Founder Guide: SEC Filings for SAFE and Convertible Note Financings

This guide explains the main U.S. securities-law filing steps for a U.S. startup raising capital through a SAFE (Simple Agreement for Future Equity) or Convertible Note.

It is intended as an operational checklist for founders. It does not replace legal advice, particularly where non-accredited investors, foreign investors, public solicitation, broker/finder compensation, or unusual financing structures are involved.

1. Determine the Securities Law Exemption Before Accepting the Investment

A SAFE or Convertible Note is generally treated as a security for U.S. securities-law purposes.

A startup therefore should not simply accept an investment without identifying the exemption from Securities Act registration that applies to the transaction.

For private startup financings, the most common exemptions are:

Rule 506(b) of Regulation D

Rule 506(b) is commonly used for private startup financings where the company does not publicly advertise or generally solicit the investment.

An unlimited number of accredited investors may participate. Up to 35 non-accredited investors may participate subject to additional sophistication and disclosure requirements.

If non-accredited investors are involved, consult securities counsel before proceeding because additional disclosure obligations apply.

SEC guidance:

SEC — Rule 506(b) Private Placements

Rule 506(c) of Regulation D

Rule 506(c) permits general solicitation and public advertising of the fundraising.

However:

• every purchaser must be an accredited investor; and
• the company must take reasonable steps to verify accredited investor status.

A simple investor representation may not by itself satisfy the Rule 506(c) verification requirement.

SEC guidance:

SEC — Rule 506(c) General Solicitation

SEC — Assessing Accredited Investors

Foreign investors / Regulation S

If securities are offered and sold outside the United States to non-U.S. investors, counsel should determine whether the transaction may rely on Regulation S instead of, or alongside, Regulation D.

Do not assume that an investor qualifies for Regulation S merely because the investor is incorporated or resides outside the United States. The circumstances of the offer and sale must be reviewed.

A transaction relying solely on Regulation S generally does not trigger a Form D filing merely because Regulation S is being used.

2. Complete the Financing Documents

Before or as part of accepting the investment, finalize the applicable documents, such as:

• SAFE;
• Convertible Promissory Note;
• Note Purchase Agreement;
• SAFE Purchase Agreement, if applicable;
• board approvals / written board consent;
• stockholder approval, if required;
• accredited investor representations or questionnaire;
• Regulation S representations, where applicable; and
• any required corporate approvals.

The company should maintain a clear record of:

Investor legal name
Investor address and jurisdiction
Investment amount
Type of security
Applicable securities-law exemption
Date funds were received
Date documents were signed
Date investor became irrevocably contractually committed to invest

The last date is particularly important for Form D.

3. Determine the “Date of First Sale”

For Form D purposes, the relevant date is not necessarily the date on which money reaches the company's bank account.

The SEC defines the date of first sale as the date on which the first investor in the offering becomes irrevocably contractually committed to invest.

For example:

Investor wires money: March 1
SAFE is finalized and becomes legally binding: March 5
Investor was free to withdraw before March 5

The Date of First Sale may be March 5 rather than March 1.

However, if the investor was already irrevocably committed before the final SAFE was signed, the Date of First Sale could be earlier.

If funds were transferred before the final SAFE or Convertible Note was executed, do not automatically use either the wire date or signature date. Ask securities counsel to determine when the binding investment commitment arose.

SEC guidance:

SEC — Filing a Form D Notice

4. Calculate the Form D Deadline

If the offering relies on Regulation D, Form D generally must be filed:

within 15 calendar days after the Date of First Sale.

If the deadline falls on a Saturday, Sunday, or holiday, the filing is due on the next business day.

Example:

Date of First Sale: March 5
Normal Form D deadline: March 20

The company should begin the EDGAR registration process before closing the financing whenever possible.

SEC guidance:

SEC — Form D FAQ

5. Check Whether the Company Already Has an EDGAR Account and CIK

Form D is filed electronically through the SEC's EDGAR system.

Every filer has a unique SEC identifier called a:

CIK — Central Index Key.

Before applying for a new EDGAR account, confirm that the company does not already have a CIK.

If the company already has EDGAR access, proceed to the Form D preparation and filing steps.

If it has never filed through EDGAR, it will generally need to obtain EDGAR access first.

SEC overview:

SEC — What Is Form D?

6. Create Individual Login.gov Credentials

Individuals acting for the company in EDGAR must use their own individual Login.gov credentials.

Credentials must not be shared between founders, lawyers, employees, or filing agents.

Use an individual email address rather than a shared mailbox.

SEC instructions:

SEC — Obtain Login.gov Credentials for EDGAR

7. Apply for EDGAR Access Using Form ID

If the company does not yet have an EDGAR account, submit Form ID.

Important:

Form ID is not Form D.

Form ID = application to obtain EDGAR filing access.

Form D = notice regarding the securities offering.

Form ID is completed through the SEC's EDGAR Filer Management system.

The application requests information about the company and its prospective EDGAR Account Administrators.

SEC instructions:

SEC — Prepare and Submit Form ID

Do not wait until the Form D deadline to start Form ID. SEC staff reviews Form ID applications, so access may not be immediate.

8. Prepare the Form ID Authenticating Document and Notarization

The Form ID process requires an authenticating document signed by an authorized individual and notarized as required by the SEC instructions.

The authorized individual should have authority to bind the company, such as an appropriate officer.

Follow the current SEC Form ID instructions carefully because EDGAR access procedures can change.

