Section16Direct User s Guide

Transcription

1 Section16Direct User s Guide 1

2 This page intentionally left blank. 2

3 Table of Contents Overview of Section 16 Filings...5 Who is required to file?...5 Filing Deadlines...5 EDGAR System Hours of Operation...5 System Requirements and Recommendations...6 Computer Setup...6 Software recommendations...6 Home Page Overview...7 The Home Page Tool Bar...7 Direct Tasks Menu...7 Filing Lists...8 My Account Overview Setup Issuer(s) Setup Reporting Persons & User Names/Passwords Review/Update Billing Information Setup Securities Setup Holdings...20 Create A Filing From Scratch...25 Header Tab...26 Table I Non-derivative Securities or Holdings...30 Table II Derivative Holdings or Transactions...33 Footnotes...37 Signature and Remarks...41 Amended filing...41 Filing Proof Options...42 Review/Approval...43 Submit a Filing...46 Converting a Power of Attorney from a Word Document...48 Import SEC Filing...59 SEC Mail

4 Example of an SEC Acceptance Notice...61 Example of an SEC Suspension Notice...62 Examples of SEC Suspension Error Messages...63 Transaction Codes...64 Resources

5 Overview of Section 16 Filings Who is required to file? The SEC requires any Officer, 10% or more owner, and/or Directors to file Forms 3, 4, and 5. Some of these filings may occur during the Initial Public Offering ( IPO ) process. Please consult your legal counsel as to when your Section 16 filings are first due. Form 3: All Officers, 10% or more owners and Directors. Form 4: All inside trades or changes in ownership due within 48 hours of the transaction. Form 5: All insiders required to report annual holdings at least once a year. Filing Deadlines At the end of the filing day, all transmissions must be completed in order to be processed. Those transmissions that are processing at the end of the day will be terminated, requiring the filer to start over again the following day. In order to receive the current day's date, the transmission must be complete by 10:00 PM Eastern Time and the filing must be free from errors. To reduce the chance of missing a filing deadline, we recommend test filing first, and beginning the live filing process no later than 30 minutes before the deadline. EDGAR System Hours of Operation See EDGAR filing hours for US and International time zones at: 5

6 System Requirements and Recommendations Computer Setup Section 16 Direct runs with optimal performance using the Internet Explorer browser. You can download the latest version from The Firefox browser is not currently supported. If your company has a firewall in place, ask your IT staff to make sure that Ports 80 & 443 are open. Software recommendations Adobe Acrobat There is a Preview as PDF feature available in the Section 16 Direct application. If you have Adobe Acrobat Reader, you will be able to view and print the proof, but you will not be able to save it or it. You can download the latest version of Adobe Acrobat reader at no charge from: In order to save Forms in PDF format, you must have a full version of Adobe Acrobat or alternative PDF creation software installed. o o Note: If the version of Acrobat Reader installed on your PC does not match the version of the full Adobe Acrobat installed, you will be unable to generate a PDF proof. Do not upgrade Reader to a higher version number while running a lower version number of the full Acrobat as you may experience difficulty reading or creating PDFs in the future. Alternative PDF creation software can be found by searching the Internet for PDF creation software or similar. Some are available at no cost, while some may charge a nominal fee. PDF files are easy to to reviewers for approval before the corresponding form is filed with the SEC. Forms 3, 4 and 5 viewed in Acrobat format will conveniently print out on an 8 1/2" paper size. Section 16 users often print these PDF files and have them signed by the reporting owner to keep on file for the required five years (Rule 16a-3(i)). 6

7 The Home Page Tool Bar Home Page Overview Home: The Home Page is your starting place for filing preparation. Functions on this page include the Direct Tasks Menu, Filings in Process, Previously Filed and Import Filings. My Account: Provides access to Issuer, Reporting Owner, Administrator and Holdings Management information. Help: Provides an overview of Section 16 filings. Logout: Discontinues the user s session and disconnects from the Section16Direct server. Contact Us: Phone numbers and addresses to obtain technical support. Direct Tasks Menu CREATE a New Filing. There are two ways to create a new form: from scratch or from holdings (the holdings management feature.) SEARCH for Existing Filings allows the user to search filings previously submitted through Section16Direct. MANAGE Insider Holdings for each Reporting Owner. An option to manage an Insider s individual holdings and transaction data. IMPORT SEC Filing brings in a previously disseminated filing from the SEC. 7

8 Filing Lists This is the main storage area for Section16Direct. Filings in Process will include all filings you have begun or copied to use, but have not yet Live Filed (documents stored for editing and future filing). Submissions you have Live Filed, whether they were accepted or suspended, will move to the Previously Filed Section. Be sure to check that your submission was accepted. Submissions you have imported will be placed in the Imported Filings section. You can expand/contract all lists at once by clicking Open All or Close All. Each arrow can also be clicked individually. The arrows next to each heading will point to the right if the respective list is empty or contracted. The arrows will point down if the respective lists are expanded, whether or not there are entries to display. 8

9 Filings in Process List Options available under the Filings in Process list include: Open an existing filing by clicking on the Reporting Owner s name. Delete a filing by clicking on the icon. Copy a filing by clicking on the icon. Those with Accession Number Links have been test filed. You can edit the filing by clicking on the Insider s name. You can quickly check on the status of your filings in process. A submission that has been Test Filed will contain one of three Icon indicators to the left of the Name column: The hour glass indicates that the SEC is processing your Test Filing. The check box indicates an accepted Test Filing. The exclamation indicates a Suspended Test Filing. Previously Filed List Any submissions that have been live filed, whether they were accepted or suspended, will be moved to this list. Options under the Previously Filed list include: SEC Status: Verify the status of a filing, Suspended or Accepted. Delete a filing by clicking on the icon. Copy a filing by clicking on the icon. It will then appear under the Filings in Process list. Imported Filings List Filings imported from the SEC will appear here. Options under the Imported Filings List include: SEC Status: Verify the status of a filing, Suspended or Accepted. Delete a filing by clicking on the icon. Copy a filing by clicking on the icon. It will then appear under the Filings in Process list. 9

