Reg A+ testing the waters: Rule 255 before and after Form 1-A

Yes, a company can keep testing the waters during a Reg A+ review. Rule 255 runs from before a Form 1-A is submitted through the period after it is publicly filed, and ends only when the offering statement is qualified. The rule changes in the middle. After public filing, each solicitation must also give people the current preliminary offering circular or tell them exactly where to get it. A team that uses its prefiling ads unchanged through review can miss that requirement.

The public-filing date is therefore a campaign date, not only a counsel date. This post walks the issuer from its first interest page to qualification, with the communication rule that applies at each stage. If Reg CF is the likely path, start with Rule 206 instead. Its window ends much earlier.

This is general information, not legal advice. Securities counsel should approve the materials and communications for a particular offering.

The timeline at a glance

The SEC permits eligible issuers to submit a draft Form 1-A for nonpublic review. The draft and correspondence must become public at least twenty one calendar days before qualification. A nonpublic submission is not the same thing as the public filing that triggers the extra Rule 255(b)(4) circular requirement. Marketing needs both dates, plus the expected qualification date. SEC Reg A issuer guide.

Who may speak, and where?

Rule 255 permits the issuer or a person authorized to act on its behalf to communicate orally or in writing. That can include a campaign run with an outside team, but authorization is not a substitute for review. Counsel should approve who can speak, which materials they use, and how changes are controlled. The issuer still needs every public claim to match the Form 1-A and its exhibits.

There is no special channel list. The rule can cover a landing page, an email, an ad, a presentation, or an interview. A short format still needs the required statements. SEC staff guidance addresses platforms that cannot fit the legend: the issuer cannot omit required information just because the platform has a character limit. Design the placement with counsel before buying media.

Rule 255 communications are offers for federal antifraud purposes. That is true before the Form 1-A exists. Keep claims about revenue, customers, product progress, projected use of proceeds, and possible terms supportable. If the final offering looks different, investors and regulators will be able to compare the first pitch with the filed materials.

We are marketers, not securities lawyers. These are communications with prospective investors. The examples here may not comply with a particular offering or state-law path. Have securities counsel approve the campaign's legends, channels, materials, and update plan before they run.

What must prefiling materials say?

Rule 255(b) requires three statements before public filing. First, no money or other consideration is being solicited, and none sent will be accepted. Second, no offer to buy can be accepted and no part of the purchase price received until the offering statement is qualified, and any offer to buy may be withdrawn or revoked without obligation before the issuer gives notice of acceptance after qualification. Third, an indication of interest involves no obligation or commitment of any kind. Rule 255 text.

The withdrawal sentence is worth reading closely. It does not let a company take a payment now. It gives a prospective investor a chance to express interest and, under a properly run later process, make an offer that can be withdrawn before acceptance after qualification. The issuer cannot treat a prequalification indication as a booked sale. Follow-up emails should invite people to read the final materials and make a fresh decision, rather than claim their shares have been set aside.

Rule 255(c) allows a written response form and permits the issuer to require a name, address, telephone number, and/or email address. As with Reg CF, a possible investment amount is a useful measurement but is not one of those expressly listed contact fields. Have counsel approve the wording of an amount question. It should be a nonbinding indication, with no payment field or promised allocation.

The day Form 1-A becomes public

Once the offering statement is publicly filed, Rule 255(b)(4) adds one more requirement. The solicitation must either state from whom the most recent preliminary offering circular can be obtained, with that person's phone number and address; provide a URL to the current preliminary circular or the filed statement containing it; or include a complete copy. A link to a generic homepage is not the same as a direct path to the current document. The SEC's Reg A guidance confirms this postfiling condition.

That date demands a short operational checklist:

• Confirm with counsel when the Form 1-A becomes publicly available on EDGAR, including after any nonpublic draft review.
• Add the Rule 255(b)(4) circular path to every running page, ad, email template, presentation, and script that will continue.
• Test that the URL reaches the most recent preliminary circular on mobile and desktop.
• Pause old creative or change it before it can deliver a prefiling message after the public filing.
• Archive the old and new versions, with the date each ran, so the exhibit set is complete.

The circular can change during review. Rule 255(d) addresses materially inaccurate or inadequate solicitation materials used after public filing and can require redistribution in substantially the same manner as the original. It provides specific exceptions when the only stale information is in a preliminary circular supplied under the rule and the revised circular reaches prior inquirers or the direct URL continues to lead to the newest version. Do not improvise that decision in an ad account. Ask counsel whether the change is material, what must be redistributed, and to whom.

