The Staff of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (the “SEC”) recently updated its Frequently Asked Questions on Title I of the Jumpstart Our Business Startups Act (“JOBS Act”) to address a number of issues regarding the applicability of the provisions in Title I to exchange offer, merger and spin-off transactions, as well as considerations for determining whether a company qualifies as an emerging growth company (an “EGC”) and the financial information that an EGC includes in certain filings. The SEC also recently implemented a process whereby an EGC can submit its draft registration statement for confidential review via the EDGAR system. In this regard, the Staff has provided additional guidance as to how EGCs with pending submissions can transition to the new EDGAR filing process. To read our client alert, click here.
In connection with the recent migration of draft registration statement submissions to EDGAR, the SEC Staff sent letters to companies with draft registration statements subject to an ongoing review process, advising those companies how to submit a draft registration statement through EDGAR.
The letter notes that companies with pending draft registration statements already have a Central Index Key, or CIK number, assigned to them. In order to initiate the EDGAR submission process, it is necessary to:
1. Submit a request to the SEC asking that the company’s EDGAR status be converted to an electronic filer;
2. Request the access codes and passwords necessary to submit the registration statement on the EDGAR system; and
3. Make any necessary changes to the company’s contact information and business and mailing addresses in EDGAR prior to making an initial filing, including the secure email address that the Staff will use to send comment letters.
The Staff notes that the first EDGAR draft submission should be made as a new draft registration statement, even if it is an amendment to a previously submitted version. The first EDGAR submission should also include each previously submitted draft registration statement (including exhibits) as a separate Exhibit 99 document. No marked submissions should be provided. Each item of correspondence also must be provided with the initial EDGAR submission as a separate “COVER” document within the submission.
The Staff also reminds companies to properly mark confidential information if they intend to use Rule 83 to request confidential treatment in the correspondence submitted via EDGAR.
The Division of Corporation Finance confirmed that beginning on October 1, 2012, an EGC may submit its confidential draft registration statement through the EDGAR system. Once an issuer chooses to rely on EDGAR submissions, it cannot opt to change to paper submissions through the secure email system. The SEC will provide instructions on transitioning from the secure email system submissions to EDGAR for those EGCs that have submissions pending. See http://www.sec.gov/divisions/corpfin/cfannouncements/drsfilingprocedures.htm.
Under Title I of the JOBS Act, an emerging growth company may confidentially submit a draft registration statement for an initial public offering for nonpublic review, provided that the initial confidential submission and all amendments are publicly filed with the SEC no later than 21 days prior to the issuer’s commencement of a road show. The confidential submission process has proven to be a popular aspect of the JOBS Act’s IPO on-ramp provisions, given that emerging growth companies can go through a substantial portion of the SEC review process without (immediate) public disclosure of changes made in response to SEC Staff comments.
Presently, the SEC Staff accepts draft registration statements in a text-searchable PDF file submitted through a secure e-mail system. Last week, the SEC adopted a new EDGAR Filer Manual, which contemplates confidential EDGAR submissions of draft registration statements. Once the programming is completed for these changes, draft registration statements and amendments to draft registration statements will be submitted via EDGAR using submission form types DRS and DRS/A, respectively. We have heard from the SEC Staff that the necessary changes to the EDGAR system should be completed by some time in October. In the meantime, emerging growth companies should continue to use the secure e-mail system for their draft registration statement submissions.