October 15, 2021

Volume XI, Number 288

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SEC Issues TurnKey Jet, Inc. No-Action Letter

On April 3, the Securities and Exchange Commission’s Division of Corporate Finance (the “Division”) responded to TurnKey Jet, Inc.’s (TKJ) letter dated April 2, requesting confirmation that the Division would not recommend enforcement action to the SEC in connection with its offer and sale of tokens without registration under the Securities Act of 1933 and the Securities Exchange Act of 1934. In issuing its response that it would not recommend enforcement action to the SEC, the Division noted that:

  • the tokens will be immediately usable for their intended functionality (purchasing air charter services) at the time they are sold;
  • TKJ will restrict transfers of tokens to TKJ Wallets only, and not to wallets external to the platform;
  • TKJ will sell tokens at a price of one USD per token throughout the life of the program, and each token will represent a TKJ obligation to supply air charter services at a value of one USD per token;
  • if TKJ offers to repurchase tokens, it will only do so at a discount to the face value of the tokens (one USD per token) that the holder seeks to resell to TKJ, unless a court within the United States orders TKJ to liquidate the tokens; and
  • the token is marketed in a manner that emphasizes the functionality of the token, and not the potential for the increase in the market value of the token.

The Division’s full response, dated April 3, is available here, and TKJ’s incoming letter, dated April 2, is available here.

©2021 Katten Muchin Rosenman LLPNational Law Review, Volume IX, Number 95
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About this Author

Michael T. Foley, Katten, Lawyer, Finance, FINRA, Chicago
Special Counsel

Michael Foley represents broker-dealers, investment advisers and other financial services industry participants with respect to a broad spectrum of legal and regulatory matters arising under the federal securities laws.

Michael has nearly 20 years of experience in private practice and in-house at both a large, full-service broker-dealer and at an online discount broker-dealer, advising broker-dealers and other financial institutions regarding compliance with the federal securities and commodities laws, and with the regulations of the US Securities and Exchange...

312-902-5452
Susan Light, Katten Law Firm, Finance Law Attorney, New York
Partner

Susan Light focuses her practice on financial services regulatory matters. She counsels broker-dealers, hedge funds, investment banks and financial services clients on enforcement issues involving the Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority (FINRA), other self-regulatory organizations (SROs) and state and federal regulatory authorities. She has particular experience related to sales practice issues, financial and operational issues, anti-money laundering, crowdfunding, cybersecurity, and cryptocurrencies.

...
212-940-8599
Associate

Leonard Licht is an associate in the Financial Services practice. He advises a broad range of financial market participants, including investment managers to private funds and investors in private funds. Prior to joining Katten, Lenny practiced as a corporate and securities attorney and has also worked in an analytical capacity with a family office.

While in law school, Lenny was a Heyman scholar and member of the Moot Court Honor Society.

212-940-6587
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