Question: At a time when he is not aware of material nonpublic information, a person buys a put option, giving him the right at any time during the 12-month term of the option to sell 10,000 shares at a fixed exercise price. Question: A company has filed a Form 25 which will become automatically effective on a Sunday. 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. Answer: An issuer may choose one of two methods. Answer: Yes. 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. To whom are the principal executive and financial officers disclosing significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, or fraud involving management or other employees who have a significant role in the registrants internal control over financial reporting? The Securities and Exchange Commission (the "SEC") recently approved final rules introducing new amendments and disclosure requirements under Rule 10b5-1 of the . Answer: As set forth in paragraph (a) of Rules 13a-14 and 15d-14, where an issuer does not have a principal executive officer or a principal financial officer, the person or persons performing similar functions at the time of filing of the report must execute the required certification. 26985 (June 28, 1989), 54 FR 28799. An issuer which files a Form 12b-25 for an extension of the period for filing a periodic report, and subsequently files a Form 15 under Rule 12g-4 prior to the expiration of the extension, would still be required to file the periodic report. Question: At a time when she is not aware of material nonpublic information, a person establishes a written trading plan to sell 5,000 shares each month, on a date to be selected by her broker during the second or third week of each month, at or above $20 per share. The securities of a successor issuer described in Rule 12g-3 are deemed to be registered under Section 12 by operation of law, and no Exchange Act registration statement on Form 8-A or any other form therefore need be filed. 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. 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. Does Rule 10b5-1(c)(1)(i)(B)(3) provide a defense for sales under this plan? Question: Do Rules 10b5-1(c)(1)(i)(A)(3) and (B)(1) provide a defense for sales under the written trading plan described in Question 120.11 when the limit order is discretionary (where the broker is granted discretion such that the broker is not required to execute a sale as soon as a buyer is available at or above $20 per share)? By contrast, under Rule 15d-6, if an issuer has fewer than 300 security holders of record at the beginning of the fiscal year, a Form 15 should be filed to notify the Commission of such suspension, but the suspension is granted by statute and is not contingent on filing the Form 15. 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. 240.12b-3 Title of securities. Controls and procedures with respect to interactive data fall within the scope of "disclosure controls and procedures." 25, 2009]. Securities Act Release No. 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. The fee rates set forth in Exchange Act Rule 0-11 do not apply. The person may transfer plan transactions to a different broker without being deemed to have cancelled the original plan and adopted a new plan if the transfer to the new broker is timed so that there is no cancellation of any transaction scheduled in the original plan, and the new broker effects sales in accordance with the original plans terms in compliance with Rule 10b5-1(c). Question: After its Form 25 is effective for the delisting of a class of securities from a national securities exchange (and assuming that the same class of securities is not listed on any other national securities exchange), a registrant files a Form 15 with respect to the Section 12(g) registration and/or Section 15(d) reporting obligation relating to the same class of securities. Where several Exchange Act reports are being amended at the same time, the amendments should not be made in a single filing. 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. (Release No. Rule 10b5-1(c)(1)(i)(B)(1) would not be available. Question: Which persons will be considered named executive officers for purposes of determining the parties for whom individualized disclosure pursuant to Item 6.F of Form 20-F must be provided? The company proposed that the plan provide for an automatic reduction in the aggregate number of shares authorized for repurchase under the plan equal to the number of shares, if any, that the company discloses in Form 10-Q, Part II, Item 2 that it has repurchased in privately negotiated transactions. The day's most visible group was Mothers Demand Action, members of which crowded the halls in a sea of red as they advocated lawmakers for gun control measures. 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? [Mar. Answer: No. Question: If the certifications required by Rules 13a-14(a) and 15d-14(a) are not included as exhibits to a Form 10-K or 10-Q, and an amendment will be filed to include the certifications as exhibits, must the entire periodic report be re-filed or can the amendment include only the signature page? 25, 2009]. [Mar. SECURITIES AND EXCHANGE COMMISSION . [September 30, 2008]. 25, 2009], 220.02 A company sought to establish a stock repurchase plan that would comply with Rules 10b5-1(c)(1) and 10b-18. Subsequently, the company will have a back-end merger. 25, 2009]. Answer: Yes, it is permissible to use a plain English equivalent in lieu of the words, "pursuant to Item 402 of Regulation S-K." [Feb. 11, 2011]. [September 30, 2008]. An application must be submitted to the Office of the Secretary either in paper or electronic format. If the company determines that it does not have a valid Section 10(a) prospectus, it should cease making any offers or sales under the registration statement that includes that prospectus. Question: For purposes of applying the primary trading market definition under Rule 12h-6(f)(5), may an issuer consider all securities trading markets in countries that are part of the European Union as a single foreign jurisdiction? For example, if a non-reporting foreign private issuer acquires a reporting foreign private issuer using shares as consideration in a transaction exempt from registration under the Securities Act (such as under Section 3(a)(10)), how should the non-reporting foreign private issuer begin filing on EDGAR? Washington, D.C. 20549 . 