I 

116TH CONGRESS 

1ST SESSION H. R. 1909 

To require the Securities and Exchange Commission to revise rules relating 

to general solicitation or general advertising to allow for presentations 

or other communication made by or on behalf of an issuer at certain 

events, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 27, 2019 

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

which was referred to the Committee on Financial Services 

A BILL 

To require the Securities and Exchange Commission to revise 

rules relating to general solicitation or general advertising to allow for presentations or other communication 

made by or on behalf of an issuer at certain events, 

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 of 2019’’ or the ‘‘HALOS Act’’. 


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1 SEC. 2. CLARIFICATION OF GENERAL SOLICITATION. 

2 (a) DEFINITIONS.—For purposes of this Act and the 

3 revision of rules required under this Act: 

4 (1) ANGEL INVESTOR GROUP.—The term 

5 ‘‘angel investor group’’ means any group that— 

6 (A) is composed of accredited investors in7 terested in investing personal capital in early8 stage companies; 

9 (B) holds regular meetings and has defined 

10 processes and procedures for making invest11 ment decisions, either individually or among the 

12 membership of the group as a whole; and 

13 (C) is neither associated nor affiliated with 

14 brokers, dealers, or investment advisers. 

15 (2) ISSUER.—The term ‘‘issuer’’ means an 

16 issuer that is a business, is not in bankruptcy or re17 ceivership, is not an investment company, and is not 

18 a blank check, blind pool, or shell company. 

19 (b) 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 CFR 230.500 et seq.) to require that in carrying out 

23 the prohibition against general solicitation or general ad24 vertising contained in section 230.502(c) of title 17, Code 

25 of Federal Regulations, the prohibition shall not apply to 


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1 a presentation or other communication made by or on be2 half 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 reasonable administrative fees; 

6 (D) does not receive any compensation for 

7 making introductions between investors attend8 ing the event and issuers, or for investment ne9 gotiations between such parties; 

10 (E) makes readily available to attendees a 

11 disclosure not longer than one page in length, 

12 as prescribed by the Securities and Exchange 

13 Commission, describing the nature of the event 

14 and the risks of investing in the issuers pre15 senting at the event; and 

16 (F) does not receive any compensation 

17 with respect to such event that would require 

18 registration of the sponsor as a broker or a 

19 dealer under the Securities Exchange Act of 

20 1934, or as an investment advisor under the In21 vestment Advisers Act of 1940; and 

22 (4) where no specific information regarding an 

23 offering of securities by the issuer is communicated 

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

25 than— 


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1 (A) that the issuer is in the process of of2 fering securities or planning to offer securities; 

3 (B) the type and amount of securities 

4 being offered; 

5 (C) the amount of securities being offered 

6 that have already been subscribed for; and 

7 (D) the intended use of proceeds of the of8 fering. 

9 (c) RULE OF CONSTRUCTION.—Subsection (b) may 

10 only be construed as requiring the Securities and Ex11 change Commission to amend the requirements of Regula12 tion D with respect to presentations and communications, 

13 and not with respect to purchases or sales. 

14 (d) NO PRE-EXISTING SUBSTANTIVE RELATIONSHIP

15 BY REASON OF EVENT.—Attendance at an event de16 scribed under subsection (b) shall not qualify, by itself, 

17 as establishing a pre-existing substantive relationship be18 tween an issuer and a purchaser, for purposes of Rule 

19 506(b). 

Æ 


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