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Why do you gloss over everything posted and make a generic statement like that?
http://amigaworld.net/modules/newbb/viewtopic.php?topic_id=30303&forum=2&start=120&viewmode=flat&order=0#738760
If there are judgements against Amiga Inc with more coming, don't you think it would be illegal to play a shell game to transfer assets from a newly formed Amiga Games Inc (formed out of thin air to transfer assets from Amiga Inc to WRIT)? It would be quickly clawed back and/or WRIT be sued for damages.
That is if anything was ever really transferred to begin with. According to that Blackberry link I provided,Amiga Inc is still listed as owner with no mention of WRIT.
Amiga sued yet again.
http://dockets.justia.com/docket/washington/wawdce/2:2012mc00203/187600
They are sued and some months later out of nowhere they create a new company called Amiga Games Inc to supposedly sell game IP to Writer's Group? You can guarantee that Writer's Group will be added to the lawsuit, if they haven't already. Heck, Amiga Inc is still listed as owner to this very day.
http://appworld.blackberry.com/webstore/vendor/21741/?lang=en
I don't think Amiga Inc will survive this one and Writer's Group will go down with Amiga Inc.
I've sent multiple emails and called but no response.
No one answers the phones at DNA. I'm a shareholder and think they have good product, but sometimes i wonder about these guys. They claim to be in stores in Florida but they don't answer the phone and don't answer emails. As a matter of fact, when trying to reach customer service/sales the phone is forwarded to some 700 area code number with a generic voice mail message.
http://en.wikipedia.org/wiki/Area_code_700
Now I'm wishing I would have picked up some 0.0011s :-/
Showing great strength!
Today's action will be telling. We need a white candle, or no worse than a doji.
Relentless buying!!! Hostile takeover by RC Cola?!?!?
Cover now!! Don't lose your house!!!
WOW!! Fake *BID* !!! That is rare to see!! Someone BIG is loading huge!!! Cancel all sell orders!!!
Can we hit 0.006-0.007 today? Realistic target!!
RC Cola buyout?
007s and double volume at least tomorrow! Nice rebound!!!
A solid PR would easily bump this to 1-2 penny in a heartbeat.
Finally some good news from this POS! Now if we get a solid PR in the next day or so, we'll be cooking with grease!
Name one store in South Florida that has DNA in stock? I've visited literally dozens of RaceTrac and Walgreens with no luck. I've asked the company directly and they ignore my inquiries.
They claim to be in stores in Florida. I know they used to be as I've seen it, but I don't see it any more and they won't reply to emails.
Driving by a publicly traded company's world headquarters is stalking?
The van hasn't moved in weeks.
http://tinypic.com/view.php?pic=2a6t9pd&s=8
It is covered in dust/dirt and the window stickers are peeling off. They are not using this van for local deliveries or anything else.
I guess our esteemed CEO was in today.
http://tinypic.com/view.php?pic=14tahx0&s=8
There is a DNA sticker on this van.
Wow dilution solution in full swing lately!!! DNA just keeps hitting the dump button!
Sad.
I aint buying another share of this SCAM until they show me something other than fluff! I need Walmart or Costco news.
I might as well let my position go to zero. What a scam! What the hell was I thinking given the terrible track record? Not even worth a flip, going to straight dive to the basement of no bid/0.0001.
That is the only contact us email address on their website!
I'm not sure they are still in South Florida stores. I've check a dozen or so Walgreens and Racetrac location with no luck. I sent an email to efowler@dnaenergydrink.com asking where to find them in stock in Broward County with no response.
I'm way down on my position here and not going to buy any more at this point as this is starting to get the odor of a share selling scam.
Hmm, when's the next 10Q due. Must look.
Fluff & pump? What are you smoking?
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=104216060
I don't think Jake Shapiro can avoid prison this time.
Wow what a POS!!! New all time lows. I'm feeling like a real sucker for buying in on the last pop.
I guess I'll be averaging down over the next few weeks until the next pop.
Was too easy to predict.
Easy, it will open on the "grey market" with no bid or ask. The PPS will collapse to the mid-lower 0.000s and close near the basement of 0.0001. Within a few trading days it will have no bid and no volume with the PPS stuck at 0.0001.
Exactly as predicted. It will get worse from here.
Indeed. Anyone who doesn't think this will tank tomorrow is either fooling themselves or just completely delusional.
Easy, it will open on the "grey market" with no bid or ask. The PPS will collapse to the mid-lower 0.000s and close near the basement of 0.0001. Within a few trading days it will have no bid and no volume with the PPS stuck at 0.0001.
LOL! The O/S is 400% *HIGHER* than last updated on May 16, 2014! Someone is going to prison!
An SEC Halt is a reportable event and MDNT has failed to disclose this to shareholders, digging their grave even deeper.
http://www.sec.gov/rules/final/33-8400.htm
Final Rule:
Additional Form 8-K Disclosure Requirements
and Acceleration of Filing Date
SECURITIES AND EXCHANGE COMMISSION
17 CFR PARTS 228, 229, 230, 239, 240 and 249
[RELEASE NOS. 33-8400; 34-49424; File No. S7-22-02]
RIN 3235-AI47
ADDITIONAL FORM 8-K DISCLOSURE REQUIREMENTS AND ACCELERATION OF FILING DATE
AGENCY: Securities and Exchange Commission.
