MediaG3, Inc. (OTCMKTS: MDGC) A "shell" is a company that is already public but usually has no operating business at the present time. For example, a company might have had what seemed to be an exciting product at one time, perhaps even substantial sales, and affected a public offering to raise money for development and marketing of the product. For some reason the company terminated or reduced its business operations. However, the corporation of the company did not cease to exist, and the company still has shareholders and may be still quoted on an exchange, either the Pink sheets or the OTCBB. A shareholder base of a public company can be from 30 shareholders to thousands of shareholders. The "shell" may have no assets at all or have a substantial amount of cash or other assets. The "shell" may be a very old company or a brand new company.

Shells are usually sold for an amount of money and perhaps the principals retaining some stock in the new company after a merger. https://bit.ly/3lDovSt

Reverse Merger

A "Reverse Merger" is when a private company acquires the controlling interest in a public company, usually a "shell" company, and then effects a merger of the private company into the public company, with the public company being the surviving company.

Certain things usually happen and some SEC rules must be met upon the completion of the reverse merger. The name of the shell company is usually changed to the name of the private company. If the shell company has a trading symbol it is changed to reflect the name change. Many times, a reverse stock split will be done and additional shares issued to give the new principals more control of the Company. An information statement, called an 8-K, must be filed within 15 days of the closing. The 8-K describes the newly combined company, stock issued, information of new officers and directors, and financial statements audited to US GAAP, standards. The 8-K must disclose the same type of information that it would be required to provide in registering a class of securities under the Securities Exchange Act of 1934. https://bit.ly/3lDovSt

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