[Federal Register Volume 67, Number 170 (Tuesday, September 3, 2002)]
[Rules and Regulations]
[Pages 56462-56469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-22301]



[[Page 56461]]

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Part V





Securities and Exchange Commission





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17 CFR Parts 240, 249, and 274



Ownership Reports and Trading by Officers, Directors and Principal 
Security Holders; Final Rule

  Federal Register / Vol. 67, No. 170 / Tuesday, September 3, 2002 / 
Rules and Regulations  

[[Page 56462]]


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SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 240, 249 and 274

[Release Nos. 34-46421; 35-27563; IC-25720; File No. S7-31-02]
RIN 3235-AI62


Ownership Reports and Trading by Officers, Directors and 
Principal Security Holders

AGENCY: Securities and Exchange Commission.

ACTION: Final rule; request for comment.

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SUMMARY: We are adopting rule and form amendments to implement the 
accelerated filing deadline applicable to change of beneficial 
ownership reports required to be filed by officers, directors and 
principal security holders under Section 16(a) of the Securities 
Exchange Act of 1934, as amended by the Sarbanes-Oxley Act of 2002. The 
amendments are intended to facilitate the statutory changes, which 
become effective August 29, 2002, consistent with their purpose.

DATES: Effective Date: August 29, 2002.
    Comment Date: Comments on the amended rules must be received on or 
before September 30, 2002.

ADDRESSES: Comments should be submitted in triplicate to Jonathan G. 
Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, 
NW, Washington, DC 20549-0609. Comments also may be submitted 
electronically at the following electronic mail address: [email protected]. To help us process and review your comments more 
efficiently, comments should be sent by one method only. All comment 
letters should refer to File No. S7-31-02; this file number should be 
included in the subject line if electronic mail is used. Comment 
letters will be available for public inspection and copying in the 
Commission's Public Reference Room, 450 Fifth Street, NW, Washington, 
DC 20549. Electronically submitted comment letters will be posted on 
the Commission's Internet Web Site (http://www.sec.gov).\1\
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    \1\ We do not edit personal identifying information, such as 
names or electronic mail addresses, from electronic submissions. You 
should submit only information that you wish to make available 
publicly.

FOR FURTHER INFORMATION CONTACT: Anne M. Krauskopf, Special Counsel, 
David Lee, Special Counsel, or Carol McGee, Special Counsel at (202) 
942-2900, Division of Corporation Finance, U.S. Securities and Exchange 
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Commission, 450 Fifth Street, NW, Washington, DC 20549-0402.

SUPPLEMENTARY INFORMATION: We are adopting amendments to Rules 16a-
3,\2\ 16a-6 \3\ and 16a-8 \4\ under the Securities Exchange Act of 1934 
(``Exchange Act''),\5\ and Forms 3,\6\ 4 \7\ and 5 \8\ under the 
Exchange Act.
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    \2\ 17 CFR 240.16a-3.
    \3\ 17 CFR 240.16a-6.
    \4\ We adopt a technical amendment to Rule 16a-8(a)(1) [17 CFR 
240.16a-8(a)(1)], which defines trusts subject to Section 16, to 
implement an amendment that we adopted in Exchange Act Release No. 
37260 (Jun. 14, 1996) [61 FR 30392]. This amendment provides that a 
trust is subject to Section 16 only if the trust is a more than ten 
percent beneficial owner.
    \5\ 15 U.S.C. 78a et seq.
    \6\ 17 CFR 249.103 and 17 CFR 274.202.
    \7\ 17 CFR 249.104 and 17 CFR 274.203.
    \8\ 17 CFR 249.105.
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I. Executive Summary and Background

    Section 16 \9\ applies to every person who is the beneficial owner 
of more than 10% of any class of equity security registered under 
Section 12 of the Exchange Act,\10\ and each officer and director 
(collectively, ``reporting persons'' or ``insiders'') of the issuer of 
such security. Upon becoming a reporting person, or upon the Section 12 
registration of that security, Section 16(a) \11\ requires a reporting 
person to file an initial report with the Commission disclosing his or 
her beneficial ownership of all equity securities of the issuer.\12\ To 
keep this information current, Section 16(a) also requires reporting 
persons to report changes in such ownership, or the purchase or sale of 
a security-based swap agreement \13\ involving such equity security. 
Previously, Section 16(a) provided for such transactions to be reported 
on a monthly basis within 10 days after the close of each calendar 
month in which such a change in ownership or purchase or sale of a 
security-based swap agreement occurs.
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    \9\ 15 U.S.C. 78p.
    \10\ 15 U.S.C. 78l.
    \11\ 15 U.S.C. 78p(a).
    \12\ Rule 3a12-3 [17 CFR 240.3a12-3] provides that securities 
registered by a foreign private issuer, as defined in Rule 3b-4 [17 
CFR 240.3b-4] are exempt from Section 16. The legislative and 
regulatory actions addressed in this release do not change this 
exemption.
    \13\ As defined in Section 206B of the Gramm-Leach-Bliley 
Financial Modernization Act of 1999, as amended by H.R. 4577, P. L. 
No. 106-554, 114 Stat. 2763.
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    On July 30, 2002, the Sarbanes-Oxley Act of 2002 (the ``Act'') \14\ 
was enacted. Section 403(a) of the Act amends Section 16(a) to require 
reports of such a change in ownership or purchase or sale of a 
security-based swap agreement ``before the end of the second business 
day following the day on which the subject transaction has been 
executed, or at such other time as the Commission shall establish, by 
rule, in any case in which the Commission determines that such 2-day 
period is not feasible.'' \15\
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    \14\ Pub. L. 107-204, 116 Stat. 745.
    \15\ Section 16(a)(2)(C) (15 U.S.C. 78p(a)(2)(C)), as amended by 
the Act. Section 30(h) of the Investment Company Act of 1940 (15 
U.S.C. 80a-29(h)) provides that ``Every person who is directly or 
indirectly the beneficial owner of more than 10 per centum of any 
class of outstanding securities (other than short-term paper) of 
which a registered closed-end company is the issuer or who is an 
officer, director, member of an advisory board, investment adviser, 
or affiliated person of an investment adviser of such a company 
shall in respect of his transactions in any securities of such 
company (other than short-term paper) be subject to the same duties 
and liabilities as those imposed by section 16 of the Securities 
Exchange Act of 1934 upon certain beneficial owners, directors, and 
officers in respect of their transactions in certain equity 
securities.'' Accordingly, the Act's amendments also accelerate the 
deadline for change of beneficial ownership reports required 
pursuant to Section 30(h).
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    Section 403(b) of the Act provides that this amendment becomes 
effective 30 days after the date of enactment. That effective date is 
August 29, 2002. Thus, reporting persons will be required to report all 
transactions subject to Section 16(a) for which the date of execution 
(trade date) is on or after August 29, 2002 on Form 4 in accordance 
with the amended two-business day deadline,\16\ except where the rules 
under Section 16(a) provide otherwise.
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    \16\ For example, if a transaction is executed any time on 
Tuesday, September 3, the Form 4 will be due by the close of 
business (5:30 p.m. Eastern time) at the Commission on Thursday, 
September 5. Because the Act does not change the due date for Form 
3, situations may arise where a reporting person is required to file 
a Form 4 before the Form 3 is due. In this situation, we encourage 
the reporting person to file the Form 3 along with the Form 4 at the 
time the Form 4 is due.
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    On August 6, 2002, we announced that we anticipated adopting final 
rules to implement the new accelerated reporting deadline, effective no 
later than the August 29, 2002 effective date of the Section 16(a) 
amendments.\17\ The final rules that we adopt today accomplish the 
following:
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    \17\ Exchange Act Release No. 46313 (Aug. 6, 2002) [67 FR 
51900]. Comment letters relating to that release refer to File No. 
S7-31-02. Comment letters are available for public inspection and 
copying in the Commission's Public Reference Room, 450 Fifth Street, 
NW., Washington, DC 20549. Electronically submitted comment letters 
are posted on the Commission's Internet Web Site (http://www.sec.gov).
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 Amend the Section 16(a) forms to conform all references to the 
Form 4 filing deadline to the amended statutory filing deadline and to 
reflect that Form 4 is no longer a monthly form.
 Amend Rule 16a-6(b), the small acquisitions rule, to conform 
the description of the Form 4 deadline contained in that rule to the 
amended statutory filing deadline.

