I 

115TH CONGRESS 

1ST SESSION H. R. 79 

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

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 3, 2017 

Mr. CHABOT (for himself and Ms. SINEMA) introduced the following bill; 

which was referred to the Committee on Financial Services 

A BILL 

To clarify the definition of general solicitation under Federal 

securities law. 

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; 


SSpencer on DSK4SPTVN1PROD with BILLS
2 

•HR 79 IH

1 (2) holds regular meetings and has defined 

2 processes and procedures for making investment de3 cisions, either individually or among the membership 

4 of the group as a whole; and 

5 (3) is neither associated nor affiliated with bro6 kers, dealers, or investment advisers. 

7 SEC. 3. CLARIFICATION OF GENERAL SOLICITATION. 

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

9 date of enactment of this Act, the Securities and Ex10 change Commission shall revise Regulation D of its rules 

11 (17 CFR 230.500 et seq.) to require that in carrying out 

12 the prohibition against general solicitation or general ad13 vertising contained in section 230.502(c) of title 17, Code 

14 of Federal Regulations, the prohibition shall not apply to 

15 a presentation or other communication made by or on be16 half of an issuer which is made at an event— 

17 (1) sponsored by— 

18 (A) the United States or any territory 

19 thereof, by the District of Columbia, by any 

20 State, by a political subdivision of any State or 

21 territory, or by any agency or public instrumen22 tality of any of the foregoing; 

23 (B) a college, university, or other institu24 tion of higher education; 

25 (C) a nonprofit organization; 


SSpencer on DSK4SPTVN1PROD with BILLS
3 

•HR 79 IH

1 (D) an angel investor group; 

2 (E) a venture forum, venture capital asso3 ciation, or trade association; or 

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

5 the Securities and Exchange Commission may 

6 determine by rule; 

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

8 reference any specific offering of securities by the 

9 issuer; 

10 (3) the sponsor of which— 

11 (A) does not make investment rec12 ommendations or provide investment advice to 

13 event attendees; 

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

15 any investment negotiations between the issuer 

16 and investors attending the event; 

17 (C) does not charge event attendees any 

18 fees other than administrative fees; and 

19 (D) does not receive any compensation 

20 with respect to such event that would require 

21 registration of the sponsor as a broker or a 

22 dealer under the Securities Exchange Act of 

23 1934, or as an investment advisor under the In24 vestment Advisers Act of 1940; and 


SSpencer on DSK4SPTVN1PROD with BILLS
4 

•HR 79 IH

1 (4) where no specific information regarding an 

2 offering of securities by the issuer is communicated 

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

4 than— 

5 (A) that the issuer is in the process of of6 fering securities or planning to offer securities; 

7 (B) the type and amount of securities 

8 being offered; 

9 (C) the amount of securities being offered 

10 that have already been subscribed for; and 

11 (D) the intended use of proceeds of the of12 fering. 

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

14 only be construed as requiring the Securities and Ex15 change Commission to amend the requirements of Regula16 tion D with respect to presentations and communications, 

17 and not with respect to purchases or sales. 

Æ 


SSpencer on DSK4SPTVN1PROD with BILLS