SEC Proposes New Rules Under the JOBS Act

more+
less-

After missing several earlier deadlines, the Securities and Exchange Commission has proposed its first set of rules implementing the provisions of the Jumpstart Our Business Startups Act (JOBS Act). The proposed rules remove the long-standing prohibition against general solicitation and advertising with respect to certain securities offerings under Rule 506 of Regulation D of the Securities Act.

As we highlighted on this business law blog in recent weeks, New York and New Jersey startups looking to raise funds through the sale of securities must generally either register the securities offering with the SEC or rely on an exemption from securities registration.

As proposed by the SEC, the rules would permit companies to use general solicitation and general advertising to offer securities pursuant to a Rule 506 offering, provided that all purchasers of the securities are accredited investors and the issuer takes reasonable steps to verify that the purchasers of the securities are accredited investors, at the time of the sale of the securities.

LOADING PDF: If there are any problems, click here to download the file.

Published In: Business Organization Updates, Finance & Banking Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Kenneth Oh, Scarinci Hollenbeck, LLC | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »