Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015

Bill: 114-hr-1839
Sponsor: full_name: Rep. McHenry, Patrick T. [R-NC-10]
Introduced: 2015-04-16
Policy area: Finance and Financial Sector
Subjects: Financial services and investments

Securities
Latest action: action_date: 2015-10-07
text: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2015-04-16
action_desc: Introduced in House
text: <p> <b> Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015</b></p> <p> Amends the Securities Act of 1933 to exempt from prohibitions relating to interstate commerce and the mails any transaction where: (1) each purchaser is an accredited investor; and (2) if the securities are offered by means of any general solicitation or general advertising, all such sales are made through a platform available only to accredited investors.</p> <p>Denies such exemption to transactions where the seller is: (1) either an issuer, its subsidiaries or parent; (2) a dealer; or (3) an underwriter acting on behalf of the issuer, its subsidiaries, or parent, which receives compensation from the issuer with respect to such sale.</p>

action_date: 2015-10-06
action_desc: Passed House amended
text: <p><b> Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015</b></p> <p> (Sec. 2) The Securities Act of 1933 is amended to exempt from security registration requirements, and related prohibitions against using interstate commerce and the mails for the sale or delivery of securities after sale, any transaction where:</p> <ul> <li>each purchaser is an accredited investor;</li> <li>neither the seller, nor any person acting on the seller's behalf, offers or sells securities by general solicitation or advertising;</li> <li>the seller and prospective purchaser obtain from an issuer meeting certain criteria reasonably current specified information;</li> <li>the transaction is not for the sale of a security whose seller is neither an issuer nor a subsidiary of the issuer;</li> <li>neither the seller, nor any person receiving remuneration for participating in the offer or sale of the securities, is subject to certain legal disqualification (bad actor);</li> <li>the issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not a blank check, blind pool, or shell company with no specific business plan or purpose or has indicated that the issuer's primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person;</li> <li>the transaction does not involve a security that constitutes the whole or part of an unsold allotment to, or a subscription or participation by, a broker or dealer as an underwriter of the security or a redistribution; and</li> <li>the transaction does involve a security of a class authorized and outstanding for at least 90 days before the transaction. </li> </ul> <p>Securities acquired in such exempt transactions shall be deemed to: (1) have been acquired in a transaction not involving any public offering, (2) not be a distribution involving an underwriter, and (2) be restricted securities not subject to certain transaction requirements.</p>  <p>All transactions under this Act shall be exempt from state regulation of securities offerings.</p>

tv_txt: I 114th CONGRESS 1st Session H. R. 1839 IN THE HOUSE OF REPRESENTATIVES April 16, 2015 Mr. McHenry introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Securities Act of 1933 to exempt certain transactions involving purchases by accredited investors, and for other purposes.

1. Short title This Act may be cited as the Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015 . 2. Exempted transactions (a) Exempted transactions Section 4 of the Securities Act of 1933 ( 15 U.S.C. 77d ) is amended— (1) in subsection (a), by adding at the end the following new paragraph: (7) transactions meeting the requirements of subsection (d). ; (2) by redesignating the second subsection (b) (relating to securities offered and sold in compliance with Rule 506 of Regulation D) as subsection (c); and (3) by adding at the end the following: (d) (1) The transactions referred to in subsection (a)(7) are transactions where— (A) each purchaser is an accredited investor, as that term is defined in section 230.501(a) of title 17, Code of Federal Regulations (or any successor thereto); and (B) if any securities sold in reliance on subsection (a)(7) are offered by means of any general solicitation or general advertising, all such sales are made through a platform available only to accredited investors. (2) Securities sold in reliance on subsection (a)(7) shall be deemed to have been acquired in a transaction not involving any public offering. (3) The exemption provided by this subsection shall not be available for a transaction where the seller is— (A) an issuer, its subsidiaries or parent; (B) an underwriter acting on behalf of the issuer, its subsidiaries or parent, which receives compensation from the issuer with respect to such sale; or (C) a dealer. (4) A transaction meeting the requirements of this subsection shall be deemed not to be a distribution for purposes of section 2(a)(11). . (b) Exemption in connection with certain exempt offerings Section 18(b)(4) of the Securities Act of 1933 ( 15 U.S.C. 77r(b)(4) ) is amended— (1) by redesignating the second subparagraph (D) and subparagraph (E) as subparagraphs (E) and (F), respectively; (2) in subparagraph (E), as so redesignated, by striking ; or and inserting a semicolon; (3) in subparagraph (F), as so redesignated, by striking the period and inserting ; or ; and (4) by adding at the end the following new subparagraph: (G) section 4(a)(7). .

