Item 1.01, 1.02, 2.06

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  • Publicado : 17 de noviembre de 2011
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Item 1.01(a) requires disclosures when a company enters into a material definitive agreement not made in the ordinary course of business.

A “material definitive agreement” is defined as anagreement that provides for obligations that are material to and enforceable against the company, or rights that are material to the company and enforceable by it against one or more other parties, whetheror not subject to conditions (Item 1.01(b)). Any material definitive agreement not made in the ordinary course of the company’s business must be disclosed. Because it is obvious that the SettlementAgreement is “not made in the ordinary course of business,” the issue here is whether the Settlement Agreement constitutes a “material definitive agreement.”

Although there is no bright line testof “materiality” adapted by SEC or existing case law, the Supreme Court has indicated that information is material if:
• there is a substantial likelihood that a reasonable stockholder would considerit important in making an investment decision about the company; or
• the information would have been viewed by the reasonable investor as having significantly altered the total mix of informationthat is available about the company.

Under Item 1.01, the Company is required to disclose:
• the date of the agreement;
• the parties to the agreement;
• a brief description of the material termsand conditions of the agreement; and
• a brief description of any material relationship between the company or its affiliates and any of the parties.

Item 1.02(a) generally requires disclosure ofterminations of material definitive
agreements, if material to the company. The interpretation of materiality threshold is same as that discussed in Item 1.01.

if the cancellations arematerial, the Company is required to disclose:
• the date of termination;
• the parties to the agreement;
• a brief description of the material terms and conditions of the agreement;
• a brief...
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