The Matrix: Crowdfunding and other JOBS Act Exemptions

Below is a matrix depicting key provisions of SEC regulations promulgated or proposed pursuant to Titles
II, III and IV of the Jumpstart Our Business Startups Act of 2012.

Title II (Reg D Title III (Reg. Title IV

506(c)) CF) (Reg. A+)

Tier 1 Tier 2

Offering Cap None $1,070,000 $20 million $50 million

Type of Securities No limitations No limitations Equity, debt, or debt convertible
into equity (or guarantees thereof)

Transferability Restricted Restricted Freely transferable

securities subject securities for one
to Rule 144 year
holding periods
(one year for non-
affiliates)
State Preemption State preemption State preemption Required to State
subject to state comply with all preemption
notice filings applicable
state securities
laws

Investor Accredited General public General public

Qualification Investors only
Investor Limits No limitation Greater of $2k or No limitation 10% of annual
5% of annual income or net
income or net worth
worth if < $100k;
10% of annual
income or net
worth if $100k or
greater; capped at
$100k
Section 12(g) Up to 500 general No requirement if N/A
Reporting Cap public and 2,000 engage transfer
accredited agent and have
investors before less than $25M in
SEC reporting assets. Otherwise,
required up to 500 general
public and 2,000
accredited
investors before
SEC reporting
required
Sales Disclosure No requisite Form C Form 1-A Offering Circular
offering document
subject to anti-
fraud rules)

Form D

Ongoing None Form C-AR Form 1-Z Annual, semi-

Disclosure (annually) within 30 days annual and
after current
termination or reporting
completion of requirements
offering
Financial No requisite GAAP financial GAAP Audited GAAP
Statements financial statements for past financials for financial
statements (subject two years; tax past two years statements for
to anti-fraud rules) returns if raising (only need to be past two years
$100k or <; audited if
reviewed if raising already
> $100k up to available)
$500k; audited if
raising > $500k;
but exemption for
first time users
only need
reviewed
financials

SEC Approval None required None required SEC must affirmatively qualify
offering prior to any sales
Testing the Waters Not applicable Not allowed Solicitation of interests permitted
prior to offering as long as
solicitation materials filed with
the SEC at time of sale

Bad Actor Bad actor Bad actor Bad actor participation

Disqualification participation participation disqualifies offering
disqualifies disqualifies
offering offering
Accredited Must take Not applicable Not applicable
Investor reasonable steps
Verification to ensure investor
is accredited

Electronic Filing Only Form D Form C and Form 1-A Form 1-A and
on EDGAR required after ongoing ongoing
initial close disclosure disclosure
requirements requirements
Portal BD Must be registered Can be registered Compensated solicitors must be
Registration broker-dealer in funding portal or registered broker-dealers to
order to receive broker-dealer in receive transaction based
transaction based order to receive compensation
compensation transaction based
compensation

12(a)(2) Liability Private civil fraud Private civil fraud Private civil fraud liability
liability liability
10b-5 Liability SEC/private anti- SEC/private anti- SEC/private anti-fraud liability
fraud liability fraud liability