7.2.2007

The SEC proposed significant reforms to rules that govern capital formation, Form D filings and reporting. The major changes include the following:

  • reduced disclosure and reporting requirements for companies with a common equity public float of less than $75 million;
  • access to “short form” registration on Forms S-3 and F-3 by the same companies for public offerings that do not exceed 20% of their public float in a one-year period;
  • expansion and revision of existing registration exemptions for private offerings under Regulation D, including a new exemption for sales with limited public advertising to specified wealthy individuals and institutions;
  • enhanced access to the Rule 144 and Rule 145 safe harbors for public resales of restricted securities, including shortened holding periods for resales of securities of reporting companies; and
  • exemptions that will reduce the circumstances under which non-reporting companies can become subject to SEC reporting requirements as a result of issuances of compensatory stock options.

The proposed amendments also would:

  • mandate the electronic filing of the information required by Form D using a new online filing system that would be accessible using the Internet and that would automatically capture and tag data items;
  • revise and update the Form D information requirements; and
  • simplify and restructure Form D.

Please click http://www.sec.gov/rules/proposed/2007/33-8814.pdf for a copy of the release proposing the amendments to the rules.