The Securities & Exchange Commission has proposed a rule under which equity compensation information will have to be published in company annual 10-K or 10-KSB reports.

If the rule is approved, the following will be required to be included in the annual reports:

• the number of securities authorized for issuance under each equity compensation plan of the registrant in effect as of the end of the most recently completed fiscal year;
• the number of securities issued pursuant to equity awards made during the last completed fiscal year, plus the number of securities to be issued upon the exercise of options, warrants or rights granted during the last completed fiscal year, under each plan;
• the number of securities to be issued upon the exercise of outstanding options, warrants or rights under each plan; and
• other than securities to be issued upon the exercise of outstanding options, warrants or rights, the number of securities remaining available for future issuance under each plan.

The proposed rule addresses concerns of the SEC regarding the absence of full disclosure to security holders about equity compensation plans, the potential dilutive effect of equity compensation plans, and the adoption of such plans without the consent of security holders.

Public comment is welcome regarding the proposed ruling. You should submit three copies of your comments to Jonathan G. Katz, Secretary, U.S. Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549-0609. You also may submit your comments electronically to the following electronic mail address: rule-comments@sec.gov.

All comment letters should refer to File Number S7-04-01; please include this file number in the subject line if you use electronic mail. Comment letters will be available for public inspection and copying in the Commission's Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549. The SEC will post electronically submitted comment letters on its Internet web site, www.sec.gov.

FOR FURTHER INFORMATION CONTACT: Raymond A. Be, Office of Rulemaking, Division of Corporation Finance, at (202) 942-2886.