On March 19, 2026, the SEC’s Division of Corporation Finance issued new Corporation Finance Interpretation 116.26, providing guidance for issuers conducting at-the-market offerings (ATMs) under Form S-3. The interpretation addresses the scenario where a company launches an ATM while eligible to conduct a primary offering on Form S-3, but at the time of its next Securities Act Section 10(a)(3) update its public float has fallen below the $75 million requirement under General Instruction I.B.1 to Form S-3. The company remains eligible to rely on the “baby shelf” rule under General Instruction I.B.6 to Form S-3.

The staff confirmed that, in these circumstances and where the company entered into an agreement with a named selling agent for an amount the company reasonably expects to sell, it will not object if the company continues to offer and sell the full amount of securities under the ATM covered by the prospectus supplement filed before the Section 10(a)(3) update, even if that amount would exceed the cap imposed by the “baby shelf” rule. In effect, companies need not cease or curtail offerings under an existing ATM as a result of a change in circumstances due to later fluctuations in stock price.

For public companies, this guidance reduces uncertainty around ATM execution and capital planning. Without it, an issuer may have needed to suspend or restructure an ongoing program midstream, making this interpretation a welcome source of certainty and flexibility in a fluctuating market environment.