We have a project and are interested in soliciting investors without violating SEC rules. What can we say thats legal but still gets the point across, and what is illegal?
The most important thing to say is that you are not making an offer. You are simply having a preliminary discussion with people. In order to take money from investors, you need to either register your company with the SEC, which costs a considerable sum, or fall into one of the limited offering exemptions. A major restriction on these limited offerings exemptions is that you cannot do any public solicitations like mass mailings and cold-callings. And you’ll be limited to thirty-five unaccredited investors. An accredited investor is essentially a wealthy, sophisticated investor. Everyone else is an unaccredited investor. If you can live with those restrictions, the cost of complying with securities laws is considerably less but still significant. If you violate the securities laws, you can be subject to civil and criminal penalties. Question: Putting together a business plan just makes good business sense. However, I gather that it is a legal requirement. Is there a form that the SEC or
Related Questions
- Is my company subject to any rules and conditions when awarding MileagePlus Reward Miles? What other important legal information do I need to know?
- What type of legal system has Lithuania got? Are there any rules that govern civil procedure in Lithuania?
- What type of legal system has Brazil got? Are there any rules that govern civil procedure in Brazil?
