Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
REGISTRATION | | | |
SEC Review | No prior review, unless extraordinary transaction | Same as Full Company Registration | Potential review upon filing of registration statement or post-effective amendment to registration statement (PE); no prior review upon takedown unless file PE |
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Filing Fee | Nominal upfront fee; pay as you go | Same as Full Company Registration | Upfront fee based on entire dollar amount registered |
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Updating | Incorporate by reference all Exchange Act reports | Same as Full Company Registration | Same as Full Company Registration |
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Limitations on Type/Amount of Securities to be Registered | None; need only list in Form C-1 classes of securities to be registered; no dollar amount need be specified in original registration statement | Same as Full Company Registration | Dollar amount reasonably expect to issue within 2 years; equity issued in at the market offering may not exceed 10% public float |
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Procedure for adding additional type of security/additional dollar amount to registration statement | Form C-1 would cover all securities the issuer has authority to issue in an indefinite amount | Same as Full Company Registration | Currently prohibited; new registration statement required; possibility of review upon filing new registration statement |
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Distribution Method | No restrictions | Same as Full Company Registration | For equity, must be either a fixed price offering, or if an at the market offering, must be in an amount less than 10% of public float and sold through an underwriter |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
ELIGIBILITY | | | |
Reporting History | Two years | Same as Full Company Registration | One year |
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Public Float Requirement | $75 million | Same as Full Company Registration | $75 million, unless offering of non-convertible investment grade securities and certain other instances (in which case no minimum public float required) |
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Exchange Listing/NMS | Required | Same as Full Company Registration | Not required |
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Mandatory Disclosure Enhancements (Top Mgt Certifs, Mgt Report to Audit Cmtee; Expanded and Accelerated 8-K; Risk Factors in 10-K) | Required | Same as Full Company Registration | Not required |
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Foreign Issuers Eligible? | Not eligible for pilot unless undertake to file same Exchange Act reports and satisfy same disclosure requirements as domestic issuers (although Commission should consider whether current foreign filings would be sufficient) | Same as Full Company Registration | Eligibility standards same as for domestic issuers, with added requirement that a 20-F/10-K has been filed with the SEC |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
EXEMPTIONS FROM REGISTRATION | | | |
Exempt Transactions - General | Not allowed unless involves non-convertible debt sold to institutions; all equity securities (which includes equity equivalents (e.g., warrants, convertible debt)) are registered and freely tradeable by nonaffiliates; | Same as Current Universal Shelf, except that if issuer wishes to register but is not able to make public disclosure of material information, may do limited placement of securities to accredited investors as long as disclose information to such investors | Allowed but securities are restricted by regulation; not freely tradeable absent registration or a valid exemption from registration |
| if issuer is not able to make public disclosure of material information, may do limited placement of securities to accredited investors as long as disclose information to such investor and contractually restrict resale until information made public | and contractually restrict resale until information made public | |
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Securities Act Metaphysics Involving Equity Securities | Virtually eliminated since all equity securities are deemed registered and all other securities may be deemed registered; no need for most resale restrictions | Although issuer still able to do private placements of equity securities, incentives to do exempt offerings minimized | Not eliminated since issuers still conduct private placements of equity securities |
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OFFSHORE SALES/RESALES | Offshore sales of securities may take place outside the Form C-1; flowback of securities placed offshore are registered on Form C-1 (fee is calculated by reasonably estimating amount of securities likely to flow back within statutory period) | Same as Full Company Registration, except flowback not required to be registered on Form C-1; resales into the U.S. may not take place absent registration or valid exemption (same as Current Universal Shelf) | Offshore sales of securities may take place under Regulation S safe harbor; resales into the U.S. may not take place absent registration or valid exemption |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
TRANSACTIONAL DISCLOSURE | | | |
Requirement for Prior Notice/Public Filing of Registration Statement and Amendments Thereto | C-1 generically registers all types of securities without specifying quantity or dollar amount; upon takedown, specify dollar amount and type of securities to be offered and pay fee; | Same as Full Company Registration | Shelf registration statement filed specifying types of securities and total dollar amount registered; PE required only if Section 10(a)(3) update, fundamental change, or change in plan of distribution, |