tv_txt: 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. Short title This Act may be cited as the Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015 . 2. Exempted transactions (a) Exempted transactions Section 4 of the Securities Act of 1933 ( 15 U.S.C. 77d ) is amended— (1) in subsection (a), by adding at the end the following new paragraph: (7) transactions meeting the requirements of subsection (d). ; (2) by redesignating the second subsection (b) (relating to securities offered and sold in compliance with Rule 506 of Regulation D) as subsection (c); and (3) by adding at the end the following: (d) Certain accredited investor transactions The transactions referred to in subsection (a)(7) are transactions meeting the following requirements: (1) Accredited investor requirement Each purchaser is an accredited investor, as that term is defined in section 230.501(a) of title 17, Code of Federal Regulations (or any successor regulation). (2) Prohibition on general solicitation or advertising Neither the seller, nor any person acting on the seller’s behalf, offers or sells securities by any form of general solicitation or general advertising. (3) Information requirement In the case of a transaction involving the securities of an issuer that is neither subject to section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m ; 78o(d)), nor exempt from reporting pursuant to section 240.12g3–2(b) of title 17, Code of Federal Regulations, nor a foreign government (as defined in section 230.405 of title 17, Code of Federal Regulations) eligible to register securities under Schedule B, the seller and a prospective purchaser designated by the seller obtain from the issuer, upon request of the seller, and the seller in all cases makes available to a prospective purchaser, the following information (which shall be reasonably current in relation to the date of resale under this section): (A) The exact name of the issuer and the issuer’s predecessor (if any). (B) The address of the issuer’s principal executive offices. (C) The exact title and class of the security. (D) The par or stated value of the security. (E) The number of shares or total amount of the securities outstanding as of the end of the issuer’s most recent fiscal year. (F) The name and address of the transfer agent, corporate secretary, or other person responsible for transferring shares and stock certificates. (G) A statement of the nature of the business of the issuer and the products and services it offers, which shall be presumed reasonably current if the statement is as of 12 months before the transaction date. (H) The names of the officers and directors of the issuer. (I) The names of any persons registered as a broker, dealer, or agent that shall be paid or given, directly or indirectly, any commission or remuneration for such person's participation in the offer or sale of the securities. (J) The issuer’s most recent balance sheet and profit and loss statement and similar financial statements, which shall— (i) be for such part of the 2 preceding fiscal years as the issuer has been in operation; (ii) be prepared in accordance with generally accepted accounting principles or, in the case of a foreign private issuer, be prepared in accordance with generally accepted accounting principles or the International Financial Reporting Standards issued by the International Accounting Standards Board; (iii) be presumed reasonably current if— (I) with respect to the balance sheet, the balance sheet is as of a date less than 16 months before the transaction date; and (II) with respect to the profit and loss statement, such statement is for the 12 months preceding the date of the issuer’s balance sheet; and (iv) if the balance sheet is not as of a date less than 6 months before the transaction date, be accompanied by additional statements of profit and loss for the period from the date of such balance sheet to a date less than 6 months before the transaction date. (K) To the extent that the seller is a control person with respect to the issuer, a brief statement regarding the nature of the affiliation, and a statement certified by such seller that they have no reasonable grounds to believe that the issuer is in violation of the securities laws or regulations. (4) Issuers disqualified The transaction is not for the sale of a security where the seller is an issuer or a subsidiary, either directly or indirectly, of the issuer. (5) Bad actor prohibition Neither the seller, nor any person that has been or will be paid (directly or indirectly) remuneration or a commission for their participation in the offer or sale of the securities, including solicitation of purchasers for the seller is subject to an event that would disqualify an issuer or other covered person under Rule 506(d)(1) of Regulation D (17 CFR 230.506(d)(1)) or is subject to a statutory disqualification described under section 3(a)(39) of the Securities Exchange Act of 1934. (6) Business requirement The issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that the issuer’s primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person. (7) Underwriter prohibition The transaction is not with respect to a security that constitutes the whole or part of an unsold allotment to, or a subscription or participation by, a broker or dealer as an underwriter of the security or a redistribution. (8) Outstanding class requirement The transaction is with respect to a security of a class that has been authorized and outstanding for at least 90 days prior to the date of the transaction. (e) Additional requirements (1) In general With respect to an exempted transaction described under subsection (a)(7): (A) Securities acquired in such transaction shall be deemed to have been acquired in a transaction not involving any public offering. (B) Such transaction shall be deemed not to be a distribution for purposes of section 2(a)(11). (C) Securities involved in such transaction shall be deemed to be restricted securities within the meaning of Rule 144 (17 CFR 230.144). (2) Rule of construction The exemption provided by subsection (a)(7) shall not be the exclusive means for establishing an exemption from the registration requirements of section 5. . (b) Exemption in connection with certain exempt offerings Section 18(b)(4) of the Securities Act of 1933 ( 15 U.S.C. 77r(b)(4) ) is amended— (1) by redesignating the second subparagraph (D) and subparagraph (E) as subparagraphs (E) and (F), respectively; (2) in subparagraph (E), as so redesignated, by striking ; or and inserting a semicolon; (3) in subparagraph (F), as so redesignated, by striking the period and inserting ; or ; and (4) by adding at the end the following new subparagraph: (G) section 4(a)(7). .

