While these Proposals may look like “new builds,” the design blueprints are time-tested. These Proposals, if adopted, would impact how public companies register securities and report to investors. I will point to just one example from each proposal to demonstrate how impactful these rules could be.

The Registered Offering Reform Proposal, if adopted, would give smaller public companies access to shelf registration for the first time in decades, increasing the number of eligible companies by more than 60 percent.[5] It would rewire the house to support the higher amperage of capital flows required today. Consider a small, pre-commercial biotech company that successfully completed an IPO within the past year, but that needs to conduct a follow-on offering to raise additional capital to further its clinical trials. The company cannot wait weeks or months for SEC review of its registration statement that repeats much of the same information already provided to investors in its IPO registration statement. But, under the current rules, that’s exactly what companies have to do.

Form S-3, the vehicle for shelf registration, currently requires a $75 million public float and a 12-month reporting history — thresholds set in the 1990s that today shut out companies that have earned their place in the public markets and need to raise capital on their own timelines. The Registered Offering Reform Proposal would replace these obsolete thresholds with two simple questions: (1) Is this company an “ineligible issuer”?[6] and (2) Is this company current and timely in its SEC reporting?[7]

The Filer Status Proposal would take the same approach to disclosure. Right now, SEC rules sort public companies into five different compliance buckets, some overlapping. The proposal, if adopted, would raise the Large Accelerated Filer threshold from $700 million to $2 billion in public float, reserving the most demanding disclosure rules and reporting deadlines for the largest corporations.[8] For everyone else – 81 percent of all public issuers, although only 6.5 percent of total market public float[9] – the amendments would likely result in reduced audit fees and other costs. The current system has a leaky roof and sagging floorboards, and this proposal would alleviate these signs of structural stress.

Some companies become subject to auditor attestation of internal controls[10] before generating a single dollar of revenue, simply because the companies’ market value crosses the accelerated filer threshold at one specific testing date. One biotech company in particular reported spending around $11 million on that compliance obligation alone since it crossed the $700 million public float threshold in 2021, roughly the cost of running a large Phase 2 clinical trial.[11] Under the thresholds in the proposal, many companies would be able to instead deploy that capital to further their business operations.[12]

Jim noted that all of the recent proposals are currently open for comment. Additionally, as Meredith shared a couple weeks ago, SEC Chair Paul Atkins has opened a new comment portal specifically for IPO modernization. Jim’s remarks call out that the SEC is looking for companies as well as investors. Building on another recent blog from Meredith, here are all the upcoming comment deadlines:

– Draft strategic plan – Comments should be received on or before July 2, 2026.

– Semianual Reporting – Comments should be received on or before July 6, 2026.

– Enhancement of EGC Accommodations and Simplification of Filer Status – Comments should be received on or before July 20, 2026.

– Registered Offering Reform – Comments should be received on or before July 27, 2026.

– Modernizing the IPO process and alternative paths to public markets – Comments should be received on or before July 27, 2026.

– Rescinding climate disclosure rules – Comments should be received on or before August 3, 2026.

– Liz Dunshee

– Happy 90th Birthday to Exchange Act (and the SEC)

– The SEC at 90: My Reflections

– What If the Post Office Was the SEC?!?

– Happy (Belated) 90th Birthday to the Securities Act!

Speaking of milestones, Commissioner Peirce also noted in this speech – titled “Peirce Out” – that she’s moving to the beach in the not-too-distant future. I’m not exactly sure when Commissioner Peirce’s last day is at the SEC, but as Meredith shared, she’s starting a new gig at Regent University School of Law this fall. It will be the end of an era!

Looking ahead to what’s on the horizon for the SEC during these exciting times, the agency announced last week that John Moses has been appointed Director of the Office of Investor Education and Assistance, which provides services and resources to help investors build their financial futures and protect against investment fraud. John has been at the SEC since 2016 and has been serving as Acting Director of this Office prior to his permanent appointment. His background before joining the SEC was in real estate, operations, and the US Navy.

– Liz Dunshee

– ‘Form 10-Q for Thee, But Not for Me?’ SEC Proposes Optional Semiannual Reporting

– ‘Everybody into the Pool!’ SEC Proposes to Overhaul Rules for Registered Offerings

– The Great Filer Reset: SEC Proposes to Streamline Filer Status Categories

Email info@ccrcorp.com or call 1.800.737.1271 to subscribe to this essential resource!

– Liz Dunshee

– Valuation.  The IPO’s initial public offering price values SpaceX at $1.77 trillion, which is a mere 100x revenue. NYU’s valuation guru Aswath Damadoran says it’s worth more like $1.25 – $1.35 trillion. Morningstar throws the proverbial turd in the punchbowl and says it’s worth $780 billion, or less than half the IPO valuation – and they’re far from the only valuation skeptic. Who’s right? The answer to that question should play out over the course of the next several months, because to paraphrase Rasheed Wallace, “Aftermarket Don’t Lie.”

