Exempt Offerings  JOBS Act Solutions

advising on exempt offerings to find investors.  


Rule 506(c & Regulation S

Posted on June 7, 2018 at 3:55 PM Comments comments (0)

The ideal exempt offering is offered globally with online general solicitation. In the U.S., it is illegal to sell securities that are not registered or exempt. The most popular exemption, Rule 506(c, covers accredited investors who are U.S. persons and whose accreditation status can be verified. Regulation S exempts offerings made to non-U.S. persons.

If an issuer only uses Regulation S, sales can only be made to non-U.S.persons. Launching two side-by-side offerings with one relying on Regulation S and the other on Rule 506(c, therefore, has compelling advantages to most issuers.

Note: If an issuer only uses Rule 506(c, it must verify every investor as accredited, even non-U.S. investors.

Take care to treat each offering as a separate offering.

• Insure best practices for a 506(c offering, including third-party verification of your investors’ accredited status.

• Insure best practices for a Regulation S offering, including qualification of its investors.

The dual offerings must clearly delineate between U.S. and foreign investors. Practice tip: Before launching a dual offering, set up two separate websites.

Resale Restrictions

Both Rule 506(c and Regulation S have important resale restrictions; they are different and they are state and fact distinct.

Douglas Slain https://www.linked com/in/douglasslain/

ICOs & Regulation S

Posted on May 5, 2018 at 3:55 PM Comments comments (0)

Outside the United State, ICO issuers can offer securities in reliance on Regulation S.

When a U.S. company relies on Regulation S, there is a period during which the securities cannot be transferred to “U.S. persons” which is a year for equity securities and 40 days for debt securities. This means that it is important to establish whether the securities are equity or debt. As with Regulation D, issuers must reflect these requirements in the smart contracts that govern trading.

Regulation S securities cannot be “offered” to U.S. persons. There cannot be an open-to-everyone website that describes Regulation S securities, even if the site says, “We must not and cannot sell these to U.S. persons.” That is still an offer (hard to believe but true).

It is best to put the website that describes Regulation S securities behind a firewall that requires investors to certify their non-US status before allowing them to view the offering. Some use Geofencing technology to block all US IP addresses.

Investors should certify that they are not “U.S. persons” and that they promise not to resell to U.S. persons. Those certifications should be made in the investor’s real name, not as a “check the box” entry. Additionally, while initial sales under Regulation D and Regulation A+ are “pre-empted” from state regulation, that is not the case for Regulation S. There are some states that regulate offerings made from those states.Check on those requirements before undertaking a Regulation S offering.

Regulation S only instructs on how to deal with U.S. Federal and state regulations. Issuers need to make sure that they comply with the regulations of the countries where the investors are located. They should block IP addresses from any jurisdictions where the securities cannot be sold.


Join the State Securities Regulation LinkedIn discussion group and go down the crypto rabbit hole with us to learn 1) what will constitute securities in the eyes of state regulators and the SEC, and 2) what will constitute best practices for exempt offerings of ICO offerings. Members of the discussion group are entitled to any of 21 audio handbooks on exempt [email protected] https://www.audible.com/search/ref=a_hp_tseft?advsearchKeywords=Douglas%20Slain&filterby=field-keywords

What is the difference between Rule 147 and Rule 147A?

Posted on April 8, 2018 at 9:35 PM Comments comments (0)

 Rule 147A lifts the ban on general solicitation found in Rule 147. Issuers can use social media and other internet-based opportunities even if the actual sales of the issuer's securities can only be made in one state. Otherwise, Rule 147A is substantially identical to Rule 147 except that it allows issuers to be incorporated out-of-state.

This change means that a Delaware corporation that is headquartered in Texas can take advantage of Rule 147's exemption when raising funds from Texas residents What is the new Rule 504? The SEC's new Rule 504 increases the aggregate amount of securities that may be offered and sold in any 12-month period from $1 million to $5 million, allowing more flexibility in smaller, private securities offerings. However, a consequence of the SEC's rule changes may be that many states legislatures will have to revisit their intrastate crowdfunding statutes to take advantage of these changes.

