(800) 341-2684

Call Toll Free

Contact us

Online Inquiries 24/7

Laura Anthony Esq

MAKE VALUED ALLIANCES

Reverse Mergers

Market Makers Rely on Due Diligence in Reverse Mergers

Following approval of the 15c2-11 application by FINRA, and the consistent quotation of a company’s securities, market makers may “piggy back” on the approved and completed 15c2-11. In short, a market maker may quote the share price of the Bulletin Board Shell while relying on the due diligence of other market makers and the company’s current SEC filings.

Although highly technical, the due diligence process can be completed quickly and thoroughly by an experienced securities attorney; the key is knowing where to look and what to look for. For example:

  • All articles and amendments are ordered from the company’s state of domicile and reviewed for procedural correctness and historical understanding.
  • DTC (the Depository Trust Company) is contacted to confirm the company is in a transferable status.
  • In addition to financial statement review, using several proprietary online search services, the firm conducts comprehensive debt and litigation searches to identify any miscellaneous debts as well as pending or past litigation.
  • A tax
Read More »

Reverse Mergers Hinge on Due Diligence and Cleaning Up Public Shells

When a publicly traded company “goes dark” and becomes delinquent in its filing requirements, it generally becomes a public shell and is no longer quoted on the Over the Counter Bulletin Board Exchange (OTCBB). However, with the assistance of an experienced securities attorney, the shell company can be restored so that a merger candidate can be introduced.

Some of the specific details that constitute the clean-up process include:

  • Reinstating the Company’s corporate charter and paying franchise taxes to the Company’s state of domicile, if necessary
  • Working with a PCOAB (Public Company Oversight Accounting Board) auditor to update all necessary financial statements and audits
  • Holding a shareholder meeting for purposes of electing directors and amending articles of incorporation and bylaws as necessary
  • Updating the Company’s articles of incorporation and bylaws to ensure they suit the needs of the successor Company
  • Conducting reverse splits of the Company’s outstanding shares of common stock in order to decrease the size of the outstanding common
Read More »

Categories

Contact Author

Laura Anthony Esq

Have a Question for Laura Anthony?