IIB 

114TH CONGRESS 

1ST SESSION H. R. 1839 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 7, 2015 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

AN ACT 

To amend the Securities Act of 1933 to exempt certain 

transactions involving purchases by accredited investors, 

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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Reforming Access for 

3 Investments in Startup Enterprises Act of 2015’’ or the 

4 ‘‘RAISE Act of 2015’’. 

5 SEC. 2. EXEMPTED TRANSACTIONS. 

6 (a) EXEMPTED TRANSACTIONS.—Section 4 of the Se7 curities Act of 1933 (15 U.S.C. 77d) is amended— 

8 (1) in subsection (a), by adding at the end the 

9 following new paragraph: 

10 ‘‘(7) transactions meeting the requirements of 

11 subsection (d).’’; 

12 (2) by redesignating the second subsection (b) 

13 (relating to securities offered and sold in compliance 

14 with Rule 506 of Regulation D) as subsection (c); 

15 and 

16 (3) by adding at the end the following: 

17 ‘‘(d) CERTAIN ACCREDITED INVESTOR TRANS18 ACTIONS.—The transactions referred to in subsection 

19 (a)(7) are transactions meeting the following require20 ments: 

21 ‘‘(1) ACCREDITED INVESTOR REQUIREMENT.— 

22 Each purchaser is an accredited investor, as that 

23 term is defined in section 230.501(a) of title 17, 

24 Code of Federal Regulations (or any successor regu25 lation). 


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1 ‘‘(2) PROHIBITION ON GENERAL SOLICITATION

2 OR ADVERTISING.—Neither the seller, nor any per3 son acting on the seller’s behalf, offers or sells secu4 rities by any form of general solicitation or general 

5 advertising. 

6 ‘‘(3) INFORMATION REQUIREMENT.—In the 

7 case of a transaction involving the securities of an 

8 issuer that is neither subject to section 13 or 15(d) 

9 of the Securities Exchange Act of 1934 (15 U.S.C. 

10 78m; 78o(d)), nor exempt from reporting pursuant 

11 to section 240.12g3–2(b) of title 17, Code of Federal 

12 Regulations, nor a foreign government (as defined in 

13 section 230.405 of title 17, Code of Federal Regula14 tions) eligible to register securities under Schedule 

15 B, the seller and a prospective purchaser designated 

16 by the seller obtain from the issuer, upon request of 

17 the seller, and the seller in all cases makes available 

18 to a prospective purchaser, the following information 

19 (which shall be reasonably current in relation to the 

20 date of resale under this section): 

21 ‘‘(A) The exact name of the issuer and the 

22 issuer’s predecessor (if any). 

23 ‘‘(B) The address of the issuer’s principal 

24 executive offices. 


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1 ‘‘(C) The exact title and class of the secu2 rity. 

3 ‘‘(D) The par or stated value of the secu4 rity. 

5 ‘‘(E) The number of shares or total 

6 amount of the securities outstanding as of the 

7 end of the issuer’s most recent fiscal year. 

8 ‘‘(F) The name and address of the transfer 

9 agent, corporate secretary, or other person re10 sponsible for transferring shares and stock cer11 tificates. 

12 ‘‘(G) A statement of the nature of the 

13 business of the issuer and the products and 

14 services it offers, which shall be presumed rea15 sonably current if the statement is as of 12 

16 months before the transaction date. 

17 ‘‘(H) The names of the officers and direc18 tors of the issuer. 

19 ‘‘(I) The names of any persons registered 

20 as a broker, dealer, or agent that shall be paid 

21 or given, directly or indirectly, any commission 

22 or remuneration for such person’s participation 

23 in the offer or sale of the securities. 


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1 ‘‘(J) The issuer’s most recent balance 

2 sheet and profit and loss statement and similar 

3 financial statements, which shall— 

4 ‘‘(i) be for such part of the 2 pre5 ceding fiscal years as the issuer has been 

6 in operation; 

7 ‘‘(ii) be prepared in accordance with 

8 generally accepted accounting principles or, 

9 in the case of a foreign private issuer, be 

10 prepared in accordance with generally ac11 cepted accounting principles or the Inter12 national Financial Reporting Standards 

13 issued by the International Accounting 

14 Standards Board; 

15 ‘‘(iii) be presumed reasonably current 

16 if— 

17 ‘‘(I) with respect to the balance 

18 sheet, the balance sheet is as of a date 

19 less than 16 months before the trans20 action date; and 

21 ‘‘(II) with respect to the profit 

22 and loss statement, such statement is 

23 for the 12 months preceding the date 

24 of the issuer’s balance sheet; and 


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1 ‘‘(iv) if the balance sheet is not as of 

2 a date less than 6 months before the trans3 action date, be accompanied by additional 

4 statements of profit and loss for the period 

5 from the date of such balance sheet to a 

6 date less than 6 months before the trans7 action date. 

