SEC NEWS DIGEST Issue 2004-10 January 15, 2004 COMMISSION ANNOUNCEMENTS SEC PROPOSES NEW INVESTMENT COMPANY GOVERNANCE REQUIREMENTS, NEW INVESTMENT ADVISER CODES OF ETHICS REQUIREMENTS, AND NEW CONFIRMATION AND POINT OF SALE DISCLOSURE REQUIREMENTS On January 14, the Commission voted to propose three regulatory initiatives designed to better protect the 95 million investors in mutual funds. These initiatives represent the next in a series of securities law reforms pursued by the Commission to address problems identified with the management and sale of mutual funds. 1. Investment Company Governance. Mutual fund boards of directors play an important role in protecting fund investors. They have overall responsibility for the fund, oversee the activities of the fund adviser, and negotiate the terms of the advisory contract, including the amount of the advisory fees and other fund expenses. The Commission voted to propose amendments to its rules to enhance fund boards' independence and effectiveness and to improve their ability to protect the interests of the funds and fund shareholders they serve. The rule amendments are designed to strengthen the hand of independent directors when dealing with fund management. * Independent Composition of the Board. Independent directors would be required to constitute at least 75 percent of the fund's board. This requirement is designed to strengthen the presence of independent directors and improve their ability to negotiate lower advisory fees and other important matters on behalf of the fund. * Independent Chairman. The board would be required to appoint a chairman who is an independent director. The board's chairman typically controls the board's agenda and can have a strong influence on the board's deliberations. * Annual Self-Assessment. The board would be required to assess its own effectiveness at least once a year. Its assessment would have to include consideration of the board's committee structure and the number of funds on whose boards the directors serve. * Separate Meetings of Independent Directors. The independent directors would be required to meet in separate sessions at least once a quarter. This requirement could provide independent directors the opportunity for candid discussions about management's performance, and could help improve collegiality. * Independent Director Staff. The fund would be required to authorize the independent directors to hire their own staff. This requirement is designed to help independent directors deal with matters on which they need outside assistance. Comments on the proposed rule amendments should be received by the Commission within 45 days of publication in the Federal Register. 2. Codes of Ethics for Investment Advisers. The Commission voted to propose new rule 204A-1 and related rule amendments under the Investment Advisers Act of 1940. New rule 204A-1 would require registered investment advisers to adopt and enforce codes of ethics applicable to their supervised persons. Investment advisers are fiduciaries that owe their clients a duty of undivided loyalty. The Commission's recent enforcement proceedings suggest that some advisory personnel may have forgotten or ignored this duty. The new rule is designed to prevent fraud by reinforcing the fiduciary principles that must govern the conduct of advisory firms and their personnel. An adviser's code of ethics would have to include certain minimum provisions. * Standards of Business Conduct. The code would be required to establish standards of conduct that are expected of the adviser's supervised persons and that reflect the adviser's fiduciary duties. Supervised persons would have to acknowledge, in writing, receipt of a copy of the code of ethics. * Compliance with Federal Securities Laws. An adviser's code of ethics would have to require the adviser's supervised persons to comply with applicable federal securities laws. * Safeguard Nonpublic Information. The code would have to contain provisions reasonably designed to prevent disclosure of material nonpublic information about the adviser's securities recommendations and clients' securities holdings and transactions to persons without a "need to know." * Personal Securities Reporting. Advisers' codes of ethics would have to require certain supervised persons ("access persons") to report their personal securities holdings and transactions, including transactions in mutual funds advised by the adviser or an affiliate. Currently, only mutual fund advisers must have a code of ethics requiring their personnel to report their personal securities transactions. * Pre-Approval of Certain Transactions. The code of ethics would have to require access persons to pre-clear any personal investments in initial public offerings and limited (private) offerings. * Reporting of Code Violations. The code of ethics would have to require supervised persons to report, promptly, any violations of the adviser's code of ethics to the firm's compliance officer or to another designated person. Comments on the proposed rule and related amendments should be received by the Commission within 45 days of publication in the Federal Register. 