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SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 210, 229, 230, 232, 239, 240, and 249

[Release Nos. 33-11418; 34-105513; IC-36160; File No. S7-2026-17]

RIN 3235-AN41

Registered Offering Reform

AGENCY: Securities and Exchange Commission.

ACTION: Proposed rule.

SUMMARY: The Securities and Exchange Commission (“Commission”) is proposing

amendments that are intended to facilitate capital formation in the public securities markets.

Specifically, the proposed amendments would make Form S-3 and the ability to conduct shelf

offerings available to significantly more issuers, extend certain benefits currently reserved for

“well-known seasoned issuers” to a broader set of issuers, and modernize Form S-1 by

expanding the ability to incorporate information by reference into that form. The proposed

amendments also would make conforming changes to the registration, communication, and

offering process for certain business development companies and registered closed-end

investment companies that register securities on Form N-2. We also are proposing to amend the

communication rules to permit broad-based advertising for certain insurance products. In

addition, we are proposing certain other amendments that are intended to modernize certain

rules. Finally, to mitigate the costs and complexity of conducting a registered offering, the

proposed amendments would preempt State securities law registration and qualification

requirements for all registered offerings.

DATES: Comments should be received on or before July 27, 2026.

ADDRESSES: Comments may be submitted by any of the following methods:

Electronic Comments:

•

Use the Commission’s internet comment form (https://www.sec.gov/comments/s7-202617/registered-offering-reform).

•

Send an email to rule-comments@sec.gov. Please include File Number S7-2026-17 on

the subject line.

Paper Comments:

•

Send paper comments to Vanessa A. Countryman, Secretary, Securities and Exchange

Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number S7-2026-17. This file number should be

included on the subject line if email is used. To help the Commission process and review your

comments more efficiently, please use only one method of submission. The Commission will

post all submitted comments on the Commission’s website (https://www.sec.gov/rules

regulations/public-comments/s7-2026-17). Do not include personally identifiable information in

submissions; you should submit only information that you wish to make available publicly. The

Commission may redact in part or withhold entirely from publication submitted material that is

obscene or subject to copyright protection.

Studies, memoranda, or other substantive items may be added by the Commission or staff

to the comment file during this rulemaking. A notification of the inclusion in the comment file of

any such materials will be made available on the Commission’s website. To ensure direct

electronic receipt of such notifications, sign up through the “Stay Connected” option at

www.sec.gov to receive notifications by email.

A summary of the proposal of not more than 100 words is posted on the Commission’s

website (https://www.sec.gov/rules-regulations/2026/05/S7-2026-17).

FOR FURTHER INFORMATION CONTACT: Mark W. Green, Senior Special Counsel, or

Isabel Rivera, Special Counsel, Office of Rulemaking, Division of Corporation Finance, at (202)

551-3430, Matt McNair, Senior Adviser to the Chief Counsel, Office of Chief Counsel, Division

of Corporation Finance, at (202) 551-3500, Pamela Ellis, Senior Counsel; Blair Burnett, Bradley

Gude, Branch Chiefs; or Brian McLaughlin Johnson, Assistant Director, at (202) 551-6792,

Investment Company Regulation Office, Division of Investment Management; U.S. Securities

and Exchange Commission, 100 F Street NE, Washington, DC 20549.

SUPPLEMENTARY INFORMATION: We are proposing to amend the following rules and

forms:

Commission Reference

Regulation S-X

Regulation S-K

Regulation M-A

Regulation AB

Regulation S-T

Securities Act of 1933

(“Securities Act”) 1

Rule 3-01 of Regulation S-X

Rule 8-08 of Regulation S-X

Item 305 of Regulation S-K

Item 1004 of Regulation M-A

Item 1100 of Regulation AB

Rule 101 of Regulation S-T

Rule 201 of Regulation S-T

Rule 202 of Regulation S-T

Rule 137

Rule 138

Rule 139

Rule 139b

Rule 146

Rule 163

Rule 163A

Rule 164

Rule 401

Rule 405

Rule 406

Rule 413

Rule 415

Rule 424

Rule 430B

15 U.S.C. 77a et seq.

CFR Citation

(17 CFR)

§ 210.3-01

§ 210.8-08

§ 229.305

§ 229.1004

§ 229.1100

§ 232.101

§ 232.201

§ 232.202

§ 230.137

§ 230.138

§ 230.139

§ 230.139b

§ 230.146

§ 230.163

§ 230.163A

§ 230.164

§ 230.401

§ 230.405

§ 230.406

§ 230.413

§ 230.415

§ 230.424

§ 230.430B

Securities Exchange Act

of 1934 (“Exchange

Act”) 2

Securities Act and

Investment Company Act

of 1940 (“Investment

Company Act”) 3

15 U.S.C. 78a et seq.

15 U.S.C. 80a et seq.

Rule 433

Rule 456

Rule 457

Rule 462

Rule 464

Rule 473

Rule 479

Rule 482

Rule 497

Form S-1

Form S-3

Form S-8

Form S-11

Form S-4

Form F-3

Form F-4

Form 20-F

Form 10-K

Schedule 14A

Rule 15c2-8

Form N-2

§ 230.433

§ 230.456

§ 230.457

§ 230.462

§ 230.464

§ 230.473

§ 230.479

§ 230.482

§ 230.497

§ 239.11

§ 239.13

§ 239.16b

§ 239.18

§ 239.25

§ 239.33

§ 239.34

§ 249.220f

§ 249.310

§ 240.14a-101

§ 240.15c2-8

§ 239.14 and § 274.11a-1

TABLE OF CONTENTS

I. INTRODUCTION .................................................................................................................... 8

A. Overview of the Proposed Amendments .......................................................................... 11

B. Eliminating Public Float Requirements and Other Indicia of Market Following ............. 15

II. DISCUSSION OF PROPOSED AMENDMENTS ................................................................ 22

A. Form S-3 ........................................................................................................................... 22

Background................................................................................................................ 22

Proposed Amendments .............................................................................................. 45

B. The Enhanced Registration and Communication Benefits ............................................. 109

Background.............................................................................................................. 109

Proposed Amendments ............................................................................................ 113

C. Form S-1 ......................................................................................................................... 134

Background.............................................................................................................. 135

Proposed Amendments ............................................................................................ 140

D. Business Development Companies and Closed-End Funds ........................................... 152

Background.............................................................................................................. 154

Proposed Amendments ............................................................................................ 158

E. Registered Non-Variable Annuity Advertising .............................................................. 167

Background.............................................................................................................. 167

Proposed Amendments ............................................................................................ 171

F. Preemption of State Securities Law Registration and Qualification .............................. 180

Background.............................................................................................................. 181

Proposed Amendments ............................................................................................ 184

G. Other Rule Amendments ................................................................................................. 189

Delaying Amendments ............................................................................................ 189

Elimination of Certain Conditions Relating to Age of Financial Statements ......... 191

Conforming and Technical Amendments ................................................................ 196

III. OTHER MATTERS.............................................................................................................. 203

IV. ECONOMIC ANALYSIS .................................................................................................... 203

A. Overview ......................................................................................................................... 203

B. Baseline ........................................................................................................................... 205

Form S-1 and Form S-3 Issuers ............................................................................... 206

Form N-2 and Insurance Company Issuers ............................................................. 227

C. Benefits and Costs........................................................................................................... 234

Benefits and Costs of Proposed Amendments to Form S-3 Eligibility ................... 235

Benefits and Costs of Amendments to Eligibility for the Enhanced Registration and

Communication Benefits ......................................................................................... 248

Benefits and Costs of Amendments to Incorporation by Reference in Form S-1 ... 259

Benefits and Costs of Amendments to Preempt State Regulation and Qualification

................................................................................................................................. 260

Business Development Companies, Closed-End Funds, and Registered Non-Variable

Annuity Advertising ................................................................................................ 263

Benefits and Costs of Proposed Amendments to Rule 473 and Regulation S-X .... 267

Other Commission Proposals .................................................................................. 270

Aggregate Monetized Benefits and Costs ............................................................... 275

D. Effects on Efficiency, Capital Formation, and Competition........................................... 286

Effects on Efficiency ............................................................................................... 286

Effects on Capital Formation................................................................................... 288

Effects on Competition ............................................................................................ 290

E. Reasonable Alternatives.................................................................................................. 291

Retain and Modify the Public Float-Based Conditions for Form S-3 Eligibility and

WKSI Status ............................................................................................................ 291

2. Retain WKSI Definition and Use an Alternative Measure of Whether an Issuer is

“Well-Known” ......................................................................................................... 292

F. Request for Comment ..................................................................................................... 293

V. PAPERWORK REDUCTION ACT ..................................................................................... 295

A. Summary of the Collections of Information ................................................................... 295

B. Summary of the Proposed Amendments’ Estimated Effects on the Collections of

Information ..................................................................................................................... 296

C. Incremental and Aggregate Burden and Cost Estimates................................................. 302

D. Request for Comment ..................................................................................................... 306

VI. CONGRESSIONAL REVIEW ACT .................................................................................... 307

VII. INITIAL REGULATORY FLEXIBILITY ACT ANALYSIS AND REGULATORY

FLEXIBILITY ACT CERTIFICATION .............................................................................. 308

A. Initial Regulatory Flexibility Act Analysis ...................................................................... 308

Reasons for, and Objectives of, the Proposed Action ............................................. 308

Legal Basis .............................................................................................................. 309

Small Entities Subject to the Proposed Amendments ............................................. 309

Projected Reporting, Recordkeeping, and Other Compliance Requirements ......... 310

Duplicate, Overlapping, or Conflicting Federal Rules ............................................ 311

Significant Alternatives ........................................................................................... 311

B. Request for Comment ..................................................................................................... 312

C. Certification Relating to Issuers of Registered Non-Variable Annuities........................ 312

STATUTORY AUTHORITY .................................................................................................... 313

INTRODUCTION

We are proposing amendments that are intended to facilitate capital formation in the

public securities markets. To achieve that goal, the proposed amendments would amend certain

of our Securities Act rules and forms to provide issuers with greater flexibility to determine the

timing and structure of their registered offerings and reduce the costs of conducting a registered

offering by, among other things, simplifying and modernizing the applicable rules and forms. 4

The Commission’s longstanding, three-part mission is to protect investors, maintain fair,

orderly, and efficient markets, and facilitate capital formation. Over the years, the Commission

has engaged in various rulemakings with the express goal of facilitating capital formation. 5 Some

of those rulemakings focused specifically on facilitating capital formation with respect to

registered offerings. 6 As the Commission has recognized, the public capital markets offer several

For purposes of this release, we use the terms “registered” or “public” offerings or markets interchangeably, the

terms “exempt” or “private” offerings or markets interchangeably, and the terms “public companies,”

“companies,” “registrants,” and “issuers” interchangeably. Unless explained in the text, the use of different

terms in different places is not meant to connote a significant difference.

See, e.g., Facilitating Capital Formation and Expanding Investment Opportunities by Improving Access to

Capital in Private Markets, Release No. 33-10884 (Nov. 2, 2020) [86 FR 3496, 3551 (Jan. 14, 2021)]

(“Harmonization Adopting Release”) (“[T]he amendments simplify, harmonize, and improve certain aspects of

the exempt offering framework to promote capital formation.”); Exemptions to Facilitate Intrastate and

Regional Securities Offerings, Release No. 33-10238 (Oct. 26, 2016) [81 FR 83494, 83494 (Nov. 21, 2016)]

(“The amendments . . . are designed to facilitate capital formation.”); Revisions to the Eligibility Requirements

for Primary Securities Offerings on Forms S-3 and F-3, Release No. 33-8878 (“Baby Shelf Adopting Release”)

(Dec. 19, 2007) [72 FR 73534, 73548 (Dec. 27, 2007)] (“We therefore believe that extending shelf registration

benefits to more companies in the manner that we have chosen will facilitate the capital-raising efforts of

smaller public companies who currently have fewer financing options than their larger counterparts.”);

Securities Offering Reform, Release No. 33-8591 (July 19, 2005) [70 FR 44721, 44796 (Aug. 3, 2005)]

(“Securities Offering Reform Adopting Release”) (stating the Commission’s belief that the rules will “make the

capital formation process more efficient”).

See, e.g., Securities Offering Reform for Closed-End Investment Companies, Release No. 33-10771 (Apr. 8,

2020) [85 FR 33290, 33321 (June 1, 2020)] (“CEF Offering Reform Adopting Release”) (“The rule is designed

to reduce regulatory impediments to capital formation and provide more flexibility to these funds to conduct

registered securities offerings.”); Baby Shelf Adopting Release at 73534 (“The amendments are intended to

allow more companies to benefit from the greater flexibility and efficiency in accessing the public securities

markets afforded by Form S-3 and Form F-3 without compromising investor protection.”); Securities Offering

Reform Adopting Release at 44794 (“Providing flexibility for registered offerings may encourage issuers to

benefits to issuers and investors alike. 7 For example, the Commission has noted that issuers can

raise capital through the public markets on more favorable terms as compared to the private

markets. 8 This is due, in large part, to the “substantial pricing discounts that private investors

often demand to compensate them for the relative illiquidity of the restricted shares they are

purchasing” in exempt offerings. 9 Both issuers and their investors benefit from this characteristic

of the public markets because investors “may be less subject to the risk of dilution in the value of

their shares if the companies in which they invest are able to meet more of their capital needs in

the public markets.” 10

Investors in registered offerings also enjoy additional benefits and protections. As

compared to exempt offerings, issuers conducting registered offerings are required to provide

raise capital through the registration process instead of through private placements.”); Asset-Backed Securities,

Release No. 33-8518 (Dec. 22, 2004) [70 FR 1506, 1591 (Jan. 7, 2005)] (“[W]e anticipate that these rules will

enhance capital formation by simplifying the process of registering an offering of asset-backed securities.”).

See, e.g., Solicitations of Interest Prior to a Registered Public Offering, Release No. 33-10699 (Sept. 25, 2019)

[84 FR 53011, 53028 (Oct. 4, 2019)] (“[I]f the final rule encourages additional issuers to conduct a registered

securities offering, issuers may benefit from greater secondary market liquidity associated with registered

securities, compared to exempt securities, to the extent that greater liquidity makes the issuers’ securities

potentially more attractive to prospective investors. Any additional issuers that elect to conduct a registered

offering in part as a result of the final rule also may benefit from the greater ease of raising follow-on financing

through future registered offerings.”); Baby Shelf Adopting Release at 73548 (“Consequently, we anticipate

that the amendments will result in smaller issuers raising more capital through the public markets rather than

through exempt offerings conducted in the domestic and offshore markets. Investors in these companies will

benefit by such companies’ improved access to capital on more favorable terms.”); Securities Offering Reform

Adopting Release at 44794 (“Typically, registered securities enjoy more liquid markets than unregistered

securities. Therefore, registered securities are less likely to be subject to a liquidity discount. In addition,

registered securities offerings provide a potentially larger investor base than that available to those who

participate in private placements.”).

See, e.g., Baby Shelf Adopting Release at 73548 (“We believe that extending shelf registration benefits to more

companies, in the manner we have chosen, will facilitate the capital-raising efforts of smaller public companies

who currently have fewer financing options than their larger counterparts. . . . By selling into the public

markets, these companies may be able to avoid the substantial pricing discounts that private investors often

demand to compensate them for the relative illiquidity of the restricted shares they are purchasing.”); Securities

Offering Reform Adopting Release at 44794 (“[R]egistered securities offerings provide a potentially larger

investor base than that available to those who participate in private placements. Accordingly, issuers may incur

lower transaction costs when raising capital because they will have access to a much deeper market for their

securities and may have to expend fewer resources to locate investors.”).

Baby Shelf Adopting Release at 73548.

Id.

their investors with more robust disclosures, and those disclosures are subject to enhanced

liability standards. 11 Although these requirements may increase compliance costs and litigation

risks for issuers, those issuers ultimately may benefit from a lower cost of capital due, in part, to

investors’ reduced risk perception with respect to registered offerings. 12

When pursuing the goal of facilitating capital formation, the Commission also has sought

to ensure investors remain appropriately protected. 13 To the extent there is a trade-off between

efforts to facilitate capital formation and protect investors, the Commission has calibrated its

rules with an eye towards balancing those two goals.

