Tombstone Ad Rules: Contents, Legends, and FINRA Filing Exemption

Tombstone ad rules come from SEC Rule 134 under the Securities Act of 1933, which lets a company or its underwriters publish a public notice of a pending securities offering only if the notice sticks to a specific list of factual items and carries required legends. Anything outside that list — projections, sales language, promotional visuals — pushes the communication out of the safe harbor and into the offer-of-securities restrictions that Section 5 enforces during registration.¹

Why the Rules Exist

The Securities Act splits every public offering into three periods, and each one changes what the issuer can say. Before a registration statement is filed, Section 5(c) prohibits any offer to sell securities through interstate commerce or the mail.² No press releases hyping the deal, no investor dinners, no media push. The SEC calls a violation “gun-jumping” and has treated it as an enforcement priority since the Act’s earliest years.³

Once the registration statement is filed, the offering enters the waiting period until the SEC declares it effective. Oral offers are allowed and a preliminary prospectus can be circulated, but written communications are tightly limited. Rule 134 carves the tombstone ad out from the definition of a “prospectus,” so long as the ad sticks to the permitted facts and carries the required disclaimers.¹ Without that carve-out, there would be no lawful way to publicly announce a deal is happening until shares are actually ready to sell.

What a Tombstone Ad May Contain

Rule 134 works as a whitelist. It doesn’t describe what’s banned; it lists what’s allowed, and anything not enumerated is off-limits.¹ The permitted items include:

Issuer identity: name, address, phone number, email, country of organization, and where the company does business.
Security details: the title of the security being offered and the total amount, including conversion or ranking information.
A brief indication of the general type of business (manufacturing, public utility, and so on), with nothing evaluative.
Pricing: the offering price, the method for determining it, or a good-faith estimated range.
For debt securities, the maturity date, interest rate, and yield or estimated yield range.
A brief description of the use of proceeds.
The names of managing underwriters and other participating firms, plus the type of underwriting arrangement.
Anticipated timing, marketing events, and procedures for submitting indications of interest.
Exchange listings, ticker symbols, CUSIP numbers, and any legends required by state securities regulators.

SEC guidance from 1937 put it more bluntly: a tombstone ad “must do no more than identify the security, state the offering price, and state by whom orders will be executed.”⁴ That principle hasn’t changed since.

Required Legends

Listing only permitted items isn’t enough. Rule 134(b) requires two specific statements in the communication, and omitting either strips away the safe harbor.

First, if the registration statement is not yet effective, the ad must include language to this effect: “A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective.”¹ Second, the ad must give the name and address of someone from whom a written prospectus can be obtained. Together, the legends remind readers that the offering isn’t final and point them toward the disclosure document that contains the full picture.

If the communication goes further and solicits indications of interest, Rule 134(d) requires an additional disclosure.⁵ A simple announcement carries lighter requirements than a communication that actively seeks buyer engagement.

What a Tombstone Ad Cannot Contain

Because Rule 134 is a whitelist, everything outside it is off-limits. Certain categories cause the most trouble.

Any discussion of the company’s merits, financial condition, or business prospects is forbidden. The 1937 SEC guidance warned that “the inclusion of any reference to the merits of the securities advertised, or of any description of the business or financial condition of the issuing corporation, or any other form of selling talk, will exceed the permitted limits.”⁴ No projections. No comparisons to competitors. No language suggesting the securities are a good buy. Descriptive adjectives that frame the offering favorably — calling a company “industry-leading” or describing demand as “strong” — push the ad outside Rule 134.

Visual elements are similarly constrained. The regulation doesn’t list banned graphics, but because it only permits specific textual data points, anything beyond that text has no basis for inclusion. Company logos, colorful layouts, and photographs are absent from tombstone ads not because a rule bans them, but because no provision authorizes them.

Consequences of Getting It Wrong

Section 5 violations can bring SEC enforcement, including injunctions and cease-and-desist orders.² The SEC can also issue a stop order suspending the effectiveness of the registration statement, which freezes the offering until the problem is fixed.

The larger exposure is private. Investors who purchased securities in an offering tainted by gun-jumping can seek rescission, meaning they can demand their money back. For a company that just raised hundreds of millions of dollars, the threat of mass rescission is enormous. That risk is why securities lawyers scrub tombstone ad language so heavily and why the dry aesthetic of these notices is deliberate.

Tombstone Ads on Social Media

Platforms like X impose character limits that can make it physically impossible to include the full mandatory legends. SEC staff guidance permits an active hyperlink to satisfy the legend requirement, provided three conditions are met: the platform has a genuine technological limit on text length, including the full legends would exceed that limit, and the communication contains a hyperlink with introductory language making clear that important required information is accessible through the link.⁵

If the platform can fit the full text within its limits, the hyperlink shortcut isn’t available. Technology constraints get an accommodation; convenience doesn’t.

FINRA Filing Exemption

Broker-dealers participating in a tombstone ad get a break on the FINRA side. Under FINRA Rule 2210, retail communications prepared under Rule 134 are excluded from FINRA’s pre-use filing requirements.⁶ Because the SEC already constrains the content so tightly, FINRA doesn’t require separate review before publication. The Rule 134 restrictions are stricter than FINRA’s general advertising standards to begin with.

What These Rules Do Not Cover

Not every notice that looks like a tombstone is subject to Rule 134. After a merger, acquisition, or major financing closes, advisory banks often publish a “closing tombstone” announcing the completed transaction. These are commemorative and don’t involve the offer or sale of securities to the public, so Section 5 and the Rule 134 whitelist don’t apply. They’re governed by general advertising standards, including FINRA’s requirements that member communications be fair and not misleading. That’s why closing tombstones freely include corporate logos and omit the SEC legends — those are the quickest visual cues that a notice is commemorative rather than an offering announcement.

1
eCFR. 17 CFR 230.134 – Communications Not Deemed a Prospectus
2
Office of the Law Revision Counsel. 15 USC 77e – Prohibitions Relating to Interstate Commerce and the Mails
3
U.S. Securities and Exchange Commission. Gun-Jumping Problems Under Section 5 of the Securities Act
4
U.S. Securities and Exchange Commission. Financial Advertising Under the Securities Act of 1933
5
U.S. Securities and Exchange Commission. Securities Act Rules – Staff Guidance
6
FINRA. FINRA Rule 2210 – Communications With the Public