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Full-Text Articles in Securities Law
The Up-C Revolution, Gregg D. Polsky, Adam H. Rosenzweig
The Up-C Revolution, Gregg D. Polsky, Adam H. Rosenzweig
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Over the past few years, a revolutionary new tax structure, known as the Up-C, has become increasingly popular, particularly in instances where an LLC is being taken public. In such an Up-C IPO, a newly formed C corporation is placed on top of the existing LLC, which continues to operate the business. Shares of the C corporation are sold to new investors, and the proceeds are used by the C corporation to buy an interest in the LLC. Meanwhile, the legacy owners of the LLC (typically, founders and private investment funds) retain their interests in the LLC, while receiving exchange …