Corporate and Securities Law

There are many securities law firms that assist in the going-public process, but OUR team of experienced attorneys ensure that ALL aspects of your corporate legal needs are satisfied as well. As the securities industry’s premier corporate and transactional law firm, we strive to maximize your time and money at all times while:

  • Taking Your Private Company Public
  • Drafting Form 10 and S-1 Registration Statements
  • Conducting Reverse Mergers and Forward Mergers
  • Structuring Registered Public Offerings
  • Maintaining Compliance with the Over-the-Counter Markets such as OTCBB, OTCQB and OTCQX
  • Maintaining Compliance with FINRA, the SEC and DTC
  • Drafting Operating Agreements and Private Placement Memorandums
  • Structuring and Completing Technical Commercial Transactions
  • Fulfilling the Reporting Requirements of the Securities & Exchange Commission (SEC)
  • Satisfying the Current Information Reporting Requirements of
  • Operating as Ongoing Corporate Counsel to; Small and Mid-Size Public Issuers, Private Companies Going Public, Officers, Directors and Shareholders of Publicly-Traded Companies

Our experienced team of SEC attorneys creates and institutes innovative strategic legal plans to solve unique management and ownership issues. They are problem solvers.  These highly motivated partners and associates not only understand the law, they understand that dynamics and demands of your particular business, regardless of sector. Effective legal representation can only be provided by a securities law firm that knows business operations from the ground up. While most corporate and securities law firms specialize in business theory, we focus on practical business applications.

Whether the client is a small to mid-size private or publicly-traded company, an entrepreneur with distinctive legal needs, or any corporate officer or director in need of broad-scope legal services, the attorneys of Legal & Compliance, LLC adapt to the particular matter at hand and deliver an exceptional work product in a timely fashion, each time, every time.

We are the most widely known “go-to” law firm of the OTC securities industry.

We Work to Avoid Problems, Not Just Solve Them

We are more than just corporate and securities attorneys focusing on small, publicly- traded companies. The firm provides comprehensive legal counsel for general corporate operations, business transactions, corporate law, corporate finance, regulatory, SEC and FINRA matters, and all aspects of going public. We perpetually maintain a realistic and pragmatic business perspective and emphasize avoiding the problems that can be foreseen and/or concisely resolving the ones that can’t.

Our experience in working with small to mid-size publicly traded companies is only exceeded by our ability to adapt. As the economic and regulatory landscape changes, we do as well. Our securities law firm is constantly evolving in order to stay abreast of regulatory changes and trends in the industry. The corporate finance landscape is perpetually changing and our securities attorneys adapt just as quickly. We provide our valued clientele with the most cutting edge corporate legal services at all times.

Corporate and Securities Law Practice Areas Include:

Compliance with the Reporting Requirements of the Securities Exchange Act of 1934, as amended, including:

  • Foreign Annual Reports on Form 20-F
  • Annual Reports on Form 10-K
  • Quarterly Reports on Form 10-Q
  • Current Reports on Form 8-K
  • Proxy Statements on Schedule 14A/Information Statements on Schedule 14C for annual shareholder meetings
  • Section 16 insider filings, including Forms 3, 4, and 5 for officers, directors, and major shareholders, and Schedules 13D and 13G for other significant shareholders
  • Registration Statements on Form 10

Representation related to transactions involving the Securities Act of 1933, as amended:

  • Registration Statements on Form S-1 for a Public Offering of Securities by a Domestic Company
  • Registration Statements on Form S-4 for a Merger
  • Registration Statements on Form S-8 for the Registration of Securities Under an Employee Benefit Plan
  • Registration Statements on Form 8-A to Become a Reporting Company in Conjunction with a Public Offering
  • Private Offerings Including Rules 506(b) and (c), 505, 504, Intrastate Offerings, 4(a)(2) Offerings
  • Section 3(a)(9) Exchanges
  • Crowdfunding
  • Section 3(a)(10) Transactions and Proceedings
  • PIPE Transactions
  • Equity Line and Credit Facilities
  • Form D for Private Offerings
  • Form 144 for a Sale of Securities
  • Registration Statements on Form F-1 for a Public Offering of Securities by a Foreign Company
  • Private Placement Offering Documents
  • Debt and Equity Corporate Finance Transactions

