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Temperature Heats Up in PCAOB-China Talks
By David Feldman at 1 November, 2011, 11:12 am
The Reverse Merger Wire reports that Public Company Accounting Oversight Board (PCAOB) Chair James Doty is growing a little impatient with Chinese securities regulators over the issue of inspections of Chinese accounting firms that are auditing US public companies. There was an apparently positive meeting between the PCAOB and Chinese officials in July in Beijing. But [...]
Read More >>We’re a Lexis-Nexis Top 25 Blog!
By David Feldman at 28 October, 2011, 1:35 pm
Thanks to all of you, Lexis-Nexis has selected our humble blog as one of the top 25 corporate law blogs in the country! Now there is still a chance to vote for us to be one of, if not the top blog. You can easily register and vote through the instructions below. Thanks as always [...]
Read More >>Time to Modernize Rule 419: Part IV
By David Feldman at 25 October, 2011, 11:31 am
Can Rule 419 be updated so that reverse merger players will be attracted to utilize an investor-protective method? Yes I believe it can. Here is my suggested proposal: 1. Maintain the requirement to put money raised in a 419 IPO in escrow, minus underwriters compensation and 10% for expenses as currently. 2. Maintain the requirement [...]
Read More >>Time to Modernize Rule 419: Part III
By David Feldman at 25 October, 2011, 10:51 am
As mentioned above, as a practical matter shells could be inherited or created without the restrictions of Rule 419. But each has its limitations. Stock in Form 10 shells cannot trade until a registration is completed post-merger. “Legacy” shells face risk of undisclosed liabilities from the past and an unknown shareholder base. Shells masking as [...]
Read More >>Time to Modernize Rule 419: Part II
By David Feldman at 25 October, 2011, 10:04 am
Once Rule 419 passed, as mentioned above players tried but grew frustrated setting up shells and completing reverse mergers under the rule. So what happened? Three things. First, players discovered that a shell could be created from the carcass of a former operating public company that was sold or went out of business. Their stock [...]
Read More >>Time to Modernize Rule 419: Part I
By David Feldman at 25 October, 2011, 9:57 am
This is the first in a multi-part posting I intend to share with you developing a case for modernizing Rule 419 under the Securities Act of 1933. First I will outline the rule briefly, then talk about what happened after the rule was passed, then discuss why modernizing the rule makes sense given both market [...]
Read More >>SEC Gives More Comment Time on Nasdaq “Seasoning” Proposal
By David Feldman at 24 October, 2011, 12:10 pm
I was finally able to review the SEC’s release on September 12 which extended the time to comment on Nasdaq’s proposal to “season” reverse merger companies on the over-the-counter markets for six months before uplisting. It appears the SEC is seeking to harmonize the Nasdaq’s proposal with the similar proposals from the NYSE and NYSE [...]
Read More >>Tip of the Week: Make Sure You Should be Public
By David Feldman at 23 October, 2011, 5:24 pm
I often tell my clients, if you can benefit from being public, and can bear the risks of doing so, you should seriously consider it, regardless of your stage of development. However, in any well formulated decision, it is important to review the pros and cons. There are four well-recognized disadvantages to being public. First, [...]
Read More >>Tough Quarter for RM as SEC Roundtable Convenes
By David Feldman at 17 October, 2011, 10:08 am
I am aboard Amtrak’s fabulous Acela train on the way to participate in a panel at today’s SEC Roundtable on microcap securities in DC. Follow the webcast live starting at 1pm Eastern time at www.sec.gov. I hope to talk about reverse mergers today. About our three year effort to reverse the “evergreen” requirement to remain [...]
Read More >>Regulation A Reform Hits the Senate
By David Feldman at 13 October, 2011, 4:56 pm
Reform of SEC Regulation A has taken a big step forward in the US Congress. As regular blogees know, the House Financial Services Committee approved a bill to increase the amount which can be raised in the “mini public offerings” permitted by Regulation A, and exempt the offering from state merit review under certain circumstances. In [...]
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