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TOKEN SALE UNDER REG. D OFFERING

New York City Lawyers for Token Sales Under Reg. D Offering

Dilendorf & Khurdayan is a New York City blockchain law firm that assists clients in qualifying their virtual token sales for an exemption from securities registration under Regulation D.

Our attorneys leverage their thorough understanding of U.S. securities laws and experience guiding clients through the Regulation D process to quickly and effectively bring clients’ offerings to a successful conclusion.

ATTORNEYS' EXPERIENCE

Represented B2B / B2C blockchain freelance platform in the process of raising capital through Regulation D and S offerings to U.S. and non-U.S. investors, including review and analysis of the white paper and the project, preparation of the private placement memorandum (PPM), subscription agreements, guidance regarding the process of investor accreditation as well as AML/KYC checks, and filing Form D with the SEC.

Represented a blockchain based gaming platform in connection with structuring Regulation D and S offerings, including full review of the project, drafting a private placement memorandum and purchase agreement to launch the sale, guidance through the process of verifying U.S. accredited investors and completing KYC/AML checks, and filing form D with the SEC.

Represented a decentralized crypto exchange platform and advised the company regarding the process of raising capital in the U.S. through SEC Regulation A+ and D offerings, including money transmitting licenses in all 50 states, preparation of all necessary offering documents to launch token sale in the U.S.

Advised real estate development blockchain startup from UAE regarding a pre-ICO sale in the U.S. and compliance with SEC rules and regulations

Represented blockchain-based marine navigation service with AI capabilities in the process of raising capital via a TGE from U.S. and non-U.S. investors through Regulation D and S offerings, including review and analysis of the white paper and the project, preparation of all necessary documentation for the launch of the TGE, as well as guidance regarding the process of investor accreditation and AML/KYC checks.

Requirements for Exemption Under Regulation D

U.S. law generally requires securities (including virtual tokens that qualify as securities) to be registered with the government before they can be offered or sold. Regulation D provides two major exemptions from registration for some offerings.

Under Rule 504 of Regulation D, a company can offer and sell its virtual tokens to an unlimited number of investors, but the offering is limited to only $5 million during any 12-month period.

In comparison, under Rule 506, a company can offer and sell an unlimited amount of its virtual tokens. Rule 506(b) permits sales to up to 35 purchasers who do not qualify as accredited investors, but prohibits general solicitation. Rule 506(c) requires that all purchasers qualify as accredited investors, but permits general solicitation.

Regardless of which rule is used to exempt an offer of virtual tokens under Regulation D, the tokens will be subject to transfer restrictions. In general, those restrictions prohibit the tokens from being resold or transferred for at least one year after purchase.

Authoritative Guidance for Token Sales Under Regulation D

Dilendorf & Khurdayan provides comprehensive legal guidance and practical solutions throughout a Regulation D offering of virtual tokens. Our services include:

  • Carefully reviewing our clients’ circumstances and advising them on the optimal registration exemption for their token sales, whether under Regulation D or not.
  • Drafting detailed private-placement memoranda that clearly describe the virtual tokens and contain all necessary disclosures and disclaimers.
  • Advising clients on verification of the identifying information provided by prospective purchasers and determining purchasers’ eligibility to participate in a token sale.
  • Preparing and filing Form D to notify the SEC of the offering under Regulation D.
  • Structuring a simultaneous offering outside of the United States under Regulation S, if necessary.

Contact Us to Learn More About Our Regulation D Services for Token Sales

Send us an email or call 212.457.9797 to schedule a consultation at our Manhattan office.

For a consultation about structuring a token sale under Reg. D offering

please contact Dilendorf & Khurdayan by sending an email or calling us at 212.457.9797.

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