Passed the House of Representatives October 6, 2015. Karen L. Haas, Clerk

tv_txt: I 114th CONGRESS 1st Session H. R. 1839 IN THE HOUSE OF REPRESENTATIVES AN ACT To amend the Securities Act of 1933 to exempt certain transactions involving purchases by accredited investors, and for other purposes.

1. Short title This Act may be cited as the Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015 . 2. Exempted transactions (a) Exempted transactions Section 4 of the Securities Act of 1933 ( 15 U.S.C. 77d ) is amended— (1) in subsection (a), by adding at the end the following new paragraph: (7) transactions meeting the requirements of subsection (d). ; (2) by redesignating the second subsection (b) (relating to securities offered and sold in compliance with Rule 506 of Regulation D) as subsection (c); and (3) by adding at the end the following: (d) Certain accredited investor transactions The transactions referred to in subsection (a)(7) are transactions meeting the following requirements: (1) Accredited investor requirement Each purchaser is an accredited investor, as that term is defined in section 230.501(a) of title 17, Code of Federal Regulations (or any successor regulation). (2) Prohibition on general solicitation or advertising Neither the seller, nor any person acting on the seller’s behalf, offers or sells securities by any form of general solicitation or general advertising. (3) Information requirement In the case of a transaction involving the securities of an issuer that is neither subject to section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m ; 78o(d)), nor exempt from reporting pursuant to section 240.12g3–2(b) of title 17, Code of Federal Regulations, nor a foreign government (as defined in section 230.405 of title 17, Code of Federal Regulations) eligible to register securities under Schedule B, the seller and a prospective purchaser designated by the seller obtain from the issuer, upon request of the seller, and the seller in all cases makes available to a prospective purchaser, the following information (which shall be reasonably current in relation to the date of resale under this section): (A) The exact name of the issuer and the issuer’s predecessor (if any). (B) The address of the issuer’s principal executive offices. (C) The exact title and class of the security. (D) The par or stated value of the security. (E) The number of shares or total amount of the securities outstanding as of the end of the issuer’s most recent fiscal year. (F) The name and address of the transfer agent, corporate secretary, or other person responsible for transferring shares and stock certificates. (G) A statement of the nature of the business of the issuer and the products and services it offers, which shall be presumed reasonably current if the statement is as of 12 months before the transaction date. (H) The names of the officers and directors of the issuer. (I) The names of any persons registered as a broker, dealer, or agent that shall be paid or given, directly or indirectly, any commission or remuneration for such person's participation in the offer or sale of the securities. (J) The issuer’s most recent balance sheet and profit and loss statement and similar financial statements, which shall— (i) be for such part of the 2 preceding fiscal years as the issuer has been in operation; (ii) be prepared in accordance with generally accepted accounting principles or, in the case of a foreign private issuer, be prepared in accordance with generally accepted accounting principles or the International Financial Reporting Standards issued by the International Accounting Standards Board; (iii) be presumed reasonably current if— (I) with respect to the balance sheet, the balance sheet is as of a date less than 16 months before the transaction date; and (II) with respect to the profit and loss statement, such statement is for the 12 months preceding the date of the issuer’s balance sheet; and (iv) if the balance sheet is not as of a date less than 6 months before the transaction date, be accompanied by additional statements of profit and loss for the period from the date of such balance sheet to a date less than 6 months before the transaction date. (K) To the extent that the seller is a control person with respect to the issuer, a brief statement regarding the nature of the affiliation, and a statement certified by such seller that they have no reasonable grounds to believe that the issuer is in violation of the securities laws or regulations. (4) Issuers disqualified The transaction is not for the sale of a security where the seller is an issuer or a subsidiary, either directly or indirectly, of the issuer. (5) Bad actor prohibition Neither the seller, nor any person that has been or will be paid (directly or indirectly) remuneration or a commission for their participation in the offer or sale of the securities, including solicitation of purchasers for the seller is subject to an event that would disqualify an issuer or other covered person under Rule 506(d)(1) of Regulation D (17 CFR 230.506(d)(1)) or is subject to a statutory disqualification described under section 3(a)(39) of the Securities Exchange Act of 1934. (6) Business requirement The issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that the issuer’s primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person. (7) Underwriter prohibition The transaction is not with respect to a security that constitutes the whole or part of an unsold allotment to, or a subscription or participation by, a broker or dealer as an underwriter of the security or a redistribution. (8) Outstanding class requirement The transaction is with respect to a security of a class that has been authorized and outstanding for at least 90 days prior to the date of the transaction. (e) Additional requirements (1) In general With respect to an exempted transaction described under subsection (a)(7): (A) Securities acquired in such transaction shall be deemed to have been acquired in a transaction not involving any public offering. (B) Such transaction shall be deemed not to be a distribution for purposes of section 2(a)(11). (C) Securities involved in such transaction shall be deemed to be restricted securities within the meaning of Rule 144 (17 CFR 230.144). (2) Rule of construction The exemption provided by subsection (a)(7) shall not be the exclusive means for establishing an exemption from the registration requirements of section 5. . (b) Exemption in connection with certain exempt offerings Section 18(b)(4) of the Securities Act of 1933 ( 15 U.S.C. 77r(b)(4) ) is amended— (1) by redesignating the second subparagraph (D) and subparagraph (E) as subparagraphs (E) and (F), respectively; (2) in subparagraph (E), as so redesignated, by striking ; or and inserting a semicolon; (3) in subparagraph (F), as so redesignated, by striking the period and inserting ; or ; and (4) by adding at the end the following new subparagraph: (G) section 4(a)(7). .