10 My Account Overview The My Account area is the data management center for the Issuers, Insiders, Administrators, and Account Information. To access this area, click on My Account on the Home Page tool bar. There are five features under My Account: 1. Setup Issuer(s): Provides access to Issuer information. The Issuer is the company whose stocks have been bought or sold for the filing. 2. Setup Reporting Persons & User Names/Passwords: Provides access to the data for the Insider, Administrator, and Reviewer information. Options available in this area include: add a new insider (reporting person), edit existing information, delete a reporting person, or reset the status of an individual. The Insider is a Reporting person. By default, they do not have access to the system. A user must be granted access to the system as either an Administrator or a Reviewer. The Administrator has access to all areas on Section16Direct; setup new reporting persons/reviewers, data entry in the My Account Area, create filings, and transmitting to the SEC. There can be multiple Administrators per account. Reviewers have read-only access to the filings that an Administrator has specifically assigned to them. This permission can also be granted to insiders if they wish to review and comment on their filings within the system. 3. Review and Update Billing Information: Access to billing information that was entered when the account was initially setup. 4. Setup Securities: Access to information entered on securities offered to insiders. Securities must be set in system before Holdings can be set up. 5. Setup Holdings: Access to the Holdings Management information that has been entered to manage the Insider s individual acquisitions and sales. Holdings are setup for each Insider. Once this is done, the information can be used to generate transaction information that can then be automatically populated into a form for filing. TIP: The Issuer and Insider information must be set up prior to creating a filing 10

11 1. Setup Issuer(s) The following functions can be performed under the Setup Issuer(s) option: If changes are required, see Edit Existing Issuer.) Add a New Issuer 1. Select Add New. 2. Enter the required (in bold) information: Issuer Name, Submission Contact (select from the drop down menu), Issuer CIK, and Ticker Symbol. 3. Click Save. Edit Existing Issuer In some instances, it may be necessary to update the Issuer s information. (If filings were imported from the SEC, much of the Issuer data would have been imported already. Always verify that the data is correct.) To edit the Issuer s information, follow these steps: 1. Select Setup Issuer(s). 2. Edit the Issuer s information by clicking on their name in the list. 3. Make any necessary changes. 4. Scroll to the bottom of the screen and click Save. 11

12 Change an Issuer s Status to Inactive Tip: If an Issuer is deleted, all related records in the Section16Direct system will be deleted, so it may be advisable to simply set their status to Inactive. Issuer status may be reset to Inactive by following these steps: 1. Select Setup Issuer(s). 2. Edit the Issuer s information by clicking on their name in the list. 3. Change the Status in the drop-down box to Inactive. 4. Scroll to the bottom of the screen and click Save. 12

13 2. Setup Reporting Persons & User Names/Passwords Adding a New Insider 1. Click Add New. 2. Enter all the information (bold fields are required) along with the relationship to the Issuer and Signature. Be sure to check the box next to Insider. Failure to do so will result in a loss of information upon saving. If a Reporting Person is to have access to the system to review filings before submission to the SEC, check the box next to Access to System. Assign them a User Name, Password, and Reviewer role. 13

14 Adding a New Administrator 1. Click Add New. 2. Fill in the bold items in the Person Information section. 3. Check the box next to Access to System and assign a User Name and Password. 4. Select the role as Administrator. 5. Scroll down and click Save. Add New Reviewer 1. Click Add New. 2. Fill in the bold items in the Person Information section. 3. Check the box next to Access to System and assign a User Name and Password. 4. Select the role as Reviewer. 5. Scroll down and click Save. Delete Existing Insiders or Administrators 1. Select the Name of the Administrator or Insider to open their information for editing. 2. Scroll to the bottom of the screen and select Delete. Note: Deleting an Insider removes all their records from the Section16Direct system. Consider simply setting their status to Inactive. Edit Existing Insiders, Reviewers or Administrators 1. Select the Name of the Insider, Reviewer, or Administrator to open their information for editing. 2. Make any necessary changes. 3. Scroll to the bottom of the screen and select Save. Note: If an update is made in the My Account area which relates to a filing that is open, you will need to click Update All on the header page of the filing to pull in the most current data, and click Save. 14

15 3. Review/Update Billing Information This section can be used to change information that was originally entered when the account was setup. Make the changes and then select Save. 15

16 4. Setup Securities Set Up Securities and Setup Holdings are optionally used to input and store information about the holdings and securities that can then be accessed from the Home Page under Manage Holdings and create filings from the stored data. If you wish to manage holdings data in Section 16 Direct, the securities for the Issuer must be setup first. Note: This area is only necessary to use if you wish to manage securities and holdings data via Section 16 Direct. If you store your data in a separate application, then there is no need to re-enter it here to complete filings. This area manages securities applicable to the Issuer. New securities may be entered or existing data may be edited for both the non-derivative (Table I) and derivative (Table II) shares. The next section (Setup Holdings) allows information to be added or edited for a Reporting Person with securities setup. Add New Security 1. Securities in Holdings Management may be accessed from two different areas: In the My Account area, select number 4 to Setup Securities, or When in the My Account area, select number 1 for Setup Issuer. Move cursor over an existing Issuer name and click to select. Click on the Securities button at the bottom of the screen. 2. After selecting Setup Securities, select the Issuer from the drop down list. 3. Click on Manage Securities button. 16

