Public companies unable to meet their SEC filing deadlines due to circumstances related to COVID-19 may qualify for relief under an SEC March 25 order. The filing relief can now be applied to March 31, 2020 Forms 10-K and 10-Q. Also, the staff of the SEC’s Division of Corporation Finance has provided its current views on a number of COVID-19-related matters.
On March 25, the SEC issued an order extending the time period covered by its COVID-19-related filing relief. The March 25 order supersedes the SEC’s March 4 order.
Under the March 25 order, public companies that are unable to meet filing deadlines due to COVID-19-related circumstances will have an additional 45 days to submit certain disclosure reports (e.g., Forms 10-K, 10-Q, 20-F) that would otherwise have been due between March 1 and July 1, 2020. As a result, the relief can now be applied to March 31, 2020 Forms 10-K and 10-Q. The prior relief was only available to filings due on or before April 30, 2020.
The SEC’s filing relief continues to be conditioned on a number of factors that are listed in the March 25 order, including that the company furnishes a Form 8-K (or Form 6-K if applicable) describing that it is relying on the order and disclosing, among other things:
the reasons why it could not make the filing on a timely basis;
the estimated date the filing is expected to be made; and
a company-specific risk factor or factors explaining the impact, if material, of COVID-19 on its business.
Additionally, if the reason that the report cannot be filed on time relates to the inability of a person other than the company to furnish a required opinion, report, or certification, the Form 8-K (or Form 6-K) must include a signed statement from that person stating the specific reasons why that opinion, report, or certification could not be furnished.
Companies must furnish a Form 8-K (or Form 6-K) for each filing that is delayed. The Form 8-K (or Form 6-K) must be furnished by the original filing deadline. Companies would not need to file a Form 12b-25 (Notification of Late Filing) as long as the report is filed within the 45 day time frame.
The SEC also reiterated its previous guidance for how the relief will impact certain other areas, such as eligibility to use Forms S-3 and S-8 and the availability of the SEC’s existing late filing notification requirements (Exchange Act Rule 12b-25) for annual and quarterly reports that are subject to the 45-day extension but are not able to be filed by the extended due date.
Separately, the SEC reminded all public companies and related persons (e.g., officers, directors, corporate insiders) to consider their activities (e.g., engaging in securities transactions with the public) in light of their disclosure responsibilities under the federal securities laws. The SEC also reminded companies to consider their responsibilities to avoid selective disclosure and to consider whether they “may need to revisit, refresh, or update previous disclosure to the extent that the information becomes materially inaccurate.”
Also on March 25, the staff of the SEC’s Division of Corporation Finance (Corp Fin) published CF Disclosure Guidance: Topic 9, Coronavirus (COVID-19), which:
provides several questions for companies to consider as they evaluate their disclosure obligations;
echoes the SEC’s guidance regarding the need to refrain from trading prior to dissemination of material non-public information and to avoid selective disclosure;
encourages companies to proactively address financial reporting matters earlier than usual (including prompt engagement with specialists, as necessary); and
discusses matters relating to earnings releases and non-GAAP measures (including reconciliation in an earnings release when the GAAP measure may not yet be available).
The SEC’s press release announcing the topics discussed above also covered topics relating to funds and investment advisors.
The SEC continues to closely monitor the impacts of COVID-19 on investors and markets and will consider additional or extended relief as appropriate. The SEC noted that some companies may need additional or different assistance and encouraged them to contact the SEC staff.