sarbanes-Oxley Act

[Guest lindamichals]

I have a situation where a plan will initiate a blackout period on January 22nd and it will end on January 27th, a day after the new Sarbanes-Oxley Act takes place. Any comments whether the plan sponsor should push back the blackout to accomodate the new rules or continue with the date the investment company set. They are flexible(investment co.) No guidance from them, they will do what we tell them.

[E as in ERISA]

Are you asking whether they should send out a blackout notice and then push the blackout start date back to 30 days after the notice is mailed? SOx only requires that notices be sent out "as soon as possible" for blackouts between January 26 and February 25. If you're going to start the blackout between those dates, then the contents of the notice will have to meet the SOx requirements. However, unless you're going to push it past February 25, then SOx' strict 30-day requirement doesn't apply. Regardless of when you start it, the prudence requirements of ERISA still apply and you need to consider what is the appropriate content and timing of any notices based on those rules.

[Guest lindamichals]

My question is: will the plan be out of compliance if they do not send out the notice within the 30 day restriction. They intend to send on Jan 7th, the blackout starts on Jan 22nd.

[E as in ERISA]

They will not be out of compliance with the blackout rules -- the 30 day rule doesn't start until blackouts starting about February 25 or 26. (However, that doesn't mean that the prudence standard is met -- it might be prudent to send it out more than 15 days in advance).

[Guest Chuck Miller]

While you may not have to fully comply with Sarbanes-Oxley, I would consider moving your blackout date back to Feb 7 to allow 30 days notice. This is not so much for compliance reasons as for doing a thorough job of communications with participants. I'd also send another notice a week before the blackout to remind participants of what's going to happen.

Another idea, communicate with managers by memo or email as the notices are being sent to make sure they understand the blackout is coming and so they can explian it their employees.

[Guest carsca]

Assuming your company's plan holds employer stock, have you considered whether the insider trading prohibitions apply to your company's executives on January 26-27, 2003?