April 7, 2004

Required Disclosure of Issuer Repurchases

March 15 came and went without much fanfare, but it signaled the start of a new disclosure obligation for public companies. Beginning with their first quarterly or annual filing for a fiscal period ending on or after 3/15/04, they must provide a tabular disclosure regarding repurchases of their own securities. This disclosure is set out in Item 703 of S-K and is required by new Items 2(e) of Form 10-Q and 5(c) of Form 10-K.

A number of companies voluntarily complied with this disclosure requirement in their recent 10-Ks. With the 10-Q filing deadline approaching quickly for calendar year companies (for an accelerated filer with a quarter ended March 31, the 10-Q must be filed by May 10 this year), we have posted in our “Disclosure Analysis and Samples” practice area a new “Issuer Repurchases” page with links to some of those early examples.

The Demise of Physical Stock Certificates and T+3?

Last month, the SEC issued a concept release asking for comment regarding various topics relating to securities transaction settlements. In the release, the Commission is seeking comment on shortening the settlement cycle for securities trades from the (in)famous T+3 (so proceeds and securities would have to move more quickly after the trade date, which they often already do in our wired and wireless world) and on the elimination of physical stock certificates, bringing us closer to a paperless world.

The elimination of physical stock certificates has been a long-standing initiative of the Securities Industry Association and could serve to save companies money and administrative headaches if proposed and eventually adopted. Comment letters are due to the SEC by June 16th.

And Now, It’s that Much Easier to Submit Comments to the SEC

Recently, the SEC upgraded its website to allow anyone to submit comments on a proposal by filling out an “EdgarFeed” form. If you go to a proposing release on the SEC’s website and click the link where it says “Click to Submit Comments,” an online form pops up where you can input the relevant contact info as well as your comments – and then just hit “Submit.”

Although submitting comments before was fairly easy, this new form should facilitate the process even more (e.g. the commenter no longer needs to remember to include the file number as it’s handled automatically). It looks like die-hard commenters can use the new form to submit comments on any rulemaking that was proposed in 2004, not just those that still have open comment periods. Perhaps the shareholder access proposal would have had 20,000 comment letters instead of 13,000 with this form…