Lawyers & Professionals

Firm Overview

Instead of trying to be everything to everybody, we’ve made a name for ourselves by delivering what our clients need most: in-depth, hands-on legal counsel throughout the financial services sector — and beyond.

Get to know us

Firm News

There’s a lot going on at Schulte — we’re wrapping up high-profile matters, welcoming talented new lawyers, speaking on issues that affect our clients, and more.

Read all about it

Pro Bono

Throughout our history, Schulte has provided comprehensive pro bono services to local and national nonprofit organizations. Today, we serve more than 50 nonprofits and work to advance a variety of social justice causes.

Learn more

Diversity, Equity and Inclusion

Inside the firm, we work hard to attract diverse, talented lawyers and encourage their career growth and advancement. And outside the office, we’re active in volunteer drives and local initiatives that support underrepresented groups.

See what we’re up to

Alumni

If you’re a current or former Schulte lawyer, join our Alumni Network on LinkedIn to stay connected with old friends, make new contacts, and share your successes, ideas and insights.

Stay in touch

Social Responsibility

We take doing “good work” seriously — whether we’re talking about our high ethical standards or the way in which we foster a positive and inclusive culture for our personnel and support local communities.

See how we work

Offices

  • New York

    • 919 Third Avenue
    • New York, NY 10022
    • United States of America
      • +1 212.756.2000 Phone
      • +1 212.593.5955 Fax
  • Washington, DC

    • 901 Fifteenth Street, NW, Suite 800
    • Washington, DC 20005
    • United States of America
      • +1 202.729.7470 Phone
      • +1 202.730.4520 Fax
  • London

    • One Eagle Place
    • London SW1Y 6AF
    • United Kingdom
      • +44 (0) 20 7081 8000 Phone
      • +44 (0) 20 7081 8010 Fax

As we discussed in an earlier Alert,[1] on Aug. 26, 2020, the SEC broadened[2] the definitions of “accredited investor” (“AI”) in Regulation D under the Securities Act of 1933. The AI definition is key in determining who is eligible to participate, under the safe harbor contained in Rule 506 of Regulation D, in offerings of securities not subject to registration under the Securities Act. The exemption afforded by Regulation D is widely relied upon by private fund managers as well as other types of issuers.

The final rule largely reflects the SEC’s December 2019 proposal, and is primarily a collection of gap-filling amendments. Among other changes, the Final Rule adds to Rule 501(a) two new categories of natural person AIs (“knowledgeable employees” as defined in Rule 3c-5(a)(4) of the Investment Company Act of 1940, and holders of the FINRA Series 7, 65 and 82 exam credentials) and several new categories of qualifying entities (including exempt reporting advisers, family offices and their clients, and, as a “catch all,” entities not otherwise covered with more than $5 million in investments generally).

While the expansion of the types of investors that qualify as AIs is relatively modest, they should be understood by all private fund managers that rely on Regulation D, if only because these amendments likely will require changes to fund subscription documentation.

This article appeared in the October 2020 edition of SRZ’s Private Funds Regulatory Update. To read the full Update, click here.


 [1] See SRZ Alert, “SEC Updates Accredited Investor and QIB Definitions,” (Sept. 21, 2020), available here.

[2] See SEC, Amending the “Accredited Investor” Definition, Release Nos. 33-10824; 34-89669, (Aug. 26, 2020), available here.


This communication is issued by Schulte Roth & Zabel LLP and Schulte Roth & Zabel International LLP for informational purposes only and does not constitute legal advice or establish an attorney-client relationship. In some jurisdictions, this publication may be considered attorney advertising. ©2020 Schulte Roth & Zabel LLP and Schulte Roth & Zabel International LLP. All rights reserved. SCHULTE ROTH & ZABEL is the registered trademark of Schulte Roth & Zabel LLP.