Passed the House of Representatives October 6, 2015. Karen L. Haas, Clerk.

tv_txt: IB Union Calendar No. 213 114th CONGRESS 1st Session H. R. 1839 [Report No. 114–281] IN THE HOUSE OF REPRESENTATIVES April 16, 2015 Mr. McHenry introduced the following bill; which was referred to the Committee on Financial Services October 6, 2015 Additional sponsor: Mr. Schweikert October 6, 2015 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed Strike out all after the enacting clause and insert the part printed in italic For text of introduced bill, see copy of bill as introduced on April 16, 2015 A BILL To amend the Securities Act of 1933 to exempt certain transactions involving purchases by accredited investors, and for other purposes.

1. Short title This Act may be cited as the Reforming Access for Investments in Startup Enterprises Act of 2015 or the RAISE Act of 2015 . 2. Exempted transactions (a) Exempted transactions Section 4 of the Securities Act of 1933 ( 15 U.S.C. 77d ) is amended— (1) in subsection (a), by adding at the end the following new paragraph: (7) transactions meeting the requirements of subsection (d). ; (2) by redesignating the second subsection (b) (relating to securities offered and sold in compliance with Rule 506 of Regulation D) as subsection (c); and (3) by adding at the end the following: (d) Certain accredited investor transactions The transactions referred to in subsection (a)(7) are transactions meeting the following requirements: (1) Accredited investor requirement Each purchaser is an accredited investor, as that term is defined in section 230.501(a) of title 17, Code of Federal Regulations (or any successor regulation). (2) Prohibition on general solicitation or advertising Neither the seller, nor any person acting on the seller’s behalf, offers or sells securities by any form of general solicitation or general advertising. (3) Information requirement In the case of a transaction involving the securities of an issuer that is neither subject to section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m ; 78o(d)), nor exempt from reporting pursuant to section 240.12g3-2(b) of title 17, Code of Federal Regulations, nor a foreign government (as defined in section 230.405 of title 17, Code of Federal Regulations) eligible to register securities under Schedule B, the seller and a prospective purchaser designated by the seller obtain from the issuer, upon request of the seller, and the seller in all cases makes available to a prospective purchaser, the following information (which shall be reasonably current in relation to the date of resale under this section): (A) The exact name of the issuer and the issuer’s predecessor (if any). (B) The address of the issuer’s principal executive offices. (C) The exact title and class of the security. (D) The par or stated value of the security. (E) The number of shares or total amount of the securities outstanding as of the end of the issuer’s most recent fiscal year. (F) The name and address of the transfer agent, corporate secretary, or other person responsible for transferring shares and stock certificates. (G) A statement of the nature of the business of the issuer and the products and services it offers, which shall be presumed reasonably current if the statement is as of 12 months before the transaction date. (H) The names of the officers and directors of the issuer. (I) The names of any persons registered as a broker, dealer, or agent that shall be paid or given, directly or indirectly, any commission or remuneration for such person's participation in the offer or sale of the securities. (J) The issuer’s most recent balance sheet and profit and loss statement and similar financial statements, which shall— (i) be for such part of the two preceding