– Uh, About the Aftermarket. . .  Buckle your seatbelts.  This deal is expected to have one of the most volatile aftermarkets in history. Even though this will be the largest IPO of all time, it only represents about 5% of SpaceX’s outstanding shares, and that small float is usually a recipe for volatility. Despite the sky-high valuation, it looks like there’s reason to expect a big opening day pop, but how the stock performs over the next several months is anybody’s guess.   

– Outsized Retail Allocation. One of the things you can usually count on with an IPO is that if it reaches down into the lower rungs of retail investors, it’s because there’s not enough smart money demand for the deal. In this case, SpaceX took the unusual step of locking in a price last week, and allocating up to 30% of the deal to retail investors. That put the squeeze on the banks to get investors to sign up for a price that’s locked in at a very high valuation despite, among other things, the past week’s tech rout, and they’re responding with unprecedented outreach to retail. Based on recent reports, it looks like institutional demand may well eat into that allocation, but if retail does end up with 30% of the deal and it tanks, it won’t take long for the politicians to get their knives out for everyone involved.

– Must Love Musk. Anyone who buys SpaceX stock should realize that although the company has a board of directors, its role is purely decorative when it comes to control over the Mercurial Mr. Musk. That’s because, as the prospectus discloses, “removal of Mr. Musk from his board and leadership roles (Chief Executive Officer and Chairman of our board) requires the approval of the holders of at least a majority of the voting power of the outstanding shares of Class B common stock, voting separately as a class.” I’ll give you three guesses as to who owns over 90% of the Class B common stock, and the first two don’t count.

– Prospectus “Sizzle” Aplenty.  Meredith has already weighed in on what a great beach read this 277-page prospectus would make, but what struck me – as it usually does with IPOs – was the mission statement. This is going to sound like an old man yelling “get off my lawn!” but on behalf of those of us whose understanding of the IPO process is based mostly on 20th Century experience, I’ve got to ask – when did it become okay for companies to include overheated mission statements like what’s set forth below in their prospectuses?

Our mission is to build the systems and technologies necessary to make life multiplanetary, to understand the true nature of the universe, and to extend the light of consciousness to the stars. To do this, we have formed the most ambitious, vertically integrated innovation engine on (and off) Earth with unmatched capabilities to rapidly manufacture and launch space-based communications that connect the world, to harness the Sun to power a truth-seeking artificial intelligence that advances scientific discovery, and ultimately to build a base on the Moon and cities on other planets

If you fed this into Elon’s Grok and asked it to summarize it in one sentence, my bet is that it would come up with something very much like “To Infinity – And Beyond!”  Elon’s definitely channeling his inner Buzz Lightyear with this one. And don’t even get me started on the photos – we old folks used to laughingly use rocket ships blasting off as the classic example of prospectus graphics that were certain to be non-starters with the Corp Fin reviewers. This prospectus has 18 pages of them!

As my investment banker friends might say, this deal obviously has “a lot of hair on it,” but you can also understand why it’s gotten so much hype. Take Morgan Stanley’s prediction that this company’s going to do $3.4 trillion in revenue and $2.7 trillion in EBIDTA by 2040, for example. I’ve also got to concede that while I’m not fond of Elon Musk, SpaceX has done things that are so mind-boggling that they’ve literally made my jaw drop.

It’s going to be fascinating to see how all this unfolds – can SpaceX live up to the hype and reach “To Infinity and Beyond!” – or will the aftermarket be a major buzzkill? Stay tuned.

– John Jenkins

Those objections notwithstanding, we’ve also come to expect that most institutional investors will stick to their strategy of “buy now, whine later” when it comes to hot issues.  In the case of SpaceX, the WSJ reported yesterday that BlackRock lobbed in a $5 billion order, and that other big investors were likely to follow suit, so it appears that there aren’t going to be many major institutions growing a spine this time around either.

I’m also eagerly awaiting the inevitable next stage – complaints that regulators or stock exchanges need to ride to the rescue of institutional investors, who despite sitting on the world’s largest pile of money, say they’re incapable of doing anything about offerings whose governance provisions they find objectionable.

I guess I’m somewhat sympathetic to the index funds that will be forced to buy SpaceX shortly after the IPO, although because most buy based on float-adjusted market cap, even this humungous offering isn’t going to result in any index fund holding enormous quantities of SpaceX stock, at least at first.

As for the rest of you guys, if you don’t like Elon or SpaceX’s governance, either don’t buy the stock or buy it and plan on playing the long game. After all, there’s evidence that investors can sometimes wear these dual class founders down.  Don’t think that will work with SpaceX? Then see option 1.

– John Jenkins

It’s apparent that not only did the guys wow the Garden with their halftime performance, but they channeled their inner Knute Rocknes to provide second half inspiration for the Knicks as well. Don’t take my word for it – here’s how yesterday’s New York Times summed up The Wu-Tang Clan’s performance:

Stat of the game: Wu-Tang finished plus-28 on the night.

