Solicitation Rule Changes – Part II

The most difficult type of accredited investor to verify is the natural person who meets the income or asset requirements. As discussed in a prior post, an accredited investor includes a person who has a net worth that exceeds $1,000,000.00 (without taking into account the value of a primary residence), or an individual who made $200,000.00 in the prior two years, or joint income with a spouse exceeding $300,000.00 in the prior two year, with a reasonably expectation of making […]

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Solicitation Rule Changes – Part I

As noted in a prior post, general solicitation of investors for private investment has historically been prohibited under SEC rules. This has meant that a party seeking investment could not solicit the public to find investors through such means as websites, radio or television ads, articles in trade publications or magazines, and so on. Accordingly, parties seeking investment have always had to maintain a careful watch over how they look for, and find, investors.

In 2012, Congress passed, and the President […]

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What is an Accredited Investor for Private Placements?

Accredited investors are specific institutions and individuals defined by the SEC rules who fall within the definitions at the time of the investment. Accredited investors include directors, executive officers and general partners of the issuer or an entity in which all of the equity owners are accredited investors. The definition also includes any individual who has a net worth of, including a spouse, that exceeds $1,000,000.00 but without taking into account the value of a primary residence, or an individual […]

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