Professional Documents
Culture Documents
More
and
more
issuersgoing publicopt
for
a
direct public offering.
In
adirect public offering
management sells shares of the companys stock
directly to investors, rather than through the efforts of
an underwriter.Going publicwith adirect public offering
eliminates costs and risks associated with a reverse
merger transaction.Private companies conducting a
direct public offeringshould consider the pointers below
to ensure a successful and cost-effectivegoing public
transaction.
Thedirect public offeringprocess provides options for
multiple structures, each with its own unique benefits
and requirements. The decision about the appropriate
going publicstructure often involves complex legal
issues that vary depending upon the needs of the
particular company involved.
Financial Statements
AForm S-1registration statement requires that the
issuer provide audited financial statements for its most
recent two fiscal years or shorter period that it has been
in existence. The company must have an accountant
who is capable of preparing GAAP-compliant financial
statements and the necessary footnotes.
A companygoing publicmust hire an independent
registered public accounting firm to audit the financial
statements prepared by its accountant. The auditor
must also provide an independent opinion addressing
whether or not those financial statements are relevant,
accurate, complete, and fairly presented.
Disclosures In The
Going PublicProcess
TheSECandFINRAmay examine the companys website,
press releases and other publicly available information
looking for potentially misleading statements. If either
finds improper statements, they will issue comments asking
the company to offer explanations.
If theSECbecomes concerned about misleading disclosures
it will not approve the companys registration statement.
Similarly, ifFINRAbelieves an issuer is using untrue or
misleading disclosures to condition the market for a
companys securities, it will not approve the Form 211
application to initiate quotations in the OTC Markets.
Addressing areas of concern regarding disclosure early with
your attorney is often much easier than waiting for the
comment to arise.
Once all of the above has been accomplished, the new public
companys stock will be eligible to trade electronically. While
the process may seem daunting, especially given that
management of small startups rarely has a good understanding
of regulatory requirements, with the help of an experienced
securities attorney it can be made relatively painless.
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A+ Offerings
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About Brenda Hamilton
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Direct Public Offering
Direct Public Offering Attorneys
Draft Registration Statements
DTC Chills
DTC Eligibility
DTC Global Locks
Due Diligence
EB-5 Program & Going Public
Eligibility & Regulation A+
Form S-3 Registration Statement
Form S-8 Registration Statement
Funding Portals
Global Locks
Go Public 101
Going Public Attorney
Going Public Bootcamp
Going Public for Foreign Issuers
Going Public Law
Regulation A+ Disclosures
Regulation A+ Q&A
Regulation A+ SEC Reporting
Reverse Mergers 101Schedule 14A
Schedule 14C
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