Business Law

Ask a Business Lawyer. Get Business Law Questions Answered ASAP.

Ask a Lawyer,
Get an Answer ASAP!

Business Law
This answer was rated:

A new startup company wants to raise seed money from friends

and family through issuing control...
A new startup company wants to raise seed money from friends and family through issuing control shares...what State and Federal regulations do we have to comply with? Is there a way to ask for a waiver?
Show More
Show Less
Ask Your Own Business Law Question
Answered in 29 minutes by:
6/24/2013
Law Educator, Esq.
Category: Business Law
Satisfied Customers: 121,098
Experience: All corporate law, including non-profits and charitable fraternal organizations.
Verified

Thank you for your question. I look forward to working with you to provide you the information you are seeking.

If shares will be sold to anyone or given to anyone other than a member/owner of the company, then the company must register with the SEC to sell shares and must have a company prospectus with company financial information. A company can only sell unregistered shares to "qualified investors" who are investors with about $1Million in assets and deemed to be experienced in investing. The SEC does not grant waiver of these rules on registration to sell shares to the public I am afraid as they want them secured and controlled. See: Accredited Investors.


There are restricted stock offerings to inside members of the company under Rule 144. Also, a company can raise up to $1,000,000 in capital with unregistered sales or up to $5,000,000 with no more than 35 non-accredited investors.


Thank you so much for using JustAnswer.com. I truly aim to please you as a customer, but please keep in mind that I do not know what you already know or don't know, or with what you need help, unless you tell me. If I did not answer the question you thought you were asking, please respond with the specific question you wanted answered. PLEASE use REPLY to EXPERT if you would like more information or if you feel something was not included in your answer.

Kindly remember the ONLY WAY experts receive any credit at all for spending time with customers is if you click on OK, GOOD or EXCELLENT SERVICE even though you have made a deposit or are a subscription customer. YOU MUST COMPLETE THE RATING FOR THE EXPERT TO RECEIVE ANY CREDIT, if not the site keeps your money on deposit.

Also remember, sometimes the law does not support what we want it to support, but that is not the fault of the person answering the question, so please be courteous.

Law Educator, Esq.
Category: Business Law
Satisfied Customers: 121,098
Experience: All corporate law, including non-profits and charitable fraternal organizations.
Verified
Law Educator, Esq. and 87 other Business Law Specialists are ready to help you
Ask your own question now
Ask Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 121,098
121,098 Satisfied Customers
Experience: All corporate law, including non-profits and charitable fraternal organizations.

Law Educator, Esq. is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises!

Gary B.Edmond, OK

My Expert was fast and seemed to have the answer to my taser question at the tips of her fingers. Communication was excellent. I left feeling confident in her answer.

EricRedwood City, CA

I am very pleased with JustAnswer as a place to go for divorce or criminal law knowledge and insight.

MichaelWichita, KS

PaulMJD helped me with questions I had regarding an urgent legal matter. His answers were excellent.

Three H.Houston, TX

Anne was extremely helpful. Her information put me in the right direction for action that kept me legal, possible saving me a ton of money in the future. Thank you again, Anne!!

ElaineAtlanta, GA

It worked great. I had the facts and I presented them to my ex-landlord and she folded and returned my deposit. The 50 bucks I spent with you solved my problem.

TonyApopka, FL

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

< Previous | Next >

Meet the Experts:

Infolawyer

Infolawyer

Attorney

1,851 satisfied customers

Experienced lawyer

Dimitry K., Esq.

Dimitry K., Esq.

Attorney

1,611 satisfied customers

Run my own successful business/contract law practice.

MShore Law

MShore Law

Attorney

1,233 satisfied customers

Drafted Negotiated and/or Reviewed Thousands of Commercial Agreements

RGMacEsq

RGMacEsq

Attorney

751 satisfied customers

Licensed Texas General Practice Attorney

Barrister

Barrister

Attorney

646 satisfied customers

17 years practicing attorney, JD, BA, MBA

Ely

Ely

Attorney

577 satisfied customers

Counselor at Law.

J.Hazelbaker

J.Hazelbaker

Attorney

393 satisfied customers

Experienced and trained in the area of business law.

