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Frequently Asked Questions
  Who is considered to be a consultant for purposes of Listing Rule 5635(c)?
Identification Number 211
A consultant is anyone for whom the company is eligible to use a Form S-8. The instructions for the Form S-8 state that: "Form S-8 is available for the issuance of securities to consultants or advisors only if: (i) they are natural persons; (ii) they provide bona fide services to the registrant; and (iii) the services are not in connection with the offer or sale of securities in a capital-raising transaction, and do not directly or indirectly promote or maintain a market for the registrant's securities."

Notwithstanding the requirement that a consultant must be a natural person, under the SEC guidance, where the consultant performs services for the issuer through a wholly-owned corporate alter ego, the issuer may contract with, and register securities on Form S-8 as compensation to that corporate entity.  See Release No. 33–7646, 34–41109, 64 FR 11103 (March 8, 1999) (citing to Aaron Spelling Productions, SEC No-Action Letter (July 1, 1987)). Accordingly, issuances to such entity, may constitute equity compensation under Listing Rule 5635(c).

Publication Date*: 9/17/2020 Mailto Link Identification Number: 211
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