Dropbox and Box are two rival cloud-storage companies that are raising large amounts of capital lately, but they are doing it in different ways under the securities laws.  Dropbox.com is raising private capital through a private placement of securities while Box.com is raising public capital through an initial public offering.  Success and failure in an…

In the last of its major rulemaking proposals under the JOBS Act, on December 18, 2013, the U.S. Securities and Exchange Commission (SEC) voted to publish proposed rules to modify and develop Regulation A, the so-called (and little-used) “small offering exemption.”  The proposed rules would modify and expand Regulation A, which currently exempts from SEC…

Reasonable Steps to Verify Accredited Investor Status. Rule 506(c) as adopted contains both a general requirement that issuers take “reasonable steps” to verify that purchasers are accredited investors, as well as a non-exclusive list of methods that can be used to satisfy this requirement. As originally proposed, Rule 506(c) did not mandate a particular verification process…