This proposal is intended to achieve the benefits associated with increased capital

formation in the public securities markets. At the same time, we are committed to ensuring that

investors remain appropriately protected. We recognize, however, that several aspects of our

current Securities Act rules and forms, while intended to help protect investors at the time they

were adopted, may now have the unintended effect of unduly inhibiting capital formation in

today’s markets. We believe, therefore, that it is appropriate to recalibrate certain of our rules

Harmonization Adopting Release at 3562 (noting certain “investor protections associated with registered

offerings” that are not associated with exempt offerings, such as “gun jumping provisions of the Securities Act .

. . staff review, Section 11 liability, disclosure requirements in the registration statement, and Exchange Act

reporting requirements”).

See, e.g., Accelerated Filer and Large Accelerated Filer Definitions, Release No. 34-88365 (Mar. 12, 2020) [85

FR 17178, 17215 (Mar. 26, 2020)] (“2020 Accelerated Filer Adopting Release”) (“[A]t the issuer level, more

reliable disclosures are generally expected, based on economic theory, to lead investors to demand a lower

expected return to hold an issuer’s securities (i.e., a lower cost of capital).”).

See, e.g., Harmonization Adopting Release at 3498 (“We are amending the exempt offering framework to close

gaps and reduce complexities that may impede access to capital for issuers and thereby limit investment

opportunities, while preserving or enhancing important investor protections.”); Baby Shelf Adopting Release at

73534 (“These 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.”); Securities Offering Reform Adopting Release at

44761 (“The amendments we are adopting today are designed to ensure that appropriate investor protections are

maintained.”); Shelf Registration, Release No. 33-6499 (Nov. 17, 1983) [48 FR 52889, 52890 (Nov. 23, 1983)]

(“Shelf Registration Adopting Release”) (“The Commission believes that limiting the Rule to primary offerings

of securities qualified to be registered on Form S-3 or F-3 and to traditional shelf offerings strikes the

appropriate balance.”).

and forms to ensure that they do not unduly restrict issuers’ abilities to raise capital in a timely,

efficient manner via a registered offering.

A. Overview of the Proposed Amendments

As discussed in more detail in section II below, the proposed amendments can be

separated into several categories. First, we are proposing to revise Form S-3’s eligibility

requirements to allow a broader range of issuers to conduct offerings using the form, including

delayed primary offerings (which, for purposes of this release, we refer to as “shelf offerings”) 14

and at the market (“ATM”) primary offerings. Notably, the proposed amendments would

eliminate the following eligibility requirements in Form S-3:

•

The issuer must have filed all the material required to be filed pursuant to section 13, 14,

or 15(d) of the Exchange Act for a period of at least 12 calendar months immediately

preceding the filing of the registration statement (which we refer to as the “One-Year

Seasoning” requirement); and

•

The aggregate value of the issuer’s voting and non-voting common equity held by nonaffiliates (i.e., “public float”) must be $75 million or more to offer an unlimited amount

of securities on Form S-3. 15

These proposed changes would significantly expand the population of issuers eligible to offer an

unlimited amount of securities on Form S-3. Specifically, we estimate that there could be an

increase of over 60 percent in the number of issuers eligible to offer an unlimited amount of

When an issuer conducts a delayed offering under a shelf registration statement, it is commonly described as

taking securities “off the shelf.” These delayed offerings are referred to as “takedowns.”

Throughout this release, “public float” refers to the aggregate market value of the voting and non-voting

common equity held by non-affiliates.

securities on Form S-3. 16 As discussed in section II.A below, these newly eligible issuers would

benefit from the cost savings and capital raising efficiencies and flexibilities associated with the

ability to use Form S-3 and conduct shelf offerings.

Second, we are proposing to extend certain benefits currently reserved for “well-known

seasoned issuers” (“WKSIs”) and other seasoned issuers (which we refer to as the “Enhanced

Registration and Communication Benefits”) to a larger set of issuers. 17 Those benefits, which are

discussed in section II.B below, are intended to further the Commission’s longstanding goal of

“facilitat[ing] capital formation, and possibly lower[ing] the cost of capital, by improving access

to the public capital markets.” 18 Currently, in order to be a WKSI (and, in turn, qualify for all of

the Enhanced Registration and Communication Benefits), an issuer must, among other things,

either have a public float of $700 million or more or have issued at least $1 billion aggregate

principal amount of non-convertible securities, other than common equity, in primary offerings

for cash, not exchange, registered under the Securities Act. Under the proposed amendments,

issuers would not be required to meet either of these metrics in order to qualify for the Enhanced

Registration and Communication Benefits. Instead, under the proposed amendments, issuers

generally would qualify for those benefits if they are eligible to use Form S-3 and have at least

See Table 2 and the accompanying discussion in section IV.B.1.a below for the methodology used in

developing (and the assumptions underlying) this estimate.

Among other things, the Enhanced Registration and Communication Benefits include the ability to file shelf

registration statements on Form S-3 that are automatically effective upon filing with the Commission, to

exercise greater flexibility with respect to pre-filing and post-filing communications, and to pay filing fees at

the time of the takedown, rather than at the time of filing a Form S-3. See infra sections II.B.1 and II.B.2.a for a

more comprehensive discussion of the Enhanced Registration and Communication Benefits, the types of issuers

that currently qualify for each of the benefits, and the types of issuers that would qualify for each of the benefits

under the proposed amendments.

Securities Offering Reform Adopting Release at 44793.

one class of common equity securities listed on a national securities exchange. 19 Thus, as a result

of the proposed amendments, we estimate that there could be an increase of over 200 percent in

the number of issuers eligible for all of the Enhanced Registration and Communication

Benefits. 20

Third, we are proposing to revise Form S-1 to expand issuers’ abilities to incorporate by

reference information filed before (i.e., backward incorporation by reference) and after (i.e.,

forward incorporation by reference) the effective date of the registration statement. As discussed

in section II.C below, the ability to backward incorporate currently is limited to issuers that,

among other things, have filed an annual report for their most recently completed fiscal year. The

ability to forward incorporate currently is limited to issuers that, among other things, are smaller

reporting companies (“SRCs”). 21 Under the proposed amendments, issuers that meet Form S-1’s

requirements to incorporate by reference would be able to backward incorporate regardless of

whether they had filed an annual report for their most recently completed fiscal year and forward

incorporate regardless of whether they are an SRC. This would allow a greater number of issuers

A “national securities exchange” is a securities exchange that has registered with the Commission under section

6 of the Exchange Act. 15 U.S.C. 78f. In this release, we refer to issuers that have at least one class of common

equity securities listed on a national securities exchange as “exchange-listed.” To qualify for the ability to file

automatic shelf registration statements, issuers also would be required to have been subject to the Exchange

Act’s reporting requirements for a period of at least 12 calendar months.

See Table 7 and the accompanying discussion in section IV.B.1.a below for the methodology used in

developing (and the assumptions underlying) this estimate.

To be able to forward incorporate by reference, an issuer must be an SRC that meets the eligibility requirements

for incorporation by reference in General Instruction VII of Form S-1, which includes being subject to the

reporting requirements pursuant to section 13 or 15(d) of the Exchange Act, having filed all reports and other

materials required to be filed by sections 13(a), 14, or 15(d) of the Exchange Act during the preceding 12

months (or for such shorter period that the registrant was required to file such reports and materials), having

filed an annual report required under section 13(a) or 15(d) of the Exchange Act for the most recently

completed fiscal year, and not being a BSP issuer, as defined infra note 180. See infra section II.C for a

discussion of the requirements to incorporate by reference on Form S-1.

to enjoy the cost savings associated with incorporation by reference, with an estimated increase

of up to 106 percent in the number of issuers eligible to forward incorporate on Form S-1. 22

Fourth, in addition to the proposed amendments to the registration process for issuers that

communication, and offering process for certain business development companies (“BDCs”)

and registered closed-end investment companies (“registered CEFs”, collectively with BDCs,

“affected funds”) that register securities on Form N-2, broadening their access to shelf offerings

and the Enhanced Registration and Communication Benefits. These amendments would allow a

greater number of affected funds to raise capital more efficiently and would provide more

affected funds flexibility to manage the timing of their offerings in response to market

opportunities.

Fifth, we are proposing to amend Rule 482 and other related rules to permit broad-based

advertising relating to certain insurance products as discussed in more detail in section II.E

below.

Sixth, under section 18(b)(3) of the Securities Act, 23 we are proposing to define

“qualified purchaser” such that State securities law registration and qualification requirements

would be preempted with respect to any registered offering. As discussed in section II.F below,

such preemption currently applies to registered offerings in which the securities being offered

and sold are listed or approved for listing on a national securities exchange. Preemption currently

We calculated this estimated increase by comparing the number of Exchange Act reporting issuers that are

SRCs to the number of such issuers that are non-SRCs, according to the economic analysis we conducted in

another proposing release. See Enhancement of Emerging Growth Company Accommodations and

Simplification of Filer Status for Reporting Companies, Release No. 33-11419 (May 19, 2026) [91 FR 30086

(May 21, 2026)] (“Filer Status Proposal”) (noting in EA Table 2 that, as of 2024, there were 2,904 SRCs and

3,067 Exchange Act reporting companies that were non-SRCs).

15 U.S.C. 77r(b)(3).

does not, however, apply to registered offerings of unlisted securities. The proposed amendment,

therefore, would eliminate the costs associated with complying with numerous states’

registration and qualification requirements for registered offerings of unlisted securities.

Finally, we are proposing certain other amendments that are intended to modernize our

rules. We discuss those proposed amendments in section II.G below. 24

We invite and encourage interested parties to submit comments on any aspect of the

proposed amendments. When commenting, please include the reasoning in support of your

position or recommendation and provide any supporting documentation or data.

B. Eliminating Public Float Requirements and Other Indicia of Market Following

As noted in section I.A above, the proposed amendments would overhaul the criteria used

to determine whether an issuer can use Form S-3 or the Enhanced Registration and

Communication Benefits. For example, the proposed amendments would eliminate the

requirements that issuers exceed a specified public float or amount of registered debt issued

threshold to be eligible to offer an unlimited amount of securities on Form S-3 or to qualify for

all of the Enhanced Registration and Communication Benefits. The proposed amendments also

would eliminate the One-Year Seasoning requirement for Form S-3 eligibility.

These proposed amendments are intended to expand the population of issuers eligible to

use Form S-3 and the Enhanced Registration and Communication Benefits. As discussed in

section II.A.1 below, this goal is consistent with several prior Commission rulemakings. We

recognize, however, that the proposed amendments also would, in many ways, represent a

departure from the Commission’s historical approach. An issuer’s eligibility to use Form S-3

We also are proposing certain conforming and technical amendments to some of our rules and forms that are

intended to simplify them and avoid redundancy. These amendments generally are not intended to have a

substantive effect and are discussed in more detail in section II.G.3 below.

has, since the form’s inception, depended on whether the issuer satisfies the Exchange Act

seasoning and minimum public float requirements. 25 Similarly, since the Commission adopted

the Enhanced Registration and Communication Benefits, an issuer’s ability to use those benefits

has been conditioned, in part, on whether the issuer exceeds either a minimum public float or

amount of registered debt issued threshold. 26

In adopting rules and forms permitting short-form and shelf registration and the

Enhanced Registration and Communication Benefits, and in periodically reconsidering the

requirements issuers must meet to qualify for some of those benefits, the Commission has sought

to reduce issuers’ costs of raising capital while maintaining investor protection. 27 The proposed

amendments are intended to reflect the Commission’s experience since it adopted or last

amended the rules, including a reassessment of how best to protect investors in a manner that

does not unduly limit issuers’ access to short-form and shelf registration and the Enhanced

Registration and Communication Benefits.

As the Commission has previously recognized, public securities offerings provide

investors with benefits and protections not available in the private markets. The existing

eligibility requirements, including the One-Year Seasoning and public float requirements, are

intended to protect investors. Those eligibility requirements, however, also limit the number of

issuers that may utilize Form S-3 and the Enhanced Registration and Communication Benefits,

thus prompting some issuers to raise capital through other means, such as an exempt offering or

private financing, in lieu of conducting a registered offering. Because registered offerings often

See infra section II.A.1.b and c.

See infra section II.B.1.

See supra note 13.

ultimately benefit issuers and investors alike, we believe it is appropriate to expand significantly

the population of issuers eligible to use Form S-3, conduct shelf and ATM offerings, and qualify

for the Enhanced Registration and Communication Benefits so as to encourage more registered

offerings, provided that appropriate investor protections are maintained.

The proposed changes to these eligibility requirements also are intended to reflect

technological advancements and developments in the financial markets since the Commission

adopted short-form registration, shelf registration, and the Enhanced Registration and

Communication Benefits. The Commission has stated that the eligibility criteria in Form S-3 “are

based on the Commission’s belief that information about companies using the form already is

known or is so readily available that it need not be repeated in a prospectus.” 28 The Commission

historically relied on that criteria—in particular, the Exchange Act reporting history and

minimum public float requirements—as indicia of whether an issuer was widely followed and, in

turn, whether information about the issuer had been sufficiently disseminated into the

marketplace such that short-form registration was appropriate. 29 The Commission relied on a

similar rationale in conditioning the ability to use the Enhanced Registration and Communication

Benefits on an issuer’s ability to meet the specified public float or registered debt thresholds. 30

When short-form registration was first introduced in 1967, Commission filings were

submitted and available only in paper copy. The Commission attempted to facilitate broader

Reproposal of Comprehensive Revision to System for Registration of Securities Offerings, Release No. 33-6331

(Aug. 6, 1981) [46 FR 41902, 41913 (Aug. 18, 1981)] (“1981 Reproposal”).

See id. (explaining that short-form eligibility is premised “generally on dissemination of information in the

marketplace, as represented by the length and nature of compliance by the company with the reporting

requirements of the Exchange Act, and, with respect to proposed Form S-3, on the registrant’s float”).

See Securities Offering Reform Adopting Release at 44791 (“For issuers with publicly traded equity, we believe

that market capitalization provides a sufficient proxy for determining whether or not an issuer is well followed.

For issuers of fixed income securities, we believe that the amount of fixed income securities sold in registered

offerings for cash in the past three years provides a sufficient proxy.”).

distribution of this information by contracting with an outside company to create and distribute

microfiche copies to designated Commission public reference rooms, 31 but obtaining copies of

these documents was cumbersome and expensive. Notably, an individual had to either make

paper copies in the Commission’s public reference rooms or order copies from service bureaus

which, in turn, had to make and sell paper copies as requested. 32 Thus, because it was difficult

for investors to obtain information about an issuer, the Commission sought to ensure that, for

companies using short-form registration, there was “wide dissemination of information about

such companies in the market place” and that “securities analysts [would] follow companies of

this size.” 33

In the intervening years, technological developments have transformed how information

is disseminated into the marketplace and facilitated widespread access to issuer information. For

example, issuers today must make their Commission filings electronically through the

Commission’s Electronic Data Gathering, Analysis, and Retrieval system (“EDGAR”), 34 which

See Release No. 34-8345 (June 28, 1968) [not published in the Federal Register].

To review Commission filings, investors had to either physically visit one of the Commission’s public reference

rooms or subscribe to commercial data vendors for a considerable fee. See Yen-Cheng Chang, Alexander

Ljungqvist, and Kevin Tseng, Do Corporate Disclosures Constrain Strategic Analyst Behavior?, 36 REV. OF

FIN. STUD. 3614, 3169 (2023) (citing letter to Chairman Richard C. Breeden and Representative Edward J.

Markey from Patricia Glass Schuman, American Library Association et al. dated January 13, 1992, available at

http://www.bio.net/bionet/mm/ag-forst/1992-January/000187.html) (noting that pre-EDGAR one vendor

charged “a fee of $125 per month, plus a connect charge of $39 an hour, plus a charge of 2.5 cents per line of

data plus search charges which range from $6 to $51 per search” while another charged “$84 per hour plus $1

per page” and noting as an example that “obtaining Ford’s 1994 10-K from [the vendor] would have cost $145

in page charges alone”).

Short Form for the Registration of Securities, Release No. 33-5923 (Apr. 11, 1978) [43 FR 16672, 16673 (Apr.

