Road Shows and SOR

1
Road Shows and SOR

• In Person and Electronic

2
What is a Road Show ?

• Historically an Oral Presentation
• By whom?
• Company management/lead underwriter
• To whom?
• Historicallyto broker-dealer prospective members
  of selling groupdue diligence
• Expanded to institutional investors/analysts and
  others

3
Electronic Road Shows

• Originally video tapes of in person road show
  sent to broker/dealers
• Telephone Conference Calls to Select Group
  listening to Presentation
• Internet and WebCast
• Video conferencing
• No-action letterslimited to traditional
  audiencesSOR replaces them

4
In Person Road Show

• Management and Underwriters make oral
  presentation-with or without Prelim Pros
• Do we need SOR after RS filed?
• Nonot a written communication not a
  prospectusdoes not violate 5(b)(1)
• If an IPO, should not hand out pink prosp.
• WhyS-K, Item 501(b)(3)-Instruction 1

5
In Person Road Show Q1-5

• Distribute Red Herring PRBefore SOR
• A 2(a)(10) prospectsviolates 5(b)(1)
• After SOROK provided what?
• Rule 433legend, filed, deliver Pre. Prosp
• Chalkboard-Powerpoint-Projector?
• All OK-Note to 433(d)(8)-- transmitted
  simultaneously with road show and are transmitted
  in a manner designed to make it available only as
  part of the road show
• Copies distributednot OK unless turn them into a
  free-writing prospectus and comply433

6
Overflow Room

• Videoconferencing teleconferencing-OK
• Is it a graphic communication405-yes
• Ordinarily would be written communication
• Last sentence-GC does not include
• if at the time of the communication, originates
  live, in real-time to a live audience does not
  originate in recorded form or otherwise as a GC,
  although it is transmitted through graphic means.
  

7
Electronic Road Shows

• DVD of In Person Road Show-IPO
• Send DVD to broker-dealers
• Is it a graphic communicationYes 405
• Is it a live-presentationNo-
• Hence, is a written communication
• Video Record In Person Road Show-IPO
• Made available on Internet Also a WC

8
ERSConsequencs?Q8

• DVD sent to dealers433?
• Have to file it
• Have to include legend
• Include preliminary prospectus
• Internet version available to everyone
• Have to include legend
• Preliminary prospectususe link (b)(2)(i)-Inst.
• Dont have to file itR. 433(d)(8)(ii)

9
Why the Difference?

• The Rule 433(d)(8)(ii) difference-- is required
  to be filed... unless the issuer of the
  securities makes at least one version of a bona
  fide electronic road show available without
  restriction by means of graphic communication to
  any person
• The recorded road show on the WEB was available
  to everyoneDVD was not
• See RetailRoadshow

10
RetailRoadshow Model

• Available to anyone who wants to access
• Is a bonafide versionsee next slide
• Still subject to other conditions
• Must include preliminary prospectus
• Can link to the prospectus as does RR
• Must include legendas does RR
• Preliminary Prospectus must include offering
  price range

11
Bona Fide Version

• Does it have to cover same areas as a live in
  person road show or live presentation to a live
  audience? No both oral Not an electronic road
• If make generally available one version and
  another that was recorded presentation to
  brokers only? Can generally available one omit
  info re company included in BD Version
• No-- both are written communications--R.433(h)(5)
  defines bona fide electronic road show as
  written communication that covers same areas as
  other road show written communications

12
Other Electronic Road shows

• Live presentation (via teleconferencing or over a
  website) at designated time access limited to
  broker-dealers institutional investors/an oral
  communicationno filing
• Follow-on offering --Records live presentation
  and makes it available on website (limited or
  unlimited access)
• Offering by reporting companyno filing

13
Assume did bothDVD Internet

• Now OK not to file-one bona fide version made
  generally available
• If Internet version omits CEOpresentation?
• Rule 433(h)(5)Not a bona fide version
• Internet version omits underwriters talk
• Rule 433(h)(5)-does it cover same general areas
  of informationre issuer etc.

14
Electronic Road ShowInternet WebcastQ10-13

• Q-10 Live Webcast IPO limited access
• Last sentence 405Graphic Communication
• Is Oralno filing, no legend, no PreProsp
• Q-11-Recorded limited access
• GC/WClegend, file, Prelim Prospectus
• Q-12-Recorded no limit on access
• GC/WClegend PreProsp no filing
• Q-13-Not bonafidemust file

15
Follow-on OfferingReporting Company (6 months)

• Q-10 Live Webcast limited access
• Last sentence 405Graphic Communication
• Is Oralno filing, no legend, no PreProsp
• Q-11/12-Recorded limited access-
• Rule 433(d)(8)(i)-(ii) differencenot required to
  be filed unless offering of common equity by
  non-reporting company
• Non-reporting company-nonconvertdebt?No
  filingnot offering of common equity

16
Radio or TV Broadcast of Road Show

• Is it a Section 2(a)(10) prospectus?
• Yes, expressly included in definition
• Does it make any difference if it is a GC?
• No, Adopt Releaseeven over Internet
• Does it make any difference if live?
• NoCan it be done under 433not if it is a
  roadshow of IPOdelivery of Pre. Pros.
• How distinguish from media Free-WP?

17
Some lessons learned

• Definition (405) of graphic communication
  establishes is a written communication
• However a live presentation to a live audience
  (not recorded) even if presented by graphic means
  (e.g. website) no GC
• Preserves its character as oral communicationnot
  a prospectus for 5(b)(2) purposes if not by
  radio/television

18
Some lessons learned

• A road show that is recorded and transmitted
  graphically (e.g. on website)
• is a written communicationalso a FWP
• Must meet conditionsregistration statement filed
  (includes offering price range if IPO)Delivery
  of preliminary prospectus if under (b)(2)/can do
  so by link

19
Some Lessons Learned

• If a road show FWP (433(h)) definition
  presentation regarding an offering by one or more
  members of issuer's management
• R. 433(d)(8)(i)no filing of road show FWP
• UNLESS (ii) offering by a non-reporting company
  of common equityNo filing required for debt or
  any security of rep. co.
• No filing of common if one bona fide version is
  made generally available