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Coronavirus (COVID-19): SEC issues dilatory relief for issuers

Mar 6, 2020

On March 4, the Securities and Exchange Commission (SEC) issued an order providing conditional regulatory relief for certain publicly traded company filing obligations under the federal securities laws, as a result of the challenges created by the spread of the coronavirus (COVID-19) for certain companies that are required to provide information to trading markets, shareholders and the SEC.

Among other conditions, companies must convey through a Current Report on Form 8-K (or Form 6-K in the case of foreign issuers) a summary of why the relief is needed in their particular circumstances. In connection with the relief the SEC might grant under its order, it will take the following positions with respect to certain obligations under the Securities Act of 1933, amended, and the Securities Exchange Act of 1934, as amended (Exchange Act):

• For purposes of eligibility to use a Registration Statement on Form S-3 (and for well-known seasoned issuer status, which is based in part on Form S-3 eligibility), a company relying on the exemptive order will be considered current and timely in its Exchange Act filing requirements if it was current and timely as of the first day of the relief period and it files any report due during the relief period within 45 days of the filing deadline for the report.

• For purposes of the Form S-8 eligibility requirements and the current public information eligibility requirements of Rule 144(c), a company relying on the exemptive order will be considered current in its Exchange Act filing requirements if it was current as of the first day of the relief period and it files any report due during the relief period within 45 days of the filing deadline for the report.

• Companies that receive an extension on filing Exchange Act annual reports or quarterly reports pursuant to the order will be considered to have a due date 45 days after the filing deadline for the report. As such, those companies will be permitted to rely on Rule 12b-25 if they are unable to file the required reports on or before the extended due date.

The SEC’s order also reminds all companies (and other related persons) to consider their activities in light of their disclosure obligations under the federal securities laws with regard to the coronavirus, and that the SEC is open to additional or different assistance with regard to the coronavirus beyond what was issued in its order, which will be addressed on a case-by-case basis in light of the specific facts of the applicable situation.