its section 3(b)(2) offering. Under current law, if an issuer were to seek to list its securities on a national securities exchange in conjunction with, or following the completion of, a section 3(b)(2) offering, it would be required to prepare and file with the SEC a registration statement on Form 10. Many of the comment letters submitted to the SEC on Title IV of the JOBS Act have suggested that the SEC modify the approach to Exchange Act registration for those issuers that choose to use a section 3(b)(2) offering as an IPO. Now, of course, an issuer that qualifies as an emerging growth company also would be able to avail itself of the Title I on-ramp approach. A traditional IPO, even with the accommodations now made available to emerging growth companies by Title I, may not be a realistic alternative for smaller companies. Many investment banks will only undertake an IPO if it is of a certain size, and smaller companies may still seek to undertake IPOs in which they offer up to $50 million in securities. For smaller IPOs of the sort that were once common in the United States, the section 3(b)(2) alternative may prove the only realistic approach. Ultimately, however, and as noted in the GAO study on Regulation A offerings, the utility of the new exemption will depend entirely on the implementing rules and whether the rules address state blue sky pre-emption and information requirements appropriately.


56 JOBS Act Quick Start


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