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Raising Capital Through Exempt Offerings

July 7, 2015

Regulation A+, Modernizing Regulation A

Title IV of the Jumpstart Our Business Startups Act (“JOBS Act”), popularly known as
Regulation A+, authorized the SEC to modernize and expand the existing Regulation A for offerings of up to $50 million.  On March 25, 2015, the SEC adopted final rules to implement the mandate, which will become effective 60 days after publication in the Federal Register.[1]

The final rules establish two tiers of offerings:

  • Tier 1: Annual offering limit of $20 million, including no more than $6 million on behalf of selling security holders that are affiliates of the issuer; and
  • Tier 2: Annual offering limit of $50 million, including no more than $15 million on behalf of selling security holders that are affiliates of the issuer.
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All postings are intended to be planning tools to familiarize readers with some of the high-level issues discussed therein. No posting is intended to be a comprehensive discussion and additional details should be discussed with your transaction planners including attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. This article should not be treated as legal advice to any person or entity.