INTRODUCTION

In the fall of 2008, companies that were pursuing initial public offerings had to put their dreams on hold following the collapse of the financial services industry. Although the prospect of an initial public offering continued to be a topic of discussion among high quality, rapidly growing companies, it was not until the last half of 2009 that the IPO market started to come back to life with strong performances from companies like SolarWinds and Fortinet. While the capital markets remain fragile, we are starting to witness a renewed sense of optimism from many of the players in the IPO market, including investment bankers, venture capitalists and emerging growth companies, especially those in the technology, life sciences, and energy and clean technology industries. Given this development, we felt that the time was right to update our Guide to the Initial Public Offering to provide a new set of readers with an overview of the most important aspects of planning, launching and completing a successful IPO.

We have organized this booklet into three major chapters. In Chapter One, we discuss the period leading up to a decision to proceed with an initial public offering, with a focus on the prerequisites to, as well as the costs and benefits of, proceeding with an initial public offering and becoming a public company.

In Chapter Two, we turn to the period beginning with the decision to proceed with the offering and continuing through the closing of the sale of the shares to the public. We first describe the events and legal restrictions encountered prior to the filing of the registration statement with the Securities and Exchange Commission (the ‘‘SEC’’). We include an overview of the process and factors impacting the timing of the offering, the members of the working group and their respective roles during the process, structural and organizational issues affecting the offering, preparation of the registration statement, and the ‘‘due diligence’’ process. This ‘‘pre-filing period’’ is followed by what is often called the ‘‘waiting period,’’ during which time the company responds to comments to the registration statement from the SEC and markets the offering to potential investors in what is referred to as the ‘‘road show.’’ Once the company completes the SEC comment process and marketing, it will ask the SEC to declare the registration statement ‘‘effective,’’ at which timethe company can begin selling stock to the public.

In Chapter Three, we conclude with a discussion of certain consequences of becoming a public company, including the company’s disclosure obligations, corporate governance requirements, and the trading restrictions and reporting obligations applicable to the company and its directors, executive officers and other affiliates.1

The initial public offering should not be viewed as an end point or ultimate goal. Rather, it is one step in the growth and maturation of a business enterprise. This booklet is intended to provide a high-level perspective on this exciting process and the key issues that impact it.

As a final cautionary point, please note that this booklet does not attempt to address all existing laws or regulations applicable to the subjects covered. The booklet summarizes certain of the applicable statutory and regulatory provisions and, in the interest of brevity, is deliberately incomplete. In making legal determinations, you should not rely on this booklet but rather on the advice of experienced corporate and securities counsel.