IMPORTANT INFORMATION ABOUT
U.S. REGULATORY HOLDER COUNT LIMITS

U.S. regulations limit the number of U.S. holders for certain types of securities.

If a Security is at its limit for U.S. holders, U.S. Users will only be able to bid if they are already holders of the security. Bids will not be accepted from U.S. Users not currently holders of the security until the holder count is below its limit.

Any open bid orders by U.S. Users not currently holders of the security will be cancelled when a security reaches its U.S. holder limit.

EXAMPLES BELOW:

For a security below its U.S. holder limit:

  1. Eligible U.S. User holders of the security may enter bids or offers
  2. Eligible U.S. Users not holding the security may enter bids only
  3. Non-U.S. Users holders of the security may enter bids or offers
  4. Non-U.S. Users not holding the security may enter bids only

For a security at its U.S. holder limit:

  1. Eligible U.S. User holders of the security may enter bids or offers
  2. Eligible U.S. Users not holding the security may not enter bids until the security holder count is below its limit

    EXAMPLE:

    • XYZ is a “3(c)(1) Fund” limited to 99 U.S. holders to maintain its exempt transaction status
    • XYZ has 99 current U.S. holders
    • U.S. Users not already holding the security may not enter bids until the security holder count is below its limit.
    • The following order is entered:User 1 (U.S. user, current holdings of 500 XYZ) enters sell of 500 XYZ @$1.00
    • Until XYZ’s U.S. holder count is below its limit, only existing U.S. holders or non-U.S. Users may buy from this offer.
  3. Non-U.S. Users holders of the security may enter bids or offers
  4. Non-U.S. Users not holding the security may enter bids only

For a security reaching its U.S. holder limit:

  1. Eligible U.S. User holders of the security may enter bids or offers and previously open orders remain active
  2. Eligible U.S. Users not holding the security may not enter bids until the security holder count is below its limit and open bids are cancelled (see example below)

    EXAMPLE:

    • XYZ is a “3(c)(1) Fund” limited to 99 U.S. holders to maintain its exempt transaction status
    • XYZ has 98 current U.S. holders
    • The following are the best/highest buy orders (displayed in order book priority) open in XYZ:
      • User 1 (U.S. user, no current XYZ holdings) $1.00 bid for 50 XYZ
      • User 2 (U.S. user, no current XYZ holdings) $1.00 bid for 100 XYZ
      • User 3 (U.S. user, no current XYZ holdings) $1.00 bid for 10 XYZ
    • The following order is entered: User 4 (U.S. user, current holdings of 500 XYZ) enters sell of 500 XYZ @$1.00
    • The following is the result:
      • User 4 sells 50 XYZ to User 1 @$1.00
      • User 4 still owns 450 XYZ
      • XYZ now has reached its limit of 99 U.S. holders & no new U.S. holders can be added until XYZ’s U.S. holder count is below its limit
      • Open bids are cancelled for Users’ 2 and 3, as are all other buy orders for U.S. Users not already holding XYZ.
      • User 4’s remaining offer of 450 @$1.00 is displayed as an open offer – until XYZ’s U.S. holder count is below its limit, only existing U.S. holders or non-U.S. Users may buy from this offer.
  3. Non-U.S. Users holders of the security may enter bids or offers and previously open orders remain active
  4. Non-U.S. Users not holding the security may enter bids only and previously open orders remain active

Additional information can be found at the following links to certain SEC rules & guidance

Below please find certain U.S. Securities and Exchange Commission (“SEC”) rules and guidance on a few topics that may influence investors’ ability to buy or sell certain securities in accordance with U.S. securities laws, among other things.

THE FOLLOWING LINKS ARE NOT LEGAL ADVICE AND USERS ARE ENCOURAGED TO CONSULT THEIR OWN, ATTORNEY, ACCOUNTANT, TAX ADVISER AND/OR INVESTMENT ADVISER AS TO THE FINANCIAL, TAX, LEGAL, ACCOUNTING, REGULATORY AND RELATED MATTERS THAT MAY RESULT FROM THE PURCHASE OR SALE OF SECURITIES ON CFX MARKETS. CFX MAKES NO REPRESENTATIONS TO THE ACCURACY OF THE INFORMATION CONTAINED IN ANY OF THE LINKS AND IS UNDER NO OBLIGATION TO UPDATE THE LINKS CONTAINED HEREIN.

Selected SEC Materials

SEC Rule 144

SEC Rule 144A - Private resales of securities to institutions (17 CFR § 230.144A)

SEC Revisions to Rule 144 and 145

SEC Fast Answers – Securities Act Rule 144

SEC Investor Alert – Rule 144

SEC Investor Publications - Rule 144: Selling Restricted and Control Securities

SEC Regulation D

SEC Regulation D Guidance
Related Resources:

SEC Guidance for Issuers under Rule 504 of Regulation D

SEC Filing and Amending a Form D Notice

SEC Disqualification of Felons and Other "Bad Actors" from Rule 506 Offerings and Related Disclosure Requirements

SEC Guidance on Shareholder Registration Requirements
Related Resources:

SEC Accredited Investor Status

SEC Accredited Investor Net Worth Standard

Regulation S—Rules Governing Offers and Sales Made Outside the United States Without Registration Under the Securities Act of 1933

Beneficial Ownership Limit for “3(c)(1)” Funds