Reverse Merger Info by rambling2

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									PUBLIC COMPANY MANAGEMENT SERVICES WHITE PAPER
The Affordable IPO Alternative
Smaller businesses that want to enjoy the benefits of “going public” have several alternatives, the most famous of which is the Initial Public Offering (IPO). It’s the most famous because it’s the route of choice for the world’s largest companies, and therefore gets mentioned most in the financial and general press. It’s also the most expensive, the lengthiest, and the riskiest method of taking a company public. Less well known is the Reverse Listing, by which a private company purchases a public company and, through a reverse merger process, becomes traded on the Over-theCounter Bulletin Board (OTCBB). This process is an affordable alternative to the IPO for smaller companies that can benefit from being public but don’t have the money or time or risk tolerance to structure an IPO. It’s the right way for companies with $5-25 million in annual sales to go public. This white paper covers the following:
• • • • • • the benefits of going public how a Reverse Listing works how it differs from an IPO how long it takes how much money it requires how to find competent and qualified professionals to help you through the process

It also answers the questions most frequently asked by companies thinking about or going through the process.

This memorandum is provided by Public Company Management Services for educational purposes only and is not intended and should not be construed as legal advice. 2004 © Public Company Management Services 5770 El Camino Road. Las Vegas, NV 89118 Phone: (702) 222-9076 http://www.pubcowhitepapers.com http://www.pcms-team.com http://www.foreigncompanylisting.com http://www.gopublictoday.com

The Affordable IPO Alternative
Smaller businesses that want to enjoy the benefits of “going public” have several alternatives, the most famous of which is the Initial Public Offering (IPO). It’s the most famous because it’s the route of choice for the world’s largest companies, and therefore gets mentioned most in the financial and general press. It’s also the most expensive, the lengthiest, and the riskiest method of taking a company public. Less well known is the Reverse Listing, by which a private company purchases a public company and, through a reverse merger process, becomes traded on the Over-the-Counter Bulletin Board (OTCBB). This process is an affordable alternative to the IPO for smaller companies that can benefit from being public but don’t have the money or time or risk tolerance to structure an IPO. It’s the right way for companies with $525 million in annual sales to go public. This white paper covers the following: • • • • • • the benefits of going public how a Reverse Listing works how it differs from an IPO how long it takes how much money it requires how to find competent and qualified professionals to help you through the process

It also answers the questions most frequently asked by companies thinking about or going through the process.

What are the benefits of going public?
Going public is often the best way for an already successful business to raise capital. The reward for success is growth – by expanding the company, by hiring new people, or by opening additional locations. All these initiatives take capital. If your cash flow can’t generate the capital you need, taking your company public allows others who believe in your potential to support your goals and benefit from them. Second, going public can provide entrepreneurs with an exit strategy. As they approach retirement, they can distribute some of their shares to their heirs, protect their assets using powerful strategies available only to owners of public companies, and plan for their retirement. A third benefit is the ability to use stock to purchase additional companies. Fourth, public stock is a great tool for rewarding loyal employees and attracting new employees. Fifth, taking your company public is the most powerful personal wealth building strategy in our economy.

How does a Reverse Listing work?
The first piece of the puzzle is to start with a clean public company. This should not be a company that has just been found and allegedly cleaned up, but one that has been operating and reporting according to SEC regulations. The company should have had operations that were “above-board” or, in the case of developmental stage companies (DSCs), they have had little or no functional operations. An SEC peerCorporate Office 5770 El Camino Road Las Vegas, NV 89118 Registered Investment Advisor Stephen Brock President and CEO 1 Tel (702) 222-9076 Fax (702) 920-8176

recognized accountant who is part of the filing needs to certify this in an audit. To avoid the appearance of fraud, the public company must be a true, clean company. The ideal candidate is a public company that at one time may or may not have had operations, but currently has few assets, low earnings and minimal operations. Often, it’s a company that would operate better as a private venue and realizes that its corporate hull has value in the marketplace. Such a company is not necessarily in trouble – it would just benefit from a structural change. The company agrees to be acquired by one of the public entities in a Reverse Listing, also called a reverse merger transaction. It’s called a reverse merger because the private company absorbed into the public company (really nothing more than the old company but in a different corporation) is the legal entity that survives.