19, 1978)] (“1978 Amendments to Short-Form Registration”).

In 1993, the Commission began mandating electronic filings on EDGAR on a phased-in basis. See Rulemaking

for EDGAR System, Release No. 33-6977 (Feb. 23, 1993) [58 FR 14628 (Mar. 18, 1993)] (“1993 EDGAR

Adopting Release”). This phase-in culminated in all corporate issuers becoming subject to electronic filing

requirements in 1996. See Rulemaking for EDGAR System, Release No. 33-7122 (Dec. 19, 1994) [59 FR 67752

(Dec. 30, 1994)].

makes these filings immediately available to the investing public without charge. 35 In addition,

corporate news is disseminated in an electronic world, and issuers today make their Commission

filings and other company information available through recognized electronic channels of

distribution, including their websites and other digital technologies. Today’s investors can access

and follow publicly filed information about an issuer for low or no cost in real time and on

demand.

Further, although Commission filings have been available to the investing public

electronically, free of charge, through EDGAR since the mid-1990s and were available to

investors in 2005 when the Commission adopted the Enhanced Registration and Communication

Benefits and in 2007 when the Commission last considered eliminating the public float

requirement in Form S-3, 36 we believe such information has become even more widely

accessible in the intervening years. Whereas only 71 percent of U.S. adults used the internet in

2007 and only 47 percent had a broadband connection at home, 37 today 96 percent use the

internet and 79 percent have a broadband connection at home. 38 In addition, today approximately

EDGAR was first introduced as a concept more than 15 years after the Commission adopted short-form

registration and more than a year after Form S-3’s adoption. See Electronic Filing, Processing and Information

Dissemination System, Release No. 33-6519 (Mar. 22, 1984) [49 FR 12707 (Mar. 30, 1984)]. Even though

EDGAR was introduced in the mid-1980s, issuers were not required to make their filings electronically on

EDGAR until the mid-1990s, which was after the Commission last revisited the “One-Year Seasoning”

requirement. The Commission, therefore, has not reassessed that requirement since EDGAR was in its infancy.

See Baby Shelf Adopting Release at 73536 (noting that “the technological advances that have revolutionized

communications between companies and the market should allow us to ease the Form S–3 eligibility standards

without undermining investor protection or the integrity of the markets” but “retaining public float as a factor in

determining the extent of short-form eligibility” because “[t]echnology can facilitate and enhance market

following, but it does not ensure it”).

John B. Horrigan & Aaron Smith, Home Broadband Adoption 2007, PEW RESEARCH CENTER (July 3, 2007),

available at https://www.pewresearch.org/internet/2007/07/03/home-broadband-adoption-2007/.

Internet, Broadband Fact Sheet, PEW RESEARCH CENTER (Nov. 13, 2024), available at

https://www.pewresearch.org/internet/fact-sheet/internet-broadband/.

91 percent of Americans own a smartphone compared to just 35 percent in 2011. 39 Thus, a

greater number of investors can retrieve investment information from nearly anywhere and

nearly anytime. Moreover, the Commission improved investor access to this information in 2019

by requiring active hyperlinks to information incorporated by reference into registration

statements and prospectuses. 40 As a result, today’s investors can now more easily and rapidly

access Commission filings on EDGAR and via issuer websites, as well as other issuer-related

information that is available through other electronic channels, at significantly lower cost than in

the past. 41

Because of the ease with which investors may obtain Exchange Act disclosure documents

and other information about an issuer, we believe that eligibility to use Form S-3 and the

Enhanced Registration and Communication Benefits should not depend on the extent of an

issuer’s market following, including analyst coverage (e.g., by reference to its public float or

initial Exchange Act seasoning). 42 Instead, we believe a more appropriate criterion is whether

Mobile Fact Sheet, PEW RESEARCH CENTER (Nov. 13, 2024), available at

https://www.pewresearch.org/internet/fact-sheet/mobile/.

See 17 CFR 230.411(d); FAST Act Modernization and Simplification of Regulation S-K, Release No. 33-10618

(Mar. 20, 2019) [84 FR 12674 (Apr. 2, 2019)] as corrected by FAST Act Modernization and Simplification of

Regulation S-K, Correction, Release No. 33-10618A (Aug. 6, 2019) [84 FR 13796 (Aug. 13, 2019)] (“FAST

Act Adopting Release”). The Commission also has made it easier for the public to access EDGAR data by, for

example, offering robust search features for EDGAR filings and making available Application Programing

Interfaces (“APIs”) and Really Simple Syndication (“RSS”) feed options that can help investors stay current

with filings made on EDGAR. See U.S. Securities and Exchange Commission, EDGAR Application

Programming Interfaces (Last Reviewed or Updated April 8, 2025), available at https://www.sec.gov/searchfilings/edgar-application-programming-interfaces; U.S. Securities and Exchange Commission, Structured

Disclosure RSS Feeds (Last Reviewed or Updated Jan. 21, 2026), available at https://www.sec.gov/dataresearch/structured-data/structured-disclosure-rss-feeds. Further, investors may use other websites to receive

alerts when, for example, a company issues a press release or a media outlet publishes a news article about the

company.

Sabrina Chi & Devin M. Shanthikumar, Do Retail Investors Use SEC Filings? Evidence from EDGAR Search

(Oct. 25, 2018), available at https://ssrn.com/abstract=3281234 (finding that retail investor trading is

significantly related to EDGAR searches for Form 10-K and Form 10-Q filings).

Cf. supra note 33 and accompanying text.

investors can readily obtain issuer-specific information that is incorporated by reference into a

prospectus and the related registration statement to make an informed investment decision. If an

issuer is current and timely with respect to its Exchange Act reporting obligations, then an

investor’s ability to obtain such issuer-specific information will not depend on the length of the

issuer’s Exchange Act reporting history or the amount of the issuer’s public float. In the preEDGAR era, it may have been important to include eligibility requirements for short-form

registration that “assure[d] that sufficient information about registrants using the form [was]

available to the investing public through the Exchange Act reporting system.” 43 Today, however,

the public availability of all issuers’ Exchange Act reports in EDGAR effectively addresses the

concerns that animated those requirements. We believe, therefore, that eligibility for Form S-3

and the Enhanced Registration and Communication Benefits no longer should be conditioned on

an issuer’s Exchange Act reporting history, public float, or amount of registered debt issued.

That said, consistent with the Commission’s investor protection mandate, we are not

proposing to expand eligibility to use Form S-3 or the Enhanced Registration and

Communication Benefits to all issuers. For example, under the proposed amendments, issuers

would be eligible to use most of the Enhanced Registration and Communication Benefits only if

they are eligible to use Form S-3 and are exchange-listed. Further, although use of Form S-3

would not be conditioned on an issuer having satisfied the One-Year Seasoning requirement

under the proposed amendments, use of the form would be conditioned on an issuer being

current and timely with respect to all the material required to be filed pursuant to sections 13(a),

14(a), 14(c), and 15(d) of the Exchange Act during the preceding 12 calendar months, or such

Adoption of Amendments to Registration Forms and Guide and Rescission of Registration Form, Release No.

33-5791 (Dec. 20, 1976) [41 FR 56301, 56302 (Dec. 28, 1976)] (“1976 Amendments to Forms S-7 and S-16”).

shorter period that the issuer was required to file such reports and materials. The proposed

amendments also would prohibit issuers from using Form S-3 (and, therefore, the Enhanced

Registration and Communication Benefits) if they are within a category of issuers we believe

pose greater investor protection concerns, including those issuers that potentially present the

highest risk of non-compliance with Securities Act and Exchange Act disclosure requirements.

We discuss each of these aspects of the proposed amendments in more detail below.

II.

DISCUSSION OF PROPOSED AMENDMENTS

A. Form S-3

We are proposing to amend Form S-3 to revise its eligibility requirements. In addition,

we are proposing certain other amendments to Form S-3 that would simplify and modernize the

form. Taken together, these proposed amendments are intended to allow a greater number of

issuers the flexibility to access the public securities markets quickly by using Form S-3 while

also ensuring that investors remain appropriately protected. Form S-3, as it would read under the

proposed amendments, is attached to this release as Appendix B.

1. Background

Eligibility to Use Form S-3 and Conduct Shelf Offerings

Form S-3 is a short-form registration statement that eligible issuers can use to register

offerings under the Securities Act. The ability to use Form S-3 can confer significant advantages

on eligible companies seeking to raise capital through the public markets. Notably, an issuer that

is Form S-3 eligible for primary offerings is permitted to conduct shelf offerings—that is,

offerings made on a delayed basis—under Rule 415. 44 Rule 415 provides issuers with

considerable flexibility to access the public securities markets from time to time in response to

changes in the market and the issuer’s capital needs. Issuers that are eligible to conduct shelf

offerings under Rule 415 are permitted to register securities offerings prior to planning any

specific offering and, once the registration statement is effective, issue securities in one or more

offerings without waiting for further Commission or staff action.

By having more control over the timing of their offerings, eligible issuers can take

advantage of desirable market conditions, thus allowing them to raise capital on more favorable

terms (such as a higher equity price or lower debt interest rate). As a result, the ability to sell

securities “off the shelf” as needed gives issuers a financing alternative that may be more

advantageous for them than other available methods, such as private placements with securities

priced at discounted values based in part on their relative illiquidity.

One of the primary advantages of Form S-3 is the ability to omit from the prospectus

included in a registration statement at the time of effectiveness (the “base prospectus”) certain

information, including, for WKSIs, information as to whether an offering is a primary or

secondary offering, the plan of distribution for the securities, a description of the securities to be

offered other than an identification of the name or class of such securities, and the identification

of other issuers. 45 An issuer can instead provide this information at the time that it is actually

Rule 415(a) provides that “[s]ecurities may be registered for an offering to be made on a continuous or delayed

basis in the future, Provided, That: (1) the registration statement pertains only to: . . . (x) Securities registered

(or qualified to be registered) on Form S-3 or Form F-3 which are to be offered and sold on an immediate,

continuous or delayed basis by or on behalf of the registrant, a majority owned subsidiary of the registrant or a

person of which the registrant is a majority-owned subsidiary.” 17 CFR 230.415(a). Offerings under 17 CFR

230.415(a)(1)(x) (“Rule 415(a)(1)(x)”) are referred to as “shelf offerings” because securities can be offered (or

“taken down” from the shelf registration statement) over time and from time to time. As noted above, for

purposes of this release, the term “shelf offering” is intended to refer to an offering made on a delayed basis.

See 17 CFR 230.430B(a).

conducting an offering, after its terms have been determined. The ability to omit information

from the base prospectus at the time of effectiveness, therefore, enables issuers to conduct shelf

offerings.

In addition, Form S-3 permits the required information to be backward and forward

incorporated by reference to a company’s disclosure in its Exchange Act filings. The ability to

forward incorporate allows for automatic updating of the registration statement. 46 By contrast, a

company without the ability to forward incorporate must file a prospectus supplement to update

information or, in certain cases, file a post-effective amendment to its registration statement to

prevent information in the registration statement from becoming outdated and to update for

fundamental changes to the information set forth in the registration statement. 47

Issuers that are ineligible to file on Form S-3 often register their offerings on Form S-1,

which has far fewer eligibility requirements than Form S-3. 48 Issuers filing registration

statements on Form S-1 are not permitted to register shelf offerings under Rule 415 and therefore

cannot register securities in advance of an actual offering. Thus, as compared to conducting a

shelf offering on Form S-3, it is more challenging (and, in some instances, likely not feasible) for

Form S-1 registrants to take advantage of favorable market opportunities, as they must prepare

and file a registration statement at the time of an expected offering and await Commission or

staff action before offering or selling securities. Further, Form S-1 permits certain issuers to

backward incorporate. Form S-1 currently does not, however, permit issuers other than SRCs to

See 17 CFR 229.512(a)(1)(B).

See 17 CFR 229.512(a)(1).

See General Instruction I of Form S-1 (“This Form shall be used for the registration under the [Securities Act] . .

. of securities of all registrants for which no other form is authorized or prescribed, except that this Form shall

not be used for securities of foreign governments or political subdivisions thereof or asset-backed securities, as

defined in 17 CFR 229.1101(c).”). Form S-3 has more extensive registrant and transaction requirements, as

discussed infra notes 50-64 and accompanying text.

forward incorporate, which therefore requires a company to update the registration statement

through prospectus supplements and post-effective amendments. 49

To use Form S-3, an issuer must meet the form’s registrant requirements, 50 which

generally pertain to the issuer’s reporting history under the Exchange Act, as well as at least one

of the form’s transaction requirements. 51 Form S-3’s registrant requirements (which are

enumerated in General Instruction I.A of Form S-3) specify that to use the form, an issuer must

satisfy each of the following:

•

U.S. Issuer. The issuer must be organized under the laws of the United States or any State

or territory or the District of Columbia and have its principal business operations in the

United States or its territories. 52

•

Exchange Act Reporting. The issuer must have a class of securities registered pursuant to

section 12(b) or 12(g) of the Exchange Act or be required to file reports pursuant to

section 15(d) of the Exchange Act. 53

•

One-Year Seasoning. The issuer must have been subject to the requirements of section 12

or 15(d) of the Exchange Act for a period of at least 12 calendar months immediately

preceding the filing of the registration statement. 54

As discussed in more detail in section II.C below, the proposed amendments would permit other issuers using

Form S-1 (i.e., not just SRCs) to forward incorporate.

See Form S-3, General Instruction I.A.

See Form S-3, General Instruction I.B.

See Form S-3, General Instruction I.A.1.

See Form S-3, General Instruction I.A.2.

See Form S-3, General Instruction I.A.3(a).

•

Current in Exchange Act Reporting. The issuer must have filed all the material required

to be filed pursuant to section 13, 14, or 15(d) of the Exchange Act for a period of at least

12 calendar months immediately preceding the filing of the registration statement. 55

•

Timely in Exchange Act Reporting. The issuer must have filed in a timely manner all

reports required to be filed during the 12 calendar months and any portion of a month

immediately preceding the filing of the registration statement, other than specified reports

on Form 8-K. 56

•

Certain Failures to Make Payments and Defaults. The issuer must have not, since the end

of the last fiscal year for which certified financial statements of the issuer and its

consolidated subsidiaries were included in a report filed pursuant to section 13(a) or

15(d) of the Exchange Act: (a) failed to pay any dividend or sinking fund installment on

preferred stock; or (b) defaulted (i) on any installment or installments on indebtedness for

borrowed money, or (ii) on any rental on one or more long-term leases, which defaults in

the aggregate are material to the financial position of the issuer and its consolidated and

unconsolidated subsidiaries, taken as a whole. 57

•

Electronic Filings. The issuer must have filed with the Commission all required

electronic filings. 58

See id. General Instruction I.A.3(b) of Form S-3 specifies that an issuer must be timely in its Exchange Act

reports “during the twelve calendar months and any portion of a month immediately preceding the filing of the

registration statement.” As an illustration of how that measurement period functions, an issuer intending to file a

Form S-3 on July 19, 2026 would have to have been current and timely with respect to its Exchange Act filings,

other than specified reports on Form 8-K, from July 1, 2025 through July 19, 2026.

See Form S-3, General Instruction I.A.3(b).

See Form S-3, General Instruction I.A.4.

See Form S-3, General Instruction I.A.7(a).

•

Interactive Data Files. The issuer must have submitted electronically to the Commission

all Interactive Data Files 59 required to be submitted pursuant to 17 CFR 232.405 during

the 12 calendar months and any portion of a month immediately preceding the filing of

the registration statement on Form S-3 (or for such shorter period of time that the issuer

was required to submit such files). 60

Foreign issuers, other than foreign governments, also can use Form S-3 if they satisfy all

the registrant requirements, other than the “U.S. Issuer” eligibility requirement, and file the same

Exchange Act reports as a domestic issuer. 61 In addition, successor issuers are permitted to use

Form S-3 if they meet certain conditions. 62

Form S-3’s transaction requirements (which are enumerated in General Instruction I.B of

Form S-3) specify that the form can be used for primary offerings only under the following

circumstances:

•

General Instruction I.B.1 – Primary Offerings by Certain Registrants. An issuer may

the issuer’s public float is $75 million or more.

