Amendments. All amendments to the reports described in paragraphs (a) and (b) of this section must be filed under cover of the form amended, marked with the letter A to designate the document as an amendment, e.g., “1-K/A,” and in compliance with pertinent requirements applicable to such reports. Amendments filed pursuant to this paragraph (c) must set forth the complete text of each item as amended, but need not include any items that were not amended. Amendments must be numbered sequentially and be filed separately for each report amended. Amendments must be signed on behalf of the issuer by a duly authorized representative of the issuer. An amendment to any
report required to include certifications as specified in the applicable form must include new certifications by the appropriate persons.
Suspension of duty to file reports. (1) The duty to file reports under this rule shall be automatically suspended if and so long as the issuer is subject to the duty to file reports required by section 13 or 15(d) of the Exchange Act (15 U.S.C. 78m or 15 U.S.C. 78o).
The duty to file reports under paragraph (b) of this section with respect to a class of securities held of record (as defined in Rule 12g5-1 (§ 240.12g5-1 of this chapter)) by less than 300 persons, or less than 1,200 persons for a bank (as defined in Section 3(a)(6) of the Exchange Act (15 U.S.C. 78c(a)(6)), or a bank holding company (as defined in section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841)), shall be suspended for such class of securities immediately upon filing with the Commission an exit report on Form 1-Z (§ 239.94 of this chapter) if the issuer of such class has filed all reports due pursuant to this rule before the date of such Form 1-Z filing for the shorter of:
The period since the issuer became subject to such reporting obligation; or
Its most recent three fiscal years and the portion of the current year preceding the date of filing Form 1-Z.
For the purposes of paragraph (d)(2) of this section, the term class shall be construed to include all securities of an issuer that are of substantially similar character and the holders of which enjoy substantially similar rights and privileges. If the Form 1-Z is subsequently withdrawn or if it is denied because the issuer was ineligible to use the form, the issuer must, within 60 calendar days, file with the Commission all reports
which would have been required if such exit report had not been filed. If the suspension resulted from the issuer’s merger into, or consolidation with, another issuer or issuers, the notice must be filed by the successor issuer.
The ability to suspend reporting, as described in paragraph (d)(2) of this section, is not available for any class of securities if:
During that fiscal year a Tier 2 offering statement was qualified;
The issuer has not filed an annual report under this rule or the Exchange Act for the fiscal year in which a Tier 2 offering statement was qualified; or
Offers or sales of securities of that class are being made pursuant to a Tier 2 Regulation A offering.
Termination of duty to file reports. If the duty to file reports is suspended pursuant to paragraph (d)(1) of this section and such suspension ends because the issuer terminates or suspends its duty to file reports under the Exchange Act, the issuer’s obligation to file reports under paragraph (b) of this section shall:
Automatically terminate if the issuer is eligible to suspend its duty to file reports under paragraphs (d)(2) and (3) of this section; or
Recommence with the report covering the most recent financial period after that included in any effective registration statement or filed Exchange Act report.
§ 230.258 Suspension of the exemption.
Suspension. The Commission may at any time enter an order temporarily suspending a Regulation A exemption if it has reason to believe that:
No exemption is available or any of the terms, conditions or requirements of Regulation A have not been complied with;
The offering statement, any sales or solicitation of interest material, or any report filed pursuant to Rule 257 (§ 230.257) contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading;
The offering is being made or would be made in violation of section 17 of the Securities Act;
An event has occurred after the filing of the offering statement that would have rendered the exemption hereunder unavailable if it had occurred before such filing;
Any person specified in Rule 262(a) (§ 230.262(a)) has been indicted for any crime or offense of the character specified in Rule 262(a)(1) (§ 230.262(a)(1)), or any proceeding has been initiated for the purpose of enjoining any such person from engaging in or continuing any conduct or practice of the character specified in Rule 262(a)(2)
(§ 230.262(a)(2)), or any proceeding has been initiated for the purposes of Rule 262(a)(3)-(8) (§ 230.262(a)(3) through (8)); or
The issuer or any promoter, officer, director, or underwriter has failed to cooperate, or has obstructed or refused to permit the making of an investigation by the Commission in connection with any offering made or proposed to be made in reliance on Regulation A.
Notice and hearing. Upon the entry of an order under paragraph (a) of this section, the Commission will promptly give notice to the issuer, any underwriter, and any selling securityholder:
That such order has been entered, together with a brief statement of the reasons for the entry of the order; and
That the Commission, upon receipt of a written request within 30 calendar days after the entry of the order, will, within 20 calendar days after receiving the request, order a hearing at a place to be designated by the Commission.
Suspension order. If no hearing is requested and none is ordered by the Commission, an order entered under paragraph (a) of this section shall become permanent on the 30th calendar day after its entry and shall remain in effect unless or until it is modified or vacated by the Commission. Where a hearing is requested or is ordered by the Commission, the Commission will, after notice of and opportunity for such hearing, either vacate the order or enter an order permanently suspending the exemption.
Permanent suspension. The Commission may, at any time after notice of and opportunity for hearing, enter an order permanently suspending the exemption for any reason upon which it could have entered a temporary suspension order under paragraph
(a) of this section. Any such order shall remain in effect until vacated by the Commission.
