statements of Income, Changes in Financial Condition, and Other Stockholders
Equity.
The
registrant shall file consolidated statements of income, statements of changes
in financial condition, and statements of other stockholders equity for each of
the two fiscal years preceding the date of the most recent balance sheet being
filed and for the interim period, if any, between the end of the most recent of
such fiscal years and the date of the most recent balance sheet being filed.
These statements shall be audited to the date of the most recent audited balance
sheet being filed.
If an
income statement is filed for an interim period, an unaudited income statement
for a complete period of the prior year shall also be filed. In connection with
any unaudited income statements for an interim period, a statement shall be made
that all adjustments necessary for a fair statement of the results for such
period have been included. If all such adjustments are of a normal recurring
nature, a statement to that effect shall be made; otherwise these shall be
furnished as supplementary information, but not as a part of the registration
statement, in a letter describing in detail the nature and amount of any
adjustments other than normal recurring adjustments, entering into the
determination of the results shown.
(c) Past Successions to Other Businesses.
(1) If, during the period for which its income statements are required,
the registrant has by purchase or by pooling of interests succeeded to one or
more businesses which in the aggregate are significant, the additions,
eliminations and other changes effected in the succession shall be appropriately
set forth in a note or supporting schedule to the balance sheets being filed,
and, if a purchase has been effected during the most recent fiscal year or in a
subsequent period, pro forma statements of income reflecting the combined
operations of the entities shall be furnished in columnar form for the latest
fiscal year and any interim periods. In addition, furnish audited income
statements, separate or combined as appropriate, for such business or businesses
for such period prior to the purchase as may be necessary when added to the
time, if any, for which income statements after the purchase are filed to cover
the same period for which income statements of the registrant are required in
Item (b) above. The test of significance shall be based on the tests used in the
term "significant subsidiaries" in Article 1.02(u) of Regulation S-X.
17
(2) This
instruction shall not apply with respect to the registrants succession to the
business of any totally held subsidiary or to the succession of one or more
businesses if such businesses, considered in the aggregate, would not meet the
test of a significant subsidiary.
(d) Future Successions to Other Businesses.
(1) If, after the date of the most recent balance sheet filed pursuant to
paragraph (a) above, the registrant by purchase or by pooling of interests
succeeded or | 