[[Page 56463]]

 Amend Rules 16a-3(f) and 16a-6(a) so that transactions between 
officers or directors and the issuer exempted from Section 16(b) \18\ 
short-swing profit recovery by Rule 16b-3 \19\ previously reportable on 
an annual basis on Form 5 \20\ will be required to be reported within 
two business days on Form 4.
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    \18\ 15 U.S.C. 78p(b).
    \19\ 17 CFR 240.16b-3. Rule 16b-3 is available to exempt 
transactions between an officer or director and the issuer 
(including an employee benefit plan sponsored by the issuer), 
subject to satisfaction of the transaction-specific conditions 
prescribed by the rule.
    \20\ 17 CFR 249.105. Form 5 is due within 45 days after the 
issuer's fiscal year end.
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 Amend Rule 16a-3(g) to calculate the two-business day Form 4 
due date differently for the following transactions, for which we have 
determined that the amended Section 16(a) statutory reporting period is 
otherwise not feasible: \21\
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    \21\ In Exchange Act Release No. 46313 we stated that we also 
would consider calculating the deadline differently for a 
transaction pursuant to a single market order that is executed over 
more than one day, but not to exceed a specified number of days. 
Because we believe that it is feasible to report these transactions 
as they are executed, we are not modifying the calculation of the 
statutory two-business day deadline for these transactions.
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     Transactions pursuant to arrangements that satisfy the 
affirmative defense conditions of Exchange Act Rule 10b5-1(c) \22\ 
where the reporting person does not select the date of execution; and
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    \22\ 17 CFR 240.10b5-1(c).
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     Discretionary Transactions pursuant to employee benefit 
plans where the reporting person does not select the date of 
execution.\23\
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    \23\ ``Discretionary Transaction'' is defined in Rule 16b-
3(b)(1).
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    We are not adopting any rules to calculate the Form 4 filing 
deadline differently based on non-feasibility for any other categories 
of transactions.\24\ The amendments we adopt today will apply to 
transactions that occur on or after August 29, 2002. Transactions 
previously reportable on Form 5 that are not covered by the Rule 16a-
3(f) amendments will remain reportable on Form 5 to the same extent as 
before, and transactions previously exempt from Section 16(a) reporting 
will remain exempt. An insider's failure to timely file a Section 16(a) 
report will remain subject to the company's disclosure obligation,\25\ 
which we are not amending.
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    \24\ However, we request comment in Section IV, below, as to 
whether there are other types of transactions that require 
regulatory changes to make it feasible for insiders to report them 
within the two-business day deadline.
    \25\ This obligation is set forth in Item 405 of Regulations S-K 
and S-B [17 CFR 229.405 and 17 CFR 228.405, respectively], and is 
required disclosure in the annual report on Form 10-K [17 CFR 
249.310] or Form 10-KSB [17 CFR 249.310b] and the proxy statement 
for the annual meeting at which directors are to be elected [17 CFR 
240.14a-101, Item 7].
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II. Rule and Form Amendments

