Proposed Rules
Consistent with the language of Section 3(b)(2)(G)(i), we proposed to require Regulation A offering statements to be filed with the Commission electronically on EDGAR.210 We further proposed to amend Form 1-A, but to continue to have the form consist of three parts:
209 15 U.S.C. 77c(b)(2)(G)(i).
210 See proposed Rule 252(e).
Part I: an eXtensible Markup Language (XML) based fillable form;
Part II: a text file attachment containing the body of the disclosure document
and financial statements; and
Part III: text file attachments, containing the signatures, exhibits index, and the exhibits to the offering statement.211
We further proposed to require all other documents required to be submitted or filed with the Commission in conjunction with a Regulation A offering, such as ongoing reports, to be submitted or filed electronically on EDGAR.212
Additionally, we proposed an access equals delivery model for Regulation A final offering circulars.213 Under the proposed rules, issuers would be required to include a notice in any preliminary offering circular used that would inform potential investors that the issuer may satisfy its delivery obligations for the final offering circular electronically.214 As with registered offerings, we also proposed aftermarket delivery obligations for dealers that would be satisfied if the final offering circular is filed and
available on EDGAR and the appropriate notice was given by the dealer.215
Consistent with prior Commission releases on the use of electronic media for delivery purposes, we proposed that “electronic-only” offerings of Regulation A securities
211 See Proposing Release, at Section II.C.1.
212 Id.
213 Id.
214 See proposed Rule 254(a).
215 As proposed, a dealer would generally be required to deliver a copy of the current offering circular to purchasers for all sales that occur within 90 calendar days after qualification, although this requirement would be satisfied when the final offering circular is filed and available on EDGAR and the dealer has otherwise complied with the obligation to deliver a notice of sales to the purchaser not later than two business days after completion of such sale. See proposed Rules 251(d)(2)(ii)-(iii).
would not be prohibited, but an issuer and its participating intermediaries would have to obtain the consent of investors to the electronic delivery of:
the preliminary offering circular and other information, but not the final offering circular, in instances where, upon qualification, the issuer plans to sell Regulation A securities based on offers made using a preliminary offering circular; and all documents and information, including the final offering circular, when the issuer sells Regulation A securities based on offers conducted during the
post-qualification period using a final offering circular.216
We further proposed to maintain the existing requirements in Regulation A, which require dealers to deliver a copy of the current offering circular to purchasers for sales that take place within 90 calendar days after qualification.217 We proposed to update and amend Rule 251(d)(2)(i)218 to require issuers and participating broker-dealers to deliver only a preliminary offering circular to prospective purchasers219 at least 48 hours in advance of sale when a preliminary offering circular is used during the prequalification period to offer such securities to potential investors. We also proposed to continue to require a final offering circular to accompany or precede any written communication that constitutes an offer in the post-qualification period.220