There are exceptions for offers and sales made in accordance with specified types of state registration provisions and exemptions. In some states an offering can now be made to unaccredited investors. Note that all sales (not offerings) made under Rule 506(c must be made to only accredited investors. (The SEC also repealed the widely ignored Rule 505, which permitted offerings of up to $5 million annually sold solely to accredited investors or no more than 35 non-accredited investors).

The 34 states that enacted their own, intrastate statutes ahead of the SEC's rules can continue to rely on those statues.

List of FINRA Approved Reg CF Crowdfunding Portals

Posted on June 3, 2017 at 11:05 PM Comments comments (0)

List of FINRA Approved Reg CF Crowdfunding Portals

1. Wefunder 2. StartEngine 3. NextSeed 4. Indiegogo / MicroVentures (First Democracy VC) 5. SeedInvest 6. FlashFunders 7. Open Deal (Republic) 8. Crowdboarders 9. CrowdSourceFunded 10. DreamFunded Marketplace 11. Funding Wonder Crowd 12. GridShare 13. GrowthFountain Capital 14. IndieCrowdFunder 15. JumpStart Micro 16. Kasdaq (Mr. Crowd) 17. MinnowCFunding 18. NetCapital Funding Portal 19. Not So Small Change (Small Change) 20. Razitall 21. TruCrowd

New $5 million limit for intrastate offerings

Posted on April 17, 2017 at 2:05 PM Comments comments (0)


The North American Securities Administrators Association (NASAA) and the SEC have agreed that companies should be given more flexibility to engage in intrastate offers through websites and social media--without having to register their offering with the Federal government. Companies can now raise up to $5 million per year through the amended rules. The previous limit was $1 million. The rules are effective this month.

Fiduciary Rule Trumped?

Posted on April 4, 2017 at 10:30 PM Comments comments (0)

The Department of Labor just released a final rule delaying the implementation of its fiduciary duty regulation. The fiduciary rule's April 10 applicability date is pushed back to June 9. The means that the expanded definition of who is a fiduciary when giving advice to clients in retirement accounts will become applicable on June 9, unless extended again.

The DOL is seeking the delay because President Trump told the agency to modify or repeal the regulation if possible. The rule requires financial advisers to act in the best interests of clients when giving retirement investment advice, to protect from conflicted advice that can lead to the sale of inappropriate, high-fee investments that erode savings. President Trump says the rule is too complex and costly. The delay of the April deadline for the Department of Labor's fiduciary rule is likely to last longer than the 60 days the agency is seeking.

Questions? Contact [email protected]

New Intrastate exemption better than 506(c ?

Posted on April 2, 2017 at 11:20 PM Comments comments (0)

Small companies now have more flexibility to engage in intrastate offers through websites and social media without having to register with the SEC. Companies can now raise up to $5 million per year; the previous limit was $1 million. Other new rules permit companies to use intrastate offerings to raise money within a region of states, as opposed to one state. The amended rules facilitate greater access to capital for entrepreneurs who have not been able to otherwise access capital.

Email [email protected] for more information.

Audio exempt offering handbooks: http://www.audible.com/search/ref=a_search_c4_1_1_1_srAuth?searchAuthor=Douglas+Slain&qid=1487524144&sr=1-1

JOBS Act expansion

Posted on March 17, 2017 at 5:25 PM Comments comments (0)

The North American Securities Administrators Association (NASAA) and the SEC have agreed that companies should be given more flexibility to engage in intrastate offers through websites and social media--without having to register their offering with the Federal government. Companies can now raise up to $5 million per year through the amended rules. The previous limit was $1 million. The rules are effective as of April 2017.

Private Placement Advisors LLC

[email protected]

Handbook and crowdfunding platforms

Posted on September 28, 2015 at 3:25 PM Comments comments (0)

Handbooks: http://www.privateplacementadvisors.com/handbooks

Crowdfunding platforms: http://www.sanfranciscofunding

Connect with Douglas Slain

Email: [email protected]

LinkedIn: http://linkedin.com/in/douglasslain

Twitter: https://twitter.com/exemptofferings

Blog: http://www.privateplacementadvisors.com/apps/blog