3. Confirmation Requirements and Point of Sale Disclosure Requirements for Transactions in Certain Mutual Funds and Other Securities, and Other Confirmation Requirement Amendments, and Amendments to the Registration Form for Mutual Funds The Commission voted to propose two new rules and rule amendments that are designed to enhance the information that broker-dealers provide to their customers in connection with transactions in certain types of securities. The two new rules would require broker-dealers to provide their customers with targeted information, at the point of sale and in transaction confirmations, regarding the costs and conflicts of interest that arise from the distribution of mutual fund shares, unit investment trust (UIT) interests (including insurance company separate accounts that offer variable annuity contracts and variable life insurance policies), and municipal fund securities used for education savings (commonly called 529 plans). The rules would require disclosure at two key times - first at the point of sale, and second at the completion of a transaction in the transaction confirmation. Proposed Rule 15c2-3 - Point of Sale Requirements Because confirmation disclosure does not provide information to investors prior to transactions in securities - i.e., at the time they make investment decisions - we are proposing new rule 15c2-3 to require brokers, dealers and municipal securities dealers to provide point of sale disclosure to customers prior to effecting transactions in mutual fund shares, UIT interests, and 529 plan shares. The rule would require the broker, dealer or municipal securities dealer to inform its customer about the distribution-related costs that the customer would be expected to incur in connection with the transaction. This would include separate disclosure (either by reference to the value of the purchase, or, if no amount was specified, by reference to a model investment of $10,000) about: (1) the amount of sales loads that would be incurred at the time of purchase, and the amount of that load that would be paid to the broker-dealer; (2) estimated asset-based sales charges and asset-based service fees paid out of fund assets in the year following the purchase if net asset value remained unchanged; and (3) the maximum amount of any deferred sales load that would be associated with the purchase if those shares are sold within one year, along with a statement about how many years a deferred sales load may be in effect. In addition, the rule would require disclosure of whether the broker, dealer or municipal securities dealer receives revenue sharing or portfolio brokerage commissions from the fund complex, as well as whether it pays differential compensation in connection with transactions in the covered security, if the covered security is either a class B share or a proprietary security. Customers' right to terminate orders made prior to disclosure - Under the rule, an order made prior to the required point of sale disclosure would be treated as an indication of interest. Manner of disclosure - The rule would generally require a broker, dealer or municipal securities dealer to give or send the information to the customer in writing using a new standardized form, Schedule 15D. This would be supplemented by oral disclosure if the point of sale occurs at an in- person meeting. If the point of sale occurs through means of an oral communication other than at an in-person meeting, however, then the information would only be disclosed to the customer orally. Recordkeeping - Brokers, dealers or municipal securities dealers, at the time they disclose information required by the rule, would have to make records of communications sufficient to demonstrate compliance. Exceptions - The rule would contain a limited exception for transactions resulting from orders that a customer placed via U.S. mail, messenger delivery or a similar third-party delivery service. It also would contain an exception for certain brokers that did not communicate with the customer, except to accept an order, if they reasonably believe another broker provided point of sale disclosure. The rule also would contain other targeted exceptions. Proposed Rule 15c2-2 - Confirmation Requirement Proposed rule 15c2-2 would require more quantitative disclosure of the information included in the point of sale document. Disclosures for purchases - Proposed rule 15c2-2 would require specific disclosures in purchase transactions that build on the point of sale requirements. These requirements would include: (1) Cost and remuneration disclosure - Disclosure of the amount of any sales load that the customer has incurred (front end load) or will incur (back end load) at the time of purchase, expressed in dollars and as a percentage of the net amount invested, and disclosure of any dealer concession that the broker, dealer or municipal securities dealer earns in connection with the transaction, expressed in dollars and as a percentage of the net amount invested. (2) Revenue sharing and portfolio brokerage disclosure - Disclosure of quantified information about revenue sharing arrangements and portfolio brokerage (i.e., effecting transactions for an issuer's own portfolio). In particular, the rule would require disclosure of (a) revenue sharing payments from persons within the fund complex, and (b) commissions, including riskless principal compensation, associated with portfolio securities transactions on behalf of the issuer of the security, or other securities within the fund complex. This disclosure would be quantified based on the pro rata estimates of the amount of income received by the broker from the fund complex as compared to the assets of the funds. This ratio would then be applied to the assets invested by the particular investor. Disclosure would also be required of any specific revenue sharing arrangement that would be applicable to the transaction. (3) Differential compensation disclosure -- Disclosure of whether a broker, dealer or municipal securities dealer