Form 10 Registration Statement

A Form 10 Registration Statement is a registration statement is used to register a class of securities pursuant to Section 12(g) of the Securities Exchange Act of 1934. A Form 10 registration statement is not used to register specific securities for sale or re-sale and does not change the transferability of any securities. Following the effectiveness of a Form 10 registration statement, restricted securities remain restricted and free trading securities remain free trading.  A Form 10 Registration Statement is mainly used by companies seeking to establish a quote on the over-the-counter markets, if they have used an exemption from registration under the Securities Act of 1933 to sell stock to investors.

The Purpose of Form 10 Registration Statements

           Any Company with in excess of $10,000,000 in total assets and 750 or more record  shareholders is required to file a Form 10       registration statement with the Securities and Exchange Commission (“SEC”). In addition, any company, whether                     publicly held or not and with or without assets, may voluntarily file a Form 10 registration statement at any time. A Form 10 registration statement automatically  becomes effective sixty (60) days following filing.

Upon effectiveness the Company which filed the Form 10 registration statement is subject to the reporting requirements of the Exchange Act. That is, they must file annual reports on Form 10-K, quarterly reports on Form 10-Q and periodic reports on Form 8-K. In addition, such Company is then subject to the proxy rules in Section 14 of the Exchange Act, and ownership rules and reporting requirements in Sections 13 and 16 of the Exchange Act.

What Makes a Company Public?

Even though a Company that files a Form 10 registration statement becomes subject to the reporting requirements of the Exchange Act, a Form 10 registration statement does not make a company public, and there is no pre-requisite that a company be public prior to filing a Form 10. A public company, by definition, has public shareholders. A Form 10 registration statement can be filed by an entity with a single shareholder. Moreover, regardless of the filing of a Form 10, a Company must satisfy other regulatory obligations to trade on either the over the counter market (PinkSheets or Bulletin Board) or on an exchange (AMEX; NASDAQ; etc.). A prerequisite to trading on either the over the counter market or an exchange, would be to have public shareholders holding freely tradeable shares. A Form 10 does not impact upon this requirement.

Following the changes in Securities Act Rule 144 in February 2009, a Form 10 registration statement has become an important avenue for many previously non-reporting entities. Technically Rule 144 provides a safe harbor from the definition of the term “underwriter” such that a selling shareholder may utilize the exemption contained in Section 4(1) of the Securities Act of 1933, as amended, to sell their restricted securities.

Securities attorney Kenneth Eade provides expert legal advice and ongoing corporate counsel to small public Companies as well as private Companies seeking to go public on the Over the Counter Bulletin Board Exchange (OTCBB). Mr. Eade  counsels private and small public Companies nationwide regarding reverse mergers, due diligence on public shells, corporate transactions and all aspects of securities law.