< Previous | Next >

Related Business Law Questions
Can a startup Logistics Company incorporate as an LLC in
Can a startup Logistics Company incorporate as an LLC in Texas when it's members reside in NC and consequently the office also but the business operates out of Texas?The cargo, dispatch, and trailers … read more
Law Educator, Esq.
Law Educator, Esq.
Attorney
121,098 satisfied customers
This question is concerning startup financing. Prior to the
This question is concerning startup financing. Prior to the Seed round, if the startup raises $500k in debt financing, and offers the investor an equity kicker of say 4%, does the startup company need… read more
WiseOwl58
WiseOwl58
JD Honors Graduate
3,726 satisfied customers
I am looking to get private investment capital to secure
I am looking to get private investment capital to secure material from a factory overseas. The terms with the factory are 30% upon order and 70% upon delivery. My question is when I take the money fro… read more
Richard - Bizlaw
Richard - Bizlaw
Juris Doctor
3,700 satisfied customers
I am looking to purchase startup that provides a specialized
I am looking to purchase startup that provides a specialized business service (of the data analysis type). They have an office, specialized scanning equipment. We have roughly agreed on their ballpark… read more
WiseOwl58
WiseOwl58
JD Honors Graduate
3,726 satisfied customers
Launching startup and need organized step in what to do.
Launching startup and need organized step in what to do. I've formed my LLC and am just about done with website. Not sure what should do next.… read more
Edward Young
Edward Young
Juris Doctor
162 satisfied customers
I am looking to startup a part time photography studio, is
I am looking to startup a part time photography studio, is there an easier way to register and protect my name until I can?… read more
Roy Hadavi
Roy Hadavi
Attorney
Juris Doctorate
1,015 satisfied customers
About 10 years ago I was part of a startup along with two
Hello, about 10 years ago I was part of a startup along with two other people. Each of us brought $25,000 of our own money into the startup to fund it. Within about 6 months I was let go. I was never … read more
Infolawyer
Infolawyer
Attorney
Doctoral Degree
1,851 satisfied customers
I am 51% owner in an LLC. We need a capital call and also
I am 51% owner in an LLC. We need a capital call and also have liabilities, but the 49% owner is refusing to pay his 49% share. What are my options? … read more
Damien Bosco
Damien Bosco
3,395 satisfied customers
I have a 100% online startup business incorporated in
I have a 100% online startup business incorporated in delaware.The corporation name does not fit the marketing and product we r taking to market so we have a couple of choices 1. Apply for a DBA but i… read more
RGMacEsq
RGMacEsq
Attorney
Doctoral Degree
751 satisfied customers
A) I have a 100% online startup business(that has no
a) I have a 100% online startup business(that has no physical product) incorporated in Delaware. My startups first step is to accept financial pledges(credit card/debit card) to support our mission/ca… read more
lawyerJ
lawyerJ
Juris Doctorate
145 satisfied customers
1) Does a 100% online startup business that is incorporated
1) Does a 100% online startup business that is incorporated in Delaware need to foreign qualify in every state in the US ?2) As a startup the future is very uncertain so when is the time right you nee… read more
Roy Hadavi
Roy Hadavi
Attorney
Juris Doctorate
1,015 satisfied customers
Does a general partner need to make a capital contribution
does a general partner need to make a capital contribution when starting a limited partnership? … read more
KLAW
KLAW
Juris Doctorate
1,773 satisfied customers
I would like to invest in a private startup and because the
I would like to invest in a private startup and because the investment amount is small, the founder/CEO of the startup does not want to put my name directly on the company registration and cap table, … read more
Landon Lerner
Landon Lerner
Founder of San Diego Office
Doctoral Degree
12 satisfied customers
I would like to invest in a private startup and because the
I would like to invest in a private startup and because the investment amount is small, the founder/CEO of the startup does not want to put my name directly on the company registration and cap table, … read more
Richard - Bizlaw
Richard - Bizlaw
Juris Doctor
3,700 satisfied customers
We are a startup. What are the requirements to hire an
We are a startup. What are the requirements to hire an intern? This will be a non-paid internship.… read more
Law Educator, Esq.
Law Educator, Esq.
Attorney
121,098 satisfied customers
I am interested in transferring ownership of a startup
I am interested in transferring ownership of a startup company to another party. Also I am looking to transfer specific assets (i.e. Mobile service, vehicles, veh insurance, etc.) into the company's n… read more
Ray
Ray
Lawyer
Doctoral Degree
30,914 satisfied customers
I have a question about investments for a startup, as well
I have a question about investments for a startup, as well as setting up an investment vehicle.… read more
Damien Bosco
Damien Bosco
3,395 satisfied customers
How does a startup out of CT with limited capital acquire
How does a startup out of CT with limited capital acquire the advice of a lawyer, for more in depth analysis. I love this site because I get the answers that I need but I think it's time to start buil… read more
Marc
Marc
Attorney at Law
JD
318 satisfied customers

DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

Show MoreShow Less

Ask Your Question

x