What Do Selling Shareholders Disclose In Form S-1? Going Public Lawyers

Selling Shareholder Disclosure

Securities Lawyer 101 Blog

Companies going public have a variety of structures for their transactions. Companies can sell shares in reliance upon Rule 506 of Regulation D and file a selling shareholder registration statement with the Securities and Exchange Commission (“SEC”) to register the resale of those shares on Form S-1.  A selling shareholder registration statement can be combined with a capital raising transaction to provide capital to offset going public costs.

Item 507 of Regulation S-K of the Securities Act of 1933, as amended sets forth the requirements for selling shareholder disclosures.

Item 507 of Regulation S-K requires the following disclosures:

• Name of each selling security holder and if a corporate entity its control person
• Relationship between each selling shareholder and the company
• Relationship between each selling shareholder and one another
• Number of shares being registered?

• Number of outstanding shares held before and after the offering
• Percentage of shares owned before and after the offering assuming all shares are sold

Officers and directors and other affiliates can register a limited number of shares, in most cases less than 1%, of total holdings owned by all stockholders.

For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit  www.securitieslawyer101.com.  This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship.  Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates Going Public Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855
www.SecuritiesLawyer101.com