For an offering under Rule 506(c) of Regulation D, the main filing requirements are:
1. Form D with the SEC
- Mandatory filing: Issuers must file a Form D electronically with the SEC through EDGAR.
- Timing: Within 15 calendar days after the first sale of securities in the offering.
- Contents:
- Basic information about the issuer (name, address, officers, directors).
- Type of securities offered.
- Total offering amount and amount sold to date.
- Identities of related persons (executive officers, promoters, etc.).
- Details of fees/commissions paid to placement agents or brokers.
2. State “Blue Sky” Notice Filings
- Although federal law (Reg D) preempts most state substantive regulation, states may require notice filings and fees.
- Typically, issuers must file a copy of Form D (or a state equivalent form) with each state where securities are sold, along with a filing fee.
- Deadlines and requirements vary by state.
3. Verification of Accredited Investor Status
- Unlike Rule 506(b), under Rule 506(c) issuers must take “reasonable steps” to verify that all purchasers are accredited investors.
- This is not a “filing,” but it is a compliance obligation that must be documented in case of SEC inquiry.
- Acceptable verification methods include reviewing IRS forms, W-2s, brokerage/account statements, or obtaining a written confirmation from a licensed attorney, CPA, or broker-dealer.
4. Amendments to Form D
- If information in the Form D changes materially (e.g., offering amount, officers, types of investors), issuers must file an amended Form D.
- At a minimum, an annual amendment is required if the offering is ongoing for more than one year.
Mark J. Astarita, Esq. is a securities lawyer who represents investors, financial professionals and firms in litigation, arbitration and regulatory matters across the country. He is a partner in the national securities law firm of Sallah Astarita & Cox, LLC and can be reached by email at mja@sallahlaw.com or by phone at 212-509-6544.
Follow us on Twitter, Facebook and The Securities Law Blog .
Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.
He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.
