Advantages of Regulation S

Regulation S is a safe harbor that occurs when a security offering is deemed to come to rest abroad so as not to be subject to registration imposed under Section 5 of the Securities Act. Section 5 includes offers and sales within the United States and do not include those that occur outside the country. Regulation S includes several safe harbor exemptions for specified transactions.

Each safe harbor is subject to two general conditions:

1. The offer or sale must occur in an “offshore transaction" and the seller must have reason to believe that the buyer is offshore at the time of the offer or sale, or the transaction must occur on certain “designated offshore securities markets" while the transaction is not pre-arranged with a buyer in the United States.

2. No directed selling efforts may be made in the U.S. by the issuer, a distributor, or any of their respective affiliates, including efforts reasonably expected to condition the U.S. market for the securities.

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