A. Conforming Amendments to Rule 16a-6 and Forms 4 and 5

    We are amending Form 4 (including the General Instructions to the 
form) to conform all references to the applicable filing deadline to 
the amended statutory filing deadline, and to reflect that Form 4 is no 
longer a monthly form.\26\ In particular, the revised form provides 
that the holdings columns must report holdings following the reported 
transaction(s), rather than month-end holdings.\27\ The form also 
specifically provides that reportable Rule 16b-3 exempt transactions 
must be reported on Form 4.\28\
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    \26\ See revised Form 4 General Instruction 1(a), and Items 4 
and 5.
    \27\ See revised Form 4 General Instructions 3(a)(i), 3(a)(ii), 
3(a)(iii), and 4(a)(i), Table I column 5 and Table II column 9. 
Reporting holdings following the reported transaction(s) will 
satisfy the statutory requirement to report ``ownership by the 
filing person at the date of filing'' set forth in amended Section 
16(a)(3)(B). In keeping with current practice, insiders will reflect 
changes in holdings resulting from transactions exempt from Section 
16(a) in the holdings column of the next otherwise required Form 4 
or 5 filed to report a transaction in securities of the same class. 
See Section IV.A of Exchange Act Release No. 37260. An insider may 
rely in good faith on the last plan statement in reporting holdings 
pursuant to 401(k) plans and other Rule 16b-3(c) exempt plans.
    \28\ See revised Form 4 General Instruction 4(a)(i), and amended 
Rules 16a-3(f)(1)(i)(A), and 16a-3(g)(1), discussed in Section II.B, 
below, and amended Rule 16a-6(a), discussed below in this section.
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    In addition, we are adding new column 2A to Table I of Form 4 and 
column 3A to Table II to require reporting of deemed execution dates 
computed in accordance with the Rule 16a-3(g) amendments adopted 
today.\29\ These columns, which must be completed only if such a deemed 
execution date applies to the transaction reported,\30\ will enable 
investors and members of the Commission staff reading the form to 
determine if the form was filed on a timely basis as readily as with 
the current form. Table I column 2 and Table II column 3, which require 
the transaction date to be reported, will continue to require the 
transaction's trade date to be reported.
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    \29\ See Section II.B, below.
    \30\ See revised Form 4 General Instruction 4(a)(ii).
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    We also are adding new columns 2A and 3A to Form 5, so that 
investors and members of the Commission staff reading that form 
similarly will be able to determine how late a transaction was 
reported.\31\ Finally, we revise Form 5 to clarify that reportable Rule 
16b-3 exempt transactions no longer may be reported on that form on a 
deferred basis.\32\
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    \31\ See revised Form 5 General Instruction 4(a)(ii).
    \32\ See revised Form 5 General Instruction 4(a)(i)(A). We also 
adopt technical amendments to Form 3 General Instruction 5(b)(v), 
Form 4 General Instruction 4(b)(v) and Form 5 General Instruction 
4(b)(v) to omit references to furnishing the Social Security Numbers 
of natural persons, consistent with the amendments we adopted in 
Securities Act Release No. 7424 (Jun. 25, 1997) [62 FR 35338].
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    We plan to publish new forms implementing these amendments as soon 
as possible. Until amended forms are available, reporting persons 
should continue to use the current versions, but should modify box 4 on 
Form 4 to state the month, day and year of the transaction. When using 
the current forms to report a transaction with a deemed execution date 
computed pursuant to amended Rule 16a-3(g), a reporting person should 
include an asterisk next to the trade date in the transaction date 
column, and add a footnote to disclose the deemed execution date.
    Rule 16a-6 permits small acquisitions to be reported on Form 5, 
subject to specified conditions.\33\ If the conditions are no longer 
met, so that the small acquisition no longer qualifies for deferred 
reporting on Form 5, it must be reported on a Form 4. We are amending 
the rule to conform the Form 4 due date for this purpose to the two-
business day due date provided by the Act, so the Form 4 will be due 
two business days after the deferral conditions are no longer met.\34\
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    \33\ As currently provided in Rule 16a-6(a), a small acquisition 
is an ``acquisition of an equity security not exceeding $10,000 in 
market value, or of the right to acquire such securities[.]'' The 
conditions for deferring reporting to Form 5 are set forth in Rules 
16a-6(a)(1) and 16a-6(a)(2).
    \34\ Rule 16a-6(b).
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    We also are amending the rule so that it will not be available to 
defer reporting of small acquisitions from the issuer (including an 
employee benefit plan sponsored by the issuer).\35\ This will prohibit 
reliance on Rule 16a-6 to report on Form 5 transactions exempted by 
Rule 16b-3 that will be required to be reported on Form 4, as described 
immediately below.
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    \35\ Rule 16a-6(a).
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B. Amendments to Rule 16a-3

    Rule 16a-3 sets forth the general reporting requirements under 
Section 16(a). We are amending this rule in several respects to address 
the reporting modifications effected by the Act.
    Form 4 reporting within two business days of officers' and 
directors' transactions with an issuer exempted by Rule 16b-3 that 
previously were reportable on Form 5 is necessary to

[[Page 56464]]

