An 8K is a filing with the Securities and Exchange Commission (SEC) from a public company that is making a big change or announcing a big event that could have a material impact on the stock price. The SEC is a government agency that exists to protect public market investors and ensure that markets function smoothly and fairly.
What is an 8-K form?
An 8-K is a filing that companies use to relate important but irregular corporate events to the public. The form has many components investors need to know about. The Securities and Exchange...
What's going on with my company's 8-K?
One way to keep up with what's going on with the companies you own stock in is to check out the forms they are required to file with the U.S. Securities and Exchange Commission. (Company filings can be found through the SEC's EDGAR database .) An 8-K is a filing that companies use to relate important but irregular corporate events to the public.
Do I need to file an 8-K For an acquisition agreement?
If Item 1.01 is triggered, then the registrant will be required to file a Form 8-K setting forth certain information regarding the acquisition agreement (including the material terms and conditions of the agreement) within four business days following the execution of the agreement.
When do publicly traded companies file an 8-K?
Publicly traded companies must file an 8-K in the event of any material event (other than those that occur regularly, such as earnings) that would be important to investors. Image source: Getty Images. What is a "material event"?
What requires an 8-K filing?
A. Form 8-K shall be used for current reports under Section 13 or 15(d) of the Securities Exchange Act of 1934, filed pursuant to Rule 13a-11 or Rule 15d-11 and for reports of nonpublic information required to be disclosed by Regulation FD (17 CFR 243.100 and 243.101). 2.
What triggers a Form 8-K?
item is triggered when the company enters into an agreement enforceable against the company, whether or not subject to conditions, under which the equity securities are to be sold. If there is no such agreement, the company should file the Form 8-K within four business days after the closing of the transaction.
When must a company file an 8-K?
Form 8-K is the “current report” companies must file with the SEC to announce major events that shareholders should know about. Other Events (The registrant can use this Item to report events that are not specifically called for by Form 8-K, that the registrant considers to be of importance to security holders.)
Why would a company file an 8K?
Form 8-K, also known as an 8K, is a form that is filed by public companies to notify their shareholders and the Securities and Exchange Commission (SEC) when an unscheduled material event takes place.
What is the purpose of Form 8-K?
Form 8-K is known as a “current report” and it is the report that companies must file with the SEC to announce major events that shareholders should know about. Companies generally have four business days to file a Form 8-K for an event that triggers the filing requirement.
What happens if you file an 8-K late?
Form 8-K Filed Late, SEC Action: Late filing will likely result in administrative action. The severity of the penalties depend on the reason for filing late and when the report was eventually filed. Fines are typical. For severe cases, a company's Exchange Act registration may be revoked.
Is an 8 Ka press release?
Form 8-K: A Legal Requirement for “Material” Events In the most general terms, Form 8-K is an SEC disclosure vehicle used to provide the public with information deemed necessary to make an informed investment decision about a public company.
What is a 10-K for a publicly traded company?
What Is a 10-K? A 10-K is a comprehensive report filed annually by a publicly-traded company about its financial performance and is required by the U.S. Securities and Exchange Commission (SEC).
What is an 8-K?
An 8-K is a filing that companies use to relate important but irregular corporate events to the public. The form has many components investors need to know about. The Securities and Exchange Commission requires all companies publicly traded on a U.S. stock exchange to regularly report certain events that are relevant to investors.
Why do companies file 8-K?
There are many reasons a company would file an 8-K, making it one of the required forms most commonly submitted to the SEC. These material events could be anything from changes in corporate management to acquisitions to an updated fiscal year end date.
What is an 8-K filing?
An 8-K is sometimes called a "current report" as it provides a snapshot of a material event and must be filed with the SEC within four business days of the event. (Compare that to a 10-K, which often is released months after the end of the fiscal year.) What to look for in 8-K filings. Here are most of the main material events ...
Why is a write down not included in an 8-K?
A material impairment, or writedown, doesn't always make it to an 8-K because companies can include it in their periodic reports. Writedowns reported via an 8-K usually occur when a single event significantly lowers the estimated value of certain company asset immediately. Unregistered Sales of Equity Securities.