•

If an issuer does not have a public float of at least $75 million, it may nevertheless

17 CFR 232.11 defines Interactive Data File as “the machine-readable computer code that presents information

in eXtensible Business Reporting Language (XBRL) electronic format pursuant to § 232.405 and as specified

by the EDGAR Filer Manual.”

See Form S-3, General Instruction I.A.7(b).

See Form S-3, General Instruction I.A.5.

See Form S-3, General Instruction I.A.6. Specifically, successor issuers may use Form S-3 if: (a) the issuer’s

predecessor and the successor issuer, taken together, meet the registrant requirements, and the succession was

primarily for the purpose of changing the state of incorporation of the predecessor or forming a holding

company and the assets and liabilities of the successor at the time of succession were substantially the same as

those of the predecessor; or (b) if all predecessors met the conditions at the time of succession and the successor

issuer has continued to do so since the succession. See id.

o General Instruction I.B.2 – Primary Offerings of Non-Convertible Securities

Other than Common Equity. An issuer may register a primary offering of nonconvertible securities other than common equity, provided the issuer: (1) has

issued at least $1 billion in non-convertible securities, other than common equity,

in primary offerings for cash registered under the Securities Act over the prior

three years; (2) has outstanding at least $750 million of non-convertible securities,

other than common equity, issued in primary offerings for cash registered under

the Securities Act; (3) is a wholly-owned subsidiary of a WKSI; or (4) is a

majority-owned operating partnership of a real estate investment trust (“REIT”)

that qualifies as a WKSI.

o General Instruction I.B.4 – Rights Offerings, Dividend or Interest Reinvestment

Plans, and Conversions or Warrants and Options. An issuer may register

securities to be offered upon exercise of outstanding rights, under a dividend or

interest reinvestment plan, or upon the conversion of outstanding convertible

securities or the exercise of outstanding warrants or options, if certain conditions

are met.

o General Instruction I.B.6 – Limited Primary Offerings by Certain Other

Registrants. An issuer that is not a shell company may register any primary

offering if it is exchange-listed and the aggregate market value of securities sold

by or on behalf of the issuer under the instruction during the 12 months

immediately prior to, and including, the sale is no more than one-third of the

issuer’s public float.

Form S-3’s transaction requirements specify that the form can be used for resale offerings

only under the following circumstances:

•

General Instruction I.B.1 – Primary Offerings by Certain Registrants. 63 An issuer may

million.

•

General Instruction I.B.3 – Transactions Involving Secondary Offerings. If an issuer does

not have a public float of at least $75 million, resales of outstanding securities can be

registered on Form S-3 if the securities are listed on a national securities exchange or

quoted on the automated quotation system of a national securities association. 64

In addition, General Instruction I.B.5 provides that Form S-3 may not be used to register

offerings of asset-backed securities, as defined in 17 CFR 229.1101(c).

Finally, Form S-3 has instructions that specify circumstances under which certain

subsidiaries are eligible to use the form. 65 In addition to the permissible offerings by subsidiaries

identified in General Instruction I.B.2 (with respect to wholly-owned subsidiaries of WKSIs and

majority-owned operating partnerships of REITs that qualify as WKSIs), General Instruction I.C

provides that majority-owned subsidiaries may register certain offerings on Form S-3 if:

Although General Instruction I.B.1 is titled “Primary Offerings by Certain Registrants,” the instruction, in

addition to permitting primary offerings, permits registration of “outstanding securities to be offered for cash for

the account of any person other than the registrant” if the issuer’s public float is $75 million or more.

The reference in General Instruction I.B.3 to securities being “quoted on the automated quotation system of a

national securities association” is a reference to The Nasdaq Stock Market LLC (“Nasdaq”) before Nasdaq

became a national securities exchange. Because Nasdaq is now a national securities exchange, this language has

no effect. Accordingly, a class of securities to be offered in reliance on General Instruction I.B.3 must be listed

on a national securities exchange.

The definition of WKSI under 17 CFR 230.405 (“Rule 405”) also allows majority-owned subsidiaries of

WKSIs to be treated as WKSIs for purposes of certain offerings. We discuss the WKSI status of these issuers

and our related proposed amendments in section II.B below.

•

the issuer-subsidiary itself meets the registrant requirements and the applicable

transaction requirement; 66

•

the parent of the issuer-subsidiary meets the registrant requirements and the conditions of

General Instruction I.B.2 are met; 67

•

the parent of the issuer-subsidiary meets the registrant requirements and the applicable

transaction requirement, and provides a full and unconditional guarantee, as defined in 17

CFR 210.3-10 (“Rule 3-10 of Regulation S-X”), of the payment obligations on the

securities being registered, and the securities being registered are non-convertible

securities, other than common equity; 68

•

the parent of the issuer-subsidiary meets the registrant requirements and the applicable

transaction requirement, and the securities of the issuer-subsidiary being registered are

full and unconditional guarantees, as defined in Rule 3-10 of Regulation S-X, of the

payment obligations on the parent’s non-convertible securities, other than common

equity, being registered; 69 or

•

the parent of the issuer-subsidiary meets the registrant requirements and the applicable

transaction requirement, and the securities of the issuer-subsidiary being registered are

guarantees of the payment obligations on the non-convertible securities, other than

common equity, being registered by another majority-owned subsidiary of the parent

See Form S-3, General Instruction I.C.1.

See Form S-3, General Instruction I.C.2.

See Form S-3, General Instruction I.C.3.

See Form S-3, General Instruction I.C.4.

where the parent provides a full and unconditional guarantee, as defined in Rule 3-10 of

Regulation S-X, of such non-convertible securities. 70

For convenience, throughout the remainder of this release, we refer to the offerings involving

parent or subsidiary guarantees permitted under General Instructions I.C.3, I.C.4, and I.C.5 as

“Guarantee-Related Offerings.”

b. History of Short-Form Registration

The Commission first introduced short-form registration “in the nature of an experiment”

with Form S-7 in 1967. 71 Unlike other forms, Form S-7 permitted eligible issuers to omit certain

information about the issuer, such as property descriptions, pending legal proceedings, and

director and executive compensation. To use the form, issuers had to have a class of equity

securities registered under section 12(b) or (g) of the Exchange Act and had to be current and

timely in their Exchange Act reporting for at least five years. 72 Issuers also had to satisfy other

qualitative criteria related to business continuity, 73 board stability, 74 solvency, 75 financial

See Form S-3, General Instruction I.C.5.

Adoption of Short Form for Registration of Securities of Certain Issuers and Amendment of Rule 174, Release

No. 33-4886 (Nov. 29, 1967) [32 FR 17933 (Dec. 15, 1967)] (“Form S-7 Release”). The Commission had

previously adopted a registration statement designated Form S-7 in 1947 to be used by the International Bank of

Reconstruction and Development. See Adoption of Form S-7, Release No. 33-3238 (July 8, 1947) [12 FR 4531

(July 10, 1947)]. This form was rescinded in 1950. See Bretton Woods Agreement, Release No. 33-3364 (Jan. 9,

1950) [15 FR 280 (Jan. 17, 1950)].

Form S-7 was available to listed issuers with a class of common equity securities registered under section 12(b)

and unlisted domestic issuers that had a class of equity securities registered under section 12(g). See Form S-7

Release.

The registrant was required to have been engaged in business of substantially the same general character since

the beginning of the last five fiscal years.

The issuer’s board of directors had to have been directors of the registrant during each of the last three fiscal

years.

The issuer and its subsidiaries could not have, during the prior 10 years, defaulted in the payment of any

dividend or sinking fund installment on preferred stock, or in the payment of any principal, interest, or sinking

fund installment on any indebtedness for borrowed money, or in the payment of rentals under long term leases.

performance, 76 and dividend coverage. 77 The rationale for this short-form registration statement

was that the omitted information was already available through the issuer’s Exchange Act

reports, making its inclusion in the registration statement unnecessary. 78

Over time, the Commission has periodically amended its rules and forms to broaden the

availability of short-form registration and shelf offerings. In the Commission’s 1969 Disclosure

Policy Study led by Commissioner Francis Wheat (often referred to as the “Wheat Report”), the

Commission recommended a “substantial expansion” of short-form registration. 79 In response,

the Commission broadened short-form eligibility by decreasing Form S-7’s five-year Exchange

Act reporting requirement to three years and eliminating or easing certain qualitative criteria. 80

That same year, the Commission further expanded short-form registration by adopting

Form S-16, which increased the scope of offerings available to issuers eligible to use Form S-7. 81

The issuer and its consolidated subsidiaries had to have had sales or gross revenues of at least $50 million for

the prior fiscal year and a net income, after taxes but before extraordinary items net of tax effect, of at least $2.5

million for the prior fiscal year, and of at least $1 million for each of the preceding four fiscal years.

If the securities to be registered were common stock or securities convertible into common stock, the issuer had

to have earned in each of the prior five fiscal years any dividends paid in each such year on all classes of

securities. In addition, if the issuer paid a stock dividend in any of such fiscal years, the aggregate amount

transferred from surplus to capital in respect of each such dividend had to have been charged only to the earned

surplus account and been equal to the aggregate fair market value of the stock issued as such dividend.

See Form S-7 Release (noting that “[t]he form represents a closer integration of the requirements of the

[Securities Act] and the [Exchange Act]” and that “prospectuses and registration statements on this form will be

substantially shorter than heretofore and will, therefore, be substantially easier both for the issuer to prepare and

for the Commission to process”).

FRANCIS M. WHEAT, DISCLOSURE TO INVESTORS - A REAPPRAISAL OF ADMINISTRATIVE POLICIES UNDER THE

’33 AND ’34 SECURITIES ACTS, at 67–68 (1969), available at

https://www.sechistorical.org/museum/galleries/tbi/gogo_d.php.

See Adoption of Amendments to Form S-7, Release No. 33-5100 (Nov. 12, 1970) [35 FR 228 (Nov. 24, 1970)].

Specifically, the Commission eliminated the business continuity requirement and eased the board stability

requirement (by specifying that a majority of the existing board must have been directors of the issuer or a

predecessor for each of the last three, rather than five, fiscal years) and the financial performance requirement

(eliminating the requirement to have had gross revenues of at least $50 million for the prior fiscal year and

replacing the requirement to have had net income of at least $2.5 million in the last fiscal year and $1 million

for each of the last five fiscal years with a requirement to have had net income of $500,000 in each of the last

five fiscal years).

See Adoption of Form S-16 for Registration of Securities to be Offered in Specified Transactions and

Amendment of Rules 427 and 429, Release No. 33-5117 (Dec. 23, 1970) [36 FR 777 (Jan. 16, 1971)].

Specifically, Form S-16 allowed these issuers to register secondary offerings of securities listed

on a national securities exchange, conversions of convertible securities, and warrant exercises. 82

Unlike Form S-7, Form S-16 allowed incorporation by reference of an issuer’s Exchange Act

reports, including forward incorporation, and required fewer disclosures. 83

In 1976, the Commission again amended Form S-7 to extend its availability—and, by

extension, that of Form S-16—to a larger number of issuers. 84 The amendments made Form S-7

available to issuers with a class of debt securities registered under section 12(b) as well as issuers

with a section 15(d) reporting obligation. They also permitted use by successor issuers and

certain majority-owned subsidiaries of Form S-7 eligible parents, while broadening eligibility by

reducing the Exchange Act reporting timeliness requirement from three years to one year. In

addition, the amendments eliminated the board stability and dividend coverage requirements and

eased the financial performance requirement. 85 The Commission also retained certain

safeguards—including the requirement that issuers have filed all Exchange Act reports for 36

months—“to assure that sufficient information about registrants using the form is available to the

investing public through the Exchange Act reporting system.” 86

In 1978, the Commission further expanded the scope of short-form registration by

amending Form S-16 to permit primary cash underwritten offerings by any Form S-7 eligible

issuer with a public float of at least $50 million. 87 The amendments also allowed offerings by

See id.

See 1976 Amendments to Forms S-7 and S-16.

See supra notes 73-77 and accompanying text for a description of the qualitative issuer requirements of Form S7. The amendments also made Form S-7 available for certain exchange offers. See 1976 Amendments to Forms

S-7 and S-16.

Id.

1978 Amendments to Short-Form Registration.

majority-owned subsidiaries whose securities were fully and unconditionally guaranteed by a

parent meeting the $50 million public float threshold. The Commission characterized these

amendments as “extremely important,” noting that they were expected to “reduce registration

costs and thus the costs of raising capital, facilitate timely access to the capital markets, make

more meaningful the periodic reporting requirements of the Exchange Act and eliminate needless

duplication of disclosure which results in increased costs to investors.” 88 At the same time, the

Commission explained that the $50 million public float requirement was intended to limit

eligibility to “a small top tier of companies . . . which usually provide high quality corporate

communication documents, including [Exchange] Act reports, and whose corporate information

is widely disseminated because members of this class of registrants are widely followed by debt

and equity analysts.” 89

In 1982, the Commission replaced Forms S-7 and S-16 with Forms S-2 and S-3 as part of

adopting the “integrated disclosure system.” 90 Form S-2 allowed any issuer that had been an

Exchange Act reporting company for at least 36 months (and had timely filed its reports during

the prior 12 calendar months) to register any transaction, other than an exchange offer, on a

Id. at 16673.

Id. (internal quotation marks omitted) (quoting The Report of the Advisory Committee on Corporate Disclosure

to the Securities and Exchange Commission (Nov. 3, 1977), Committee Print 95-29, House Committee on

Interstate and Foreign Commerce, 95th Cong., 1st Sess.). With respect to the $50 million public float

requirement in particular, the Commission stated that “this requirement will provide some assurance that, in

addition to wide dissemination of information about such companies in the market place, securities analysts will

follow companies of this size.” Id. Although the Commission recognized that “[t]he lack of interest of securities

professionals in a company does not mean necessarily that information about that company is not readily

available or that the public information is of inferior quality,” it further noted that “professional interest should

help assure market reaction to material information about a company and thereby alleviate the need to provide

the information directly to offerees when securities are registered on Form S-16 for a primary offering.” Id.

Adoption of Integrated Disclosure System, Release No. 33-6383 (Mar. 3, 1982) [47 FR 11380 (Mar. 16, 1982)]

(“Integrated Disclosure Adopting Release”) (implementing an integrated disclosure system by, among other

things, “expan[ding] and reorganiz[ing] . . . Regulation S-K as the repository for the uniform disclosure

requirements of documents filed with the Commission under the Securities Act and the [Exchange Act]”).

short-form basis. 91 Similar to Form S-7, instead of providing all required disclosures directly in

the prospectus, issuers that qualified to use the form could choose to either (i) deliver a copy of

the annual report to security holders with the prospectus or (ii) present issuer-oriented

information comparable to that required to be included in such annual report in the prospectus. In

either case, the more complete issuer information required by the form was incorporated by

reference into the prospectus from the issuer’s most recent annual report on Form 10-K. Form S2 did not permit forward incorporation; accordingly, updating amendments (which required

Commission or staff action to become effective) had to be filed for ongoing offerings. 92

As initially adopted, Form S-3 permitted registration of any primary or secondary

offering if the issuer had, among other requirements: (1) been subject to Exchange Act reporting

for at least 36 months; (2) timely filed its Exchange Act reports for the 12 months prior to filing

the registration statement; and (3) at least $150 million in public float, or, alternatively, at least

$100 million in public float if the annual trading volume of such stock was at least three million

shares. 93 An issuer also could register certain specific transactions on Form S-3 without regard to

public float, including primary offerings of investment grade non-convertible debt or preferred

The Commission initially sought public comment on whether to add a market criterion, such as public float, as a

condition of Form S-2 eligibility. See Proposed Comprehensive Revision to System for Registration of

Securities Offerings, Release No. 33-6235 (Sept. 2, 1980) [45 FR 63693 (Sept. 25, 1980)] (“1980 Proposed

Revisions”). The Commission determined not to move forward with such a requirement, stating that although it

“believes such criteria, which ensure adequate information dissemination, are necessary where, as in the case of

an offering on Form S-3, much of the underlying disclosure is not delivered . . . , with Form S-2 there is

delivery of the basic disclosure documents and therefore the Commission believes that requirement can be

deleted.” 1981 Reproposal at 41912.