How does it differ from an IPO?
A Reverse Listing can be completed, soup to nuts, within 4-6 months. An IPO, by contrast, typically takes between one and two years to finalize. A Reverse Listing will cost around $750,000, while an IPO will run anywhere from $2 million and up. (From 1996 to 1999, the average IPO cost close to $5 million.) IPOs are inherently riskier than Reverse Listings, because the value of the trading company is determined by market conditions over which you have no control. Depending on the timing of the IPO, potential investors can be excited or terrified to invest in your company.

What are the specific steps in the process?
• • You (the owner of the private company desired to go public) sign a preliminary merger agreement with the publicly traded company. A Corporate Finance specialist sends the company a Due Diligence Questionnaire and begins to work with them to complete it; this becomes the backbone of the filings required to complete the transaction. The purpose of the questionnaire is to simplify the process of gathering the necessary data from the company. A corporate finance specialist should be made available by any firm you work with to provide hands-on help in completing the questionnaire. • The private company ideally completes the information questionnaire and forwards it to the firm facilitating the transaction company. Once the completed questionnaire has been received, the disclosure part of the filing can begin to be written. The public company will simultaneously work on its “valuation analysis.” The purpose is to determine, from their perspective and using their own methods, the monetary value of the company. Typically, one specific valuation method works the best, although several may have been utilized. (For more information, see the Pubco White Paper on “Valuation Techniques.”) Don’t rely on this valuation, though. Hire a third-party valuation expert to corroborate or correct the public company’s own determination of value:

•

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Here’s why correct and credible valuation is so important: effective promotion of the aggregate company after it starts trading is a key element of the long-term success of the merged entity. If the company is promoted well, the stock price rises. If nobody knows about the stock, it falls – sometimes plummets. Missing one small but important aspect of the valuation can be a death knell to the entire arrangement. When valuation is done correctly, the company will save more than the entire fee in investor relations and public relations expenses they would typically incur to promote the stock once it has started trading. Better yet, the market for trading in the stock will have opened up to 20 or 30 times more potential purchasers and their stockbrokers. Hiring a third party for a valuation is usually money well spent, assuming you hire a “true pro” with experience valuing public companies entering into Reverse Listings. • The process requires audited financial statements. The next step is to retain an accountant and start the audit process. Remember, a qualified SEC accounting firm - a firm that is a member of the AICPA SEC Practice Division, must do the audit. Even if an audit is performed, if such a firm did not do it, it will have to be redone before the SEC filing can be made. Be careful here – not all accountants are peer-reviewed (the qualification for conducting audits for SEC purposes). If the company’s annual revenues are less than $25,000,000, it needs two years of audited financial statements. Three years of audited financial statements are needed if the revenues are in excess of $25,000,000 per year. If the company has been in business for less than these time periods, the company need only provide an audit for the period of time they have been in existence. • • • When the filing document is complete, it will be sent it to the accountants for review and comment. When they are done, an accountant’s consent to file must be secured. The public company files with the SEC. Shortly after filing with the SEC, the public company’s Market Maker will file a listing application with the National Association of Securities Dealers, Inc. (NASD). Remember that there are two separate and distinct regulatory agencies that must be cleared in order to trade—the SEC and the NASD. All broker/dealers in America must be NASD members. The next step is for the new entity to clear the SEC. The merger is then “closed.” Following SEC clearance, the merged entity must clear the NASD. Then the merged entity can start trading.