Action: Final rule.
Summary: We are expanding the number of events that are reportable on Form 8-K under the Securities Exchange Act of 1934. These amendments add eight new items to the form, transfer two items from the periodic reports and expand disclosures under two existing Form 8-K items. Due to the increase in reportable events under the form, we are reorganizing the Form 8-K items into topical categories. The amendments also shorten the Form 8-K filing deadline for most items to four business days after the occurrence of an event triggering the disclosure requirements of the form. Finally, we are adopting a limited safe harbor from liability for failure to file certain of the required Form 8-K reports. These amendments are responsive to the "real time issuer disclosure" mandate in Section 409 of the Sarbanes-Oxley Act of 2002. They are intended to provide investors with better and faster disclosure of important corporate events.
Effective Date: August 23, 2004.
For Further Information Contact: Ray Be, Special Counsel, or Julie A. Bell, Special Counsel, each at (202) 942-2910, Division of Corporation Finance, U.S. Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0312.
Supplementary Information: We are adopting amendments to Form 8-K,1 Form 10-K,2 Form 10-KSB,3 Form 10-Q,4 Form 10-QSB,5 Rule 12b-23,6 Rule 13a-10,7 Rule 13a-11,8 Rule 15d-10,9 and Rule 15d-1110 under the Securities Exchange Act of 1934,11 Form S-212, Form S-313 and Rule 14414 under the Securities Act of 1933,15 and Item 60116 of Regulation S-B17 and Item 60118 of Regulation S-K.19
Table of Contents
I. Background
II. Discussion of Amendments
A. Shortened Form 8-K Filing Deadline and Availability of Form 12b-25
B Reorganization of Form 8-K Items
C. Expansion of Form 8-K Items
1. Item 1.01 Entry into a Material Definitive Agreement
a. Filing of Exhibits
b. Considerations Regarding Business Combinations
2. Item 1.02 Termination of a Material Definitive Agreement
3. Item 1.03 Bankruptcy or Receivership
4. Item 2.01 Completion of Acquisition or Disposition of Assets
5. Item 2.02 Results of Operations and Financial Condition
6. Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant
7. Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
8. Item 2.05 Costs Associated with Exit or Disposal Activities
9. Item 2.06 Material Impairments
10. Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
11. Item 3.02 Unregistered Sales of Equity Securities
12. Item 3.03 Material Modifications to Rights of Security Holders
13. Item 4.01 Changes in Registrant's Certifying Accountant
14. Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
15. Item 5.01 Changes in Control of Registrant
16. Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
a. Disclosure under Item 5.02(a) when a director resigns or refuses to stand for re-election due to a disagreement or is removed for cause
b. Disclosure under Item 5.02(b) when certain officers retire, resign or are terminated and disclosure when a director retires, resigns, is removed or refuses to stand for re-election for any reason other than as a result of a disagreement or for cause
c. Disclosure under Item 5.02(c) and (d) when the registrant appoints certain new officers or a new director is elected
17. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
D. Proposed Form 8-K Items Not Being Adopted
E. Safe Harbor and Eligibility to Use Forms S-2 and S-3 and to Rely on Rule 144
F. Other Matters Related to Form 8-K Filings and Conforming Amendments
1. Events Falling under Multiple Items
2. Amendments to Item 601 of Regulation S-K and Regulation S-B
3. Clarification of Filing Status of Exhibits
4. Revisions to Forms 10-Q, 10-QSB, 10-K and 10-KSB
5. Certification under Section 906 of the Sarbanes-Oxley Act of 2002
6. Other Conforming Amendments
III. Paperwork Reduction Act
IV. Costs and Benefits
V. Effect on Efficiency, Competition and Capital Formation
VI. Final Regulatory Flexibility Analysis
VII. Statutory Basis and Text of Rule Amendments
I. Background
On June 17, 2002, we proposed to increase the number of events required to be disclosed on Form 8-K.20 Form 8-K is the Exchange Act form for current reports. Prior to the amendments being adopted today, Form 8-K required disclosure regarding nine different specified events.21 At the time, the proposals would have increased the number of reportable events under the form to 22. The proposals also would have shortened the form's filing deadline from five business days or 15 calendar days, depending on the particular event, to two business days with an automatic two business day extension upon a company's filing of a Form 12b-25. In response to these proposals, we received approximately 85 comment letters from various constituencies, including investors, issuers, accounting firms, law firms and associations representing the interests of such constituencies.
Under the previous Form 8-K regime, companies were required to report very few significant corporate events. The limited number of Form 8-K disclosure items permitted a public company to delay disclosure of many significant events until the due date for its next periodic report. During such a delay, the market was unable to assimilate such undisclosed information into the value of a company's securities. The revisions that we adopt today will benefit markets by increasing the number of unquestionably or presumptively material events that must be disclosed currently. They will also provide investors with better and more timely disclosure of important corporate events.
