Securities Lawyer's Deskbook                          published by The University of Cincinnati College of Law

Rule 904 -- Offshore Resales

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1. An offer or sale of securities by any person other than the issuer, a distributor, any of their respective affiliates (except any officer or director who is an affiliate solely by virtue of holding such position), or any person acting on behalf of any of the foregoing, shall be deemed to occur outside the United States within the meaning of Rule 901 if:
   
   
   1. The offer or sale are made in an offshore transaction;
      
      
   2. No directed selling efforts are made in the United States by the seller, an affiliate, or any person acting on their behalf; and
      
      
   3. The conditions of paragraph (b) of this section, if applicable, are satisfied.
      
      
2. Additional conditions.
   
   
   1. Resales by dealers and persons receiving selling concessions. In the case of an offer or sale of securities prior to the expiration of the distribution compliance period specified in Category 2 or 3 (paragraph (b)(2) or (b)(3)) of Rule 903, as applicable, by a dealer, as defined in Section 2(a)(12) of the Act, or a person receiving a selling concession, fee or other remuneration in respect of the securities offered or sold:
      
      
      1. Neither the seller nor any person acting on its behalf knows that the offeree or buyer of the securities is a U.S. person; and
         
         
      2. If the seller or any person acting on the seller's behalf knows that the purchaser is a dealer, as defined in Section 2(a)(12) of the Act, or is a person receiving a selling concession, fee or other remuneration in respect of the securities sold, the seller or a person acting on the seller's behalf sends to the purchaser a confirmation or other notice stating that the securities may be offered and sold during the distribution compliance period only in accordance with the provisions of this Regulation S (Rule 901 through Rule 905, and Preliminary Notes); pursuant to registration of the securities under the Act; or pursuant to an available exemption from the registration requirements of the Act.
         
         
   2. Resales by certain affiliates. In the case of an offer or sale of securities by an officer or director of the issuer or a distributor, who is an affiliate of the issuer or distributor solely by virtue of holding such position, no selling concession, fee or other remuneration is paid in connection with such offer or sale other than the usual and customary broker's commission that would be received by a person executing such transaction as agent.
      
      
      

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