What is 8-K disclosure?
The 8-K will disclose the action being taken, but investors might need to dig deeper to determine if the company's common stock is being canceled in the process. This includes the completion of a merger, one company buying another, or a company disposing of a significant amount of assets through a deal similar to a merger.
When do you file an 8-K?
A company must also file an 8-K when terminating this kind of agreement, as well as when events happen (such as loan defaults) that speed up or increase a financial obligation. Bankruptcy filings under Chapter 11 (reorganization) or Chapter 7 (liquidation) must be reported via an 8-K.
Do publicly traded companies have to file 8-K?
Publicly traded companies must file an 8-K in the event of any material event (other than those that occur regularly, such as earnings) that would be important to investors. Image source: Getty Images.
What is an 8-K?
What is Form 8-K? Form 8-K is one of the most common forms filed with the Securities and Exchange Commission (SEC) Securities and Exchange Commission (SEC) The US Securities and Exchange Commission, or SEC, is an independent agency of the US federal government that is responsible for implementing federal securities laws ...
What is Form 8-K?
Form 8-K is typically used as a form of notification for major events, such as a company filing for bankruptcy. Bankruptcy Bankruptcy is the legal status of a human or a non-human entity (a firm or a government agency) that is unable to repay its outstanding debts.
What is the purpose of the Securities Exchange Act?
It is also in charge of maintaining the securities industry and stock and options exchanges. to broadly notify investors about important events or information that may affect shareholders. According to the Securities Exchange Act of 1943, all public (publicly-traded) companies must submit the form when appropriate.
Why is Form 8-K important?
This is important for investors because it must include pertinent information about the company’s stock and when it plans to come out from under bankruptcy, if at all. In the event that a company is being delisted from an exchange, a Form 8-K is required as a means of notification to investors.
Is a 10-Q a quarterly report?
Form 10-Q Form 10-Q is a report – required by the Securities and Exchange Commission (SEC) – that must be filed quarterly by all public companies. The form is similar to Form 10-K; however, it typically contains fewer details and the financial statements included are typically ...
Is it important to read 8-K?
As an investor, it is important to read through any Form 8-K filed by companies you’ve invested in, or may be considering making an investment in. Information contained in the form may substantially impact your investment decisions.
Do I need to file an 8K?
Most companies err on the side of caution, and may sometimes file an 8-K form for events that wouldn’t necessarily require it. In some situations, the need to make an 8- K filing is unquestionable. As previously mentioned, a company forced into bankruptcy definitely must submit an 8-K to inform investors of the situation.
What is an 8-K?
Many companies announce their quarterly and annual results simultaneously in a press release and an 8-K (which includes the press release as an exhibit). The documents often include an announcement that the company will hold a conference call (sometimes called an analyst or earnings call) shortly after the release to discuss the results. The financial disclosures in the 8-K typically summarize the full financial statements, which will appear later in the company’s quarterly report (on Form 10-Q) or annual report (on Form 10-K).
What is Form 8-K?
Form 8-K provides investors with current information to enable them to make informed decisions. The types of information required to be disclosed on Form 8-K are generally considered to be “material.”. That means that, in general, there is a substantial likelihood that a reasonable investor would consider the information important in making an ...
What is a default in an 8-K?
Defaults on loans or other events that trigger the acceleration or increase of a financial obligation must be disclosed in an 8-K if the consequences of the event are material to the company. For example, if a company defaults on a loan, its creditors typically have the right to demand immediate payment of the entire amount owed. In such a case, if immediate repayment would be material, the company must disclose the amount to be repaid, the repayment terms and other financial obligations that might have to be repaid on an accelerated basis as a result of the initial default. Cross-default provisions may allow other creditors to demand immediate repayment of amounts owed to them.
What happens when a high level executive officer retires?
If a high-level executive officer—such as the chief executive officer, president, chief financial officer, chief accounting officer or chief operating officer—retires, resigns or is terminated, the company must disclose that fact.
