I can't quite follow the laws yet (see SEC questio

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What is 'Schedule 13G'
Schedule 13G is an SEC form similar to the Schedule 13D used to report a party's ownership of stock that is over 5% of the company. Schedule 13G is shorter and requires less information from the filing party. Ownership of over 5% in a publicly traded stock is considered significant ownership, and therefore must be reported to the public. Given the 13G requires that the owner has no intent of exerting control, I don't know that partnered or business affiliated investors wouldn't have an intent to help sway proxy votes. 10% could be the needed vote to give

BREAKING DOWN 'Schedule 13G'
To be able to file 13G instead of 13D, the party must own between 5 and 20% in the company. It must also be clearly understood that the party acquiring the stake in the company is only a passive investor and does not intend to exert control. If these criteria are not met, and if the size in the stake exceeds 20%, a 13D must be filed.
Any investor with over a 20% stake must automatically file 13D, regardless of whether the intention to exert control exists. Additionally, institutional investors may be subject to stricter requirements than individual investors. Such requirements may include certification that the shares were acquired as part of normal business operations while also confirming the intent is not to exert control.

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Question 101.01

Question: A security holder owns over five percent of a class of an issuer's equity securities. The issuer's Form 10 registering this class of securities under Section 12(g) of the Exchange Act just became effective. If the security holder has not added any securities to its holdings since the effective date of the Form 10, may the security holder report its beneficial ownership on Schedule 13G pursuant to Rule 13d-1(d)?

Answer: Yes. The security holder is eligible to file a Schedule 13G pursuant to Rule 13d-1(d) since the security holder has not "acquired" any securities of a class registered under Section 12 of the Exchange Act. See Section 13(d), which requires an "acquisition" for the application of the reporting provisions. The security holder must file the Schedule 13G within 45 days after the end of calendar year in which the class of securities was registered. Note that the security holder is not required to certify that the shares were acquired or are held in the ordinary course or without the purpose or the effect of changing or influencing the control of the issuer of the securities.

If the security holder acquires additional equity securities after the effective date of the Form 10, the security holder must report its entire holdings on Schedule 13D or evaluate whether it is eligible to rely on Rules 13d-1(b) or 13d-1(c) to continue to report on Schedule 13G if the most recent acquisition, when added to all other acquisitions of securities of the same class during the 12 months immediately preceding the date of the most recent acquisition, aggregates to more than two percent of the class of such securities. See Section 13(d)(6)( of the Exchange Act. This 12 month period will run back from the date of the acquisition to the time when the issuer was privately held if the acquisition occurs within 12 months after the effective date of the Form 10. If the security holder has acquired two percent or less during this period, the security holder simply may continue to rely on Rule 13d-1(d) and reflect the present acquisition in its Schedule 13G pursuant to Rule 13d-2(b). [Sep. 14, 2009]

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Question 103.01

Question: If a security holder acquires more than 10 percent of a class of equity securities before the registration of that class under Section 12 of the Exchange Act, is it required to file a Schedule 13D when the issuer registers the class of securities under Section 12? If the security holder is not required to file a Schedule 13D, when must it file a Schedule 13G?

Answer: The security holder is not required to file a Schedule 13D upon registration of the class of securities under Section 12. See Section 13(d), which requires a filing of Schedule 13D only upon the "acquisition" of equity securities of a class registered under Section 12. However, the security holder must file a Schedule 13G pursuant to Rule 13d-1(d) within 45 days after the end of the calendar year in which the Exchange Act registration becomes effective. Note that the provisions of Rule 13d-1(b)(2), which require certain beneficial owners of greater than 10 percent of a class of equity securities registered under Section 12 to file a Schedule 13G within 10 days after the end of a designated month, are limited to the institutional investors listed in Rule 13d-1(b)(1), and do not apply to beneficial owners that file a Schedule 13G pursuant to Rule 13d-1(d). [Sep. 14, 2009]

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