25 Offerees Per 12-Month Period, Limited Offeree

​​​​​​​​​​​​​​​​​​​​​​Statute: Wis. Stat. s. 551.202(14)

Used for: Offers to 25 or fewer persons in Wisconsin in any period of 12 consecutive months

Note: Sales of securities made under this exemption may result only from the 25 or fewer offers. Certain institutional and accredited investors need not be counted for purposes of the 25-offeree limit. The offeror must reasonably believe that all investors are purchasing for investment purposes rather than for resale or some other purpose. No commission or other remuneration may be given for soliciting, except to Wisconsin-registered brokers-dealers or agents. If an issuer or any of its controlling or affiliated persons is the subject of certain enforcement action, specified in Wis. Admin. Code s. DFI-Sec 2.029(3)(a), the issuer and its controlling and affiliated persons are disqualified from use of this exemption unless the disqualification is waived by the Division of Securities.

Filing requirement: Self-executing, with exceptions. No filing or Consent to Service of Process is necessary to claim this exemption, except when the offering exceeds $100,000 and the security being offered is a limited partnership engaged in oil and gas drilling or mining activities, or an investment contract security (as used here, "investment contract security" does not include common stock). For offerings subject to those exceptions, a notice filing must be filed with the division under Wis. Admin. Code s. DFI-Sec 2.02(5)(d)1, at least 10 days prior to the offering of the securities to any person in Wisconsin, unless the offering is through an unaffiliated broker-dealer registered in Wisconsin.

Notice filing, if required as set forth at Wis. Admin. Code s. DFI-Sec 2.03:

  • Filing fee: $200, as set forth at Wis. Admin. Code s. DFI-Sec 7.01(2)(b) made payable to Wisconsin DFI-Division of Securities.
  • Form required: There is no required form. File a cover letter, the required exhibits, and the fee at least 10 days prior to the offering in this state, referencing the statute or rule section under which the notice is filed.
  • Exhibits required: A copy of the prospectus, offering document, all other material to be delivered to offerees in connection with the transaction, and all other information the division may require after the filing.
  • Review time: 10 calendar days, unless extended pursuant to Wis. Admin. Code s. DFI-Sec 2.03(2)​.
In addition, under Wis. Stat. s. 551.202(14)(b), the division may issue a discretionary Order of Exemption that further conditions the exemption, increases or decreases the number of offerees, or waives conditions. The exemption is not available to persons or entities disqualified under Wis. Admin. Code s. DFI-Sec 2.02(5)(d)2.

To file a request for a discretionary Order of Exemption, see Discretionary Order of Exemption​.

Frequently asked questions:

Q: What is an investment contract?

A: The term is further defined under Wis. Stat. s. 551.102(28).

Q: Is there any limit on the number of people the offeror can talk to?

A: Yes. They may offer securities and distribute solicitation materials only to 25 or fewer persons in Wisconsin, other than certain institutional and accredited investors.

Q: Will broadcast or publication of advertising or circulation of advertising to more than 25 persons make an issuer ineligible for this exemption?

A: Yes, because any general advertising would necessarily constitute an offer to more than 25 persons.

Q: Is there a limit on the amount of money that may be raised?

A: No. The limit is solely in the number of persons who may be offered the securities, not to the amount that may be raised from those offers.

Q: Is this exemption available to non-Wisconsin issuers?

A: Yes. If the requirements of the exemption are met, a non-Wisconsin issuer may use this exemption.

Q: How is the 12-month period calculated?

A: On the day an offer is to be made, count the number of offers made in the preceding 12-month period. If offers to fewer than 25 persons have been made, as many offers as will bring the total to 25 for the 12 consecutive months may be made.

Q: Does inviting someone in Wisconsin to travel to another state to participate in a sale of securities constitute an offer in Wisconsin?

A: Yes. Any offer made to any person within the boundaries of the state of Wisconsin, regardless of the offeree's residence and regardless of where the actual sale takes place, is considered an offer made in Wisconsin.

Important interpretive letters (under predecessor statute):

May 30, 1980 letter re: Air Wisconsin, Inc.  A stock "option" is specifically included within the definition of security under Wis. Stat. s. 551.02(13)(a).  Therefore, as long as the previous grant by a corporation of options complied with all of the requirements for use of the registration exemption set forth in Wis. Stat. s. 551.23(11), the subsequent exercise of the same options would qualify as a "transaction pursuant to an offer .  .  .  ," (Wis. Stat. s. 551.23(11) since the exemption limits not the number of transactions pursuant to exempt offers, rather, the number of offers is limited. The exercise of the option, assuming it is pursuant to an earlier offer that did fit under the exemption set forth in this section, will not constitute an additional offer; rather, it is a transaction pursuant to the initial offer.

October 26, 1977 letter re: advertising. To qualify for this exemption, no newspaper advertising is allowed. The publication of an advertisement in a newspaper soliciting purchase of the securities would constitute an "offer" to each reader of the newspaper, which the division will presume results in more than the 10 offers permitted.

Related considerations: February, 1984 Wisconsin Securities Bulletin. As a result of language contained in 1983 Wisconsin Act 87 (effective November  17, 1983), representatives currently licensed for a broker-dealer or issuer can, under certain conditions, also acquire licenses to represent issuers intending to effect exempt securities transactions under those sections of the Wisconsin Uniform Securities Law.

History: Predecessor statute Wis. Stat. s. 551.23(11) adopted January 1, 1970.  Materially similar to section 402(b)(9) of the Uniform Securities Act of 1956. Amended effective October 1, 2002 to increase number of offers from 10 to 25. Repealed and recreated as Wis. Stat. s. 551.202(14), effective January 1, 2009.

Cont​​a​​ct Us

Phone: (608) 266-2139

Email: DFISecurities@dfi.wisconsin.gov​