pays its salespersons more compensation if they sell securities that carry a deferred sales load, or if they sell "proprietary" securities (that is, securities issued by an affiliate of the broker, dealer or municipal securities dealer). Periodic disclosure alternative - The rule would permit brokers, dealers and municipal securities dealers to disclose the required information periodically -- rather than transaction-by-transaction -- in certain limited circumstances involving transactions in a "covered securities plan" or in no-load open-end money market funds, after an initial confirmation has been sent that meets the requirements of the rule. Comparison range disclosure - The rule would provide a mechanism to give investors additional context for evaluating the significance of certain information. This context would come from comparison ranges for sales compensation, revenue sharing, and portfolio brokerage commissions, so that investors can see where their particular costs and payments fall in comparison to the median and ranges in the marketplace. The Commission would need to propose additional rules to determine how to obtain and disseminate comparison range information. General disclosure requirements - For all transactions (sales as well as purchases), the rule would require disclosure of (1) the date of the transaction, (2) the issuer and class of the security, (3) the net asset value of the shares or units and, if different, their public offering price, (4) the number of shares purchased or sold by the customer, (5) the total dollar amount paid or received in the transaction, (6) the net amount of the investment bought or sold in the transaction, (7) any commission, markup or other remuneration the broker, dealer or municipal securities dealer will receive from the customer in connection with the transaction, and (8) when applicable, that a broker, dealer or municipal securities dealer is not a member of the Securities Investor Protection Corporation (SIPC), or that the broker, dealer or municipal securities dealer clearing or carrying the customer account is not a member of SIPC. Proposed Amendments to the Commission's General Confirmation Requirements and Form N-1A The Commission also voted to propose conforming amendments to its general confirmation rule, as well as amendments to that rule to provide investors with additional information about call features of debt securities and preferred stock. Finally, the Commission voted to propose amendments to Form N-1A, the registration form for mutual funds, to improve disclosure of sales loads and revenue sharing. Special Request for Comments from Investors Finally, these initiatives are intended to give investors "news they can use." In addition to including a special section in the proposal soliciting comments from investors, the Commission intends to reach out to the investor community through a variety of methods, including investor focus groups. This process is intended to design requirements - including standardized disclosure forms - that average investors will find useful and informative. Comments on these proposals should be received by the Commission within 60 days of publication in the Federal Register. (Press Rel. 2004-5) ENFORCEMENT PROCEEDINGS NEW YORK STOCK EXCHANGE ACTION SET ASIDE The Commission has set aside action of the New York Stock Exchange, Inc. against Bloomberg, L.P., an Exchange data vendor. The action concerned the enforcement, by the Exchange, of restrictions the Exchange had imposed on its data vendors as a condition to the vendors receiving and being permitted to disseminate the Exchange's new Liquidity Quote data. The Commission set aside the Exchange's action based on the determination that the Exchange was not acting in accordance with any Exchange rule approved by the Commission (or subject to an exception from such approval requirement), as required by the Securities Exchange Act of 1934. (Rel. 34-49076; File No. 3-11129) NOTICE OF PROPOSED PLAN FOR THE DISTRIBUTION OF DISGORGEMENT FUND On January 14, the Commission issued Notice of a Proposed Plan for the Distribution of Disgorgement Fund (Plan) In the Matter of Robertson Stephens, Inc. The notice provides 30 days, until Feb. 13, 2004, within which persons desiring to comment on the Plan may submit their written views. On Jan. 9, 2003, the Commission issued an Order in this proceeding in which it found that Respondent Robertson Stephens, Inc. (RSI) willfully violated Sections 15(c) and 17(a) of the Securities Exchange Act of 1934 (Exchange Act), and Rules 15c1-2(b), 17a-4(b)(4), and 17a-4(j) thereunder. In addition to censuring RSI, the Commission ordered RSI to pay disgorgement, including prejudgment interest, of $885,000 and a civil penalty of $4,115,000, for a total of $5 million. Pursuant to the Order, on Jan. 14, 2003, RSI paid $5 million to the Commission's Comptroller. The monies are presently being held in a non-interest bearing account at the United States Treasury (the Fund). Under Section 308 of the Sarbanes-Oxley Act of 2002, also known as the Fair Funds for Investors protection, in Commission actions in which both disgorgement and penalties are obtained against a respondent, the Commission may authorize the staff to seek to have the civil penalty added to disgorgement fund for the benefit of the victims. The Commission authorized the penalty paid by RSI added to the funds available for distribution for the benefit of the victims. The Plan appoints Laurence Storch as administrator of the Plan. The Plan makes eligible for distribution from the Fund: (1) those who