17 A1. To enter information for a Non-Derivative Security, click on the New button in the Non-Derivative (Table I) area. A2. In the popup window, enter the Title of Security and a unique Short Name (both required). Note the blue text of Title of Security contains a hyperlink to the corresponding SEC requirement for that field. A3. After you have entered the required data, click OK and the data will appear in a row under the Non-Derivative (Table I) heading. A4. Confirmation text will appear at the top of the screen New Security Added. 17

18 B1. To enter information for a Derivative security, click on the new button in the Derivative (Table II) area. B2. Place the cursor in each required box and enter data. Title of Security, Short Name, Underlying Security, and Underlying Amount are all required fields. (For descriptions and valid values of each field, see Building the Table under Create A Filing From Scratch section of this guide). Note: All of the fields in blue text contain hyperlinks to the corresponding SEC information for that field. B3. After you have entered the required data, click OK and the data will appear formatted in a row under the Derivative (Table II) heading. Tip: The most common value for Underlying Securities Amount is the number 1. As a result, a 1-to-1 ratio between the derivative (option) and non-derivative (common stock) is defined. 18

19 Delete an Existing Security To delete an existing Security, click the X in the Del column. A confirmation window will pop up next. Click Yes, do the delete to delete the security. 19

20 Edit Existing Security To edit a Security, click the E in the Edit column. Make the changes in the resulting pop up box: Click OK to complete the change. 5. Setup Holdings Add New Holdings 1. Holdings management may be accessed from three different areas: On the Home Page, in the Direct Tasks Menu, move cursor over Manage Insider Holdings and double click. In the My Account area, select 5. Setup Holdings, or When in the Setup Account for a Reporting Person, select the Holdings button on the bottom of the screen. 20

21 2. After accessing holdings in one of those ways, this screen will pop up: Select an Insider from the drop-down box, and then click Manage Holdings. 3. On the next screen, click Select New Issuer. 21

22 4. Use the drop down window to select the Holding Issuer. Select the radio button to indicate Non-Derivative or Derivative, and then click Add a Holding. 6. In the pop up window, select the (Short) name of the security using the drop down box. (This Short Name was created in the Securities Setup). Enter the number of shares currently held and the Nature of Ownership. Note: If the Nature of Indirect Beneficial Ownership is explained in a footnote, simply type in See Footnote. The footnote text will be added later when the actual form is generated. The Nature of Indirect Beneficial Ownership always requires text in the box even when attaching a footnote. 7. When finished, click OK. 22

23 8. The new Holding has been added. To add another Holding, click the icon in the title row as shown below: To Delete a Holding, click the icon. To Edit a Holding, click the icon. To Add a Transaction, click the icon. Fill in the details of the holding and click the OK button. Repeat this step for each additional holding. 23

24 Generate a New Draft from Holdings 1. Click on Start New Draft Form dropdown, and then select the form type. 2. Check the white box(es) of any transaction to be added to the draft. 3. To report the running tally of transactions, click on {commit}*. *HELPFUL HINT: Think before you commit! If a transaction needs to be changed after commit has been chosen, the total of the Holdings will need to be manually edited to reflect the correct balance. 4. Click on Generate Draft. A pop up box will appear stating that your file has been saved. Click OK. 5. Go back to the Home Page, and the new filing will appear under Filings in Process with the current day s date and time stamp. To open the filing, click on the Insider s name for this filing. 6. The Header and Table(s) will have the data automatically populated. Any necessary changes can be edited at this time or it may be filed. Continue filing instructions under Create A Filing From Scratch. 7. After the filing has been accepted, return to this page and commit the transaction, if not previously done in step 3. 24

25 Create A Filing From Scratch From the drop-down boxes located in the Direct Tasks menu on the Home page: 1. Select Form 3, 4 or 5: 2. Select the Issuer: 3. Select the Reporting Owner: 4. Click on the Create button to start the form. 25

26 Header Tab The header tab has three areas of information: Issuer Information, Date Information, and Reporting Owner(s) Information. Issuer Information Note: Text in blue is linked to helpful information, directly from the SEC. For example: clicking on the CIK link in the Issuer Information section yields this popup: The CIK and trading symbol will populate automatically from the data stored in the My Account Area. If the issuer needs to be changed, choose Select an Issuer using the drop down option. 26

27 Date Information Today s date is automatically entered. This can be changed simply by typing over the date and selecting lock date. Date of Earliest Transaction Enter the date of the earliest transaction required to be reported. Date entered must be in the format MM/DD/YYYY and cannot be a date in the future. Date Original Filed Enter the date original filed. Date entered must be in the format MM/DD/YYYY and cannot be a date in the future. This field is only available for amendments. Sample Value: 09/05/2009. Amended filing If the filing is an amended submission, check the box next to This is an amended filing (Type 4/A), enter the Date Original Filed, and select lock date. This action will change the submission type to an amended filing. Prior to submitting an amended filing live, review the header to confirm the dates are correct and the lock date box remained locked. 27

28 Reporting Owner(s) Information The Name, CIK, CCC, and Relationship to Issuer information have been imported from the information entered in the My Account area. To change the Reporting Owner, first click the blue X to delete the entry. Next, select a new Reporting Owner from the drop down box, and then click Update All to pull in complete information from the My Account area for this filing. To add Co-Registrants, select a reporting owner from the drop down box and click Update All. SEC rules allow up to 10 co-registrants per filing. Updating changed Insider information If a Reporting Owner s information changes (i.e. address, CCC), the updated information needs to be entered in the My Account area for that individual. If you have filing in progress while you have made changes, you ll need to click the Update All button to pull the new information into the filing from the My Account entries. 28

29 No longer Subject to Section 16 Check this box if the Reporting Owner is no longer subject to Section 16. The obligation to file Forms 4 or 5 may continue according to Instruction 1(b). A reporting person no longer subject to Section 16 of the Securities Exchange Act of 1934 ( Exchange Act ) must check the exit box appearing on this Form. However, Form 4 and 5 obligations may continue to be applicable. See Rule 16a-3 (f); see also Rule 16a-2(b) (transactions after termination of insider status). Form 5 transactions to date may be included on this Form and subsequent Form 5 transactions may be reported on a later Form 4 or Form 5, provided all transactions are reported by the required date. 29