satisfy the Act's purpose to require immediate disclosure of insider 
transactions. Accordingly, we amend the rule to eliminate deferred 
reporting for these Section 16(b) exempt transactions and specifically 
require reporting on Form 4.\36\ We previously solicited comment on 
this regulatory action.\37\
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    \36\ Rules 16a-3(f)(1)(i)(A) and 16a-3(g)(1). Rule 16a-3(g)(1) 
also is amended to conform with the statute by providing that Form 4 
must be filed before the end of the second business day following 
the day on which the subject transaction has been executed.
    \37\ ``Form 8-K Disclosure of Certain Management Transactions,'' 
Securities Act Release No. 8090, Exchange Act Release No. 45742 
(Apr. 12, 2002) [67 FR 19914, at 19920] (``Form 8-K Release''). As 
we stated in Exchange Release No. 46313, in light of the statutory 
amendments to Section 16(a), we do not intend to consider further 
our proposed amendments to require companies to report on Form 8-K 
directors' and executive officers' transactions in company equity 
securities. However, we continue to consider the other amendments we 
proposed in the Form 8-K Release. These proposed amendments would 
require companies to disclose information about (1) directors' and 
executive officers' arrangements intended to satisfy the affirmative 
defense conditions of Exchange Act Rule 10b5-1(c) and (2) company 
loans and loan guarantees to directors and executive officers that 
are not prohibited by Section 402 of the Act.
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    Consequently, grants, awards and other acquisitions from the issuer 
exempted by Rule 16b-3(d), dispositions to the issuer exempted by Rule 
16b-3(e), and Discretionary Transactions pursuant to employee benefit 
plans exempted by Rule 16b-3(f) no longer will be reportable on a 
deferred basis on Form 5, but instead must be reported on Form 4 within 
two business days.\38\ Following these amendments, derivative 
securities transactions reportable on Form 4 will include, without 
limitation, issuances, exercises,\39\ and cancellations and regrants of 
stock options, including repricings.
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    \38\ The amendment does not affect the Rule 16b-3 exemptive 
conditions applicable to these types of transactions, or the 
reporting status of any other transactions addressed by Rule 16a-
3(f)(1).
    \39\ The current requirements of Rule 16a-3(f)(1)(i)(A) to 
report on Form 4 exercises and conversions of derivative securities 
that are exempt from Section 16(b) short-swing profit recovery under 
either Rule 16b-3 or Rule 16b-6(b) [17 CFR 240.16b-6(b)] will 
continue.
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    Like the other amendments we adopt today, the amendments that 
accelerate reporting of reportable Rule 16b-3 exempt transactions apply 
to transactions that occur on or after August 29, 2002.\40\ The 
amendments do not affect such transactions that occur before the 
effective date.
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    \40\ Reporting on Form 5 of other transactions as to which 
deferred reporting is currently available or for which an insider 
failed to file a required report remains available. At their option, 
filing persons may continue to report earlier on Form 4 transactions 
that are reportable on Form 5, as provided by former Rule 16a-
3(g)(2). We redesignate this rule as Rule 16a-3(g)(5) [17 CFR 
240.16a-3(g)(5)] and restate it in plain English.
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    In requiring reporting before the end of the second business day 
following the day on which the transaction is executed, the Act 
provides the Commission rulemaking authority to calculate that deadline 
differently ``in any case in which the Commission determines that such 
2-day period is not feasible.'' If the trade date is considered the 
date of execution, we have determined that filing Form 4 within the 
two-business day deadline would not be feasible for two narrowly 
defined types of transactions where objective criteria prevent the 
reporting person from controlling the trade date.
    The first exception relates to transactions pursuant to Rule 10b5-
1(c) arrangements.\41\ A reporting person generally cannot know whether 
such a transaction will be executed immediately. Where the reporting 
person has not selected the date of execution, the reporting person 
generally knows that an order has been placed, but does not control--
and may not be able reasonably to predict--when the transaction 
actually will occur. Instead, price movement in the market may 
determine the date of execution for these transactions.
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    \41\ Rule 10b5-1 provides that a person trades ``on the basis 
of'' material nonpublic information when the person purchases or 
sells securities while aware of material nonpublic information. 
However, Rule 10b5-1(c) establishes affirmative defenses that permit 
a person to trade in circumstances where it is clear that the 
information was not a factor in the decision to trade. See 
Securities Act Release No. 7881, Exchange Act Release No. 43154 
(Aug. 15, 2000) [65 FR 51716], adopting Rule 10b5-1.
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    The second exception addresses Discretionary Transactions, where 
the logistics of plan administration may prevent a reporting person 
from selecting the date of execution.\42\ A reporting person may not 
reasonably expect a Discretionary Transaction to be executed 
immediately, but instead at a time consistent with the plan's 
particular administrative procedures.
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    \42\ A ``Discretionary Transaction,'' which is defined in Rule 
16b-3(b)(1), involves an intra-plan transfer of previously invested 
assets into or out of a plan issuer securities fund, or a cash-out 
from a plan issuer securities fund.
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    Accordingly, the new rules will define the date of execution 
differently for these transactions, solely for Section 16(a) reporting 
purposes. In light of the Act's purpose to effect immediate disclosure 
of reporting persons' transactions, the alternative calculations we 
adopt for these transactions require expeditious reporting. We are 
modifying the calculation of the statutory two-business day period as 
described below for these transactions:
     For a transaction pursuant to a contract, instruction \43\ 
or written plan for the purchase or sale of issuer equity securities 
that satisfies the affirmative defense conditions of Exchange Act Rule 
10b5-1(c) where the reporting person does not select the date of 
execution, the date on which the executing broker, dealer or plan 
administrator notifies the reporting person of execution of the 
transaction is deemed the date of execution, so long as the 
notification date is not later than the third business day following 
the trade date.\44\
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    \43\ Such an instruction can be in the form of a limit order.
    \44\ Rules 16a-3(g)(2) and 16a-3(g)(4) [17 CFR 240.16a-3(g)(2) 
and 17 CFR 240.16a-3(g)(4)].
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     For a Discretionary Transaction where the reporting person 
does not select the date of execution, the date on which the plan 
administrator notifies the reporting person that the transaction has 
been executed is deemed the date of execution, so long as the 
notification date is not later than the third business day following 
the trade date.\45\
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    \45\ Rules 16a-3(g)(3) and 16a-3(g)(4) [17 CFR 240.16a-3(g)(3) 
and 17 CFR 240.16a-3(g)(4)].
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    In each case, a reporting person must report the transaction on 
Form 4 before the end of the second business day following the deemed 
date of execution, as calculated under the applicable rule, for the 
transaction.\46\ Defining the date of execution as the notification 
date enables a reporting person to report on Form 4 a transaction of 
which he or she otherwise would not have notice. However, neither 
exception will be available if the reporting person has selected the 
date of transaction execution, for example where a Rule 10b5-1(c) 
arrangement provides for a sale on the first business day of each 
month.
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    \46\ As described in Section II.A above, we are adding a column 
to both Tables I and II on Form 4 to report the deemed date of 
execution, so investors and members of the Commission staff reading 
the form will be able to see the applicable date for calculating the 
due date. We are adding the same column to Form 5, so that form will 
provide the same information if the transaction is reported on Form 
5 because the reporting person failed to file the required Form 4.
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    The three-business day period provides reasonable time for 
notification to be made, and is consistent with the Act's purpose to 
expedite reporting. For both Rule 10b5-1(c) transactions and 
Discretionary Transactions, we expect the reporting person will make 
specific arrangements for the broker, dealer or plan administrator to 
provide the reporting person actual notice of transaction execution as 
quickly as

[[Page 56465]]

feasible.\47\ By deeming the notification date to be the third business 
day following the trade date if actual notification does not occur by 
then, the rule limits the potential delay permitted for reporting these 
transactions on a timely basis.\48\
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    \47\ This may require modification of routine procedures, 
particularly with respect to employee benefit plans.
    \48\ Rule 16a-3(g)(4).
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    The broker, dealer or plan administrator may use any means of 
communication, including oral, paper or electronic means, to notify the 
reporting person that the transaction has been executed. While a broker 
or dealer also will have an obligation to provide the reporting person 
with a transaction confirmation under Exchange Act Rule 10b-10,\49\ the 
confirmation may not arrive soon enough to give the reporting person 
the information he or she needs for Section 16(a) reporting purposes. 
For example, a confirmation sent through the mail could take several 
days to arrive. We would, therefore, usually expect brokers and dealers 
to provide the information needed for Section 16(a) reporting purposes 
to the reporting person either electronically or by telephone.\50\
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    \49\ 17 CFR 240.10b-10, which requires broker-dealers to 
disclose specified information in writing to customers at or before 
completion of a transaction.
    \50\ It is possible, however, that an electronic confirmation 
provided to a customer could satisfy the requirements of Rule 10b-10 
as well as notification for Section 16(a) reporting purposes.
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    Regarding Rule 10b5-1(c) transactions, the new rule will be 
available broadly to any transaction that satisfies the affirmative 
defense conditions of Rule 10b5-1(c), including transactions pursuant 
to employee benefit plans and dividend or interest reinvestment plans 
that are not exempt from Section 16(a) reporting. Following 
effectiveness of Section 403 of the Act, acquisitions pursuant to 
Qualified Plans, Excess Benefit Plans, Stock Purchase Plans \51\ and 
the reinvestment of dividends or interest pursuant to broad-based 
dividend or interest reinvestment plans \52\ will remain exempt from 
Section 16(a) reporting. In contrast, transactions pursuant to non-
qualified deferred compensation plans and other dividend or interest 
reinvestment plan transactions (such as acquisitions pursuant to 
voluntary contributions of additional funds) will be reportable on Form 
4 within two business days after the date of execution. However, to the 
extent that such a transaction satisfies the affirmative defense 
conditions of Rule 10b5-1(c), the date of execution for Form 4 
reporting purposes may be calculated on the modified basis.
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    \51\ ``Qualified Plan'' is defined in Rule 16b-3(b)(4). ``Excess 
Benefit Plan'' is defined in Rule 16b-3(b)(2). ``Stock Purchase 
Plan'' is defined in Rule 16b-3(b)(5). Rule 16a-3(f)(1)(i)(B) 
exempts these transactions from Section 16(a) reporting) because 
Rule 16b-3(c) exempts them from Section 16(b) short-swing profit 
recovery.
    \52\ Rule 16a-11 [17 CFR 240.16a-11] exempts these acquisitions 
from Sections 16(a) and 16(b), if the conditions of the rule are 
met.
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III. Electronic Filing and Website Posting