The Commission rescinded Form S-2 in 2005 because requiring physical delivery of Exchange Act reports had

“become outdated in view of the introduction of EDGAR, other technological developments, and the rapid

dissemination of information in the market.” Securities Offering Reform Adopting Release at 44782. The

Commission also stated that Form S-2 had become “superfluous” in light of concurrent amendments to Form S1 that allowed certain Exchange Act reporting issuers to incorporate by reference into Form S-1 information

from previously filed Exchange Act reports and documents. Id.

See Integrated Disclosure Adopting Release.

stock, secondary offerings of a class of securities listed on a national securities exchange or

quoted on the Nasdaq interdealer quotation system, rights offerings to shareholders, offerings of

securities issuable upon exercise of warrants or upon conversion of other outstanding securities,

and offerings pursuant to dividend and interest reinvestment plans. 94

The Commission adopted Form S-3 “in reliance on the efficient market theory,” 95 with

registrant and transaction requirements designed to “relat[e] short-form registration to the

existence of widespread following in the marketplace.” 96 Based on commenter input, the

Commission explained that “a test based on the registrant’s [public] float . . . is an appropriate

measure of marketplace following” and determined that “a [public] float of $150 million is the

appropriate level at which short-form registration should be allowed.” 97

c. History of Shelf Registration

At the same time it adopted Forms S-2 and S-3 in 1982, the Commission also adopted

Rule 415 as a “temporary rule.” 98 Rule 415 conditionally permitted shelf registration and

codified Commission staff practice that had informally permitted shelf registration prior to that

time. 99 The Commission permanently adopted Rule 415 in 1983 after it concluded that the rule

Id.

Id. at 11382.

Id. at 11384.

Id.

See id. at 11394.

This staff practice was set forth in a release commonly referred to as “Guide 4,” which was published in 1968.

See Guides for Preparation and Filing of Registration Statements, Release No. 33-4936 (Dec. 9, 1968) [33 FR

18617 (Dec. 17, 1968)]. Guide 4 set forth the Division of Corporation Finance’s view that the last sentence of

section 6(a) of the Securities Act, 15 U.S.C. 77f(a) (“A registration statement shall be deemed effective only as

to the securities specified therein as proposed to be offered.”), prohibited “securities [to] be registered if there is

no intention to offer them within the proximate future.” Id. Guide 4 also set forth the Division’s view that

“[t]here are, however, certain types of deferred or extended offerings for which registration is permitted or

required” (e.g., when the issuer proposed to engage in a continuing acquisition program or in the case of

securities underlying exercisable options, warrants, or rights). Id.

“has operated efficiently and has provided registrants with important benefits in their financings,

most notably cost savings.” 100 In doing so, the Commission acknowledged commenters’

concerns regarding the “adequacy of disclosure and due diligence” 101 and addressed those

concerns by “limiting the Rule to primary offerings of securities qualified to be registered on

Form S-3 or F-3 and to traditional shelf offerings.” 102 The Commission noted that “[t]he

integrated disclosure system addresses concerns about the quality and timeliness of disclosure by

ensuring that the marketplace is provided with a continuous stream of high quality corporate

information about registrants widely followed in the marketplace.” 103 The Commission further

stated that “[f]or registrants not eligible to use short form registration, . . . concerns about

disclosure and due diligence outweigh the benefits of Rule 415.” 104

In 1992, the Commission amended Form S-3 to make it and, by extension, shelf

registration, available to a broader group of issuers and classes of transactions. 105 It increased the

100

Shelf Registration Adopting Release at 52890 (“The cost savings are attributable to a number of factors,

including flexibility to respond to rapidly changing markets, reduced legal, accounting, printing and other

expenses and increased competition among underwriters.”).

101

Id. at 52890. With respect to adequacy of disclosure, commenters “question[ed] the amount and quality of

information available, as well as whether investors receive it in time to make investment decisions” and

“express[ed] concern that [Rule 415] contributes to deficiencies in the disclosure provided to investors caused,

in great part, by short form registration statements.” Id. at 52892. With respect to due diligence, commenters

“attribute[d] concerns . . . largely to fast time schedules” associated with shelf offerings under Rule 415. Id. at

52892-93.

102

Id. at 52890. Commenters also expressed concerns about the “institutionalization of the securities markets,

impact on retail distribution, increased concentration in the securities industry, [and] effects on the secondary

markets.” Id. at 52893. The Commission noted, however, that these concerns “relate to economic factors, such

as volatile interest rates and other market forces, which exist apart from Rule 415 and thus are not appropriate

bases on which to take action on the Rule.” Id.

103

Id. With respect to registrants not eligible to use short-form registration, “[t]he Commission also note[d] that

shelf registration may not be as advantageous for such registrants because they cannot rely on subsequently

filed Exchange Act reports for certain updating of the information in the shelf registration statement.” Id. at

52893-94.

104

Id.

105

Simplification of Registration Procedures for Primary Securities Offerings, Release No. 33-6964 (Oct. 22,

1992) [57 FR 48970 (Oct. 29, 1992)] (“1992 Adopting Release”).

pool of eligible issuers by shortening the requisite Exchange Act reporting history from 36 to 12

months for most issuers and reducing the public float requirement from $150 million to $75

million.106 In proposing these amendments, the Commission cited the success of Form S-3 and

the integrated disclosure system over the previous 10 years, which had “achieved their intended

effects of providing issuers efficient access to the public securities markets without

compromising investor protection” and “improvement in the quality of ongoing Exchange Act

reporting.” 107 Among other things, the Commission noted that the amendments “would provide

significant cost savings, efficiency and flexibility for many issuers” and, with respect to the

expanded access to shelf registration, “allow[] significantly greater numbers of issuers the

flexibility to access the public securities markets on demand without having to obtain additional

clearance from the Commission’s staff,” which would “remove unnecessary regulatory obstacles

to capital raising.” 108

The 1992 amendments also permitted shelf registration of debt, equity, and other

securities on an unallocated basis and provided for immediate effectiveness of Form S-3

registration statements for dividend and interest reinvestment plans. 109 The Commission

suggested that unallocated offerings may promote greater use of shelf offerings, especially for

common stock offerings. In this regard, the Commission noted “[t]he limited use of shelf

106

The Commission also eliminated the alternative test of $100 million public float with annual trading volume of

three million shares because this test became unnecessary due to the lower $75 million public float threshold.

107

Simplification of Registration Procedures for Primary Securities Offerings, Release No. 33-6943 (July 16,

1992) [57 FR 32461, 32463 (July 22, 1992)] (“1992 Proposing Release”).

108

1992 Adopting Release at 48971.

109

In an unallocated shelf offering, an issuer is permitted to disclose the various types and categories of securities

(both debt and equity) covered by the registration statement without assigning a specific dollar amount to each

category to be offered. In such offering, the registration statement lists the types of securities covered and the

prospectus supplement filed in connection with a “takedown” offering from the shelf registration statement

specifies the amount of the particular security being offered.

registration for common stock,” which it attributed to “concerns by registrants about the market

effects from the overhang created by such registration, as well [as] concerns that the market

would view even a registration statement for possible future sales of common stock as signaling

management’s view that the price of the stock has reached a peak.” 110 The Commission

addressed these concerns by allowing issuers to identify the types of securities covered by the

registration statement without having to identify the specific amount (either number of shares or

dollar amount) of each category to be offered (these registration statements are commonly

referred to as “universal shelf registration statements”).

The Commission further liberalized the shelf registration process in several ways in a

2005 rulemaking titled “Securities Offering Reform.” 111 First, the Commission permitted a new

category of issuers, referred to as WKSIs, greater flexibility in registering their securities

offerings by allowing them to file shelf registration statements on Form S-3 that are

automatically effective upon filing with the Commission. 112 Second, the Commission adopted

rules allowing WKSIs using automatic shelf registration statements to pay filing fees at any time

(i.e., either in advance of a takedown or on a “pay-as-you-go” basis at the time of each

takedown). 113 The “pay-as-you-go” model enabled WKSIs to file shelf registration statements

without specifying a total dollar amount of securities to be offered. Third, the Commission

110

1992 Proposing Release at 32466. “Overhang” generally refers to potential downward pressure on an issuer’s

stock price that may occur when an issuer signals a willingness to sell securities in the future by filing a shelf

registration statement and investors fear future dilution stemming from future issuances. See, e.g., Mary C.

Neary, SEC Rule 415: Resolving the Dilemma of Shelf Registrations Creates Problems of Its Own, 3 PACE L.

REV. 275, 300 (1983) (“[N]ot knowing when a large block of stock will be sold from the shelf, or the date,

underwriter, or timing of future offerings, creates what is known as an ‘overhang’ problem, and intensifies the

downward pressure, effectively placing a lid on the stock price.”).

111

See Securities Offering Reform Adopting Release.

112

See 17 CFR 230.462(e); 17 CFR 239.13(d). The term “WKSI” and the benefits currently reserved for these

issuers are discussed in greater detail in section II.B below.

113

See 17 CFR 230.456(b).

eliminated a provision in Rule 415 that limited the amount of securities that could be registered

for certain primary offerings on Form S-3 to an amount reasonably expected to be offered and

sold within two years. 114 Fourth, WKSIs were permitted to add new classes of securities or

securities of an eligible subsidiary to an already effective automatic shelf registration statement

by post-effective amendment. 115 Finally, the amendments eliminated certain limitations imposed

on ATM offerings by seasoned issuers. 116

To further enhance issuers’ access to the public markets, the Commission in 2007 again

amended the eligibility requirements of Form S-3. 117 These amendments allowed an even greater

number of issuers to conduct primary securities offerings on the form, and, in turn, to conduct

shelf offerings. Significantly, under these amendments, an issuer could use Form S-3 to conduct

primary shelf offerings without regard to the size of its public float or the rating of its debt to be

offered if it satisfied the form’s registrant requirements, was not a shell company, was exchangelisted, and did not sell more than the equivalent of one-third of its public float in primary

offerings over any period of 12 calendar months.

In further extending Form S-3 eligibility to a broader group of issuers and allowing the

use of Form S-3 without regard to an issuer’s public float, the Commission stated its “belie[f]

that extending Form S-3 short-form registration to additional issuers should enhance their ability

to access the public securities markets.” 118 The Commission also noted “that such a measure

114

See Securities Offering Reform Adopting Release at 44774-75.

115

See 17 CFR 230.413(b). In general, securities cannot be added to an effective registration statement. See 17

CFR 230.413(a).

116

Specifically, the Commission eliminated a requirement that ATM offerings involve an underwriter and a

requirement that an ATM offering not exceed 10% of the issuer’s public float if the offering related to voting

stock.

117

See Baby Shelf Adopting Release.

118

Id. at 73535.

would greatly enhance smaller public companies’ access to capital in the securities markets, with

far less burden and cost.” 119 In adopting these amendments, the Commission emphasized “the

great advances in the electronic dissemination and accessibility of company disclosure

transmitted over the Internet in the last several years.” 120 The Commission, therefore, was

“persuaded that the technological advances that have revolutionized communications between

companies and the market should allow us to ease the Form S-3 eligibility standards without

undermining investor protection or the integrity of the markets.” 121

Nonetheless, the Commission stated that it was not prepared at that time “to allow

unlimited use of this form for primary offerings by companies who do not have at least $75

million in public float.” 122 In that regard, the Commission noted certain concerns related to

allowing smaller public companies to use shelf registration. Those concerns included “that the

securities of smaller public companies are comparatively more vulnerable to price manipulation

than the securities of larger public companies, and may also be more prone to financial reporting

error and abuses” and “that the disclosure obligations and liability imposed by the federal

securities laws on smaller public companies are comparable, but not identical, to the largest

reporting companies.” 123

119

Id.

120

Id.

121

Id. at 73536.

122

Id. at 73535.

123

Id. at 73536. In addition, although the Commission cited certain technological advances as a reason for

expanding Form S-3 eligibility, it also explained that “[w]hile current technology provides investors with access

to information about publicly reporting companies at an unprecedented level of ease and speed, it does not

guarantee that the market has fully absorbed and synthesized all of the available information of a given

company” and that “[t]echnology can facilitate and enhance market following, but it does not ensure it.” Id.

In part due to those concerns, the Commission stated that only a “modest expansion of

Form S-3 . . . eligibility” was warranted at that time. 124 The Commission further explained,

however, that it “may revisit the appropriateness of the form restrictions at a later time if our

experience with this revised requirement suggests issuer eligibility for primary offerings on Form

S-3 . . . should be further revised.” 125 The Commission has not further expanded shelf offerings

or Form S-3 eligibility since 2007.

d. Public Views on Expanding Form S-3 Eligibility

Over the years, some market participants have advocated for expanding Form S-3

eligibility to reduce compliance costs in connection with registered offerings and to promote

capital formation. Those commentators have proposed different methods for accomplishing this

objective.

For example, in 2006, the Commission’s Advisory Committee on Smaller Public

Companies recommended allowing all Exchange Act reporting companies that had been

reporting for at least one year and were listed on a national securities exchange or quoted in the

over-the-counter market to use Form S-3. 126 In response to a 2011 Commission proposing

release, one commenter recommended eliminating Form S-3’s transaction requirements and

permitting its use by issuers that had reliably filed Exchange Act reports for at least one year. 127

124

Id. at 73534.

125

Id.

126

Recommendation IV.P.3. of the Final Report of the Advisory Committee on Smaller Public Companies (Apr.

23, 2006), at 68-72 (“[W]e recommend that the efficiencies associated with the use of Form S-3 be made

available to all companies that have been reporting under the Exchange Act for at least one year, and are current

in their Exchange Act reporting at the time of filing. Additionally, we recommend elimination of the current

condition to the use of Form S-3 that the issuer has timely filed all required reports in the last year.”), available

at http://www.sec.gov/info/smallbus/acspc/acspc-finalreport.pdf.

127

See letter in response to Security Ratings, Release No. 33-9186 (Feb. 9, 2011) [76 FR 8946 (Feb. 16, 2011)]

(“Security Ratings Proposing Release”) from Securities Industry and Financial Markets Association (Mar. 18,

2011).

Participants at the Commission’s 2012 Government-Business Forum on Small Business Capital

Formation recommended permitting “all public companies (regardless of public float or

exchange-traded status) to utilize Form S-3 for primary and secondary offerings” or eliminating

the one-third limit under General Instruction I.B.6 for exchange-listed issuers. 128 In 2015,

another commentator supported making Form S-3 available to any issuer current in its Exchange

Act reporting obligations, regardless of public float. 129 At the “Small Cap Policy Roundtable:

Reassessing the Framework for Small Public Companies” hosted by the Commission’s Office of

the Advocate for Small Business Capital Formation, some participants recommended

reconsideration of: (1) the One-Year Seasoning requirement and the requirement to have a Form

10-K on file to use Form S-3; (2) the $75 million public float requirement in General Instruction

I.B.1 and raising the related one-third limit in General Instruction I.B.6; (3) whether failing to

file a Form 8-K should result in a 12-month ineligibility to use Form S-3; and (4) whether it

makes sense to lose Form S-3 eligibility over a limited omission of XBRL tags. 130 Also in 2025,

the New York City Bar Association recommended that all exchange-listed issuers be permitted

to register offerings in any amount on Form S-3. 131 More recently, a participant at the

Commission’s annual Small Business Forum recommended that the Commission consider

128

31st Annual Government-Business Forum on Small Business Capital Formation, Final Report (Nov. 15, 2012),

at 26, 28, available at https://www.sec.gov/info/smallbus/gbfor31.pdf.

129

Legislative Proposals to Enhance Capital Formation and Reduce Regulatory Burdens, Part II: Hearing Before

the Subcomm. on Capital Markets and Government Sponsored Enterprises, 114th Cong. (2015) (Statement of

David Weild) (“We would also support the expansion of Form S-3 and other shelf registration approaches to

improve access to capital for smaller public companies that are current with their SEC filings.”), available at

https://financialservices.house.gov/uploadedfiles/hhrg-114-ba16-wstate-dweild-20150513.pdf.