| filing of transactional information generally would not trigger a PE unless extraordinary transaction; if non-de minimis equity offering, MUST file Form 8-K with transactional/material developments information no later than date of first sale; | | but first two can be satisfied through incorporation by reference; no other notice or public filing required prior to takedown; transactional/material developments info filed after takedown (and after delivery to investors) in prospectus supplement; |
| if de minimis equity offering or non-convertible debt offering, MAY file Form 8-K with transactional/material developments information if elect to use incorporation by reference method of prospectus delivery; | | NOTE: Committee recommends that the Commission require filing of Form 8-K with transactional/material developments info for non-de minimis equity or equity equivalent offering off universal shelf under same conditions as Full Company Registration |
| otherwise, such information filed in prospectus supplement at same time delivered to investors; | | |
| if file material developments information on Form 8-K rather than deliver, must file Form 8-K in a sufficient time in advance of offering so that market can react to information before a sale can occur | | |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
TRANSACTIONAL DISCLOSURE (cont'd) | | | |
Prospectus Delivery - General | Physical prospectus delivery is required for nonaccredited investors in nonroutine or extraordinary transactions only, or for security specific disclosure if new security; | Same as Full Company Registration | Prospectus supplement containing transactional/material developments disclosure must be physically delivered to investors at least two business days after the earlier of pricing or first use; |
| otherwise, prospectus may be physically delivered, or information constituting the prospectus may be incorporated by reference into the confirm or other document delivered to investors | | delivery of transactional/material developments info through incorporation by reference not permitted |
| | | NOTE: Committee recommends that the Commission require filing of 8-K with transactional/material developments info for non-de minimis equity or equity equivalent offering under same conditions as Full Company Registration even if info actually delivered |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
AFFILIATES AND STATUTORY UNDERWRITERS | | | |
Resales by Affiliates | All affiliate resales deemed registered under Form C-1unless sold under Rule 144; | Same as Current Universal Shelf, except that affiliate resales could be registered on Form C-1 | Issuer may register resale for affiliate on shelf registration statement or any other registration statement (fee paid upfront); or affiliate may resell under Rule 144, in a private placement, or in an offshore placement; |
| affiliates that would be subject to resale limitations would be only those affiliates who are holders of 20% voting power; holders of 10% voting power w/ board seat; their reps; CEO; and inside directors; | | affiliates subject to these limitations include all persons defined as affiliates |
| presumption rebuttable for 20%/10% with board seat | | |
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Resales of Affiliates of Acquired Companies | No resale limitations unless fit within category above | Same as Current Universal Shelf | Affiliates of acquired companies receiving registered acquiror securities subject to resale limitations |
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Statutory Underwriter | Limited to broker-dealers acting on behalf of issuer or affiliate in distribution | Not limited | Not limited |
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Item | Full Company Registration | Modified Company Registration | Current Universal Shelf |
LIABILITY | | | |
Section 11 "strict" liability | Applies to all information in Form C-1 when filed, all information in any PE to the Form C-1, and all Exchange Act reports incorporated by reference; | Same as Full Company Registration | Applies to all info in registration statement when declared effective, all info in any PE to registration statement, and all Exchange Act reports incorporated by reference; |
| would apply to all transactional/material developments info mandatorily filed on Form 8-K (non-de minimis equity offering) OR voluntarily filed on Form 8-K for purposes of using incorporation by reference method of prospectus delivery | | does not apply to transactional/material developments info contained in prospectus supplement upon takedown |
| (de minimis equity offerings and non-convertible debt offerings) | | NOTE: Committee recommends that the Commission require filing of 8-K with transactional/material developments info for non-de minimis equity offering under same conditions as Full Company Registration thereby attaching Section 11 liability to this info |
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Section 12(a)(2) liability | Applies to all information in document used as prospectus whether document deemed prospectus through incorporation by reference method of prospectus delivery (e.g., confirm or selling materials), or traditional prospectus with prospectus supplement | Same as Full Company Registration | Applies to all information in traditional prospectus with prospectus supplement; does not attach to other selling materials (antifraud liability only) |