Securities laws govern stocks, mutual funds, and bonds to prevent fraud, insider trading, and market manipulation. The purpose of the Securities Exchange Act of 1934 was to protect investors from fraudulent activities by attacking the use of fraudulent and misleading sales practices while regulating the operation of stock exchanges and trading. Most states have also passed Blue Sky laws that further manage securities and require issuers to disclose more details for their offerings. These laws can be complex, with multitudes of rules regarding reporting and enforcement. While these rules do create transparency, they can be too difficult to understand without the help of an experienced securities attorney.
Securities can be either public or private offerings. An offering is public when it is offered directly to the public. These public offerings tend to be fronted by a bank acting as an underwriter and need a letter of agreement and a disclosure statement. Private offerings are sales of equity to a limited group of investors. These private offerings do not require SEC disclosure statements but do require disclosure privately to investors. Our securities team contains experts in private placement and other exempt offerings, SEC, and Blue Sky reporting and compliance.
At Kimball Anderson, we routinely represent issuers and investors in exempt offerings of equity and debt securities. We also assist corporate clients with transactional work. Our securities attorneys are experts in transactional and regulatory work that is involved with securities offerings. We often advise issuers of appropriate capital on the proper utilization of exemptions from federal and state registration requirements.