Expanding WKSI Eligibility Act

Key Points

• This bill, introduced by Senator McCormick, makes it easier for mid-sized companies to qualify as "well-known seasoned issuers." This special status allows companies to sell stocks and bonds to the public much faster and with less paperwork.
• Currently, a company usually needs $700 million in stock held by public investors to get this status. This bill would lower that requirement to $400 million, allowing more companies to skip certain waiting periods when they want to raise money from the public.
• By reaching this status, companies can use a process that lets them keep a plan to sell stocks on file and use it whenever they need cash, rather than waiting for the Securities and Exchange Commission (SEC) to review every single sale.
• The bill also requires the SEC to publish a yearly report on how many companies tried and failed to get special permission to use these rules. This helps the public see how many companies are struggling to meet the requirements for these privileges.
• This change is intended to help mid-sized businesses grow by giving them the same flexible tools to raise money that only the largest corporations currently enjoy.

Impact Analysis

Govbase has not yet run an impact analysis on this legislation.