SEC instructions:

SEC — Form ID Application Instructions

9. Designate EDGAR Account Administrators

Under EDGAR Next, the company must authorize individuals to manage its EDGAR account.

Normally, a company must maintain at least two Account Administrators.

A special rule applies to a single-member company. For EDGAR purposes, this means a company where one individual is simultaneously the:

• sole equity holder;
• sole director; and
• sole officer (or equivalent positions).

Such a company may maintain one Account Administrator.

If a prospective Account Administrator is not an employee of the company or its affiliate, a notarized Power of Attorney may be required.

SEC guidance:

SEC — EDGAR Next Roles

SEC — EDGAR Next FAQ

10. Receive the Company's CIK and Activate EDGAR Access

After the SEC grants the Form ID application, the company's Account Administrators receive information regarding the company's EDGAR account and CIK.

The Account Administrators should immediately confirm that they can access the company through the EDGAR Filer Management dashboard.

Additional users or a filing agent may then be authorized if necessary.

Do not share Login.gov credentials.

11. Prepare Form D

For a Regulation D financing, prepare Form D using the information for the offering as a whole, rather than treating every SAFE or Convertible Note as automatically requiring a separate Form D.

For example:

Investor A — SAFE — $100,000
Investor B — SAFE — $250,000
Investor C — SAFE — $150,000

If these investments are part of the same Regulation D offering, they may generally be reported as one offering rather than three unrelated Form D filings.

Form D requests information including:

• issuer's legal name;
• jurisdiction and year of incorporation;
• principal place of business;
• related persons such as executive officers, directors, and promoters;
• applicable federal exemption;
• Date of First Sale;
• duration of offering;
• type of securities;
• minimum investment;
• total offering amount;
• amount already sold;
• amount remaining to be sold;
• number of investors;
• sales commissions or finder's fees;
• states in which solicitation occurred; and
• use of proceeds for payments to related persons.

For a Convertible Note, the security may generally involve Debt and potentially other applicable classifications depending on its terms.

For a SAFE, the appropriate Form D classification should be determined based on the instrument and filing approach. Do not assume that every SAFE must be classified identically.

12. File Form D Through EDGAR

Once reviewed and approved, submit Form D electronically through EDGAR.

The SEC does not charge a federal filing fee for filing Form D.

Once filed, Form D becomes publicly accessible through EDGAR.

SEC instructions:

SEC — Filing a Form D Notice

13. Do Not Forget State “Blue Sky” Filings

Filing Form D with the SEC does not necessarily complete all securities-law filings.

For Rule 506 offerings, federal law generally preempts state registration and qualification requirements, but states may still require:

• a notice filing;
• a copy/data from Form D;
• consent to service of process;
• filing fees; and/or
• other state-specific information.

Therefore, immediately after determining where investors reside, identify the states in which notice filings are required and their deadlines.

Many state Regulation D filings can be submitted through NASAA's Electronic Filing Depository (EFD).

NASAA — Electronic Filing Depository (EFD)

State notice filings after each SAFE or Convertible Note closing

For offerings conducted under Rule 506 of Regulation D, federal law preempts state-level securities registration requirements. However, individual states may still require the issuer to submit a notice filing (typically a copy of Form D), pay a filing fee, and/or comply with other state notice requirements.

Many state Form D notice filings can be submitted electronically through the NASAA Electronic Filing Depository (EFD). Form D filing requirements and fees by state: NASAA EFD — Form D States

Accordingly, after each SAFE or Convertible Note closing under Rule 506, the company should identify the states in which the securities were offered or sold and determine whether a state Form D notice filing and filing fee are required. Filing Form D with the SEC through EDGAR does not by itself satisfy all applicable state Blue Sky filing requirements.

The state filing analysis should be performed for each investor's relevant jurisdiction rather than assuming that the federal Form D filing is sufficient.

14. Check Rule 506 “Bad Actor” Disqualification

Before relying on Rule 506(b) or 506(c), the company should conduct an appropriate inquiry regarding Rule 506(d) bad actor disqualification.

The rules cover the issuer and various other persons associated with the issuer or offering.

Certain criminal convictions, regulatory orders, court orders, and similar events can prevent the company from relying on Rule 506 or create disclosure requirements.

SEC guidance:

SEC — Rule 506 Bad Actor Disqualification

15. Maintain Supporting Records

The company should retain a complete financing file containing at least:

• executed SAFE(s) or Convertible Note(s);
• purchase/subscription agreements;
• board and stockholder approvals;
• investor questionnaires;
• accredited investor representations or verification records;
• Regulation S representations, where applicable;
• wire confirmations;
• cap table;
• Form D;
• EDGAR filing acceptance;
• state notice filings;
• state filing receipts;
• evidence of state filing fee payments; and
• correspondence with counsel regarding the applicable exemption.

Also record the company's reasoning for the Date of First Sale, particularly if funds were received before the final investment documents were executed.

16. Monitor the Offering After the Initial Form D

Form D is not necessarily a one-time compliance item.

If the offering continues for more than one year, an amendment generally must be filed annually on or before the anniversary of the most recently filed Form D notice.

Certain material changes or errors may also require an amendment.

Not every change requires an amendment. For example, changes solely to the amount of securities sold generally do not automatically require an amendment.

SEC guidance:

SEC — Filing and Amending Form D

Disclaimer: This article is for general information only and is not legal, tax or investment advice. Securities-law requirements depend on each offering, its investors and the states involved. Consult qualified US securities counsel.