By Liz Dunshee and Reid Hooper
Our Cooley teams are working with clients to plan ahead for the looming government shutdown. For companies on the verge of the IPO, the staff has informally shared an important pre-shutdown accommodation that we didn’t have during the last go-round.
The staff of the Division of Corporation Finance will be willing to accelerate effectiveness for IPO issuers that have cleared comments and flipped public but are still waiting for the 15 days to run. This applies only during the pre-shutdown period of today and tomorrow (Thursday and Friday, January 29 and 30).
The following conditions apply here:
- The IPO filing must have cleared SEC comments;
- The issuer must have flipped their confidential filing to public on or after January 16 (i.e., the 15-day period that is typically required between filing the public registration statement and going effective / commencing the road show will not have run by the time the shutdown commences);
- The issuer must request effectiveness on the eve of the shutdown (i.e., late in the afternoon on Friday, January 30). Issuers cannot request effectiveness on Thursday, January 29 under this accommodation; and
- The issuer must provide an undertaking to the staff via correspondence on EDGAR confirming that the road show process will not commence until 15 days after the public flip.
As we learned last fall, a government shutdown doesn’t necessarily close the market window. IPOs and other offerings are still possible under some circumstances, and now is the time for scenario planning.
For example, if you’re in the (relatively unique) situation of having flipped your registration statement to public prior to January 16, but had planned to request effectiveness after January 30, you may want to adapt to go effective before the government shuts down.
If your company is working through or considering an IPO, please reach out to your Cooley counsel to discuss the accommodation above and other government shutdown planning.
