An at-the-market (ATM) offering is a type of secondary offering whereby a public company sells its existing shares directly to the market at prevailing market prices through a broker-dealer. The company can sell shares through an ATM offering at any time, and the amount of shares sold can vary depending on the company’s needs.

ATM offerings are a common way for companies to raise capital, and they can be a good option for companies that want to avoid the costs and scrutiny associated with a traditional secondary offering. ATM offerings can also be a good way for companies to raise capital quickly, as they can be done without having to file a prospectus or obtain shareholder approval.

However, there are also some risks associated with ATM offerings. For example, if the market price of the company’s shares falls below the offering price, the company could lose money. Additionally, ATM offerings can dilute the value of existing shares.

Overall, ATM offerings can be a good way for companies to raise capital, but it is important to weigh the risks and benefits before deciding whether to do an ATM offering.

What is the purpose of an ATM offering?

The purpose of an ATM offering is to raise capital for the company. The company can use the proceeds from the offering for any purpose, such as to repay debt, fund an acquisition, or invest in research and development.

How does an ATM offering work?

An ATM offering works by allowing the company to sell its shares directly to the market at prevailing market prices. The company can sell shares through an ATM offering at any time, and the amount of shares sold can vary depending on the company’s needs.

When a company conducts an ATM offering, it will typically hire a broker-dealer to help it sell the shares. The broker-dealer will then sell the shares to investors at the prevailing market price. The company will receive the proceeds from the sale of the shares, which it can then use for whatever purpose it deems necessary.

What are the benefits of an ATM offering?

There are a number of benefits to conducting an ATM offering. For example, ATM offerings can help companies to raise capital quickly and easily. Additionally, ATM offerings can help companies to avoid the costs and scrutiny associated with a traditional secondary offering.

ATM offerings can also be a good way for companies to raise capital from a wider range of investors. This is because ATM offerings can be done without having to file a prospectus or obtain shareholder approval. This means that ATM offerings can be open to a wider range of investors, including retail investors and institutional investors.

What are the risks of an ATM offering?

There are also some risks associated with ATM offerings. For example, if the market price of the company’s shares falls below the offering price, the company could lose money. Additionally, ATM offerings can dilute the value of existing shares.

Overall, ATM offerings can be a good way for companies to raise capital, but it is important to weigh the risks and benefits before deciding whether to do an ATM offering.

How does an ATM offering affect the company’s stock price?

The impact of an ATM offering on the company’s stock price can vary depending on a number of factors, such as the size of the offering, the company’s financial condition, and the market conditions. However, generally speaking, ATM offerings can cause the company’s stock price to decline. This is because the sale of new shares increases the supply of shares available to the market, which can drive down the price of the stock.

What are some of the alternatives to ATM offerings?

There are a number of alternatives to ATM offerings, such as traditional secondary offerings, private placements, and debt financing. The best option for a company will depend on a number of factors, such as the amount of capital needed, the company’s financial condition, and the market conditions.

Here are some of the key documents and timing involved in an ATM offering:

• Equity Distribution Agreement: This is an agreement between the company and the broker-dealer that will be selling the shares. The agreement will outline the terms of the offering, such as the price of the shares and the commission to be paid to the broker-dealer.
• Prospectus: This is a document that must be filed with the Securities and Exchange Commission (SEC) before the offering can commence. The prospectus will provide information about the company and the offering, such as the company’s financial condition and the use of the proceeds from the offering.
• Form 8-K: This is a report that must be filed with the SEC within 15 days of the completion of the offering. The Form 8-K will provide information about the results of the offering, such as the amount of shares sold and the proceeds received by the company.

The timing of an ATM offering can vary depending on the company and the market conditions. However, typically, the company will file the prospectus with the SEC and begin the offering process several weeks before it actually needs the proceeds from the offering. This allows the company to gauge investor interest and adjust the terms of the offering as needed.

The company will typically continue to sell shares through the ATM offering until it has raised the desired amount of capital. Once the company has raised the desired amount of capital, it will terminate the ATM offering and cease selling shares.

