• SEC Adopts New Form 8-K Triggering Events
  • March 15, 2004
  • Law Firm: King & Spalding LLP - Atlanta Office
  • Yesterday the SEC issued a press release announcing that it has added ten items to the events requiring companies to file Current Reports on Form 8-K. The SEC also shortened the deadline for all Form 8-K filings to four business days after the occurrence of a triggering event.

    The amendments will take effect on August 23, 2004.

    According to SEC staff comments, failure to timely file a Form 8-K for certain of the new trigger events will not bar the use of Form S-2 or Form S-3, if the failure to file is cured by the time the registration statement is filed.

    The definitive amendments are not yet available. Based on the SEC's press release, the 10 new triggers are:

    1. entry into a material non-ordinary course agreement;
    2. termination of a material non-ordinary course agreement;
    3. creation of a material direct financial obligation or a material obligation under an off-balance sheet arrangement;
    4. triggering events that accelerate or increase a material direct financial obligation or a material obligation under an off-balance sheet arrangement;
    5. material costs associated with exit or disposal activities (the proposed rule indicated that this refers to any action, including terminating or exiting an activity, that will result in a material write-off or restructuring charge under GAAP);
    6. material impairments;
    7. notice of delisting, failure to satisfy a continued listing rule or standard, or transfer of listing;
    8. non-reliance on previously issued financial statements or a related audit report or completed interim review (restatements);
    9. unregistered sales of equity securities (formerly a periodic report disclosure item); and
    10. material modifications to rights of security holders (also formerly a periodic report disclosure item).

    The new rules also expand two areas that currently require the filing of a Form 8-K in limited circumstances:

    1. departure of directors or principal officers, election of directors, or appointment of principal officers; and
    2. amendments to Articles of Incorporation or Bylaws, and changes in fiscal year.

    Section 409 of the Sarbanes-Oxley Act of 2002 required the SEC to adopt rules providing for "rapid and current" disclosure of certain information. The SEC originally proposed similar amendments to Form 8-K in June 2002.

    The SEC's press release is located at: http://www.sec.gov/news/press/2004-31.htm

    The SEC's June 2002 proposal is located at: http://www.sec.gov/rules/proposed/33-8106.htm