On July 29, 2002, Congress enacted the Sarbanes-Oxley Act of 2002.22 Section 409 of this Act requires public companies to disclose "on a rapid and current basis" material information regarding changes in a company's financial condition or operations as we, by rule, determine to be necessary or useful for the protection of investors and in the public interest. These amendments also further the goals of Section 409 of the Sarbanes-Oxley Act.
At the same time, we have taken into account a number of important comments on the proposals by adopting a modified version of the proposed Form 8-K amendments. We have addressed the commenters' concern regarding potential premature disclosure in a number of respects. We also have addressed the concerns raised by several commenters regarding the length of the Form 8-K filing period by extending it beyond the originally proposed two business day period and significantly reducing the amount of analysis required by the specific items of the form. Our general rules, however, prohibiting material omissions that make the contents of the disclosure misleading, of course, continue to apply.23 We have also taken into account the concerns expressed by commenters regarding the liabilities that could arise for failure to make current disclosure of some events in what are still tight timeframes. In response to these comments, we have replaced the proposed safe harbor that would have afforded protection from potential Exchange Act Section 13(a) or 15(d) liability stemming from a company's failure to file a required Form 8-K to instead afford protection from potential liability arising under Exchange Act Section 10(b) and Rule 10b-5 thereunder.
II. Discussion of Amendments
A. Shortened Form 8-K Filing Deadline and Availability of Form 12b-25
The amendments to Form 8-K require issuers that are subject to the reporting requirements of Section 13(a) and Section 15(d) of the Exchange Act, other than foreign private issuers that file annual reports on Form 20-F24 or 40-F,25 to file required current reports on Form 8-K within four business days of a triggering event.26 These amendments do not affect the filing deadline for disclosures under Regulation FD (Item 7.01), voluntary disclosures (Item 8.01) and certain exhibits.
In the proposing release, we proposed a two business day deadline for Form 8-K, with provision for an automatic two business day extension upon a company's filing of Form 12b-25. Thus, the proposals would have permitted a four business day filing period whenever a company filed a Form 12b-25.
We received numerous comments and recommendations regarding appropriate filing deadlines.27 The comments ranged from support of the two business day deadline to recommendations of as much as ten business days. Similarly, we received mixed comments on the Form 12b-25 proposal.28 Some commenters noted that the Form 12b-25 proposal would complicate the process and that increased filings would reduce the significance of a Form 12b-25 filing.29 We are persuaded by these commenters that modifications to the proposals are warranted. Thus, we are not adopting the proposal to extend the Form 8-K filing deadline via Form 12b-25. Rather, we are adopting a four business day deadline for Form 8-K, with no provision for extension under Rule 12b-25.30 We believe that this change addresses commenters' concerns regarding the sufficiency of the filing period and simplifies the logistics of filing the four business day period.
B. Reorganization of Form 8-K Items
Because we are adding a number of new items to the form, we believe it is appropriate to organize the required reportable items into topical categories. Commenters generally supported such reorganization. The amendments organize the Form 8-K items under the following section headings and with the following new numbering system:
Section 1 - Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement
Item 1.02 Termination of a Material Definitive Agreement
Item 1.03 Bankruptcy or Receivership
Section 2 - Financial Information
Item 2.01 Completion of Acquisition or Disposition of Assets
Item 2.02 Results of Operations and Financial Condition
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Item 2.05 Costs Associated with Exit or Disposal Activities
Item 2.06 Material Impairments
Section 3 - Securities and Trading Markets
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
Item 3.02 Unregistered Sales of Equity Securities
Item 3.03 Material Modifications to Rights of Security Holders
Section 4 - Matters Related to Accountants and Financial Statements
Item 4.01 Changes in Registrant's Certifying Accountant
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
Section 5 - Corporate Governance and Management
Item 5.01 Changes in Control of Registrant
Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
Item 5.04 Temporary Suspension of Trading Under Registrant's Employee Benefit Plans
Item 5.05 Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics
Section 6 - [Reserved]
Section 7 - Regulation FD
Item 7.01 Regulation FD Disclosure
Section 8 - Other Events
Item 8.01 Other Events
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits
This new numbering system avoids re-use of the former single-digit item numbering system previously used in Form 8-K to avoid confusion about the subject of particular items. For example, the Form 8-K item permitting voluntary disclosure of "other events" that was formerly designated as Item 5 now appears as Item 8.01. Thus, anyone searching the EDGAR database for such filings made before and after the change will need to search for both Items 5 and 8.01. In addition, a company amending a Form 8-K that it filed before the effective date of the rules we are adopting today must file the amendment using the form's new numbering system. For example, a company amending a Form 8-K previously filed under former Item 2, Acquisition or Disposition of Assets, to add the required financial statements must reference new Item 9.01, Financial Statements and Exhibits, when filing the amendment.
C. Expansion of Form 8-K Items
We are adding eight new items to the list of events that require a company to file a current report on Form 8-K and transferring, in part, two items from the periodic reports.31 In addition, we are expanding two pre-existing Form 8-K items. Based on our review of Form 8-K filings, as well as public comment letters, we believe that these items represent events that unquestionably or presumptively have such significance that current disclosure should be required. These amendments will operate prospectively only.32 The following is a discussion of the individual items in the revised Form 8-K.
Section 1 - Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
New Item 1.01 requires the disclosure of material definitive agreements entered into by a company that are not made in the ordinary course of business. The item parallels Items 601(b)(10) of Regulation S-K33 with regard to the types of agreements that are material to a company, a standard already familiar to reporting companies.34
Under Item 1.01, a company must also disclose any material amendment to a material definitive agreement. Disclosure of a material amendment may be required under Item 1.01 even if the underlying agreement previously has not been disclosed by the company. This could occur if, for example, the agreement was entered into prior to the effective date of this Item 1.01, or the amendment results in the agreement becoming a material definitive agreement of the company.
A company must disclose the following information upon entry into, or material amendment of, a material definitive agreement:
The date on which the agreement was entered into or amended, the identity of the parties to the agreement and a brief description of any material relationship between the company or its affiliates and any of the parties, other than in respect of the material definitive agreement or amendment; and
A brief description of the terms and conditions of the agreement or amendment that are material to the company.
We received substantial comment on this item at the proposing stage. In particular, many commenters opposed our proposal to require disclosure of letters of intent and other non-binding agreements in addition to disclosure of definitive agreements that are material to the company.35 They noted that disclosure of non-binding agreements could cause significant competitive harm to the company and create excessive speculation in the market.36 Several companies also stated that they use letters of intent extensively, but that few such letters culminate in a completed transaction.37
In response to the commenters, we eliminated the requirement that companies disclose their entry into non-binding agreements from this item.38 We have further replaced the proposed definition of "agreement" with a definition of "material definitive agreement" and have moved this definition from a proposed instruction into Item 1.01(b). We have clarified that only agreements which provide for obligations that are material to and enforceable against a company, or rights that are material to the company and enforceable by the company against one or more other parties to the agreement by the company, are required to be disclosed pursuant to Item 1.01, regardless of whether the material definitive agreement is enforceable subject to stated conditions.39
We have also eliminated the specific requirements to disclose each party's rights and obligations under the material definitive agreement and the duration and termination provisions of the agreement. To the extent that any of these provisions is material to the company, it must be briefly described under paragraph (a)(2) of the item.
Filing of Exhibits
The proposals would have required a company to file a material agreement required to be disclosed under Item 1.01 as an exhibit to its Form 8-K. We received numerous comments on this proposal. A primary concern of commenters was that companies would not always be able to prepare and submit requests for confidential treatment of sensitive terms of the agreement within the short Form 8-K filing period.40 They recommended several alternatives, including streamlined treatment of such requests, such as by creating a short-form confidential treatment request process,41 and delaying the company's obligation to file the exhibit until it files its next periodic report.42 In addition, some commenters were concerned that the process of preparing to submit such lengthy documents in proper EDGAR format would hinder the ability of a company to report the event promptly.
In response to these comments, we have eliminated the proposed requirement to file the material agreement as a Form 8-K exhibit. Prior to these amendments, material agreements did not need to be filed until the company's next periodic report as there was no Form 8-K item requiring disclosure of the event. Thus, the amendments do not change current requirements with regard to filing material agreements as exhibits, not do they affect the process for requesting confidential treatment of terms of those agreements. Given the initial disclosure of the agreement and its material terms, delayed filing of the exhibit should have minimal effect on the utility of the Item 1.01 disclosure. Pursuant to amended Item 601 of Regulation S-K, a company will have to file such agreement as an exhibit to the company's next periodic report or registration statement.43 However, we encourage companies to file the exhibit with the Form 8-K when feasible, particularly when no confidential treatment is requested.
Considerations Regarding Business Combinations
New Item 1.01 requires disclosure of all material definitive agreements specified by the item, including business combination agreements and other agreements that relate to extraordinary corporate transactions. The filing of the Form 8-K may constitute the first "public announcement" for purposes of Rule 16544 under the Securities Act and Rule 14d-2(b)45 or Rule 14a-1246 under the Exchange Act47 and thereby trigger a filing obligation under those rules.
In the proposing release, we solicited comment on whether Form 8-K should include boxes on the cover page to enable the filer to indicate that the Form 8-K filing also satisfies a separate filing obligation under Rule 165, Rule 14d-2(b) and/or 14a-12.48 We received favorable comments on this issue.49 Thus, to avoid duplicative filings, we are amending Form 8-K to enable a company to check one or more boxes on the cover page to indicate that it is simultaneously satisfying its filing obligations under these rules, provided that the Form 8-K contains all of the information required by those rules.50
Item 1.02 Termination of a Material Definitive Agreement.
We are adopting a new Form 8-K item requiring disclosure if a material definitive agreement not made in the ordinary course of business to which a company is a party is terminated, other than by expiration of the agreement on a stated termination date or as a result of all parties completing their obligations under such agreement, and such termination of the agreement is material to the company. In such an event, the company must disclose the following information:
The date of the termination of the material definitive agreement, the identity of the parties to the agreement and a brief description of any material relationship between the company or its affiliates and any of the parties other than in respect of the material definitive agreement;
A brief description of the terms and conditions of the agreement that are material to the company;
A brief description of the material circumstances surrounding the termination; and
Any material early termination penalties incurred by the company.51
Several commenters believed that an agreement that terminates "by its terms" should not trigger disclosure.52 We have addressed these concerns by excluding termination as a result of expiration of the agreement on its stated termination date or as a result of completion by all parties of their obligations.
Commenters also were concerned that one party to an agreement may use this item as a negotiation tool to induce another party to the agreement to modify the agreement on terms more favorable to the first party, or else potentially suffer a negative market reaction to disclosure about termination of the agreement.53 We believe these comments are addressed by Instruction 1 to Item 1.02 which states that no disclosure is required under the item during negotiations or discussions regarding termination of a material definitive agreement unless and until the agreement has been terminated.
In addition, in response to commenters' concerns, we have further clarified in Instruction 2 to Item 1.02 that no disclosure is required under the item if the company believes, in good faith, that the agreement has not been terminated, unless the company has received a notice of termination pursuant to the terms of the agreement. If a company believes in good faith that a material definitive agreement has not been terminated, but determines nevertheless to make disclosure under Item 1.02, the company could disclose under this item a statement of its good faith belief as to any relevant matter, including, for example, that not all conditions to termination have been satisfied or that a termination has otherwise not occurred. In such event, an amendment54 under this Item 1.02 may be required if the company's conclusion as to termination changes due to a loss of, or change in, its good faith belief.
Other commenters were concerned about the proposed requirement to disclose management's analysis of the effect of the termination, which some referred to as a "mini-MD&A."55 We agree with the commenters that in some cases such analysis may be difficult to provide within the abbreviated Form 8-K filing period and may be more relevant and complete when discussed in the context of full financial statements. Thus, we have removed this proposed requirement from specific required terms of the final rule. Nevertheless, any disclosure made in a report on Form 8-K must include all other material information, if any, that is necessary to make the required disclosure, in the light of the circumstances under which it is made, not misleading.56
Item 1.03 Bankruptcy or Receivership
This item retains the basic substantive requirements formerly included in Item 3 of Form 8-K regarding a company's entry into bankruptcy or receivership. As proposed, however, we are adopting minor changes to make the item more readable, such as breaking out embedded lists from the text and moving some language currently included in the text into an instruction to the item.
Section 2 - Financial Information
Item 2.01 Completion of Acquisition or Disposition of Assets
This item retains most of the substantive requirements included in former Item 2 of Form 8-K. It requires disclosure if a company, or any of its majority-owned subsidiaries, has acquired or disposed of a significant amount of assets, otherwise than in the ordinary course of business.
We recognize that there will frequently be a relationship between the disclosure provided under this item and the disclosure required by new Item 1.01, "Entry into a Material Definitive Agreement." Typically, a company will report its entry into a material definitive agreement to acquire or dispose of assets under Item 1.01, and then later disclose the closing of the acquisition or disposition transaction under Item 2.01. However, a company will not necessarily be required to provide the Item 2.01 disclosure regarding every material definitive acquisition or disposition agreement disclosed under Item 1.01 as Item 2.01 includes a bright-line reporting threshold that is not included in Item 1.01. Under this threshold, a company need only report a completed acquisition or disposition of assets if the transaction meets the significant asset test as set forth in the item.57
We received several comments recommending harmonization between the reporting thresholds in Items 1.01 and 2.01.58 It is our intention, however, that Item 1.01 address a different scope of agreements than those that will trigger disclosure under Item 2.01, which only applies to the acquisition or disposition of assets. We believe that the use of two different thresholds for these items will not cause undue confusion. Indeed, both items use existing thresholds, one from Item 601 of Regulation S-K, the other from former Item 2 of Form 8-K.
Several commenters believed that the disclosure requirements regarding the source of funding for an acquisition typically have not produced meaningful disclosure and should be limited to instances where a material relationship exists between the company and the source of the funding.59 They suggested adding the same type of limitation regarding the disclosure that a company must provide about the formula or principle followed in determining the amount of the consideration involved in the acquisition or disposition. We agree with those commenters and have limited those disclosure requirements to instances in which such a relationship is present.
As proposed, this item requires the same basic disclosure formerly required by Item 2 of Form 8-K, except that disclosure no longer is required regarding the nature of the business in which the acquired assets were used and whether the company acquiring the assets intends to continue such use. In addition, while we proposed revision of the disclosure regarding the source of funds used to effect a change in control, we believe that Congress intended for certain procedures to be present with regard to the disclosure of the identity of a bank involved in such a transaction when the bank is loaning funds in the ordinary course of its business.60 Thus, we are not adopting the proposed changes to this aspect of the item.
