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Aspects of a Reporting Public Company

A private business entity which may be interested in a reverse merger with a reporting public shell may include the following:

a company for which a primary purpose of becoming public is the use of its securities for the acquisition of assets or businesses;
a company which is unable to find an underwriter of its securities or is unable to find an underwriter of securities on terms acceptable to it;
a company which wishes to become public with less dilution of its common stock than would occur upon an underwriting;
a company which believes that it will be able to obtain investment capital on more favorable terms after it has become public;
a foreign company which may wish an initial entry into the United States securities market;
a special situation company, such as a company seeking a public market to satisfy redemption requirements under a qualified Employee Stock Option Plan;
a company seeking one or more of the other perceived benefits of becoming a public company.

A reverse merger with a private company will normally involve the transfer to the private company of the majority of the issued and outstanding common stock of the public shell company, and the substitution by the private company of its own management and board of directors.

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