The legislation also contains procedures for application to become a portal, details on portal operator’s responsibility to keep purchaser information private, and a “bad actor” disqualification which disqualifies from a MNvest offering any issuer having any director or executive officer who has been subject to listed disqualifying events. Amendments in 2017 to the crowdfunding statute enabled issuers to avoid the problem of integration of offering amounts where a company makes more than one offering in a given period of time and the amounts of the offerings are summed together providing the possibility of exceeding the statutory limit on offering amounts. The amendments effectively follow the new integration exemptions for federal crowdfunding offerings found in U.S. Securities and Exchange Commission Rule 147. Offers or sales made in reliance on the MNvest crowdfunding statute will not be integrated with: 1. Offers or sales of securities made prior to commencement of a MNvest offering or 2. Offers or sales of securities made after completion of a MNvest offering that are: A. Registered offerings under the Securities Act of 1933; or B. Exempt from registration under SEC Regulation A; C. Exempt from registration under SEC Rule 701 (dealing with equity offered to employees as compensation); D. Made pursuant to an employee benefit plan; E. Exempt from registration under SEC Regulation S (dealing with equity offerings outside the United States; F. Exempt from registration under the federal crowdfunding securities exemption; G. Made more than six months after completion of a MNvest offering. The amendment notes also that “for purposes of clarity” the new section does not permit a MNvest issuer to conduct simultaneous securities offerings. Isolated Sales Sales by a nonissuer of securities to no more than ten purchasers in Minnesota during any period of twelve consecutive months are exempt from registration as are nonissuer transactions by or through a broker dealer where the security has been in the hands of the public for at least 90 days. The exemption covers sales or offers to sell to an institutional investor; an accredited investor; a federal covered investment advisor, or any other person exempted by rule promulgated by the Commissioner of the Minnesota Department of Commerce.
75
Made with FlippingBook - Online Brochure Maker