JOBS Act – Title II, III and IV Explained
“Title II of the JOBS Act has reversed rules on general solicitation and advertisement of a Rule 506 offering, as long as all ultimate purchasers are accredited investors. Within 90 days following enactment of the law, the Securities and Exchange Commission must revise Rule 506 to provide that Rule 502’s limitations on solicitation and advertisement do not apply to Rule 506 transactions involving accredited investors only. This makes the identification of accredited investors especially significant. Prior to the JOBS Act, purchasers have been allowed to self-certify that they qualify as accredited investors. In a departure from this long-approved practice, however, the JOBS Act provides that issuers are now required to take “reasonable steps” to ensure investors purchasing securities through a Rule 506 offering are “accredited investors.” It remains unclear what steps the SEC will require from issuers to verify that purchasers under Rule 506 are actually accredited investors. According to the 14 Law Firm Consensus Report released on April 5, 2012, the current version of Rule 506 will remain in effect until the SEC puts forward the new rules.“
Read More at http://ppmlogix.com/blog. This article was written by Michael T. Rave, Ronald H. Janis, Frank E. Lawatsch, Jr., David Swerdloff, Lane Watson, Veronica M. Gonzalez and Edward Bion Piepmeier. Excerpt above from a newsletter mailing from PPMLogix, used by permission from Mr. Stapleton at PPM Logix.
There are some interesting items articles that are coming to my attention. This one, from a client (Frank Neukomm) has a flavor for start-ups:
Startups Look to the Crowd (Yahoo! Finance)
By JENNA WORTHAM | New York Times – Mon, Apr 30, 2012 12:25 PM EDT
But here is one that I really think is interesting – project funding for creative projects. Take a look at Kick Starter. My sister, Jenni Rebecca Stephenson who is the Managing Director of the newly merged Fresh Arts and SpaceTaker organization, says that:
“[The site] works best when it involves a product or takeaway. The biggest challenge of Kickstarter versus some of the others it that you don’t get ANY of the money unless you can raise ALL of your goal. That serves as motivation for some, but a barrier for others.“
Space Taker has been hosting workshops with other crowd funding entities for two years! Like Indiegogo. Two years, my sister is way ahead of her time, and obviously more hip and happening then me (just doing SEC related work outs and helping our clients get funding by transaction structuring) – that was a little tongue and cheek, but really, Space Taker is way ahead of other arts organizations…
And then OTC Markets kicks in with their own information hub at http://otcmarkets.web11.hubspot.com/jobs-act.
© 2012 by Rhodes Holdings LLC, except where noted and credited.