Are you still accredited?
Companies that have private investment documents drafted prior to passage of Dodd-Frank in 2010 should be very careful before reusing these documents. Section 513 of Dodd-Frank brought about an important change to the definition of “accredited investor” set out in the Regulation D exemptions to registration under the Securities Act of 1933.
The $1,000,000 net worth standard in Section 501 of Regulation D now excludes the value of the investor’s primary residence. (Sadly, in view of the housing market’s performance over the last few years, this change means less than it might.)
When it comes to fundraising, securities laws are always implicated. It’s always a good idea to have your lawyer review your documents, even if you think you have a well honed set from the prior round.
The good news is that with GoodCounsel, this legal review does not have to break the bank.
Categorised as: Fundraising