« PreviousContinue »
(d) the interest of the specified person arises solely from the ownership of securities of the issuer and the speci
fied person receives no extra or special benefit not shared on a pro rata basis by all holders of securities of the class.
3. It should be noted that this item calls for disclosure of indirect, as well as direct, material interests in transac
tions. A person who has a position or relationship with a firm, corporation, or other entity, which engages in
(other than a partnership) which is a party to the transaction, or (ii) from the direct or indirect ownership
the transaction, or (iii) from both such position and ownership. (b) the interest arises only from such person's position as a limited partner in a partnership in which he and
all other persons specified in (1) through (4) above had an interest of less than 10 percent; or (c) the interest of such person arises solely from the holding of an equity interest (including a limited partner
ship interest but excluding a general partnership interest) or a creditor interest in another person which is a party to the transaction with the issuer or any of its subsidiaries and the transaction is not material to
such other person. 4. Include the name of each person whose interest in any transaction is described and the nature of the relationship
by reason of which such interest is required to be described. The amount of the interest of any specified person shall be computed without regard to the amount of the profit or loss involved in the transaction. Where it is not practicable to state the approximate amount of the interest, the approximate amount involved in the transaction shall be disclosed.
5. Information should be included as to any material underwriting discounts and commissions upon the sale of
securities by the registrant where any of the specified persons was or is to be a principal underwriter or is a controlling person, or member, of a firm which was or is to be a principal underwriter. Information need not be given concerning ordinary management fees paid by underwriters to a managing underwriter pursuant to an agree
ment among underwriters the parties to which do not include the registrant or its subsidiaries. 6. As to any transaction involving the purchase or sale of assets by or to the registrant or any subsidiary, otherwise
than in the ordinary course of business, state the cost of the assets to the purchaser and if acquired by the seller
within two years prior to the transaction, the cost thereof to the seller. 7. Information shall be furnished in answer to this item with respect to transactions not excluded above which in
volve remuneration from the registrant or its subsidiaries, directly or indirectly, to any of the specified persons for services in any capacity unless the interest of such persons arises solely from the ownership individually and in the aggregate of less than 10% of any class of equity securities of another corporation furnishing the services
to the registrant or its subsidiaries. 8. The foregoing instructions specify certain transactions and interests as to which information may be omitted
in answering this item. There may be situations where, although the foregoing instructions do not expressly authorize nondisclosure, the interest of a specified person in the particular transaction or series of transactions is not a material interest. In that case, information regarding such interest and transaction is not required to be disclosed in response to this item. The materiality of any interest or transaction is to be determined on the basis of the significance of the information to investors in light of all of the circumstances of the particular transaction. The importance of the interest to the person having the interest, the relationship of the parties to the transaction to each other and the amount involved in the transaction are among the factors to be considered in
determining the significance of the information to investors. 9. For purposes of this item, a person's immediate family shall include such person's spouse; parents; children;
siblings; mothers and fathers-in-law; sons and daughters-in-law; and brothers and sisters-in-law.
Item 19. Certain Market Information.
Furnish the information required by Item 201(a)(2) of Regulation S-K (17 CFR 229.201(a)(2)).
Item 20. Executive Compensation.
