Securities Law Resources

Final Rule: Nonpublic Offering Exemption, U.S. SECURITIES AND EXCHANGE COMMISSION, Release No. 33-4552
November 6, 1962, SECURITIES ACT OF 1933, Nonpublic Offering Exemptio

The Commission today announced the issuance of a statement regarding the availability of the exemption from the registration requirements of section 5 of the Securities Act of 1933 afforded by the second clause of section 4(1)1 of the Act for “transactions by an issuer not involving any public offering,” the so-called ” private offering exemption.” Traditionally, the second clause of section 4(1)1 has been regarded as providing an exemption from registration for bank loans, private placements of securities with institutions, and the promotion of a business venture by a few closely related persons. However, an increasing tendency to rely upon the exemption for offerings of speculative issues to unrelated and uninformed persons prompts this statement to point out the limitations on its availability.

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