Pitch Competitions and the Securities Laws

Issuers who conduct presentations at pitch fairs and venture capital fairs face significant uncertainty regarding SEC compliance with the rules on general solicitation. The SEC recently released new rules that permit general solicitation; however, there are onerous filing requirements that many issuers will want to avoid. This is especially applicable to those who conduct presentations at events like pitch competitions, because all changes to the materials used would have to be submitted to the SEC.

Pitch Fairs and General Solicitation

In a recent meeting, the SEC confirmed that there is no definition of general solicitation, nor is there likely to be one in the near future. The SEC also refused to elaborate on whether pitch fairs could constitute general solicitation, stating that it would always be down to a facts and circumstances analysis. Worryingly, a representative from the North American Securities Administrators Association (NASAA) stated that all pitch competition presentations involve general solicitation, and they are only escaping attention because pitch fairs often have close ties to state agencies.

This is an area of high uncertainty, and although the SEC has not taken action against issuers conducting pitch competition presentations to date, it may seek to do so now that there is a new regime covering general solicitation.

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Roger Royse
rroyse@rroyselaw.com

Roger Royse, the founder of the Royse Law Firm, works with companies ranging from newly formed tech startups to publicly traded multinationals in a variety of industries. Roger regularly advises on complex tax structuring, high stakes business negotiations and large international financial transactions. Practicing business and tax law since 1984, Roger’s background includes work with prominent San Francisco Bay area law firms, as well as Milbank, Tweed, Hadley and McCloy in New York City.
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