Reg A+

What is a Reg A+?

Reg A+ is a new way to increase our capital by the securities exchange commission. The Regulation A + is a new law and according to regulation A + , a public can invest in private companies The rule of SEC allows companies to test the attractiveness of their business offering to the investor market. If our company is not public & plans to increase capital, we might have measured Regulation A Plus and we are conscious that it comes with a huge warning sticker, the business requirements to arrange an offering circular as well as go through an SEC approval method. To qualify for Reg A Plus offerings there is a procedure to follow. The Regulation A plus does cost a certain amount which we are going to be discussing below:

Attorney expenditure: To craft a perfect and relevant application, a professional attorney service may be taken. To fill the Form A-1 and other relevant documents the professional services of an attorney may be taken into consideration before submitting the documents to SEC. The chance of approval may get higher due to the services taken from an expert attorney. The fee and expense attorneys are different from each other; hence it may cost around $25k-85k.

EC Form 1A filing: $50k for a Tier 2, more for a Tier 1, payable to the legal service provider to do the work of gaining SEC qualification.

Audit: If you are new startup company it may cost you around $2k. However if you business is established it may cost you more. The cost for established businesses is approximately around $10k-$20k.>

Broker or dealer fees: These are the people who are professional in selling stock at fair price. Moreover they have the skills to start a professional marketing campaign. They charge a commission which depends upon the raised capital. The commission is around 5%-10%.

Other expenses:

SEC required annual audit – depends on your provider (For Tier 2 offerings only) and a nominal direct cost for each six months report to SEC about financial report.

Overall the procedure may cost you around $50k-100k as quoted by However you can complete the procedure within lower than the expected budget but for that you have to hire those attorney or brokers who are new in practice and are cost effective. As the concept of Reg A+ is currently new the service providers are charging much higher prices which with the passage of time may get cost effective.