The SEC has proposed changes to Rule 147. You can find the proposed amendments here. Rule 147 is one of the federal securities law rules that makes state-level equity crowdfunding more difficult. The reason? Rule 147 is the rule issued pursuant to Section 3(a)(11) of the Securities Act of 1933. Section 3(a)(11) is the statutory basis … Continue reading Rule 147: Good News
The SEC has scheduled a meeting for this coming Friday to vote on the final equity crowdfunding rules under the JOBS Act. The SEC’s notice of the meeting says: Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Pub. L. 94-409, that the Securities and Exchange Commission will hold … Continue reading Equity Crowdfunding: SEC To Vote This Friday
Once again I had the fun opportunity to work on a writing project with Lauren Hakala from Practical Law. This time we updated the previous piece we had written on General Solicitation, to take into account the recent SEC guidance. General Solicitation: What Are the Highlights of the SEC’s New Guidance? The SEC provided helpful … Continue reading General Solicitation & Startup Capital Raising
Is a Demo Day a general solicitation of securities putting your company in Rule 506(c) as opposed to 506(b)? The SEC has issued new guidance on this question. Per the SEC’s new guidance, a Demo Day is not necessarily a general solicitation. However, it depends on what you do at the Demo Day. If you … Continue reading Is a Demo Day General Solicitation?
There is a lot of confusion in the early stage company ecosystem about general solicitation. When you are trying to sell shares in your company (or a convertible note, or convertible equity), how much can you say about that in the media? Can you post something on Facebook? On Twitter? On LinkedIn? How about emailing a … Continue reading General Solicitation: Can I Generally Solicit My Offering?
Last Thursday the SEC issued guidance on what constitutes general solicitation. This guidance is helpful to companies trying to conduct Rule 506 offerings. Thanks to the JOBS Act, we now have two types of Rule 506 offerings. Those that cannot be generally solicited and those that can. This might sound harmless but if you generally … Continue reading New SEC Guidance on General Solicitation
By Evan Jensen and Joe Wallin and Jordan Rood If you are considering token sales and selling blockchain tokens in the U.S., you not only have to worry about the U.S. federal securities laws (see the latest from the SEC here), but also the laws of each state within the U.S. in which you sell … Continue reading Token Sales & The Risk Capital Test
Guest post by Teresa Daggett First, let’s get the terminology of term sheets out of the way. Whether the document that outlines your deal is called a “term sheet,” a “memorandum of understanding” or a “letter of intent,” these terms mean essentially the same thing. We will use “term sheet” in this article, but the … Continue reading Term Sheets: Binding & Non-Binding
By Daniel Neuman. I am a corporate and securities lawyer, working primarily with startups and early-stage companies in Seattle. I testified yesterday before the Washington State House of Representatives Business & Financial Services Committee regarding the state’s Equity Crowdfunding law, and presented a list of recommendations for how to improve the regulations and make the law … Continue reading Recommended Improvements to Washington’s Equity Crowdfunding Law
Section 201(a) of the JOBS Act repealed the ban on generally soliciting or generally advertising private securities offerings, provided certain conditions were met. Many people believed that this change in the law would be one of the most dramatic brought about by the JOBS Act. But things didn’t go as planned. Today, only a small … Continue reading 506(c) Offerings: Let’s Fix the Verification Rules