Is Today A Business Day? – Corporate/Commercial Law

Is today a Business Day? Good question, depends who you
ask.

The SEC’s EDGAR filing system is closed today for the
Juneteenth Holiday.  Because today is a federal holiday, today
will not count as a business day in the filing periods in Rule
424(b) under the Securities Act.  This is also helpfully noted
in the SEC’s announcement of an EDGAR filing holiday at: 
SEC.gov | EDGAR Will Be Closed Friday, June 18,
2021.

What about the time period between pricing and settlement of a
debt security, such as a structured note issued off of a
medium-term note program?  This is usually 2-3 “business
days,” as defined in the relevant indenture.  A typical
“business day” definition for a fixed rate debt security
in an indenture reads “‘business day’ means any day,
other than a Saturday or Sunday, that is neither a legal holiday
nor a day on which banking institutions are authorized or required
by law or regulation to close in the City of New York.” 
Because today is a legal holiday, it will not be counted for
purposes of the settlement period.  We don’t have to reach
the question of whether or not banks in New York City are open, as
many banks are open today.

Issuers and underwriters closing a transaction pursuant to an
underwriting agreement may not have an extra day.  At least
one bulge bracket bank holding company’s form of underwriting
agreement defines a “New York Business Day,” which is
used for settlement of the transaction, as “each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York City are generally authorized or
obligated by law or executive order to close.”  Because
today is not a bank holiday in New York City, today is a New York
Business Day under that formulation.  We can assume that the
drafters of that agreement thought that there would be sufficient
advance notice of any federal or bank holiday.  There was very
little advance notice of this federal holiday.

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