On June 7, 2012, the Securities and Exchange Commission (the “SEC”) approved a revised version of Financial Industry Regulatory Authority (“FINRA”) Rule 5123 (“Rule 5123”) on an accelerated basis. The new rule will marginally increase the reporting burdens on FINRA member firms that sell certain private placements to certain classes of accredited investors. The effective date for Rule 5123 has not yet been determined.Under revised Rule 5123, FINRA member firms that sell a security in a nonpublic offering are required to: (1) submit to FINRA a copy of any existing offering document, including Private Placement Memoranda, term sheets, or other offering documents, used in connection with a private placement within 15 calendar days of the date of the first sale, in addition to any material amendments to documents that were previously-filed; or (2) indicate to FINRA that no such offering documents were used in connection with such sale. FINRA will use the information gathered from Rule 5123 filings to aid in the detection and prevention of fraud and to assist with the identification of problematic terms and conditions found in private placement offering documents. All documents filed pursuant to Rule 5123 will receive confidential treatment and will only be used for the purpose of determining compliance with FINRA rules and other relevant regulatory purposes. Various exemptions from the Rule 5123 filing requirements are available depending on the type of offering and the type of purchasers that are involved. We encourage all FINRA member firms to carefully review the requirements and exemptions contained in the SEC order granting accelerated approval of FINRA Rule 5123 (the “Rule 5123 Order”). The Rule 5123 Order is available by clicking here.
While we are pleased to have you contact us by telephone, surface mail, electronic mail, or by facsimile transmission, contacting Kilpatrick Townsend & Stockton LLP or any of its attorneys does not create an attorney-client relationship. The formation of an attorney-client relationship requires consideration of multiple factors, including possible conflicts of interest. An attorney-client relationship is formed only when both you and the Firm have agreed to proceed with a defined engagement.
DO NOT CONVEY TO US ANY INFORMATION YOU REGARD AS CONFIDENTIAL UNTIL A FORMAL CLIENT-ATTORNEY RELATIONSHIP HAS BEEN ESTABLISHED.
If you do convey information, you recognize that we may review and disclose the information, and you agree that even if you regard the information as highly confidential and even if it is transmitted in a good faith effort to retain us, such a review does not preclude us from representing another client directly adverse to you, even in a matter where that information could be used against you.