• • • •

What are the fees and costs associated with the Reverse Listing?
The goal of the Reverse Listing is to be much more affordable than a traditional IPO. Here is a sample schedule of fees, with expenses in bold, and optional items noted.
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EXPENSE {* = Optional} SEC Accountant

AMOUNT $2,500 (no activity ever) up to and over $25,000+

Corporate finance specialist’s assistance in completing the If it is wished, he visits the office to assist the Due Diligence Questionnaire. (This fee is included in the company; the company must pay all the travel transaction bucket price.) expenses. Edgarization * 506 Blue Sky (needed only if you do a 506 offering) $2,500 - $10,000+. Varies

* 506 Legal Opinion (needed only if a company wants to Note: SEC filings are often “repurposable” into remove the disclaimer about their attorney not providing a 506, but they will not have a legal opinion. If a any due diligence or opinion from the cover page of the company desires one, an additional expense of 506 offering memorandum) $10,000 - $25,000 should be budgeted. SEC filing fee Transfer Agent * Investor Relations/Public Relations Firms The company’s legal counsel (See below) S&P Listing Less than $1,000, unless the company has substantial assets. Usually about $1,500-3,000 to set up and issue initial shareholder list. On-going costs vary. Not required. Fees vary widely. Not required for SEC work. May be needed for corporate work to be done in connection with the filing. Necessary for secondary trading. First year $5,000. Follow on years approximately $2,500. Note: This only covers 24 states. For additional states, Blue Sky filings must be made. The SEC may require the company to print and deliver prospectuses. The cost could be up to $5,000 or more, depending on the number of sellers. Less than $250

Printing

CUSIP Number

What are the legal issues I need to be aware of, and how do I get them handled?
A single law firm can do the entire SEC filing work. However, note that such a firm typically doesn’t represent the private company because it represents the public company acquiring the private corporation. Representing the private company at the same time would constitute a conflict of interest. The private company does not need separate legal counsel in the process unless they want it. If you hire your own counsel, the counsel won’t have to do any SEC work, give legal opinions to the SEC attorney, or draft any part of the filing. In effect, they would only be corporate counsel hired to advise your company on general business matters.

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

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Who do I need as part of my “dream team” for a Reverse Listing?
o o o Corporate finance firm who crafts the key documents. Attorney with experience in taking companies public. The market maker, preferably a firm who is one of the most, respected Market Maker for the OTC Bulletin Board. It is beneficial if they are familiar with filing Form 211’s each year and one with significant trades of bulletin board companies at any one time.

I’ve heard that the SEC doesn’t approve of reverse mergers. What should I do to stay on their good side?
The SEC is cracking down on illegal reverse merger programs. Your Reverse Listing can be scrutinized and shot down if not facilitated by an experienced team.

How long does it take until my company is trading publicly?
There are no shortcuts to Wall Street. Most companies going through the process hope the answer is 30 days. Some firms that take companies public tell their potential clients two to three months. The truth is that the process can take four to six months, or even slightly longer. Based upon experience, the average time for the process is 4-6 months. Even with the best, most experienced people on your dream team, this is still a complicated process with many factors contributing to the time it takes to get the company trading. The SEC comment letter-process is where companies can get into real trouble. Every comment letter guarantees at least another 45 days of SEC review. And depending on the nature of the comment, you could spend anywhere from one day to six months to fix the problem or collect the missing data. There are companies who never manage to go public via Reverse Listing because they keep receiving SEC comment letters. That’s a very good reason to work with a team with a history of success. The following is a going public/becoming trading timeline. • Corporate finance specialist sends out the Due Diligence Questionnaire and begins to work with the company to complete it. Time: 3 days - 3 months. • The company completes the questionnaire and sends it back to the firm. They will begin writing the disclosure part of the filing once they have received the completed questionnaire. Time: 1-2 weeks, or more. This process could take more than the average 1-2 weeks if a risk management program is incorporated into the process. That can create timing problems. Problems with the company’s contracts, even when correctable, can also create timing delays. Implementing the appropriate response to risks identified under the individually tailored risk management based program takes time.

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

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•

The company must provide audited financial statements. Time: 2-4 weeks with little or no operations. 4 or more weeks if the company has had significant operations.

•

When the filing document is complete, it is sent to the accountants for review and comment. When they are done, the accountant’s consent to file must be secured. Time: 1-2 weeks.

•

The company may be in the process of raising money. However, the SEC prohibits them from raising money after they file with the SEC. A private placement under Regulation D Rule 506 may be made before they file. All stock sold in the private placement will be made free trading after the SEC clears the filing and the merger closes. Of course, officers, directors, and insiders will always be subject to Rule 144 resale restrictions. Time: assuming the company finishes raising money before they file, there is no additional delay.

• •

Then, the public company files with the SEC. Shortly after filing with the SEC, the Market Maker will file a listing application with the NASD. There are two separate and distinct regulatory agencies that must be cleared in order to trade, the SEC and the NASD. All broker/dealers in America must be NASD members. The next step is to clear the SEC. Time: 75-90 days.

•

• •

The merger is closed. Clear the NASD. Time: 2-3 weeks.

The total time frame is explained in the chart below. Event The filling out of the questionnaire and the writing of the filing document Audit Secure Accountant’s consent SEC review NASD clearance TOTAL Time 2 weeks [very optimistic]. 3 weeks – so add 1 more week here. Assume 1 more week. Assume 75 days – 11 weeks. Assume 2 weeks. 17 WEEKS (with pretty optimistic assumptions)

This process will take 4 months minimum. Anyone who tells you otherwise values your business more than their own integrity.

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

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How many free trading shares does the new company get?
Restricted shares are “restricted” because the SEC imposes certain restrictions on their resale. These restrictions govern the amount of the shares that can be sold and the manner in which they must be sold. They also cannot be sold without a legal opinion that all restrictions were met. These are sometimes called Rule 144 shares, named after the rule containing the restrictions. (For more information, see the Pubco White Paper on “Rule 144.”) There are two types of restricted shares: Those owned by officers, directors, and control persons, who are called “insiders” or “affiliates.” Shares owned by these types of people are always restricted.. For more information, read the following Pubco White Papers: Investor and Shareholder Protection Independent Director SEC Filing Schedule Shares purchased in a private placement transaction, which is sometimes referred to as a Reg. D or a Rule 504, 505, or 506 transaction are also restricted shares. The offering documents in this kind of transaction – commonly called a Private Placement Memorandum or PPM – are not filed with the SEC before the company sells. To contrast restricted shares with free trading shares, free trading shares are issued only after the offering documents – called a Registration Statement or Prospectus – are filed, reviewed and declared effective by the SEC. The documents that the broker/dealer will prepare for the private company will be filed with, reviewed, and declared effective by the SEC before we close our merger transaction. This means in our transaction after the merger closes: • • Shares issued to the Non-Insider shareholders are all free trading, even if they were sold in a private placement just before the company filed. Shares issued to the Insider shareholders are always restricted.

As many free trading shares as desired can be obtained; this is not the end of the answer. The real answer depends on the company’s valuation as determined. Only one specific valuation method works correctly to get to the right number. As I mentioned earlier, you will save more on a correct valuation than all the investor relations and public relations expenses you will incur to promote your stock once you start trading.

What does the SEC do when it reviews the filing?
There are many common misconceptions about what the SEC does. The two most common are that the SEC: • • Passes judgment on the merits of all aspects of the business Approves the filing and advises the NASD that is acceptable to start trading immediately

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

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The SEC does not in any way pass judgment on the merits of the filing, and does not have a particular specified way they want the company to answer their questions. In completing a Due Diligence Questionnaire, questions bubble up like: • • What if the SEC doesn’t like certain aspects about the company? What does the SEC want it to say in response to specific questions?