(a) (1) Cash compensation. Furnish, in substantially the tabular form specified, all cash compensation paid to the
following persons through the latest practicable date for services rendered in all capacities to the registrant
quired to be disclosed pursuant to this paragraph exceeds $60,000, naming each person; and
1. The Cash Compensation Table shall include: )i) all cash bonuses to be paid for services rendered during the last
fiscal year unless such amounts have not been allocated at such time as the registration statement is filed, and (ii) all compensation that would have been paid in cash but for the fact the payment of such compensation was
deferred. 2. Paragraph (a) applies to any person who was an executive officer of the registrant at any time during the period
specified. However, information need not be given for any portion of the period during which such person was
not an executive officer of the registrant, provided a statement to that effect is made. (b) (1) Compensation pursuant to plans. Describe briefly all plans, pursuant to which cash or non-cash compensa
tion was paid or distributed during the last fiscal year, stating such amounts, and all plans pursuant to which cash or non-cash is proposed to be paid or distributed in the future, to the named individuals and group specified in paragraph (a) of this section. Information need not be given with respect to any group life, health, hospitalization, medical reimbursement or relocation plans that do not discriminate, in scope, terms, or operation in favor of officers or directors of the registrant and that are available generally to all salaried employees. Information relating to pension or retirement benefits need not be disclosed if the amounts to be paid are computed on an actuarial basis under any plan which provides for fixed benefits in the event of
retirement at a specified age or after a specified number of years of service. (2) Stock option plans. In addition to providing the information required by paragraph (b)(1) of this section,
(i) With respect to stock options granted during the last fiscal year: (A) the title and aggregate amount
of securities subject to options; (B) the average per share exercise price; and (C) if such option exercise price was less than 100 percent of the market value of the security on the date of grant, such fact and
the market price on such date. (ii) With respect to stock options exercised during the last fiscal year, regardless of the year such options
were granted, the net value realized upon such exercise, calculated by subtracting the exercise price
from the market value.
of this section, such as personal benefits, securities or property, that was paid or distributed during the last fiscal
$25,000 or 10 percent of the compensation reported in the Cash Compensation Table of such person pur
suant to paragraph (a) of this section or (2) With respect to the group, the aggregate amount of such other compensation is the lesser of $25,000 times
the number of persons in the group or 10 percent of the compensation reported in the Cash Compensation
Table for the group pursuant to paragraph (a) of this section and a statement to that effect is made. Instruction: Compensation within paragraph (c) shall be valued on the basis of the registrant's and subsidiaries' aggregate incremental cost.
(d) Compensation of directors. Describe briefly, stating amounts, all compensation received by directors of the regis
trant for all services as a director.
Item 21. Financial Statements.
(1) The financial statements of the registrant, or the registrant and its predecessors or any businesses to which
the registrant is a successor, which are to be filed as part of the registration statement shall be prepared in accordance with generally accepted accounting principles (GAAP) in the United States or in the case of a Canadian registrant, a reconciliation to such U.S. GAAP shall be included in a note or schedule to the
financial statements. (2) Regulation S-X (17 CFR 210.1-210.12), Form and Content of and Requirements for Financial Statements,
shall not apply to the preparation of such financial statements, except that the report and qualifications of the independent accountant shall comply with the requirements of Article 2 of Regulation S-X (17 CFR 210.2], and registrants engaged in oil and gas producing activities shall follow the financial accounting and reporting standards specified in Article 4-10 of Regulation S-X [17 CFR 210.4-10) with respect to such activities. However, to the extent that Article 10 [17 CFR 210.10] (Interim Financial Statements), Article 11-01 (17 CFR 210.11-01) (Pro Forma Presentation Requirements) and Article 11-02 (17 CFR 210.11-02) (Pro Forma Preparation Requirements) offer enhanced guidelines for the preparation, presentation and disclosure of condensed financial statements and pro forma financial information, registrants may wish to consider these
items for use in a Form S-18 offering. (3) The Commission may, upon the informal written request of the registrant, and where consistent with the
protection of investors, permit the omission of one or more of the financial statements herein required or the filing in substitution therefor of appropriate statements of comparable character. The Commission may also by informal written notice require the filing of other financial statements in addition to, or in substitution for, the statements herein required in any case where such statements are necessary or appropriate for adequate presentation of the financial condition of any person whose financial statements are required, or whose statements are otherwise necessary for the protection of investors.
