SEC FORM S-3 (Simplified Registration of Shares of certain Well Known U.S. Companies):

Form S-3 is a simplified Securities and Exchange Commission ("SEC") Form that registers securities for companies.

 

In order to use Form S-3, certain criteria must be met. Form S-3 can be used by a company that qualifies, in order to register securities under the Securities Act of 1933, instead of using the original Form S-1.

 

Issuer / Registrant Requirement:

In order to use Form S-3 for securities, your company must meet certain requirements:

  • The company is organized within the United States, a territory of the U.S., or the District of Columbia, and has its main business operations in the U.S. or its territories.

  • The company already has securities registered in accordance with the Securities Exchange Act of 1934.

  • The company needs to have at least $75 million USD in public float. Public float is the portion of shares that are in the hands of public investors. For companies that have less than $75 million, they are limited to one-third of the market value in any trailing 12-month period. This one-third rule is called the "baby shelf rule."

  • The company has traded at least $1 billion USD in non-convertible securities (other than common equity) in primary offerings for cash, not exchange, in the last three years.

  • The company has previously been subject to the requirements of Section 12 or 15(d) of the Exchange Act and has filed all the information that is required to be in accordance with Sections 13, 14 or 15(d) for at least twelve calendar months immediately before filing Form S-3.

  • The company and its subsidiaries have not failed to pay any dividend or sinking fund installments on preferred stock, or defaulted on any installments of borrowed money or on any long-term leases, since the close of the last fiscal year.

  • The company has filed all previous paperwork in a timely fashion and they trade regularly on the national exchange.

Transaction Requirements:

Not all securities can be filed using Form S-3. In order to use Form S-3, the transaction needs to be one of the following types of transactions.

  • Primary and secondary offerings that are offered for cash by a company that has met the registrant's requirements.

  • Primary offerings of non-convertible equity other than common stock.

  • Securities that are secondary, meaning they are offered to someone other than the issuer of the security. 

  • Rights offerings, dividend or interest reinvestment plans, conversions, warrants, and stock options that are being sold for cash.

 

Negotiations of Form S-3

While many investors want companies to use the S-3 forms for the ease and quickness, there are some things that should be negotiated between companies and investors beforehand.

  • The number of S-3 registrations: Companies will want this number to be low. As few as two or three a year are best. Investors want unlimited amounts. There are legal and accounting expenses associated with all S-3 registrations, which is why a company will want to keep them to a minimum.

  • The minimum size of an S-3 registration: To make this worthwhile for a company, S-3 registrations should have a minimum amount required before they are to be registered (something like $1 Million USD). This will avoid any frivolous registration requests.

Form 8-K

Form 8-K is a SEC document that needs to be filled out by a company when a major event occurs. Possible events can be the termination of a business agreement, the completion of an acquisition, or the addition or removal of a director or certain officers. The form is important because it gives current and future investors real-time disclosure of important corporate events. It must be filed within FOUR DAYS of the event taking place. 

Not filing your 8-K on time under these specified items will affect your eligibility to use Form S-3: 

  • Item 1.03 – Bankruptcy or Receivership

  • Item 2.01 – Completion of Acquisition or Disposition of Assets 

  • Item 3.01 – Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing

  • Item 3.02 – Unregistered Sales of Equity Securities 

  • Item 3.03 – Material Modification to Rights of Security Holders 

  • Item 4.01 – Changes in Registrant's Certifying Accountant Item 

  • Item 4.02(b)-(c) – Non-Reliance on Audit Report or Completed Interim Review 

  • Item 5.01 – Changes in Control of Registrant 

  • Item 5.02(a)-(d), (f) – Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers 

  • Item 5.03 – Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year 

  • Item 5.04 – Temporary Suspension of Trading Under Registrant's Employee Benefit Plans 

  • Item 5.05 – Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics 

  • Item 5.06 – Change in Shell Company Status 

  • Item 5.07 – Submission of Matters to a Vote of Security Holders 

  • Item 5.08 – Shareholder Director Nominations 

  • Item 6.01 – ABS Informational and Computational Material 

  • Item 6.02 – Change of Servicer or Trustee 

  • Item 6.03 – Change in Credit Enhancement or Other External Support 

  • Item 6.04 – Failure to Make a Required Distribution 

  • Item 6.05 – Securities Act Updating Disclosure 

  • Item 6.06 – Static Pool 

 

If you fail to file Form 8-K in time under any other item, it will not affect your company's eligibility to use Form S-3.