Item 2.02 Results of Operations and Financial Condition
We have retained in new Item 2.02 all of the substantive requirements of former Item 12 of Form 8-K regarding public announcements or releases of material non-public information regarding a company's results of operations or financial condition.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
This new item requires disclosure of the following information if the company becomes obligated under a direct financial obligation that is material to the company:
the date on which the company becomes obligated on the direct financial obligation and a brief description of the transaction or agreement creating the obligation;
the amount of the obligation, including the terms of its payment and, if applicable, a brief description of the material terms under which it may be accelerated or increased and the nature of any recourse provisions that would enable the company to recover from third parties; and
a brief description of the other terms and conditions of the transaction or agreement that are material to the company.
In addition, if the company becomes directly or contingently liable for an obligation that is material to the company arising out of an off-balance sheet arrangement, it must provide the following information:
the date on which the company becomes directly or contingently liable on the obligation and a brief description of the transaction or agreement creating the arrangement and obligation;
a brief description of the nature and amount of the obligation of the company under the arrangement, including the material terms under which it may become a direct obligation, if applicable, or may be accelerated or increased and the nature of any recourse provisions that would enable the company to recover from third parties;
the maximum potential amount of future payments (undiscounted) that the company may be required to make, if different;61 and
a brief description of the other terms and conditions of the obligation or arrangement that are material to the company.62
The item defines a "direct financial obligation" as any of the following:
a long-term debt obligation, as defined in Item 303(a)(5)(ii)(A) of Regulation S-K (17 CFR 229.303(a)(5)(ii)(A));
a capital lease obligation, as defined in Item 303(a)(5)(ii)(B) of Regulation S-K (17 CFR 229.303(a)(5)(ii)(B));
an operating lease obligation, as defined in Item 303(a)(5)(ii)(C) of Regulation S-K (17 CFR 229.303(a)(5)(ii)(C)); or
a short-term debt obligation that arises other than in the ordinary course of business.
The item refers to Item 303(a)(4)(ii) of Regulation S-K for the definition of the term "off-balance sheet arrangement."63 It also defines the term "short-term debt obligation" as a payment obligation under a borrowing arrangement that is scheduled to mature within one year, or, for those companies that use the operating cycle concept of working capital, within a company's operating cycle that is longer than one year, as discussed in Accounting Research Bulletin No. 43, Chapter 3A, Working Capital.64
This new item also contains an instruction clarifying that a company need not file a report under this Item 2.03 until the company enters into an agreement enforceable against it, whether or not subject to conditions, under which the direct financial obligation will arise or be created or issued. If there is no such agreement, the company must provide the disclosure within four business days after the occurrence of the closing or settlement of the transaction or arrangement under which the direct financial obligation arises or is created.65
Another instruction clarifies that a company must provide the disclosure required regarding off-balance sheet arrangements, whether or not the company is also a party to the transaction or agreement creating the contingent obligation arising under the off-balance sheet arrangement.66 In the event that neither the company nor any affiliate of the company is also a party to the transaction or agreement creating the contingent obligation arising under the off-balance arrangement in question, the four business day period for reporting the event under this Item 2.03 would begin on the earlier of (i) the fourth business day after the contingent obligation is created or arises, and (ii) the day on which an executive officer67 of the company becomes aware of the contingent obligation.68
The third instruction clarifies that if the company enters into a facility, program or similar arrangement that creates or may give rise to direct financial obligations in connection with multiple transactions, the company must disclose the entering into of the facility, program or similar arrangement, and disclose its obligations, to the extent the obligations are material, as they arise or are created under the facility or program (including when a series of previously undisclosed individually immaterial obligations become material in the aggregate).69
A final instruction70 provides that if the obligation required to be disclosed under this Item 2.03 is a security, or a term of a security, that has been or will be sold pursuant to an effective registration statement of the company, the company is not required to file a Form 8-K pursuant to the item, provided that the prospectus relating to the sale contains the information required by this item and is filed within the required time period under Securities Act Rule 424.71
We received numerous comments on this item. Many commenters requested clarification regarding the scope of obligations covered by this item.72 Since we proposed the amendments, we have adopted new rules requiring a company to provide disclosure about its off-balance sheet arrangements.73 Those rules define the term "off-balance sheet arrangement." Because these are the types of contingent obligations about which Item 2.03 seeks disclosure, new Item 2.03 incorporates the definition of "off-balance sheet arrangement" used in Item 303(a)(4)(ii) of Regulation S-K.
The new off-balance sheet arrangement disclosure rules also require disclosure of certain direct financial obligations in tabular form. We have revised the definition of "direct financial obligation" to refer to much of the same accounting literature used in these rules. We believe this approach will encourage consistency and reduce confusion regarding the scope of this item.
Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.
This new item requires a company to file a Form 8-K report if a triggering event causing the increase or acceleration of a direct financial obligation of the company occurs and the consequences of the event are material to the company. In such case, the company must provide the following information:
the date of the triggering event and a brief description of the agreement or transaction under which the direct financial obligation was created and is increased or accelerated;
a brief description of the triggering event;
the amount of the direct financial obligation, as increased if applicable, and the terms of payment or acceleration that apply; and
any other material obligations of the company that may arise, increase, be accelerated or become direct financial obligations as a result of the triggering event or the increase or acceleration of the direct financial obligation.