Other Focus Areas Include:

  • Reverse Mergers
  • Forward Mergers
  • Acquisitions
  • Asset Acquisitions
  • Joint Ventures
  • DTC Applications and Removals of Chills and Locks
  • Assistance with 15c2-11 Applications
  • Corporate Name Changes, Reverse and Forward Splits and Changes of Domicile
  • Employment and Independent Contractor Agreements, Stock Purchase Agreements, Investment Agreements, Licensing Agreements, Consulting Agreements, Distribution Agreements, Leases
  • Entity Formation and Constituent Documents Such as Operating Agreements, Shareholder Agreements, Partnership Agreements, Limited Partnership Agreements, Lock-up Agreements, Leak out Agreements

Your Going Public Transaction with Us

Initial Public Offerings (IPO’s) are on the rise once again. In an IPO, a company goes public directly by filing an S-1 registration statement for the public sale of its stock. That sale of stock can be by the company with an underwriter, which is known as an IPO. Alternatively, many issuers are choosing to self-underwrite their public offerings, commonly referred to as a Direct Public Offering (DPO). But of course, the process is highly regulated and without experienced legal counsel can be difficult, expensive and time-consuming.

Pursuant to Section 5 of the Securities Act of 1933, as amended (“Securities Act”), it is unlawful to “offer” or “sell” securities without a valid effective registration statement, unless an exemption is available. Companies desiring to offer and sell securities to the public must file with the SEC and provide prospective investors all material information concerning the company and the securities offered. The Securities Act sets forth in-depth rules on what constitutes material information, and on what forms and in what format that material information must be disclosed.

Rule 404(a) of the Securities Act sets forth the basic requirements for a registration statement. Rule 404(a) reads in part:

“A registration statement shall consist of the facing sheet of the applicable form; a prospectus containing the information called for by Part 1 of such form; the information, list of exhibits, undertakings and signatures required to be set forth in Part II of such form; financial statements and schedules; exhibits; any other information or documents filed as part of the registration statement; and all documents or information incorporated by reference in the foregoing.”

Over the years the SEC has created and eliminated various registration forms. Currently all domestic issuers must use either form S-1 or S-3. Form S-3 is limited to larger filers with a minimum of $75 million in annual revenues, among other requirements. All other issuers must use form S-1.

There are four primary regulations governing the preparation and filing of Form S-1:

(i) Regulation C – contains the general requirements for preparing and filing the Form S-1. Included within Regulation C are regulations and procedures related to (a) the treatment of confidential information; (b) amending a registration statement prior to effectiveness; (c) procedures to file a post-effective amendment; and (d) the “Plain English” rule

(ii) Regulation S-T – requires that all registration statements, exhibits and documents be electronically filed through the SEC’s EDGAR system and must include interactive data using the XBRL process.

(iv) Regulation S-K – sets forth, in detail, all the disclosure requirements for all the sections of the S-1. Regulation S-K is the who, what, where, when and how requirements to complete the S-1.

(v) Regulation S-X – sets forth the requirements with respect to the form and content of financial statements to be filed with the SEC. Regulation S-X includes general rules applicable to the preparation of all financial statements and specific rules pertaining to particular industries and types of businesses.

Both the Securities Act of 1933, as amended (“Securities Act”) and the Securities Exchange Act of 1934, as amended (“Exchange Act”) provide remedies to investors in the IPO and DPO process. The basic premise of such liability is that either an investor was not given an opportunity to review investment disclosure documents prior to making the investment, or such disclosure documents contained inaccurate information or failed to contain material information. The bottom line is that if an officer or director signs a registration statement which is filed with the SEC and which contains misstatements or fails to contain material information, they may be subject to liability on two fronts – from the SEC in an enforcement proceeding, and from individuals and entities in a private civil claim.

Private Placement Followed by Registration of Securities

A public company, by definition, has public shareholders. Reverse mergers, IPO’s and DPO’s all result in a public shareholder base. Another option for a company going public directly is to complete a private placement; selling shares to unaffiliated third parties and then filing an S-1 resale registration statement as to those shares. Each of these options results in an unaffiliated public shareholder base. Simply stated, all of these aforementioned processes result in a company going public.