A private placement is when a public company sells securities (shares, bonds, etc.) to a small group of investors, rather than selling them to the general public through an initial public offering (IPO). This type of financing can be a good option for public companies that need to raise capital quickly or that want to avoid the costs and scrutiny associated with an IPO.

There are a few different ways that a public company can conduct a private placement. One way is to sell securities directly to a group of investors, such as institutional investors or wealthy individuals. Another way is to sell securities to a broker-dealer, who will then sell them to investors.

What are the advantages of private placements?

There are a few advantages to conducting a private placement. First, it can be a faster and more efficient way to raise capital than an IPO. Second, it can help to avoid the costs and scrutiny associated with an IPO. Third, it can help to build relationships with investors who may be interested in investing in the company in the future.

What are the disadvantages of private placements?

However, there are also a few disadvantages to conducting a private placement. First, it can be more expensive than an IPO. Second, it can be more difficult to find investors who are willing to invest in a private placement. Third, it can be more difficult to get the same level of disclosure and transparency as an IPO.

When should a public company conduct a private placement?

Overall, a private placement can be a good option for public companies that need to raise capital quickly or that want to avoid the costs and scrutiny associated with an IPO. However, it is important to be aware of the risks and disadvantages before conducting a private placement.

Here are some of the factors that public companies should consider when deciding whether to conduct a private placement:

• The amount of capital the company needs to raise
• The timeline for raising the capital
• The company’s financial condition
• The company’s business plan
• The company’s investor relations strategy

If you are a public company that is considering conducting a private placement, it is important to consult with an experienced securities attorney to discuss the specific risks and benefits of private placements.

Nasdaq is one of the largest stock exchanges in the world, and it is home to some of the most well-known companies in the world. However, even companies that are listed on Nasdaq can be delisted if they fail to meet the exchange’s listing standards.

There are a number of reasons why a company might be delisted from Nasdaq. Some of the most common reasons include:

• Failure to meet minimum bid price: The company’s stock must trade at a minimum bid price of $1.00 per share.
• Failure to meet minimum market capitalization: The company’s market capitalization must be at least $2 million.
• Failure to meet minimum number of shares outstanding: The company must have at least 300,000 shares outstanding.
• Failure to meet minimum revenue: The company must have at least $1 million in revenue for the most recent fiscal year.
• Failure to maintain an independent audit committee: The company must have an independent audit committee.
• Failure to file regular reports with the SEC: The company must file regular reports with the SEC.
• Failure to meet corporate governance requirements: The company must meet certain corporate governance requirements.

If a company is delisted from Nasdaq, it can still trade on other exchanges, but it will likely have a much lower market capitalization and be less visible to investors.

There are a few things that companies can do to avoid being delisted from Nasdaq:

• Make sure that they meet the exchange’s listing standards
• If they do not meet the standards, take steps to correct the problem
• Communicate with Nasdaq if they are having problems meeting the standards
• If they are delisted, try to get listed on another exchange
• Contact Carmel, Milazzo & Feil to guide you through the process

If you are an investor in a company that is listed on Nasdaq, it is important to be aware of the risks of delisting. If a company is delisted, it could have a significant impact on the value of your investment.

A 10-K is an annual report filed with the Securities and Exchange Commission (SEC) by a publicly traded company. It provides a comprehensive overview of the company’s business and financial condition, including audited financial statements.

If you’re an investor, you should care about 10-Ks because they provide you with important information about the companies you’re investing in. By reading a 10-K, you can learn about a company’s business model, its financial health, and its risks. This information can help you make informed investment decisions.

Here are some of the key things you can learn from a 10-K:

• The company’s business description: This section of the 10-K describes the company’s products or services, its customers, and its competition.
• The company’s financial statements: The 10-K includes the company’s balance sheet, income statement, and cash flow statement. These statements provide a snapshot of the company’s financial condition at a specific point in time.
• Executive compensation: The 10-K includes information about the company’s executive compensation, including salaries, bonuses, and stock options.
• Risk factors: The 10-K includes a section on risk factors that could affect the company’s business. This section is important to read, as it can help you identify any potential risks that could impact your investment.
• Management’s discussion and analysis of financial condition and results of operations: This section of the 10-K provides management’s perspective on the company’s financial performance. It discusses the company’s strengths, weaknesses, opportunities, and threats.