Also, if a triggering event occurs causing a company's obligation under an off-balance sheet arrangement to increase or be accelerated, or causing a company's contingent obligation under an off-balance sheet arrangement to become a direct financial obligation of the company, and the consequences of such event are material to the company, it must disclose the following information:
the date of the triggering event and a brief description of the off-balance sheet arrangement;
a brief description of the triggering event;
the nature and amount of the obligation, as increased if applicable, and the terms of payment or acceleration that apply; and
any other material obligations of the company that may arise, increase, be accelerated or become direct financial obligations as a result of the triggering event or the increase or acceleration of the obligation under the off-balance sheet arrangement or its becoming a direct financial obligation of the company.
Item 2.04 defines the term "direct financial obligation" by reference to the definition provided in Item 2.03, but adds for purposes of Item 2.04 that such term includes an obligation arising out of an off-balance sheet arrangement that is accrued under the FASB Statement of Financial Accounting Standards No. 5, Accounting for Contingencies74 (SFAS No. 5) as a probable loss contingency. "Off-balance sheet arrangement" is defined by reference to the definition provided in Item 2.03.75 Finally, Item 2.04(e) defines the term "triggering event" as an event, including an event of default, event of acceleration or similar event, as a result of which a direct financial obligation of the company or an obligation of the company arising under an off-balance sheet arrangement is increased or becomes accelerated or as a result of which a contingent obligation of the company arising out of an off-balance sheet arrangement becomes a direct financial obligation of the company.
We have added four instructions to this item. Similar to Item 2.03, the first instruction clarifies that disclosure is required if a triggering event occurs in respect of the company's obligation under an off-balance sheet arrangement and the consequences are material to the company, whether or not the company is also a party to the transaction or agreement under which the triggering event occurs.76 The second instruction states that no disclosure is required unless and until a triggering event has occurred in accordance with the terms of the relevant agreement, transaction or arrangement, including, if required, the sending to the company of notice of the occurrence of a triggering event pursuant to the terms of the agreement, transaction or arrangement and the satisfaction of all conditions to such occurrence, except the passage of time.
The third instruction provides that, similar to new Item 1.02 of Form 8-K, no disclosure is required if the company believes, in good faith, that no triggering event has occurred, unless the company has received a notice as described in Instruction 2 to Item 2.04. Similar to Item 1.02, a company may wish to disclose under this Item 2.04 a statement of its good faith belief as to any relevant matter, including, for example, that not all conditions to occurrence of a triggering event have been satisfied or that a triggering event otherwise has not occurred. In such event, an amendment under this Item 2.04 may be required if the company's conclusion as to the triggering event changes due to a loss of, or change in, its good faith.77
Finally, Instruction 4 to Item 2.04 explains that, if a company is subject to an obligation arising out of an off-balance sheet arrangement, whether or not disclosed pursuant to Item 2.03, if a triggering event occurs as a result of which under that obligation an accrual for a probable loss is required under SFAS No. 5, the obligation arising out of the off-balance sheet arrangement becomes a direct financial obligation for purposes of Item 2.04. In this situation, if the consequences as determined under Item 2.04(b) are material to the company, disclosure is required under Item 2.04.
Similar to those who objected to the proposed analysis provision in Item 1.02, one commenter opposed requiring disclosure of management's analysis of the effect of the triggering event on the company.78 Again, we agree that it is appropriate to delete this requirement as a specific term of this Form 8-K item. We once again, however, remind companies that any disclosure made in a report on Form 8-K must include all other material information, if any, that is necessary to make the required disclosure, in the light of the circumstances under which it is made, not misleading.79
Item 2.05 Costs Associated with Exit or Disposal Activities
This new item requires disclosure when the board of directors, a committee of the board of directors, or an authorized officer or officers if board action is not required, commits the company to an exit or disposal plan or otherwise disposes of a long-lived asset or terminates employees under a plan of termination described in paragraph 8 of FASB Statement of Financial Accounting Standards No. 146 Accounting for Costs Associated with Exit or Disposal Activities (SFAS No. 146), under which material charges will be incurred under generally accepted accounting principles applicable to the company. The item requires a company to disclose:
the date of the commitment to the course of action and a description of the course of action, including the facts and circumstances leading to the expected action and the expected completion date;
for each major type of cost associated with the course of action (for example, one-time termination benefits, contract termination costs and other associated costs), an estimate of the total amount or range of amounts expected to be incurred in connection with the action;
an estimate of the total amount or range of amounts expected to be incurred in connection with the action; and
the company's estimate of the amount or range of amounts of the charge that will result in future cash expenditures.
If at the time of filing the company is unable to make a good faith estimate of the amount of the charges, it need not disclose an estimate at that time, but must nevertheless file the Form 8-K report describing the company's commitment to a course of action under which it will incur a material charge. Within four business days after the company formulates an estimate, the company must amend its earlier Form 8-K filing to include the estimate.