    The Act also amends Section 16(a) to require, not later than one 
year following enactment, electronic filing of change of beneficial 
ownership reports, and website posting of such reports by both the 
Commission and issuers.\53\ We have announced our intention to begin 
rulemaking to make the filing of Section 16(a) reports on EDGAR 
mandatory,\54\ and are proceeding expeditiously with that rulemaking 
and related system programming to assure adoption within the one-year 
period mandated by the Act.
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    \53\ Section 16(a)(4), as amended by the Act.
    \54\ Securities Act Release No. 7803 (Feb. 25, 2000) [65 FR 
11507].
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    Meanwhile, we encourage reporting persons and companies filing 
Section 16(a) reports on their behalf to make these filings 
electronically.\55\ To facilitate EDGAR conversion under the current 
filing system, we will accept electronically-filed Section 16(a) 
reports that are not presented in the standard box format and omit the 
horizontal and vertical lines separating information items, so long as 
the captions of the items and all required information are presented in 
the proper order. Reporting persons who plan to file their Section 
16(a) reports electronically should submit Forms ID requesting EDGAR 
access codes as soon as possible to minimize processing delays.\56\ 
When making a request, please indicate whether the person for whom 
codes are requested is a reporting person with respect to any other 
companies, and whether a CIK number already has been assigned to that 
person. We also encourage companies to post Section 16(a) reports on 
their websites before the July 30, 2003 statutory implementation date.
---------------------------------------------------------------------------

    \55\ For classes of securities listed on the New York Stock 
Exchange, the American Stock Exchange and the Chicago Stock 
Exchange, filing Section 16(a) reports on EDGAR satisfies the 
requirements of Section 16(a)(1) (as amended) and Rule 16a-3(c) to 
file the reports with the exchange on which the securities are 
listed. See staff no-action letters to New York Stock Exchange (Jul. 
22, 1998), American Stock Exchange (Jul. 22, 1998) and Chicago Stock 
Exchange (Jan. 13, 1998).
    \56\ Form ID [17 CFR 239.63] is on our website at (http://www.sec.gov/about/forms/formid.pdf). These forms should be sent by 
facsimile to the Commission at (202) 504-2474 or (703) 914-4240.
---------------------------------------------------------------------------

IV. Request for Comment

    We request comment on the changes we are adopting in this release. 
Are any other technical amendments necessary to implement Section 403 
of the Act? Commenters should address whether the amendments to Rule 
16a-3(g) to define the date of execution differently for specified 
types of transactions will make it feasible for insiders to report 
those transactions within the two-business day deadline. Is any 
additional time necessary to make Form 4 reporting feasible for these 
transactions? Alternatively, do the new rules allow more time than is 
necessary for this purpose?
    Commenters also should address whether any other types of 
transactions require regulatory changes to make it feasible for 
insiders to report them within that deadline. In this regard, what 
factors should we consider in making a feasibility determination?
    On a broader issue not otherwise addressed in this release, we seek 
comment whether any changes are required in the treatment of stock 
options under Sections 16(a) and 16(b). One set of issues involves 
whether and how the six-month period of Section 16(b) should be applied 
and calculated in connection with stock options, exercises and the sale 
of the underlying stock. For example, should a six-month holding period 
be required as a mandatory condition to exempt grants under Rule 16b-
3(d), rather than be one of the alternative permissible bases for an 
exemption?

V. Procedural Matters

    The Administrative Procedure Act generally requires an agency to 
publish notice of a proposed rulemaking in the Federal Register.\57\ 
This requirement does not apply, however, if the agency ``for good 
cause finds * * * that notice and public procedure are impracticable, 
unnecessary, or contrary to the public interest.'' \58\
---------------------------------------------------------------------------

    \57\ See 5 U.S.C. 553(b).
    \58\ Id.
---------------------------------------------------------------------------

    The Commission believes that it is appropriate to adopt the 
amendments to Rules 16a-3 and 16a-6 and Forms 4 and 5 without notice 
and the opportunity for public comment because they are necessary to 
conform the Section 16(a) rules and forms to the two-business day 
reporting deadline provided by the amendments to Section 16(a) enacted 
in Section 403 of the Act that become

[[Page 56466]]

effective, by their terms, on August 29, 2002.\59\
---------------------------------------------------------------------------

    \59\ In the release where we announced that we would consider 
adopting final rules no later than August 29, 2002, we invited 
public comment on the implementation of the legislative provisions 
relating to Section 16(a). Exchange Act Release No. 46313 (Aug. 6, 
2002) [67 FR 51900].
---------------------------------------------------------------------------

    Unless the rule and form amendments become effective by that date, 
reporting persons may be confused by the longer time period currently 
specified by the rules and forms. To satisfy the Act's purpose to 
require immediate disclosure of insider transactions, some of the 
amendments eliminate deferred reporting of officers' and directors' 
reportable transactions with an issuer exempted from short-swing profit 
recovery by Rule 16b-3.\60\ Without these regulatory amendments, the 
statutory amendments will become effective without fulfilling their 
purpose.
---------------------------------------------------------------------------

    \60\ We previously solicited comment on this regulatory action 
in ``Form 8-K Disclosure of Certain Management Transactions,'' 
Securities Act Release No. 8090, Exchange Act Release No. 45742 
(Apr. 12, 2002) [67 FR 19914, at 19920].
---------------------------------------------------------------------------