30 Table I Non-derivative Securities or Holdings Building the Table Text is entered on the upper part of the screen. Place cursor in Title of Security box and enter data. Continue entering through the end of the table. When finished, select OK to transfer the completed entry to the table in the lower portion of the screen. To enter another transaction or holding, repeat these steps. The SEC allows up to 30 lines of data per table. Fields with one * are required. Fields with two** require a footnote if the field is left blank. The Move Up/Move Down switches will change the order of the transactions within the table. To delete a row, click the X. To edit a row, click the E. The text will be transferred back up into the upper part of the screen where changes can be made. When you re finished editing, click OK and the updated text will be transferred back to the table. 30

31 Table 1 Column Header Description and Valid Values X= required field for this Form type Form 3 Form 4 Form 5 Field Title Description and Valid Values Transaction Referenced Field X X X Title of Security Enter the title of the security (up to 60 characters). The title entered should clearly identify the class. Sample Value: Class A Common Stock X X Transaction Date Enter the transaction date. Date entered must be in the format MM/DD/YYYY and cannot be a date in the future. Sample Value: 01/01/2003 X X Deemed Execution Date Enter the deemed execution date. Date entered must be in the format MM/DD/YYYY. Sample Value: 01/01/2003 X X Transaction Type Select the radio button which identifies the transaction type. (Holding, transaction or reporting early.) X Is the Reporting of Transaction Delinquent? Form 3 Holding will remove all references to a transaction. It is used to report historical actions with no current transaction date. Form 4 Transaction is the most commonly used and is for basic transaction reporting Form 5 Transaction reported early indicates that the insider is voluntarily reporting a transaction and places the V code in column 3, but this will only appear in the preview prior to filing. Select 'Yes' if this is a Form 5 transaction being reported early. Select 'No' if it is not. X X X X X Transaction Code Select the transaction code from the pulldown list. Use the code that most appropriately describes the transaction. For a list of the descriptions for each of the transaction codes, see or Section16Direct Resources at the end of this guide. X X X Does this transaction involve an equity swap X X Securities Acquired or Disposed Of Select 'Yes' if this transaction involves an equity swap. Select No if it does not. If Yes is selected, a "/K" will be appended to the transaction code. Note: The /K will only appear when the Form is previewed in HTML by selecting the Preview option next to the Submit button. Select the radio button which states if the securities where acquired or disposed. X X X X Amount in Shares Enter the amount of securities acquired or disposed of (up to 20 digits)'. The value entered should be in shares. Valid values range from 0 to 999,999,999, X 31

32 Form 3 Form 4 Form 5 Field Title Description and Valid Values Transaction Referenced Field X X Price Enter the price of the securities acquired or disposed of (up to 20 digits). The value entered should be in U.S. Dollars. Valid values range from 0 to 999,999,999, X X X X Amount of Securities Beneficially Owned Following Reported Transaction(s Enter the amount of securities beneficially owned (up to 20 digits). The value entered should state the number of equity securities or the face amount of debt securities in U.S. Dollars, whichever is appropriate. Valid values range from 0 to 999,999,999, X X X Ownership Form Select the radio button which identifies "Direct" or Indirect" ownership.if 'Indirect' is selected, the nature of the indirect beneficial ownership should be entered in the field below. X X X Nature of Indirect Beneficial Ownership This field requires an entry if "Indirect" was selected above. An explanation in a footnote is an option, enter "See footnote" as a place holder. Enter the nature of the indirect beneficial ownership (up to 100 characters). The value entered should be as specific as possible. Attaching a Footnote Footnotes need to be attached to a line entry before they can be saved. When creating an entry, select the Footnotes tab: (See detailed instructions for adding a Footnote) 32

33 Table II Derivative Holdings or Transactions Building the Table Text is entered on the upper part of the screen. Place cursor in Title of Security box and enter data. Continue entering data through the end of the various fields. When finished, select OK to transfer the completed entry to the table below. To enter another transaction or holding, enter the data in the blank upper part of the screen, select OK, and the new data will appear in the table below in the order it has been entered. The SEC allows up to 30 lines of data per table. To change the sequential order within the table, use the up/down arrows on the far right side of the table, moving one line at a time. Fields with one * are required. Fields with two** require a footnote if the field is left blank. 33

34 The Move Up/Move Down switches will change the order of the transactions within the table. To delete a row, click the X. To edit a row, click the E. The text will be transferred back up into the upper part of the screen where changes can be made. When you re finished editing, click OK and the updated text will be transferred back to the table. 34

35 Table 2 Column Header Description and Valid Values X= available field for this Form type Form 3 Form 4 Form 5 Field Title Description and Valid Values Transaction Referenced Field X X X Title of Derivative Security * X X Conversion or Exercise Price of Derivative Security ** Enter the title of the security (up to 60 characters). The title entered should clearly identify the class. Sample Value: Class A Common Stock Enter the conversion or exercise price of the derivative security (up to 20 digits). Valid values range from 0 to 999,999,999, X X Transaction Date * Enter the transaction date. Date entered must be in the format MM/DD/YYYY and cannot be a date in the future. X X Deemed Execution Date, if any Enter the deemed execution date. Date entered must be in the format MM/DD/YYYY. X X Transaction Type Select the radio button which identifies the transaction type. (Holding, transaction or reporting early.) Form 3 Holding will remove all references to a transaction. It is used to report historical actions with no current transaction date. Form 4 Transaction is the most commonly used and is for basic transaction reporting Form 5 Transaction Reported Early indicates that the insider is voluntarily reporting a transaction and places the V code in column 3, but this will only appear in the preview prior to filing. X X Transaction Code Select the transaction code from the pull down list. Use the code that most appropriately describes the transaction. For a list of the descriptions for each of the transaction codes, see or Section16Direct Resources at the end of this guide. X X X X Is the Reporting of Transaction Delinquent? Select 'Yes' if this is a Form 5 transaction being reported early. Select 'No' if it is not. X X X Does this transaction involve an equity swap? Select 'Yes' if this transaction involves an equity swap. Select No if it does not. If Yes is selected, a "/K" will be appended to the transaction code. Note: The /K will only appear when the Form is previewed in HTML by selecting the Preview option next to the Submit button. X 35