We initially proposed that disclosure under Item 2.05 would have been triggered upon a "definitive" commitment of the company to a course of action. We have eliminated the term "definitive" because we believe that the tem "commitment" by itself adequately conveys the idea that a company has made a final determination regarding a course of action.
A number of commenters opposed this item. They noted that such events can occur over time, making it difficult to determine the exact date of the triggering event.80 They suggested that it would be more appropriate for this type of disclosure to appear in a company's periodic reports. We believe that it is important for investors to receive this information on a current basis and that, by tying the Form 8-K filing requirement to the board's, committee's or officers' determination, the timing of the disclosure is sufficiently precise.
One commenter believed that a discussion of a single piece of financial information outside of the context of the complete financial statements would be difficult and potentially misleading.81 Nonetheless, we believe that the occurrence of these events are important to investors making investment decisions. Others noted that a company often may not have estimated of the relevant charges at the time the plan is adopted.82 We acknowledge this possibility and thus have revised the item to permit later disclosure of such estimates within four business days after they are determined.
Other commenters noted that, since we proposed this item, FASB has issued SFAS No. 146 which changed previous requirements regarding the timing of recognition of costs associated with exit or disposal activities.83 SFAS No. 146, however, also requires disclosure of such events, prior to recognition, similar to that required in this item.84 We have revised the disclosure requirements to more closely track the disclosures required in the footnotes to the financial statements required by SFAS No. 146. Thus, we do not believe that this item is inconsistent with current accounting literature, particularly in light of the added flexibility we have granted with regard to estimates.
Commenters were also concerned about the requirement that management provide an analysis, or "mini-MD&A," of the effect of this event on the company.85 Consistent with similar revisions that we have made to Items 1.02 and 2.04, we have eliminated this specific disclosure provision from the Item 2.05 disclosure requirements. Once again, we remind companies that any disclosure made in a report on Form 8-K must include all other material information, if any, that is necessary to make the required disclosure, in the light of the circumstances under which it is made, not misleading.86
Finally, commenters recommended that we not use the terms "write-off" or "restructuring" in Item 2.05 as such terms are not defined in the accounting literature.87 We have revised the title and references in the item to reflect these comments and use terminology consistent with those used in the accounting literature.
Item 2.06 Material Impairments
This new item requires disclosure when a company's board of directors, a committee of the board of directors, or an authorized officer or officers if the company, if board action is not required, concludes that a material charge for impairment to one or more of its assets, including, without limitation, an impairment of securities or goodwill, is required under generally accepted accounting principles applicable to the company. Specifically, the company must:
Disclose the date of the conclusion that a material charge is required and describe the impaired asset or assets and the facts and circumstances leading to the conclusion that the charge for impairment is required;
Disclose the company's estimate of the amount or range of amounts of the impairment charge; and
Disclose the company's estimate of the amount or range of amounts of the impairment charge that will result in future cash expenditures.
Comments on this item paralleled those on Item 2.05. We have made similar revisions to this item in response by providing greater flexibility regarding timing of the disclosure of estimates and eliminating the proposed "mini-MD&A" requirement.
We also recognize that tests for impairment or recoverability often occur in conjunction with the preparation, review or audit of financial statements. In light of the fact that a periodic report with complete financial statements will be made available to the public, we have added an instruction indicating that no Form 8-K disclosure is required pursuant to this item if the conclusion regarding the material charge is made in connection with the preparation, review or audit of financial statements at the end of a fiscal quarter or year and the plan is disclosed in the company's Exchange Act report for that period.88
Section 3 - Securities and Trading Market
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
New Item 3.01(a) requires a company to report its receipt of a notice from the national securities exchange or national securities association (or facility thereof) that maintains the principal listing for any class of the company's common equity,89 indicating that:
the company or such class of its securities does not satisfy a rule or standard for continued listing on the exchange or association;
the exchange has submitted an application under Exchange Act Rule 12d2-2 to the Commission to delist such class of the company's securities; or
the association has taken all necessary steps under its rules to delist the security from its automated inter-dealer quotation system.90
A company that receives this type of a notice must disclose the following information:
the date that it received the notice;
the rule or standard for continued listing on the national securities exchange or national securities association that the company fails, or has failed, to satisfy; and
any action or response that, at the time of filing, the company has determined to take in response to the notice.
You are kidding, right? BY LAW Medient was required to inform shareholders of the SEC actions and they have failed to do so. I'm willing to bet the executives have fled to country already.
All publicly traded companies are REQUIRED to notify their shareholders of SEC action as soon as they are made aware. This has NOT happened and only adds to the criminal counts against them when the DOJ takes action.
WOW!! This FRAUD can't even muster a PR in response to the SEC halt and allegations?!? Even most scammy pinkie SCAMS will at least give their bag holders a PR response! Did the principals of the company all flee the country already??
With the "company" going silent this POS will open at $0.0001 and quickly go no bid, volume hitting 0.
Should retest $0.01 next week!
BRKT moved all the way to 0.01!! What's better is we have CANT with a fake BID at 0.035!
Get ready folks, a big move is coming!!!
Well well well! This POS SCAM is over!!!