purchased shares of the Corvis common stock that were sold by RSI, on behalf of three partnerships, during the pre-market trading session on Jan. 24, 2001; and (2) RSI customers who purchased Corvis common stock from RSI during the period from Jan. 16, 2001, to Jan. 26, 2001. (Rel. 34-49077; File No. 3-11003) IN THE MATTER OF ALLIANCE CAPITAL MANAGEMENT, L.P. On January 15, the Commission issued an Amended Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940 and Sections 9(b) and 9(f) of the Investment Company Act of 1940, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order (Amended Order) against Alliance Capital Management, L.P. (Alliance Capital). The Amended Order finds that Alliance Capital breached its fiduciary duty to certain of the mutual funds it managed by allowing "timing capacity" in these mutual funds to known timers in return for or in connection with the timers' investments of "sticky assets" in Alliance Capital managed hedge funds, mutual funds, and other investment vehicles, from which Alliance Capital earned management and performance fees. At their height in 2003, Alliance Capital had over $600 million in approved timing in its mutual funds. The prospectuses for these mutual funds gave the misleading impression that Alliance Capital sought to prevent timing in these mutual funds. In addition, Alliance Capital accommodated timers by lifting a prohibition on futures trading in one mutual fund pursuant to a misleading proxy statement and by providing material nonpublic information about the portfolio holdings of certain mutual funds to at least one of the timers. The Amended Order further finds that Alliance Capital willfully violated Sections 204A, 206(1) and 206(2) of the Investment Advisers Act of 1940 (Advisers Act) and Sections 17(d), 20(a), and 34(b) of the Investment Company Act of 1940 and Rules 17d-1 and 20a-1 thereunder. The Amended Order, in paragraph 62, incorporates changes from the original Order issued Dec. 18, 2003, to reflect that certain changes in corporate governance policies and practices set forth in the original Order were not yet in effect but will be put into effect within 90 days of the entry of the Amended Order. Based on the above, the Amended Order: (1) requires Alliance Capital to cease-and-desist from committing or causing any violations and any future violations of Sections 204A, 206(1), and 206(2) of the Advisers Act and Sections 17(d), 20(a), and 34(b) of the Investment Company Act and Rules 17d- 1 and 20a-1 thereunder; (2) orders Alliance Capital to pay $150,000,000 in disgorgement and prejudgment interest and a civil money penalty of $100,000,000; and (3) requires Alliance Capital to comply with significant remedial undertakings. Alliance Capital consented to the issuance of the Amended Order without admitting or denying the findings therein. (Rels. IA-2205A; IC-26312A; File No. 3-11359) IN THE MATTER OF WEISER LLP, VICTOR WAHBA, CPA, AND STUART NUSSBAUM, CPA On January 14, the Commission issued an Order Instituting Public Administrative and Cease-and-Desist Proceedings Pursuant to Section 203(k) of the Investment Advisers Act of 1940 and Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions and a Cease- and-Desist Order (Order) against Weiser LLP (Weiser), Victor R. Wahba, CPA (Wahba), and Stuart A. Nussbaum, CPA (Nussbaum) (collectively the Respondents). The Order finds that in 1997 and 1998, the Respondents conducted two inadequate surprise examinations pursuant to Rule 206(4)- 2(a)(5) of the Investment Advisers Act of 1940 (Advisers Act) of Sagam Capital Management Corp. (Sagam Corp.), an investment adviser registered with the Commission. From 1995 to 2001, Sagam Corp., and its president, Yehuda Shiv, created and delivered false account statements that overstated the value of the clients' accounts to Sagam Corp.'s clients. By 2001, Sagam Corp. and Shiv had overstated the value of these clients' accounts by at lease $139 million. The Respondents failed to conduct the 1997 and 1998 surprise examinations in accordance with Rule 206(4)-2(a)(5) and applicable professional standards by, among other things, failing to: (1) examine all client accounts over which Sagam Corp. maintained custody of funds and securities; (2) verify all the funds and securities for the accounts that they did choose to examine; and (3) contact Sagam Corp.'s clients to obtain written verification of the funds and securities in the clients' accounts. The Order finds that by failing to conduct adequate surprise examinations in 1997 and 1998 the Respondents caused Sagam Corp. to violate Section 206(4) of the Advisers Act. The Order further finds that the Respondents willfully aided and abetted Sagam Corp.'s violations of Section 206(4) of the Advisers Act and engaged in improper professional conduct pursuant to Rule 102(e) of the Commission's Rules of Practice. Based on the above, the Order requires Weiser, Wahba, and Nussbaum to cease and desist from committing or causing any violations or future violations of Rule 206(4) of the Advisers Act. Further, the Order censures Weiser and orders that Wahba and Nussbaum be denied the privilege of practicing before the Commission pursuant to Rule 102(e) of the Commission's Rules of Practice. The Order allows Wahba and Nussbaum to apply for reinstatement of the privilege after four years and one year, respectively. Under the Order, Weiser must pay disgorgement of $39,679 and comply with certain undertakings concerning its policies and procedures for performing accounting work under the Advisers Act and the Investment Company Act of 1940. The Respondents