Post-Filing—Written Offering-Related Communications
Prior to the Securities Offering Reform, a company had three ways to communicate matters relating to the IPO after filing the registration statement and before the SEC de- clared it effective (the so-called “waiting period”): (1) the “red-herring” preliminary pro- spectus (so-named for the red legend printed on the cover of the prospectus stating that offers cannot be accepted until the registration statement is effective), (2) a press release or tombstone advertisement that provided very limited information identifying the offer- ing pursuant to Rule 134 of the Securities Act, and (3) road show meetings with potential investors. Recent reforms relaxed the restrictions on written offering-related communica- tions that can be made after the registration statement is filed in two ways. The first is incremental—expansion of the types of information permitted to be included in a press release or similar publications under Rule 134. The second is moreradical—the permitted use of “free-writing prospectuses.”
Press Releases and Other Offering Notices
A press release has typically been used by companies to publicly announce the IPO after the registration statement is filed, and to tell potential investors from whom a pro- spectus can be obtained. Rule 134 substantially limits the information a company may in- clude in the release. As a result of the reforms, however, the release may now include more information about the company and its business, the mechanics and anticipated schedule of the IPO, procedures for account opening and for submitting indications of interest and conditional offers to buy the offered securities, and procedures for directed share plans and other participation in the IPO by officers, directors and employees. This notice may be in the form of a press release, an email or a website posting.