(407) 205-2330
Orlando - Central Florida

Orlando and Tampa Business Lawyer

Is your Orlando or Central Florida business considering acquiring some securities? Make sure you are in compliance with both Federal and State security laws! Call the Central Florida securities and business law attorney at J. Allen Law in Orlando for experienced legal counsel in all securities related matters.

Orlando and Central Florida Securities LawyerAn ownership interest in an entity, whether it's a limited partnership, limited liability company, or a corporation, could be considered a “security” falling within the ambit of federal and state regulation. Ascertaining the need to register these securities is commonly overlooked by inexperienced entrepreneurs, who often fail to realize that unless exempt, an initial issuance or a later transfer of their ownership interest (applicable to every sale and stock purchase) could be subject to both state and federal security laws. It is therefore important for an ownership issuance or an offering to be deemed outside the purview of the term “security,” or to fall within an applicable exemption, in order to avoid having to register with the Securities and Exchange Commission (“SEC”) or the relevant agency.

There is still a great deal of ambiguity as to the precise definition of a “security.” While the Securities Act of 1933 and Securities Exchange Act of 1934 attempt to provide a workable definition, the term remains largely a creature of case law. For instance, pursuant to The Securities Act of 1933, unless indicated otherwise by the “context,” a security can be “any note, stock, treasury stock, security future, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, . . . or, in general, any interest or instrument commonly known as a “'security.'” In SEC v. W.J. Howey Co., 328 U.S. 293, 66 S.Ct. 1100, 90 L.Ed. 1244 (1946), the United States Supreme Court, referring to an investment contract mentioned above, defined it as an investment of money in a “common enterprise” from which one can expect to derive “profits solely from the efforts of the promoter or a third party.” This articulation carries important implications. Furthermore, while many jurisdictions used what is known as the “investment/commerce dichotomy test” to define the term “security,” the Supreme Court of the United States has adopted a stringent standard of presumption in favor of a “security” that can be rebutted upon showing likeness to certain specified instruments. While there are many other factors surrounding the definition of “security,” an experienced corporate attorney should be able to quickly ascertain this matter to ensure regulatory compliance.

Ambiguities also exist with certain types of exemptions. One of the most commonly used exemptions, known as the intrastate offering, apply to buyers of stock so long as they are all able to claim principal residence or office in the company's state of incorporation at the time the offer is made and sold. Other exemptions involve consideration based on private placement offering or a qualified issuance of an employee incentive plan. Private placement offerings, which do not involve any public offering, are exempt from the Securities Act of 1933, but may still require the filing of notice with the SEC. See 15 U.S.C. §77d(a)(2). Additionally, while the provisions of Securities Exchange Act of 1934 generally do not apply to small companies its antifraud provisions are applicable to companies of any size.

Applicable corporations, limited liability companies and partnership interests must also abide with the Florida Securities and Investor Protection Act governed by Florida Statutes, Chapter 517. In addition to federal requirements, Fla. Stat. Chapter 517 embodies its own set of exemptions. A commonly used exemption by small startup businesses is the private placement exemption. To qualify for this exemption, the offering must satisfy specific set of requirements detailed within the statute.

Above are only some of the many factors to be considered when ascertaining need for compliance. The experienced attorneys at J. Allen Law P.L. can help you navigate this process and give you the peace of mind that you are being advised by competent legal counsel. Call us today for a free initial consultation.

Contact Our Orlando and Tampa Securities Attorney

If you are a business owner in Orlando, Tampa or anywhere in Central Florida and are interested in any kind of securities including a limited partnership, limited liability company, or a corporation, please contact our highly experienced Central Florida business and securities attorney for a free initial consultation. You can reach us at (407) 205-2330 or you may also fill out the online form located at the top of this page and we will contact you shortly. We value your privacy and will keep all your information confidential.


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390 N. Orange Ave, Suite 2300, Orlando FL 32801 * Main Phone: (407) 205-2330 * Direct Phone: (407) 205-2330 * Fax: (407) 442-0679

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