    The amendments to Rule 16a-3(g) implement specific rulemaking 
authority granted to the Commission by Section 403 of the Act to 
compute the two-business day deadline differently in certain narrowly-
defined circumstances, based on feasibility. We do not believe Congress 
intended to require reporting persons to report transactions for which 
they had no opportunity to obtain notice of execution. Without these 
regulatory amendments, the statutory amendments will become effective 
in a manner that is not feasible for these transactions.
    The technical amendments to Rule 16a-8(a)(1) implement amendments 
we previously adopted to provide that a trust is subject to Section 16 
only if the trust is a more than ten percent beneficial owner.\61\ The 
technical amendments to the General Instructions to Forms 3, 4 and 5 to 
omit references to furnishing the Social Security Numbers of natural 
persons implement a policy that we previously adopted.\62\
---------------------------------------------------------------------------

    \61\ Exchange Act Release No. 37260 (Jun. 14, 1996) [61 FR 
30392].
    \62\ Securities Act Release No. 7424 (Jun. 25, 1997) [62 FR 
35338].
---------------------------------------------------------------------------

    Accordingly, the Commission for good cause finds that a notice and 
comment period for these rules would be unnecessary, impracticable and 
contrary to the public interest.
    The Administrative Procedure Act also generally requires that an 
agency publish an adopted rule in the Federal Register 30 days before 
it becomes effective.\63\ This requirement, however, does not apply if 
the agency finds good cause for making the rule effective sooner.\64\ 
For the same reasons as it is waiving notice and comment, the 
Commission finds good cause to make the rules effective August 29, 
2002.\65\ In addition, the amendments to Rule 16a-3(g) relieve a 
restriction.
---------------------------------------------------------------------------

    \63\ See 5 U.S.C. 553(d).
    \64\ Id.
    \65\ This finding also satisfies the requirements of 5 U.S.C. 
808(2), allowing the rules to become immediately effective 
notwithstanding the requirements of 5 U.S.C. Sec. 801 (if the agency 
finds that notice and public procedure are ``impractical, 
unnecessary, or contrary to the public interest,'' the rule ``shall 
take effect at such time as the Federal agency promulgating the rule 
determines'').
---------------------------------------------------------------------------

VI. Paperwork Reduction Act

    We already have control numbers for Forms 3 (OMB Control No. 3235-
0104), 4 (OMB Control No. 3235-0287) and 5 (OMB Control No. 3235-0362). 
These forms prescribe beneficial ownership information that a reporting 
person must disclose. Preparing and filing a report on any of these 
forms is a collection of information. Consistent with the will of 
Congress, the amendments conform the Section 16(a) rules and forms to 
the two-business day reporting deadline provided by the amendments to 
Section 16(a) enacted in Section 403 of the Act.
    Following the amendments adopted today, reporting persons will 
remain obligated to disclose the same information that they were 
previously required to report on these forms.\66\ Some transactions 
previously reported on Form 5 instead will be reported on Form 4. 
Because of the expedited filing deadline, reporting persons may file 
Forms 4 more frequently, but each form would report fewer transactions. 
We therefore believe that the overall information collection burden 
will remain approximately the same because the same transactions will 
remain reportable.
---------------------------------------------------------------------------

    \66\ The addition of a column on each table--which requires only 
a date and will be used only for certain narrowly-defined 
transactions--is a de minimis change.
---------------------------------------------------------------------------

VII. Costs and Benefits

    The action that the Commission takes today largely represents the 
implementation of a Congressional mandate. We recognize that 
implementation of the Act will likely create costs and benefits to the 
economy. Costs may arise because reporting persons will be required to 
file Form 4 significantly more quickly after a transaction, and 
potentially more frequently because Form 4 no longer will be a monthly 
form. The increased speed of filing also may increase preparation 
costs. In addition, to the extent that amended Section 16(a) results in 
an increase in the number of Forms 4 filed--although the total number 
of reportable transactions has not been changed by Section 403 of the 
Act or this release--the aggregate cost of providing this information 
may increase.
    Conversely, amended Section 16(a) is likely to provide significant 
benefits by making information concerning insiders' transactions in 
issuer equity securities publicly available substantially sooner than 
it was before. Making this information available to all investors on a 
more timely basis should increase market transparency, which will 
likely enhance market efficiency and liquidity.
    In adopting specific rules for transactions for which we have 
determined that filing Form 4 within the statutory two-business day 
deadline otherwise would not be feasible, we have considered the 
associated costs and benefits. The reporting rules that we adopt for 
these transactions generally involve instances where the reporting 
person does not control and cannot reasonably be expected to know 
immediately the precise transaction date. The rules therefore allow 
reasonable additional time so that reporting is feasible, while 
requiring expeditious reporting consistent with the Act's purpose to 
effect immediate disclosure of reporting persons' transactions.

VIII. Promotion of Efficiency, Competition and Capital Formation

    Section 23(a)(2) of the Exchange Act \67\ requires us, when 
adopting rules under the Exchange Act, to consider the anti-competitive 
effective of any rules we adopt. Further, Section 3(f) of the Exchange 
Act \68\ and Section 2(c) of the Investment Company Act \69\ require 
us, when engaging in rulemaking where we are required to consider or 
determine whether an action is necessary or appropriate in the public 
interest, to consider, in addition to the protection of investors, 
whether the action will promote efficiency, competition and capital 
formation.
---------------------------------------------------------------------------

    \67\ 15 U.S.C. 78w(a)(2).
    \68\ 15 U.S.C. 78c(f).
    \69\ 15 U.S.C. 80a-2(c).
---------------------------------------------------------------------------

    The amendments generally implement a statute that improves the 
timeliness of information available to investors about insiders' 
transactions in issuer equity securities. We are adopting rules to 
provide certain different calculations for the two-business day 
standard set by Congress. These rules should have no effect on 
competition and capital formation. They are

[[Page 56467]]

designed to increase the efficiency of insider reporting.

IX. Regulatory Flexibility Act

    The Regulatory Flexibility Act \70\ does not apply to the rules we 
adopt today. The Regulatory Flexibility Act requires agencies to 
prepare analyses for rulemaking only when the Administrative Procedure 
Act requires general notice of proposed rulemaking.\71\ As noted above, 
the Commission is not required to solicit public comment because the 
Commission is using the expedited rulemaking procedures under section 
553(b) of the Administrative Procedure Act.\72\
---------------------------------------------------------------------------

    \70\ 5 U.S.C. 601-612.
    \71\ 5 U.S.C. 603(a).
    \72\ See Section V, above.
---------------------------------------------------------------------------

X. Statutory Authority

    The amendments contained in this release are adopted under the 
authority set forth in Sections 3(b),\73\ 16 and 23(a) \74\ of the 
Exchange Act, Section 17(a) of the Public Utility Holding Company Act 
of 1934,\75\ Section 30(h) of the Investment Company Act of 1940, and 
Section 3(a) of the Sarbanes-Oxley Act of 2002.
---------------------------------------------------------------------------

    \73\ 15 U.S.C. 78c(b).
    \74\ 15 U.S.C. 78w(a).
    \75\ 15 U.S.C. 79q(a).
---------------------------------------------------------------------------

Text of Amendments

List of Subjects in 17 CFR Parts 240, 249 and 274

    Securities.


