Can a Securities Act Section 4(1) Opinion Remove a Restrictive Legend Despite the Rule 144 Evergreen Requirement? 2

The seminal Securities Act of 1933 provides that in order for shares of stock to become tradable, a registration process with the SEC must be undertaken. There are several exemptions to the requirement to register, including Section 4(1) of the Securities Act, which very simply provides that the requirements of registration do not apply to ...

Off We Go

For just a moment, never mind 144(i), evergreen requirements, SPAC doldrums, Worm/Wulff yada yada yada. Sunday is the big day. We are taking my daughter to begin her freshman year at a prestigious university in the Northeast, less than four hours from our home. I think I am ready. I know she is ready though ...

SEC Response to my Request for Interpretive Guidance

I received a telephonic response to my request for interpretive guidance on Rule 144(i). See prior blog entries for the request itself. The bad part of the response: the Staff believes that 144(i) is retroactive to issuers who stopped being shells before the effectiveness of the rule. Thus, every company that was ever a shell, ...

Tip of the Week: Beware the IPO Myth

Myth: Strong market support for a stock always follows a traditional IPO. You have probably heard this line a million times; however, nothing can be further from the truth. The basics of an IPO work like this. A company hires an investment banking firm to serve as lead underwriter of the stock offering. A prospectus ...

Heard Better Medleys Than This

A new US Court of Appeals case known as SEC vs. M&A West, Inc. et al provides important reminders about how not to structure reverse mergers and compensate intermediaries. Thanks to our friend Sam Krieger, who sent a note out to his blast list about the case. OK here we go, haven’t had to brief ...

Solid Second Quarter for RM

The Reverse Merger Report is a great source of data and industry information, and I urge you all to subscribe at www.dealflowmedia.com. Their second quarter review has many of us feeling good about RM, despite a few roadblocks making some deals a bit harder in this market and regulatory environment. Second quarter deal flow was ...

Fifth WRASP Completed

Rick Rappaport and his team at WestPark Capital in LA have completed the fifth reverse merger and PIPE using his “WRASP” structure. As mentioned in previous entries, after a traditional merger and PIPE, Rick takes the company directly to the American Stock Exchange through a secondary public offering immediately thereafter. I very much like this ...

Another Record – In Summer Yet!

Last Thursday, July 31, we hit another one day record for the number of visits to this humble blog. Thanks to everyone! Considering many people are on vacation during the summer, I think that’s an especially cool accomplishment. I will continue to work to earn your repeat visits and interest in these increasingly popular, legitimate ...