130

See Transcript of Small Cap Policy Roundtable: Reassessing the Framework for Small Public Companies at 2627, 34-35 (June 18, 2025), available at https://www.sec.gov/files/small-cap-policy-roundtable-transcript.pdf.

131

See letter from New York City Bar Ass’n to The Hon. Paul S. Atkins dated May 27, 2025 (“We recommend

that the Commission eliminate or increase the one-third public float limit in General Instruction I.B.6 of Form

S-3 or exempt issuers after some period of time (e.g., one year after the company becomes eligible to file on

Form S-3).”), available at https://www.nycbar.org/reports/letter-to-sec-chairman-atkins-with-recommendationsfor-rulemaking-and-guidance/.

shortening the One-Year Seasoning requirement, eliminating or reducing the $75 million public

float requirement in General Instruction I.B.1, and eliminating or reducing the 12-month

ineligibility that results from a late Form 8-K filing. 132 Various others commentators have

recommended modernizing the registration process or shelf eligibility without specifying the

manner for doing so. 133

There also have been legislative attempts to expand access to Form S-3 by allowing all

exchange-listed issuers to register any offering on the form, regardless of public float, and to

allow non-exchange-listed issuers to register on Form S-3 primary offerings of up to one-third of

their public float. 134 Opponents of these proposals, however, cautioned that such changes could

“allow companies to avoid SEC staff review and risk increased fraud and market manipulation,

particularly for non-exchange traded companies.” 135

132

See Transcript of the 45th Annual Small Business Forum at 161-62 (Mar. 9, 2026), available at

https://www.sec.gov/files/transcript-45th-sb-forum.pdf.

133

See, e.g., 44th Annual Small Business Forum, Final Report (Apr. 10, 2025) (recommending that the

Commission “[s]treamline the SEC registration process for smaller businesses”); Transcript of the 44th Annual

Small Business Forum (Apr. 10, 2025), comments of Dave Lynn (encouraging the Commission to review

smaller company access to shelf registration), available at https://www.sec.gov/files/2025-SBF-508Transcript.pdf; 37th Annual Government-Business Forum on Small Business Capital Formation, Final Report

(Dec. 12, 2018) (forum participants recommending “[i]ncreasing the companies that can take advantage of

Form S-3—whether listed on a national exchange or not”), available at

https://www.sec.gov/info/smallbus/gbfor37.pdf; Legislative Proposals to Enhance Capital Formation for Small

and Emerging Growth Companies, 113th Cong. (2014) (Statement of Brian Hahn) (recommending “[e]xpanded

eligibility for Form S-3 to encompass a greater pool of small companies”), available at

https://financialservices.house.gov/uploadedfiles/hhrg-113-ba16-wstate-bhahn-20140409.pdf.

134

Accelerating Access to Capital Act of 2017, H.R. 4529, 115th Cong. (2017); Accelerating Access to Capital Act

of 2016, H.R. 2357, 114th Cong. (2015); Small Business Freedom to Grow Act of 2014, H.R. 4568, 113th

Cong. (2014).

135

H.R. Rep. No. 115-576, at 9 (2017) (noting that “[c]urrent restrictions for companies using Form S-3, which are

based on size and whether they are traded on an exchange, ensure that they have timely information available to

the public, ample liquidity, and strong corporate governance standards,” and expressing the view that the

proposed legislation “would dangerously expand the type of companies that are eligible to use . . . Form S-3 to

https://www.govinfo.gov/content/pkg/CRPT-115hrpt576/pdf/CRPT-115hrpt576.pdf; see also Legislative

Proposals to Enhance Capital Formation for Small and Emerging Growth Companies, 113th Cong. (2014)

2. Proposed Amendments

We are proposing to amend Form S-3’s registrant requirements and to eliminate the form’s

transaction requirements 136 to simplify and expand eligibility, thereby allowing significantly more

issuers to avail themselves of the form’s flexibility to access the public securities markets on

demand. 137

With respect to the registrant requirements, the proposed amendments would eliminate

the “One-Year Seasoning,” “Certain Failures to Make Payments and Defaults,” “Electronic

Filings,” and “Interactive Data Files” eligibility requirements described above. 138 The proposed

amendments would retain the “Current in Exchange Act Reporting” and “Timely in Exchange

Act Reporting” requirements and would add two new registrant requirements prohibiting a

subset of “ineligible issuers,” as that term is defined in Rule 405, and certain other types of

issuers (as discussed in section II.A.2.a.v below) from using Form S-3.

With respect to the transaction requirements, the proposed amendments would eliminate

those requirements, including the requirement in General Instruction I.B.1 that the issuer have a

(Statement of Professor John C. Coffee, Jr.) (expressing concern about allowing smaller issuers, including those

in the over-the-counter market and Pink Sheets, to use Form S-3 for unlimited capital raising activities, but also

questioning whether the market would accept such offerings or whether reputable underwriters would feel

comfortable underwriting such offerings), available at https://financialservices.house.gov/uploadedfiles/hhrg113-ba16-wstate-jcoffee-20140409.pdf.

136

Certain transaction-based requirements would continue to apply to subsidiaries that rely on a parent’s Form S-3

eligibility to conduct offerings on Form S-3. See section II.A.2.c below for a discussion regarding Form S-3

eligibility for subsidiaries.

137

We also recognize that our proposed expansion of Form S-3 eligibility would provide more issuers that register

debt securities subject to the Trust Indenture Act of 1939 (“Trust Indenture Act”) [15 U.S.C. 77aaa et seq.]

(“subject debt securities”) with greater flexibility to comply with the Trust Indenture Act’s trustee qualification

requirements. The Trust Indenture Act requires an issuer that registers subject debt securities on Form S-1 to

file in the initial filing or a pre-effective amendment a trust indenture to be qualified and related trustee

statement of eligibility and qualification. Section 305(b)(2) of the Trust Indenture Act [15 U.S.C. 77eee(b)(2)],

however, permits the issuer to designate the trustee on a delayed basis for a shelf offering and, as a result, the

issuer may file the trustee statement of eligibility and qualification after the related registration statement, such

as a Form S-3, goes effective.

138

See supra notes 52-60 and accompanying text.

public float of $75 million or more to offer an unlimited amount of securities for cash on Form

S-3. As such, any issuer that meets the proposed registrant requirements would be eligible to use

Form S-3 for any primary or secondary offering of the issuer’s securities. 139 Each of the

proposed amendments is discussed, in turn, below. 140

a. Form S-3 Registrant Requirements

Exchange Act Reporting (One-Year Seasoning, Current,

and Timely Requirements)

We propose to eliminate the One-Year Seasoning requirement (which currently is in

General Instruction I.A.3(a)) that requires an issuer to have been an Exchange Act reporting

company for at least 12 calendar months prior to filing a Form S-3 because, as discussed in

section I.B above, we believe an investor’s ability to obtain issuer-specific information in

Exchange Act reports does not depend on the length of an issuer’s reporting history. Rather, the

ability to obtain such information depends on whether an issuer is current and timely with

139

As is currently the case, Form S-3 would not be available for exchange offers or business combination

transactions under the proposed amendments.

140

We are proposing various amendments to simplify and modernize Form S-3. First, we are proposing to amend

Item 9 and eliminate Item 12(a)(3) of Form S-3. Item 9 requires an issuer to “[f]urnish the information required

by Item 202 of Regulation S-K (§229.202 of this chapter), unless capital stock is to be registered and securities

of the same class are registered pursuant to Section 12 of the Exchange Act,” in which case an issuer must (in

accordance with Item 12(a)(3)) incorporate by reference “the description of such class of securities which is

contained in a registration statement filed under the Exchange Act, including any amendment or reports filed for

the purpose of updating such description.” We are proposing to eliminate Item 12(a)(3) and amend Item 9 to

specify that 17 CFR 229.202 (“Item 202 of Regulation S-K”) disclosure should be provided in response to that

item regardless of whether capital stock that is registered under section 12 of the Exchange Act is to be

registered on the form. We note that issuers could elect to incorporate by reference the information required by

Item 9 pursuant to Item 12(d). Item 12(d) currently permits an issuer to satisfy the disclosure requirements of

Items 3 through 11 to be incorporated by reference from documents filed pursuant to Section 13(a), 14, or 15(d)

of the Exchange Act. Second, we propose to amend Item 12(d) to also permit incorporation by reference from

any Securities Act or Exchange Act filing in order to give issuers greater flexibility to incorporate by reference

on Form S-3. Third, we also are proposing revisions to simplify Item 11(b) of Form S-3 by removing references

to specific filings that are required to be incorporated by reference for the purpose of including certain financial

statements required by that item. We do not believe it is necessary to specify the forms that need to be

incorporated by reference. Instead, we believe issuers should have the flexibility to incorporate the requisite

financial statements from any filing that is made with the Commission.

respect to its reporting obligations. Under the proposed amendments, an issuer would

immediately become eligible to use Form S-3 upon having a class of securities registered

pursuant to section 12(b) or 12(g), or becoming subject to section 15(d), of the Exchange Act. 141

Although we are proposing to eliminate the One-Year Seasoning requirement, we are

proposing to retain the Current and Timely in Exchange Act Reporting requirements. 142

Specifically, proposed General Instruction I.A.1.a would set forth the requirement that an issuer

be subject to the Exchange Act’s reporting requirements, and proposed General Instructions

I.A.1.b and c, respectively, would set forth the Current and Timely in Exchange Act Reporting

requirements. Accordingly, under the proposed amendments, Form S-3 eligibility would be

contingent on (among other things) an issuer being subject to the Exchange Act’s reporting

requirements and having timely filed all reports and other materials required to be filed under

sections 13(a), 14(a), 14(c), and 15(d) of the Exchange Act, other than specified reports on Form

8-K, during the preceding 12 calendar months and any portion of a month immediately preceding

the filing of a Form S-3, or, if an issuer had been subject to such requirements for less than 12

calendar months, during the time the issuer had been required to file such reports and

materials. 143

141

Thus, under the proposed amendments, an issuer could become an Exchange Act reporting company—for

example, by registering a class of equity securities on Form 10 under section 12(g) of the Exchange Act—and

then immediately conduct its first registered offering on Form S-3.

142

At least one observer has previously recommended that the Commission eliminate the timeliness requirement

altogether. See 2006 Report of the Advisory Committee on Smaller Public Companies, supra note 126.

143

The proposed amendments would codify the staff’s longstanding interpretation that for purposes of determining

whether a registrant has timely filed all reports required to be filed during the past twelve calendar months only

reports under section 13(a) or 15(d) of the Exchange Act and materials under sections 14(a) and 14(c) of the

Exchange Act, other than specified reports on Form 8-K, would be considered. As is the case currently, the

timeliness requirement would not apply to reports that are required solely pursuant to Item 1.01, 1.02, 1.04,

1.05, 2.03, 2.04, 2.05, 2.06, 4.02(a), or 5.02(e) of Form 8-K. We note that the Commission recently issued a

proposal that would allow registrants to elect to report on a semiannual basis on a new Form 10-S in lieu of

We continue to believe issuers must be current and timely with respect to their Exchange

Act reports at the time of filing a registration statement on Form S-3 because short-form and

shelf registration are premised on the availability of information about an issuer. 144 If an issuer is

not current in its Exchange Act reporting obligations, then the issuer-specific information that

may be needed to make an investment decision would not be available. Moreover, where

Exchange Act reports that are required to be incorporated by reference into a Form S-3 have not

been filed, the issuer likely would not be in compliance with section 10 of the Securities Act. 145

Further, we believe that conditioning Form S-3 eligibility on the timely filing of Exchange Act

reports establishes a compelling incentive for issuers to timely file their Exchange Act reports,

thereby helping ensure continuous availability of issuer-specific information even after the shelf

registration statement has become effective and in the period during which an issuer conducts its

offerings and at other times.

reporting quarterly on Form 10-Q. See Semiannual Reporting, Release No. 33-11414 (May 5, 2026) [91 FR

24968 (May 7, 2026)] (“Semiannual Reporting Proposal”). If that proposal is adopted, an issuer that elects to

file semiannually would be required to comply with the timeliness requirement with respect to its Form 10-S

filings rather than with respect to Form 10-Q filings. The staff position discussed in this footnote and any other

staff guidance, statements, or positions referenced in this release, represent the views of Commission staff and

are not a rule, regulation, or statement of the Commission. The Commission has neither approved nor

disapproved the views reflected in these staff positions or the content of these staff statements and, like all staff

positions or statements, they have no legal force or effect, do not alter or amend applicable law, and create no

new or additional obligations for any person.

144

See 1981 Reproposal at 41913 (stating that “Form S-3 eligibility criteria are based on the Commission’s belief

that information about companies using the form already is known or is so readily available that it need not be

repeated in a prospectus”).

145

See 15 U.S.C. 77j. We recognize that not all Exchange Act reports required to be filed during the 12 calendar

months preceding the filing of a Form S-3 are incorporated by reference into the Form S-3 and therefore are not

part of the prospectus. Item 12 of Form S-3 requires incorporation by reference of reports filed since the end of

the latest fiscal year for which a Form 10-K was required to be filed, which could be less than a 12-calendar

month period. For example, assume a calendar-year-end issuer files its Form 10-K for fiscal year end 2025 on

Mar. 3, 2026. If the issuer files a Form S-3 on Aug. 27, 2026, it would be required to incorporate by reference

all reports required to have been filed since Dec. 31, 2025, which would be less than a 12-calendar month

period. Nonetheless, we believe the 12-calendar month lookback period is appropriate because it helps ensure

that all information required to be incorporated by reference into the Form S-3 is timely filed and therefore

available to investors.

Consistent with the Commission staff’s current practice of not objecting to use of Form

S-3 when an untimely filing has been made under certain limited circumstances, we also propose

to amend the form’s instructions to provide that an issuer would remain Form S-3 eligible

notwithstanding an untimely filing having been made during the relevant lookback period so

long as: (a) the filing was made within seven calendar days of the original due date (where 17

CFR 240.12b-25 (“Rule 12b-25”) applies, the seven calendar days would be calculated from the

filing’s original due date and not from the end of the time period prescribed under Rule 12b25 146) and (b) the issuer made only one untimely filing during the relevant lookback period. 147

We want to encourage issuers to make their Exchange Act filings on a timely basis. At the same

time, however, we believe loss of Form S-3 eligibility can be a disproportionately harsh

consequence for a single untimely filing during a 12-month period. Accordingly, we propose to

permit issuers to remain Form S-3 eligible when the conditions described herein are satisfied.

We believe a seven-day period provides a reasonable amount of time to file the missed report or

other material while helping ensure investors receive necessary information within a reasonable

timeframe.

146

That is, if an issuer attempts to rely on Rule 12b-25 but is unable to comply with the requirements of that rule,

the seven calendar days would be calculated from the filing’s original due date and not from the end of the

period prescribed under Rule 12b-25. If, on the other hand, an issuer complies with Rule 12b-25 with respect to

a report, such report is deemed to be filed on the prescribed due date and, therefore, the issuer would not need to

rely on the seven-calendar-day grace period described in this section.

147

If the seventh calendar day falls on a Saturday, Sunday, or holiday, the report or other material would need to

have been filed no later than the first business day immediately following the Saturday, Sunday, or holiday.

Under General Instruction G.(3) of Form 10-K, a reporting issuer subject to the proxy rules may omit Part III

information from the Form 10-K if that information is included in the issuer’s proxy statement filed with the

Commission within 120 calendar days after the fiscal year end. This instruction treats the omitted Part III

information as timely filed on the Form 10-K due date. If the issuer fails to file this information with its proxy

statement or fails to amend its Form 10-K within 120 calendar days, the Form 10-K is considered untimely. The

proposed seven-day period would apply only to the original Form 10-K due date and not to the additional 120day period provided by General Instruction G.(3).

The One-Year Seasoning requirement may make registered offerings less attractive or

feasible for new Exchange Act reporting companies. Currently, such issuers must file a new

Securities Act registration statement on Form S-1 for any registered offerings conducted during

their first year of being an Exchange Act reporting company despite having already filed a

Securities Act or Exchange Act registration statement through which the issuer became an

Exchange Act reporting company that contained much of the same information that would be in

the new Form S-1. Further, these newly public companies cannot conduct shelf offerings,

making it difficult for them to take advantage of favorable market conditions to efficiently raise

capital from the public markets or to meet unexpected capital needs during this one-year period.