8 ‘‘(K) To the extent that the seller is a con9 trol person with respect to the issuer, a brief 

10 statement regarding the nature of the affili11 ation, and a statement certified by such seller 

12 that they have no reasonable grounds to believe 

13 that the issuer is in violation of the securities 

14 laws or regulations. 

15 ‘‘(4) ISSUERS DISQUALIFIED.—The transaction 

16 is not for the sale of a security where the seller is 

17 an issuer or a subsidiary, either directly or indi18 rectly, of the issuer. 

19 ‘‘(5) BAD ACTOR PROHIBITION.—Neither the 

20 seller, nor any person that has been or will be paid 

21 (directly or indirectly) remuneration or a commission 

22 for their participation in the offer or sale of the se23 curities, including solicitation of purchasers for the 

24 seller is subject to an event that would disqualify an 

25 issuer or other covered person under Rule 506(d)(1) 


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1 of Regulation D (17 CFR 230.506(d)(1)) or is sub2 ject to a statutory disqualification described under 

3 section 3(a)(39) of the Securities Exchange Act of 

4 1934. 

5 ‘‘(6) BUSINESS REQUIREMENT.—The issuer is 

6 engaged in business, is not in the organizational 

7 stage or in bankruptcy or receivership, and is not a 

8 blank check, blind pool, or shell company that has 

9 no specific business plan or purpose or has indicated 

10 that the issuer’s primary business plan is to engage 

11 in a merger or combination of the business with, or 

12 an acquisition of, an unidentified person. 

13 ‘‘(7) UNDERWRITER PROHIBITION.—The trans14 action is not with respect to a security that con15 stitutes the whole or part of an unsold allotment to, 

16 or a subscription or participation by, a broker or 

17 dealer as an underwriter of the security or a redis18 tribution. 

19 ‘‘(8) OUTSTANDING CLASS REQUIREMENT.— 

20 The transaction is with respect to a security of a 

21 class that has been authorized and outstanding for 

22 at least 90 days prior to the date of the transaction. 

23 ‘‘(e) ADDITIONAL REQUIREMENTS.— 

24 ‘‘(1) IN GENERAL.—With respect to an exempt25 ed transaction described under subsection (a)(7): 


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1 ‘‘(A) Securities acquired in such trans2 action shall be deemed to have been acquired in 

3 a transaction not involving any public offering. 

4 ‘‘(B) Such transaction shall be deemed not 

5 to be a distribution for purposes of section 

6 2(a)(11). 

7 ‘‘(C) Securities involved in such trans8 action shall be deemed to be restricted securi9 ties within the meaning of Rule 144 (17 CFR 

10 230.144). 

11 ‘‘(2) RULE OF CONSTRUCTION.—The exemption 

12 provided by subsection (a)(7) shall not be the exclu13 sive means for establishing an exemption from the 

14 registration requirements of section 5.’’. 

15 (b) EXEMPTION IN CONNECTION WITH CERTAIN EX16 EMPT OFFERINGS.—Section 18(b)(4) of the Securities Act 

17 of 1933 (15 U.S.C. 77r(b)(4)) is amended— 

18 (1) by redesignating the second subparagraph 

19 (D) and subparagraph (E) as subparagraphs (E) 

20 and (F), respectively; 

21 (2) in subparagraph (E), as so redesignated, by 

22 striking ‘‘; or’’ and inserting a semicolon; 

23 (3) in subparagraph (F), as so redesignated, by 

24 striking the period and inserting ‘‘; or’’; and 


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1 (4) by adding at the end the following new sub2 paragraph: 

3 ‘‘(G) section 4(a)(7).’’. 

Passed the House of Representatives October 6, 

2015. 

Attest: KAREN L. HAAS, 

Clerk. 


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