SEC Votes To Mandate Electronic Filing of Ownership Reports; Prohibit Improper Influence of Auditors

FOR IMMEDIATE RELEASE 2003-51

Washington, D.C., April 24, 2003 - The Securities and Exchange Commission today voted to require that reports by insiders disclosing their securities holdings be filed electronically with the SEC. The Commission also voted to adopt rules prohibiting company officials from improperly influencing auditors of financial statements.

1. The Commission voted to mandate the electronic filing of beneficial ownership reports filed by officers, directors and principal security holders under Section 16(a) of the Securities Exchange Act of 1934, and to require issuers with corporate websites to post these reports. Electronic filing and website posting of these reports will result in earlier public notification of insiders' transactions and wider public availability of information about those transactions. The new rules and amendments implement the requirements of Section 16(a)(4), as amended by Section 403 of the Sarbanes-Oxley Act of 2002.

Under the new rules and amendments:

• Mandated electronic filing will apply to Forms 3, 4 and 5. To facilitate this, a new on-line filing system for these forms has been created.

• Forms 3, 4 and 5 submitted by direct transmission on or before 10 p.m. Eastern time will be deemed filed on the same business day. In light of these extended filing hours, temporary hardship exemptions will not be available for these forms.

• An issuer that maintains a corporate website will be required to post on that website all Forms 3, 4 and 5 filed with respect to its equity securities by the end of the business day after filing. An issuer will be able to satisfy this requirement by providing direct access, or by hyperlinking to a third-party website (such as EDGAR) if certain conditions are satisfied.

In addition, the new rule amendments will eliminate magnetic cartridges as a means of filing any form electronically.

These new rules and amendments will become effective on June 30, 2003.

2. The Commission adopted amendments to Regulation 13B2 that implement Section 303 of the Sarbanes-Oxley Act of 2002. The new rules prohibit officers and directors of an issuer, and persons acting under the direction of an officer or director, from coercing, manipulating, misleading, or fraudulently influencing the auditor of the issuer's financial statements if that person knew or should have known that such action could render the financial statements materially misleading.

These amendments will be effective thirty days after their publication in the Federal Register.

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The full text of the adopting release for the new rules and amendments will be posted on the SEC website as soon as possible.