Eliminating the One-Year Seasoning requirement would allow issuers to use Form S-3 and

conduct shelf offerings immediately after becoming an Exchange Act reporting company. 148

We recognize that eliminating the One-Year Seasoning requirement may raise concerns

about extending Form S-3 eligibility to issuers without a demonstrated ability to comply with

their Exchange Act reporting obligations. Specifically, there may be a view that issuers are more

likely to become delinquent in their Exchange Act reporting obligations during their first year as

a reporting company and, therefore, they should not be able to use Form S-3 until they have

demonstrated an ability to comply with the Exchange Act. Despite these concerns, we do not

believe an initial seasoning period is necessary.

Consistent with the Commission’s longstanding approach, the essential aspect of Form S3 and shelf eligibility is whether requisite information about an issuer is available to investors at

148

To the extent issuers are engaged in a registered offering while contemplating a subsequent registered offering,

they should consider whether they have present disclosure obligations with respect to such subsequent offering.

For example, such issuers should consider the adequacy of their discussion of liquidity and capital resources

under 17 CFR 229.303(b)(1)(i) and (ii) of Regulation S-K, the disclosure regarding their intended use of

proceeds under 17 CFR 229.504 of Regulation S-K, and any other material effects that the subsequent

registered offering may have on the investors of the issuers.

the time they make an investment decision. Although there is a risk that an issuer without a

demonstrated ability to comply with its Exchange Act reporting obligations will become

delinquent in its reporting obligations while it has an effective registration statement on Form S3, we do not believe this possibility alone should preclude an issuer from filing a Form S-3 at a

time when it is otherwise eligible to do so as there are other investor protection measures in

place. 149 To the extent an issuer were to become delinquent before conducting a takedown from a

shelf registration statement, it would still have to assess whether the registration statement

contained all of the required information and whether the prospectus contained all information

required under the Securities Act. 150 Further, as discussed below, failure to provide the material

information required to be included in the registration statement would raise liability concerns

under the Federal securities laws. Our proposed prohibition of certain ineligible issuers from

using Form S-3, as discussed in section II.A.2.a.iv below, also may help address concerns about

the types of issuers that may pose a higher risk of non-compliance with their Exchange Act

reporting obligations.

149

We do not believe that satisfaction of an initial Exchange Act compliance period is premised on the notion that

an issuer’s historical compliance with its Exchange Act reporting obligations is indicative of, or provides a

degree of certainty regarding, future compliance.

150

Although we do not believe the risk of future non-compliance with Exchange Act reporting requirements

warrants retaining the One-Year Seasoning requirement for the reasons discussed above, we nevertheless

considered whether Form S-3 eligibility should be reassessed at the time of a takedown in addition to assessing

at the time of initial filing and related updates under section 10(a)(3) of the Securities Act to ensure issuers

remain current and timely (among the other Form S-3 eligibility requirements) at the time of a takedown. See 15

U.S.C. 77j(a)(3) (providing that “when a prospectus is used more than nine months after the effective date of

the registration statement, the information contained therein shall be as of a date not more than sixteen months

prior to such use, so far as such information is known to the user of such prospectus or can be furnished by such

user without unreasonable effort or expense”). We do not believe such reassessment is necessary or appropriate.

We believe the liability provisions of the Federal securities laws sufficiently incentivize issuers to conduct

takedowns only when in compliance with the form’s eligibility requirements and other requirements under the

Federal securities laws. In addition, we believe that adding a reassessment requirement at the time of each

takedown would impose an unnecessary burden on issuers and introduce unwarranted regulatory uncertainty.

Accordingly, we are not proposing to require reassessment at the time of a takedown, but we seek comment on

this issue. But see infra note 206 and accompanying text (noting that certain types of issuers would be

prohibited from using Form S-3 at any time they become such type of issuer).

Under the proposed amendments, some issuers using Form S-3 may have shorter

Exchange Act reporting histories than Form S-3 eligible issuers do today. Nonetheless, we do not

believe that such potential differences in issuers’ Exchange Act reporting histories would pose

heightened investor protection risks. As an initial matter, all Form S-3 issuers would be required

to incorporate by reference (or otherwise disclose) the same issuer-related information and

remain subject to the same liability standards as today. 151 For example, currently Item 12(a)(1) of

Form S-3 requires an issuer to incorporate by reference its latest annual report on Form 10-K that

contains audited financial statements for the registrant’s latest fiscal year for which a Form 10-K

was required to be filed and any Exchange Act reports filed since the end of such fiscal year.

Under the proposed amendments, an issuer that had not been required to file a Form 10-K since

becoming subject to section 13(a) or 15(d) of the Exchange Act would instead incorporate by

reference a Securities Act or Exchange Act filing that contains “Form 10 information” 152 with all

151

Issuers are (and would continue to be) required to include in a prospectus all information required by section

10(a) of the Securities Act and to ensure that such information is current in accordance with section 10(a)(3) of

the Securities Act. We propose to amend Item 12(b) of Form S-3, however, to eliminate the requirement for

forward incorporation by reference of proxy or information statements, or other material, filed under section 14

of the Exchange Act, as we believe it is unnecessary to incorporate such information beyond the extent to which

Part III information of Form 10-K is incorporated by reference from the proxy or information statement.

Because this Part III information is already incorporated by reference—either directly or indirectly—through

the Form 10-K, a separate requirement to incorporate all proxy materials under section 14 is unnecessary.

Notwithstanding 17 CFR 230.411(e) (“Rule 411(e)”), when an issuer incorporates by reference a Form 10-K

that itself incorporates by reference Part III information from a proxy or information statement within the

timeframe specified in General Instruction G.(3) of Form 10-K, we view the Part III information as incorporated

by reference into Form S-3. We also propose to remove the reference to section 13(c) in Item 12(b) for the

reasons discussed in section II.C.2 below. Further, we propose to amend Item 12(b) to require issuers to

explicitly state that all Exchange Act reports filed under sections 13(a) and 15(d) after the initial registration

statement is filed and before the termination of the offering are incorporated by reference into the prospectus.

This amendment would eliminate ambiguity and reduce the need for issuers to file pre‑effective amendments

solely to incorporate Exchange Act reports filed during the waiting period.

152

Under the proposed amendments, Item 12(a)(1) of Form S-3 would state that the term “Form 10 information”

means the information that is required by Form 10 to register under the Exchange Act each class of securities to

be registered on Form S-3. Item 12(a)(1) also would provide that a filing contains Form 10 information even if

it omits the information required by Item 202 of Regulation S-K with respect to a class of securities to be

registered on the form. We recognize that the filing that would otherwise serve as an issuer’s Form 10

financial statements required by Regulation S-X. In addition, issuers would be required to

provide “such further material information, if any, as may be necessary to make the required

statements, in the light of the circumstances under which they are made, not misleading.” 153

Under Item 11(a) of Form S-3 (as revised by the proposed amendments), issuers also would be

required to describe any and all material changes in the issuer’s affairs which have occurred

since the end of the most recent fiscal year covered by the audited annual financial statements

required to be included in the registration statement pursuant to Item 12(a)(1) that have not been

described in a filing incorporated by reference into the registration statement. Further, to the

extent an issuer had not yet been required to file a Form 10-K, Commission staff would have had

the opportunity to review the information disclosed in the Securities Act or Exchange Act

registration statement through which the issuer became an Exchange Act reporting company and

which would be incorporated by reference into the prospectus.

Finally, other requirements under the Federal securities laws are designed to ensure

investors are adequately protected and receive the information necessary to make an informed

investment decision in connection with a registered securities offering. For example, under the

Securities Act, anyone who acquires an issuer’s securities in a registered offering has a private

information may, in some cases, not include the information required by Item 202 of Regulation S-K—which is

a disclosure requirement of Form 10—with respect to each class of securities to be registered on Form S-3. For

example, an issuer might register common stock in an IPO on Form S-1 and later register the offer and sale of a

different class of securities, such as debt, on Form S-3. The Form S-1 would not include the disclosure required

by Item 202 of Regulation S-K for the debt securities and, therefore, the Form 10 information would be

incomplete with respect to those securities. As such, we are proposing to carve out the information required by

Item 202 of Regulation S-K from Item 12(a)(1) of Form S-3 to address any potential confusion as to whether

the Form S-1 (or other Securities Act or Exchange Act filing) in those circumstances would satisfy the

requirement to provide Form 10 information because it excludes the relevant information required by Item 202

of Regulation S-K. Although the information required by Item 202 of Regulation S-K would not need to be

included in the Securities Act or Exchange Act filing that serves as the Form 10 information for purposes of

Item 12(a)(1), this information would have to be incorporated by reference from another filing or included

directly in the prospectus in order to satisfy the disclosure requirements of Item 9 of Form S-3.

153

17 CFR 230.408.

right of action under section 11 and a purchaser has a private right of action under section

12(a)(2). Section 11 liability exists for untrue statements of material fact or omissions of material

facts required to be included in a registration statement or necessary to make the statements in

the registration statement not misleading at the time the registration statement became

effective. 154 Importantly, underwriters, experts such as accountants, an issuer’s directors, and

other signatories can be held strictly liable for material misstatements or omissions; 155 thus, these

parties are incentivized to ensure an issuer’s disclosures are free of material misstatements or

omissions, thereby helping to protect investors. 156 Under section 12(a)(2), sellers have liability to

purchasers for offers or sales by means of a prospectus or oral communication that includes an

untrue statement of material fact or omits to state a material fact necessary to make the

statements made, based on the circumstances under which they were made, not misleading.

Moreover, section 17(a) of the Securities Act provides, among other things, that it shall be

unlawful for any person in the offer or sale of a security to obtain money or property by means of

154

Under Rule 430B, for a prospectus supplement required to be filed in connection with a takedown of securities

pursuant to 17 CFR 230.424(b)(2) (“Rule 424(b)(2)”), 17 CFR 230.424(b)(5) (“Rule 424(b)(5)”), or 17 CFR

230.424(b)(7) (“Rule 424(b)(7)”), all information in that prospectus supplement will be deemed part of and

included in the registration statement as of the earlier of the date it is first used or the date and time of the first

contract of sale of securities in the offering to which the prospectus supplement relates.

155

For outside directors, liability is proportional to fault, but for all other parties, liability is generally joint and

several. See 15 U.S.C. 77k(f).

156

These parties may assert a “due diligence” defense, provided the defendant “had, after reasonable investigation,

reasonable ground to believe and did believe, at the time such part of the registration statement became

effective, that the statements therein were true and that there was no omission to state a material fact required to

be stated therein or necessary to make the statements therein not misleading.” 15 U.S.C. 77(k)(b)(3). Some

courts have held that section 11 defendants asserting the due diligence defense of reasonable investigation must

carry the burden of proof that they acted with the requisite diligence and the bar for asserting the due diligence

defense may be high and highly fact-specific. See, e.g., In re WorldCom, Inc. Sec. Litig., 346 F. Supp. 2d 628,

662 (S.D.N.Y. 2004) (“Underwriters must exercise a high degree of care in investigation and independent

verification of the company’s representations. Overall, no greater reliance in our self-regulatory system is

placed on any single participant in the issuance of securities than upon the underwriter. Underwriters function

as ‘the first line of defense’ with respect to material misrepresentations and omissions in registration statements.

As a consequence, courts must be particularly scrupulous in examining their conduct.” (internal quotation marks

omitted)).

any untrue statement of a material fact or any omission to state a material fact necessary to make

the statements made, in light of the circumstances under which they were made, not misleading.

Thus, to the extent that there may be a higher risk of delinquency by issuers with shorter

Exchange Act reporting histories, and less historical information for investors to review when an

issuer has been subject to the Exchange Act’s reporting requirements for a shorter period of time,

the Federal securities laws generally require that issuers provide investors with information about

an issuer that is necessary to make an informed investment decision and provide remedies to

investors when these disclosure standards are not satisfied. We believe that investors will

continue to be protected by these liability provisions of the Federal securities laws and receive

material information even in the absence of an initial Exchange Act seasoning requirement.

For these reasons, we propose to eliminate the One-Year Seasoning requirement.

Request for Comment

1. We are proposing to eliminate the One-Year Seasoning requirement in General Instruction

I.A.3(a) that requires an issuer to have been an Exchange Act reporting company for at least

12 calendar months before becoming eligible to use Form S-3. Should we adopt the

amendment as proposed? If not, please explain why the One-Year Seasoning requirement is

necessary.

2. Instead of eliminating the One-Year Seasoning requirement altogether, should we shorten the

required seasoning period? If yes, what would be an appropriate seasoning period and why?

3. Notwithstanding the proposal to eliminate the One-Year Seasoning requirement, we are

proposing to require issuers to be subject to the Exchange Act’s reporting requirements and

current and timely in their Exchange Act reporting obligations during the 12 calendar months

(or such shorter period that the issuer has been subject to the Exchange Act’s reporting

requirements) and any portion of a month immediately preceding the filing of a Form S-3.

Should we retain these requirements as proposed?

4. As discussed in section II.A.2.a.i and footnote 148 above, the proposed amendments would

allow issuers to use Form S-3 and conduct shelf offerings immediately after becoming an

Exchange Act reporting company. Would this aspect of the proposed amendments alter

market practice with respect to initial public offerings (“IPOs”)? For example, would the

proposed amendments affect the need for, or use of, an overallotment option (i.e.,

“greenshoe”), given the proposed ability to use Form S-3 for follow-on primary offerings

after the completion of the IPO? If so, are there any investor protection concerns resulting

from such a change in market practice? Would the proposed amendments affect how issuers

choose to go public? For example, would the proposed ability to use Form S-3 for shelf

offerings immediately after becoming a reporting company affect the extent to which direct

listings would be used by companies as a means of going public?

5. As discussed in footnote 55, Form S-3 currently requires (and under the proposed

amendments, would continue to require) an issuer to have been timely in its Exchange Act

reports “during the twelve calendar months and any portion of a month immediately

preceding the filing of the registration statement.” Should we revise this standard to instead

require only a 12-month (or one-year) lookback? Under this alternative approach, an issuer

intending to file a Form S-3 on July 19, 2026, for example, would need to have been current

and timely in its Exchange Act filings—other than specified Form 8-K reports—from July

19, 2025 through July 19, 2026 (rather than from July 1, 2025 through July 19, 2026). Why

or why not?

6. We are proposing to amend Form S-3’s instructions to provide that an issuer would remain

eligible to use the form notwithstanding an untimely filing having been made during the

relevant lookback period so long as: (a) the filing was made within seven calendar days of

the original due date and (b) the issuer had only one untimely filing during the relevant

lookback period. Should we adopt the amendment as proposed? Would a shorter or longer

period than seven calendar days be appropriate? For example, should the period be 10

business days rather than seven calendar days? Are there other conditions that we should

include in this proposed instruction?

7. Under the proposed amendments, an issuer would be required to be subject to the Exchange

Act’s reporting requirements. Should issuers that voluntarily comply with the reporting

requirements of section 13(a) or 15(d) be eligible to use Form S-3 if they have filed all

reports and materials that would otherwise be required of an issuer subject to the Exchange

Act’s reporting requirements?

8. Should we amend our rules to require reassessing of Form S-3 eligibility each time an issuer

conducts a shelf takedown to help ensure issuers remain current and timely and investors

have available all required information at the time they make an investment decision?

9. Under the proposed amendments to Item 12(a)(1) of Form S-3, an issuer that was not yet

required to file a Form 10-K since becoming subject to section 13(a) or 15(d) of the

Exchange Act would instead have to incorporate by reference a Securities Act or Exchange

Act filing that contains Form 10 information with respect to each class of securities to be

registered on Form S-3. The term “Form 10 information” would be defined as the

information required by Form 10 to register under the Exchange Act each class of securities

to be registered on the Form S-3. The proposed amendments also would provide that a filing

contains Form 10 information even if it omits the information required by Item 202 of

Regulation S-K with respect to a class of securities registered on this Form. Should we adopt

the amendments as proposed? Is it necessary to specify that the Form 10 information need

not include the information required by Item 202 of Regulation S-K? Should similar

treatment be permitted for other Form 10 disclosure requirements? Why or why not?