The S-1 resale registration statement filed on behalf of selling shareholders is the same, and contains the same required information as an S-1 registration statement filed on behalf of the company itself.

The main benefit to a private company going public through the filing of an S-1 Registration Statement as opposed to a reverse merger is that the company does not have to be concerned about undisclosed, potential or contingent liabilities.  Moreover, the SEC rules relating to shell companies (such as Rule 144 and Rule 145) prevent the operating company’s shareholders from selling stock using the Rule 144 exemption for twelve months following the completion of the merger. Finally, if not completed correctly, the newly merged entity may face trading difficulties with either or both FINRA and DTC.


Following the effectiveness of the S-1 registration statement, the company will need to engage the services of a market maker to file a 15c2-11 application with FINRA to obtain permission to quote and trade the stock and to receive a trading symbol. FINRA is the self-regulatory body which overseas trading on the over-the-counter market. On the most basic level, FINRA issues trading symbols to company’s trading on the over-the-counter market (including the Pink Sheets, OTCQB and OTCQX and OTCBB).

The Depository Trust Company (DTC) provides the clearing and settlement services for all the electronic trading of securities in the United States. Over the past year, DTC eligibility has become a concern for many OTC issuers. The DTC has become active in reviewing the securities of issuers and requiring that an issuer be able to prove, to the DTC’s satisfaction, that all shares trading electronically are indeed legally entitled to do so. This includes shares that may have been issued in a predecessor company many years before and for which records are not available.

Obtaining and maintaining eligibility is of the utmost importance for the smooth trading of an issuer’s float in the secondary market. Moreover, DTC eligibility is a prerequisite for OTC issuers’ shareholders to deposit securities with their brokers and have such securities be placed in street name.

Legal & Compliance stays current with all DTC issuer requirements to assist clients to avoid unnecessary disruptions to their stocks trading activity and to remove DTC chills and locks whenever possible.

Going Public Via Reverse Merger

A reverse merger transaction is one in which a private operating entity merges with a public shell company, resulting in the private operating company becoming public. Generally the shareholders of the private operating company will exchange their ownership in the private company for a majority stake in the public shell company. A “shell company” is an entity that has no or nominal operations and no assets or assets consisting solely of cash and cash equivalents. A reverse merger is an alternative method of going public (as opposed to an IPO, DPO or private placement followed by the registration process).

A reverse merger is often structured as a reverse triangular merger. In that case, the public shell forms a new subsidiary which new subsidiary merges with the private operating business. At the closing, the private company shareholders still exchange their ownership for shares in the public company and the private operating business becomes a wholly owned subsidiary of the public company. The primary benefit of the reverse triangular merger is the ease of shareholder consents. That is because the sole shareholder of the acquiring entity is the public company. The directors of the public company can approve the transaction on behalf of the acquiring subsidiary, avoiding the necessity of meeting the proxy requirements of the Securities Exchange Act of 1934.

The advantages of a reverse merger revolve around time. A reverse merger transaction can be completed very quickly and efficiently. The disadvantages of a reverse merger generally revolve around undisclosed prior issues or liabilities with the public shell, including issues that could affect DTC eligibility. This primary disadvantage can be addressed by hiring competent securities counsel to assist with the due diligence process. Another disadvantage involves cost; a reverse merger transaction, although substantially quicker than an IPO, can cost substantially more. In addition to legal and accounting fees, a private entity must purchase the public shell itself.

Like any transaction involving the sale of securities, the issuance of securities to the private company shareholders must either be registered under Section 5 of the Securities Act or by subject to an available exemption from registration. Generally, shell companies rely on Section 4(2) or Rule 506 of Regulation D under the Securities Act for such exemption.

Ongoing Corporate Counsel and Public Company Compliance

Please see our page entitled “Over-the-Counter Market Compliance” to understand how the corporate and securities attorneys of Legal & Compliance, LLC can provide comprehensive, ongoing legal counsel to your public company or assist you with your complex corporate transactions.

Our legal team is diverse, experienced, highly motivated and currently prepared to begin working with you today.

Inquiries of a technical nature are always encouraged. Contact us now.