[January 27, 2023]. Question: At a time when she is not aware of material nonpublic information, a person obtains a bank loan to invest in real estate, and pledges securities as collateral. Question: When does Rule 12g-4 suspend an issuers Section 13(a) and Section 14(a) reporting obligations? Does canceling one or more plan transactions affect the availability of the Rule 10b5-1(c) defense for prior plan transactions? Question: Section 15(d) of the Exchange Act provides an automatic suspension of the periodic reporting obligation as to any fiscal year (except for the fiscal year in which the registration statement became effective) if an issuer has fewer than 300 security holders of record at the beginning of such fiscal year. Does adoption of the Rule 10b5-1 plan change the due date for the Form 144? Question: When a registrant is amending multiple Exchange Act reports at the same time, may it do so in a single filing? The exercise of the option is a separate investment decision from the purchase of the option. After filing the Form 25, the issuer files a Form 12b-25 with respect to a periodic report that is due between the date it filed the Form 25 and the effective date for the delisting under Rule 12d2-2(d)(1). Unless this condition is met, the 45 day relief period provided in COVID-19 Order will not be available. Question: Must co-principal executive officers (or co-principal financial officers) execute separate certifications or may both execute the same certification? Title V of the Act is classified principally to chapter 94 (6801 et seq.) As such, the registrant would be permitted to subsequently rely on Rule 12b-25 if it is unable to file the report on or before the extended due date. 2 Securities Exchange Act Release No. Also, she may have had the discretion to substitute collateral or provide additional collateral or cash to prevent foreclosure and sale of the stock. Rule 12d2-2(d)(5) specifies that the issuers duty to file any reports under Section 13(a) solely because of registration pursuant to Section 12(b) will be suspended upon the effective date of the delisting. 25, 2009]. Question: Is it necessary for a majority of the board of directors of the registrant to sign an amendment to a Form 10-K? 240.12b-5 Determination of affiliates of banks. Rule 12b-2 requires that an accelerated filer or large accelerated filer be subject to the reporting requirements of Section 13(a) or 15(d) of the Exchange Act. Answer: No. If a report is due on a Saturday, Sunday or holiday, the issuer can timely file a Form 12b-25 on the second business day following the due date and timely file the report fifteen calendar days (annual report) or five calendar days (quarterly report) after the first business day following the due date. Question: Can a registrant that filed a Form 12b-25 subsequently rely on the COVID-19 Order (Release No. Rule 10b5-1(c)(1)(i)(B)(1) would not be available. For a defense to be available under Rule 10b5-1(c), each of the amount, price and date of the transaction must be specified or determined by formula, or all subsequent discretion over purchases and sales must be delegated to a third party who must not be aware of material nonpublic information when exercising that discretion. 25, 2009]. 240.12b-3 Title of securities. A defense would be available under Rule 10b5-1(c)(1)(i)(A)(2) and (B)(1) if: (1) she acts in good faith and is not aware of material nonpublic information at the time she instructs the broker; and (2) in placing a non-discretionary limit order, she specifies the dates on which that limit order will be in force. [September 30, 2008], 253.02 Rule 12h-3(c)-(d) operates to relieve a holding company of the Section 15(d) reporting obligation which would normally arise from the registration statement filed for the reorganization of a non-reporting company into a one-subsidiary holding company where the equity holders receive the same proportional interests in the holding company and the holding company emerges from the reorganization with more than 300 shareholders. Although Rule 12g-3 technically does not apply because only one issuer is involved, the Division is of the view that the new common stock would succeed to the registered status of the old common stock, so that continuous Exchange Act reporting would be required. Thus, the company would be eligible to use Form S-3 only after it subsequently filed its Exchange Act reports on a timely basis for 12 calendar months after the original Form 10-K due date. Washington, D.C. 20549 . The periodic report will not be deemed timely for purposes of form eligibility, and the issuer will not be deemed current until the amended periodic report containing the certification is filed. Question: Which persons will be considered named executive officers for purposes of determining the parties for whom individualized disclosure pursuant to Item B. 240.0-12 Commission procedures for filing applications for orders for exemptive relief under Section 36 of the Exchange Act. The issuer is not otherwise required to file Exchange Act reports under Section 13(a) or 15(d) of the Exchange Act after the effective date of the delisting. The Securities and Exchange Commission (the "SEC") recently approved final rules introducing new amendments and disclosure requirements under Rule 10b5-1 of the . The market order does not effect an alteration or deviation of a plan transaction within the meaning of Rule 10b5-1(c)(1)(i)(C) because the 10,000 share limit order under the plan will continue to be executed when the price limit is met. 25, 2009]. Otherwise, a right to dividends alone shall not represent a pecuniary interest in the securities; ( E) A person's interest in securities held by a trust, as specified in 240.16a-8 (b); and. Question: If the Rule 12b-25 extension period ends on a Saturday, Sunday or federal holiday, may the periodic report be filed on the next business day and still be deemed to have been timely filed? Or, if there is ultimately an individual serving as the general partner of a limited partner in the chain of ownership, then that individual is likely performing the equivalent functions of an audit committee for the registrant. Because this would give the issuer the potential to effectively modify the plan by doing the block trades while aware of material nonpublic information, the Division staff took the view that the Rule 10b5-1(c) affirmative defense would not be available. [Mar. That the principal executive and financial officers do not need to consider such controls in making their individual certifications about their responsibility for establishing and maintaining the filer's disclosure controls and procedures does not mean that the filer can exclude such controls in complying with Rules 13a-15 and 15d-15 and Item 307 of Regulation S-K. [May 29, 2009]. The issuer may look to whether more than 50 percent of the voting power of those classes on a combined basis is directly or indirectly owned of record by residents of the United States. [September 30, 2008]. The issuer is not permitted to file a special financial statement report containing such audited financial statements pursuant to Rule 15d-2 (as opposed to an annual report in accordance with Rule 13a-1). 25, 2009]. Answer: Yes. The same analysis applies whether the option is a put or a call. Answer: This is a question of fact. [September 30, 2008]. [June 4, 2010]. [Mar. Question: On January 1, a person adopts a written plan for selling securities that satisfies the affirmative defense conditions of Rule 10b5-1(c). Should the registrant instead furnish a report on Form 8-K or 6-K, as applicable, relying on the COVID-19 Order (Release No. [September 30, 2008], 250.02 The successor to a Section 12(g) registrant that underwent a re-incorporation merger to change its state of incorporation reported the merger in the next Form 10-Q that would have been required of the Section 12(g) registrant, and thereafter continued to file Exchange Act reports in reliance upon Rule 12g-3. Question: If Company A files proxy materials for the transfer of substantially all of its assets to its wholly-owned subsidiary, Company B, in exchange for shares of Company B stock, will Company A have to pay the filing fee contemplated by Rule 0-11 or Exchange Act Section 14(g)? The public offering price is $5 a share. Question: Are there any additional extensions for the timely filing of periodic reports beyond those provided in Rule 12b-25? But they weren't the only ones demanding action under the Gold Dome. Question: In determining whether more than 50 percent of the assets of an issuer are located outside the United States under the definition of foreign private issuer in Securities Act Rule 405 and Exchange Act Rule 3b-4(c), can an issuer use the geographic segment information determined in the preparation of its financial statements? ( F) A person's right to acquire equity securities through the exercise or conversion of any derivative security, whether or not presently exercisable. [September 30, 2008]. [September 30, 2008]. view historical versions Title 17 Chapter II Part 240 View Full Text Previous Next Top Such individualized disclosure is required about executive officers for whom the issuer otherwise provides individualized compensation disclosure in the filing. Similarly, a company that must file a registration statement on Form 10 to register a class of securities under Section 12(g) must include financial statements for its previous fiscal year. The person must make this specification or delegation in good faith before becoming aware of material nonpublic information. As a general matter, a fund-switching transaction that effects a sale could be a corresponding or hedging transaction under Rule 10b5-1(c)(1)(i)(C) with respect to a payroll deduction purchase under the 401(k) plan. Rule 