In a massive 585 page release, the Securities Exchange Commission on October 23 issued its long overdue proposed rules on equity crowdfunding to implement the statutory equity crowdfunding exemption set forth in Title III of the JOBS Act. As proposed, Regulation Crowdfunding implements and further clarifies the statutory requirements for equity crowdfunding, and in
The new SEC rules lifting the ban on general solicitation and general advertising in certain private offerings go into effect today, September 23, 2013. Beginning today, issuers in Rule 506 offerings may generally solicit investors and advertise their offerings provided they take reasonable measures to ensure that each purchaser is an accredited investor. The new
Sun Capital Partners was dealt a harsh blow by the United States Court of Appeals for the First Circuit in a recent decision where the court found that this private equity fund could be held liable for the pension withdrawal liability of its portfolio companies. The court essentially
espoused the view of the Pension Benefit
The SEC on July 10 finally lifted its 80-year old ban on general solicitation and general advertising in Rule 506 offerings, as Congress directed it to do last year in the JOBS Act. When the new rules go into effect in September, issuers will be able to use social media, the internet, blogs, email and
Last month, the SEC released its Final Report on the 2012 SEC Government-Business Forum on Small Business Capital Formation, the SEC’s annual forum to address perceived unnecessary impediments to small business capital formation. Participants typically include small business executives, VCs, government officials, trade association representatives, lawyers, accountants, academics and small business advocates. The Report contains
Of the countless details and decisions that the founder of a startup company is inevitably juggling as he launches his startup, one of the most important is making a timely Section 83(b) election. Under Section 83 of the Internal Revenue Code, an employee is not taxed on restricted stock received from an employer as
On July 3, 2012, Netflix CEO Reed Hastings kicked off the holiday weekend with some fireworks of his own by posting on his personal Facebook page that Netflix had streamed a billion hours of content in the month of June. Hastings designated the post as “public,” making it available to anyone on the Internet, including
In perhaps the only successful bipartisanship effort in 2012 to remove barriers to economic growth, Congress passed and the President signed on April 5, 2012 the most comprehensive set of laws to facilitate small company capital raising since the Federal securities laws were first enacted in the 1930s. In a nutshell, the JOBS Act (acronym for the Jumpstart Our Business Startups Act) creates an on-ramp for small company IPOs, removes the prohibition on general solicitation and advertising from the most commonly used private offering, creates a new equity crowdfunding exemption, sharply raises the cap for the small company offering exemption under Regulation A from $5 million to $50 million in any 12-month period and significantly raises the shareholder number trigger for Exchange Act registration. Some provisions are immediately effective, but others require SEC rulemaking.
Continue Reading Startups’ Guide to JOBS Act