How Do You Distribute Shares In A Public Corporation?
A corporation must go public before it can distribute shares and offer them as stock options to employees and contractors as a performance incentive. Additional offerings and filings allow a corporation to legally distribute company shares among interested buyers.. Here are steps to distributing shares. If a privately held corporation, get approval from your board of directors to go public. Find an underwriter willing to buy any shares not purchased by the general public or investment firms in your initial public offering (IPO). Select an investment bank to handle your transaction. Create a letter of intent that lays out the contractual obligations of both sides, as well as the fees the investment bank will charge. Your corporate attorney should review this document before it is signed. Work with your corporate attorney to create a prospectus. You may also want to retain a specialized securities lawyer during this process. The prospectus will summarize the corporation’s main function,