Reading a 10-K can be a daunting task, but it’s an important one if you’re an investor. By taking the time to read a 10-K, you can learn more about the companies you’re investing in and make more informed investment decisions.

Here are some tips for reading a 10-K:

• Start with the executive summary: The executive summary provides a high-level overview of the company and its business. It’s a good place to start if you’re not familiar with the company.
• Read the risk factors: The risk factors section is important to read, as it can help you identify any potential risks that could impact your investment.
• Pay attention to the financial statements: The financial statements provide a snapshot of the company’s financial condition at a specific point in time. They’re important to read if you’re trying to assess the company’s financial health.
• Don’t be afraid to ask questions: If you have any questions about the 10-K, don’t be afraid to ask a financial advisor or an investment professional. They can help you understand the information in the 10-K and make informed investment decisions.

Nasdaq is one of the largest stock exchanges in the world, and it offers three tiers of listing for companies: Global Select Market, Global Market, and Capital Market. Each tier has its own requirements, and companies must meet certain standards to list on a particular tier.

The Capital Market is the lowest tier, and it is reserved for companies with the fewest financial requirements. To list on the Capital Market, a company must have a market value of listed securities of at least $15 million, and at least 300 round lot shareholders. Companies that list on the Capital Market must also meet all of Nasdaq’s listing rules.

The Nasdaq Capital Market has the fewest requirements. Companies that list on the Capital Market must meet the following requirements:

• Market value of listed securities of at least $15 million.
• Round lot shareholders of at least 300.
• Stockholders’ Equity of $5 million
• Unrestricted publicly held shares of 1 million
• Audited financial statements for the most recent fiscal year.
• Unaudited interim financial statements for the most recent quarter.
• Disclosure of corporate governance practices, including its board of directors’ independence, its executive compensation policies, and its proxy voting policies.
• Compliance with all applicable laws and regulations, including those relating to securities fraud, insider trading, and corporate governance.

The tier of listing that a company chooses depends on a variety of factors, including its financial situation, its growth plans, and its investor base. Companies that are looking to raise capital from the public or that are looking to attract a large number of investors may choose to list on the Global Select Market or the Global Market. Companies that are looking to raise a smaller amount of capital or that are looking to attract a smaller number of investors may choose to list on the Capital Market.

No matter what tier a company chooses, listing on Nasdaq can provide a number of benefits, including access to a large pool of investors, visibility to a global audience, and the ability to raise capital. If you are considering listing your company on Nasdaq, it is important to consult with an investment banker or a securities attorney to discuss your options and to make sure that you meet all of the requirements.

A baby shelf is a provision of Form S-3 that allows companies to register securities for sale up to one-third of their public float over a 12-month period. This can be a useful option for companies that want to raise capital from the public but do not want to have to file a new registration statement each time they want to sell securities.

To qualify for a baby shelf, a company must meet the following requirements:

• The company must have a public float of at least $75 million.
• The company must have been subject to the reporting requirements of the Securities and Exchange Act of 1934 for at least 12 months.
• The company must have filed a Form S-3 registration statement that has been in effect for at least 12 months.

Once a company has qualified for a baby shelf, it can register securities for sale up to one-third of its public float over a 12-month period. The company can sell the securities at any time during the 12-month period, and it does not have to file a new registration statement each time it sells securities.

Baby shelves can be a useful tool for companies that want to raise capital from the public. They can help companies to raise capital quickly and easily, and they can save companies a lot of time and money.

Here are some of the benefits of using a baby shelf:

• Quick and easy access to capital. A baby shelf allows companies to raise capital quickly and easily, without having to file a new registration statement each time they want to sell securities.
• Reduced costs. A baby shelf can save companies a lot of time and money, as they do not have to file a new registration statement each time they sell securities.
• Increased flexibility. A baby shelf gives companies more flexibility in how they raise capital. They can sell securities at any time during the 12-month period, and they do not have to file a new registration statement each time they sell securities.

