Pre-Filing Period

Gun Jumping

5( c)

Base prohibition on offers. Prohibits selling efforts (incl. publicity efforts, but not products advertising or periodic reporting) [Sec. Act. Rel. No. 3844] prior to filing a registration statement, via a prospectus or otherwise. Sensitivity to soft information (forward looking), versus hard information (past): i.e., naming an UW, distributing forecasts. Oral offers are not permitted here (contrast with the waiting period where, under 5(b)(1), they are.

2(a)(3)

Definition of an Offer. Includes any sale, attempt, or effort to sell (or, dispose of, or solicit offer to buy) a security or interest in a security for value. Default is that everything is an offer!

Rule 405

Treats all non-real time electronic communication offering securities as “graphic communication” - these are offers! Important for roadshows.

Rule 433

Hyperlinks are considered written offers.

2(a)(10)

Definition of Prospectus. Any written instrument (offer) is a prospectus. A confirmation is also a prospectus. What is a confirmation? Notice that a person has purchased shares, i.e. “Thanks for the money, here is your security.” A confirmation = an offer = a prospectus.

163A

Exemption from 5( c) requirements. Provides a safe harbor to issuers (not UW/Dealers) so long as communications are (1) made 30 days prior to the filing of the Registration Statement, (2) do not mention the offering, and (3) Issuers must take steps to prevent information from being further distributed during the 30 days prior to the Registration Statement being filed.

163

Exemption from 5(c ) requirements. Exempts WSKIs’ (not UW/Dealers) oral and written communications from 5(c) liability during the pre-filing period (pretty much treats these like FWP). Subject to having a legend [basically stating more is coming, the formal statutory prospectus, and how to get it] and meeting certain filing conditions [including filing the FWP communication upon the filing of their registration statement]. WKSIs don't have the same 30-day restriction.

2005 Offering Reform:` allows Automatic Shelf Registration Statements for WKSIs. Allows the WKSI to register an unlimited amount of securities for an unlimited period. WKSIs who file an automatic shelf registration statement skip directly to the post-effective period, allowing sales to commence among filing.

168

Fact + Forward. Exemption from 5(c) + (2)(a)(10). Provides a safe harbor allowing reporting issuers to regularly release factual business information and forward-looking information without those communications being treated as offers. Information must be of the kind and in the place as prior distribution, nothing novel. 

• Requires that information must have been disseminated previously to “customers and suppliers, other than in their capacities as investors or potential investors in the issuer’s securities.”

• Information relating to offering is ineligible. 

  • “Ordinary Course of Business” Safe Harbor: “to use Rule 168, the issuer must have ‘previously released or disseminated’ the same type of information in the ‘ordinary course of its business..’”

169

Fact. Exemption from 5(c) + 2(a)(10). Offers a similar safe harbor for non-reporting issuers to disseminate regularly released factual business information (but generally not forward-looking information, only hard information). 

• Issuer must have previously released or disseminated information of the same type in the ordinary course of business and in the same “timing, manner, and form.” 

BUT, 169(c): a communication containing information about the registered offering or released or disseminated as part of the offering activities in the registered offering is excluded from this exemption…

163B

QIBs + IAIs. Exemption from 5(c) + 5(b)(1). Permits all issuers to engage in “test-the-waters” oral or written communications with QIBs or institutional accredited investors (IAIs) (Reg D) before or after a registration statement is filed in order to gauge market interest in a contemplated registered securities offering.

• “To determine whether such investors might have an interest in a contemplated registered securities offering.”

• Communications under 163B are deemed offers under 2(a)(3), but are exempt from §5(c) (applicable in the Pre-Filing period) and §5(b)(1) (applicable in the Waiting and Post-Effective Periods).

Definition of a QIB + Institutionally Accredited Investor: (Rule 153B(b)(1), (2)): QIBs own and invest on a discretionary basis at least $100m of securities. Institutional Accredited investors have a minimum of $5m of total assets.

135

Tombstone. Exemption from Section 5. Provides a safe harbor for short, factual notices of a proposed registered offering. Only applies to the issuer, security holder selling the offering, and those working on behalf of issuer / securities holder. 

• Only basic, limited information is allowed: the name of the issuer, title/amount/terms of securities, anticipated timing, and, for business combinations, the purpose of the deal. U/W CANNOT be named. 

 2(a)(10)(b) is where we get the statutory authorization for this.