Overview of Regulation D, Rule 506(b), Rule 506(c) and other Capital-Raising Exemptions

Each offer and sale of a security must be (a) registered with the Securities and Exchange Commission (SEC); or (b) subject to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”). The offer and sale of securities are complicated. Both private and publicly traded companies raise money by registering their shares on Form S-1 or other registration statement under the Securities Act.  The Securities Act also provides exemptions from these registration requirements. The exemptions provide efficient methods for companies seeking capital. Often exemptions assist issuers in establishing a shareholder base in connection with a going public transaction.

The SEC offers several options for companies to raise capital by offering and selling securities without registration, known as an exempt offering. The following chart (provided by the SEC and available here)  summarizes the key metrics for the exemptions from registration that are most frequently used.

(click the following image to enlarge)

Related Articles:
Section 4(a)(2) and Rule 506(b) Exempt Offerings
Rule 506(c) Offerings
Private Placement Memorandum – Regulation D
Regulation D – the Bad Actor Rule
Regulation A White Paper
Blue Sky Laws – Regulation A Offerings
Regulation Crowdfunding
Rule 504

To speak with a Securities Attorney about raising capital for your company using an exempt offering, please contact Brenda Hamilton at 200 E Palmetto Rd, Suite 103, Boca Raton, Florida, (561) 416-8956, or by email at [email protected].

This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.

Hamilton & Associates | Securities Attorneys
Brenda Hamilton, Securities Attorney
200 E Palmetto Rd, Suite 103
Boca Raton, Florida 33432
Telephone: (561) 416-8956
Facsimile: (561) 416-2855