Here are some of the risks of using a baby shelf:

• Market conditions. The market conditions may not be favorable for selling securities, which could make it difficult for a company to raise capital.
• Investor demand. There may not be enough investor demand for the securities, which could make it difficult for a company to sell them.
• Competition. There may be too much competition from other companies that are also trying to raise capital.

Overall, a baby shelf can be a useful tool for companies that want to raise capital from the public. It can help companies to raise capital quickly and easily, and it can save companies a lot of time and money. However, there are some risks associated with using a baby shelf, and companies should carefully consider these risks before deciding whether or not to use one.

How to Calculate a Baby Shelf

A baby shelf is a provision of Form S-3 that allows companies to register securities for sale up to one-third of their public float over a 12-month period. This can be a useful option for companies that want to raise capital from the public but do not want to have to file a new registration statement each time they want to sell securities.

To calculate a baby shelf, you will need to know the following information:

• The number of shares of common stock that are outstanding.
• The number of shares of common stock that are held by insiders and by institutional investors.
• The public float.

The public float is the number of shares of common stock that are held by the public. To calculate the public float, you will need to subtract the number of shares that are held by insiders and by institutional investors from the number of shares of common stock that are outstanding.

Once you have the public float, you can calculate the baby shelf by multiplying the public float by one-third. This will give you the maximum number of shares of common stock that you can sell under a baby shelf.

For example, if you have 100 million shares outstanding, 10 million shares are held by insiders and by institutional investors, and the public float is 90 million shares, then you can sell up to 30 million shares under a baby shelf.

It is important to note that the baby shelf calculation is based on the public float as of the date of the registration statement. If the public float changes after the registration statement is filed, you may be able to sell more or less securities under the baby shelf.

To calculate the non-affiliate float for purposes of S-3 eligibility, a company may look back 60 days and select the highest of the last sales prices or the average of the bid and ask prices on the principal exchange.

The Initial Public Offering (IPO) Process

An initial public offering (IPO) is when a private company becomes public by selling its shares on a stock exchange. This is a major event for any company, as it allows them to raise capital from the public and become a listed company.

The IPO process can be a complex one, and there are many steps involved. In this blog post, we will take a look at the key steps in an IPO process.

1. Select an investment bank

The first step in the IPO process is for the issuing company to choose an investment bank to advise the company on its IPO and to provide underwriting services. The investment bank is selected according to the following criteria:

• Reputation
• Quality of research
• Industry expertise
• Distribution, i.e., if the investment bank can provide the issued securities to more institutional investors or to more individual investors
• Prior relationship with the investment bank

The issuing company will usually issue a letter of intent to the investment bank, which outlines the terms of the underwriting agreement.

2. Due diligence and regulatory filings

Once the investment bank has been selected, the issuing company must undergo due diligence and regulatory filings. This process involves the investment bank reviewing the company’s financial statements, business plan, and other documents. The investment bank will also file the company’s registration statement with the Securities and Exchange Commission (SEC).

The registration statement must contain detailed information about the company, including its financial statements, business plan, and management team. The SEC will review the registration statement and approve it before the company can proceed with the IPO.

3. Pricing

Once the registration statement has been approved, the issuing company and the investment bank will set the price of the shares. The price of the shares will be based on a number of factors, including the company’s financial performance, the market conditions, and the advice of the investment bank.

4. Stabilization

After the shares have been priced, the investment bank will stabilize the market for the shares. This means that the investment bank will buy and sell shares in the market to maintain the price of the shares at a certain level.

The stabilization process is important to prevent the shares from fluctuating too much in the early days of trading.

5. Transition to market competition

Once the stabilization period is over, the shares will be listed on an exchange and begin trading. The issuing company will now be subject to market competition, and its share price will be determined by the supply and demand for its shares.

The IPO process is a complex one, but it is an important step for any company that wants to raise capital from the public and become a listed company.

Press Release – New York, NY – April 15, 2020 – Securities and Corporate law firm Carmel, Milazzo & Feil LLP (“CMF”) is proud to announce that for the fourth consecutive year, partner Ross David Carmel has been named a “Super Lawyer Rising Star” by Thomson Reuters a distinction reserved for only 2.5% of all attorneys in the New York Metro area.  The announcement will appear in the New York Times.