36 Form 3 Form 4 Form 5 Field Title Description and Valid Values Transaction Referenced Field X X Number of Derivative Securities Acquired or Disposed of Select the radio button indicating whether the derivative securities were acquired or disposed. X X X Number (in Shares) * Enter the number of derivative securities acquired or disposed. The value entered should state the number of equity shares or the face amount of debt securities in U.S. Dollars, whichever is appropriate. Valid values range from 0 to 999,999,999, X X X X Date Exercisable ** Enter the date exercisable. Date entered must be in the format MM/DD/YYYY. X X X Expiration Date ** Enter the expiration date. Date entered must be in the format MM/DD/YYYY. X X X Title and Amount of Underlying Securities * X X X Amount or Number of Shares ** Enter the title of the underlying securities (up to 60 characters). The title entered should clearly identify the class. Enter the amount of underlying securities (up to 20 digits) and select the radio button indicating either "US Dollars" or "Number of Securities". The value entered should be in shares. Valid values range from 0 to 999,999,999, X X X Price of Derivative Security ** X X Number of Securities Beneficially Owned Following Reported Transaction(s) * Enter the price of the derivative security (up to 20 digits). The value entered should be in U.S. Dollars. Valid values range from 0 to 999,999,999, Enter the number of derivative securities beneficially owned following reported transactions (up to 20 digits). The value entered should state the number of equity securities or the face amount of debt securities in U.S. Dollars, whichever is appropriate. Valid values range from 0 to 999,999,999, X X X X Ownership Form of Derivative Security Select the radio button which identifies "Direct" or Indirect" ownership.if 'Indirect' is selected, the nature of the indirect beneficial ownership should be entered in the field below. X X X Nature of Indirect Beneficial Ownership This field requires an entry if "Indirect" was selected above. An explanation in a footnote is an option, enter "See footnote" as a place holder. Enter the nature of the indirect beneficial ownership (up to 100 characters). The value entered should be as specific as possible. 36

37 Footnotes Footnotes must be attached to a line entry before they can be saved. To create a footnote, select the footnote tab. 1. Enter the footnote text in the box below New Footnote Text : One thousand characters, (including spaces) are allowed. 37

38 2. When you're finished entering text, click Add Footnote. The text is now displayed under Explanation of Responses. The system automatically assigns the naming convention, starting with F1, F2, etc. To delete a footnote, click the X. To edit a footnote, click the E. The text will be transferred back up into the New Footnote Text box where changes can be made. When you re finished editing, click Add Footnote and the updated text will appear under Explanation of Responses. It is recommended that the data for the footnote is hand-typed or copied from a text file (Notepad), and pasted into the new footnote box. MS Word and other editors may contain non-compliant characters that can cause your filing to suspend. 38

39 3. Return to the Table to add the footnote to a line entry by selecting the appropriate Table tab. 4. Click the Footnotes button next to the text that should have the footnote. From the drop down box, select the footnote to attach by moving the cursor over the footnote description and clicking on it. 39

40 5. The footnote reference appears next to the text box, indicated by a blue x on the lower right hand side and the footnote number located on the upper right hand side. To delete a footnote, click the blue x below the box. 6. Next, click OK to save the transaction into the table at the bottom of the page. 40

41 Signature and Remarks The signature auto-populates from the information stored in the My Account area. If the signature or date needs to be changed on the form, move the cursor to the box and type the new information. Changes on this page only affect this filing and will not alter the information in the My Account area. Signature of Reporting Person: up to 255 characters allowed. Date: Enter the date of the reporting person's signature. Date entered must be in the format MM/DD/YYYY and cannot be a date in the future. The Remarks field can be used to enter a footnote that applies to the entire form. The SEC allows up to 2,000 characters (Including spaces) to be entered. Amended filing If the filing is an amended submission, indicate on the Header Tab by checking the box next to This is an amended filing (Type 4/A), then, enter Date Original Filed, select lock date, and Save. This action will change the submission type to an amended filing. Prior to submitting an amended filing live, review the header to confirm the dates are correct and the lock date box remained locked. 41

42 Filing Proof Options The Filing Proof Option Features are located on each tab in the upper right side. Save The save button to the right of the Signature tab saves the changes made within the Form. Save As The Save As button copies filings. This option can be used to copy filings in process, previously filed documents filed on Section16Direct, or Imported Filings. After Save As has been selected, return to the Home page to begin working on the new filing. Preview To Preview an HTML version of your filing, click on the Preview link. This version is the most accurate proof and representation of what is disseminated at the SEC. To print it out, set printer properties to Landscape and Legal paper. Preview As PDF To Preview an Adobe PDF of your filing, click on the Preview as PDF link. The full Adobe suite must be available for this feature to function correctly. 42

43 Review/Approval Assign Reviewers Reviewers must first be entered into Section16Direct by the System Administrator. This is done under My Account Setup/Reporting Persons & User IDs/Passwords where the individual is entered and assigned access to the system with a Role of Reviewer. 1. When creating a new form, select Assign Reviewers (located below the Submit button) for the list of reviewers in the system. Individuals entered with the Role of Administrator can also be Reviewers. Click the Add button. When all the desired Reviewers have been selected, click the Save button and close the window. 43

