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The Securities and Exchange Commission is likely to approve a measure late this month expanding what companies may say to investors during the 30-day “quiet period” before an initial public offering, people close to the agency said. The SEC could vote on the issue as late as June 29, one day before Chairman William Donaldson is to step down. The SEC voted, 5-0, on Oct. 26 to propose new quiet-period rules that allow executives to provide basic information about their businesses and management philosophies in media interviews or on their Web sites. Under current rules, many agree, it’s unclear what issuers may say during this period. The new rules would update 1930s-era regulations. “When you have so much information on the Internet generally available already, it makes sense to allow more communications,” said Ven Palmer, a securities attorney in Bingham McCutchen’s San Francisco office. Regulators have been very careful about allowing companies to say much during the quiet period, fearing that whatever they say might mislead investors in some way. But even with more communications freedom, companies will remain liable for fraudulent quiet-period statements, according to the draft proposed in October. Shareholders or the SEC could sue a company that makes bad-faith claims or provides inaccurate historical data about itself. The agency could also delay an IPO if it feels the issuer is not providing balanced information. “Well-known, seasoned” companies-those that have market capitalization of at least $700 million and have been public for more than a year-would have more latitude than smaller concerns in what they can disclose during the quiet period before secondary or follow-up offerings. Large companies could advertise stock offerings on television, provided that they take legal responsibility for any commercials and file relevant information about the ads with the agency. The rule changes arose after Google Inc.’s highly anticipated $1.7 billion IPO was nearly spoiled last year by confusion stemming from an interview with the company’s founders published in Playboy magazine. SEC spokesman John Heine declined to comment on the proposal or when it might be adopted. “Generally, we announce the meetings for these things one week in advance,” he said.

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