The Securities and Exchange Commission (SEC) has provided relief for issuers affected by COVID-19.
Under a recent SEC order, companies that are required to file reports with the SEC under the Securities Exchange Act of 1934 (Exchange Act) during the period from March 1 to April 30, 2020, but are unable to meet the filing deadline due to circumstances related to COVID-19, will have an extra 45 days from the original filing date to make the filing if they satisfy certain conditions.
The staff of the SEC has also provided guidance giving companies a means to notify shareholders of changes in the date, time, or location of an annual meeting without having to amend their proxy statements or mail additional soliciting materials. That guidance also addressed virtual shareholder meetings.
Conditional Extension of Filing Deadlines
Under a recent SEC order, companies that are required to file reports with the SEC under the Exchange Act during the period from March 1 to April 30, 2020, but are unable to meet the filing deadline due to circumstances related to COVID-19 will have an extra 45 days from the original filing date to make the filing if they satisfy certain conditions.
The conditions are:
- The registrant is unable to meet a filing deadline due to circumstances related to COVID-19.
- The registrant furnishes a Form 8-K (or a Form 6-K, if eligible) to the SEC by the later of (a) March 16, 2020 or (b) the original filing deadline of the report stating:
- That the registrant is relying on the SEC’s order.
- The reasons why the registrant could not make the filing on a timely basis.
- The estimated date by which the filing is expected to be made.
- If appropriate, a risk factor explaining the impact of COVID-19 on the registrant’s business (if the impact is material).
- If the reason the filing cannot be timely made is because of the inability of any person to furnish a required opinion, report, or certification, the Form 8-K or Form 6-K must attach as an exhibit a statement signed by such person stating the specific reasons why such person is unable to furnish the required information on or before the original due date.
- The registrant files with the SEC the report, schedule or form required to be filed no later than 45 days after the original due date and discloses in the report, schedule, or form that it is relying on the SEC order and the reasons why it could not file it by the original due date.
A company meeting these conditions will not need to file a Form 12b-25. If a company meeting all of the other conditions is unable make the filing within the extended 45-day period, it will be able to rely on Rule 12b-25.
A person required to make a filing under the Exchange Act with respect to a registrant during the period from March 1 through April 30, 2020 affected by COVID-19 may also get a 45-day extension to make a filing (other than a Schedule 13D or an amendment to Schedule 13D), if it satisfies the following conditions:
- It is unable to meet a filing deadline due to circumstances related to COVID-19.
- It files the required report, schedule or form no later than 45 days after the original due date and discloses in the report, schedule, or form that it is relying on the SEC order and the reasons why it could not file it by the original due date.
The SEC’s order also provided limited relief from the obligation to furnish proxy statements, annual reports and other soliciting materials to a security holder under Exchange Act Sections 14(a) and (c) and Regulations 14A and 14C and Exchange Act Rule 14-f-1 if the conditions below are satisfied:
- The security holder has a mailing address in an area where, as a result of COVID-19, the common carrier has suspended delivery services of the type or class customarily used by the registrant or other person making solicitation.
- The registrant makes a good faith effort to furnish the soliciting materials and/or the information materials to the security holder, as required by the rules.
Annual Meeting Guidance
The staff of the SEC’s Division of Corporation Finance has issued guidance indicating that an issuer that has already mailed and filed its definitive proxy materials can notify shareholders of a change in the date, time, or location of its annual meeting without mailing additional soliciting materials or amending its proxy materials if it:
- Issues a press release announcing the change.
- Files the announcement as definitive additional soliciting material on EDGAR.
- Takes all reasonable steps necessary to inform other intermediaries in the proxy process (such as any proxy service provider) and other relevant market participants (such as the appropriate national securities exchanges) of the change.
The staff indicated that these actions should be taken promptly after making a decision to change the date, time, or location of the meeting and sufficiently in advance of the meeting so the market is alerted to the change in a timely manner. The staff also suggested that issuers which have not yet mailed and filed their definitive proxy materials should consider including disclosures regarding the possibility that the date, time, or location of the annual meeting will change due to COVID-19.
If an issuer plans to conduct a virtual or hybrid shareholder meeting, the staff indicated that it expects the issuer to notify its shareholders, intermediaries in the proxy process, and other market participants of those plans in a timely manner and disclose clear directions as to the logistical details of the meeting, including how shareholders can remotely access, participate in, and vote at the meeting. For issuers that have not yet filed and delivered their definitive proxy materials, those disclosures should be in the definitive proxy statement and other soliciting materials. Issuers that have already filed and mailed their definitive proxy materials would not need to mail additional soliciting materials (including new proxy cards) solely for the purpose of switching to a virtual or hybrid meeting if they follow the steps described above for announcing a change in the meeting date, time, or location.