Form D serves as the official notice of an offering of securities made without registration under the Securities Act of 1933 by either a public or a private company in reliance on an exemption provided by Regulation D. On February 6, 2008, the Securities and Exchange Commission announced that it had revised Form D to simplify and restructure its informational disclosure requirements. The SEC further announced that every Form D would be required to be filed with the SEC electronically through a new online filing system that would be accessible from any computer with internet access, with the data being both interactive and searchable (Release No. 33-8891; 34-57280; 39-2453; IC-28145). This is the first time in almost 20 years that the SEC has revised the Form D requirements.
The revisions to Form D are effective September 15, 2008. Beginning on that date, issuers will have the option of filing Form D either in paper copy or electronically. If a paper form is used, the issuer may use either the current form or a printed version of the new electronic form. Beginning March 16, 2009, every Form D must be filed with the SEC electronically.
Revisions to Form D
The revisions are intended to ease the costs and burdens of preparing and filing a Form D by streamlining and updating the disclosure requirements. Currently, Form D requires presentation of preliminary and other information in five sections. The revisions organize the information requirements around 16 numbered items, or categories, of information. Instructions at the end of the form explain the requirements for each item. With its changes, the SEC will:
The Form D will continue to be filed with the SEC not later than 15 days after the first sale of securities in reliance on the exemption.
Timing of New Amendment Provisions
If an issuer must amend a Form D that was filed before September 15, 2008, it can continue to comply with the current amendment provisions until March 15, 2009. Beginning September 15, 2008, the issuer has the option of complying with the new amendment provisions discussed above, and between September 15, 2008, and March 15, 2009, it has the option to file the amendment in either paper or electronic form. If an issuer must amend a Form D that was filed after September 14, 2008, it must comply with the new amendment provisions, although it still has the option of filing the amendment in paper form or electronic form until March 15, 2009.
Beginning March 16, 2009, all issuers must comply with the new amendment provisions and all amendments must be filed in electronic form.
Electronic Filing of Form D
The electronically filed forms will be available on the SEC's web site, accessible from any computer with internet access, fully interactive and searchable. The filing system, currently in development, will enable users to view the information in an easy-to-read format, download the information into an existing application or create an application to use the information. Issuers will be able to submit and amend the forms on this system.
Although not part of the EDGAR system that public companies use, in order to file the Form D, issuers will need the same codes as are required to file electronically on EDGAR. As currently contemplated, to the extent that an issuer does not have such codes, it will have to file a Form ID with the SEC, although the SEC is currently reviewing this to determine whether to make a more simplified process available to Form D filers. If there are multiple issuers, each issuer will need its own set of EDGAR filing codes.
The terms and items at the front of the online Form D will be linked to the instructions at the back, which will be available immediately by clicking on a particular term or item.
Issuers will continue to make filings with the various states in connection with their private offerings in the whatever format is prescribed by the state, most often by the filing of a copy of the Form D. But it is important to note that the SEC and the North American Securities Administrators Association are exploring whether to coordinate the filing requirements in a form of "one-stop filing."
General Solicitation and General Advertising Concerns
Rule 502(c) of Regulation D prohibits issuers and persons acting on the issuer's behalf from offering or selling securities by any form of general solicitation or general advertising. The electronic filing and availability of Form D information may raise the concern that the filing could be used as a marketing document to generate interest in offerings because the information would be easily and broadly available. The SEC has revised Rule 502(c) to include a safe harbor from the prohibition on general solicitation and general advertising for information provided in a Form D if the information is provided in good faith and the issuer makes reasonable efforts to comply with the requirements of Form D.
Michael Hermsen has an extensive corporate and transactional
focuses on securities matters. He
represents issuers, underwriters
and securityholders in connection with public and private
equity and debt securities. Mike also represents corporate
connection with Securities Act and Exchange Act compliance and
and compliance with NYSE and Nasdaq regulations, and counsels
of directors and management on stock purchases, executive compensation
and other corporate governance matters.
In the area of mergers and acquisitions, Mike represents buyers and sellers in connection with public and private acquisitions and divestitures, mergers, tender offers, exchange offers and consent solicitations.
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