fiscal years as the issuer has been in operation; (ii) be prepared in accordance with generally accepted accounting principles or, in the case of a foreign private issuer, be prepared in accordance with generally accepted accounting principles or the International Financial Reporting Standards issued by the International Accounting Standards Board; (iii) be presumed reasonably current if— (I) with respect to the balance sheet, the balance sheet is as of a date less than 16 months before the transaction date; and (II) with respect to the profit and loss statement, such statement is for the 12 months preceding the date of the issuer’s balance sheet; and (iv) if the balance sheet is not as of a date less than 6 months before the transaction date, be accompanied by additional statements of profit and loss for the period from the date of such balance sheet to a date less than 6 months before the transaction date. (K) To the extent that the seller is a control person with respect to the issuer, a brief statement regarding the nature of the affiliation, and a statement certified by such seller that they have no reasonable grounds to believe that the issuer is in violation of the securities laws or regulations. (4) Issuers disqualified The transaction is not for the sale of a security where the seller is an issuer or a subsidiary, either directly or indirectly, of the issuer. (5) Bad actor prohibition Neither the seller, nor any person that has been or will be paid (directly or indirectly) remuneration or a commission for their participation in the offer or sale of the securities, including solicitation of purchasers for the seller is subject to an event that would disqualify an issuer or other covered person under Rule 506(d)(1) of Regulation D (17 C.F.R. 230.506(d)(1)) or is subject to a statutory disqualification described under section 3(a)(39) of the Securities Exchange Act of 1934. (6) Business requirement The issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that the issuer’s primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person. (7) Underwriter prohibition The transaction is not with respect to a security that constitutes the whole or part of an unsold allotment to, or a subscription or participation by, a broker or dealer as an underwriter of the security or a redistribution. (8) Outstanding class requirement The transaction is with respect to a security of a class that has been authorized and outstanding for at least 90 days prior to the date of the transaction. (e) Additional requirements (1) In general With respect to an exempted transaction described under subsection (a)(7): (A) Securities acquired in such transaction shall be deemed to have been acquired in a transaction not involving any public offering. (B) Such transaction shall be deemed not to be a distribution for purposes of section 2(a)(11). (C) Securities involved in such transaction shall be deemed to be restricted securities within the meaning of Rule 144 (17 C.F.R. 230.144). (2) Rule of construction The exemption provided by subsection (a)(7) shall not be the exclusive means for establishing an exemption from the registration requirements of section 5. . (b) Exemption in connection with certain exempt offerings Section 18(b)(4) of the Securities Act of 1933 ( 15 U.S.C. 77r(b)(4) ) is amended— (1) by redesignating the second subparagraph (D) and subparagraph (E) as subparagraphs (E) and (F), respectively; (2) in subparagraph (E), as so redesignated, by striking ; or and inserting a semicolon; (3) in subparagraph (F), as so redesignated, by striking the period and inserting ; or ; and (4) by adding at the end the following new subparagraph: (G) section 4(a)(7). .

October 6, 2015 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed