On August 17, 2017, the SEC staff issued two new C&DIs (Securities Act Forms 101.04 and 101.05) to clarify the financial information that emerging growth companies (EGCs) and other issuers can omit from confidentially submitted draft registration statements. An issuer can omit interim financial information if it anticipates that the registration statement will not, at the time of the contemplated offering (or, in the case of non-EGCs, at the time of public filing), require separate interim financial statements. For example, a draft registration statement submitted by a calendar-year issuer in November 2017 would ordinarily be required to include financial information for the nine months ended September 30, 2016 and 2017. If the offering is anticipated to occur in January 2018, the issuer could not omit that information, since a registration statement for an offering at that time would be required to include the interim information. In contrast, if the offering (or, in the case of non-EGCs, the public filing) is anticipated to occur in April 2018, the issuer could omit the interim financial information, since a registration statement for an offering in April would instead be required to include audited financial statements for the full calendar years 2016 and 2017. For non-EGCs, it is important to note that it is the date of the first public filing that determines what financial statements are required, rather than the date of the offering (e.g., the date of the red herring to be used in the roadshow).
The guidance reaffirms the staff’s position that drafts must nonetheless include required financial information for interim periods that are anticipated to be superseded by longer interim periods for the same year. For example, an issuer submitting a draft in September 2017 for an offering in December 2017 could not omit financial information for the six months ended June 30, 2016 and 2017, since a registration statement for such an offering would be required to include financial information for the nine months ended September 30, 2016 and 2017.
Lastly, the guidance confirms that non-EGCs can omit financial information for annual periods that will not be required at the time of public filing. Thus, a non-EGC filing a draft in November 2017 with an anticipated public filing in April 2018 can omit financial information for 2014, since the publicly filed registration statement will include information for 2015, 2016 and 2017.