Page 76 - Initial Public Offering - An Introduction to IPO on Wall Street

Limitations could be based on debt, legal contracts, or the regulatory framework in which a
business operates.

Capitalization—Although not a prerequisite of Regulation S-K, a firm’s capital structure, both
before the bid and after the selling of all securities sold, is typically exhibited in a tabular
format.

Dilution—If there is a difference between the price of the IPO and the net tangible asset value,
dilution results. It is important to report the impact of any asset dilution on potential investors;
this is typically provided in a table of dilution.

Underwriting and Distribution of Securities—Details on the pricing of the securities being
issued, the participants of the cartel of underwriters, the sort of underwriting and any
connection between a business and any of its underwriters must be presented.

 Information about the Company’s Business—An organization must make detailed
disclosures about its business. The following are these disclosures:
 Business plan of a company, especially if it has operating results for less than three years;
 A summary of the key divisions, goods, services and markets of the firm;
 A summary of the properties thereof;
 If any, information concerning international operations;
 Sum of investments related to research and development;
 Industry and business regulations;
 Judicial cases, pending or threatened; and

 Profits, earnings, assets, goods and services, product development, order queue of major

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