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There are several methods a private company may use in a going public transaction. Filing a registration statement with the Securities and Exchange Commission (“SEC”) subjects the company to the reporting requirements of the Securities Act of 1933, as amended (“Securities Act”), depending on the form chosen. One method of going public is by conducting an Initial Public Offering (“IPO”). The traditional IPO is rarely used by small companies as most will not meet the eligibility requirements to trade on a national securities exchange such as the New York Stock Exchange (“NYSE”) Euronext, NASDAQ, or NYSE MKT (formerly Amex). Moreover, traditional IPO process takes time and money most small companies are unable or unwilling to commit.
Companies seeking capital are frequently approached by finders who offer to locate investors in exchange for a fee. This is particularly true in going public transactions. Most finders are not registered as broker-dealers with the Securities and Exchange Commission (the “SEC”).
The possibility of receiving capital even through the efforts of a finder creates a tempting opportunity for issuers who need capital.
A. Form S-8 (“Form S-8”) is a short-form registration statement under the Securities Act of 1933, as amended (the “Securities Act”).
Q. Can all Companies register a securities offering on Form S-8?
A. Form S-8 can only be used by companies that file reports under Section 13 or Section 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”). In order to register securities on Form S-8, the Company must have filed all reports and other materials required to be filed by Section 13 or Section 15(d) of the Exchange Act during the preceding 12 months or for such shorter period that it was required to file such reports and materials.