SECURITIES LAW CLIENT ALERT: SEC Proposes to Eliminate the Prohibition Against General Solicitation and General Advertising in Rule 506 and Rule 144A Offerings

    View Authors 13 September 2012

    Overview

    On August 29, 2012, the Securities and Exchange Commission (SEC) proposed rules to eliminate the prohibition against general solicitation and general advertising for private offerings of securities that are conducted pursuant to Rule 506 of Regulation D of the Securities Act of 1933, as amended (Securities Act) and Rule 144A of the Securities Act provided the securities are sold to accredited investors in the case of a Rule 506 offering, and qualified institutional buyers (QIBs) in the case of a Rule 144A offering. The proposed amendments to Rule 506 and Rule 144A were mandated by Section 201 of the Jumpstart Our Business Startups Act (JOBS Act), which was signed into law on April 5, 2012.