25, 2009]. At the time of filing such statement as the Commission may require pursuant to section 13 (e) (1) of the Exchange Act, a fee equal to the product of the rate applicable under section 13 (e) of the Exchange Act multiplied by the value of the securities proposed to be acquired by the acquiring person. 25, 2009]. The staff does not interpret the term to mean that the company cannot continue to use an already effective Form S-3 to make offers and sales during the extension period. [Mar. Question: Is it permissible for the say-on-frequency vote to include the words "every year, every other year, or every three years, or abstain" in lieu of "every 1, 2, or 3 years, or abstain"? 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. The person must make this specification or delegation in good faith before becoming aware of material nonpublic information. Answer: If the registrant has not filed a Form 10-K after the Rule 12b-25 extension period has run, and the registrant is not yet required to update the registration statement under Section 10(a)(3) of the Securities Act, the registrants ability to make offers and sales will depend on whether the company 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. See Securities Act Release No. The third party who has been granted discretion must not be aware of material nonpublic information when exercising that discretion. Assume that the due date of the periodic report is a Saturday, Sunday or federal holiday, and the effective date of the delisting occurs on the first business day following that due date. 111 provides that "a person acting in good faith may modify a prior contract, instruction, or plan before becoming aware of material nonpublic information. 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: Is an employee benefit plan with a Section 15(d) reporting obligation that files Forms 11-K, or that has its filing obligation satisfied by compliance with Exchange Act Rule 15d-21, required to file any other current or periodic reports under the Exchange Act? Answer: Yes. The person will need to file a Form 144. Answer: The officer should include his or her title under the signature. Answer: The cancellation of one or more plan transactions would be an alteration or deviation from the plan, which would terminate that plan. Rule 0-12 None Sections 110 to 119. 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: A companys obligation to file periodic reports was automatically suspended under Section 15(d) for fiscal year 2007 because the class of securities at issue was held by less than 300 record holders on the first day of the companys fiscal year. 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. A voluntary filer is not subject to Section 13(a) or 15(d) of the Exchange Act because it is not obligated to file Exchange Act reports pursuant to either of those provisions. (19) of Form 40-F must be provided? [September 30, 2008]. Question: Does canceling one or more plan transactions affect the availability of the Rule 10b5-1(c) defense for future plan transactions? 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. If it is not the titular CEO, the company should disclose in the filing that the certifying individual is performing the functions of a principal executive officer. [Apr. 2, 1980). 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 consent(s) of the accountant(s) for the acquired company should be filed with the Form 8-K. [September 30, 2008], 234.02 An issuer with a pending Securities Act registration statement files its Form 10-K and seeks to incorporate by reference into the Form 10-K information from the pending registration statement. Question: Under the 401(k) plan described in Question 120.21, is a Rule 10b5-1(c) defense available for fund-switching transactions that result in purchases or sales of employer stock? [September 30, 2008], 253.01 A registrant formed two limited partnerships, the A partnership and the B partnership, both having between 300 and 500 shareholders. Material may be filed by delivery to the Commission, through the mails or otherwise. [September 30, 2008]. However, the person would not be permitted to exercise subsequent influence over trust sales if the instrument creating the trust specified either (1) the percentage of the volume limit to be allocated to sales by the trust and other sales by the person, or (2) that the trustee would determine that allocation for each applicable three-month period without consulting the person. 2 Securities Exchange Act Release No. [September 30, 2008], 252.01 Rule 12g5-1 does not require an issuer to look through record ownership to the beneficial holders in determining whether it has 500 security holders for purposes of registration under Section 12(g) of the Exchange Act. Answer: In this case, a registrant would not have to file Section 13(a) reports during the period after the filing of the Form 15 through the effectiveness of the termination of the Section 12(g) registration and/or Section 15(d) reporting obligation, notwithstanding Rules 12d2-2(d)(6) and (7), if the company would not otherwise be required to file Exchange Act reports under Sections 13(a) or 15(d) of the Exchange Act. [September 30, 2008], 251.01 Following a tender offer, a company has sufficiently few shareholders to be eligible to file a Form 15 pursuant to Rules 12g-4 and 12h-3. [Mar. [Mar. 