The waiting period is a crucial step in a company’s journey towards going public. After submitting their paperwork to the government, the company must wait for approval. During this time, the company’s ability to communicate with potential investors is restricted, but they can still provide some details about their business and the offering. This measure is in place to prevent the company from prematurely making commitments they may not be able to fulfil before receiving official approval.
The waiting period in the process of an initial public offering (IPO) is when the issuer waits for the Securities and Exchange Commission (SEC) to declare their registration statement effective. During this time, the issuer and underwriter assess market interest, while the SEC reviews the registration statement. This period is also known as gun jumping. While in the waiting period, the issuer is prohibited from making certain offers to sell their security. The issuer’s communications and activities during this time are governed by Section 5 of the Securities Act and SEC regulations. The issuer can make oral offers and conduct roadshows, but written offers must comply with Section 10, which regulates the information that a prospectus must contain. The issuer can communicate with potential investors through Rule 134, a preliminary prospectus, or a free writing prospectus. Rule 134 allows certain written communications that are not considered a prospectus, allowing the issuer to communicate using such written communications during the waiting period. A preliminary prospectus meets the requirements of Section 10 and must include all the information that a final prospectus would, except for the final offering price. A free writing prospectus that satisfies the requirements of Rule 433 is considered a prospectus under Section 10 and is an acceptable written offer. In an IPO, the issuer files their registration statement with the SEC, assesses market interest with the underwriter, and undergoes SEC review. During the waiting period, the issuer conducts a roadshow and makes oral offers to potential investors. The issuer also uses a preliminary prospectus to communicate with potential investors, which includes all the necessary information except for the final offering price. Additionally, the issuer utilises a free writing prospectus to communicate changes to their IPO, which meets the requirements of Rule 433 and is considered an acceptable written offer. This example demonstrates how an issuer can communicate with potential investors during the waiting period while adhering to the gun jumping restrictions outlined in Section 5 of the Securities Act and SEC regulations.
A waiting period refers to a specific period of time that must pass before a certain action or event can take place. In legal contexts, waiting periods are often imposed to allow parties involved to consider their decisions thoroughly or to comply with certain legal requirements.
Yes, waiting periods are quite common in various legal matters. They can be found in areas such as divorce proceedings, gun purchases, employment contracts, and insurance policies, among others.
Waiting periods in divorce cases are typically intended to provide couples with a cooling-off period before finalizing their decision to end their marriage. This allows them to reconsider their choice and potentially seek counseling or mediation to resolve their issues.
The length of the waiting period for a divorce varies depending on the jurisdiction. In some states, it can be as short as a few weeks, while in others, it may extend to several months.
Waiting periods for gun purchases are not universal and vary by state. Some states have no waiting period, while others may impose a waiting period of a few days to weeks.
Waiting periods for gun purchases are primarily intended to allow for background checks and to provide a cooling-off period to prevent impulsive acts of violence.
In certain circumstances, waiting periods can be waived or shortened. For example, if there is an immediate threat to someone’s safety, a court may grant an emergency order to bypass the waiting period.
Waiting periods in employment contracts are not mandatory for all positions or industries. They are typically used in situations where an employer wants to ensure the suitability of a candidate or to allow time for background checks and reference verifications.
The duration of waiting periods in employment contracts can vary widely. It can range from a few days to several weeks, depending on the specific requirements of the employer and the nature of the position.
Yes, waiting periods in insurance policies can impact coverage. For example, in health insurance, there may be a waiting period before certain pre-existing conditions are covered. It is essential to carefully review the terms and conditions of an insurance policy to understand any waiting periods that may apply.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.
- Page URL:https://dlssolicitors.com/define/waiting-period/
- Modern Language Association (MLA):Waiting Period. dlssolicitors.com. DLS Solicitors. May 09 2024 https://dlssolicitors.com/define/waiting-period/.
- Chicago Manual of Style (CMS):Waiting Period. dlssolicitors.com. DLS Solicitors. https://dlssolicitors.com/define/waiting-period/ (accessed: May 09 2024).
- American Psychological Association (APA):Waiting Period. dlssolicitors.com. Retrieved May 09 2024, from dlssolicitors.com website: https://dlssolicitors.com/define/waiting-period/
Our team of professionals are based in Alderley Edge, Cheshire. We offer clear, specialist legal advice in all matters relating to Family Law, Wills, Trusts, Probate, Lasting Power of Attorney and Court of Protection.
All author posts