Regulation A+

Regulation A+ is an SEC© mandated exemption to registration requirements for issuing securities.

The regulation exempts US and Canadian companies from filing reports under the Exchange Act to raise up to $50 million in a 12-month period. The updated Regulation A+ rules creates two tiers for securities offerings.

Tier 1 consists of securities offerings of up to $20 million in a 12-month period, with not more than $6 million in offers by selling security-holders that are affiliates of the issuer.

Tier 2 consists of securities offerings of up to $50 million in a 12-month period, with no more than $15 million in offers by selling security-holders that are affiliates of the issuer.

For offerings up to $20 million, issuers can elect to proceed under Tier 1 or Tier 2. Both tiers are subject to basic requirements such as issuer eligibility, disclosure, and other matters. Both tiers would also allow companies to submit draft offering statements for non-public review by Commission staff before filing, permit the continued use of solicitation materials after filing the offering statement and require the electronic filing of offering materials to the SEC© EDGAR© system.

Tier 1 offerings will be subject to federal and state registration and qualification requirements. For more information on state specific requirements, please click here.

Tier 2 has additional requirements that do not apply to Tier 1 offerings. Companies under the Tier 2 exemption are subject to the following requirements:

Provide audited financial statements
File annual, semiannual and current event reports.
Limitation on the amount of securities non-accredited investors can purchase in a Tier 2 offering of no more than 10 percent of the greater of the investor’s annual income or net worth.