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Always Evolving and Adapting

Legal Advisors on Initial Public Offerings (IPOs)

Regardless of market conditions, companies always expand their business scale through access to capital markets and consider going public in the United States. Regardless of which method of going public, the process is strictly regulated and can be challenging, costly, and time-consuming without experienced advisors.

During the IPO process, companies must be familiar with the following regulations:

  • Securities and Exchange Commission (SEC) and Federal Securities Law
  • Rules of the selected domestic stock exchange (usually NASDAQ or NYSE)
  • Rules of the Underwriting Securities Company (FINRA)

These rules are constantly evolving, and their interpretations change both through formal written guidance and informal practices based on practice. Proper legal representation in an IPO requires advanced expertise and skills.

The attorneys at ANTHONY, LINDER & CACOMANOLIS, PLLC possess the expertise necessary to support corporate IPOs and act with integrity on behalf of their clients.

Understanding the IPO Process

An IPO requires submission of a registration statement to the SEC, but it is only part of the overall process. Broadly speaking, the IPO involves the following steps:

1. Team Composition

In addition to legal counsel, companies should organize the following teams:

  • Underwriting Firms / Investment Bankers
  • Certified Public Accountant (in-house or external)
  • Independent auditor
  • Title Transfer Agent
  • EDGAR Agent
  • A dedicated internal team working with external teams

2. Organizational Development

Corporate cleanup is required before an IPO. The content includes the following:

  • Establishment of a holding company
  • Change of state or country where the corporation is located
  • Amendments to incorporation documents such as articles of incorporation and supplementary articles of incorporation
  • Establishment of a stock option plan for employees
  • Conclusion of employment contracts and contracts between affiliated companies
  • Establishment of the Board of Directors

3. Starting Practice

From an early stage, we implement the following:

  • Obtaining audited financial statements
  • Drafting the registration notification form

We work closely with your accounting and internal teams to support you in submitting registration statements immediately after the audit is completed. Additionally, the registration form must accurately reflect the company’s story.

4. Choosing and Applying for an Exchange

If you wish to list on NASDAQ or NYSE/NYSE American, we will prepare and submit the application on your behalf. We also support exchange selection.

5. SEC Process

When the initial registration statement is submitted to the SEC, a period for submitting comments and reviewing is provided. We support this process on a daily basis.

6. Collaboration with Underwriting Companies

Throughout the entire IPO process, the underwriter conducts thorough due diligence. We handle inquiries and support with procedural procedures.

We also support FINRA approval (5150 process) and underwriting contract negotiations.

7. Roadshow

All IPOs include a marketing period (roadshow). We support compliance with marketing materials and processes.

8. IPO Closing

Coordinate with exchanges, reassignment agents, DTCs, and underwriting securities companies to ensure fund distribution and the initiation of securities trading.

Advantages and Disadvantages of Going Public

Advantages

  • Raising funds for a diverse investor base
  • Lower capital costs than private companies
  • Securing an exit strategy
  • Enhancing corporate image and reputation
  • Securing and retaining talented personnel

Disadvantages

  • Cost Burden
  • Restrictions on Business Information Disclosure
  • Activist Investor Risk
  • Responsibilities of Officers and Directors
  • Acquisition Risk

Advice for Going Public

Going public requires a significant amount of time, effort, and cost. Because the process is complex, it is necessary to consult a lawyer who is well-versed in securities law and understands its impact on decision-making.

Contact Us

For consultations, please feel free to contact us by phone 877-541-3263 or email.