consented to the entry of the order without admitting or denying the findings therein. (Rels. 34-49082; IA-2208; AAE Rel. 1943; File No. 3-11374) ACTION FOR CIVIL CONTEMPT FILED AGAINST PATRICK BRODY The Commission filed on Nov. 10, 2003, a Motion for Contempt Against Patrick M. Brody, alleging that Brody had violated a Jan. 15, 2002, order issued by the U.S. District Court for the District of Utah freezing his assets in SEC v. Merrill Scott & Associates, Ltd., et al. Brody was originally charged by the Commission in that civil injunctive action with violations of the antifraud provisions of the federal securities laws for his conduct in an offshore investment scheme. In the January 2002 action, the Commission obtained an order, among other things, enjoining Brody from violations of federal securities laws and freezing the assets of Brody and a complex network of legal entities and accounts that operated under the umbrella of Merrill Scott & Associates, Ltd. (Merrill Scott). The contempt motion alleges that in violation of the Jan. 15, 2002, order, Brody continued to engage in the same conduct from which he was enjoined under the name of Fortune Advisors, Inc., and that he financed Fortune Advisors using funds transferred to Merrill Scott agents prior to imposition of the asset freeze. It is further alleged that Brody has continued his deceptive business practices by misappropriating investor funds intended for Fortune Advisors in violation of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and (2) of the Advisers Act. The Commission is seeking that Brody be held in contempt of the court's orders, and is requesting that Brody be ordered to repay the funds transferred in violation of the court's asset freeze and to provide a sworn accounting of all accounts and assets of the Merrill Scott organization. [SEC v. Merrill Scott & Associates, Ltd., et al., Docket No. 2:02CV 0039C, USDC, Utah] (LR-18542) SEC SETTLES CIVIL FRAUD CHARGES FILED AGAINST ANDREW FASTOW, FORMER ENRON CHIEF FINANCIAL OFFICER Fastow To Disgorge More Than $23 Million; Agrees To Cooperate In Ongoing Investigation On January 14, the Commission settled civil fraud charges filed against Andrew S. Fastow, Enron's former Chief Financial Officer. The complaint, filed on Oct. 2, 2002, in U.S. District Court in Houston, alleged that Fastow defrauded Enron's shareholders and enriched himself and others by, among other things, entering into undisclosed side deals, manufacturing earnings for Enron through sham transactions, and inflating the value of Enron's investments. Without admitting or denying the allegations in the Commission's complaint, Fastow has agreed to be enjoined permanently from violating the antifraud, periodic reporting, books and records, and internal control provisions of the federal securities laws, and to be barred permanently from acting as an officer or director of a public company. The Commission settled its action in coordination with the Justice Department's Enron Task Force, which entered into a guilty plea with Fastow on related criminal charges. In resolving the parallel civil and criminal proceedings, Fastow has agreed to serve a ten-year sentence, disgorge more than $23 million and to cooperate with the government's continuing investigation. As alleged in the Commission's complaint, Fastow participated in a series of fraudulent transactions. Three of the transactions - RADR, Chewco, and Southampton - were part of an alleged scheme to hide Fastow's interest in and control of certain entities in order to avoid consolidating those entities in Enron's financial statements. This was done, according to the complaint, for self-enrichment and to mislead analysts, rating agencies, and others about Enron's true financial condition. Two of the transactions - the Nigerian barges and Cuiaba - are alleged to have been sham sales best described as secret asset-parking arrangements. The Nigerian barges involve Enron's purported sale of an interest in certain Nigerian barges to Merrill Lynch & Co., Inc. (Merrill). Fastow is alleged to have personally promised that Merrill would be taken out of its so-called investment and later arranged for an entity he controlled, LJM2 Co-Investment, L.P. (LJM2), to buy the financial institution's interest at a pre-arranged rate of return on a pre-arranged time table. In Cuiaba, Enron entered into a transaction with another off-balance- sheet entity controlled by Fastow, LJM Cayman, L.P. (LJM1), to sell an interest in a severely troubled power plant in Cuiaba, Brazil, in order to avoid consolidation of project debt and recognize earnings. In connection with this transaction, Fastow allegedly entered into an unwritten side agreement with Enron requiring Enron to buy back the interest it just sold to Fastow at a guaranteed profit. In the last transaction, Enron and LJM2 created a complex financial structure - Raptor I - that allowed Enron to hedge against potential declines in certain of its mark-to-market investments. LJM2's $30 million investment - representing the purported 3% outside equity required to be at risk in order for Enron to avoid consolidating the Raptor vehicle in its financial statements - however was not at risk. Fastow allegedly entered into an undisclosed side deal in which Enron agreed that, prior to conducting any hedging activity with Raptor I, Enron would return LJM2's investment ($30 million) plus a guaranteed return ($11 million). As a result, Raptor I should have been consolidated on Enron's financial statements. To conceal the side deal, Fastow and others allegedly devised a scheme to