Thursday, January 08, 2015

Maine Adopts Crowdfunding Registration Rule

[This story previously appeared in Securities Regulation Daily.]

By Jay Fishman, J.D.

This short-form seed capital registration rule, authorized by a Maine Uniform Securities Act short-form qualification registration provision, may be used only by issuers meeting the requirements of both the Maine statutory provision and federal Regulation D, Rule 504. Furthermore, the short-form registration is unavailable for issuers who, themselves, or whose affiliates are subject to specified “bad boy” disqualification provisions.

But qualified issuers may register their securities by sending the Maine Securities Administrator a Form FND-ME, Fund-ME Offering Circular Form, along with a prescribed subscription agreement and $300 fee for each type or class of security offered. Following registration, issuers must deliver to each purchaser a complete Form FND-ME, together with the subscription agreement. Issuers also must follow specified steps to place all invested funds in escrow.

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