44 2. To enter comments, type text in the lower box and click on the Add Comments button. 3. To delete comments, click on the Delete Comments button. All Comments will be deleted! 4. When the form is ready to be sent to the Reviewer(s) for approval, click on the Notify Reviewer button in the upper right hand corner (below the submit button). 5. The following box will pop up: 6. Type any note for the Reviewer(s) in the box and click on Notify Reviewers box. 7. The following confirmation appears: notification has been sent to all Reviewers. Click OK. 8. The Reviewers will receive the following . The first paragraph is constant in all reviewer s, the second paragraph includes the recently created comments by the Administrator and the last paragraph links the Reviewer directly to the filing after they log in to Section16Direct. You have been added to the review list for an SEC filing. Please click on the link below, login and review the form. If you have any questions, contact your account administrator. please reply - testing reviewer Go to to review the filing. 44

45 Action By Reviewer: The Reviewers will be able to view only filings which they have been designated as the Reviewer. The Form will display on the Home Page under Filings in Process. Click the Form to open and review. At the bottom of the page is the Reviewer section. This area is not part of the SEC filing and will not be included when the filing is sent to the SEC. The Reviewer can add any comments for the Administrator or other Reviewers of the form to see. Comments are not required. The Reviewer then has the option to Approve or Defer Approval of the form by selecting the corresponding button. The decision of when to submit the filing to the SEC is up to the Administrator. Note: Section16Direct will issue a warning message if all Reviewers have not approved the form, but will not prevent an Administrator from submitting a form to the SEC without all Reviewers' approval. 45

46 Submit a Filing 1. To submit a filing, click on the Submit button. 2. The next screen confirms the Header information and provides the option to upload an attachment. Any exhibit included with a Section 16 Filing must be formatted to SEC compliant HTML or ASCII specifications. If no attachments are required, skip steps 3 and To attach a Power of Attorney (or other exhibit), click on Upload Attachment and the following window will display. (See SEC attachment specifications in the Converting a Power of Attorney from a Word Document instructions on page 47.) 4. Click on the browse button to review the list of available documents. Double click on the txt.file name to be attached, which will then display in the File Name window. Click on the Upload button in the lower left hand corner to complete the attachment. The following window will appear confirming the file name and file type which has been attached to this submission. 46

47 5. Click on the Submit button and the following box will popup. 6. Select the Submit to SEC button to send your Test or Live filing to the SEC. Section16Direct defaults to Test filing. When ready to submit Live, click on the radio button to the left of Live. 7. Automatically the system will return to the Home page with a similar message: Your filing has been submitted. Your accession number is You will receive an from the SEC with additional information. 8. The SEC will send an Accession Message to verify the final status of the filing. A Test filing is recommended to check the SEC compliant formatting against the EDGAR submission. There is no limit to the number of tests sent to the SEC. 47

48 Converting a Power of Attorney from a Word Document If you need to include a Power of Attorney (POA), the document must be converted to an SEC-compliant format. Follow the instructions below to create an SEC-compliant POA in ASCII format. Instructions are included for Word and Word The POA document is attached as an Exhibit 24 to a Form 3, 4, or 5 filing. Using a Microsoft Word Document: 1. Create or open the Power of Attorney in Word. First check for tab characters, data in the header/footer, and graphic signatures. Tab characters Replace tab characters with a desired amount of space using the spacebar. You can see tabs by clicking the paragraph symbol on the Standard toolbar. (Tab characters appear as small right arrows. Spaces appear as raised dots between words). 48

49 Header/Footer Text If there is necessary data in the Header/Footer, move the text into the body of the document. (Text in the header/footer appears gray when in Print Layout view.) Click View/Header and Footer to be able to select text from the header or footer.) Select the text, cut it (Ctrl+X), then click outside of the header/footer to return to the body of the document. (When you re viewing the header/footer, the text outside of the header/footer will appear grayed out.) Position cursor where the text needs to be placed, then paste (Ctrl+V) the text. Signatures Ensure that the signature is typed. Graphic signatures are not allowed. Conform signature, as needed, using /s/ (e.g., /s/ John Jones). 49

50 2. Clear all Formatting Highlight all text in the document. If your cursor is anywhere in the document, you can press Ctrl+A to select all of the data, or click Edit/Select All. Once the data is selected, click Format/Styles and Formatting... Another box will open. Double click on Clear Formatting. 50

51 3. Change the font to Courier New and font size to 10 or 12 point. With the entire document still selected (Ctrl+A), change the font to Courier New and the font size to 10 or 12 point. 4. Format the margins. Click File/Page Setup. Set the left and right margins to 1.5 inches. 5. Save the document as plain text and name it accordingly. Click File/Save As... Determine where the document will be saved by clicking on the location icon (e.g., my Desktop or My Documents). 51

52 File name: Recommended naming convention example: ex24lastname (ex24 references exhibit24, which is the power of attorney document). No spaces, dashes or underlines may be used in the file name or it will suspend when filing with the SEC. Save as type: Scroll down to Plain Text (*.txt) and click Save. The File Conversion window appears. Check the box Insert line breaks. This will add line endings where the text breaks within the 1.5 inch margins that you set earlier. Check the box Allow character substitution. This will change any non-ascii characters to their ASCII equivalents (e.g., smart quotes and apostrophes to straight quotes and apostrophes, em dashes to hyphens, etc.). Click OK. The file is now saved to your desired location (e.g., desktop or My Documents) and is ready to be uploaded as an attachment to the filing. Remember, the power of attorney document will need to be reattached after the Test filing, prior to filing Live. 52

