The Securities and Exchange Commission (SEC) has proposed a suite of amendments to Regulation D, Form D and Rule 156 under the Securities Act of 1933 (Securities Act) (Proposed Rules). According to the SEC, the Proposing Release comes in connection with the adoption of amendments to permit general solicitation and general advertising in certain circumstances, as discussed in a recent OnPoint. A majority of the SEC Commissioners state that the Proposed Rules are intended to (i) enhance the SEC’s ability to monitor how the market will implement the new private offering regime and (ii) provide additional investor safeguards to combat concerns in connection with permitting issuers to engage in general solicitation and general advertising under the newly created paragraph (c) of Rule 506.
If adopted, the Proposed Rules would:
- Amend Rule 503 of Regulation D to require an issuer to: (i) file Form D no later than 15 calendar days in advance of the first use of general solicitation in a Rule 506(c) offering; and (ii) file a closing Form D amendment within 30 calendar days after the termination of a Rule 506 offering;
- Amend Form D to require additional information, primarily with respect to Rule 506 offerings;
- Amend Rule 507 of Regulation D to disqualify an issuer from relying on Rule 506 for one year in connection with future offerings if the issuer, or any predecessor or affiliate, did not comply within the last five years with Form D filing requirements as part of a Rule 506 offering..
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