II 

115TH CONGRESS 

1ST SESSION S. 588 

To require the Securities and Exchange Commission to clarify what constitutes a general solicitation under the Federal securities laws, and 

for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 9, 2017 

Mr. MURPHY (for himself, Mr. THUNE, Mr. SCHATZ, Mr. TOOMEY, and Ms. 

HEITKAMP) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To require the Securities and Exchange Commission to clarify what constitutes a general solicitation under the Federal securities laws, and for other purposes. 

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. 

7 In this Act, the term ‘‘angel investor group’’ means 

8 a group that— 


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1 (1) is composed of accredited investors inter2 ested in investing in personal capital in early-stage 

3 companies; 

4 (2) holds regular meetings; 

5 (3) with respect to either the individual inves6 tors that constitute the group or the group as a 

7 whole, has defined processes and procedures for 

8 making investment decisions; and 

9 (4) is not associated with a broker, a dealer, or 

10 an investment adviser. 

11 SEC. 3. CLARIFICATION OF GENERAL SOLICITATION. 

12 (a) IN GENERAL.—Not later than 180 days after the 

13 date of enactment of this Act, the Securities and Ex14 change Commission shall amend sections 230.500 through 

15 230.508 of title 17, Code of Federal Regulations, so that 

16 the prohibition against general solicitation and general ad17 vertising under section 230.502(c) of title 17, Code of 

18 Federal Regulations, shall not apply with respect to a 

19 presentation or another form of communication that is 

20 made— 

21 (1) by or on behalf of an issuer; and 

22 (2) at an event— 

23 (A) that is sponsored by— 

24 (i) the United States; 

25 (ii) a State; 


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1 (iii) a political subdivision of a State; 

2 (iv) an agency or public instrumen3 tality of an entity described in clauses (i) 

4 through (iii); 

5 (v) a college, university, or other insti6 tution of higher learning; 

7 (vi) a nonprofit organization; 

8 (vii) an angel investor group; 

9 (viii) a venture forum, venture capital 

10 association, or trade association; or 

11 (ix) any other group or person that 

12 the Commission may determine, by rule; 

13 (B) where no advertising for the event ref14 erences any specific offering of securities by the 

15 issuer; 

16 (C) the sponsor of which does not— 

17 (i) make investment recommendations 

18 or provide investment advice to the 

19 attendees of the event; 

20 (ii) engage in an active role with re21 spect to investment negotiations between 

22 the issuer and any investors attending the 

23 event; 

24 (iii) charge attendees of the event any 

25 fees other than administrative fees; and 


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1 (iv) receive compensation with respect 

2 to the event that would require the sponsor 

3 to register as— 

4 (I) a broker or a dealer under the 

5 Securities Exchange Act of 1934 (15 

6 U.S.C. 78a et seq.); or 

7 (II) an investment adviser under 

8 the Investment Advisers Act of 1940 

9 (15 U.S.C. 80b–1 et seq.); and 

10 (D) where no specific information regard11 ing an offering of securities by the issuer is 

12 communicated or distributed by or on behalf of 

13 the issuer other than— 

14 (i) that the issuer is— 

15 (I) in the process of offering se16 curities; or 

17 (II) planning to offer securities; 

18 (ii) the type and amount of securities 

19 being offered; 

20 (iii) the amount of securities being of21 fered that have been subscribed for, as of 

22 the date of the event; and 

23 (iv) the intended use of any proceeds 

24 from the offering. 

25 (b) RULE OF CONSTRUCTION.—Subsection (a)— 


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1 (1) shall be construed to require the Securities 

2 and Exchange Commission to amend sections 

3 230.500 through 230.508 of title 17, Code of Fed4 eral Regulations, with respect to presentations and 

5 communications; and 

6 (2) may not be construed to require the Securi7 ties and Exchange Commission to amend sections 

8 230.500 through 230.508 of title 17, Code of Fed9 eral Regulations, with respect to purchases or sales. 

Æ 


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