5.6.4: Offerings Where State Law Not Pre-Empted (i.e., Not Rule 506 Offerings)

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Abstract

Uniform Securities Act The Uniform Securities Act,[1] first adopted by the National Conference of Commissioners on State Law in 1956, is the result of Professor Louis Loss's efforts to harmonize disparate state regulations; it has been passed (with myriad local variations) in more than 35 states.[2] The Act divides into four major parts: antifraud, registration of brokers/dealers, registration of offerings, and miscellaneous (i.e., definitions, penalties, administrative matters). In terms of exemptions for private placements, the most frequently used section is § 402(b)(9), which sets out the "limited offering" exemption, an exemption for not more than 10 offers in a state in a given 12-month period if the buyer takes for investment and no selling commissions are paid.[3] Certain institutional investors are disregarded in calculating the "10 offer" boundary.[4] Some form of this exemption is in effect in most states, but a number of issues must be resolved by...