Securities Lawyer 101 l Brenda Hamilton

Securities Lawyer 101 l Brenda Hamilton

Friday, January 17, 2014

The JOBS Act For Foreign Issuers

The JOBS Act offers incentives for foreign issuers seeking to go public and enter the U.S. capital markets without filing a Form S-1 or other registration statement under the Securities Act of 1933, as amended or registering a class of securities on Form 10 under the Exchange Act. Effective September 23, 2013, as required by the JOBS Act, the SEC lifted the ban on general solicitation and advertising in private placement offerings of securities made pursuant to Rule 506(c) of Regulation D.
The JOBS Act’s new Rule 506(c) allows issuers to use general solicitation and advertising to offer and sell securities under Rule 506, provided that (i) all purchasers of the securities are made to accredited investors and (ii) the issuer takes “reasonable steps” to verify that the purchasers are accredited investors.

Rule 506(c) makes is easier and quicker for foreign issuers to enter the U.S. securities markets.  The new rule expands the pool of investors and enables issuers to obtain the shareholders required by the Financial Industry Regulatory Authority to obtain a stock ticker symbol.  Foreign issuers are able to advertise their securities offering without filing a registration statement with the SEC, if desired. Alternatively issuers can register the resale of the shares sold in the in their private placement offering on Form F-1 or S-1.  Rule 506(c) provides increased opportunities to foreign issuers and enables them to place private placement memorandums and advertisements on their websites and other media.
The JOBS Act also lifted the thresholds for mandatory registration under Section 12(g) of the Securities Act to issuers with either (i) 2,000 or more persons or (ii) 500 or more persons who are not accredited investors.   In calculating the number of holders of record, companies may now exclude persons who received securities pursuant to employee compensation plans in transactions exempted from registration under the Securities Act.
For further information about this blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202, Boca Raton, Florida, (561) 416-8956, or visit
This blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. For more information concerning the JOBS Act, crowdfunding, emerging growth companies, Rule 144, Form 8K, FINRA Rule 6490, Rule 506 private placement offerings, Regulation A, Rule 504 offerings, SEC reporting requirements, SEC registration on Form S-1 and Form 10, Pink Sheet listing, OTCBB and OTCMarkets disclosure requirements, DTC Chills, Global Locks, reverse mergers, public shells, go public direct transactions and direct public offerings please contact Hamilton & Associates at (561) 416-8956 or by email at Please note that the prior results discussed herein do not guarantee similar outcomes.
Hamilton & Associates | Securities Lawyers
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 North
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855

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