Accredited investor – Who qualifies?
Groups (or an individual or entity) considered as a qualified accredited investor must fall under at least one of the following criteria:
- Natural persons who individually or jointly with their spouse have a total net combined worth in excess of $1,000,000.
- Natural persons who have an income in excess of $200,000 for the two most recent years with an expectation of such income in the current year, or those natural persons who have joint income with their spouse for such periods in excess of $300,000.
- A broker/dealer registered with the Commission under the Exchange Act purchasing for its own account as an investment is included. [Rule 501(a)(1)].
- Nonprofit tax-exempt organizations, corporations, partnerships, or business trusts with total assets of $5 million or more, provided that such entities have not been formed solely for the purpose of purchasing securities offered pursuant to Regulation D. [Rule 501(a)(3)].
- A small business investment company, business development company, insurance company, or bank.
- A trust with assets over 5 million that is not formed to acquire the securities offered. The purchase of the securities is controlled by someone with experience in business and financial matters and they must also be able to evaluate the risks in a possible investment.