The Isolated Offering, Vol 10, Issue 1
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The Isolated Offering
A Newsletter of The Lebrecht Group, APLC
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| January 12, 2010 |
Volume 10, Number 1
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| In This Issue
Smaller Reporting Company Alliance Created to Service Needs of Smaller Reporting Companies Equity Lines Emerge as Attractive Financing Alternative for Public Companies
Rule 3(a)(10) Fairness Hearings: An Overview What if One of my Service Providers is Under SEC Investigation? Planning on Going Public in Less Than Ideal Economic Times? – Consider an IFIPO Preparing Your Company for the Audit Rule 144 Resales – A Practical Outline
View LinkedIn Profile for Craig V. Butler, Esq. Contact Us http://www.thelebrechtgroup.com 9900 Research Drive 406 W. South Jordan Parkway
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Smaller Reporting Company Alliance Created to Service Needs of Smaller Reporting CompaniesOrganization formed to meet the unique needs of smaller reporting companies, which are not currently being serviced by existing media and other sources Directors and executive officers of smaller reporting public companies receive all the same various publications and e-mails related to new rules and regulations promulgated by the Securities and Exchange Commission that larger public reporting companies receive, and most have the same question: How does this affect my company? It is no secret that most organizations, including large law firms and trade organizations, that publish announcements related to new rules or regulations promulgated by the SEC do so to attract the attention of larger public companies (accelerated filers) and, therefore, the content does not address how the new rules and regulations affect smaller reporting companies. It is also no secret that many larger law firms, accounting firms, consulting firms and investor relations firms do not represent smaller reporting companies, or if they do, they do not meet their informational needs since they have larger clients on which to focus their attention. With this premise in mind, The Lebrecht Group, APLC created the Smaller Reporting Company Alliance (SCRA). SCRA has multiple objectives, with the primary one to be a one-stop shop for officers and directors of smaller reporting companies. A place where they can come to the website and stay informed of new rules and regulations and the impact they will have on their companies. Additionally, the directors and officers will have the ability to ask service providers that service smaller reporting companies questions related to things that impact their companies; as well as find a variety of service providers if they are looking for a particular provider for their company, such as an attorney, auditor, CFO consultant, investor relations firm, and many others. [more] Equity Lines Emerge as Attractive Financing Alternative for Public Companies?by Brad Wilhite, Ascendiant Capital Group, LLC Beginning with the collapse of the financial markets in the latter part of 2008 and continuing through 2009, investment capital has been scarce for public companies and, in particular, smaller micro-cap issuers. During this time, while public companies have found it extremely challenging to raise investment capital, a financing instrument that has been in the market and available to issuers for over a decade – the Equity Line – has emerged as an attractive alternative for public companies as well as institutional investors. Collapse of the Capital Markets and Emergence of the Equity Line Leading up to the financial markets collapse, there were several years during which capital was flowing at an increasing rate into hedge funds and institutional investment funds, giving micro-cap public companies the ability to raise capital from a variety of sources while selecting terms and structures that best fit their needs. Hundreds of hedge funds were formed during that time, and capital was deployed aggressively. PIPE (private investment in public equity) became the term commonly used to describe the market that developed around investment transactions involving private investors and public companies. As the PIPE market flourished, public companies had many options for raising equity capital from institutional investors. Issuers could sell common stock and warrants, known as unit offerings, and they could issue convertible preferred stock and convertible debt. Some companies also utilized Equity Lines, but the availability of large sums of capital in single transactions without the need for a Registration Statement to be deemed effective in advance of receiving funds – as required by Equity Lines, made other forms of PIPE transactions more attractive to issuers. [more] |