Filing the materials

Form 1-A Part III, Item 17, exhibit 13 calls for testing the waters materials, including Rule 255 materials and certain recent Rule 241 materials. The form instructions and current SEC staff interpretation clarify that substantively identical instances need not each be filed separately. A meaningful change in the pitch, terms, or claims should be preserved and assessed as a new exhibit. Later-used materials may require an amendment.

Keep the source files, actual live versions, dates, and broadcast scripts. The exhibit is public on EDGAR. Competitors, reporters, and later investors can read the same early pitch the first audience saw. That is an argument for clear, measured language, not for hiding the campaign. A useful testing period lets the team learn which message works before spending the full live-offering budget. testing-the-waters-materials-and-filing covers the collection work.

Rule 241 materials can also come along. The SEC's 2021 compliance guide says generic Rule 241 materials must be made public as an exhibit if the Reg A offering begins within thirty days of that solicitation. If the issuer changes exemptions midstream, counsel should decide which materials and audiences carry over. reg-a-plus-and-reg-d-at-once explains one reason that sequence matters.

Tier 1 and Tier 2 are different state-law campaigns

Tier 2 Reg A securities are generally covered securities for state registration purposes. Tier 1 securities are not. A Tier 1 issuer must account for state registration or qualification in each state where it plans to offer or sell, and state regulators can review its materials. Tier 2 preemption reduces state registration review, but it does not erase state antifraud authority or all state notices. blue-sky-preemption-in-reg-a explains the distinction; the SEC Reg A issuer guide directs issuers to state regulators for state-specific requirements.

The practical point arrives before the first nationwide ad. If the team has not chosen Tier 1 or Tier 2, it cannot assume that a national testing campaign is simple. The securities counsel who is deciding the tier should also review where the communication will appear and whether the states involved allow that offer at that stage. A social ad does not stop at a state line unless the campaign makes it stop.

What happens at qualification?

Rule 255 ends. The offering can move to sales only after qualification and the other conditions of Rule 251(d) are met. Written postqualification offers must be accompanied or preceded by the most recent offering circular. A special forty eight hour preliminary-circular delivery rule applies before a sale to someone who indicated interest before qualification when the issuer is not already required to report under Rule 257(b). Counsel should build that handoff into the subscription sequence.

An early indication is an invitation to return, not an automatic conversion. The person gets the current circular and decides on the actual terms. The issuer then accepts through its live offering process. That sequence matters for the email list: the launch message should point to the filed document and the proper subscription path, not ask a recipient to “complete” an old reservation.

The Reg A testing window is valuable because SEC review can take time and the issuer may keep learning during it. The work is to keep the pitch, circular, and list aligned as the filing changes. what-is-reg-a-plus explains the larger exemption. testing-the-waters-playbook covers the campaign plan for the period before qualification.

FAQ

Can you test the waters under Regulation A?

Yes. Rule 255 lets the issuer or an authorized person solicit interest orally or in writing before qualification, including before filing Form 1-A and during SEC review, with required statements and no money or commitments.

What is Rule 255?

It is Regulation A's solicitation-of-interest rule. It sets the prequalification window, required statements, response-form conditions, postfiling circular access, and rules for correcting materially inaccurate materials.

Can you test the waters after filing a Form 1-A?

Yes, until the offering statement is qualified. Once Form 1-A is publicly filed, the testing communication must also supply the current preliminary offering circular or tell the reader how to get it in one of the ways Rule 255(b)(4) permits.

What must a Reg A testing the waters page say?

It must say no money is solicited or accepted, no offer to buy or payment is accepted before qualification and an offer may be withdrawn before postqualification acceptance, and an indication creates no obligation. After public filing it must also make the preliminary offering circular available as Rule 255 specifies.

Do states review Reg A testing the waters materials?

Tier 1 can require state registration or qualification and state review of offers. Tier 2 generally preempts state registration, though states retain antifraud and certain notice powers. Counsel should check the target states before a testing campaign runs.

Where are Reg A testing the waters materials filed?

They are filed as exhibit 13 to Form 1-A. Substantively identical instances need not each be filed separately under SEC staff guidance, but later substantive variants should be preserved and evaluated for an amendment.

When does Reg A testing the waters end?

At qualification of the offering statement, not at the first Form 1-A filing. Sales then follow Rule 251 and the current offering circular requirements.