1. The Going-Public Decision 7

Ability to attract and keep key personnel
If a company is publicly owned, employee incentive and benefit plans are usually established in the form of stock ownership arrangements to attract and keep key personnel. Stock option plans, for example, may be more attractive to officers and other key personnel than generous salary arrangements due to the significant upside potential.
Less dilution
Provided your company and the market are ready, you may achieve a better price that results in less dilution compared to other forms of equity financing.
Mergers/acquisitions
These activities may be achieved with stock transactions and thus conserve cash.
All opposed…
Expenses
Many factors play a role in determining the cost of an IPO, but in all cases these costs are significant. Outlined in the table below is the range of IPO costs that should be expected if you decide to go public. Expenses of a completed IPO are reflected as a reduction of additional paid-in-capital and, therefore, are not expensed in the statement of operations. However, if the IPO is not completed, such costs must be expensed.
Cost
Range
Legal
$600,000 – $800,000
Accounting
$400,000 – $600,000
Printing
$150,000 – $200,000
Blue sky
$10,000
Transfer agent/registrar
$5,000
Miscellaneous
$60,000
Underwriters’ discount and
Typically 7% of the aggregate offering proceeds
commission
SEC filing fee
$278 per $1 million of the aggregate offering amount
$500, plus .01% of the aggregate offering amount.
NASD fee
The maximum fee is $30,500.
NASDAQ national market
$5,000 plus a decreasing marginal fee per million shares listed

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