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SEC Proposes Rules Under JOBS Act Eliminating Prohibition Against General Solicitation and Advertising in Certain Reg. D/Rule 144A Offerings

September 06, 2012

By THE INVESTMENT MANAGEMENT PRACTICE

On August 29, 2012, the Securities and Exchange Commission proposed rules eliminating, under certain conditions, the prohibition against general solicitation and advertising in certain securities offerings made pursuant to Rule 506 of Regulation D and Rule 144A under the Securities Act of 1933. The proposed rules are mandated by the Jumpstart Our Business Startups Act (JOBS Act) that was signed into law on April 5, 2012. The JOBS Act’s relaxation of the general solicitation and advertising prohibition in Rule 506 and Rule 144A offerings are intended to make it easier for companies and private funds to raise capital from accredited investors and qualified institutional buyers by permitting such issuers to engage in broad based communication and solicitation efforts when seeking to raise capital.

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Image: Jacqueline A. May
Jacqueline A. May
Of Counsel, Corporate Department
Image: Michael R Rosella
Michael R Rosella
Partner, Corporate Department
Image: Arthur L Zwickel
Arthur L Zwickel
Partner, Corporate Department
Image: Michael L Zuppone
Michael L Zuppone
Partner, Corporate Department
Image: David A Hearth
David A Hearth
Partner, Corporate Department