TheCorporateCounsel.net

Yesterday, the SEC announced that Corp Fin has issued guidance that enhances the accommodations available to companies for nonpublic review of draft registration statements. The SEC’s announcement notes:

The enhanced accommodations will expand the types of forms eligible to be submitted as draft registration statements for nonpublic review and permit reporting companies to submit draft registration statements for nonpublic review regardless of how much time has passed since their initial public offering. In addition, companies will have added flexibility to start the review process earlier by omitting certain underwriter disclosures from their initial submissions.

More specifically, the updated Corp Fin guidance notes the following changes to the existing framework for the Staff’s review of nonpublic draft registration statements:

The Division is expanding the accommodations available for issuers that submit draft registration statements for nonpublic review. We first expanded the voluntary draft registration statement submission accommodations beyond Emerging Growth Companies to include all issuers in 2017. Based on our experience, we believe that further expansion of these accommodations can facilitate capital formation, without diminishing investor protection.

The enhanced accommodations include:

– Expanding the availability of the nonpublic review process for the initial registration of a class of securities under the Exchange Act to include both Section 12(b) and Section 12(g) registration statements on Forms 10, 20-F, or 40-F.

– Permitting issuers to submit draft registration statements regardless of how much time has passed since they became subject to the reporting requirements of Section 13(a) or 15(d) of the Exchange Act.

– Expanding the availability of the nonpublic review process for a de-SPAC transaction in situations where the SPAC is the surviving entity (i.e., SPAC-on-top structure) as long as the target is eligible to submit a draft registration statement.

– Permitting issuers to omit the name of the underwriter(s) from their initial draft registration statement submissions, when otherwise required by Items 501 and 508 of Regulation S-K, provided that they include the name of the underwriter(s) in subsequent submissions and public filings.

The review of draft registration statements has proven to be a useful process for companies seeking to go public or conduct their first follow-on offerings, so these enhancements to the Staff policy are welcome. The guidance notes that companies may submit questions about their eligibility to use the expanded processing procedures to CFDraftPolicy@sec.gov.

– Dave Lynn