Form S-3 is filed on the SEC EDGAR system in HTML format. The SEC only accepts a simplified version of HTML, requiring the source documents to be converted using specialized SEC EDGAR software (as opposed to simply using the "Save as HTML" option in a word processor). Form S-3 also requires the filing entity to be registered with the SEC EDGAR system and have valid EDGAR filing codes, and pay a fee based on the number and offering price of the shares being registered.

To Retain and Engage Private Placement Markets for a S-3 Registration Statement Filing:

Private Placement Markets regularly works with companies and their legal counsel with respect to the creating and filing of SEC Form S-3; we consider it one of our specialties. 

 

After the complete SEC Form S-3 is drafted and approved by your company, Private Placement Markets will convert the approved and finalized S-3 Registration Statement to SEC EDGAR HTML format, and provide you and your team with an online proof. After obtaining your final approval, we file the Form S-3 with the SEC EDGAR system.

The process of filing and having an S-3 approved by the SEC can take anywhere from just a couple of weeks to a few months, depending on amount of material and complexity of the Filing. The entire Private Placement Markets team is available throughout this entire process to prepare and submit subsequent amendments, redlines, and correspondence letters.

 

Service(s) to be Provided:

  • Drafting & Preparation of a Federal Securities Laws Compliant S-3 Registration Statement.

    • Our Custom S-3 Registration Statement includes (but is not limited to):

      • Structuring and Development of a Presentation Grade S-3 Registration Statement,

      • all SEC Filing(s) as required via the EDGAR,

      • all ISIN Filings as required

      • Capital Markets filing support (NYSE, NASDAQ, OTC),

      • Federal Securities Laws Compliance Review, and

      • Access to our Broker-Dealer Network & International Institutional Investment Banking Network (See www.PPMEquity.com & www.PPMDebt.com)

      • Does Not include any expenses associated with any required Financial Audits, Legal Opinion Letters, Stock Transfer Agents, DTC Registration, Broker Dealer / Market Maker Fees, Shares Registration Fees payable to the SEC, and/or any Listing Fees associated with a Capital Markets Listing. 

To engage us for a Custom S-3 Registration Statement Preparation:

  1. Private Placement Markets is very selective about the S-3 Clients it engages with. Please call our Capital Markets Team or email us as the contact listed to the left, and we will schedule a time to speak regarding your S-3 needs.

  2. If there is a mutual interest to engage for the Drafting and Filing of your S-3, we will forward you an engagement letter to be signed, at which time you will be required to submit a retainer equal to 50% of our service charge for the drafting of the Custom S-3 Registration Statement. Our total estimated cost for a Custom S-3 Registration Statement is a Flat $20,000 USD (50% = $10,000 USD). NOTE: The balance of $10,000 will be due and payable 30 days net from retaining services or upon delivery of a final S-3 Registration Statement whichever comes first.

  3. Once complete, we will send you an email with information detailing the necessary information we need to get started working on the custom S-3 Registration Statement.

  4. General Time from Start-to-Finish, given the vast number of Registration Statemetns we have done over the past five plus years, approximately two to four weeks (could be shorter, could be longer, much depends on complexity and amount of information). 

Mr. Steve Muehler

Founder & Managing Member

Private Placement Markets

101 California Street

San Francisco, CA 94111

Email: Steve@PPMSecurities.com

Phone: (877) 259-8066

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Private Placement Markets, LLC (a Delaware Limited Liability Company) provides no depository services and is not insured by the FDIC. Private Placement Markets is an Investment Banking Industry Document Preparation Company and Capital Markets Advisor. Private Placement Markets does not offer, and does not offer to provide any broker dealer or market maker services. Private Placement Markets operates this website (referred to as the “Website”). By accessing this Website and any pages thereof, you agree to be bound by its Terms of Use and Privacy Policy. Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. Private Placement Markets does not provide financial planning services. Private Placement Markets does not provide tax advice and does not represent in any manner that the outcomes described herein will result in any particular tax consequence.

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