SEC Issues Form S-3 Registration and Annual Report C&DIs

On November 2, 2016, the Securities and Exchange Commission (“SEC”) Division of Corporation Finance released two new compliance and disclosure interpretations (“C&DIs”) addressing eligibility to use Form S-3 registration statements and submission of annual reports to the SEC.

Form S-3 Eligibility

New Question 116.25 of the Securities Act Forms C&DIs clarifies that securities registered for resale on Form S-3 registration statements in reliance on Form S-3 Instruction I.B.3 should be counted against the issuer’s available capacity under Instruction I.B.6 of the form.

Instruction I.B.6 allows an issuer with less than a $75 million public float to use a Form S-3 registration statement for a primary offering such as an Initial Public Offering (“IPO) so long as the issuer sells no more than one-third of its public float within a 12-month period.

The new C&DI provides an example of an issuer that sells securities to the same investors:

• with a portion coming from a takedown from its shelf registration statement that the issuer relies on Instruction I.B.6; and
• a portion coming from a separate private placement that the issuer concurrently registers for resale on a separate Form S-3 in reliance on Instruction I.B.3.

The new C&DI clarifies that the issuer may not rely on Instruction I.B.3 to register the resale of the balance of the securities on Form S-3 unless it has the ability under Instruction I.B.6 to issue that amount of securities at the time of filing the resale registration statement.

If it does not have the ability to issue that amount, the issuer must either:

• register the resale on a Form S-1 registration statement; or
• wait until it has the ability under Instruction I.B.6 to register the resale on Form S-3.

To learn more about Form S-3, see this blog post on Form S-3 Registration Statements.

Annual Reports to the SEC. 

The SEC’s second new C&DI addresses:

• the requirement in Rule 14a-3(c) and Rule 14c-3(b) under the Securities Exchange Act that registrants mail seven copies of the annual report sent to security holders to the SEC “solely for its information”; and
• the requirement of Form 10-K that certain Section 15(d) registrants furnish four copies of any annual report to security holders to the SEC.

The C&DI states that the SEC will not object if an issuer posts an electronic version of its annual report to its corporate website by the dates required by Rule 14a-3(c), Rule 14c-3(b), and Form 10-K, respectively, instead of mailing paper copies or submitting the annual report on the SEC’s EDGAR database, so long as the report remains accessible for at least one year after posting, the Division’s staff will consider the report available for its information.

To learn more about annual report requirements, see this blog post about Annual Reports to Stockholders.

For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956 or by email at [email protected].   This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855
www.SecuritiesLawyer101.com