As we previously blogged, in June 2012 the SEC adopted final rules directing national securities exchanges to establish listing standards relating to compensation committees. The NYSE and Nasdaq have now done so.
Our colleagues Christopher C. Paci, Jason C. Harmon, Joe C. Sorenson, and Christopher B. Edwards have prepared the following summary of these new listing rules.
CONTRIBUTED BY
Andrew Ledbetter
andrew.ledbetter@dlapiper.com
Last week the SEC adopted final rules directing national securities exchanges to establish listing standards relating to Compensation Committees. (You may recall that Section 952 of Dodd-Frank Wall Street Reform and Consumer Protection Act required the SEC to adopt such rules by July 1, 2011, which slipped a bit.)
Below is a short summary of what these new rules require:
CONTRIBUTED BY
Andrew Ledbetter
andrew.ledbetter@dlapiper.com
As a quick follow up on this topic from a few months ago (prior post can be read here), the SEC has approved alternatives to Nasdaq's historical $4 minimum bid price listing standard. Under the new alternative listing standards, a security may qualify for listing on the Nasdaq Capital Market if:
$3/share price -- for at least five consecutive business days prior to approval, the security has a minimum closing price of at least $3 per share and the issuer has either:
$2/share price -- for at least five consecutive business days prior to approval, the security has a minimum closing price of at least $2 per share and the issuer has (A) market value of listed securities of at least $50M; (B) stockholders’ equity of at least $4M; and (C) market value of publicly held shares of at least $15M.
In addition, the issuer must also demonstrate that it has:
CONTRIBUTED BY
Trent Dykes
trent.dykes@dlapiper.com
John Melloy’s article entitled “The Dictators of Silicon Valley: Facebook, Google Stripping Shareholder of Power” highlights an interesting trend among tech companies that have gone public in the past several years – implementing dual-class voting structures. The general idea behind these dual-class voting structures is to keep control in the hands of the individuals (usually the founders) who supposedly know what is best for the company and to shield a company from potential public company shareholder activism and hostile takeovers. Control is maintained by either giving the founder shares more votes per share than the shares issued to the public (or issuing non-voting shares to the public) – for example, founders would hold Class B common stock entitled to 10 votes per share, while the general public would hold Class A common stock entitled to one vote per share.
CONTRIBUTED BY
Megan Muir
megan.muir@dlapiper.com
Join us for a complimentary webinar regarding the Jumpstart Our Business Startups Act (the "JOBS Act"). This one-hour webinar for venture capital investors, private equity firms, startup entrepreneurs, late stage companies and management of portfolio companies will cover the following provisions of the Act:
The IPO “on-ramp”
Private offerings
New small offerings regime (up to $50 million)
Which changes take effect immediately
Presenters
Register for the webinar here.
On March 27th, the US House of Representatives overwhelmingly passed the Jumpstart Our Business Startups Act (JOBS Act) with the Senate's recent amendments. Next stop is the President's desk for what is anticipated to be speedy signature. The legislation is intended to improve the ability of emerging growth companies to access capital by relaxing certain rules in private offerings as well as in the period following a company's initial public offering. Read the details in this summary by our colleagues Christopher C. Paci, Edward Batts, Ann Lawrence, Jason C. Harmon, Christopher B. Edwards, and Andrew D. Ledbetter.
CONTRIBUTED BY
Andrew Ledbetter
andrew.ledbetter@dlapiper.com
The Facebook IPO is a pretty big deal generally. Whether Facebook would go public stirred media frenzy and Congressional testimony in the past year. Facebook’s initial registration statement indicated it would be the largest tech company IPO ever (the fee table on the original filing showed a $5 billion offering – the filing fee alone was $573k). And the company’s social importance is undeniable.
But what will the SEC staff think about Facebook’s disclosures? Will the path to going public hit some speed bumps? We got our first big clue on Wednesday, when after the markets closed Facebook filed its first substantive amendment to the Form S-1 for its IPO. (It filed Amendment No. 1 shortly after its original filing, solely to add exhibits.)
On interesting deals, I sometimes compare an amended S-1 to the prior filing to see what changed. Seeing what disclosures a company has changed lets me surmise whether SEC comments may have driven the change and piece together the issues the SEC staff has raised with the filing. In a deal like Facebook’s, you can assume the staff heavily, carefully reviewed the filing, so the comments the staff elected to give may reveal points of general SEC emphasis, with potential application to other companies. A deal like this also tends to become a frequently used source for future disclosures by other companies looking for precedents, which makes monitoring Facebook’s disclosures particularly interesting.
Or perhaps that’s just my rationalization – I just couldn’t help but spend a few hours looking at this…
In any event, for kindred spirits, my guess is that Facebook probably received SEC comments clustered around the themes discussed below. For those who do not routinely review registration statements, this post will be fairly technical and you may want to stop reading now.
CONTRIBUTED BY
Andrew Ledbetter
andrew.ledbetter@dlapiper.com
This week Nasdaq filed a proposed rule change with the SEC to adopt an alternative to the $4 initial listing bid price requirement. As proposed, a company would be able to list with a:
CONTRIBUTED BY
Megan Muir
megan.muir@dlapiper.com
Thomson Reuters and the National Venture Capital Association issued their “Exit Poll” report for Q3 2011 today, showing a marked slowdown in venture-backed IPOs compared to Q2 2011. According to the report, only 5 venture-backed companies went public in the third quarter (compared to 22 in Q2 2011), while M&A activity among companies with VC investors was down slightly in volume (33 in Q3 versus 35 in Q2) but up 8% in aggregate deal value ($6.3B) relative to Q2 2011 ($5.8B). John Cook of Geekwire has a post up today about it as well. The full report is available here or from Mark Heesen's overview.
The Venture Alley is a blog about business and legal issues important to entrepreneurs, startups, venture capitalists and angel investors. The Venture Alley is edited by Asher Bearman, Trent Dykes and Megan Muir, corporate and securities lawyers at DLA Piper. Contributing authors to The Venture Alley...
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