These comments suggest that people think that the SEC engages in some kind of merit review of filings. They don’t. Rather, what they do is engage in a disclosure review of filings. The disclosure review works as follows: When the company sends in its filings, the SEC responds with a Comment Letter. The best way to explain this is through the example of a general contractor. When a house is just about done, the GC does a walk-through with the owner. The owner looks at all the plans and specs. There are few things that don’t meet the plans and specs, so the contractor draws up a punch list. When all the items on that list are punched, they receive their final payment. The whole disclosure-based system used by the SEC to process the filing can be thought of in the same way. The company is the contractor and the SEC is the owner. Their regulations are the plans and specs. When the first filing is submitted, they compare what the company is required to say under their regulations against what the company actually said. They then send you a punch list, called a Comment Letter. Generally, it takes one or two more submissions to clear up all the comments. Another common misconception is that the SEC approves the filing. The SEC never approves anything. What they do say is that they are not going to send the company any more comment letters because they have no further comments on the filing. They then tell the company that their filing is now effective. Not approved — effective. Finally, I have found that many people mistakenly believe SEC approval is the end of the process. People think, “SEC clears filing, trading starts immediately – just like flipping a switch.” This is not true. Remember, there are two separate and distinct regulatory agencies that must be cleared in order to trade—the SEC and the NASD. Clearing the NASD takes a couple more weeks.

What is a quiet period? What can and can’t my company do during a quiet period?
A quiet period is the period between when your company first files with the SEC until they declare the filing effective. Your company has to stop raising money during the quiet period. You need to have at least enough money to carry you through the 75-90 day SEC review process. Remember in your financial planning to assume the best, but plan for the worst. Concerning what can or can’t be said, note that there is a difference between being quiet and being gagged. Your company can respond to unsolicited questions from the press; however, the key word is unsolicited. Be careful—what you may perceive as unsolicited might not actually be. A CEO of a dot.com company was recently interviewed by Business Week and featured in an article about the brightest 25 Internet entrepreneurs. The article appeared during the quiet period of his company’s IPO. Unfortunately for the CEO, someone else in his company had solicited the article. If a situation like this occurs, the SEC stops the review process for an unspecified amount of time (subject to their discretion). Although the company may continue to issue press releases about their business, this area is also a little tricky. To avoid violating quiet period restrictions, a long history of issuing similar releases
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starting well before your filing must be shown. Your company can still be penalized if you promote the filing in the releases. If your company does engage in “legal talking” during the quiet period, make sure it doesn’t say anything that isn’t in the filing. The filing does not have to be read verbatim, but if you paraphrase, paraphrase very closely. Otherwise your company may end up in violation.

What does a Transfer Agent do?
All companies are required to have a stockholder list certified by a Transfer Agent for the NASD listing application. A Transfer Agent does the following tasks: • • Keeps a current list of all the company’s stockholders. Processes the paperwork when people buy or sell the stock.

Transfer Agents are regulated by the SEC and must comply with many regulations. It is commonly thought that a Transfer Agent sends the filings to the SEC and NASD. This is not true. As an aside, when the company files, the SEC requires them to convert their Word or WordPerfect files to some arcane hypertext format in a process called “Edgarization.” It is called “Edgarization” because the SEC’s electronic filing program is called EDGAR. Edgarization may not be done by the company; instead, someone who knows how to work an Edgarization program must do it. All of these numbers, columns, and bullet points can be tricky to convert. Some companies use a financial printer, an Edgarization service, or an SEC accountant. It averages about $2500 – 10,000 total to have all filings Edgarized.

What will the Market Maker do for my Company?
One of the most commonly misunderstood players in a going public transaction is a Market Maker. Common questions about Market Makers include: • • • How will the market maker promote the company’s stock? How much money can the market maker raise for the company after it goes public? The company needs many market makers. How many can be brought in?

