1 Miss. Code. R. 14-7.03

Current through October 31, 2024
Rule 1-14-7.03 - Exemption from Registration for Certain Offerings by Domestic Issuers

By authority delegated to the Secretary of State in Section 75-71-203 of the Act, transactions pursuant to the following requirements are determined to be exempt from the registration requirements of the Act:

A. The sale of its securities by an issuer organized in this state to not more than thirty-five (35) persons within a twelve (12) month period beginning with the date of filing for exemption under this Rule, whether residents or nonresidents, provided that the issuer reasonably believes that the purchasers are acquiring the securities for investment purposes only and not for the purpose of resale. Purchasers of the issuer's securities which are registered pursuant to Section 75-71-303 or Section 75-71-304 of the Act shall not be considered in computing the number of purchasers during the twelve (12) month period.
B. Prior to the receipt of consideration or the delivery of a subscription agreement by an investor which results from an offer being made in reliance upon this exemption, the issuer shall file with the Division:
1. A notice on a form prescribed by the Division.
2. The prospectus, private placement memorandum, offering circular, or similar document, which shall contain a full disclosure of material information to be furnished by the issuer to offerees. The use of the Small Corporate Offering Registration Form (SCOR), a copy of which is available upon request, may be acceptable for compliance with this Subsection.
C. Securities issued under the provisions of this Rule shall be without payment of commission, compensation, or remuneration, directly or indirectly, except where it shall have been determined by the Division prior to the initial purchase under this exemption, that such commission, compensation, or remuneration is allowable.
D. Offerings or sales of securities pursuant to this Rule shall be made only by duly elected and acting officers of the issuers, or by the general partner of a limited partnership, or by a broker-dealer and his agents registered under the Act.
E. The following legend shall be printed in all capitals on the prospectus, private placement memorandum, offering circular, or similar document used in connection with an offering under this Rule:

"IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES AGENCY OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY GENERALLY NOT BE TRANSFERRED OR RESOLD FOR A PERIOD OF ONE (1) YEAR. INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME."

F. Neither the issuer nor any person acting on its behalf shall offer, offer to sell, offer for sale, or sell the securities by means of any form of general solicitation or general advertising, including, but not limited to, the following:
1. Any advertisement, article, notice, or other communication published in any newspaper, magazine, or similar medium or broadcast over television or radio;
2. Any seminar or meeting unless otherwise approved by the Division; or
3. Any letter, circular, notice, or other written communication unless the communication contains the information required by this Rule or unless otherwise ordered by the Division.
G. For the purposes of computing the number of investors under this Rule:
1. There shall be counted as one investor any corporation, partnership, association, joint stock company, trust, or unincorporated organization, unless such entity was organized for the specific purpose of acquiring the securities offered, in which case each beneficial owner of equity interests or equity securities in such entity shall count as a separate purchaser.
2. A purchase by a husband and wife in the joint names of both husband and wife shall be deemed to be made by a single investor.
3. The original limited partner who purchased an interest in the limited partnership primarily to enable the limited partnership to be formed and whose interest will be extinguished once the offering of the limited partnership interest has terminated shall not be considered to be a purchaser.
H. Securities exempt under the provisions of this Rule may not be transferred for one (1) year after the date of purchase except in a transaction which is exempt from registration or in a transaction which complies with the registration requirements of the Act.
I. The Division and every purchaser or offeree shall be notified within five (5) business days of any material change in the information submitted in accordance with this Rule.
J. No sales may be made until a written Acknowledgment of Notice Filing has been issued by the Division.
K. For offerings that exceed one (1) year, notification that the offering is continuing must be filed with the Division annually.
L. A notice of termination or completion of the transactions exempted under this Rule must be filed with the Division within thirty (30) days of termination or completion of the offering.

1 Miss. Code. R. 14-7.03

Miss. Code Ann. §§ 75-71-203, -605(a)(3) (2020).
Amended 6/3/2018
Amended 9/2/2019
Amended 4/18/2022
Amended 1/29/2024
Amended 3/14/2024