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  • Neil R. E. Carr

SEC Adopts Interim Final Rules to Implement Certain Sections of FAST Act

January 21, 2016

On January 13, 2016, the Securities and Exchange Commission (“SEC”) adopted interim final rules implementing Sections 71003 and 84001 of the Fixing America’s Surface

Transportation (“FAST”) Act which require the SEC to:

  • revise Forms S-1 and F-1 to permit emerging growth companies (“EGCs”) to omit financial information for certain historical periods under certain circumstances, and

  • revise Form S-1 to permit forward incorporation by reference for certain smaller reporting companies

The interim final rules became effective on January 19, 2016.

Form S-1 is the SEC registration statement form utilized by domestic issuers to register the offer and sale of securities under the Securities Act of 1933, as amended (“Securities Act”), when no other form is available. Form F-1 is the equivalent form for foreign private issuers

Simplified Disclosure Requirements for EGCs

Section 71003 of the FAST Act amends Section 102 of the JOBS Act to permit an EGC that is filing or submitting a Form S-1 or Form F-1 registration statement to omit financial information for historical periods otherwise required by Regulation S-X if it reasonably believes the omitted information will not be required to be included in the filing at the time of the contemplated offering as long as the issuer amends the registration statement prior to distributing a preliminary prospectus to include all financial information required at the time of the amendment.

Forward Incorporation by Reference in Form S-1 by Smaller Reporting Companies

Section 84001 of the FAST Act requires the SEC to revise Form S-1 to permit a smaller reporting company to incorporate by reference into its registration statement reports that it files under the Securities Exchange Act of 1934, as amended (“Exchange Act”), subsequent to the effective date of the registration statement. The new interim final rules implement this requirement.

To be eligible to use forward incorporation by reference in a registration statement on Form S-1, a small reporting company will be required to be current by having filed:

  • an annual report for its most recently completed fiscal year, and

  • all required Exchange Act reports during the 12 months immediately preceding filing of the Form S-1

The following smaller reporting companies are not permitted to forward incorporate by reference:

  • blank check companies

  • shell companies (other than business combination related shell companies)

  • penny stock issuers

As a condition of forward incorporation by reference, a smaller reporting company is required to make its Exchange Act reports and other materials readily available and accessible on its web site and disclose in the prospectus that such materials will be provided upon request.

The amendment to the Form S-1 will, in particular, make it easier for smaller reporting companies using Form S-1 as a resale shelf registration statement or conducting continuous offerings to update their Form S-1 registration statements without the need to file an amendment or prospectus supplements to disclose material developments.

For more information, please contact: Neil R.E. Carr Direct Dial: +1 202 587 2983

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