manufacture the $41 million payment to LJM2. Enron and the Raptor vehicle entered into a "put," a transaction in which Enron essentially bet that its own stock price would decline. Enron purchased that "put" option from the Raptor vehicle for $41 million. The $41 million was then transferred from Raptor I to LJM2. The complaint alleged that there was no true business purpose for the "put" other than to generate funds to pay LJM2 under the undisclosed side deal. The complaint also alleged that in September 2000, Fastow and others used Raptor I to effectuate a fraudulent hedging transaction and thus avoid a decrease in the value of Enron's investment in the stock of a public company called Avici Systems Inc. Specifically, Fastow and others back- dated documents to make it appear that Enron locked in the value of its investment in Avici in early August 2000, when Avici's stock was trading at its all time high price. The Commission's investigation relating to Enron is continuing. [SEC v. Andrew S. Fastow, Civil Action No. H-02- 3666 (Hoyt) SDTX] (LR-18543; AAE Rel. 1942; Press Rel. 2004- 6) SELF-REGULATORY ORGANIZATIONS IMMEDIATE EFFECTIVENESS OF PROPOSED RULE CHANGES A proposed rule change (SR-NASD-2003-172) filed by the National Association of Securities Dealers, through its subsidiary, The Nasdaq Stock Market, Inc. relating to certain technical changes to NASD Rules 4200, 4200A, 4350 and 4350A has become effective under Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication of the proposal is expected in the Federal Register during the week of January 19. (Rel. 34-49060) A proposed rule change (SR-NYSE-2003-36) filed by the New York Stock Exchange relating to the Exchange's interpretation of NYSE Rule 15A (ITS "Trade-Throughs" and "Locked Markets") has become effective under Section 19b(3)(A) of the Securities Exchange Act of 1934. Publication of the proposal is expected in the Federal Register during the week of January 19. (Rel. 34-49063) APPROVAL OF PROPOSED RULE CHANGE The Commission approved a proposed rule change (SR-BSE-2002- 15), and granted accelerated approval of Amendment No. 4 thereto, submitted by the Boston Stock Exchange to establish trading rules for the Boston Options Exchange Facility. Publication of the proposal is expected in the Federal Register during the week of January 19. (Rel. 34-49068) PROPOSED RULE CHANGE The Philadelphia Stock Exchange. has filed a proposed rule change (SR-Phlx-2003-72) to reduce strike prices for index options. Publication of the proposal is expected in the Federal Register during the week of January 19. (Rel. 34- 49074) SECURITIES ACT REGISTRATIONS The following registration statements have been filed with the SEC under the Securities Act of 1933. The reported information appears as follows: Form, Name, Address and Phone Number (if available) of the issuer of the security; Title and the number and/or face amount of the securities being offered; Name of the managing underwriter or depositor (if applicable); File number and date filed; Assigned Branch; and a designation if the statement is a New Issue. Registration statements may be obtained in person or by writing to the Commission's Public Reference Branch at 450 Fifth Street, N.W., Washington, D.C. 20549 or at the following e-mail box address: . In most cases, this information is also available on the Commission's website: . S-8 CYBERTEL COMMUNICATIONS CORP, 2820 LA MIRADA DRIVE, #H, VISTA, CA, 92083, 8006455557 - 0 ($1,485,000.00) Equity, (File 333-111902 - Jan. 14) (BR. 37) S-3 HYBRIDON INC, 345 VASSAR STREET, CAMBRIDGE, MA, 02139, 6176795500 - 0 ($20,800,000.00) Equity, (File 333-111903 - Jan. 14) (BR. 01) S-1 ULTRA CLEAN HOLDINGS INC, 0 ($86,250,000.00) Equity, (File 333-111904 - Jan. 14) (BR. 36) S-3D FARMERS NATIONAL BANC CORP /OH/, 20 S BROAD STREET, P O BOX 555, CANFIELD, OH, 44406, 3305333341 - 750,000 ($11,925,000.00) Equity, (File 333-111905 - Jan. 14) (BR. 07) F-6 NORWOOD ABBEY LTD, LEVEL 7 470, COLLINS STREET, MILBOURNE, C3, 00000, 100,000,000 ($5,000,000.00) ADRs/ADSs, (File 333-111910 - Jan. 14) (BR. ) S-8 GOLDEN SPIRIT MINERALS LTD, 1288 ALBERNI ST STE 806, VANCOUVER BRITISH COLUMBIACANADAV6E4N5, BELLINGHAM, A2, 00000, 6046640484 - 11,150,000 ($446,000.00) Equity, (File 333-111911 - Jan. 14) (BR. 03) S-8 SILVERADO GOLD MINES LTD, 1111 WEST GEORGIA ST, SUITE 505, VANCOUVER BC CANADA, A1, V6E 4M3, 6046891535 - 7,500,000 ($985,500.00) Equity, (File 333-111913 - Jan. 14) (BR. 04) S-8 SCHEIN HENRY INC, 135 DURYEA RD, MELVILLE, NY, 11747, 6318425500X6867 - 0 ($125,960,000.00) Equity, (File 333-111914 - Jan. 14) (BR. 02) S-8 MERCURY INTERACTIVE CORPORATION, 4088225200 - 8,000,000 ($362,913,250.00) Equity, (File 333-111915 - Jan. 14) (BR. 03) S-2 ORLEANS HOMEBUILDERS INC, ONE GREENWOOD SQUARE, 3333 STREET ROAD SUITE 101, BENSALEM, PA, 19020, 2152457500 - 0 ($55,660,000.00) Equity, (File 333-111916 - Jan. 14) (BR. 06) SB-2 AMERICASBANK CORP, 500 YORK RD, TOWSON, MD, 21204, 4108255580 - 2,875,000 ($7,187,500.00) Equity, (File 333-111918 - Jan. 14) (BR. 07) S-3 CHARTERMAC, 625 MADISON AVENUE, NEW YORK, NY, 10022, 2124215333 - 16,071,785 ($34,618,624.00) Unallocated (Universal) Shelf, (File 333-111919 - Jan. 14) (BR. 08) S-8 ELINEAR INC, 8800 JAMEEL ROAD, SUITE 170, HOUSTON, TX, 77040, 713-690-0855 - 2,000,000 ($4,090,000.00) Equity, (File 333-111920 - Jan. 14) (BR. 03) SB-2 VITAL LIVING INC, 5080 NORTH 40TH STREET, SUITE 105, PHOENIX, AZ, 85018, 602-952-9909 - 0 ($50,853,687.57) Equity, (File 333-111921 - Jan. 14) (BR. 01) RECENT 8K FILINGS Form 8-K is used by companies to file current reports on the following events: Item 1. Changes in Control of Registrant. Item 2. Acquisition or Disposition of Assets. Item 3. Bankruptcy or Receivership. Item 4. Changes in Registrant's Certifying Accountant. Item 5. Other Materially Important Events. Item 6. Resignations of Registrant's Directors. Item 7. Financial Statements and Exhibits. Item 8. Change in Fiscal Year. Item 9. Regulation FD Disclosure. Item 10. Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics. Item 11. Temporary Suspension of Trading Under Registrant's Employee Benefit Plans. Item 12. Results of Operations and Financial Condition. The following companies have filed 8-K reports for the date indicated and/or amendments to 8-K reports previously filed, responding to the item(s) of the form specified. 8-K reports may be obtained in person or by writing to the Commission's Public Reference Branch at 450 Fifth Street, N.W., Washington, D.C. 20549 or at the following e-mail box address: . In most cases, this information is also available on the Commission's website: . STATE 8K ITEM NO. NAME OF ISSUER CODE 1 2 3 4 5 6 7 8 9 10 11 12 13 DATE COMMENT ------------------------------------------------------------------------------------------------ AASTROM BIOSCIENCES INC MI X X 01/14/04 ABC BANCORP GA X X 01/13/04 ACE CASH EXPRESS INC/TX TX X X 12/30/03 ACETO CORP NY X X 12/31/03 ACTION PERFORMANCE COMPANIES INC AZ X X 01/13/04 ADOLOR CORP X X 01/13/04 ADVANCED MARKETING SERVICES INC DE X 01/14/04 ADVANCED MARKETING SERVICES INC DE X 01/14/04 AEI INCOME & GROWTH FUND XXI LTD PART MN X X 12/30/03 AEI NET LEASE INCOME & GROWTH FUND XI MN X X 12/30/03 AETHER SYSTEMS INC DE X X 01/13/04 ALARIS MEDICAL SYSTEMS INC DE X 12/31/03 ALBERTO CULVER CO DE X X 01/14/04 AMB PROPERTY CORP MD X X X 01/13/04 AMEREN CORP MO X X 01/14/04 AMEREN CORP MO X X 01/14/04 AMEND ANDERSEN GROUP INC DE X X 01/14/04 ANTS SOFTWARE INC DE X 01/14/04 AP HENDERSON GROUP NV X X X 12/31/03 APOGEE ENTERPRISES INC MN X 01/05/04 APPLE COMPUTER INC CA X X 01/14/04 ARLINGTON HOSPITALITY INC DE X X 01/14/04 ASHFORD HOSPITALITY TRUST INC MD X X 11/24/03 AMEND AURORA FOODS INC /DE/ DE X X X 01/13/04 BAKER HUGHES INC DE X X 01/14/04 BANK JOS A CLOTHIERS INC /DE/ DE X X 01/03/04 BANK OF THE OZARKS INC AR X X X 01/13/04 BARRY R G CORP /OH/ OH X X 01/12/04 BEAR STEARNS ALT A MORT PASS THR CERT DE X 01/14/04 BEAR STEARNS ASSET BACKED CERTS SER 2 DE X 12/30/03 BEAR STEARNS ASST ASSET BACKED CERTS DE X 12/30/03 BION ENVIRONMENTAL TECHNOLOGIES INC CO X X 01/12/04 BIW LTD CT X X 10/31/03 AMEND BLACK HILLS CORP /SD/ SD X X 01/13/04 BLACK HILLS CORP /SD/ SD X X 01/14/04 BLUE VALLEY BAN CORP KS X X X 01/14/04 BNP RESIDENTIAL PROPERTIES INC MD X X 01/13/04 BOND SECURITIZATION ASSET-BACKED CERT DE X X 12/25/03 BULL RUN CORP GA X X X 01/14/04 CAPITAL AUTOMOTIVE REIT MD X X 01/14/04 CAPITAL BANCORP INC TN X X X X 01/14/04 CAPITAL SENIOR LIVING CORP DE X X 01/13/04 CENTEX CORP NV X X 01/14/04 CEPHEID CA X 01/13/04 CHASE MORTGAGE FINANCE CORP DE X X 01/13/04 CHASE MORTGAGE FINANCE CORP DE X X 01/13/04 CHASE MORTGAGE FINANCE CORP DE X X 01/13/04 CHEC FUNDING LLC DE X 01/14/04 CHEC FUNDING LLC DE X 01/14/04 CHECKERS DRIVE IN RESTAURANTS INC /DE DE X 01/12/04 CHENIERE ENERGY INC DE X X 01/13/04 CHESAPEAKE ENERGY CORP OK X 01/13/04 CHINA ENERGY VENTURES CORP NV X X 10/27/03 AMEND CHIQUITA BRANDS INTERNATIONAL INC NJ X X 01/12/04 CITY NATIONAL CORP DE X X 01/14/04 CLEVELAND CLIFFS INC OH X X 01/13/04 COLLEGIATE FUNDING SERVICES EDUCATION DE X X 12/31/03 COMDIAL CORP DE X X 01/07/04 AMEND COMMERCE BANCSHARES INC /MO/ MO X 01/14/04 COMMUNITY BANCSHARES INC /DE/ DE X X 01/06/04 COMMUNITY TRUST BANCORP INC /KY/ KY X 01/14/04 CORDIA CORP NV X 01/07/04 CORDIA CORP NV X X 01/07/04 CREATIVE COMPUTER APPLICATIONS INC CA X X 01/14/04 CREDIT ACCEPTANCE CORPORATION MI X X 01/13/04 CRESCENT REAL ESTATE EQUITIES LTD PAR DE X X 12/31/03 DANAHER CORP /DE/ DE X 01/14/04 DECKERS OUTDOOR CORP DE X X 01/14/04 DELTA AIR LINES INC /DE/ DE X X 01/14/04 DIGITAL POWER CORP CA X X 01/12/04 DIVERSA CORP DE X 01/13/04 DOMINION RESOURCES INC /VA/ VA X X 01/12/04 DRUGSTORE COM INC DE X X 01/14/04 DVI RECEIVABLES CORP VIII DE X X 01/14/03 E MED FUTURE INC NV X X 12/30/03 EL PASO CORP/DE DE X X 01/14/04 ELIZABETH ARDEN INC FL X X 01/14/03 EMERITUS CORP\WA\ WA X X 12/31/03 EMERITUS CORP\WA\ WA X X 12/31/03 EPIX MEDICAL INC X X 01/13/04 EXCALIBUR INDUSTRIES INC DE X 12/31/03 F10 OIL & GAS PROPERTIES INC NV X X X X 01/07/04 FARMER MAC MORTGAGE SECURITIES CORP DE X 01/14/04 FARMER MAC MORTGAGE SECURITIES CORP DE X 01/14/04 FARMER MAC MORTGAGE SECURITIES CORP DE X 01/14/04 FARMER MAC MORTGAGE SECURITIES CORP DE X 01/14/04 FINLAY ENTERPRISES INC /DE DE X X 01/12/04 FINLAY FINE JEWELRY CORP DE X X 01/12/04 FIRST SECURITYFED FINANCIAL INC DE X X 01/12/04 FOREST OIL CORP NY X X 10/31/03 AMEND FRANKLIN AUTO TRUST 2003-2 DE X 01/14/04 FRANKLIN ELECTRIC CO INC IN X 01/13/04 FTI CONSULTING INC MD X 11/03/03 AMEND FULLER H B CO MN X X 01/13/04 GENCORP INC OH X X 01/12/04 GENENTECH INC DE X X 01/14/04 GENERAL GROWTH PROPERTIES INC DE X 10/14/03 AMEND GENESCO INC TN X 01/14/04 GENESIS TECHNOLOGY GROUP INC FL X 12/31/03 GINSENG FOREST INC X 12/30/03 GLOBAL ENERGY INC NV X X 01/13/04 GLOBAL PAYMENT TECHNOLOGIES INC DE X X 01/13/04 GRAFTECH INTERNATIONAL LTD DE X 01/14/04 GREATE BAY HOTEL & CASINO INC NJ X X 01/13/04 HAMPTON ROADS BANKSHARES INC VA X 01/14/04 HARBOR FLORIDA BANCSHARES INC DE X 01/14/04 HARTFORD FINANCIAL SERVICES GROUP INC DE X X 01/14/04 HARVEST NATURAL RESOURCES INC DE X X 01/08/04 HAWAIIAN ELECTRIC INDUSTRIES INC HI X 01/13/04 HEI INC MN X X 01/14/04 HI/FN INC DE X X 12/31/03 AMEND