(b) Consolidated Balance Sheets
(1) The registrant and its subsidiaries consolidated shall file an audited balance sheet as of the end of the most
recent fiscal year, or as of a date within 135 days of the date of filing the registration statement if the regis
trant (including predecessors) existed for a period less than one fiscal year. (2) When the filing date of the registrtation statement falls after 134 days subsequent to the end of the regis
trant's most recent fiscal year, a balance sheet as of an interim date within 135 days of the filing date also shall be included in the registration statement. Such balance sheet need not be audited and may be in condensed form.
(c) Consolidated Statements of Income, Changes in Financial Condition and Stockholder's Equity.
position and stockholders equity for each of the two fiscal years preceding the date of the most recent audit-
being filed. Any interim financial statements may be in condensed form. (2) If an income statement is filed for an interim period there shall also be filed, except for registrants in the
development stage as defined by GAAP, an income statement for a comparable period of the prior year. (3) Any unaudited interim financial statements furnished shall reflect all adjustments which are, in the opinion
of management, necessary to a fair statement of the results for the interim periods presented. A statement to that effect shall be included. Such adjustments shall include, for example, appropriate estimated provisions for bonus and profit sharing arrangements normally determined or settled at year-end. If all such adjustments are of a normal recurring nature, a statement to that effect shall be made; otherwise, there shall be furnished information describing in appropriate detail the nature and amount of any adjustments other than normal recurring adjustments entering into the determination of the results shown.
(d) Financial Statements of Businesses Acquired or to be Acquired. (1) Financial statements for the periods specified in (3) below should be furnished if any of the following condi
(i) Consummation of a significant business combination accounted for as a purchase has occurred or is
probable (for purposes of this rule, the term “purchase" encompasses the purchase of an interest in
a business accounted for by the equity method); or (ii) Consummation of a significant business combination to be accounted for as a pooling of interests is
(2) A business combination shall be considered significant if a comparison of the most recent annual financial
statements of the business acquired or to be acquired and the registrant's most recent annual consolidated financial statements filed at or prior to the date of acquisition indicates that the business would be a significant subsidiary pursuant to the conditions specified in Rule 405 of Regulation C (17 CFR 230.405).
(3) (i) The financial statements shall be furnished for the periods up to the date of acquisition, for those peri
ods for which the registrant is required to furnish financial statements as specified in paragraph (b)
and (c)(1). (ii) The financial statements covering fiscal years shall be audited. (iii) A separate audited balance sheet of the acquired business is not required when the registrant's most
recent audited balance sheet filed is for a date after the acquisition was consummated. (iv) If none of the conditions in the definitions of significant subsidiary in Rule 405 exceeds 20%, income
statements of the acquired business for only the most recent fiscal year and any interim period need be filed.
(4) If consummation of more than one transaction has occurred or is probable, the tests of significance shall
be made using the aggregate impact of the business and the required financial statements may be presented on a combined basis, if appropriate.
(5) This paragraph (d) shall not apply to a business which is totally held by the registrant prior to consummation
of the transaction.
(e) Pro Forma Financial Information. (1) Pro forma information shall be furnished if any of the following conditions exist (for purposes of this rule,
the term “purchase" encompasses the purchase of an interest in a business accounted for by the equity method): (i) During the most recent fiscal year or subsequent interim period for which a balance sheet is required
by paragraph (b), a significant business combination accounted for as a purchase has occurred. After the date of the most recent balance sheet filed pursuant to paragraph (b), consummation of a significant business combination to be accounted for by either the purchase method or pooling of interests method of accounting has occurred or is probable.
(2) The provisions of paragraph (d)(2), (4) and (5) apply to this paragraph (e).
(3) Pro forma statements shall ordinarily be in columnar form showing condensed historical statements, pro
forma adjustments, and the pro forma results and should include the following:
period, pro forma statements of income reflecting the combined operations of the entities for the latest
fiscal year and interim period, if any; or (ii) If consummation of the transaction has occurred or is probable after the date of the most recent balance
sheet, a pro forma balance sheet giving effect to the combination as of the date of the most recent balance sheet required by paragraph (b). For a purchase, pro forma statements of income reflecting the combined operations of the entities for the latest fiscal year and interim period, if any, and for a pooling of interests, pro forma statements of income for all periods for which income statements of the registrant are required.
