Directed Share Program (“Friends and Family”)

A directed share program is a plan designed to allow company employees, their relatives, and other parties with a relationship to the company to purchase stock as part of a public offering. The directed share program sets aside a quantity of stock shares that qualified parties may purchase at the public offering price.

William Blair & Company can administer a directed share program as a service to the issuer. It is typical for the underwriter to reserve from three to five percent of an offering. The program is a valuable tool for issuers, who use it to involve directors, officers, employees, suppliers, and other business partners in the public offering process in the hope of giving them a stake in the issuer's future success.