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Posted on Jul 11, 2024

Renata begins by telling Mark and Todd about the process. Although Crowe and Mallard charged an underwriter fee of 4 percent on the bond offering,

Renata begins by telling Mark and Todd about the process. Although Crowe and Mallard charged an underwriter fee of 4 percent on the bond offering, the underwriter fee is 7 percent on all initial stock offerings of the size of S&S Air's offering. Renata tells Mark and Todd that the company can expect to pay about $1,800,000 in legal fees and expenses, $12,000 in SEC registration fees, and $15,000 in other filing fees. Additionally, to be listed on the NASDAQ, the company must pay $100,000. There are also transfer agent fees of $6,500 and engraving expenses of $520,000. The company should also expect to pay $110,000 for other expenses associated with the IPO.

Finally. Renata felis Mark and Todd that so files SEC, the company must provide three years audio tells Renata that the company provides audited financial ments as part of the bond covenant, and the company INICASE &S Air Goes Public Mark Sexton and Todd Story have been discussing the future S&S Ait. The company has been experiencing fast growth. statements. She is unsure about the costs of the nd the two see only clear skies in the company's future. wwever, the fast growth can no longer be funded by internal ances, so Mark and Todd have decided the time is right to $300,000 per year for the outside auditor. ke the company public to this end, they have entered into scussions with the investment bank of Crowe & Mallard. me company has a working relationship with Renata Harper. QUESTIONS underwriter who assisted with the company's previous 1. At the end of the discussion, Mark asks Remata abes mnd offering. Crowe & Mallard have assisted numerous sall companies in the IPO process, so Mark and Todd feel Dutch action IPO process. What are the difference in fident with this choice the expenses to S&S Air if it uses a Dutch auction IPO Renata begins by telling Mark and Todd about the process. versus a traditional IPO? Should the company go jubis hough Crowe & Mallard charged an underwriter fee of through a Dutch auction or use a traditional underente ercent on the bond offering, the underwriter fee is 7 percent offering? all initial stock offerings of the size of S&S Ait's offer 2. During the discussion of the potential IPO and SASA Renata tells Mark and Todd that the company can expect future. Mark states that he feels the company stoli ay about $1.800.000 in legal fees and expenses, S12.000 $75 million. However, Renata points out that if the SEC registration fees, and $15.000 in other filing fees. ditionally, to be listed on the NASDAQ, the company must pany needs more cash in the near future, a seva S100,000. There are also transfer agent fees of $6,500 and fering close to the IPO would he problematic, besterade waving expenses of $520,000. The company should also suggests that the company should raise $90 sublice act to pay $110,000 for other expenses associated with IPO. How can we calculate the optimal sise of the . What are the advantages and disadvantages of stress the size of the IPO to $90 million? Ster deliberation, Mark and Todd have decided that the y should use a firm commitment offering with Chapter 15 Raising Capital 533 me & Mallard as the lead underwriter. The IPO will x 875 million. Ignoring underpricing, how much will Sie IPO case the company as a percentage of the funds plan. To sell the stock, the employees can tender their shares to be sold in the IPO at the offering price, or the employees can retain their stock and sell it in the second- ary market after S&S Air goes public. Todd asks you to udvise the employees about which option is best. What would you suggest to the employees? wered? Mang employees of S&S Air have shares of stock in the unapeny because of an existing employee stock purchase Finally. Renata felis Mark and Todd that so files SEC, the company must provide three years audio tells Renata that the company provides audited financial ments as part of the bond covenant, and the company INICASE &S Air Goes Public Mark Sexton and Todd Story have been discussing the future S&S Ait. The company has been experiencing fast growth. statements. She is unsure about the costs of the nd the two see only clear skies in the company's future. wwever, the fast growth can no longer be funded by internal ances, so Mark and Todd have decided the time is right to $300,000 per year for the outside auditor. ke the company public to this end, they have entered into scussions with the investment bank of Crowe & Mallard. me company has a working relationship with Renata Harper. QUESTIONS underwriter who assisted with the company's previous 1. At the end of the discussion, Mark asks Remata abes mnd offering. Crowe & Mallard have assisted numerous sall companies in the IPO process, so Mark and Todd feel Dutch action IPO process. What are the difference in fident with this choice the expenses to S&S Air if it uses a Dutch auction IPO Renata begins by telling Mark and Todd about the process. versus a traditional IPO? Should the company go jubis hough Crowe & Mallard charged an underwriter fee of through a Dutch auction or use a traditional underente ercent on the bond offering, the underwriter fee is 7 percent offering? all initial stock offerings of the size of S&S Ait's offer 2. During the discussion of the potential IPO and SASA Renata tells Mark and Todd that the company can expect future. Mark states that he feels the company stoli ay about $1.800.000 in legal fees and expenses, S12.000 $75 million. However, Renata points out that if the SEC registration fees, and $15.000 in other filing fees. ditionally, to be listed on the NASDAQ, the company must pany needs more cash in the near future, a seva S100,000. There are also transfer agent fees of $6,500 and fering close to the IPO would he problematic, besterade waving expenses of $520,000. The company should also suggests that the company should raise $90 sublice act to pay $110,000 for other expenses associated with IPO. How can we calculate the optimal sise of the . What are the advantages and disadvantages of stress the size of the IPO to $90 million? Ster deliberation, Mark and Todd have decided that the y should use a firm commitment offering with Chapter 15 Raising Capital 533 me & Mallard as the lead underwriter. The IPO will x 875 million. Ignoring underpricing, how much will Sie IPO case the company as a percentage of the funds plan. To sell the stock, the employees can tender their shares to be sold in the IPO at the offering price, or the employees can retain their stock and sell it in the second- ary market after S&S Air goes public. Todd asks you to udvise the employees about which option is best. What would you suggest to the employees? wered? Mang employees of S&S Air have shares of stock in the unapeny because of an existing employee stock purchase