Have you issued public debt? If so, you are going to want to be aware of the amendment the SEC approved to Rule 12c2-12.
Effective February 27, 2019, all broker-dealers buying or selling municipal securities, governments, as well as any other obligated persons who issue obligations subject to the Rule will be required, through contractual undertakings, to commit to additional continuing disclosure requirements. This means that governments will have to agree in new continuing disclosure agreements (CDAs) (including supplements to master agreements for new bond transactions) entered into on or after February 27, 2019, that they will disclose to the market (via EMMA):
- Any new material financial obligations, and
- When certain events occur with respect to outstanding or new financial obligations that reflect financial difficulties, in both cases within 10 business days of the occurrence of the event.
The SEC has defined “financial obligations” to be obligations that are debt-like, related to debt or debt-related products, and not normal business operations. The types of financial obligations that are captured under the SEC approved amendments include:
- Bank loans,
- Capital leases or financed purchases,
- Guarantees, and
- Other types of financial obligations that “operate as vehicles to borrow money.
If you need further information regarding this change to public debt disclosure requirements, click here.
Cailee Lewis, CPA