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New SEC Regulatory Initiatives to Reduce Disclosure Obligations and Promote Capital Formation

Simplified Filings Under Form S-K and Form S-X; New Smaller Reporting Company Thresholds; Amended Rule 701

Recording of a 90-minute premium CLE webinar with Q&A

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Conducted on Wednesday, November 28, 2018

Recorded event now available

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This CLE course will examine recent initiatives by Congress and the SEC to encourage capital formation and reduce disclosure requirements for public and private issuers. The panel discussion will include simplification of disclosure requirements under Regulation S-K and Regulation S-X, the new definition of “smaller reporting company,” amendment of Rule 701 to allow more companies to issue stock as compensation without disclosure to investors, and the JOBS and Investor Confidence Act of 2018.


Recent actions by the SEC and Congress indicate a concerted effort to ease the disclosure obligations of public companies and encourage capital formation by smaller and emerging growth companies. Securities counsel must prepare to advise issuers of all types and sizes on taking advantage of these significant amendments to the regulations.

On Aug. 17, 2018, the SEC adopted amendments to simplify and update the disclosure requirements outlined in Regulation S-K, Regulation S-X, and other rules and forms. Although the amendments apply primarily to public reporting companies, certain provisions also impact other entities regulated by the SEC, including Regulation A issuers, investment advisers, investment companies, and broker-dealers.

On June 28, 2018, the SEC adopted amendments that raise the thresholds in the smaller reporting company (SRC) definition, thereby expanding the number of smaller companies eligible for the scaled disclosure requirements under Regulation S-K and Regulation S-X. While in concept the change is simple, compliance requires an understanding of rules regarding when and how the SRC determination is made, and what to do when companies fall in and out of SRC designation.

Rule 701 allows non-reporting companies to issue and sell securities for compensatory purposes without the requirement to register the offer and sale of the shares with the SEC. Under congressional mandate, the SEC recently amended Rule 701(e) to increase the trigger for certain disclosures from $5 to $10 million in aggregate sales of securities sold during a 12-month period. The SEC also issued a concept release soliciting public comment on ways in which the SEC might modernize its rules governing compensatory securities offerings.

Listen as our authoritative panel discusses the ramifications and complexities of each of these regulatory amendments for public and non-reporting companies. The panel will also discuss the JOBS and Investor Confidence Act of 2018, recently passed in the House by a vote of 406 to 4, and how it might effect IPOs and disclosure obligations going forward.



  1. Disclosure simplification—eliminating duplication
    1. Changes under Regulation S-K
    2. Changes under Regulation S-X
    3. Companies affected
  2. Smaller reporting companies
    1. Criteria for meeting new thresholds
    2. Transitioning to the revised definition
  3. Amendment of Rule 701
  4. SEC request for comments to modernize compensatory offering regulations
  5. JOBS and Investor Confidence Act of 2018


The panel will review these and other high priority issues:

  • How the new disclosure simplification amendments will impact Form S-K and S-X disclosures going forward?
  • What financial criteria do companies need to consider before transitioning to scaled disclosures under the new SRC thresholds?
  • What is the significance of Rule 701 as recently amended?
  • How is proposed legislation, such as the JOBS and Investor Confidence Act of 2018, anticipated to impact IPOs and capital formation generally?
  • What other initiatives has the SEC taken and what steps is it expected to take?


Dostal, Derek
Derek Dostal

Davis Polk & Wardwell

Mr. Dostal is a partner in Davis Polk’s Corporate Department, practicing in the Capital Markets Group. He has...  |  Read More

Holmes, Hillary
Hillary H. Holmes

Gibson, Dunn & Crutcher

Ms. Holmes is a partner in the Houston office of Gibson, Dunn & Crutcher, Co-Chair of the firm’s Capital...  |  Read More

Timken, Kevin
Kevin C. Timken

Partner; Co-Leader, Securities & Capital Markets
Michael Best & Friedrich

Mr. Timken has extensive experience in public and private securities offerings, broker-dealer compliance (particularly...  |  Read More

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