    In accordance with the foregoing, Title 17, Chapter II of the Code 
of Federal Regulations is amended as follows:

PART 240--GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 
1934

    1. The authority citation for Part 240 continues to read, in part, 
as follows:

    Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 
77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 
78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 
78w, 78x, 78ll, 78mm, 79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-
3, 80b-4 and 80b-11, unless otherwise noted.


    2. Section 240.16a-3 is amended by revising paragraphs (f)(1)(i)(A) 
and (g), to read as follows:


Sec. 240.16a-3  Reporting transactions and holdings.

* * * * *
    (f)(1) * * *
    (i) * * *
    (A) Exercises and conversions of derivative securities exempt under 
either Sec. 240.16b-3 or Sec. 240.16b-6(b), and any transaction exempt 
under Sec. 240.16b-3(d), Sec. 240.16b-3(e), or Sec. 240.16b-3(f) (these 
are required to be reported on Form 4);
* * * * *
    (g)(1) A Form 4 must be filed to report: All transactions not 
exempt from section 16(b) of the Act; All transactions exempt from 
section 16(b) of the Act pursuant to Sec. 240.16b-3(d), Sec. 240.16b-
3(e), or Sec. 240.16b-3(f); and all exercises and conversions of 
derivative securities, regardless of whether exempt from section 16(b) 
of the Act. Form 4 must be filed before the end of the second business 
day following the day on which the subject transaction has been 
executed.
    (2) Solely for purposes of section 16(a)(2)(C) of the Act and 
paragraph (g)(1) of this section, the date on which the executing 
broker, dealer or plan administrator notifies the reporting person of 
the execution of the transaction is deemed the date of execution for a 
transaction where the following conditions are satisfied:
    (i) the transaction is pursuant to a contract, instruction or 
written plan for the purchase or sale of equity securities of the 
issuer (as defined in Sec. 16a-1(d)) that satisfies the affirmative 
defense conditions of Sec. 240.10b5-1(c) of this chapter; and
    (ii) the reporting person does not select the date of execution.
    (3) Solely for purposes of section 16(a)(2)(C) of the Act and 
paragraph (g)(1) of this section, the date on which the plan 
administrator notifies the reporting person that the transaction has 
been executed is deemed the date of execution for a discretionary 
transaction (as defined in Sec. 16b-3(b)(1)) for which the reporting 
person does not select the date of execution.
    (4) In the case of the transactions described in paragraphs (g)(2) 
and (g)(3) of this section, if the notification date is later than the 
third business day following the trade date of the transaction, the 
date of execution is deemed to be the third business day following the 
trade date of the transaction.
    (5) At the option of the reporting person, transactions that are 
reportable on Form 5 may be reported on Form 4, so long as the Form 4 
is filed no later than the due date of the Form 5 on which the 
transaction is otherwise required to be reported.
* * * * *

    3. Section 240.16a-6 is amended by revising paragraph (a) 
introductory text and paragraph (b) to read as follows:


Sec. 240.16a-6  Small acquisitions.

    (a) Any acquisition of an equity security or the right to acquire 
such securities, other than an acquisition from the issuer (including 
an employee benefit plan sponsored by the issuer), not exceeding 
$10,000 in market value shall be reported on Form 5, subject to the 
following conditions:
* * * * *
    (b) If an acquisition no longer qualifies for the reporting 
deferral in paragraph (a) of this section, all such acquisitions that 
have not yet been reported must be reported on Form 4 before the end of 
the second business day following the day on which the conditions of 
paragraph (a) of this section are no longer met.

    4. Section 240.16a-8 is amended by revising paragraph (a)(1) to 
read as follows:


Sec. 240.16a-8  Trusts.

    (a) Persons subject to section 16. (1) Trusts. A trust shall be 
subject to section 16 of the Act with respect to securities of the 
issuer if the trust is a beneficial owner, pursuant to Sec. 240.16a-
1(a)(1), of more than ten percent of any class of equity securities of 
the issuer registered pursuant to section 12 of the Act (``ten percent 
beneficial owner'').
* * * * *

PART 249--FORMS, SECURITIES EXCHANGE ACT OF 1934

    5. The authority citation for Part 249 continues to read, in part, 
as follows:

    Authority: 15 U.S.C. 78a, et seq., unless otherwise noted.
* * * * *

PART 274--FORMS PRESCRIBED UNDER THE INVESTMENT COMPANY ACT OF 1940

    6. The authority citation for Part 274 continues to read as 
follows:

    Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 78c(b), 78l, 78m, 
78n, 78o(d), 80a-8, 80a-24, 80a-26, and 80a-29, unless otherwise 
noted.

    7. Form 3 (referenced in Sec. 249.103 and Sec. 274.202) and the 
General Instructions thereto are amended by revising the fourth 
sentence of paragraph (b)(v) of General Instruction 5, to read as 
follows:

    Note-- The text of Form 3 does not and this amendment will not 
appear in the Code of Federal Regulations.

Form 3--Initial Statement of Beneficial Ownership of Securities

* * * * *

General Instructions

* * * * *

[[Page 56468]]

5. Holdings Required To Be Reported

* * * * *

(b) Beneficial Ownership Reported (Pecuniary Interest)

* * * * *
    (v) * * * Indicate only the name and address of the designated 
filer in Item 1 of Form 3 and attach a list of the names and 
addresses (or, if entities, IRS identification numbers instead of 
addresses) of each other reporting person. * * *
* * * * *
    8. Form 4 (referenced in Sec. 249.104 and Sec. 274.203) and the 
General Instructions thereto are amended by:
    a. Revising the first sentence of General Instruction 1(a);
    b. Revising General Instructions 3(a)(i), 3(a)(ii) and 3(a)(iii);
    c. Revising General Instruction 4(a)(i) and the first sentence of 
the Note thereto;
    d. Adding a sentence at the end of General Instruction 4(a)(ii) 
before the Note thereto;
    e. Revising the fourth sentence of General Instruction 4(b)(v); and 
revising Items 4 and 5 to the information preceding Table I;
    f. Adding column 2A to follow column 2 in Table I;
    g. Revising column 5 in Table I;
    h. Adding column 3A to follow column 3 in Table II; and
    i. Revising column 9 in Table II.
    The revisions read as follows:


    Note-- The text of Form 4 does not and this amendment will not 
appear in the Code of Federal Regulations.

