Corporate Action Services

The principals of Coral Capital Advisors are experts in the corporate action process.  We have worked on dozens of corporate actions on behalf of our clients, and overseen  complex corporate restructurings.  Companies that have a class of shares traded on the Over the Counter (OTC) market, are required to obtain FINRA regulatory approval before a corporate action can be implemented.  Companies that have their shares listed on a major exchange are not required to obtain FINRA regulatory approval.  However, sometimes it pays to have an experienced team review the proposed action.  We bring a strong team of experts to your project to ensure its success and regulatory approval.

Corporate actions are events carried out by a company that have a material impact upon the shareholders. Examples of the types of corporate actions include:

  • Stock Splits:  Forward Splits which result in the number of shares being increased by a multiple of the existing number of shares; and reverse-splits which result in a reduction on the number of shares issued and outstanding.
  • Dividends:  Companies whose shares trade on the OTC Market are required to obtain FINRA regulatory approval in order to pay either a cash or stock dividend to their shareholders.
  • Mergers and Acquisitions:  Acquiring or combining with another business.
  • Rights Offerings:  The issuance of rights to acquire additional shares to the existing shareholders.
  • Spin Offs or Divestiture: The issuance of shares in a newly created independent business to the existing shareholders of the company; or in some cases, the existing operations to the existing management.
  • Name Changes:  Changing the name of the business.

In general, if it requires Board of Directors and/or shareholder approval, and impacts the shareholders, it is considered a corporate action.

The corporate action process can be complex.  It requires both proper planning and implementation.  For OTC traded companies, following the implementation of the corporate action, it will need to be submitted to FINRA for regulatory approval. It is important to remember, that as the primary regulatory authority of the Over the Counter market, FINRA views its self as having a responsibility to ensure that all corporate actions are carried out in a manner that complies with all appropriate federal and state requirements.  This be a very complex process that many companies find nearly impossible to navigate.

Our experience, allows us to advise and assist our clients with this complex regulatory process.

Please feel free to contact our offices to see how Coral Capital Advisors may be of assistance to you and your company.