By Lauren Mack Companies seeking to raise capital – whether through selling equity, convertible notes, or any other security – in the United States must navigate a complex landscape of securities laws and regulations. They are subject not only to federal regulations, but also the laws of each state in which an investor (or soon-to-be investor) resides. The general rule under federal law is that …
SEC Issues New Guidance on General Solicitation and Advertising in Regulation D Offerings
By Lauren Mack On August 6, 2015, the SEC’s Division of Corporation Finance (“DCF”) updated its Compliance and Disclosure Interpretations (“CDI”) with eleven new CDI on general solicitation and advertising in Regulation D offerings. That same day, the DCF also issued a no-action letter finding that an online venture capital firm’s procedures for creating online pre-existing substantial relationships did not constitute general solicitation and advertising …
Easing the Ban on General Solicitation
As Congress grapples with ways to kick start the economy and spur small business growth and hiring, one proposal gaining momentum is to relax or even eliminate the long-standing ban on general advertising or solicitation imposed on private companies seeking to raise capital under the private placement rules of Reg D of Section 4(2) of the 1933 Securities Act.