On February 19, the SEC proposed to expand its “test-the waters” reform to all issuers, including investment companies. The reform, which permits investor views about offerings to be taken into account at an earlier stage than has been the case, is currently available only to “emerging growth companies,” or EGCs.
The current test-the-waters provision was first made available under the Jumpstart Our Business Startups Act, also known as the JOBS Act, but only to EGCs – generally, companies with less than $1 billion in annual revenues. The new reform will make the provisions available to all issuers, including investment companies, and is part of the SEC’s continuing effort to facilitate capital formation generally and, in particular, to encourage more companies to go public.
Further details on the expanded reform will be available shortly in The Securities Edge, our securities and governance blog. If you have any questions in the meantime, please contact Gunster securities law and corporate governance practice leader Bob Lamm.
