“Proposed Amendment to SEC Rule 163(c) Would Help ‘Well-Known Seasoned Issuers’ Test the Waters Before Proceeding with a Public Offering”

On December 18, 2009, the Securities and Exchange Commission issued for comment a proposed amendment to SEC Rule 163(c) that is intended to allow underwriters and dealers to act as agents or representatives for the category of large publicly traded companies called "well-known seasoned issuers" (WKSIs) in communicating with potential investors about possible public offerings prior to the filing of a registration statement with the SEC.  

This change, if adopted, would allow WKSIs to more easily "test the waters" before making a public offering, thereby avoiding the expense and public disclosure requirements associated with filing a registration statement should the issuer decide not to proceed with the offering.  The proposed rule change will not affect public companies that are not WKSIs.