As we discussed in this post, the SEC has amended Regulation S-T to allow electronic signatures in many filings.  In this post, we highlighted that this rule is effective as of December 4, 2020.

To use electronic signatures, companies must take some fairly straightforward steps.  First, the rule requires an initial “authentication document” to be signed the “traditional” way (i.e., with an original signature) and retained by the company.

Thanks to SEC Institute workshop leader Gary Brown and Charles Vaughn, Partners at Nelson Mullins Riley & Scarborough, you can find an example of an initial “authentication document” at the end of this post.  They also suggest the following guidance for the second step:

The platform used for electronic signatures must:

• require the signatory to present a physical, logical, or digital credential that authenticates the signatory’s individual identity;
• reasonably provide for non-repudiation of the signature;
• provide that the signature be attached, affixed, or otherwise logically associated with the signature page or document being signed; and
• includes a timestamp to record the date and time of the signature.

DocuSign is an example of a platform that meets these requirements.

Thanks again to Gary and Charles, and your thoughts and comments are welcome. 

[NAME OF COMPANY] 

Initial Electronic Signature Authentication Document

for Documents Filed with

the United States Securities and Exchange Commission

The undersigned is either (a) a member of the board of directors of [NAME OF COMPANY], a [State] corporation (the “Company”), or (b) an officer of the Company, or both, who will or may be called upon to sign, either on behalf of the Company or individually, documents that will be filed with the United States Securities and Exchange Commission (the “SEC”).  The undersigned is signing this Initial Electronic Signature Authentication (this “Authentication”) pursuant to rules adopted by the SEC to permit documents filed with the SEC to be signed via DocuSign or another similar electronic platform.

Background

Rule 302(b)(2) of SEC Regulation S-T requires that before an officer or director (a “signatory”) initially uses an electronic signature to sign a signature page or other document to be filed with the SEC, the signatory must manually sign a document (an “authentication document”) attesting that the signatory agrees that the use of an electronic signature in any authentication document constitutes the legal equivalent of such individual’s manual signature for purposes of authenticating the signature to any filing for which it is provided.  An electronic filer like the Company must (a) retain this manually signed document for as long as the signatory may use an electronic signature to sign an authentication document and for a minimum period of seven years after the date of the most recent electronically signed authentication document; and (b) furnish a copy of it upon request to the SEC or its staff.

Attestation and Agreement

In light of the foregoing, I hereby attest, acknowledge and agree that the use of my electronic signature in any authentication document constitutes the legal equivalent of my manual signature for purposes of authenticating the signature to any SEC filing for which it is provided.  I acknowledge that the Company will (a) retain this Authentication for as long as I may use an electronic signature to sign an authentication document and for a minimum period of seven years after the date of the most recent electronically signed authentication document; and (b) furnish a copy of this Authentication upon request to the SEC or its staff.

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