Robinhood amends S1 reflecting SEC review of converted shares
15:58, 1 September 2021
Robinhood Markets reported Wednesday it intends to file an acceleration request in relation to the previously reported sale of 97.8m shares resulting from a convertible note exchange, according to records filed with the US Securities and Exchange Commission.
Following completion of the SEC review of the share sale, the online broker intends to request the Resale S-1 effective two business days later.
The SEC review has held up the pre-IPO investors from selling the shares they received after the 5 August conversion of private-placement convertible notes by some of its large stakeholders.
SEC must complete review
“No sales can be made off the Resale S-1 until the SEC staff completes their review and declares it effective,” Robinhood said in an accompanying release. “At this time, we cannot predict how long that process will take.”
The SEC notified Robinhood of the review on 13 August.
Per the convertible notes covenant, the selling shareholders have the right to convert their notes to Class A shares at $26.60 per share. The convertible noteholders have previously reported plans to potentially sell their shares at $35.12, which at the time of SEC notification was the average share price of Robinhood shares through its first week of trading.
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Public announcement expected
“Once the SEC staff completes its review, Robinhood intends to file an acceleration request asking the SEC to declare the Resale S-1 effective two business days later,” Robinhood added.
Robinhood said it expects to make a public announcement when the acceleration request is officially made to the SEC.
After an initial spike to open the session, Robinhood shares are trading higher in mid-day trading, at $44.75, up from the $43.76 opening share price.