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Tagged Posts: Texas Crowdfunding Portal’

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption (Part 5)

January 5, 2016

Texas Crowdfunding Portal Registration and Activities (in Detail).

Simplified/Streamlined Registration Process. The simplified registration process for TCPs, which we discussed previously, is designed so that TCPs are subject to fewer regulatory requirements than general securities dealers, because they are limited in what they can do.[1]

No Investment Advice. Of note, a TCP is prohibited from offering investment advice or recommendations, so in listing issuers on its platform, it is important for the TCP not to provide an implicit endorsement or recommendation.… Read the rest

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption (Part 4)

December 22, 2015

Texas Crowdfunding Portal Registration and Activities.

As we mentioned previously, an offering conducted under the crowdfunding exemption must be made exclusively through an Internet website operated by a registered general dealer or registered TCP.

Local Character. Just like crowdfunding issuers, a TCP must be an entity formed and authorized to do business in Texas.[1]  A TCP should be physically located in and operate exclusively within Texas.[2] Moreover, a TCP must be engaged exclusively in intrastate offers and sales of securities in Texas and limit its activities to operating an Internet website utilized to offer and sell securities under the Texas crowdfunding exemption, without operating or facilitating a secondary market in securities.… Read the rest

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption (Part 3)

December 17, 2015

How Should the Offering Be Conducted?

Must Use a website. An offering conducted under the crowdfunding exemption must be made exclusively through an Internet website operated by a registered general dealer or registered TCP.[1] Such website must meet the following requirements:

  • A disclaimer that access to the website and offers and sales of the securities are limited to Texas residents;
  • An affirmative representation by a visitor to the website that the visitor is a Texas resident before they can view information on the website;
  • Evidence of Texas residency before a sale can be made to a prospective purchaser, e.
Read the rest

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption (Part 2)

December 12, 2015

Who Is Eligible?

Texas Formation. Texas crowdfunding exemption is only available if the issuer is a Texas entity that has filed a certificate of formation with the Texas Secretary of State and is authorized to do business in Texas.[1] This means that sole proprietor, general partnerships, or joint ventures would not be eligible to use the exemption, as those types of businesses do not file a certificate of formation, nor would companies whose certificate has been terminated or forfeited for failure to file a required report, to pay franchise tax or penalty, or to maintain a registered office or registered agent.… Read the rest

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption

December 8, 2015

In our previous blog series titled “Crowdfunding: Is It Right for My Business?”, we discussed Title III of the JOBS Act, popularly known as the “CROWDFUND Act (Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act of 2012),” which would exempt crowdfunded securities from the federal registration requirement. On October 30, 2015, the Securities and Exchange Commission (‘SEC”) finally voted to adopt the final rules to implement the law (see our previous blog titled “SEC Votes To Adopt Federal Crowdfunding Rules”).… Read the rest

An Easy Way for Texas Companies To Raise Money? A Discussion of the Texas Crowdfunding Exemption (Part 5)

January 5, 2015

Texas Crowdfunding Portal Registration and Activities (in Detail).

Simplified/Streamlined Registration Process. The simplified registration process for TCPs, which we discussed previously, is designed so that TCPs are subject to fewer regulatory requirements than general securities dealers, because they are limited in what they can do.[1]

No Investment Advice. Of note, a TCP is prohibited from offering investment advice or recommendations, so in listing issuers on its platform, it is important for the TCP not to provide an implicit endorsement or recommendation.… Read the rest

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.