SEC WANTS TO EXPAND 'TEST THE WATERS'.

Author:Barlas, Stephen
Position:SEC/
 
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The U.S. Securities & Exchange Commission (SEC) has proposed allowing a broader range of companies to engage in oral or written communications with potential investors either prior to or following the filing of a registration statement. Currently, only emerging growth companies (EGCs) are granted the freedom by the SEC to "test the waters" prior to a stock offering to a designation. A company qualifies as an EGC if it has total annual gross revenues of less than $1.07 billion during its most recently completed fiscal year and had not sold common equity securities under a registration statement as of December 8, 2011.

Business groups such as the Securities Industry and Financial Markets Association (SIFMA)...

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