The representations that the officers of a company make about its history, current status, and future are all very important. This is especially the case when thinking about the world from the perspective of a securities law attorney. If your corporation offers stock or takes in other types of investments, there's a good chance that you'll need to comply with a number of SEC regulations. Knowing a bit about these three areas of securities law will make it easier the next time you need to discuss a matter with a corporate lawyer.
A lot of the information regarding publicly traded companies and other firms that accept outside investments has the potential to be abused. This is particularly the case if one party has access to the information even a few minutes before another party does. There's a reason that stock profiles are littered with the dates of earnings announcements, meetings, votes, and distributions. A publicly traded enterprise has a responsibility to maintain a level playing field among the people who invest in it.
It Doesn't Have to be a Publicly Traded Company
While the SEC generally has lower reporting and compliance requirements for non-publicly traded firms, you should not assume that a private structure keeps you free and clear of regulations. For example, the SEC has taken a growing interest in the use of private equity in the last couple of decades, thanks in large part to the boom in early-stage investing in Silicon Valley.
Private securities are also a growing source of concern for the SEC. The Stiefel Labs case is a noted example, where a private firm and its CEO were charged with fraud for undervaluing buybacks. This was despite the non-public nature of the enterprise.
Dealing With Transitional Periods
One of the trickier times for an organization is when it is making a transition from one kind of corporate governance to another. Whether you're talking about doing an IPO or planning to take a business private, it's a good idea to have a corporate lawyer around to advise you about the pitfalls. There may literally be instances where what was legal for officers of a company to do on Monday may be illegal on Tuesday simply because that was the date the structure changed. With the help of a securities law attorney, you can get all stakeholders up to speed with such changes ahead of time.
For more information, check out a website like http://www.carterwestlaw.com today.Share