Federal Regulation D-Rule 505
Regulation D-Rule 505
Rule 505-Regulation D

Statute: § 551.23(19), Wis. Stats.

Used for: Transactions made in reliance on the exemption provided by Rule 505 of Regulation D under the Securities Act of 1933.

Note: In order to claim this exemption, there must be no disqualification from its use as set forth at § 551.23(19)(c)(1)a. to d., Wis. Stats.  No commission or other remuneration may be given to any person for soliciting or selling to any person in Wisconsin except to broker-dealers and agents licensed in Wisconsin.

Filing requirement:

Regulation D-Rule 505 Filing.

• Filing fee: $200, as set forth at § 551.23(19)(d), Wis. Stats. made payable to Wisconsin DFI-Division of Securities.
• Form required: Completed and signed copy of federal Form D.
• Exhibits required: Offering materials in compliance with the requirements of Rule 502 of Regulation D under the Securities Act of 1933.
• Timing of filing: Not later than the first use of an offering document or sale in Wisconsin, whichever happens first.
• Supplemental filings: a copy of each material amendment to the offering document must be filed not later than its first use in Wisconsin. There is no additional filing fee.

Frequently asked questions:

Q: When must we file in Wisconsin in order to claim use of this exemption?

A: Not later than the first use of an offering document or sale in Wisconsin, whichever happens first.

Q: Are there any Wisconsin legend requirements for the Private Placement Memorandum?

A: No.

Q: If the issuer makes the required filing, with the required exhibits, when can it commence offering and selling?

A: Immediately. The Division can stop the offer or sale only by administrative order.

Q: Can this exemption be used for Regulation D-Rule 504 transactions?

A: No. Any such offering must qualify for a separate exemption. See §§ 551.23(11) and (18), Wis. Stats., and § DFI-Sec 2.028, Wis. Adm. Code, for possible exemptions. The other alternative is to seek registration.

Q: Where can a copy of the federal Form D be obtained?

    A:  Link to Form D.

Q: Are sales to institutional or accredited investors counted toward the thirty-five sale limitation found in Rule 505?

    A: No. See § 551.23(8), Wis. Stats., and § DFI-Sec 2.02(4), Wis. Adm. Code.

Q: What must an issuer do to request waiver of the disqualifiers set forth at § 551.23(19)(c), Wis. Stats.?

    A: The Division suggests that any such request be made prior to the planned filing date of the § 551.23(19), Wis. Stats., filing. The waiver request should set forth a justification for waiver of the disqualifier.

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