The answer to all of these questions is negative (He won’t, none, and none). A Market Maker is passive, not active. He matches orders and keeps an orderly market. Market Makers do not promote the company’s stock. Investor Relations/Public Relations firms do. Market makers also do not raise money. If a company can’t identify and raise money from funding sources themselves, it is really difficult to secure financing. Going public using this method can make it much easier to raise money from funding sources you have already identified, because their investment will be much more liquid. If you get your stockholders free trading shares, you’ve gone a long way to answering their biggest question: “How do I get my money back?” (For more information about how to pitch to investors, see the Pubco White Paper, “Are You Making These Seven Investor-Scaring Mistakes?”)

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Registered Investment Advisor Stephen Brock President and CEO

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Per NASD regulation, only one Market Maker may submit a listing application, and that Market Maker has an exclusive contract for the first 20 trading days. The Market Maker does not charge any cash or stock to file the Form 211 because it is against NASD rules to do so. He makes his money on trading, and he has an exclusive on trading for the first 20 business days you trade.

What does the NASD look at when they review the company’s listing application?
The process used by the NASD and the SEC review processes are completely opposite. The SEC has a giant published list of plans and specifications, while the NASD has nothing. Their only requirement is that the company must be an SEC reporting company. And what they indicate can be very misleading, as it is their published position that there are no other requirements. Contrary to what the NASD leads people to believe, experience indicates requirements in the following areas: • • • • Minimum shareholder Shareholder relationship Minimum free trading share numbers Specified share distribution pattern

The SEC can be cleared and the company still may not get listed if it doesn’t get it right. Experience has also dictated that although the NASD uses merit review, their focus is limited to just a few issues. The merit of the business itself is not one of them. I can’t give you more specific information about this final hurdle, the NASD, because their criteria are nebulous and mysterious. For any particular Reverse Listing, my team and I can predict with a high degree of confidence what issues will be important to the NASD, and how to structure the Reverse Listing for the highest probability of easy clearance.

There are so many steps? How do I find and coordinate all the pieces and people I need to get the job done?
Typically, that’s been a huge barrier to entry for small companies seeking to go public. The process is so complicated, and the error tolerances so small, that finding and orchestrating all the experts and professionals needed to go public via Reverse Listing has been unrealistic even for business owners who could benefit tremendously. To solve that problem, I’ve created a Broker/Dealer entity, M&A Capital Advisers, LLC that operates on a turnkey model. We become your General Contractor, and manage all the other professionals involved in taking you public. Here’s a partial soup-to-nuts list of what we handle: Education and Planning • Merger strategy • Target identification and analysis • Board and management education Financial Configuration • Transaction structure
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• • •

Pro forma analysis Earnings and capital dilution Market value analysis

Execution • Marketing • Due diligence • Negotiations • Regulatory approval • Fairness opinion/offer evaluations I’ve structured it this way so everybody can do the job they do best. My experts handle the SEC and NASD and Market requirements, and my clients run and grow their businesses.

What’s my next step?
If you’ve read this far and still feel that your company qualifies for and you can personally benefit from a Reverse Listing, your next step is to determine if you have the available cash reserves and/or ongoing cash flow to pay for the process and sustain your business during the SEC review period. Next, shop around for your “dream team.” Remember that this is an extremely complicated process, as well as a potentially lucrative one for all involved. This combination means that many charlatans and amateurs are out there preying on entrepreneurs looking to reach the “big time.” Use the criteria and questions presented in this White Paper to evaluate the people who are offering to take you public via a Reverse Listing. See how long they tell you the process will take. Ask them the questions I answer here, and see if they respond with integrity, ignorance, or greed. Ask them about their experience and qualifications. Ask them about the companies they’ve taken public, and how they’re doing. You don’t want someone to agree to take you public unless you’re likely to succeed as a public company – make sure the broker/dealer you engage is doing at least as much due diligence on you as you are on them! Find out up front about the broker/dealer’s compensation model. Ideally, their upfront fee pays their expenses, and they make their “real money” from shares of your stock. That’s how you find people who are truly committed to your success.