What happens if a stock exchange notifies a company that it no longer satisfies the requirements
If a stock exchange notifies a company that it no longer satisfies the requirements for continued listing, this must be disclosed. For example, the stock may have been trading below the minimum price requirement for a certain period of time. The company may have a grace period to return to compliance, and will have to disclose any steps it intends to take to avoid delisting.
What happens to a company's 8-Ks?
If a company becomes the subject of a bankruptcy or receivership court filing, that must be disclosed. Future 8-Ks may outline the company’s plan for reorganization (under Chapter 11) or liquidation (under Chapter 7) and the court’s confirmation of the plan. Investors should look at the reorganization plan for information about whether the company’s common stock is likely to be canceled and when the company expects to emerge from bankruptcy.
When do companies have to file 8-K?
Companies typically provide a number of 8-Ks throughout the year, whenever significant corporate events take place that trigger a disclosure. Companies must file 8-Ks promptly, rather than waiting until their next periodic report, such as the quarterly report (on Form 10-Q) or annual report (on Form 10-K ). Companies are required ...
What is 8-K form?
Form 8-K is used to update investors and the SEC about a significant event affecting a company. The stock price of the company is often affected by 8-K triggering events, but whether the price goes up or down depends on whether the form contains good or bad news.
What is the form 8-K filed with?
Other SEC Filing Types. Form 8-K isn't the only form that companies commonly file with the SEC. Most companies file regular annual reports, using SEC Form 10-K, and quarterly reports, using SEC Form 10-Q. These regular reports come out on a set schedule and contain information about the business and the company's financials including assets, ...
What happens if you file an 8-K?
If something important happens to a publicly traded company, it's normally required to file Form 8-K to notify the public and the Securities and Exchange Commission about the event. There are a wide variety of events that can trigger the need for an 8-K filing, and they often affect the price ...
What news is disclosed in Form 8-K?
News reported in a Form 8-K filing may also be disclosed elsewhere, such as a corporate merger reported in the media or a bankruptcy made known through a bankruptcy court filing.
What happens if a company doesn't file an 8-K?
Failure to File Form 8-K. If a company is required to file a Form 8-K after an event and it doesn't do so, it can face penalties from the SEC. These can be monetary penalties or even the delisting of the company's stock. As a result, many companies err on the side of caution when it comes to filing Form 8-K.
Is an 8K filing a change in board seats?
While not every 8-K filing announcing a change in board seats or other mundane business will necessarily be of interest, it's still worth keeping an eye out for any 8-K filings in case they are relevant to your valuation of the company's stock. You can also watch the financial news for reports of significant news about a company, ...
What is an 8-K?
Many companies announce their quarterly and annual results simultaneously in a press release and an 8-K (which includes the press release as an exhibit). The documents often include an announcement that the company will hold a conference call (sometimes called an analyst or earnings call) shortly after the release to discuss the results. The financial disclosures in the 8-K typically summarize the full financial statements, which will appear later in the company’s quarterly report (on Form 10-Q) or annual report (on Form 10-K).
What is 8-K disclosure?
The types of information required to be disclosed on Form 8-K are generally considered to be “material.”. That means that, in general, there is a substantial likelihood that a reasonable investor would consider the information important in making an investment decision. Companies typically provide a number of 8-Ks throughout the year, ...
What is a default in an 8-K?
Defaults on loans or other events that trigger the acceleration or increase of a financial obligation must be disclosed in an 8-K if the consequences of the event are material to the company. For example, if a company defaults on a loan, its creditors typically have the right to demand immediate payment of the entire amount owed. In such a case, if immediate repayment would be material, the company must disclose the amount to be repaid, the repayment terms and other financial obligations that might have to be repaid on an accelerated basis as a result of the initial default. Cross-default provisions may allow other creditors to demand immediate repayment of amounts owed to them.