Some fans are attributing the Knicks’ win to Taylor Swift.  I’ll let our resident Swiftie Dave Lynn make that argument if he wants, but I know what I saw.  Now if I can just figure out a way to get them to show up at a Cleveland Browns game. Have a great weekend, everybody!

– John Jenkins

Historically, insider trading compliance programs were implemented only at publicly traded companies and focused primarily on securities transactions involving publicly traded stock. Because the use of online prediction markets is a relatively new phenomenon, those programs have not explicitly addressed prediction market activity.

In addition, prediction market trading may involve contracts unrelated to publicly traded securities and may implicate confidential information held by private companies, nonprofits, universities, healthcare systems, government contractors, and other organizations that historically may not have maintained formal insider trading policies. As a result, employees and other personnel at public or private companies may incorrectly assume that existing restrictions on the misuse of confidential or proprietary information do not apply to prediction market activity, creating potential ambiguity and increased compliance risk for organizations.

The blog goes on to make specific recommendations for actions that public companies and other organizations should take to appropriately update existing insider trading policies or to include in newly adopted policies to address prediction markets.

– John Jenkins

1. Strategy and Operations. How do data centers tie into the company’s strategy and operations (e.g., do we build, lease, invest, finance, supply), what is the interplay between data centers and our AI strategy, and how do we expect data centers to meet our computing power needs now and in the future? What is the expected obsolescence of the data centers that the company has built, contracted for or otherwise invested in, and are we in a position to retool/retrofit if needed?

2. Monitoring Performance and Oversight. Who on the management team is responsible for data center-related activities and how are those activities factored into their compensation? What financial metrics and other information are they expected to report to the Board and how regularly? Do we have an information reporting system in place to surface issues to the Board as appropriate? Do we have a Board committee tasked with oversight of data center-related matters and do our minutes and materials reflect that?

3. Risk Oversight. Do we understand the risks involved with our data center activity and how the company manages and mitigates those risks? Are those risks built into our enterprise risk management framework, business resiliency plans and policies, and risk oversight processes? (Examples of key risks include power source problems, interconnection delays/latency, community opposition, obsolescence and events that could impact operations such as security or cybersecurity breach, natural disaster, extreme weather, war or terrorist attack.)

4. Delegation of Authority. What data center-related agreements are required to come to the Board for approval? Is this clear under our delegation of authority (e.g., because they involve expenditure over a certain amount or are otherwise material)?

5. Disclosure. What disclosures about data centers have we made in our public filings and other documents, and are the company’s disclosure controls and procedures up to date? What are our peer companies disclosing about data centers?

Other areas of inquiry for the board of directors identified by the memo include sustainability issues, regulation and compliance, governmental relations and shareholder engagement concerning data center-related activities.

– John Jenkins

If you want to hold onto the contents of your wallet a little more tightly than I was able to, be sure to sign up now for our 2026 Proxy Disclosure and Executive Compensation Conferences on October 12th & 13th in Orlando to take advantage of our discounted “early bird” rate. With an agenda featuring two days of fast-paced, topical panels, an all-star speaker lineup, and Dave Lynn’s interview with Corp Fin’s Deputy Director Christina Thomas, attendees will receive critical insights into the latest SEC rulemaking initiatives and developments in governance, disclosure practices, activism & shareholder engagement, and executive compensation.

The folks at the SEC have made it clear that they’re not planning to stand still over the next few months, and we won’t be either. We’ll tweak our agenda as necessary to ensure that ensure that we’re bringing you the most up-to-date information on the SEC initiatives that mean the most to you and your clients.

Register online at our conference page or contact us at info@CCRcorp.com or 1-800-737-1271. Do it today so you don’t miss out on our discounted “early bird” rate!

– John Jenkins

The SEC staff’s comments on management’s discussion and analysis have emphasized the requirements in Item 303 of Regulation S-K and the related disclosure objectives, including a focus on:

– The discussion and analysis of results of operations, including the description and quantification of each material factor, offsetting factors, unusual or infrequent events, and economic developments causing changes in results between periods

– The discussion of known trends or uncertainties that are reasonably expected to impact near- and long-term results (e.g., supply chain disruptions, inflation, increase in interest rates)
Metrics used by management in assessing performance, including how they are calculated and period over period changes

– Critical accounting estimates, including the judgments made in the application of significant accounting policies, sensitivity to change, and the likelihood of materially different reported results if different assumptions were used

– Liquidity and capital resources, including clear discussion of drivers of cash flows and the trends and uncertainties related to meeting known or reasonably likely future cash requirements.

The other topical areas included in PwC’s report are non-GAAP measures, segment reporting, revenue recognition, debt, quasi-debt, warrants and equity, goodwill and other intangibles, business combinations, disclosure controls and ICFR, research and development, and inventory and cost of sales. A separate section of the report also explores industry-specific comment trends.

– John Jenkins