(e) Notice procedures. All notices required by this rule must be given by personal service, registered or certified mail to the addresses given by the issuer, any underwriter and any selling securityholder in the offering statement.
§ 230.259 Withdrawal or abandonment of offering statements.
Withdrawal. If none of the securities that are the subject of an offering statement has been sold and such offering statement is not the subject of a proceeding under
Rule 258 (§ 230.258), the offering statement may be withdrawn with the Commission’s consent. The application for withdrawal must state the reason the offering statement is to
be withdrawn and must be signed by an authorized representative of the issuer. Any withdrawn document will remain in the Commission’s files, as well as the related request for withdrawal.
Abandonment. When an offering statement has been on file with the Commission for nine months without amendment and has not become qualified, the Commission may, in its discretion, declare the offering statement abandoned. If the offering statement has been amended, the nine-month period shall be computed from the date of the latest amendment.
§ 230.260 Insignificant deviations from a term, condition or requirement of Regulation A.
Failure to comply. A failure to comply with a term, condition or requirement of Regulation A will not result in the loss of the exemption from the requirements of section 5 of the Securities Act for any offer or sale to a particular individual or entity, if the person relying on the exemption establishes that:
The failure to comply did not pertain to a term, condition or requirement directly intended to protect that particular individual or entity;
The failure to comply was insignificant with respect to the offering as a whole, provided that any failure to comply with Rule 251(a), (b), and (d)(1) and (3)
(§ 230.251(a), (b), and (d)(1) and (3)) shall be deemed to be significant to the offering as a whole; and
A good faith and reasonable attempt was made to comply with all applicable terms, conditions and requirements of Regulation A.
Action by Commission. A transaction made in reliance upon Regulation A must comply with all applicable terms, conditions and requirements of the regulation. Where
an exemption is established only through reliance upon paragraph (a) of this section, the failure to comply shall nonetheless be actionable by the Commission under section 20 of the Securities Act.
Suspension. This provision provides no relief or protection from a proceeding under Rule 258 (§ 230.258).
§ 230.261 Definitions.
As used in this Regulation A, all terms have the same meanings as in Rule 405
(§ 230.405), except that all references to registrant in those definitions shall refer to the issuer of the securities to be offered and sold under Regulation A. In addition, these terms have the following meanings:
Affiliated issuer. An affiliate (as defined in Rule 501 (§ 230.501)) of the issuer that is issuing securities in the same offering.
Business day. Any day except Saturdays, Sundays or United States federal holidays.
Eligible securities. Equity securities, debt securities, and securities convertible or exchangeable to equity interests, including any guarantees of such securities, but not including asset-backed securities as such term is defined in Item 1101(c) of Regulation AB.
Final order. A written directive or declaratory statement issued by a federal or state agency described in Rule 262(a)(3) (§ 230.262(a)(3)) under applicable statutory authority that provides for notice and an opportunity for hearing, which constitutes a final disposition or action by that federal or state agency.
Final offering circular. The more recent of: the current offering circular
contained in a qualified offering statement; and any offering circular filed pursuant to Rule 253(g) (§ 230.253(g)). If, however, the issuer is relying on Rule 253(b)
((§ 230.253(b)), the Final Offering Circular is the most recent of the offering circular filed pursuant to Rule 253(g)(1) or (3) (§ 230.253(g)(1) or (3)) and any subsequent offering circular filed pursuant to Rule 253(g) (§ 230.253(g)).
Offering statement. An offering statement prepared pursuant to Regulation A.
Preliminary offering circular. The offering circular described in Rule 254 (§ 230.254).
§ 230.262 Disqualification provisions.
Disqualification events. No exemption under this Regulation A shall be available for a sale of securities if the issuer; any predecessor of the issuer; any affiliated issuer; any director, executive officer, other officer participating in the offering, general partner or managing member of the issuer; any beneficial owner of 20% or more of the issuer’s outstanding voting equity securities, calculated on the basis of voting power; any promoter connected with the issuer in any capacity at the time of filing, any offer after qualification, or such sale; any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with such sale of securities; any general partner or managing member of any such solicitor; or any director, executive officer or other officer participating in the offering of any such solicitor or general partner or managing member of such solicitor:
Has been convicted, within ten years before the filing of the offering statement (or five years, in the case of issuers, their predecessors and affiliated issuers), of any felony or misdemeanor:
In connection with the purchase or sale of any security;
Involving the making of any false filing with the Commission; or
Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchasers of securities;
Is subject to any order, judgment or decree of any court of competent jurisdiction, entered within five years before the filing of the offering statement, that, at the time of such filing, restrains or enjoins such person from engaging or continuing to engage in any conduct or practice:
In connection with the purchase or sale of any security;
Involving the making of any false filing with the Commission; or
Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchasers of securities;
Is subject to a final order (as defined in Rule 261 (§ 230.261)) of a state securities commission (or an agency or officer of a state performing like functions); a state authority that supervises or examines banks, savings associations, or credit unions; a state insurance commission (or an agency or officer of a state performing like functions); an appropriate federal banking agency; the U.S. Commodity Futures Trading Commission; or the National Credit Union Administration that:
At the time of the filing of the offering statement, bars the person from:
Association with an entity regulated by such commission, authority, agency, or officer;
Engaging in the business of securities, insurance or banking; or