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Securities & Capital Markets

Overview

Michael Best’s Securities & Capital Markets lawyers have a wealth of experience advising issuers, underwriters, and investors in public offerings and private placements of equity and debt securities. We advise broker-dealers, investment advisers, and other securities professionals on meeting their compliance responsibilities in this highly regulated industry.

We counsel public companies in all securities law matters, such as reporting and compliance under the Securities Act of 1933, Securities Exchange Act of 1934, Sarbanes-Oxley Act, Dodd-Frank Act, and related SEC rules, as well as the listing standards of the NYSE, NASDAQ, and other stock markets.

We represent clients in many industries, including manufacturing, technology, banking, healthcare, life sciences, retail sales, and energy. We have strong professional relationships with investment companies, small business investment companies, investment advisers, insurance companies, bank holding companies, and trust companies. This diverse experience uniquely enables us to collaborate efficiently with other key deal participants, because we understand their perspectives and their businesses.

 

Public & Private Company Financings

We assist clients with a wide range of securities transactions, including initial public offerings (IPOs), Regulation A+, and other public offerings, as well as crowdfunding and private placements. Our experience encompasses equity and debt offerings for public and private companies, high-yield offerings, securitization, derivatives, fund formation, and more. Our attorneys help clients manage securities compliance and reporting, as outlined below, and have built relationships with issuers, underwriters, placement agents, broker-dealers, investment funds, exchanges, commodities/futures merchants, insurance companies, investment advisers, and other financial market participants.

Public Company Reporting & Compliance

We represent public companies in securities reporting and compliance matters involving the Securities Exchange Act of 1934, such as provisions added by the Sarbanes-Oxley Act and the Dodd-Frank Act; the rules and regulations of the NYSE, NASDAQ, and other securities exchanges and markets; and cross-border laws such as the Foreign Corrupt Practices Act (FCPA) and U.K. Bribery Act. Our services include preparing and filing Exchange Act registrations and periodic reports (10-Ks, 10-Qs, and other reports); proxy/information statements and annual reports to stockholders; reviewing earnings and other current event releases and investor materials; drafting responses to SEC staff comments and seeking “no-action” or interpretations; and structuring executive compensation packages and insider trading policies. We also provide general advice on disclosure obligations, stock exchange requirements, officer and director responsibilities (including reports of beneficial ownership); trading restrictions (short-swing profit recapture, short-sale prohibition, etc.); and anti-money laundering and anticorruption provisions.

Mergers & Acquisitions for Public Companies

Mergers and acquisitions involving public companies are more complicated than transactions involving only private companies. Our experienced team advises clients in all of the steps critical to a successful transaction. We have represented purchasers, sellers, and participants in merger-of-equals in public company transactions. We have also been engaged as special counsel to committees of independent directors in transactions with interested parties.

As public company transaction negotiations begin, a confidentiality discipline must be imposed and monitored for compliance. In order to mitigate potential liability to public stockholders trading the stock, public disclosures regarding the proposed transactions should be skillfully prepared. Definitive M&A agreements also require special drafting experience to deal with particular securities laws issued and, when finalized, must be filed publicly. Unlike private transactions, there is usually not post-closing indemnity, so the risk analysis process is significantly different.

Matters submitted to stockholders for consideration in connection with the transaction require that a proxy or information statement be prepared, filed preliminarily with the staff of the SEC, and circulated when SEC staff comments are cleared. If securities are to be issued as part of the acquisition, a registration statement covering the securities to be issued must also be filed with the SEC, comments cleared, and provided to the stockholders that will receive the securities. All of these steps must be coordinated with applicable stock exchange requirements, and the transaction closing must be arranged so that market trading is not interrupted.

Beyond securities law requirements, mergers and acquisitions also trigger special, complicated fiduciary duties for directors. Heightened fiduciary duties and conflicts of interest frequently require the implementation of special procedures. Engaging special advisers to counsel the board ensures the fairness of the transaction to all stockholders from a financial point of view, and in the terms and scope of any such engagement. Minority stockholders frequently file mid-transaction litigation in order to challenge the adequacy of the consideration to be received by stockholders, by asserting that directors have breached their fiduciary duties.

Broker-Dealer/FINRA Matters

We advise broker-dealer clients on formation and transfer, registration, licensing, and membership applications; transactional matters; and compliance with applicable federal, state, and self-regulatory organization laws and regulations. Our team includes a former general counsel for a brokerage and clearing firm, giving us a unique inside perspective. In the midst of ever-changing market conditions and evolving regulations, we provide proactive guidance on compliance and risk mitigation strategies, counseling broker-dealers on issues such as securities registration requirements, due diligence procedures, and anti-manipulation, anti-fraud, and anti-money laundering (AML) measures. We also represent clients in internal and government investigations, examinations, litigation, and enforcement actions before the SEC, the Financial Industry Regulatory Authority (FINRA), the Commodity Futures Trading Commission (CFTC), and state regulators.

Investment Adviser

Michael Best represents a wide range of advisory firms and dually registered investment adviser/broker-dealers, providing counsel on their operations and on various investment advisory products and services. We advise clients on compliance with federal and state regulations, as well as banking rules and regulations that apply to advisers affiliated or doing business with banks. Our work includes assisting with licensing and registration, preparing disclosure documents, reviewing marketing materials, conducting compliance audits and internal investigations, developing compliance and remediation programs, and responding to inquiries, examinations, and enforcement actions by regulatory agencies.

Securities Enforcement & Litigation

The SEC routinely identifies new areas of compliance emphasis that, over time, result in broad ranging enforcement efforts. Our Securities & Capital Markets Team works with our clients during routine examinations, taking a proactive approach to identifying the first signs of these enforcement trends. The team will review existing policies and procedures, and implement appropriate remedial measures in an effort to prevent more formal investigative or enforcement actions being brought against our clients. 

If matters proceed to formal investigations, we represent clients in on-the-record enforcement staff questioning, assist in document production, and work with enforcement staff to more fully understand their enforcement focus and advance our client’s position. If formal court or administrative proceedings are initiated, our experienced litigation team has the skill and background necessary to advance a vigorous defense.

Experience

We represent clients in corporate finance and securities matters such as:

  • Private placements of securities, including 144A debt offerings and other unregistered offerings (representing issuers, investors, and lenders)
  • Public offerings of securities, including IPOs, secondary offerings, and debt registration (representing issuers and underwriters)
  • Preparing companies for initial public offerings, including corporate restructuring, management incentive plans, composition of boards of directors, and other corporate governance issues
  • Structuring executive compensation packages
  • Preparing and reviewing Securities Act registration statements
  • Reviewing drafts of earnings releases and investor materials
  • Annual, quarterly, and current reports and proxy statements
  • Drafting no-action letter requests and other requests to SEC staff
  • Counseling management, boards of directors, and board committees on their fiduciary duties and obligations, in particular under Dodd-Frank
  • Advising on regulatory matters related to M&A transactions
  • Serving as borrower, underwriter, and bond counsel in bond and public finance
  • Representing mutual funds in the formation of new funds and ongoing SEC reporting and compliance
  • Registrations under the Investment Company Act of 1940 and the Investment Advisers Act
  • Structuring hedging arrangements for private investment funds, including “zero-cost collar” arrangements
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