Form 4--Statement of Changes in Beneficial Ownership of Securities

* * * * *

General Instructions

1. When Form Must Be Filed

    (a) This Form must be filed before the end of the second 
business day following the day on which a transaction resulting in a 
change in beneficial ownership has been executed (see Rule 16a-
1(a)(2) and Instruction 4 regarding the meaning of ``beneficial 
owner,'' and Rule 16a-3(g) regarding determination of the date of 
execution for specified transactions). * * *
* * * * *

3. Class of Securities Reported

    (a) (i) Persons reporting pursuant to Section 16(a) of the 
Exchange Act must report each transaction resulting in a change in 
beneficial ownership of any class of equity securities of the issuer 
and the beneficial ownership of that class of securities following 
the reported transaction(s), even though one or more of such classes 
may not be registered pursuant to Section 12 of the Exchange Act.
    (ii) Persons reporting pursuant to Section 17(a) of the Public 
Utility Holding Company Act of 1935 must report each transaction 
resulting in a change in beneficial ownership of any class of 
securities (equity or debt) of the registered holding company and 
all of its subsidiary companies and the beneficial ownership of that 
class of securities following the reported transaction(s). Specify 
the name of the parent or subsidiary issuing the securities.
    (iii) Persons reporting pursuant to Section 30(h) of the 
Investment Company Act of 1940 must report each transaction 
resulting in a change in beneficial ownership of any class of 
securities (equity or debt) of the registered closed-end investment 
company (other than ``short-term paper'' as defined in Section 
2(a)(38) of the Investment Company Act) and the beneficial ownership 
of that class of securities following the reported transaction(s).
* * * * *

4. Transactions and Holdings Required To Be Reported

    (a) General Requirements
    (i) Report, in accordance with Rule 16a-3(g): (1) all 
transactions not exempt from Section 16(b); (2) all transactions 
exempt from Section 16(b) pursuant to Sec. 240.16b-3(d), 
Sec. 240.16b-3(e), or Sec. 240.16b-3(f); and (3) all exercises and 
conversions of derivative securities, regardless of whether exempt 
from Section 16(b) of the Act. Every transaction must be reported 
even though acquisitions and dispositions are equal. Report total 
beneficial ownership following the reported transaction(s) for each 
class of securities in which a transaction was reported.

    Note: The amount of securities beneficially owned following the 
reported transaction(s) specified in Column 5 of Table I and Column 
9 of Table II should reflect holdings reported or required to be 
reported by the date of the Form. * * *

    (ii) * * * A deemed execution date must be reported in Column 2A 
of Table I or Column 3A of Table II only if the execution date for 
the transaction is calculated pursuant to Sec. 240.16a-3(g)(2) or 
Sec. 240.16a-3(g)(3).
* * * * *

(b) Beneficial Ownership Reported (Pecuniary Interest)

* * * * *
    (v) * * * Indicate only the name and address of the designated 
filer in Item 1 of Form 4 and attach a list of the names and 
addresses (or, if entities, IRS identification numbers instead of 
addresses) of each other reporting person. * * *
* * * * *

Form 4

* * * * *

4. Statement for Month/Day/Year

5. If Amendment, Date of Original (Month/Day/Year)

* * * * *

Table I.--Non-Derivative Securities Acquired, Disposed of, or 
Beneficially Owned

* * * * *

2A. Deemed Execution Date, If Any (Month/Day/Year)

* * * * *

5. Amount of Securities Beneficially Owned Following Reported 
Transaction(s)

* * * * *

Table II--Derivative Securities Acquired, Disposed of, or Beneficially 
Owned (e.g., puts, calls, warrants, options, convertible securities)

* * * * *

3A. Deemed Execution Date, if any (Month/Day/Year)

* * * * *

9. Number of Derivative Securities Beneficially Owned Following 
Reported Transaction(s)

* * * * *
    9. Form 5 (referenced in Sec. 249.105) and the General Instructions 
thereto are amended by:
    a. Revising General Instruction 4(a)(i)(A);
    b. Adding a sentence at the end of General Instruction 4(a)(ii);
    c. Revising the fourth sentence of General Instruction 4(b)(v);
    d. Adding column 2A to follow column 2 in Table I; and
    e. Adding column 3A to follow column 3 in Table II.
    The revisions read as follows:


    Note-- The text of Form 5 does not and this amendment will not 
appear in the Code of Federal Regulations.

Form 5--Annual Statement of Beneficial Ownership of Securities

* * * * *

4. Transactions and Holdings Required To Be Reported

(a) General Requirements

    (i) * * *
    (A) Any transaction during the issuer's most recent fiscal year 
that was exempt from Section 16(b) of the Act, except: (1) any 
transaction exempt from Section 16(b) pursuant to Sec. 240.16b-3(d), 
Sec. 240.16b-3(e), or Sec. 240.16b-3(f) (these are required to be 
reported on Form 4); (2) any exercise or conversion of derivative 
securities exempt under either Sec. 240.16b-3 or Sec. 240.16b-6(b) 
(these are required to be reported on Form 4); (3) any transaction 
exempt from Section 16(b) of the Act pursuant to Sec. 240.16b-3(c), 
which is exempt from Section 16(a) of the Act; and (4) any 
transaction exempt from Section 16 of the Act pursuant to another 
Section 16(a) rule;
* * * * *
    (ii) * * * A deemed execution date must be reported in Column 2A 
of Table I or Column 3A of Table II only if the execution date for 
the transaction is calculated pursuant to Sec. 240.16a-3(g)(2) or 
Sec. 240.16a-3(g)(3).
* * * * *

[[Page 56469]]

(b) Beneficial Ownership Reported (Pecuniary Interest)

* * * * *
    (v) * * * Indicate only the name and address of the designated 
filer in Item 1 of Form 5 and attach a list of the names and 
addresses (or, if entities, IRS identification numbers instead of 
addresses) of each other reporting person. * * *
* * * * *

Form 5

* * * * *

Table I.--Non-Derivative Securities Acquired, Disposed of, or 
Beneficially Owned

* * * * *

2A. Deemed Execution Date, if any (Month/Day/Year)

* * * * *

Table II.--Derivative Securities Acquired, Disposed of, or Beneficially 
Owned (e.g., puts, calls, warrants, options, convertible securities)

* * * * *

3A. Deemed Execution Date, if any (Month/Day/Year)

* * * * *

    Dated: August 27, 2002.

    By the Commission.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 02-22301 Filed 8-28-02; 3:03 pm]
BILLING CODE 8010-01-P