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. Answer: The foreign private issuer's initial filing to evidence the succession should be a Form 6-K announcing the succession, filed on EDGAR using the 8-K submission type that is appropriate to the specific transaction. The person may be aware of material nonpublic information when she places the limit order. Question: Because the clawback rule applies broadly to incentive-based compensation, would the rules affect compensation that is in any sort of plan, other than tax-qualified retirement plans, including long term disability, life insurance, SERPs, or any other compensation that is based on the incentive-based compensation? Question: For purposes of the definition of foreign private issuer in Securities Act Rule 405 and Exchange Act Rule 3b-4(c), how does an issuer determine whether its business is administered principally in the United States? See Securities Act Release No. Some of these C&DIs were first published in prior Division publications and have been revised in some cases. The issuer is not otherwise required to file Exchange Act reports under Sections 13(a) or 15(d) of the Exchange Act after the effective date of the delisting. [September 30, 2008]. The in connection with requirement is satisfied when a fraud coincides with a securities transaction. Question: In applying the foreign private issuer definition in Securities Act Rule 405 and Exchange Act Rule 3b-4(c), how can an issuer that has multiple classes of voting stock with different voting rights determine whether more than 50 percent of its outstanding voting securities are directly or indirectly owned of record by residents in the United States? Question: At a time when he is not aware of material nonpublic information, a person purchases a put option. These Compliance and Disclosure Interpretations ("C&DIs") principally comprise the Division's interpretations of the rules promulgated under the registration and reporting provisions of Sections 12, 13 and 15 of the Exchange Act. Answer: Yes, assuming the conditions of that rule are satisfied. Answer: No. Answer: No. Question: Must the vote on say-on-frequency, as required by Rule 14a-21(b), be in the form of a "resolution"? Other than the referenced section, the process and registration statements used are the same as for a Section 12 (g) registration. [Mar. Should this other officer sign the certification despite the fact that there is a titular CEO? Such individualized disclosure is required about executive officers for whom the issuer otherwise provides individualized compensation disclosure in the filing. [September 30, 2008]. 7881 (Aug. 15, 2000) at fn. Answer: No. Answer: Yes. The same analysis applies whether the option is a put or a call. However, the listing standards are not required to be effective until November 28, 2023 and issuers subject to such listing standards will not be required to adopt a recovery policy for 60 days following the date on which the applicable listing standards become effective. Notwithstanding the due dates prescribed by Rule 15d-10(j)(1) for transition reports to be filed on the form appropriate for annual reports of the issuer, the Division staff took the position that the short-year Form 11-K could be filed 180 days after the plans fiscal year end. 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. 3 SECURITIES EXCHANGE ACT OF 1934 4 ties the functions commonly performed by a stock exchange as that term is generally understood, and includes the market place and the market facilities maintained by such exchange. Must the issuer file the periodic report? Unless this condition is met, the 45 day relief period provided in COVID-19 Order will not be available. The company appointed a new CEO prior to the filing. Question: Where the registrant is a limited partnership that does not have an audit committee, who should be considered the persons performing the equivalent function as referenced in paragraph 5 of the certifications required by Rules 13a-14(a) and 15d-14(a)? Answer: No. 16718 (Apr. Will issuers be required to mark the check boxes in 2023 before an issuer is required to adopt a recovery policy and comply with the applicable listing standards? 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). The terms of the option, which is a binding contract within the meaning of Rule 10b5-1(c)(1)(i)(A)(1), specify the amount of shares to be sold and the price at which they will be sold under the option. Rule 10b5-1(c)(1)(i)(B)(3) contemplates that a person, while not aware of material nonpublic information, may delegate to a third party under a contract, instruction or written trading plan, all subsequent influence over how, when or whether to effect purchases or sales. The Section 15 (d) reporting requirements are scaled down from the Exchange Act reporting requirements for a company with a class of securities registered under Section 12. [March 31, 2020]. If he is aware of material nonpublic information at the time of exercise, can he rely on a Rule 10b5-1(c) defense in exercising the option? Rule 0-13 Commission procedures for filing applications to request a substituted compliance order under the Exchange Act. [September 30, 2008]. [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. Answer: No. Answer: The registrants first Form 10-K should be filed with respect to its fiscal year ended December 31, 2007. Question: Must co-principal executive officers (or co-principal financial officers) execute separate certifications or may both execute the same certification? Form 11-K provides that the due date for an ERISA plans Form 11-K is 180 days after fiscal year end. (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. Question: Is a company required to file a Form 12b-25 even when it anticipates filing a periodic report after the Rule 12b-25 extension period? 