How to Check Rule 701 Eligibility in Eqvista?

Rule 701 is an exemption created by the Securities and Exchange Commission (SEC), allowing companies to issue stocks or stock options without registering the securities under the Securities Act. 

Note: The Rule 701 feature is only available for premium account holders. Kindly upgrade your account to unlock this feature. 

Here are the steps to follow:

Step 1: Log into your Eqvista account and select the company account. 

On the dashboard, click on “Compliance” on the left-hand side to get a drop-down menu and click on “Rule 701”.

Step 2: Once you do this, you will be redirected to the next page where you can begin the process of checking the eligibility for Rule 701. 

You begin by filling the field with company details – Check Period End, Total Outstanding Shares, Total Assets, and Balance Sheet Date. 

By default, the Check Period End is set to the current date, and Outstanding Shares to total shares issued within the specific period. To view the balance sheet, click the “->”right to the Balance Sheet Date field. 

Step 3: Here, you will see the list of securities eligible for exemption based on sales made within the preceding 12-month period of the selected end date. 

Select the securities by checking the checkbox or click “SELECT ALL” to check the qualification criteria for Rule 701. 

Note: The securities issued must be Common shares, Preferred shares, Options, or Warrants. The secondary transactions performed on the above grants are also eligible for Rule 701. 

Step 4: After selecting the securities, the aggregate sales price or amount of securities sold within a continuous 12-month period must meet one of the qualification criteria for Rule 701 exemption. 

Note: To know more in detail about the qualification criteria, check out our support article here!

The system calculates the value of all 3 qualification criteria, finds the highest case, and applies that as the “Greatest Value to Compare”.  

Step 5: When it passes one of the criteria, the status shows the company is “Qualified” for Rule 701 exemption as shown below. 

To review all the details, click on the “Download Report” button.

Step 6: When you click on this, the report gets downloaded as an Excel sheet in your Downloads. 

Double-click the Excel sheet to open the downloaded report.

To know more about the downloaded report, check out our support article!

For more information on Eqvista’s other features, check out our support articles or get in touch with us right away!