What happens if a stock exchange notifies a company that it no longer satisfies the requirements
If a stock exchange notifies a company that it no longer satisfies the requirements for continued listing, this must be disclosed. For example, the stock may have been trading below the minimum price requirement for a certain period of time. The company may have a grace period to return to compliance, and will have to disclose any steps it intends to take to avoid delisting.
How long do you have to file 8K?
Companies are required to make most 8-K disclosures within four business days of the triggering event and in some cases even earlier. The public can find 8-Ks on the SEC’s EDGAR website.
What happens to a company's 8-Ks?
If a company becomes the subject of a bankruptcy or receivership court filing, that must be disclosed. Future 8-Ks may outline the company’s plan for reorganization (under Chapter 11) or liquidation (under Chapter 7) and the court’s confirmation of the plan. Investors should look at the reorganization plan for information about whether the company’s common stock is likely to be canceled and when the company expects to emerge from bankruptcy.
Do you have to disclose impairments in an 8-K?
A company must disclose certain material write-downs (also called impairments) in an 8-K. (If the company determines the impairment when routinely preparing its financial statements for its periodic report, the company may make the disclosure in the periodic report rather than in an 8-K.)
What is Form 8-K 1.01?
Item 1.01 of Form 8-K requires disclosure when a registrant enters into a “material definitive agreement” outside of the ordinary course of business. In the context of an acquisition, this in most cases would potentially be triggered by the execution of the definitive acquisition agreement (rather than a letter of intent or term sheet).
What is item 2.01 of Form 8-K?
Item 2.01 of Form 8-K provides that, when a registrant has completed the acquisition of a significant amount of assets , other than in the ordinary course of business, the registrant will be required to file a Form 8-K and disclose certain information regarding the acquisition within four business days following the completion of the acquisition. Unlike Item 1.01, the determination of whether the completion of an acquisition triggers Item 2.01 is based on bright-line quantitative tests.
Understanding Form 8-K
- An 8-K is required to announce significant events relevant to shareholders. Companies usually have four business days to file an 8-K for most specified items.2 Documents fulfilling Regulation Fair Disclosure (Reg FD) requirements may be due before four business days have passed. An o…
Benefits of Form 8-K
- First and foremost, Form 8-K provides investors with timely notification of significant changes at listed companies. Many of these changes are defined explicitly by the SEC. In contrast, others are simply events that firms consider to be sufficiently noteworthy. In any case, the form provides a way for firms to communicate directly with investors. The information provided is not filtered or …
Criticism of Form 8-K
- Like any legally required paperwork, Form 8-K imposes costs on businesses. There is the cost of preparing and submitting the forms, as well as possible penalties for failing to file on time. Although it is only one small part of the problem, the need to file Form 8-K also deters small companies from going public in the first place. Requiring companies to provide information help…
Requirements For Form 8-K
- The SEC requires disclosure for numerous changes relating to a registrant's business and operations. Changes to a material definitive agreement or the bankruptcy of an entity must be reported. Other financial information disclosure requirements include the completion of an acquisition, changes in the firm's financial condition, disposal activities, and substantial impairm…
M 1.01 – Entry Into A Material Definitive Agreement
M 1.02 – Termination of A Material Definitive Agreement
- Reading a Form 8-K for information depends a lot on the reason for which a company files the form. There are, again, a number of reasons why a company must file the form. To get a better understanding of how reading an 8-K form can be helpful to investors, consider the following: 1. In the event that a company files for bankruptcy, the Form 8-K sho...
3 – Bankruptcy Or Receivership
1 – Completion of Acquisition Or Disposition of Assets
M 2.02 – Results of Operations and Financial Condition
M 2.05 – Costs Associated with Exit Or Disposal Activities
M 2.06 – Material Impairments
- If a company acquires or disposes of a significant amount of assets, the company must file an 8-K to describe the terms of the transaction. Examples include buying or merging with another company, or selling a business unit. A company that is no longer a “shell company” as a result of a merger would also use this item to provide investors with comp...
M 3.02 – Unregistered Sales of Equity Securities
M 3.03 – Material Modification to Rights of Security Holders
M 4.01 – Changes in Registrant’S Certifying Accountant