Who Can Conduct A Regulation A+ Offering? Going Public

Regulation A+ Offerings - Securities Lawyer

On March 25, 2015, the Securities and Exchange Commission (“SEC”) adopted amendments to Regulation A known as Regulation A+. Regulation A+ was adopted to facilitate capital-raising by smaller companies. Regulation A+ offerings cannot be undertaken by all companies or used to offer and sell all types of securities. This blog post addresses eligibility requirements of Regulation A+ offerings.

Securities Eligible For Regulation A+ Offerings

Only equity securities, including warrants, options, debt securities and debt securities convertible into or exchangeable for equity interests, can be offered and sold in Regulation A+ offerings.

Regulation A+ Offerings – Eligible Issuers

Regulation A+ offerings can only be conducted by companies that are domiciled in and have their principal place of business in the United States or Canada. As such, foreign issuers may not conduct Regulation A+ offerings and must locate an alternative exemption for their unregistered offering.

Regulation A+ offerings cannot be conducted by issuers who have had their registration with the SEC revoked pursuant to Section 12(j) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) if the order was entered into within five years before the filing of the issuer’s Regulation A offering statement.  Further, Regulation A+ is not available to issuers with certain “bad actors”.

Issuers who fail to comply with the SEC’s ongoing reporting requirements of Regulation A during the two years immediately preceding the filing of a new Regulation A offering statement will not be eligible to conduct a Regulation A offering.

Lastly, certain issuers are ineligible to use Regulation A+ for their securities offering including:

  • Blank Check Companies,
  • SEC Reporting Companies,
  • Investment Companies registered under the Investment Act including business development Companies, and
  • Entities which issue undivided interests in oil or gas rights or similar mineral rights.

This securities law blog is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship.  For more information, please contact Hamilton and Associates at (561) 416-8956 or [email protected].  Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Regulation A Attorneys
Brenda Hamilton, Securities Attorney
101 Plaza Real South, Suite 202 N
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855