25, 2009]. Is the sale pursuant to the option exercise covered by an affirmative defense under Rule 10b5-1(c)? Question: An issuer does not have a principal executive officer or a principal financial officer. Answer: Yes. In this example, the person has retained discretion over the timing of the option exercise. The B partnership is now eligible to suspend filing pursuant to Rule 12h-3 because it has had less than $10 million in assets for its last three fiscal years. These exemptive requests, if submitted electronically, must be sent to: Section 36 Exemptive Applications The registrant would still need to file a Form 10-K for the last fiscal year because the Form S-3 and Form S-8 were updated that year. Question: If a registrant with a December 31 fiscal year-end files a Form 10 in November 2007 which goes effective in January 2008, what is the first Form 10-K that the registrant is required to file? In such cases, a transition report would not be required. Although Rule 12g-3 does not provide for the succession to the predecessors Section 12(g) registration if at the time of the succession the securities of the class are held by fewer than 300 record holders, the Division staff has taken the position that Section 12(g) registration could be voluntarily continued by the successor pursuant to Rule 12g-3 in these circumstances without the filing of a new Exchange Act registration statement. [September 30, 2008]. Question: Under Exchange Act Rule 12g-3, must a Form 8-A, or any other form, be filed in order for the securities of a successor issuer to be deemed registered under Section 12? 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? Question: If the same individual is both the principal executive officer and principal financial officer, must he or she sign two certifications? The Form 144 must be transmitted for filing concurrently with either the placement of a sell order for a brokerage transaction, or the execution of such sale directly with a market maker, as provided in Rule 144(h). [September 30, 2008]. [March 31, 2020]. See Securities Act Release No. The Answer: Rule 12b-25(d) provides that, during the extension period, a company will not be eligible to use any registration statement form under the Securities Act the use of which is predicated on timely filed reports until the subject report is actually filed. The staff interprets the term use contained in the rule to mean that a company would not be eligible to file a new registration statement on Form S-3 until the subject report is filed within the extension period. Is the Rule 10b5-1(c)(1)(i)(B)(3) defense available to the person when the bank sells the stock? (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. Question: Does termination of a plan affect the availability of the Rule 10b5-1(c) defense for prior plan transactions? [Mar. 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. Question: A CEO resigned after the end of the quarter but before the filing of the upcoming Form 10-Q. 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? 25, 2009]. [September 30, 2008]. 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? The Rule 10b5-1(c) defense would be available for transactions following the alteration only if the transactions were pursuant to a new contract, instruction or plan that satisfies the requirements of Rule 10b5-1(c). 240.12b-5 Determination of affiliates of banks. The notice on Form 144 is effective for a maximum of three months, so that sales over longer periods will involve multiple requirements of notice under Rule 144(h). Question: Are there any additional extensions for the timely filing of periodic reports beyond those provided in Rule 12b-25? An amendment to Form 10-K does not require signatures of the majority of the board of directors. 78c(a)(47)). 7881 (Aug. 15, 2000), text at fn. Question: Is the institutional defense provided by Rule 10b5-1(c)(2) available to the issuer of the securities for a repurchase plan? Answer: Item B. [December 8, 2016]. Answer: No. 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. Under Rule 12b-25(a), a company must file a Form 12b-25 for a periodic report that is filed after the due date regardless of whether it anticipates filing the periodic report within the extension period. Title V of the Act is classified principally to chapter 94 (6801 et seq.) 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. eCFR :: 17 CFR Part 240 -- General Rules and Regulations, Securities Exchange Act of 1934 eCFR The Electronic Code of Federal Regulations Title 17 Displaying title 17, up to date as of 2/08/2023. Question: Could fund-switching transactions under the 401(k) plan described in Question 120.21 be considered "corresponding or hedging transactions" within the meaning of Rule 10b5-1(c)(1)(i)(C) with respect to payroll deduction purchases under the 401(k) plan? The Form 10-K must be amended by the 120th day to disclose the Part III information if the definitive proxy statement has not been filed, as stated in the general instruction. If, however, the person is acting in good faith and provides instructions for the fund-switching transaction at a time when she is not aware of material nonpublic information, the fund-switching transaction would not disturb the Rule 10b5-1(c) defense for a payroll deduction purchase under the 401(k) plan. See Securities Act Release No. Question: Can an issuer that submits Exchange Act reports on a voluntary basis satisfy the definitions of accelerated filer or large accelerated filer in Rule 12b-2? Instead, each of the depositorys accounts for which the securities are held is a single record holder. Question: Does Rule 12a-5 provide an exemption from registration for poison pill rights under stockholder rights plans? In establishing the trust, she specifies that the trust shall sell 1,000 shares of issuer stock each quarter. [September 30, 2008]. [January 27, 2023]. Moreover, if a person established a new contract, instruction or plan after terminating a prior plan, then all the surrounding facts and circumstances, including the period of time between the cancellation of the old plan and the creation of the new plan, would be relevant to a determination whether the person had established the contract, instruction or plan in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b5-1(c). [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.
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