Regulation A+ - The IPO Alternative
A. Most companies go public to raise money. It is much easier for a public company to locate capital than it is for a private company. Funds raised in going public transactions can be used for working capital, research and development, retiring existing indebtedness, acquiring other companies.
Regulation A+ EligibilityRegulation A+ is available to companies organized in and with their principal place of business in the United States or Canada. The exemption would not be available to companies that: Are already SEC reporting companies and certain investment companies; Have no specific business plan or purpose or have indicated that their business plan is to engage in a merger or acquisition with an unidentified company; Are seeking to offer and sell asset-backed securities or fractional undivided interests in oil, gas or other mineral rights; Have been subject to any order of the Commission under Exchange Act Section 12(j) entered within the past five years; Have not filed ongoing reports required by the rules during the preceding two years; and Are disqualified under the "bad actor" disqualification rules.
Application of State Blue Sky Laws to Regulation A+Regulation A+ provides for the preemption of state securities law registration statement requirements and qualification requirements for securities offered or sold to "qualified purchasers" in Tier 2 offerings. Tier 1 offerings will be subject to federal and state registration and qualification requirements, and issuers may take advantage of the coordinated review program developed by the North American Securities Administrators Association.