Going Public Insights l 2014

There have always been multiple ways that a private company could obtain public company status. In 2013, changes resulting from the JOBS Act, made going public transactions an appealing option for private companies seeking to raise capital. Rule 506(c) allows companies to conduct private placements prior to going public to offset their going public costs. In going public transactions, these privately placed shares are registered on Form S-1 and become the public float.

 

One traditional method of going public remains an Initial Public Offering (“IPO”).  The  IPO is rarely used by small companies as most will not  meet the

The SEC’s Proxy Rules

Most public companies hold a stockholders’ meeting annually and hold special meetings to vote on special corporate actions such as name changes and mergers.  Shareholder voting on takes place either in person or by proxy.

Proxy solicitation is governed by a number of rules and regulations including: (i) state corporate law; (ii) stock exchange listing requirements; (iii) SEC

Form 10 Registration Statements and Alternative Going Public Structures

In going public transactions most issues file Form S-1 registration statements pursuant to the Securities Act of 1933, as amended.  In some circumstances, a Form 10 registration statement may be used. Form 10 is aRegistration Statement used to register a class of securities pursuant to Section 12(g) of the Securities Exchange Act of 1934 (“Exchange Act”).

Section 16 Reporting l Securities Lawyer 101

Shareholders and management of private companies are often unaware of their reporting obligations upon completion of a going public transaction. Section 16(a) of the Exchange Act of 1934 (the “Exchange Act”) requires the reporting of beneficial ownership by the officers, directors and stockholders who hold stock directly or indirectly, beneficially owning more than 10% of the company’s common stock or other class of equity securities registered under Section 12(b) or 12(g) of the Exchange Act.  Section 16 reporting requirements apply to companies that have registered a class of securities under Section 12(b) or Section 12(g) regardless of whether they went public because they filed a registration statement with the SEC or engaged in a reverse merger. Issuers that voluntarily file