Appendix A Regulation A requirements as compared with the new section 3(b)(2) exemption
Regulation A exempt public offering
Offering limit
SEC filing requirements Blue sky
requirements
Limitations on investors
Restrictions on resale of securities
Offering communications Up to $5 million within the prior 12-month period.
Must file with the SEC a Form 1-A, which is reviewed by the SEC staff.
Blue sky law compliance is required, without in many cases the possibility for a more streamlined registration by coordination process.
No limits on investors, except to the extent imposed under state laws.
No restrictions on the resale of securities, except to the extent that the securities are held by affili- ates.
An issuer may test the waters to determine if there is interest in a proposed offering before fil- ing the Form 1-A. Sales literature may be used before the filing of the Form 1-A, after filing, and following qualification.
Financial statement requirements
A current balance sheet, as well as income state- ments for a period of two years, as well as any interim period. Financial statements must be pre- pared in accordance with GAAP but do not have to conform to Regulation S-X and, in most cases, do not have to be audited.
Disqualification provisions
Periodic reporting
Felons and bad actors disqualified from the offer- ing in accordance with Securities Act Rule 262.
No reporting required after the offering, other than to disclose the use of proceeds.
Section 3(b)(2) exempt public offering
Up to $50 million within the prior 12-month period.
Must file with the SEC and distribute to investors an offering statement, which will likely be reviewed by the SEC staff.
Blue sky law compliance is required, except when the securities are offered and sold on a national securities exchange, or the securities are offered or sold to a qualified purchaser.
No limits on investors, except to the extent imposed under state laws.
No restrictions on the resale of securities, except to the extent that the securities are held by affili- ates.
An issuer may test the waters to determine if there is interest in a proposed offering before fil- ing an offering statement.
Audited financial statements must be included in the offering statement, as determined by the SEC.
Felons and bad actors disqualified from the offer- ing in accordance with rules adopted under sec- tion 926 of the Dodd-Frank Act.
Audited financial statement must be filed and provided to investors annually, and the SEC may require other periodic disclosures.
JOBS Act Quick Start 57
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