OK, I’ll bite. What are your qualifications and experience?
My company, M&A Capital Advisers, LLC, executes Reverse Listings for clients who qualify. It is an NASDcertified broker/dealer, CRD number 129498 and SEC number 8-066231. My “dream team” – and yours, if we end up working together – consists of the following people: Michael T. Williams, ESQ. Williams Law Group, P.A., Tampa FL After leaving a management and in-house counsel position with a large private healthcare firm, Mike developed a boutique corporate and securities practice focused almost exclusively on taking small companies public that do not qualify for traditional IPO transactions.

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

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He is currently assisting or has assisted approximately 20 companies going public through the filing of registration statements on Form SB-2 as well as filings on Form 10-SB. Eight of these companies received ticker symbols, and it is anticipated that more will receive ticker symbols before the end of this year. He worked for a Florida firm for 11 years where his main responsibilities were the preparation of and filing all major types of filings with the SEC, including registration statements, annual and periodic reports, and stock transfer tracking forms such as Forms 3 and 4. In addition, he prepackaged private placement memoranda and related blue sky filings, and participated in structuring and negotiating many corporate transactions, drafting related documents including merger and acquisition agreements, asset purchase and sale agreements, employment contracts, and partnership agreements. Most importantly, Mike worked for five years with the U.S. Securities and Exchange Commission (SEC), Washington, D.C. He conducted investigations and secured judgments against individuals and corporations for violations of federal securities laws, including Fortune 500 companies. Jane E. Baynard The Baymen Group Prior to joining Baymen, Jane E. helped co-found the Private Placement Group for Interstate Johnson Lane Securities, an NASD registered broker-dealer. As a co-founder of the Private Placements group she was instrumental in developing a strategy for penetration into the regional private corporate market. Responsibilities included managing relationships with existing and potential clients, conducting due diligence and writing private placement memorandums. She was also responsible for establishing product structure and pricing for individual debt and equity transactions in the private market. Prior to joining IJL, Jane E. served as Vice President of NationsBanc Capital Markets, Inc. a Section 20 investment banking firm focused on serving Fortune 500 clients’ debt and equity needs through myriad security and derivative products. Jane E. has also worked with Madison Keats, Management Consulting Services and ICG Capital Partner where she has performed business valuation, financial analysis, equity research reports and capital sourcing services. Jane E. earned an MBA from UNC Chapel Hill and holds a Bachelor of Arts Degree in Economics from the same institution. Jane E. has authored several books designed to assist company management operate more efficiently. She also has written a number of articles on financial, management and venture financing issues for various publications. Aldo Rotondi Airam Capital Aldo Rotondi began his business career in 1986 with his private Architectural Design/Build company; Rotondi Design & Associates. For 6 years with his design team, he was involved in all aspects of development from commercial developments to residential condominium developments both in the US and Canada. His last design/build project that he was involved with was to redevelop a motel and convert it to a new Super 8 Motel Franchise. This project sparked Aldo’s focus to develop Super 8 Motels in Eastern Canada. With 2 other partners, CF Hospitality, Inc. was started whereby the company now owned the Franchise Rights to the Super 8 Motel Chain for Eastern Canada. Aldo was Vice President of Development for CF and helped them grow the chain from 2 properties in Eastern Canada to 25 franchised properties. Of these franchised properties, CF Hospitality corporately owned 9 properties. In 1997 a buyout of CF Hospitality's Corporate properties by Wesmont Hospitality turned Aldo’s focus toward starting a new development company called Royop Hospitality Corporation. Royop became a publicly listed company on the Toronto Stock Exchange that now held the rights to the Franchise Rights to the Super 8 Motel Chain for all of Canada as well as the franchise rights to Wingate Inns. By working with Cendant

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

12 Tel (702) 222-9076 Fax (702) 920-8176

Corporation, Royop expanded its Super 8 Franchise base from 28 Super 8 properties to over 60 franchised properties where Aldo was in charge of Franchise Developments for Royop Corporation. In 1998 Aldo left Royop Corporation (which was later acquired by a US REIT) to found and act as president of Airam Capital Group, Inc. that seeks out private business opportunities that may be better served as public companies. As principal for various public companies, he seeks out mergers with private companies that will enhance shareholder value. Airam Capital works together with Nevada Fund, GoPublicToday.com, Management Consulting Group assisting with strategic investment and acquisition services for early-stage companies in support of investment and M&A focus providing strategic consulting and business development services. John Malone Malone & Bailey, PLLC John C. Malone, JD, CPA is managing partner of Malone & Bailey, PLLC, a certified public accounting firm specializing in audits and taxation of small publicly-held (SEC regulated) companies in the United States and Canada. Malone & Bailey currently have about 80 public company clients, ranking them #7 of all U.S. accounting firms in number of SEC clients. Their success formula is SEC rule competence through their large specialty practice base, which leads to faster service and lower prices. John is also audit committee chairman of the board of directors of North American Technologies Corporation, a small publicly held company specializing in composite railroad tie manufacturing.

What is your compensation model?
We structure deals so that we make money when you make money. Most of our compensation comes in the form of your company’s stock. That’s how we resist the temptation to take companies public that shouldn’t be public. And that’s how we make sure we continue advising and guiding you once your company becomes publicly trading. We make sure you stay in compliance with SEC and NASD regulations so you can keep and benefit from your new ticker symbol.

Can I talk with you about going public without making any commitment?
To find out whether going public is right for you, I invite you to sign up for my free “Open Line.” We’ll spend 15 minutes looking at your business, your business plan, and your goals, and together figure out what you need to grow your business to the next level. I have developed a fast-track phone consultation, which will help you find out. It's called 'Go Public Open Line' and they are held on Tuesday’s and Friday's. There are only 8 TIME SLOTS available each Tuesday or Friday and they will be assigned on a first-come, first served basis. This consultation normally costs $85.00 but on Open Line days *only* it is free. The stock markets are stronger then they have been in years. Now is a great time to see if you have what it takes to become a public company, and I can tell you. Being public is not for everybody. But it is a brass ring and a powerful tool to grow your business. You may have already decided after doing your due diligence on me and my firm that its right for you, and I am the right person to help you get there. I can not encourage you enough that taking the time to gather as much information as you can about the going public fund raising tool will help you determine if this is the way to go. I also encourage you to take the
Corporate Office 5770 El Camino Road Las Vegas, NV 89118 Registered Investment Advisor Stephen Brock President and CEO 13 Tel (702) 222-9076 Fax (702) 920-8176

time to review other firms like mine so you can choose the right one for you. Some are licensed like I am, and many others are not. I have 4 other white papers that educate you about going public. I encourage you to read those as well. Plus, once you sign up – I will immediately send you a Paper called “Wealth Building By Going Public.” Here's what to do: Go to http://www.gopublictoday.com/openline.php and complete the form. Many other companies are reading this white paper and there is only time for 8 appointments on Tuesday and Friday, so don't wait. If you would like to know some of the companies I have taken public, go to http://www.gopublictoday.com/clients.html. If you do enough research you will find that AZAA was able to receive a 6 million dollar ($6,000,000) commitment to help expand their business. This occurred once they were public. I look forward to talking with you. Sincerely, Stephen Brock (702) 248-4798 Principal, Go Public Today http://www.pubcowhitepapers.com

Corporate Office 5770 El Camino Road Las Vegas, NV 89118

Registered Investment Advisor Stephen Brock President and CEO

14 Tel (702) 222-9076 Fax (702) 920-8176


								
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