10b-5 Letters


This practice note provides an overview of the 10b-5 letter and focuses on common carveouts from and qualifications to 10b-5 letters, particularly the carveouts for financial and statistical information. The underwriting agreement for a public offering of securities, or its equivalent for a private offering, usually requires counsel to provide certain assurances to the underwriters regarding the disclosure in the offering document. Attorneys for the issuer and for the underwriters provide such assurances in their respective 10b-5 letters. The 10b-5 letter, also known as a negative assurance letter, is delivered solely to underwriters (or other financial intermediaries) as a closing condition in securities offerings. Sometimes the 10b-5 letter is also referred to as the 10b-5 opinion, although this is a misnomer as it represents a statement of fact. This practice note provides practical guidance for counsel negotiating 10b-5 letters and negative assurance language that may be used.