Wyoming Secretary of State

Exemptions

Summary

Securities offerings which do not rise to a level requiring registration are "exempted" from the registration and literature filing requirements of Wyoming's Act. Several exemptions are found in W.S. 17-4-114 which may apply to offers for, but not sales, used to test the waters, the Internet, the sale of private securities, a company's stock through its employee plan, and for Federal Regulation D, Rule 505 offerings. Keep in mind that persons who claim exemptions from registration have the burden of proving the exempt status of their offering.

"Test the Waters"

Before issuers spend money and soak lots of time into registering securities, it makes sense to first determine whether there is any investor interest in the company's business or product. This provision allows a company to actively seek indications of investor interest without leaping headlong into the securities registration process only to find that nobody is interested in their stock sale.

W.S. 17-4-114(b)(xiii) exempts offers, but not sales, of securities made on behalf of an issuer for the purpose of soliciting an indication of interest in receiving a prospectus. Wyoming Securities Rule, Chapter 6, Section 2(f), lists the conditions for "test the waters" as:
  • The issuer files a Solicitation of Interest Form (SOI form), the script of any broadcast to be made, a copy of video materials to be used, and copies of any notices to be published.
  • The items must be filed at least ten (10) days prior to usage.
  • No script, advertisement, or other material may be used in solicitation of interest which the Secretary of State has notified the issuer not to use.
  • No money may be solicited or accepted, nor may any commitment to purchase securities be accepted by the issuer until the securities are registered.
  • Any published notice or broadcast information shall contain the identity of the issuer's Chief Executive Officer, a description of the issuer's business or product, and statements that commitments to purchase and money may not occur during the solicitation.
  • All solicitations under this section must cease after registration of the securities begins.

© 2008 Wyoming Secretary of State's Office. All Rights Reserved.