JOBS Act Implementation Regulations
It’s pretty common for issuers in follow-on offerings to solicit investors from previous rounds first. Indeed, doing so is often mandatory when early investors have preemptive rights. ...more
Most start-up businesses and real estate funds are in the same position as professional violinists–they don’t have sufficient capital to finance their business plans or real estate acquisitions. They may have access to some...more
Rule 506 is a non-exclusive safe harbor from the registration requirements of the Securities Act of 1933. If an offering meets the conditions of either Rule 506(b) or 506(c), it is deemed to not involve a public offering...more
What is Crowdfunding? Crowdfunding is a marketing tool that businesses use to obtain capital from a large number of individuals, typically over the Internet....more
The Jumpstart Our Business Startups Act (the “JOBS Act”) included a measure directing the Securities and Exchange Commission (the “SEC” or “Commission”) to relax the prohibition against general solicitation and general...more
The real estate development market continues to open up to crowdfunding, and the changes to capital raising for real estate projects could be significant if only a small portion of the potential of these new methods take...more
Since the Regulation A+ effective date last month, a number of websites have emerged that promote “Regulation A+ crowdfunding” contributing even further to the confusion in the market regarding “crowdfunding.” ...more
The availability of the private placement exemption under SEC Rule 506 depends in large measure upon determinations that purchasers are “accredited investors” under the rules. Where there is no general solicitation, Rule...more
On July 3, the Securities and Exchange Commission’s Division of Corporation Finance issued six new Compliance and Disclosure Interpretations (C&DIs) with respect to determination of accredited investor status and, in...more
The Director of the SEC’s Division of Corporation Finance, Keith Higgins, recently gave the keynote address, here, at the 2014 Angel Capital Association Summit. He focused on the following three items on the SEC rulemaking...more
The staff of the Securities and Exchange Commission’s Division of Corporation Finance published “Compliance and Disclosure Interpretations” (CDIs) on Wednesday, December 4, 2013, that provide important clarification regarding...more
Countless memoranda and alerts have been issued about the SEC’s adoption of rule amendments eliminating the prohibition against general solicitation and general advertising in Rule 506 and Rule 144A offerings. Congress...more
On July 10, 2013, the Securities and Exchange Commission ("SEC") issued proposed rules regarding amendments to Regulation D, Form D and Rule 156 of the Securities Act. The SEC has requested comments on the proposed rules....more
On July 10, 2013, the Securities and Exchange Commission (“SEC”) adopted rules to eliminate the prohibition against general solicitation and general advertising in certain securities offerings under Rule 506 of Regulation D...more
The SEC’s bad actor rules are causing a great deal of consternation amongst lawyers who are being asked to give opinions that the offer and sale of securities do not require registration under the Securities Act of 1933. ...more
The SEC has amended1 Rule 506 of Regulation D and Rule 144A under the Securities Act of 1933 (“Securities Act”) to (1) permit, in certain circumstances, an issuer to engage in general solicitation and general advertising in...more
Until recently, U.S. offerors and others had to make offerings of EB-5 project investments solely offshore in order to benefit from Regulation S, an exclusion from registration requirements. The offerors had to exclude...more
Effective September 23, 2013, pursuant to new SEC Rule 506(c), issuers of securities are allowed to reach “accredited investors” through general solicitation as long as they take adequate precautions to a) limit the offering...more
On August 19, Nicole Strydom and I gave a 10 minute presentation on the general solicitation rules and the current status of “crowdfunding” at a ceremony to announce the finalists in the student division of the Minnesota Cup....more
Issuers taking advantage of the general solicitation allowance provided by Rule 506(c) must take “reasonable steps” to verify the accredited investor status of investors in the offering....more
On July 10, 2013, the U.S. Securities & Exchange Commission (Commission) adopted rules eliminating the ban on general solicitation and advertising in certain private offerings, as required by Section 201(a)(1) of the...more
As forecast, there is no shortage of law firm memos describing Regulation D changes, including the final rules eliminating the general solicitation ban (here) and prohibiting "bad actor" participation (here) and the proposed...more
The Jumpstart Our Business Startups Act (JOBS Act) regulations, which were announced on July 10 and which become effective on September 23, promise a new era for capital raising for operating companies and private funds...more
The Securities and Exchange Commission (“SEC”) recently took action to implement certain provisions of the Jumpstart Our Business Startups Act (“JOBS Act”) and the Dodd-Frank Wall Street Reform and Consumer Protection Act...more
On July 10, 2013, the SEC substantially changed the rules for conducting unregistered offerings in reliance on Rule 506 of Regulation D by: - Lifting the ban on general solicitation and advertising in offerings where...more