4.2.9.2. Safe Harbor for Private Placements Sold Directly from the Issuer
Many private placements are made directly by the issuer without use of a private placement agent, broker-dealer, or underwriter in connection with the offering. For these types of transactions, the SEC has laid out the activities the issuer’s employees may engage in without being considered a “broker” in the sale of the issuer’s securities. The issuer does not want to have to register its employees as broker-dealers. This safe harbor for its employees is sometimes called the “issuer exemption.”
The rule applies to “associated persons” of the issuer, which includes officers, directors, or employees of either the issuer or a company under common control with the issuer. An employee would not be considered a broker-d