COBRADesk to be Replaced

By Cydney Posner

FINRA has announced that, on June 4, 2012, it will introduce a new public offering filing system replacing COBRADesk, which will be retired on June 20, 2012. FINRA Regulatory Notice 12-22 The new system will be used for public offerings that are required to be filed under FINRA Rules 5110, 5121 and 2310 (Corporate Financing Rules). FINRA will not migrate data from COBRADesk to the new system and, therefore, offerings that were filed in COBRADesk and that are under review as of that date must be refiled in the new system. No additional fees will apply (unless the offering is increased). Instructions for printing filings submitted through COBRADesk and saving and exporting files are provided on the log-in page for COBRADesk and will also be provided by email upon request to corpfin@finra.org. FINRA will be providing online training before the new system is implemented and will post additional information on its website. (See the FINRA chart below.)

• Through June 20, 2012: Transfer and archive data from filings submitted in COBRADesk
• May 15 through June 1: Firms may request an exemption from the timely filing requirements until the new system is available on June 4
• May 31: Last day to file a new public offering in COBRADesk
• June 1: New public offering filings will no longer be accepted in COBRADesk.  Please contact Corporate Financing to make arrangements regarding any expedited offering that must be filed on June 1 (e.g., overnight "bought deals", SDCs,WKSis) at corpfin@fjnra.org
• June 4: New Public Offering System available for all types of filings
• June 11: End of the exemption period from the timely filing requirements
• June 20: Last day to retrieve data from COBRADesk

The new system has some more bells and whistles and is touted as more intuitive and user friendly. For example, users will be able to print a list of "errors" that must be addressed before submitting the filing. In addition, the filing process for shelf offerings will expand the current "same day clearance" process in COBRADesk to all shelf offerings except those for which a firm voluntarily elects to have the takedown filing reviewed by Corporate Financing.

With regard to updates of existing filings during the changeover:

If an offering is filed in COBRADesk before May 31, 2012, and a subsequent update would not change the underwriting terms and arrangements or the information provided to FINRA as part of its review of those arrangements, and would not change the size of the offering, then filing the update in the new system will not be necessary. Instead, firms may send the update by email to CFupdates@finra.org. FINRA will provide instructions for emailing these updates to filings submitted through COBRADesk on its website along with a user guide for the Public Offering System.

However, if a subsequent update would change the underwriting terms and arrangements, the information provided to FINRA as part of its review of those arrangements, or the offering size, unless Corporate Financing has cleared the offering with the update before June 20, the offering will have to be refiled with the update in the new system.

With regard to shelf offerings:

On May 31, FINRA will transfer the file IDs of all base shelf prospectuses that have been cleared by that date to the new system. This will enable subsequent shelf takedowns to be filed in the new system without requiring firms to refile the base prospectuses. As most base shelf offerings receive same day clearance, Corporate Financing expects that virtually all of the base prospectuses filed by that date will be in the new system and available for takedowns once the new system is available on June 4. However if a base shelf prospectus was filed but not cleared by May 31, it must be refiled in the new system and be cleared before a takedown can be filed. All shelf takedowns must be filed in the Public Offering System after May 31.

To assist with transition, FINRA will be issuing exemptions from the one-business day filing rule for those desiring to delay filing with FINRA until the new system is available. The exemptive period begins on May 15, 2012, and filers receiving an exemption have until June 11, 2012, to enter filings in the new system. The exemption will not shorten the regulatory review process. Email FINRA at CFexemption@finra.org, notifying the staff and providing basic information as follows:

• name of the issuer;
• name of the lead managing underwriter or FINRA member firm responsible for submitting the filing;
• SEC registration number where applicable;
• identity and contact information of the person requesting the exemption and their relationship to the FINRA member; and
• the anticipated effective or pricing date.

Member firms will be able to access the new system through FINRA's Firm Gateway®. Non-member filers (e.g., outside counsel) must receive "entitlement" to access the new system. The entitlement process (forms available on FINRA's website) may take 48 hours from the time of the request, so plan ahead.

For confidential submissions to the SEC under JOBS Act provisions for EGCs, timely filings with FINRA are still required; however, the modified filing process for confidential offerings available under COBRADesk will continue to be available in the Public Offering System. All filings with FINRA pursuant to the Corporate Financing Rules are nonpublic.

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