53 Using a Microsoft Word 2007 Document: 1. Create or open the Power of Attorney in Word. First check for tab characters, data in the header/footer, and graphic signatures. Tab characters Replace tab characters with a desired amount of space using the spacebar. You can see tabs by clicking the paragraph symbol on the Paragraph toolbar, under the Home tab. (Tab characters appear as small right arrows. Spaces appear as raised dots between words). 53

54 Header/Footer Text If there is necessary data in the Header/Footer, move the text into the body of the document. (Text in the header/footer appears gray when in Print Layout view.) Double click the header/footer text to be able to select it. Sel ect the text, cut it (Ctrl+X), then click Close Header and Footer to return to the body of the document. (When you re viewing the header/footer, the text outside of the header/footer will appear grayed out.) Position cursor where the text needs to be placed, then paste (Ctrl+V) the text. Signatures Ensure that the signature is typed. Graphic signatures are not allowed. Conform signature, as needed, using /s/ (e.g., /s/ John Jones). 54

55 2. Clear all Formatting Highlight all text in the document. If your cursor is anywhere in the document, you can click Ctrl+A to select all of the data, or click Editing/Select/Select All from the Home tab. Once the data is selected, click the arrow at the bottom right corner of Styles Another box will open. Click on Clear All. 55

56 3. Change the font to Courier New and font size to 10 or 12 point. With the entire document still selected (Ctrl+A), change the font to Courier New and the font size to 10 or 12 point. 4. Format the margins. Click the Page Layout tab, then click Custom Margins... Set the left and right margins to 1.5 inches. 56

57 5. Save the document as plain text and name it accordingly. Click File/Save As... Determine where the document will be saved by clicking on the location icon (e.g., my Desktop or My Documents). File name: Recommended naming convention example: ex24lastname (ex24 references Exhibit 24, which is the power of attorney document). No spaces, dashes or underlines may be used in the file name or it will suspend when filing with the SEC. Save as type: Scroll down to Plain Text (*.txt) and click Save. The File Conversion window appears. Check the box Insert line breaks. This will add line endings where the text breaks within the 1.5 inch margins that you set earlier. 57

58 Check the box Allow character substitution. This will change any non-ascii characters to their ASCII equivalents (e.g., smart quotes and apostrophes to straight quotes and apostrophes, em dashes to hyphens, etc.). Click OK. The file is now saved to your desired location (e.g., desktop or My Documents) and is ready to be uploaded as an attachment to the filing. Remember, the power of attorney document will need to be reattached after the Test filing, prior to filing Live. 58

59 Import SEC Filing Import SEC Filing is used to copy existing data from a filing. This means the submission you want to import must be on your computer to be imported. This option could be used if you have a filing in your records that has been filed with the SEC. It must be an XML document. It will populate the My Account area, but if there is data already in the My Account area it will be overwritten by the downloaded data. To import a previously filed document, open a web browser and go to 1. Select Search for Company Filings located in the Filings and Forms area: 2. Choose the Companies or fund name... option: 3. Enter the name or CIK in the respective field. Click Only on the last field and Ownership Forms 3, 4, and Click on the link to the filing. 59

60 5. Scroll past the submission header information to the.xml document. Right click on the document link. 6. When the dialog box appears, choose the "Save Target As" option. Save it to your desktop for easy reference. 7. On your Section16Direct window, click Home to go to the Section16Direct Homepage. 8. Choose the Import SEC Filing option. 9. When the Import a Filing Box renders, click browse to search for the filing just as you would look for a document to attach to an After you have selected your document. Click upload and then the filing will appear in the Imported Filings section on the Home page. In order to edit this filing for future use, you will have to copy it first. Copy a filing by clicking on the icon. This will place a copy in the Filings in Process list. See Filings in Process List for more information. 60

61 SEC Mail The SEC sends a message from edgar-postmaster@sec.gov. to the address(es) set up in the My Account Area for the Insider filing. The Acceptance Message for a Test filing verifies that tagging requirements were met; for a Live filing, that the filing has been accepted and disseminated. Suspension messages report the specific coding error(s) in the filing. Example of an SEC Acceptance Notice The subject line will read: ACCEPTED FORM TYPE XXXXXXXXXX ( Accession number) THE FOLLOWING SUBMISSION HAS BEEN ACCEPTED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION. *** TEST FILING *** NOT AN OFFICIAL FILING *** TEST FILING *** COMPANY: XXXXXXXXXX FORM TYPE: XXXXXXXXXX NUMBER OF DOCUMENTS: 1 RECEIVED DATE: 19-Jun :41 ACCEPTED DATE: 19-Jun :41 TEST FILING: YES CONFIRMING COPY: NO ACCESSION NUMBER: FILE NUMBER(S): THE PASSWORD FOR LOGIN CIK WILL EXPIRE 10-Jul :59. PLEASE REFER TO THE ACCESSION NUMBER LISTED ABOVE FOR FUTURE INQUIRIES. REPORTING OWNER(S): 1. CIK: OWNER: MERRILL CORPORATION/FA FORM TYPE: XXXXXXXXXX FILE NUMBER(S): ISSUER: 2. CIK: XXXXXXXXXX COMPANY: XXXXXXXXXX NOTICE URGENT: Verify that all of your addresses on the EDGAR database are correct. An incorrect address in the EDGAR Accounting Contact Name and Address information may result in your fee Account Activity Statement being returned to the SEC as undeliverable. Please correct outdated addresses via the EDGAR filing website. The EDGAR system is available to receive and process filings from 6:00 a.m. to 10:00 p.m. Eastern Time on business days. Filer Support staff members are available to respond to requests for assistance from 7:00 a.m. to 7:00 p.m. Eastern Time. 61

