17 CFR Sec. 230.251
 Regulation A--Conditional Small Issues Exemption

 Sec. 230.251  Scope of exemption.
     A public offer or sale of securities that meets the following terms
and conditions shall be exempt under section 3(b) from the registration
requirements of the Securities Act of 1933 (the "Securities Act"):
    (a) Issuer. The issuer of the securities:
    (1) Is an entity organized under the laws of the United States or
Canada, or any State, Province, Territory or possession thereof, or the
District of Columbia, with its principal place of business in the United
States or Canada;
    (2) Is not subject to section 13 or 15(d) of the Securities Exchange
Act of 1934 (the "Exchange Act") (15 U.S.C. 78a et seq.) immediately
before the offering;
    (3) Is not a development stage company that either has no specific
business plan or purpose, or has indicated that its business plan is to
merge with an unidentified company or companies;
    (4) Is not an investment company registered or required to be
registered under the Investment Company Act of 1940 (15 U.S.C. 80a-1 et
    (5) Is not issuing fractional undivided interests in oil or gas
rights as defined in Sec. 230.300, or a similar interest in other
mineral rights; and
    (6) Is not disqualified because of Sec. 230.262.
    (b) Aggregate Offering Price. The sum of all cash and other
consideration to be received for the securities ("aggregate offering
price") shall not exceed $5,000,000, including no more than $1,500,000
offered by all selling security holders, less the aggregate offering
price for all securities sold within the twelve months before the start
of and during the offering of securities in reliance upon Regulation A.
No affiliate resales are permitted if the issuer has not had net income
from continuing operations in at least one of its last two fiscal years.

    Note: Where a mixture of cash and non-cash consideration is to be
received, the aggregate offering price shall be based on the price at
which the securities are offered for cash. Any portion of the aggregate
offering price attributable to cash received in a foreign currency shall
be translated into United States currency at a currency exchange rate
in effect on or at a reasonable time prior to the date of the sale of
the securities. If securities are not offered for cash, the aggregate
offering price shall be based on the value of the consideration as
established by bona fide sales of that consideration made within a
reasonable time, or, in the absence of sales, on the fair value as
determined by an accepted standard. Valuations of non-cash consideration
must be reasonable at the time made.

    (c) Integration with Other Offerings. Offers and sales made in
reliance on this Regulation A will not be integrated with:
    (1) Prior offers or sales of securities; or
    (2) Subsequent offers or sales of securities that are:
    (i) Registered under the Securities Act, except as provided in
Sec. 230.254(d);
    (ii) Made in reliance on Sec. 230.701;
    (iii) Made pursuant to an employee benefit plan;
    (iv) Made in reliance on Regulation S (Sec. 230.901-904); or
    (v) Made more than six months after the completion of the Regulation
A offering.

    Note: If the issuer offers or sells securities for which the safe
harbor rules are unavailable, such offers and sales still may not be
integrated with the Regulation A offering, depending on the particular
facts and circumstances. See Securities Act Release No. 4552 (November
6, 1962) [27 FR 11316].

    (d) Offering Conditions--(1) Offers. (i) Except as allowed by
Sec. 230.254, no offer of securities shall be made unless a Form 1-A
offering statement has been filed with the Commission.
    (ii) After the Form 1-A offering statement has been filed:
    (A) Oral offers may be made;
    (B) Written offers under Sec. 230.255 may be made;
    (C) Printed advertisements may be published or radio or television
broadcasts made, if they state from whom a Preliminary Offering Circular
or Final Offering Circular may be obtained, and contain no more than the
following information:
    (1) The name of the issuer of the security;
    (2) The title of the security, the amount being offered and the per
unit offering price to the public;
    (3) The general type of the issuer's business; and
    (4) A brief statement as to the general character and location of
its property.
    (iii) After the Form 1-A offering statement has been qualified,
other written offers may be made, but only if accompanied with or
preceded by a Final Offering Circular.
    (2) Sales. (i) No sale of securities shall be made until:
    (A) The Form 1-A offering statement has been qualified;
    (B) A Preliminary Offering Circular or Final Offering Circular is
furnished to the prospective purchaser at least 48 hours prior to the
mailing of the confirmation of sale to that person; and
    (C) A Final Offering Circular is delivered to the purchaser with the
confirmation of sale, unless it has been delivered to that person at an
earlier time.
    (ii) Sales by a dealer (including an underwriter no longer acting in
that capacity for the security involved in such transaction) that take
place within 90 days after the qualification of the Regulation A
offering statement may be made only if the dealer delivers a copy of the
current offering circular to the purchaser before or with the
confirmation of sale. The issuer or underwriter of the offering shall
provide requesting dealers with reasonable quantities of the offering
circular for this purpose.
    (3) Continuous or delayed offerings. Continuous or delayed offerings
may be made under this Regulation A if permitted by Sec. 230.415.

Copyright 2001, Legal Content Inc., all rights reserved.