What is 25102f? A Guide to California's Limited Offering Exemption

Q: Who can use this exemption?

Startup founders and small businesses in California can use this exemption to issue shares to a limited number of investors.

Q: Do I need to file anything to use this exemption?

Yes, you must file a notice with the California Department of Business Oversight.

Definition & Meaning

Section 25102(f) of the California Corporations Code outlines a legal exemption for limited offerings. This provision is commonly used by startup founders in California to avoid the need for their founders' shares to be qualified with the state. To utilize this exemption, founders must submit a notice under section 25102(f), which helps streamline the process of issuing shares without extensive regulatory requirements.

Table of content

Legal Use & context

This term is primarily used in the context of corporate law, specifically regarding securities and fundraising for startups. It allows founders to issue shares without the lengthy qualification process typically required by state law. This exemption is particularly relevant for early-stage companies seeking to raise capital from a limited number of investors, often friends and family, without incurring significant regulatory burdens.

Key legal elements

Real-world examples

Here are a couple of examples of abatement:

Example 1: A California startup founder wants to raise funds from ten friends to launch a new product. By filing a 25102(f) notice, they can issue shares without going through the full qualification process.

Example 2: A small tech company in California seeks to offer shares to its initial employees as part of their compensation. They can use the 25102(f) exemption to do so without extensive compliance requirements. (hypothetical example)

Relevant laws & statutes

The primary statute relevant to this term is the California Corporations Code, specifically section 25102(f). This section outlines the requirements and conditions under which the limited offering exemption can be utilized.

Comparison with related terms

Term	Definition	Key Differences
Section 25102(f)	Exemption for limited offerings in California.	Specific to California and limited to certain types of offerings.
Regulation D	Federal exemption for private placements.	Applies nationwide and includes different rules for accredited investors.

Common misunderstandings

What to do if this term applies to you

If you are a startup founder in California considering issuing shares, ensure you understand the requirements of section 25102(f). File the necessary notice with the California Department of Business Oversight. For assistance, explore US Legal Forms' templates for filing notices, or consult a legal professional if your situation is complex.

Find the legal form that fits your case

Browse our library of 85,000+ state-specific legal templates.

This field is required

Quick facts

Typical Fees: Varies by filing; check with the California Department of Business Oversight.
Jurisdiction: California.
Possible Penalties: Non-compliance may result in fines or legal action.