62 Example of an SEC Suspension Notice The subject line will read: SUSPENDED FORM TYPE XXXXXXXXXX ( Accession number) THE FOLLOWING SUBMISSION HAS BEEN SUSPENDED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION. COMPANY: XXXXXXXXXX FORM TYPE: XXXXXXXXXX NUMBER OF DOCUMENTS: 1 RECEIVED DATE: 19-Jun :34 SUSPENSE DATE: 19-Jun :35 TEST FILING: YES CONFIRMING COPY: NO ACCESSION NUMBER: FILE NUMBER(S): 1. None. THE PASSWORD FOR LOGIN CIK WILL EXPIRE 10-Jul :59. THIS SUBMISSION SHOULD BE RE-TRANSMITTED IN ITS ENTIRETY AFTER MAKING THE RECOMMENDED CORRECTIONS. THE SUSPENDED SUBMISSION COULD CONTAIN ADDITIONAL ERRORS. ERR: XML_SCHEMA_VIOLATION MSG: File contains an XML Schema Violation: cvc-maxlength-valid: Value ' ' with length = '11' is not facet-valid with respect to maxlength '10'. LOC: LINE NUMBER: -1 ERR: TAG_VALUE_MISSING_OR_INVALID MSG: Value for <issuer.issuercik> is missing or invalid LOC: LINE NUMBER: 0 ERR: XML_SCHEMA_VIOLATION MSG: File contains an XML Schema Violation: cvc-type.3.1.3: The value ' ' of element 'issuercik' is not valid. LOC: LINE NUMBER: NOTICE URGENT: Verify that all of your addresses on the EDGAR database are correct. An incorrect address in the EDGAR Accounting Contact Name and Address information may result in your fee Account Activity Statement being returned to the SEC as undeliverable. Please correct outdated addresses via the EDGAR filing website. The EDGAR system is available to receive and process filings from 6:00 a.m. to 10:00 p.m. Eastern Time on business days. Filer Support staff members are available to respond to requests for assistance from 7:00 a.m. to 7:00 p.m. Eastern Time. We strongly encourage you to visit the Filing Website at You can download our current version of the EDGARLink/Windows software and templates, the Filer Manual, receive on-line help, and access Frequently Asked Questions. 62

63 Examples of SEC Suspension Error Messages SEC Error Message ERR: INCONSISTENT_TAG_VALUE MSG: Coregistrant CCC of XXXXXXXX value is inconsistent with CIK value of LOC: LINE NUMBER: 0 Translation Your Insider CIK and CCC do not match. Possible reasons include a simple typo or that the CCC has been changed. Update the CCC by entering the corrected value in the person s profile, found in the My Account area. When you come back to the Header tab of the form you are working on, click the Update All button which will appear next to the dropdown box for the Reporting Person/Insider. SEC Error Message ERR: REQUIRED_TAG_MISSING MSG: Required <nonderivativeholding.natureofownership> (Security #2 in the <nonderivativetable> group) tag is missing. LOC: LINE NUMBER: 0 Translation If you have indicated Indirect Ownership of the stock, a textual explanation in the last box of the row is needed. If you have put the information in a footnote, the SEC requires some text in that box. You can use the phrase, See Footnote to meet the system requirement. SEC Error Message ERR: XML_SCHEMA_VIOLATION MSG: File contains an XML Schema Violation: cvc-datatype-valid.1.2.1: is not a valid decimal value. LOC: LINE NUMBER 63 Translation: Usually this means that a required table tag value has been left blank. The most likely candidate is that a running total for the amount of stocks owned after each transaction has not been filled in. If you have more than one row of data, the total owned after each transaction must be recorded. SEC Error Message ERR: XML_SCHEMA_VIOLATION MSG: File contains an XML Schema Violation: cvc-type.3.1.3: The value of of element signaturename is not valid. LOC: LINE NUMBER 231 ERR: REQUIRED_TAG_MISSING MSG: Required <ownersignature.signaturename> (1 of 1) tag is missing. LOC: LINE NUMBER: 0 Translation: This message indicates that no signature has been typed in for the Insider of this filing. There are two ways to correct it: A signature can be typed in the Signature tab of the form that is currently being worked on, or a signature can also be added in the person s profile found in the My Account area. Once that has been done, go back to the Header tab of the form you are working on, and click the Update All button which will appear next to the dropdown box for the Reporting Person/Insider. 63

64 Transaction Codes The SEC designates specific letters of the alphabet that are used as codes to indicate the type of security and transaction. General Transaction Codes P - Open market or private purchase of non-derivative or derivative security S - Open market or private sale of non-derivative or derivative security V - Transaction voluntarily reported earlier than required Rule 16b-3 Transaction Codes A - Grant, award or other acquisition pursuant to Rule 16b-3(d) D - Disposition to the issuer of issuer equity securities pursuant to Rule 16b-3(e) F - Payment of exercise price or tax liability by delivering or withholding securities incident to the receipt, exercise or vesting of a security issued in accordance with Rule 16b-3 I - Discretionary transaction in accordance with Rule 16b-3(f) resulting in acquisition or disposition of issuer securities M - Exercise or conversion of derivative security exempted pursuant to Rule 16b-3 Derivative Securities Codes (except for transactions exempted pursuant to Rule 16b-3) C - Conversion of derivative security E - Expiration of short derivative position H - Expiration (or cancellation) of long derivative position with value received O - Exercise of out-of-the-money derivative security X - Exercise of in-the-money or at-the-money derivative security Other Section 16(b) Exempt Transaction and Small Acquisition Codes (except for Rule 16b-3 codes above) G - Bona fide gift L - Small acquisition under Rule 16a-6 W - Acquisition or disposition by will or the laws of descent and distribution Z - Deposit into or withdrawal from voting trust Other Transaction Codes J - Other acquisition or disposition (describe transaction) K Transaction in equity swap or instrument with similar characters U - Disposition pursuant to a tender of shares in a change of control transaction These can be accessed from within the filing, in Table I or Table II, by clicking on the Transaction Type link. 64