In the United States, certain securities offerings that are exempt from registration under the Securities Act of 1933 may only be offered and sold to so-called “accredited investors.” The definition is a key component of several exemptions such as Rules
Do antifraud provisions apply to exempt offerings?
In the United States, antifraud provisions apply to all securities transactions, including exempt transactions. Companies are responsible for the statements they make when offering or selling securities and false or misleading statements are subject to liability under the antifraud provisions.
How will a company know if I am an accredited investor?
In Rule 506(c) offerings, companies are required to take reasonable steps to verify the accredited investor status of any purchasers in their offering. There is no per se way in which a company must take reasonable steps to verify such
What are restricted securities?
In the United States, “restricted securities” are securities that are subject to restrictions on transfer by their owner or holder. They are typically acquired in unregistered, private offerings either directly from the company issuing them or an affiliate of that
What is Rule 144 under the Securities Act of 1933?
Securities Act Rule 144 is a “safe harbor” that provides objective standards that a security owner can rely on for compliant aftermarket transactions pursuant to Securities Act Section 4(a)(1). Rule 144 provides for compliant resales of restricted securities if a