IB 

Union Calendar No. 389 

114TH CONGRESS 

2D SESSION H. R. 4498 

[Report No. 114–509] 

To clarify the definition of general solicitation under Federal securities law. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 9, 2016 

Mr. CHABOT (for himself, Ms. SINEMA, Mr. HURT of Virginia, and Mr. 

TAKAI) introduced the following bill; which was referred to the Committee 

on Financial Services 

APRIL 19, 2016 

Additional sponsors: Mr. CURBELO of Florida, Mrs. WAGNER, Mr. COSTELLO

of Pennsylvania, Mr. BARR, Mr. HULTGREN, Mr. DELANEY, Mr. SESSIONS, and Mr. POLIS

APRIL 19, 2016 

Committed to the Committee of the Whole House on the State of the Union 

and ordered to be printed 


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•HR 4498 RH

A BILL 

To clarify the definition of general solicitation under Federal 

securities law. 


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•HR 4498 RH

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Helping Angels Lead 

5 Our Startups Act’’ or the ‘‘HALOS Act’’. 

6 SEC. 2. DEFINITION OF ANGEL INVESTOR GROUP. 

7 As used in this Act, the term ‘‘angel investor group’’ 

8 means any group that— 

9 (1) is composed of accredited investors inter10 ested in investing personal capital in early-stage 

11 companies; 

12 (2) holds regular meetings and has defined 

13 processes and procedures for making investment de14 cisions, either individually or among the membership 

15 of the group as a whole; and 

16 (3) is neither associated nor affiliated with bro17 kers, dealers, or investment advisers. 

18 SEC. 3. CLARIFICATION OF GENERAL SOLICITATION. 

19 (a) IN GENERAL.—Not later than 6 months after the 

20 date of enactment of this Act, the Securities and Ex21 change Commission shall revise Regulation D of its rules 

22 (17 C.F.R. 230.500 et seq.) to require that in carrying 

23 out the prohibition against general solicitation or general 

24 advertising contained in section 230.502(c) of title 17, 

25 Code of Federal Regulations, the prohibition shall not 


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•HR 4498 RH

1 apply to a presentation or other communication made by 

2 or on behalf of an issuer which is made at an event— 

3 (1) sponsored by— 

4 (A) the United States or any territory 

5 thereof, by the District of Columbia, by any 

6 State, by a political subdivision of any State or 

7 territory, or by any agency or public instrumen8 tality of any of the foregoing; 

9 (B) a college, university, or other institu10 tion of higher education; 

11 (C) a nonprofit organization; 

12 (D) an angel investor group; 

13 (E) a venture forum, venture capital asso14 ciation, or trade association; or 

15 (F) any other group, person or entity as 

16 the Securities and Exchange Commission may 

17 determine by rule; 

18 (2) where any advertising for the event does not 

19 reference any specific offering of securities by the 

20 issuer; 

21 (3) the sponsor of which— 

22 (A) does not make investment rec23 ommendations or provide investment advice to 

24 event attendees; 


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1 (B) does not engage in an active role in 

2 any investment negotiations between the issuer 

3 and investors attending the event; 

4 (C) does not charge event attendees any 

5 fees other than administrative fees; and 

6 (D) does not receive any compensation 

7 with respect to such event that would require 

8 registration of the sponsor as a broker or a 

9 dealer under the Securities Exchange Act of 

10 1934, or as an investment advisor under the In11 vestment Advisers Act of 1940; and 

12 (4) where no specific information regarding an 

13 offering of securities by the issuer is communicated 

14 or distributed by or on behalf of the issuer, other 

15 than— 

16 (A) that the issuer is in the process of of17 fering securities or planning to offer securities; 

18 (B) the type and amount of securities 

19 being offered; 

20 (C) the amount of securities being offered 

21 that have already been subscribed for; and 

22 (D) the intended use of proceeds of the of23 fering. 

24 (b) RULE OF CONSTRUCTION.—Subsection (a) may 

25 only be construed as requiring the Securities and ExVerDate Sep 11 2014 20:18 Apr 19, 2016 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4498.RH H4498

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1 change Commission to amend the requirements of Regula2 tion D with respect to presentations and communications, 

3 and not with respect to purchases or sales. 


sradovich on DSK3TPTVN1PROD with BILLS

sradovich on DSK3TPTVN1PROD with BILLS
Union Calendar No. 389 

114TH CONGRESS 

2D SESSION H. R. 4498 

[Report No. 114–509] 

A BILL 

To clarify the definition of general solicitation 

under Federal securities law. 

APRIL 19, 2016 

Committed to the Committee of the Whole House on the 

State of the Union and ordered to be printed 


sradovich on DSK3TPTVN1PROD with BILLS