More Hurricane Sandy Relief from the SEC

News Brief

By Cydney Posner

The SEC has issued an order providing regulatory relief to publicly traded companies and others affected by Hurricane Sandy.

Among other things, the order conditionally exempts registrants, and any person required to make any filings with respect to such a registrant, that could not timely file because of Hurricane Sandy as follows:

  • From any requirement to file or furnish materials with the SEC under Exchange Act Sections 13(a), 13(d), 13(f), 13(g), 14(a), 14(c),15(d) and 16(a), Regulations 13A, 13D, 13G, 14A, 14C and 15D, and Exchange Act Rules 13f-1 and 16a-3 for the period from October 29, 2012 to November 20, 2012, provided that the filer files the report, schedule or form that would otherwise have been due on or before November 21, 2012, discloses that the filer is relying on the exemptive order and the reasons why, in good faith, it could not file on a timely basis; and
  • From the proxy and information statement delivery requirements for companies or others attempting to deliver materials to affected areas provided that:
    • The registrant's security holder has a mailing address located within a zip code where, as a result of Hurricane Sandy, the USPS has suspended mail service of the type or class customarily used by the registrant;
    • The registrant or other person making a solicitation has followed normal procedure when furnishing the soliciting materials to the security holder in order to ensure that the soliciting materials preceded or accompanied the proxy, as required by the rules applicable to the particular form of soliciting materials (comparable condition for information materials); and
    • If requested by the security holder, the registrant or other person provides the soliciting or information materials by a means reasonably designed to furnish them to the security holder.

There are similar types of provisions for investment companies and transfer agents, as well as a special provision that allows auditors to help companies reconstruct accounting records that were lost or destroyed as a result of Hurricane Sandy without loss of auditor independence.

The related press release indicates that the SEC has directed the staff to take the following positions regarding issues that may commonly arise:

  • For purposes of eligibility to use Form S-3 (as well as WKSI status, which is based in part on Form S-3 eligibility) for a company relying on the exemptive order, any of that company's Exchange Act reports that would have been required to be filed during the period from October 29, 2012 to November 20, 2012 will be due by November 21, 2012. That company will, therefore, be considered:
      • Current in its Exchange Act reports otherwise due prior to November 21, 2012 if it was current in its Exchange Act reports as of October 28, 2012
      • Current in its Exchange Act reports as of November 21, 2012 if it was current as of October 28, 2012, and  it has made any filings required during the period from October 29, 2012 to November 20, 2012 (presumably has caught up with its filings that were otherwise due during the period)
      • Timely in its Exchange Act reports prior to November 21, 2012 if it was timely as of October 28, 2012
      • Timely in its Exchange Act reports as of November 21, 2012 if it was timely as of October 28, 2012 and it has made any filings required during the period from October 29, 2012 to November 20, 2012 on or before November 21, 2012

For purposes of the Form S-8 eligibility requirements and the current public information eligibility requirements of Rule 144(c), a company relying on the exemptive order will be considered:

  • Current in its Exchange Act reports prior to November 21, 2012 if it was current in its Exchange Act reports as of October 28, 2012
  • Current in its Exchange Act reports as of November 21, 2012 if it was current in its Exchange Act reports as of October 28, 2012 and it has made any filings required during the period from October 29, 2012 to November 20, 2012

Companies that receive an extension on filing Exchange Act annual reports or quarterly reports pursuant to the order will be considered to have a due date of November 21, 2012 for those reports for purposes of Exchange Act Rule 12b-25. As a result, those companies will be permitted to rely on Rule 12b-25 where they are unable to file the required reports on or before November 21, 2012.

To the extent that companies and other affected persons require additional or different assistance, the staff will address these and any disclosure-related issues on a case-by-case basis.