Rising Capital with Your Public Company

The Problem Solved by Continuous Offerings

Period to the introduction of Reg A+, companies with existing stock trading are willing to sell with the old Reg A. To achieve this, the price of the price of the stock had to be relatively reasonably compared to the market price. But, the market price by small companies can be unpredictable or volatile. To enable the company changes the offering price, the company must file an amendment of its Reg A+ filing, and it takes weeks to get the approval by the SEC. During this period of waiting, changes in the market price automatically mean that pricing would be out of date.

After the offering is approved by the SEC, companies have the right to offer stock at various prices over a period through the new Reg A+. At the time of sale, pricing information is filed after sale as a supplement which does not require the SEC review.


First, there is a need to understand the difference between “supplementing” and “amending” a Reg A offering. Both supplementing and amending occurs after the Reg A offering is “approved” by the SEC. Reg A offering is certified or approved when the company can cash investor checks upon the release of the offering by the SEC. If the offering is yet to be certified, then it is still under review by SEC.

Amending occurs when there is a major change and filing the amendment requires the SEC to review the offering once again.

Supplementing the offering occurs when no major change is made, and SEC does not have reason to review the offering.

In traditional IPOs, the sales document is referred as the prospectus while in Reg A offering, it is referred as the “offering circular.” Traditional IPOs a registration statement that contains the prospectus is file with the SEC while in Reg A IPOs file offering statements that contain the offering circular with the SEC.

Continuous Offerings

In continuous offering, all the offered stock is not sold at the beginning after the approval of the offering. Some stock is kept for future sale.

The company requires being up-to-date in its semiannual and annual report filling during the sale time to have a continuous offering.

You can do a continuous offering (1) for selling shareholders, (2) for a dividend or an employee benefit plan of the issuer, (3) for securities issued upon the exercise of outstanding options, warrants, or rights, for securities issued upon conversion of other outstanding securities, (4) for securities pledged as collateral, or (5) securities that are part of an offering which commences within two calendar days after the qualification date, will be offered on a continuous basis, may continue to be offered for a period in excess of 30 days from the date of initial qualification, and will be offered in an amount that, at the time the offering statement is qualified, is reasonably expected to be offered and sold within two years from the initial qualification date.

How to do a continuous offering

(1) Through selling shareholders,
(2) Through an employee benefit plan of the issuer or a dividend,
(3) Through securities issued upon the exercise of outstanding options, rights, or warrants, for securities issued upon conversion of other outstanding securities,
(4) Through securities pledged as collateral, or
(5) The securities that are part of an offering which starts within two days after the approval date, may be offered on a continuous basis for a maximum period of 30 days from the date of first approval at the exact amount during the period the offering statement is approved, and is reasonably expected to be offered and sold within 24 months from the first approval date

Continuous offerings will be used by most companies for selling shareholders and stock that will be sold within the next twenty-four months after the offering is approved.

Many companies will utilize continuous offerings for shareholders sales and stock that is intended to be sold within the next two years after the offering is qualified.

Bear in mind that the stock that is tagged “at the Market offering” cannot be sold into the market. The quoted simply means that you are bringing sell order into the market exactly as an ordinary shareholder holding free trading stock would do. Before you can hit the bid, you’ll have to find a buyer.

Supplementing the Offering Circular

Final pricing information in continuously offered stock can be applied by supplementing the offering circular, wherein the offering statement is approved on the idea of a genuine price range estimate. So, within the offering statement, you need to specify the range of price. When the SEC approves the offering, you’ll submit only a supplement stating the final pricing when you sell the stock.

However, you cannot leave out the number of securities (the volume of equity securities or aggregate primary number of debt securities) to be offered.

You can add-on the offering circular to change the price range of, or show a drop in the volume of, the securities offered in reliance on an approved offering statement within Regulation A, inasmuch as the decline in the volume of securities offered or change in the value range would not significantly change the declaration contained in the offering statement at official requirement.

Any decline in the securities volume offered and a fluctuation in price range, for instance, price drop from low or high may bounce back or be noticed by the commission in the offering circular supplement that has been filed if, on the average, the volume drop or price change represent not more than a 20% difference from the change from the highest average offering price measured using the information in the approved offering statement.

By no means, however, can your new terms surpass the limitation of the offering amount. Along these lines, if you submit an offering for the highest Reg A measure of $50 million, you can’t exceed that limit.

If the company leaves-out certain information related to price or pricing from an offering statement at the period of qualification, the company would need to submit an offering statement supplement pricing information not more than two business days after the earlier of such pricing information evaluation or the first date that the offering circular is used after qualification.


After an offering is approved, the company can submit an offering that allows selling of it stock. And shareholders can sell their stock that way also.

When the information of the final pricing is known, it is filed or submitted to the SEC within two days as supplement. Amendment is not required.

Call us to discuss how we can help your Company!


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