(1) Age of Financial Statements at Effective Date of Registration Statement. (1) If the financial statements are as of a date 135 days or more prior to the date the registration statement
is expected to become effected the financial statements shall be updated with a balance sheet as of an interim date within 135 days and with statements of income and changes in financial position for the interim period between the end of the most recent fiscal year and the date of the interim balance sheet. There shall also be filed, except for registrants in the development stage, an income statement for a corresponding period of the preceding fiscal year. Such interim financial statements need not be audited and may be in condensed form.
(2) When the anticipated effective date of the registration statement falls within 45 days subsequent to the end
of the fiscal year, the registration statement need not include financial statements more current than as of the end of the third fiscal quarter of the most recently completed fiscal year: Provided, however, That if the audited financial statements for such fiscal year are available they must be included in the registration statement. If the anticipated effective date falls after 45 days subsequent to the end of the fiscal year the
registration statement must include audited financial statements for the most recently completed fiscal year. (3) When the filing date of the registration statement is near the end of a fiscal year and the audited financial
statements for that fiscal year are not included in the registration statement, the registration statement shall
be updated with such financial statements if they become available prior to the anticipated effective date. (g) Special Instructions for Real Estate Operations to be Acquired.
If, during the period for which income statements are required, the registrant (a) has acquired one or more properties which in the aggregate are significant, or (b) since the date of the latest balance sheet required, has acquired or proposes to acquire one or more properties which in the aggregate are significant, the following shall be furnished with respect to such properties. (1) Audited income statements (not including earnings per unit) for the two most recent years, which shall ex
clude items not comparable to the proposed future operations of the property such as mortgage interest, leasehold rental, depreciation, corporate expenses and Federal and state income taxes: Provided, however, That such audited statements need be presented for only the most recent fiscal year if (i) the property is not acquired from a related party; (ii) material factors considered by the registrant in assessing the property are described with specificity in the prospectus with regard to the property, including sources of revenue (including, but not limited to, competition in the rental market, comparative rents, occupancy rates) and expense (including, but not limited to, utility rates, ad valorem tax rates, maintenance expenses, capital improvements anticipated); and (iii) the registrant indicates in the prospectus that, after reasonable inquiry, the registrant is not aware of any material factors relating to that specific property other than those discussed in response to paragraph (1)(ii) of this section that would cause the reported financial information
not to be necessarily indicative of future operating results. (2) If the property is to be operated by the registrant there shall be furnished a statement showing the estimated
taxable operating results of the registrant based on the most recent twelve month period including such adjustments as can be factually supported. If the property is to be acquired subject to a net lease the estimated taxable operating results shall be based on the rent to be paid for the first year of the lease. In either case, the estimated amount of cash to be made available by operations shall be shown. There shall be stated in an introductory paragraph the principal assumptions which have been made in preparing the statements of
estimated taxable operating results and cash to be made available by operations. (3) If appropriate under the circumstances, there shall be given in tabular form for a limited number of years
the estimated cash distribution per unit showing the portion thereof reportable as taxable income and the portion representing a return of capital together with an explanation of annual variations, if any. If taxable net income per unit will become greater than the cash available for distribution per unit, that fact and ap
proximate year of occurrence shall be stated, if significant. (h) Special Instructions for Limited Partnerships. (1) In addition to the financial reporting requirements in paragraphs (a) through (g), registrants which are limit
ed partnerships are required also to file the balance sheets of the general partners as described in subpara
graphs (2) through (4), below. (2) Where a general partner of the limited partnership is a corporation there shall be filed an audited balance
sheet of such corporation as of the end of its most recently completed fiscal year. Receivables from the parent or affiliate of the general partner (including notes receivable, but excluding trade receivables), should