SEC Reporting

Chapter 11Emerging Growth Companies

Learning objectives

• Recognize the eligibility requirements for emerging growth companies.
• Identify the scaled filing provisions.
• Recall the qualifications under the Fixing America’s Surface Transportation (FAST) Act of 2015.

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Eligibility requirements

The Jumpstart Our Business Startups (JOBS) Act was signed into law on April 5, 2012. A primary goal of the JOBS Act is to improve small companies’ access to capital, because job growth is coming from smaller companies. The act amended the securities laws to ease the process and costs associated with raising capital and therefore provide liquidity for growth.

To facilitate initial public offerings of equity securities, Title I of the JOBS Act created a new category of filers called emerging growth companies (EGCs), which are entitled to certain reporting reliefs. EGCs are defined as companies that meet the following criteria:

• Less than $1.07 billion of total annual gross revenue in the most recently completed fiscal year and as of December 8, 2011, had not sold common equity securities under a registration statement

Filers will maintain EGC status for five years following their initial public offering (IPO) unless any of the following disqualifying ...