In the second update to the Securities and Exchange Commission’s Division of Corporation Finance’s Compliance and Disclosure Interpretations in less than a week, on February 17, 2025, the Staff turned its attention to exempt offerings, focusing on Regulation A (“Reg A”) and Regulation Crowdfunding (“Reg CF”). All the guidance below, except where otherwise noted, is new, although it is consistent with positions the Staff has taken with respect to such offerings in the past, and, with respect to the Reg A guidance, is consistent with Staff guidance generally applicable to registered offerings. Unless otherwise noted, all CDIs are included in the Securities Act Rules CDIs.
| CDI Reference | Guidance |
| CDI 182.05 (withdrawn) | The CDI addressed Reg A eligibility for voluntary filers and was withdrawn because, as of January 2019, Exchange Act reporting companies are eligible to use Reg A. |
| CDI 182.24 | Extended the Division’s enhanced accommodations with respect to draft registration statements to Reg A issuers, clarifying that Reg A issuers may submit draft offering statements for non-public Staff review regardless of whether the issuer has previously sold securities under Reg A or pursuant to the Securities Act. |
| CDI 182.25 | A Reg A issuer may convert a qualified Tier 1 offering to a Tier 2 offering by post-qualification amendment (“PQA”). |
| CDI 182.26 | When an Exchange Act reporting company is filing or has filed a Form 1-A and has available interim financial statements or other information from its Exchange Act reports for a period more recent than specifically required in Form 1-A, the issuer should include in the Form 1-A such information necessary to “to make the required statements therein, in light of the circumstances under which they are being made, not misleading.” An amendment to a qualified Form 1-A is necessary where the interim financial statements or other information in the issuer’s Exchange Act reports “individually or in the aggregate, represent a fundamental change in the information set forth in the offering statement.” |
| CDI 182.27 | A Reg A issuer does not need to continually update the amount of offered securities on the offering circular cover page when filing a PQA to account for the actual amount of securities it can sell pursuant to Rule 251(a), although the issuer can do so voluntarily, and should do so if its adding a new class of securities or additional securities to a previously-qualified Form 1-A. |
| CDI 182.28 | Depending on the timing of an advertisement, a Reg A issuer can sometimes advertise the offering on TV or radio, or online: Before filing a Form 1-A: Yes, so long as the advertisement complies with the conditions of Rule 255(b)(1)–(3), which require certain statements to be included in the communication.After filing a Form 1-A but before qualification: Yes, so long as the advertisement complies with Rule 251(d)(1)(ii)(B) and (C), Rule 254, and Rule 255(b)(1)–(4). In essence, because TV, radio, or online advertisements would be considered “written” offers, they must comply with Reg A’s communications rules.After qualification of Form 1-A: No TV or radio advertising is permitted because post-qualification offers must be accompanied with or preceded by the most recent offering circular, which is not possible in a TV or radio format. An issuer can advertise online if offers can be accompanied with or preceded by the most recent offering circular. |
| CDI 182.29 | “Testing the waters” materials for a Reg A offering need not be filed if they are substantively the same as previously filed testing-the-waters materials. |
| CDI 182.30 | If the securities to be issued in a Reg A offering are convertible, exercisable, or exchangeable within one year of qualification or at the issuer’s discretion, the underlying securities must also be qualified at the time the overlying securities are qualified and any consideration to be received by the issuer initially and upon conversion, exercise, or exchange (for example, any warrant exercise price) should be included in the “aggregate offering price.” |
| CDI 182.31 | Reg A issuers cannot ask investors to put money into escrow before the Form 1-A for an offering is qualified, even if investors retain discretion as to whether to invest after qualification. |
| CDI 182.32 | In an ongoing Reg A offering, offers and sales must sometimes be suspended during the pendency of a PQA: Offers and sales both suspended when a PQA is filed to comply with Rule 252(f)(2)(i) (which requires annual updates to the financial statements) and the financial statements are stale.Sales, but not offers, must be suspended during the pendency of a PQA filed to comply with Rule 252(f)(2)(ii) (which requires amendments to reflect fundamental changes in the information in the offering statement). |
| CDI 182.33 | Issuers cannot attach exhibits to Reg A offering circular supplements. However, issuers can file exhibits with Form 1-U and exhibits-only PQAs, providing a path for issuers to file such exhibits on EDGAR. |
| Reg CF CDI 100.03 | An issuer can move a Reg CF offering between intermediary platforms prior to making any sales in the offering. The issuer must cancel the offering on the initial platform and make sure its offering materials are removed, and then file a new Form C for the offering on the new platform. |
| Reg CF CDI 100.04 | Former Exchange Act reporting companies can rely on Reg CF if they no longer have active Exchange Act reporting obligations because these obligations were terminated or suspended. |
| Reg CF CDI 100.05 | Reg CF issuers should use a rolling 12-month calculation from the date of each closing to calculate the maximum aggregate amount of securities the issuer can offer under Rule 100(a)(1). |
| Reg CF CDI 100.06 | The “annual period” used to calculate annual income for purposes of Reg CF Rule 100(a)(2)’s individual investment limit is a calendar year. |
| Reg CF CDI 201.03 | When (i) at least one “rolling closing” in an ongoing Reg CF offering has occurred and (ii) the offering is still ongoing more than 120 days after the issuer’s fiscal year end, the issuer must file a Form C/A with updated financial statements and an annual report on Form C-AR, along with progress updates under Rule 203(a)(3). |
Find the new CDIs here.