IHOP CORP DE X 01/12/04 INDIGINET INC/FL FL X X 12/30/03 INLAND WESTERN RETAIL REAL ESTATE TRU MD X X 01/06/04 INSITE VISION INC DE X X 12/30/03 INTEGRAMED AMERICA INC DE X X 01/14/04 INTEL CORP DE X 01/14/04 INTER PARFUMS INC DE X 01/14/04 INTERNET SECURITY SYSTEMS INC/GA DE X 01/13/04 JACKSONVILLE BANCORP INC IL X X 01/14/04 JEFFERSON PILOT CORP NC X 01/14/04 KNBT BANCORP INC PA X 10/31/03 AMEND KNOLOGY INC DE X X 12/31/03 KOSS CORP DE X X X 01/12/04 LABONE INC/ MO X 01/14/04 LAIDLAW INTERNATIONAL INC DE X X 01/13/04 LBI MEDIA HOLDINGS INC X 01/12/04 LECROY CORP DE X X 12/31/03 LESCO INC/OH OH X X X 12/30/03 LINEAR TECHNOLOGY CORP /CA/ DE X X 01/13/04 LORAL SPACE & COMMUNICATIONS LTD D0 X 01/10/04 M I HOMES INC OH X X 01/14/04 MADISON BANCSHARES INC FL X 01/13/04 MAGELLAN HEALTH SERVICES INC DE X X 01/13/04 MARCONI CORP PLC X0 X 01/14/04 MARSHALL & ILSLEY CORP/WI/ WI X X 01/14/04 MB FINANCIAL INC /MD MD X X 01/12/04 MDI TECHNOLOGIES INC DE X X 01/14/04 MEDIA & ENTERTAINMENT COM INC NV X X 01/12/04 MEDIANEWS GROUP INC DE X X X 01/14/04 MEDWAVE INC DE X X 01/09/04 MERRILL LYNCH & CO INC DE X 01/14/04 MERRILL LYNCH MORT INV INC ASST BACK DE X X 12/29/03 MERRILL LYNCH MORTGAGE INVESTORS INC DE X 01/13/04 METALDYNE CORP DE X X 12/31/03 MICHAEL ANTHONY JEWELERS INC DE X X 01/13/04 MIDWEST EXPRESS HOLDINGS INC WI X X 01/13/04 MOOG INC NY X X 01/14/04 MORGAN STANLEY DE X 01/14/04 MORGAN STANLEY DEAN WITTER CAPITAL I DE X X 01/13/04 MOTORCAR PARTS AMERICA INC NY X X 01/13/04 MPW INDUSTRIAL SERVICES GROUP INC OH X 01/14/04 NAPOLI ENTERPRISES INC CO X 01/12/04 NASSDA CORP DE X X 01/14/04 NATHANIEL ENERGY CORP NV X X 01/12/04 NATIONAL ENERGY GROUP INC DE X X 12/29/03 NETWORK COMMERCE INC WA X X 01/14/04 NETWORK EQUIPMENT TECHNOLOGIES INC DE X 12/26/03 NEW CENTURY FINANCIAL CORP DE X X 12/29/03 NEXSTAR BROADCASTING GROUP INC DE X X X 01/14/04 NITCHES INC CA X X 01/14/04 NUVELO INC NV X X 01/14/04 OCEAN RESOURCES INC DE X 01/13/04 ON SITE SOURCING INC DE X X 12/30/03 ONYX ACCEPTANCE CORP DE X X 01/13/04 PACIFIC FINANCIAL CORP WA X X 01/13/04 PARK CITY GROUP INC DE X 01/13/04 PARTNERS TRUST FINANCIAL GROUP INC X 01/14/04 PERFORMANCE TECHNOLOGIES INC \DE\ DE X 01/14/03 PHOENIX FOOTWEAR GROUP INC DE X 10/31/03 AMEND PHOTOGEN TECHNOLOGIES INC NV X 01/07/04 PLANAR SYSTEMS INC OR X X 01/14/04 PLANGRAPHICS INC CO X 01/14/04 PNM RESOURCES INC NM X 01/14/04 POLYDEX PHARMACEUTICALS LTD/BAHAMAS X X 01/13/04 PRIME GROUP REALTY TRUST MD X 01/14/03 PRIMUS TELECOMMUNICATIONS GROUP INC DE X X X 01/13/04 PROTECTION ONE INC DE X X 01/02/04 PS BUSINESS PARKS INC/CA CA X X 12/30/03 PURE WORLD INC DE X 01/14/04 QLOGIC CORP DE X 01/14/04 QUESTCOR PHARMACEUTICALS INC CA X 01/14/04 QUINTEK TECHNOLOGIES INC CA X X 01/02/04 RAYMOND JAMES FINANCIAL INC FL X X 01/14/04 RENAISSANCE MORT ACCEPT CORP HOME EQU DE X X 12/27/03 RENAISSANCE MORT ACCEPT CORP HOME EQU DE X X 12/27/03 RENAISSANCE MORT ACCEPT CORP HOME EQU DE X X 12/27/03 RES CARE INC /KY/ KY X 01/14/04 RESIDENTIAL ACCREDIT LOANS INC DE X X 01/14/03 RESIDENTIAL ASSET MORT PRO INC GMACM DE X X 12/15/03 RESIDENTIAL ASSET SECURITIES CORP DE X X 01/14/04 RESIDENTIAL FUNDING MORTGAGE SECURITI DE X X 01/14/04 RICA FOODS INC NV X X 01/13/04 RICHARDSON ELECTRONICS LTD/DE DE X 01/13/04 ROCKWELL COLLINS INC DE X X 01/13/03 RUSHMORE FINANCIAL GROUP INC TX X X 01/13/04 SALIX PHARMACEUTICALS LTD X X 01/14/04 SALOMON BROTHERS MORT SEC VII INC MOR DE X X 12/25/03 SALON MEDIA GROUP INC DE X X 12/30/03 SAN RAFAEL BANCORP CA X X 01/14/04 SANGUINE CORP NV X X 12/11/03 AMEND SAUCONY INC MA X 01/14/04 SELECT COMFORT CORP MN X X X 01/14/04 SEPRACOR INC /DE/ DE X X 01/12/04 SERVICE 1ST BANCORP CA X X 01/14/04 SERVICEMASTER CO DE X 01/14/03 SFBC INTERNATIONAL INC DE X 09/06/03 AMEND SHAW GROUP INC LA X X 01/14/04 SIERRA PACIFIC RESOURCES /NV/ NV X X 01/12/04 SL GREEN REALTY CORP MD X X 01/13/04 SOMANETICS CORP MI X 01/13/04 SONORAN ENERGY INC WA X X 12/19/03 SORRENTO NETWORKS CORP NJ X X 01/13/04 SOUTHERN CONNECTICUT BANCORP INC CT X X 01/13/04 STANDARD MICROSYSTEMS CORP DE X 01/14/04 STRUCTURED ASSET SEC CORP MORT PASSTH DE X X 12/30/03 SUNOCO INC PA X X X 01/14/04 SYNOVIS LIFE TECHNOLOGIES INC MN X X 01/14/04 TECHTEAM GLOBAL INC DE X X 12/31/03 THACKERAY CORP DE X 01/12/04 THAXTON GROUP INC SC X X 12/19/03 TIPPINGPOINT TECHNOLOGIES INC DE X X 01/05/04 TODD SHIPYARDS CORP WA X X 01/14/04 TRANSDIGM INC DE X X 01/13/04 TRIZETTO GROUP INC DE X 01/14/04 TROPICAL SPORTSWEAR INTERNATIONAL COR FL X 09/27/03 TTR TECHNOLOGIES INC DE X 01/14/04 UGOMEDIA INTERACTIVE CORP NV X X 01/06/04 UNIT CORP DE X X 01/13/04 UNITED STATES EXPLORATION INC CO X X 01/14/04 UNOCAL CORP DE X 01/13/04 URANIUM RESOURCES INC /DE/ DE X X 01/14/04 VANS INC DE X X 01/14/04 VENTURES NATIONAL INC UT X X 01/13/04 VICON INDUSTRIES INC /NY/ NY X X 09/30/03 VIDEO DISPLAY CORP GA X X 01/14/04 WADDELL & REED FINANCIAL INC DE X 01/14/04 WELLCHOICE INC DE X 01/14/04 WELLS FARGO ASSET SEC CORP MORT PASS DE X X 08/28/03 WELLS FARGO ASSET SEC CORP MORT PASS DE X X 12/25/03 WELLS FARGO ASSET SEC CORP MORT PASS DE X X 12/25/03 WELLS FARGO ASSET SEC CORP MORT PASS DE X X 12/25/03 WELLS FARGO ASSET SEC CORP MORT PASS DE X X 12/25/03 WELLS REAL ESTATE INVESTMENT TRUST IN DE X 12/18/03 AMEND WIRELESS FRONTIER INTERNET INC DE X X X X 01/13/04 WORKSTREAM INC X X 01/14/04 WORLD HEALTH ALTERNATIVES INC FL X X 12/24/03 AMEND XCEL ENERGY INC MN X X 01/13/04 XL CAPITAL LTD X X 01/13/04 XM SATELLITE RADIO HOLDINGS INC DE X X 01/13/04 XTO ENERGY INC DE X X 01/14/04 YAHOO INC DE X X 01/14/04 YP NET INC NV X X 01/14/04 Z TEL TECHNOLOGIES INC DE X 01/08/04 ZOLTEK COMPANIES INC DE X X 09/30/03