Our attorneys advise startups, privately held and publicly traded companies in private placement transactions, crowdfunding (Reg A+) and initial public offers (IPOs). Our deep understanding and experience in securities laws and regulations provide our clients with meticulous advisory to enhance and protect our clients’ interests.
Recently, in 2015, the Securities and Exchange Commission (SEC) released the final Regulation A+ equity crowdfunding rules under Title IV of the JOBS Act that allows for up to $50 million to be raised from all investors including unaccredited investors. This new mini-IPO style offering may serve as an alternative to venture capital.
Our attorneys can draft and prepare term sheets, private placement memoranda (PPMs), subscription agreements, offering prospectuses, registration statements, and other business agreements such as LLC and partnership agreements for equity or debt securities transactions.
Securities laws require sales and offers of equity and debt securities offerings to be registered under the Securities Act of 1933 or qualify for an exemption from registration. To qualify for an exemption from registration transactions are structured in such a manner to adhere to Section 4(a)(2) of the Securities Act of 1933 and/or the safe harbor of Regulation D in private placement transactions. Regulation A+, a newly revised exemption for crowdfunding, is also available.
Early stage startup and emerging company transactions such as seed, angel and venture capital investments generally are structured as private placement transactions, which require exemption from registration. Qualifying for an exemption from registration requires meticulous analysis of federal and state securities laws and regulations including SEC regulations. Since only one mistake can expose your company to economic, regulatory and other potential liabilities and risks experienced and high quality counsel is critical.
Diligence and care must be taken to ensure that regulatory requirements relating to sales and marketing practices are followed, investor qualifications, terms of the transaction, representations and warranties and various other provisions are adhered to and also to enhance and protect the interests of clients.
