Securities Law Advisory: SEC Expands Eligibility for Use of Forms S-3 and F-3

more+
less-

New rules permit use of Forms S-3 and F-3 for primary offerings by issuers with less than $75 million in public float, subject to the limitation that no more than one-third of public float in 12 months may be issued in such offerings.

In an effort to enable more domestic issuers and foreign private issuers to conduct primary securities offerings using Forms S-3 and F-3, respectively, and thereby facilitate the capitalraising activities of smaller public companies, the Securities and Exchange Commission (SEC) has recently expanded the eligibility conditions for the use of Forms S-3 and F-3 to register primary offerings. Prior to the SEC’s amendments, companies were able to register primary offerings of their securities on Forms S-3 and F-3 only if the value of their equity held by non-affiliates, or “public float,” was $75 million or more (calculated within 60 days prior to the date on which the registration statement or a post-effective amendment to the registration statement, such as an annual report on Form 10-K or 20-F, was filed). The revisions that have been adopted by the SEC now allow companies with less than $75 million in public float to register primary offerings of their securities on Forms S-3 and F-3, provided that certain other conditions are met, including that such issuers do not sell securities valued in excess of one-third of their public float in primary offerings using Forms S-3 or F-3 over any period of 12 calendar months.

In the Adopting Release for these rules, the SEC noted that “[t]hese amendments are intended to allow a larger number of public companies to benefit from the greater flexibility and efficiency in accessing the public securities markets afforded by Form S-3 and Form F-3 in a manner that is consistent with investor protection.”1 The “greater flexibility and efficiency” referred to by the SEC stems from the following factors:

SEE FULL ADVISORY FOR MORE INFORMATION.

LOADING PDF: If there are any problems, click here to download the file.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Mintz Levin | Attorney Advertising

Written by:

more+
less-

Mintz Levin on:

JD Supra Readers' Choice 2016 Awards
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×