THE ROAD MAP: WHERE TO FIND DETAILED DISCUSSION OF REGULATION CROWDFUNDING

Title III of the JOBS Act added a new Section 4(a)(6) to the Securities Act of 1933 to permit companies to engage in crowdfunded offerings of securities without having to go through the public offering registration process. The exemption is subject to many conditions, which are described in detail in Chapter 13.

Title III also added the new Section 4A to the Securities Act, containing numerous hoops that issuers, funding portals, and investors will need to jump through in order to launch a successful crowdfunded offering. Regulation Crowdfunding, which implemented these requirements, contains almost seven hundred pages of new regulations, which are too numerous and detailed to be described in a single chapter.

Accordingly, the author has spread discussion of Regulation Crowdfunding over several chapters to help issuers and their professional advisers identify the rules and regulations that apply at each stage of the crowdfunded offering process, as follows:

Rules on an issuer’s eligibility for Title III crowdfunded offerings are described in Chapter 3.

Rules on the documents and financial statements that must be prepared and filed with the SEC and the funding portal before an issuer launches a crowdfunded offering are described in Chapter 5.

Rules on advertising and publicity during a crowdfunded offering, and changes in the offering terms made while the offering is pending, are described in Chapter 6.

Rules on an issuer’s responsibilities to investors after a crowdfunded offering has been completed are described in Chapter 7.

Rules for investors in crowdfunded offerings are described in Chapter 10.

Rules for funding portals are described in Chapter 11 but briefly, because this is a book primarily for issuers and their professional advisers, not entrepreneurs looking to set up funding portals under Title III; some resources for those folks are listed in the “Suggestions for Further Reading” section near the end of this book.