Today the Governor of the State of Delaware issued an executive order (the “Order")[1] that provides two limited forms of relief for publicly traded companies[2] hosting shareholder meetings during the coronavirus (COVID-19) pandemic.
SEC Extends Conditional Exemptions From Reporting and Proxy Delivery Requirements for Public Companies Affected By COVID-19 For Reports due on or before July 1, 2020 4/1/2020
On March 25, 2020, the Securities and Exchange Commission (the “Commission") announced (available here) that it is providing a 45-day extension for companies to file certain disclosure reports that would otherwise have been due on or before July 1, 2020 (Order available here). This is an extension of the conditional reporting relief covered by the Commission’s relief (Original Order available here) for certain public company filing obligations under the federal securities laws, issued on March 4, 2020 (as previously discussed in our post here, and updated here), to companies impacted by the novel coronavirus disease 2019 (“COVID-19"). In addition, the Commission’s Division of Corporation Finance (the “Division") issued on March 25, 2020 its current views regarding disclosure considerations and other securities law matters related to COVID-19 (available here).
SEC Amends Accelerated and Large Accelerated Filer Definitions to Reduce Burdens on Smaller Reporting Companies – Effective April 27, 2020
On March 12, 2020, the Securities and Exchange Commission announced (available here) the adoption of a final rule (available here) amending the “accelerated filer” and “large accelerated filer” definitions. The amendments will be effective April 27, 2020 and first impact annual reports on Form 10-K due after the effective date.
Reconsidering Poison Pills
The public health crisis caused by COVID-19 has had a dramatic economic impact on the trading prices of U.S. companies across all industries. As boards of directors and management teams work to stabilize their operations and deal with the myriad issues caused by the pandemic, we have witnessed a number of opportunistic shareholder activists accumulating stakes in publicly traded targets. In the current environment, boards and their advisors should take, and several already have taken, a fresh look at the implementation of a shareholder rights plan (aka “poison pill").
Coronavirus Disease 2019 Update: Impact under Nasdaq Rules of SEC Relief to Affected Companies
On March 8, 2020, we discussed on a post (available here) about the announcement (available here) by the Securities and Exchange Commission (the “Commission”) that providedconditional regulatory relief (Order available here) for certain filing obligations under the federal securities laws to companies impacted by the coronavirus disease 2019 (“COVID-19”).
SEC Provides Conditional Regulatory Relief and Additional Disclosure Guidance for Companies Affected by the Coronavirus Disease 2019 (COVID-19)
On March 4, 2020, the Securities and Exchange Commission (the “Commission”) announced (available here) that it is providing conditional regulatory relief (Order available here) for certain filing obligations under the federal securities laws to companies impacted by the coronavirus disease 2019 (“COVID-19”), including “U.S. companies located in the affected areas, as well as companies with operations in those regions.
SEC Amends Rules to Encourage Issuers to Conduct Registered Debt Offerings
On March 2, 2020, the Securities and Exchange Commission (the “Commission”) announced (available here) the adoption of amendments to the financial disclosure requirements applicable to registered debt offerings that include credit enhancements, such as subsidiary guarantees, in an effort to “improve the quality of disclosure and increase the likelihood that issuers will conduct debt offerings on a registered basis."
Direct Listing Update: Revised Proposal for Primary Offerings
On December 3, 2019, Gibson Dunn published A Current Guide to Direct Listings discussing, among other things, a proposal submitted to the U.S. Securities and Exchange Commission (SEC) by the New York Stock Exchange (NYSE)that would permit a privately-held company to conduct a direct listing in connection with a primary offering. On December 11, 2019, the NYSE withdrew its proposal (as reported in An Interim Update on Direct Listing Rules) and was expected to submit a revised proposal consistent with past proposals related to direct listings. On December 11, 2019, the NYSE submittedthe revised proposal.
SEC Announces Proposed Amendments to MD&A and Guidance on Key Performance Indicators and Metrics; Commissioners Debate Addition of Sustainability Disclosure Requirements
On January 30, 2020, the Securities and Exchange Commission (the SEC) issued proposed amendments to simplify the requirements of Regulation S-K and an interpretative release relating to Management’s Discussion and Analysis (“MD&A”).
Considerations for Preparing Your 2019 10-K
In a client alert published today (available here), we offer our observations on new developments and recommended practices to consider in preparing the Annual Report on Form 10-K. In particular, given the U.S. Securities and Exchange Commission’s latest enforcement actions and recent adoption of amendments impacting disclosures in Form 10-K, there are a number of important substantive and technical considerations that registrants should keep in mind when preparing their 2019 Forms 10-K.