Material Change in Offer #
If there is a material change in the offering (e.g., changes to terms, risks, or funding goals), the issuer must update the offering disclosure and file an amended document with the Securities and Exchange Commission (SEC). Investors must be notified, and depending on the nature of the change, they have the right to withdraw their investment.
Regulatory Compliance:
- SEC Rule 253 under Regulation A+ requires issuers to amend offering circulars and notify investors.
- Reg CF Rule 204 requires issuers to update Form C and allow investors to reconfirm or cancel their investment.
- Reg D offerings must disclose material changes that impact investor decision-making ( More on SEC Reg D).
Investor Withdrawal Rights & Refund Compliance #
The Admin records the change into the offer entity and determines its impact. The platform sends a legally required notification email informing investors of the change, their right to reconfirm, and any potential impacts. The system tracks investor responses, sending email reminders if not re-confirmed within 5 days. If investors do not reconfirm within 24 hours after the reminder email, the platform cancels their investment and initiates a refund.
Regulatory Compliance:
- Reg A and Reg CF require that if investors do not reconfirm within 5 business days, their investment must be canceled and refunded.
- Refunds must follow SEC Rule 15c2-4, ensuring investor funds are held in escrow until final investment confirmation ( More on SEC Rule 15c2-4).
Email Notifications & Security Compliance #
Our email-service integrates with a trusted delivery and marketing platform, ensuring security, compliance, and deliverability. It includes robust encryption and regulatory compliance with the Financial Industry Regulatory Authority (FINRA), protecting sensitive financial data and minimizing phishing or email spoofing risks. Additionally, third-party providers handle scalability, uptime, and automation, ensuring timely communication during high-traffic periods and streamlining investor notifications. By ensuring compliance with SEC, FINRA, and NACHA regulations, the platform guarantees investor protection, transparency, and secure processing of material changes and refunds.
Emails #
- investment/material_change.pug - required by law/SEC
- investment/failed-to-reconfirm.pug - required by law/SEC
flowchart TD A[Identify Material Change] --> B([LAW REQUIRED EMAIL : Material Change Details & Steps]) B --> C(Monitor Investor Responses) C --> D([LAW REQUIRED EMAIL : Material Change Reminder Email if applicable]) D --> C C --> E[Update Offer Status] E --> F([EMAIL : Confirming Status Changes])
Notice: Provider Variability and Compliance Assurance
Please be advised that, depending on customer preferences, the specific providers involved in the investment and related processes, including identity verification, accreditation checks, electronic wallet provision, email communications, and other related services, may vary. However, rest assured that all such providers are carefully selected to meet the highest standards of security, compliance with applicable laws and regulations, and user experience best practices.
Each provider undergoes a rigorous vetting process to ensure they align with our commitment to safeguarding your personal and financial information. We prioritize full adherence to regulatory requirements, ensuring that your investment experience remains secure, compliant, and seamless.
Test Cases
All processes on our platform are thoroughly documented, including detailed test cases, which are especially critical whenever changes are made. Test cases ensure that every feature functions as intended, identify potential issues early, and maintain the platform’s reliability, security, and compliance for our investors.
Related Use-Cases:
- Regulation D Solution
- Regulation A Software
- Broker Dealer Platform
- Secondary Market For Alternative Assets
- Regulation CF Crowdfunding
Read more on the subject #
- Investment Process Compliance
- Wallet Creation Compliance
- Electronic Payments Compliance
- Funds Transfer Compliance
- Bank Account Linking Compliance
- Investment Cancellation Compliance
- Offer Cancellation Compliance
- Offer Early Closing Compliance
- Successful Offer Closing Compliance
- UnSuccessful Offer Closing Compliance