Interbrew

Going public involves the following procedures:

1. Management's first step in any issue of securities to the public is to obtain approval from the board of directors.

2. Next, the firm must prepare and file a registration statement with the SEC. This statement contains a great deal of financial information, including a financial history, details of the existing business, proposed financing, and plans for the future. It can easily run to 50 or more pages. The document is required for all public issues of securities with two principal exceptions:

a. Loans that mature within nine months.

b. Issues that involve less than $5.0 million.

The second exception is known as the small-issues exemption. Issues of less than $5.0 million are governed by Regulation A, for which only a brief offering statement--rather than the above registration statement--is needed. For Regulation A to be operative, no more than $1.5 million may be sold by insiders.

3. The SEC studies the registration statement during a waiting period. During this time, the firm may distribute copies of a preliminary prospectus. The preliminary prospectus is called a red herring because bold red letters are printed on the cover. A prospectus contains much of the information put into the registration statement, and it is given to potential investors by the firm. The company cannot sell the securities during the waiting period. However, oral offers can be made. A registration statement will become effective on the 20th day after its filing unless the SEC sends a letter of comment suggesting changes. After the changes are made, the 20-day waiting period starts anew.

4. The registration statement does not initially contain the price of the new issue. On the effective date of the registration