10. We propose to amend Item 12(b) of Form S-3 to eliminate the requirement for forward

incorporation by reference of proxy or information statements, or other material, filed under

section 14(a) or 14(c) of the Exchange Act. We also propose to eliminate Item 12(b)’s

reference to section 13(c) of the Exchange Act. Should we adopt the amendments as

proposed?

11. We propose to amend Item 12(b) of Form S-3, consistent with prior staff guidance, to clarify

that all Exchange Act reports filed pursuant to sections 13(a) and 15(d) “after the date of

filing the initial registration statement and prior to the termination of the offering” would be

deemed to be incorporated by reference into the prospectus. Should we adopt the amendment

as proposed?

12. We propose to amend Item 12(d) of Form S-3, which currently permits the information

required in response to Items 3 through 11 of the form to be incorporated by reference from

filings made pursuant to section 13(a), 14, or 15(d) of the Exchange Act, to permit such

information to be incorporated from any Securities Act or Exchange Act filing. Should we

adopt the amendment as proposed?

ii.

Certain Failures to Make Payments and Defaults

We propose to eliminate the “Certain Failures to Make Payments and Defaults”

requirement for Form S-3 eligibility. As explained in section II.A.1 above, the Commission

initially conditioned short-form registration on satisfaction of certain factors addressing the

“quality” of the issuer, among other requirements. Over time, however, the Commission reduced

or eliminated certain of those requirements. 157 In 1982, when the Commission adopted Form S-3,

it kept the Certain Failures to Make Payments and Defaults requirement from Form S-7 without

explanation. 158 The Commission had previously expressed the view that qualitative requirements

are not appropriate criteria for short-form eligibility. 159 Specifically, in 1981, after seeking

comment on whether to prohibit issuers that were “financially troubled” from using Form S-2,

the Commission explained that “the use of tests measuring the ‘quality of a registrant’ . . . is

inconsistent with the basic precept of registrant classification under Forms S-3, S-2, and S-1,

namely, the extent information about a registrant has been disseminated in the marketplace and

the accuracy of such information.” 160 We believe that eliminating this criterion is consistent with

the Commission’s prior statement.

We agree with the Commission’s 1981 statement and, therefore, are proposing that Form

S-3 eligibility no longer be conditioned on an issuer satisfying the Certain Failures to Make

Payments and Defaults requirement. We view that requirement as the type of qualitative measure

the Commission previously deemed inappropriate. In our view, such criteria are inconsistent with

the principle of short-form registration, and Form S-3 eligibility should instead focus on an

issuer’s status as a current and timely Exchange Act reporting company.

157

See supra section II.A.1.b.

158

See Integrated Disclosure Adopting Release.

159

See 1981 Reproposal.

160

1981 Reproposal at 41912. The Commission also stated its intention to “markedly reduce[ ] or eliminate[ ] those

criteria relating to the ‘quality’ of the registrant, and premise[ ] eligibility generally on dissemination of

information in the market place, as represented by the length and nature of compliance by the company with the

reporting requirements of the Exchange Act, and, with respect to proposed Form S-3, on the registrant’s float.”

Id. at 41904; see also id. at 41905 (“[T]he Commission has made a concerted effort to revise the eligibility

requirements in a manner that is simple and rational and is consistent with its intention to classify registrants on

the basis of the degree of information disseminated and analyzed in the marketplace.”).

We also believe a specific eligibility requirement in Form S-3 related to defaults on

financial obligations is unnecessary because the Commission’s disclosure requirements should

provide investors with the information necessary to evaluate an issuer’s financial health. For

example, issuers are required to provide financial statements covering a minimum of two fiscal

years 161 and to accompany such financial statements with management’s discussion and analysis

that “provide[s] material information relevant to an assessment of the financial condition and

results of operations of the registrant including an evaluation of the amounts and certainty of

cash flows from operations and from outside sources.” 162 Issuers also are required to file a Form

8-K within four business days of certain types of defaults, including specified defaults in

connection with various off-balance sheet arrangements. 163 In addition, issuers must disclose

information about dividends paid on preferred stock (and other equity securities) as well as

certain default-related matters, including defaults in principal, interest, sinking fund provisions,

or redemption provisions with respect to any issue of securities or credit agreements, or any

breach of covenant of a related indenture or agreement. 164 Accordingly, investors should have

the information necessary about an issuer’s financial condition, including defaults, to make an

informed investment decision with respect to offerings conducted by that issuer pursuant to Form

S-3, making the Certain Failures to Make Payments and Defaults requirement superfluous.

Request for Comment

13. Should the Commission eliminate the Certain Failures to Make Payments and Defaults

requirement, as proposed? If not, please explain why.

161

See 17 CFR 210.3-01; 17 CFR 210.3-02; 17 CFR 210.3-04; 17 CFR 210.8-02.

162

17 CFR 229.303(a).

163

See Form 8-K, Item 2.04.

164

17 CFR 210.4-08.

iii.

Electronic Filings and Interactive Data Files

We propose to eliminate the Electronic Filings and Interactive Data Files requirements.

General Instruction I.A.7(a) conditions Form S-3 eligibility on an issuer having “[f]iled with the

Commission all required electronic filings.” This provision was added to Form S-3 in connection

with EDGAR’s implementation in 1993, which required issuers to file their registration

statements and reports electronically on EDGAR. 165 General Instruction I.A.7(b) requires an

issuer to have “[s]ubmitted electronically to the Commission all Interactive Data Files required

to be submitted pursuant to [17 CFR 232.405] . . . during the twelve calendar months and any

portion of a month immediately preceding the filing of the registration statement on this Form.”

This provision was added to Form S-3 in connection with the Commission’s initial adoption of

the Interactive Data File requirements in 2009. 166 Each of these provisions appears to have been

added to the registrant requirements of Form S-3 to incentivize compliance with newly adopted

Commission rules; specifically, the transition from paper to electronic filings and the

requirement to provide structured data in an Interactive Data File for the first time. 167

We are proposing to eliminate these registrant requirements because we believe they are

no longer necessary. While the electronic filing provision may have helped encourage issuers

who had been accustomed to making their filings in paper to instead make their filings

electronically when EDGAR was first introduced more than 30 years ago, we believe issuers are

now fully accustomed to the electronic filing process, and we are not aware of issuers commonly

165

See 1993 EDGAR Adopting Release.

166

See Interactive Data to Improve Financial Reporting, Release No. 33-9002 (Jan. 30, 2009) [74 FR 6776 (Feb.

10, 2009)] (“Interactive Data Adopting Release”).

167

The term “structured data” generally refers to data that is tagged to make it machine-readable, facilitating its use

by investors and other market participants, such as data aggregators (i.e., entities that, in general, collect,

package, and resell data).

attempting to submit mandated electronic filings in paper. Today, all companies must make their

Commission filings electronically through EDGAR, and mandated electronic filings are not

accepted in paper form, absent a hardship exemption. 168 In addition, a mandated electronic

Exchange Act report that was submitted in paper would not be considered to have been filed with

the Commission unless a hardship exemption applied; if resubmitted electronically after the

requisite deadline, such material would be untimely, and the issuer may be ineligible to use Form

S-3. 169 For these reasons, we believe the electronic filing provision in General Instruction

I.A.7(a) is no longer necessary as a condition to Form S-3 eligibility.170

We also believe that the Interactive Data File provision is no longer necessary to induce

compliance with the Commission’s Interactive Data File requirements. Since 2009, the

Commission’s rules have required companies to provide the information from the financial

statements in their registration statements and periodic and current reports in structured format

using eXtensible Business Reporting Language (“XBRL”). 171 In 2018, the Commission began

requiring the use of Inline XBRL for financial statement information. 172 Subsequently, the

Commission has required additional disclosures to be made using XBRL and Inline

168

See 17 CFR 232.100 mandating electronic filing and 17 CFR 232.201 and 202 relating to temporary and

continuing hardship exemptions.

169

As indicated above, we are retaining the requirement that an issuer must have timely filed all the material

required to be filed pursuant to sections 13(a), 14(a), 14(c), and 15(d) of the Exchange Act during the preceding

12 calendar months (or such shorter period that the issuer was required to file such reports and materials), other

than specified reports on Form 8-K.

170

At this time, however, we are not proposing a corollary amendment to General Instruction A.3(a) of Form S-8,

which contains the same electronic filing provision as General Instruction 1.A.7(a) of Form S-3.

171

See Interactive Data Adopting Release.

172

See Inline XBRL Filing of Tagged Data, Release No. 33-10514 (Aug. 16, 2018) [83 FR 40846 (Aug. 16, 2018)].

Whereas previously filers generated an HTML document of their financial statement information or risk/return

summary information and then tagged a copy of the data to create a separate XBRL exhibit, Inline XBRL

allows filers to prepare a single document that is both human-readable and machine-readable.

XBRL. 173 We believe issuers are now sufficiently accustomed to complying with the

Commission’s Interactive Data File requirements such that conditioning Form S-3 eligibility on

compliance with these requirements is no longer necessary. Accordingly, we propose to

eliminate this Form S-3 eligibility requirement. 174

Request for Comment

14. We are proposing to eliminate the registrant requirements in General Instruction I.A.7 of

Form S-3 that require an issuer to have filed with the Commission all electronic filings and

Interactive Data Files. Should we adopt the amendments as proposed? If not, please explain

why.

iv.

Prohibition on Use of Form S-3 by Certain Ineligible

Issuers

Although the proposed amendments would extend the benefits of Form S-3 and shelf

registration to a broader group of issuers, we seek to do so only to the extent the amendments are

consistent with investor protection. We do not believe it is appropriate to expand Form S-3

eligibility to certain categories of issuers that may pose greater potential for non-compliance with

the Federal securities laws. Accordingly, in addition to conditioning Form S-3 eligibility on an

issuer being an Exchange Act reporting issuer that is current and timely with respect to its

Exchange Act filings, the proposed amendments also would prohibit certain “ineligible issuers,”

173

See, e.g., Holding Foreign Companies Accountable Act Disclosure, Release No. 34-93701 (Dec. 2, 2021) [86

FR 70027 (Dec. 9, 2021)]; Filing Fee Disclosure and Payment Methods Modernization, Release No. 33-10997

(Oct. 13, 2021) [86 FR 70166 (Dec. 9, 2021)]; FAST Act Adopting Release. More recently, the Commission

has adopted additional disclosures requirements subject to XBRL and Inline XBRL. See, e.g., Insider Trading

Arrangements and Related Disclosures, Release No. 33-11138 (Dec. 14, 2022) [87 FR 80362 (Dec. 29, 2022)];

Pay Versus Performance, Release 34-95607 (Aug. 25, 2022) [87 FR 55134 (Sept. 8, 2022)].

174

At this time, we are not proposing corollary amendments to 17 CFR 230.144(c)(1)(ii) and General Instruction

A.3(b) of Form S-8, which require an issuer to have submitted every Interactive Data File required to be

submitted pursuant to 17 CFR 232.405.

as defined in Rule 405, from using the form. 175 Under proposed new General Instruction I.A.2

(which would be titled “Prohibition on Use of Form S-3 by Certain Ineligible Issuers”), an issuer

would not be eligible to use Form S-3 if:

•

The issuer is a “BSP issuer,” which the proposed amendments would define in Rule 405

as an issuer that is, or during the past three years the issuer or any of its predecessors was:

(1) a blank check company as defined in 17 CFR 230.419(a)(2) (“Rule 419(a)(2)”); 176 (2)

a shell company, other than a business combination related shell company, each as

defined in Rule 405, 177 provided, however, that an issuer, other than a foreign private

issuer, as defined in Rule 405, 178 would not be deemed to be a shell company solely

175

See proposed General Instruction I.A.2 to Form S-3. Under paragraph (2) of the definition of “ineligible issuer”

in Rule 405, the Commission may grant waivers of ineligible issuer status “upon a showing of good cause, that

it is not necessary under the circumstances that the issuer be considered an ineligible issuer.” 17 CFR 230.405;

see also Revised Statement on Well-Known Seasoned Issuer Waivers, Division of Corporation Finance, U.S.

Sec. & Exch. Comm’n (Apr. 24, 2014), available at https://www.sec.gov/about/divisions-offices/divisioncorporation-finance/revised-statement-well-known-seasoned-issuer-waivers-april-24-2014 (elaborating on

application of good cause standard). The Commission has delegated the authority to act on such applications to

the Director of the Division of Corporation Finance. See 17 CFR 200.30-1(a)(10). Issuers that obtain such

waivers would be able to use Form S-3 assuming they meet all other requirements of the form. We recognize

that the number of waiver requests could increase due to the proposed amendments. We seek comment on

whether issuers should be permitted to request such waivers for purposes of establishing Form S-3 eligibility.

176

See 17 CFR 230.419(a)(2) (defining “blank check company” as a company that (i) is a development stage

company that has no specific business plan or purpose or has indicated that its business plan is to engage in a

merger or acquisition with an unidentified company or companies, or other entity or person and (ii) is issuing

penny stock).

177

See 17 CFR 230.405 (defining “shell company” as a registrant, other than an asset-backed issuer, that has (1) no

or nominal operations and (2) either (i) no or nominal assets, (ii) assets consisting solely of cash and cash

equivalents, or (iii) assets consisting of any amount of cash and cash equivalents and nominal other assets, and

defining “business combination related shell company” as a shell company that is (1) formed by an entity that is

not a shell company solely for the purpose of changing the corporate domicile of that entity solely within the

United States or (2) formed by an entity that is not a shell company solely for the purpose of completing a

business combination transaction among one or more entities other than the shell company, none of which is a

shell company).

178

In light of the Commission’s 2025 concept release, which solicits public comment on whether the current FPI

definition appropriately balances the protection of investors with the promotion of capital formation, we are not

proposing to amend the three-year lookback on shell company status for foreign private issuers. As a result, an

FPI that was a SPAC during the past three years would not be eligible to be a WKSI. See Concept Release on

Foreign Private Issuer Eligibility, Release No. 33-11376 (June 4, 2025) [90 FR 24232 (June 9, 2025)] (“FPI

Concept Release”).

because during the past three years either the issuer or any of its predecessors was a

“special purpose acquisition company (SPAC),” as defined in 17 CFR 229.1601(b)

(“Item 1601 of Regulation S-K”); 179 or (3) an issuer in an offering of penny stock as

defined in 17 CFR 240.3a51-1; 180

•

Within the past three years, the issuer or any entity that at the time was a subsidiary 181 of

the issuer was convicted of any felony or misdemeanor described in paragraphs (i)

through (iv) of section 15(b)(4)(B) of the Exchange Act; 182

179

See 17 CFR 229.1601(b) (defining a “special purpose acquisition company (SPAC)” as a company that has: (1)

indicated that its business plan is to: (i) conduct a primary offering of securities that is not subject to the

requirements of 17 CFR 230.419 (“Rule 419”); (ii) complete a business combination, such as a merger,

consolidation, exchange of securities, acquisition of assets, reorganization, or similar transaction, with one or

more target companies within a specified time frame; and (iii) return proceeds from the offering and any

concurrent offering (if such offering or concurrent offering intends to raise proceeds) to its security holders if

the company does not complete a business combination, such as a merger, consolidation, exchange of securities,

acquisition of assets, reorganization, or similar transaction, with one or more target companies within the

specified time frame; or (2) represented that it pursues or will pursue a special purpose acquisition company

strategy).

180

See 17 CFR 240.3a51-1 (setting forth a detailed definition of the term “penny stock”). The acronym “BSP” in

this context is intended to refer to “blank check companies,” “shell companies,” and “penny stock issuers.” The

proposed definition of “BSP issuer” generally conforms to the requirement in paragraph (1)(ii) of the definition

of “ineligible issuer” in Rule 405, except that it excludes issuers that previously were (or whose predecessors

were) “special purpose acquisition companies (SPACs),” as defined in Item 1601 of Regulation S-K. We

discuss our basis for excluding SPACs from the proposed definition of “BSP issuer” below. See infra text

accompanying notes 194-196. We are proposing to define the term “BSP issuer” in part because several of our

current rules (and proposed amendments) refer to the three categories of issuers encom

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