I’ve been telling people that as long as a co-op’s members are all in the state where the co-op is located, does most of its business, and is incorporated, there is no need to worry about federal securities law which does not contain an exemption for non-agricultural co-ops.  If you offer memberships in more than [...]

Last year, Washington state adopted the community solar project investment cost recovery incentive to encourage communities to develop solar projects.  Unfortunately, the way the legislation was originally written, there could be only one incentive per investor so a group of investors could not pool their resources to build solar projects and each receive the incentive [...]

If you’ve read our blog at all, you know that we are constantly harping about securities!  I have been asked many times whether something that someone is offering is a security.  This post offers some guidance. A security is defined under federal law as “any note, stock, treasury stock, security future, bond, debenture, evidence of [...]

A company that wants to sell securities to California residents must complete a qualification – an extensive process similar to federal registration. There are some exemptions to this requirement.  One of the most commonly used is the 25102(f) exemption (named, creatively enough, after the section of the code where it is found). The following are [...]

Although it’s a little dry and boring (to anyone but us lawyers!), we thought some of you might find it helpful to get a brief overview of the securities law hurdles you face in raising funds for your business.  We’ll try to keep it as painless as possible. First, the general rule is that any [...]

The Small Business Investment Incentive Act of 1980 requires the U.S. Securities and Exchange Commission to host an annual forum that focuses on the capital formation concerns of small business.  Called the “SEC Government-Business Forum on Small Business Capital Formation,” this gathering has assembled every year since 1982.  The purpose of the forum is to [...]

Michael Shuman, author of Small-Mart Revolution, makes the following proposals in a recent article in Community Development Investment Review, a publication of the Federal Reserve Bank of San Francisco: One easy reform would be for the SEC to exempt from its usual expensive disclosure requirements any low-risk public ownership of locally owned microbusinesses. By low-risk, [...]

For A Green America‘s web site contains the complete text of proposed legislation that would allow the raising of “funds from the general public for a local investment pool (hereinafter “Community Fund”) . . . to invest in, and support local green businesses . . . through an unrestricted local public offering, without having to [...]

A “security” is, broadly speaking, an investment in a venture by a person who has a reasonable expectation of profits from the investment with such profits resulting from the entrepreneurial or managerial efforts of others. Why is it important to know what a security is?  Because if something is a security, it is subject to [...]