12d2-2(d)(5) specifies that the issuers duty to file any reports under Section 13(a) solely because of registration pursuant to Section 12(b) is suspended only when the Form 25 is effective for the delisting. How is this analyzed for purposes of Rule 10b5-1(c)? Answer: The determination must be made separately for each group. [September 30, 2008]. [September 30, 2008]. Members of the public flooded the State Capitol again on Tuesday. A company must always file the Form 10-K for the fiscal year in which the registration statement is declared effective. Question: Can a filer rely on Exchange Act Rule 12b-25 to extend the due date of an Interactive Data File? [Mar. Answer: Yes. Definitions: Rules 3a11-1 to 3b-19 Question 110.01 Question: A foreign issuer qualifies as a foreign private issuer on the last business day of its most recently completed second fiscal quarter, which is the "determination date" for foreign private issuer status under Exchange Act Rule 3b-4 (c). Other than the referenced section, the process and registration statements used are the same as for a Section 12 (g) registration. The issuer must assess on a consolidated basis the location from which its officers, partners, or managers primarily direct, control and coordinate the issuer's activities. Concurrently, the issuer registers under the Exchange Act using a Form 8-A that also does not contain the final year end audited financial statements. If the amendment does not contain or amend disclosure pursuant to Item 307 or 308 of Regulation S-K (or the equivalent disclosure requirement in Form 20-F or 40-F), and such disclosure is not otherwise required to be amended given the nature of the reasons for the amendment, paragraphs 4 and 5 may be omitted from the certifications that are filed with the amendment. Exchange Act Rule 17a-4 Amendments Chart of Significant Changes Rule 17a-4(f) Current Rule Amended Rule Definitions Firms may use "electronic storage media" to maintain and preserve required records. For example, where the due date for a Form 10-K is Sunday, March 31, the Form 10-K would be due on Monday, April 1 and the Form 12b-25 would be timely if filed on Tuesday, April 2. U.S. Securities and Exchange Commission (SEC) rules require reporting companies to file material agreements as exhibits to periodic reports, registration statements and certain other disclosure documents. Therefore, an issuer may not look to Rule 12b-25 to avoid filing a periodic report that becomes due after the filing of the Form 25 but before the effectiveness of the delisting. 25, 2009]. However, the adopting release also adopts amendments to Exchange Act Rules 13a-14 and 15d-14 that exclude interactive data from officer certifications, which, among other things, describe the officers' responsibility for establishing and maintaining disclosure controls and procedures and require statements regarding their design and evaluation. Some of these C&DIs were first published in prior Division publications and have been revised in some cases. Shareholders could interpret this example as asking them to vote on whether or not the company should hold an advisory vote on executive compensation, rather than asking shareholders to actually approve, on an advisory basis, the compensation paid to the companys named executive officers. [September 30, 2008], 230.02 If a newly formed public company uses Form S-3 on the basis of another entitys (e.g., its parents) reporting history and that other entity is an accelerated filer, then the newly formed public company is also deemed an accelerated filer. Question: Using the same facts in Question 161.08 above, if the amendment is not filed within the time period required for the periodic report, is the report deemed to be untimely? Registrants unable to rely on the COVID-19 Order are encouraged to contact the staff to discuss collateral consequences of late filings. Therefore, unless a registrant that filed a Form 12b-25 also furnished a Form 8-K or Form 6-K by March 16, 2020 or the original due date of the report, it would not be able to rely on the COVID-19 Order. Question: If the same individual is both the principal executive officer and principal financial officer, must he or she sign two certifications? [September 30, 2008]. Answer: Item B. Question: Must an issuer that is filing or submitting reports exclusively under Section 15(d) of the Exchange Act on a voluntary basis (for example, pursuant to a covenant in an indenture or similar document), due to a statutory suspension of the Section 15(d) filing obligation, comply with Rules 15d-14 and 15d-15 and the disclosures required by Item 307 and Item 308 of Regulation S-K? Question: What fee rates apply to repurchases of securities and to proxy solicitations and statements in corporate control transactions? She fails to pay the loan as due. [Mar. Answer: No. If a filer does not file its proxy statement or amend its Form 10-K within 120 days, it would be considered an untimely filer. Where the person retains any discretion to substitute or provide additional collateral, or to repay the loan before the pledged securities may be sold, Rule 10b5-1(c)(1)(i)(B)(3) does not provide a defense. Answer: The analysis depends on the manner in which the adjustment is effected: (a) First, the written plan could provide for adjustment of the amount of securities to be sold each month based on a written formula specified in the plan within the meaning of Rule 10b5-1(c)(1)(i)(B)(2). 2, 1980). In such a case, the newly formed public company would not wait until the end of its fiscal year to determine its accelerated filer status. This is because the Form 10-K serves as the Section 10(a)(3) update to the Form S-3, as provided in the undertakings in Item 512 of Regulation S-K. Further, for purposes of Rule 401(b) under the Securities Act, the filing of the Form 10-K constitutes a post-effective amendment to the Form S-3. Question: A companys CEO is resigning at the end of the year and is no longer performing the functions of a principal executive officer even though she remains employed with the company and has the title of the CEO. Question: Section 15(d) of the Exchange Act provides an automatic suspension of the periodic reporting obligation as to any fiscal year (except for the fiscal year in which the registration statement became effective) if an issuer has fewer than 300 security holders of record at the beginning of such fiscal year. [September 30, 2008], 254.01 If an issuer of a guaranteed security has a different class of securities that is registered under Section 12 of the Exchange Act, the issuer cannot rely on Rule 12h-5 for reporting relief until it deregisters the other class of securities. Question: Does canceling one or more plan transactions affect the availability of the Rule 10b5-1(c) defense for future plan transactions? Answer: No. [September 30, 2008]. The rule serves to eliminate any possible gap in the application of Exchange Act protection to the security holders of the predecessor. Rather, the companys ability to continue to make such offers or sales will depend on whether it determines that the prospectus included in the Form S-3 is a valid Section 10(a) prospectus and there are no Section 12(a)(2) or anti-fraud concerns with the prospectus. Question: Can a company suspend its reporting obligations under Section 15(d) with respect to the fiscal year within which such registration statement became effective? [Apr. See Securities Act Release No. 24, 2009]. In the Citizens and Southern Corp. no-action letter (Feb. 8, 1988) issued by the Division, we state that, for a plan filing annual reports on Form 11-K, no other reports required by Section 13 of the 1934 Act would be required. [September 30, 2008], 220.01 After the written trading plan described in Q&A 120.11 has been in effect for several months, the broker that has been executing plan sales goes out of business at a time when the person is aware of material nonpublic information. The registrant can file a Form 15 relating to the B partnership indicating the suspension of reporting with respect to that partnership, and continue filing reports under the 33- number for the remaining partnership. Question: When must a parent companys full and unconditional guarantee be in effect in order for the parents subsidiary to be exempt from the requirements of Section 13(a) or 15(d) pursuant to Exchange Act Rule 12h-5? The person does not communicate any information to the broker that could influence when sales would occur. See, e.g., SEC v. Zandford, 535 U.S. 813 (2002) and Merrill Lynch, Pierce, Fenner & Smith, Inc., v. Dabit, 547 U.S. 71 (2006). Answer: No. [Mar. [September 30, 2008]. [September 30, 2008]. In such cases, a transition report would not be required. This is because the terms of the margin account contract would permit him to exercise subsequent influence over how, when, or whether to effect purchases or sales. The third party who has been granted discretion must not be aware of material nonpublic information when exercising that discretion. Question: In determining whether a majority of the executive officers or directors are United States citizens or residents under the definition of foreign private issuer in Securities Act Rule 405 and Exchange Act Rule 3b-4(c), must the calculation be made separately for each group or are executive officers and directors to be treated as a single group when making the assessment? C&DIs for Exchange Act Section 16 rules have been separately published and can be found at Exchange Act Section 16 and Related Rules and Forms. Question: At a time when he is not aware of material nonpublic information, a person obtains a $1 million loan from a brokerage firm and places $2 million of stock in a margin account with the broker. Under the bankruptcy plan, all shares of the old common stock are canceled simultaneously with the issuance of the new common stock to new holders. Assuming the registrant had more than 300 holders of record as of January 1, the registrant then has a Section 15(d) obligation that revives because it had an effective Form S-3 and Form S-8 that were updated during the registrants last fiscal year by virtue of the filing and incorporation by reference of a Form 10-K into the Form S-3 and Form S-8. [December 8, 2016]. Rule 10b5-1(c)(1)(i)(C) requires, as a condition to the exemption, that the purchase or sale be pursuant to the contract, instruction, or plan. [Mar. Is the sale pursuant to the option exercise covered by an affirmative defense under Rule 10b5-1(c)? The same analysis applies whether the option is a put or a call. Reliance on this affirmative defense does not prevent the person from setting some of the terms of the purchases or sales at the creation of the contract, instruction or plan so that no one has subsequent discretion as to those terms. Question: Under applicable state law, an oral agreement would be considered a binding contract. Once the Form 25 is effective the company may file a Form 15 which will immediately suspend its Exchange Act reporting obligations. The stock price falls and the broker issues a margin call. The Form 10-K would then be due for filing on Tuesday, April 16 (15 days after April 1, not 15 days after April 2). Rule 12b-25 has been amended to state that its provisions do not apply to Interactive Data Files. Two months later, he wishes to exercise the option. Question: On its proxy card and voting instruction form, how should a company describe the advisory vote to approve executive compensation that is required by Exchange Act Rule 14a-21? The companys next Form 10-Q is due on the same Sunday the Form 25 will become effective. A company that is registering on a national securities exchange accomplishes its registration under Section 12 (b) of the Exchange Act . 25, 2009]. Question: During a month when the written trading plan described in Question 120.11 is in effect, the person calls the broker to place an order to sell an additional 15,000 shares at the market. In establishing the trust, she specifies that the trust shall sell 1,000 shares of issuer stock each quarter. The date by which the periodic report must be filed pursuant to Rule 12b-25(b)(3) falls after the effective date of the delisting. (b) Alternatively, the written plan could provide for adjustment of the amount of securities to be sold each month based on a delegation of discretion to the broker. (b) The market order transaction would not affect the availability of the written trading plan defense for the limit order sales under the written trading plan. Institutional custodians, such as Cede & Co. and other commercial depositories, are not single holders of record for purposes of the Exchange Acts registration and periodic reporting provisions. (a) All papers required to be filed with the Commission pursuant to the Act or the rules and regulations thereunder shall be filed at the principal office in Washington, DC. Answer: No. The SEC amended Rule 17a-4 on October 12, 2022 to modify the requirements regarding the maintenance and preservation of electronic records, the use of third-party recordkeeping services to hold records, and the prompt production of records. Question: How does the analysis in Question 120.11 change if the written trading plan doesn't specify when the non-discretionary limit order will be in force? After the registrant files the Form 10-K, however, all offers and sales under the registration statement must cease. Securities Act Release No. Under Exchange Act Rule 3b-4(e), a foreign issuer generally may use the foreign private issuer forms and rules until the first day of the fiscal year following the determination date on which it no longer qualifies as a former private issuer. Answer: Yes. Answer: Yes, assuming two additional facts are present: (1) the terms of the plan do not permit her to exercise any subsequent influence over the timing of sales under the plan; and (2) the broker is not aware of material nonpublic information when selling securities under the plan. Therefore, the registrant would not satisfy General Instruction I.A.3 to Form S-3 at the time of its Section 10(a)(3) update because, while the company may be current in its Exchange Act reporting at that time, it would not be timely in that reporting for the twelve calendar months preceding the filing of the Section 10(a)(3) update. [September 30, 2008]. Answer: Rule 12g5-1 defines held of record for purposes of Exchange Act Section 12(g) and 15(d). In this case, where one or more of the price, amount and dates of transactions under a contract, instruction or written plan are to be determined based on a delegation of discretion to another person, the availability of a defense depends upon satisfaction of the conditions of Rule 10b5-1(c)(1)(i)(B)(3). [September 30, 2008]. The instruction to the broker, which is an instruction to another person within the meaning of Rule 10b5-1(c)(1)(i)(A)(2), specifies the date of the transaction and imposes a limit on the price, within the meaning of Rule 10b5-1(c)(1)(iii)(B). Subpart A - Rules and Regulations Under the Securities Exchange Act of 1934 ( 240.0-1 - 240.12a-11) General ( 240.12b-1 - 240.12b-7) 240.12b-1 Scope of regulation. If the company does not anticipate filing the periodic report within the extension period, it should not check the box in Part II of Form 12b-25. Question: Does Rule 12a-5 provide an exemption from registration for poison pill rights under stockholder rights plans? Answer: Rules 10b5-1(c)(1)(i)(A)(3) and (B)(1) could provide a defense if the limit order is non-discretionary. Answer: No. USA February 27 2023. [January 27, 2023]. [December 8, 2016]. In 240.0-1 to 240.24b-3, the numbers to the right of the decimal point correspond with the respective rule numbers of the rules and regulations under the Securities Exchange Act of 1934. The person intends to delegate investment control over trust assets to the trustee so as to establish a defense under Rule 10b5-1(c)(1)(i)(B)(3) for trust transactions. The bank proceeds against the stock that was posted as collateral and sells it in the open market. Answer: No. During any three-month period, sales of issuer securities by the trust will share the Rule 144(e) volume limitation with the person's sales of other issuer securities he owns. Question: At a time when she is not aware of material nonpublic information, a person establishes a written trading plan to sell 10,000 shares each month, at or above $20 per share. Question: May a company continue to use a registration statement that is predicated on timely filed reports (such as Form S-3) during the Rule 12b-25 extension period for a periodic report? Answer: The form already includes the representation, so modification is unnecessary. What effect does this have on the availability of a Rule 10b5-1(c) defense? 25, 2009]. For plans that take into account incentive-based compensation, an issuer would be expected to claw back the amount contributed to the notional account based on erroneously awarded incentive-based compensation and any earnings accrued to date on that notional amount. In such a case, each trust, estate or account is a distinct holder of record for purposes of Sections 12(g) and 15(d). The Commission publishes orders and related press releases concerning current fee rates on the Commission's web site at www.sec.gov. Answer: Because the certification relates to the entire Form 10-K or 10-Q, the amendment should include the entire report, not just the signature page. If during the term of the trust the person can control what portion of the Rule 144(e) volume limitation is available for trust sales, the person would be permitted to exercise subsequent influence over trust sales within the meaning of Rule 10b5-1(c)(1)(i)(B)(3). If the margin account contract did not permit the insider to exercise any subsequent influence over how, when, or whether to effect purchases or sales, and the broker did not in fact give the person the opportunity to substitute or provide additional collateral or cash, a defense would be available under Rule 10b5-1(c)(1)(i)(B)(3) if the broker is not aware of material nonpublic information in selling the margined securities. Absent other factors indicating the location from which an issuer's officers, partners, or managers primarily direct, control and coordinate the issuer's activities on a consolidated basis, as described in Securities Act Rules CDI 203.22 / Exchange Act Rules CDI 110.07, there is no single factor or group of factors that is determinative of whether an issuer's business is principally administered in the United States. Question 120.14, which provides that delegation of discretion to a broker to reduce the number of shares to be sold under a trading plan to comply with the Rule 144(e) volume limitations, was distinguished because the reductions in Question 120.14 reflect limitations imposed by law rather than an exercise of discretion by the seller. Answer: The rule is intended to apply broadly. [September 30, 2008]. Must the issuer file the periodic report? The Rule 13a-1 annual report would be due at the same time as any other such annual report. The registrant has been filing a combined Form 10-K report for those partnerships using the 33- file number from the Securities Act registration statement. Question: In applying the foreign private issuer definition in Securities Act Rule 405 and Exchange Act Rule 3b-4(c), what factors should be applied to determine the status of an individual as a "U.S. resident" for purposes of determining whether 50 percent of the company's outstanding voting securities are held of record by U.S. residents?