Rule 504

The Regulation D 504 offering, is limited to a $1,000,000 per year, this offering is recommended for smaller transactions. Regulation D 504 allows companies to raise up to a maximum of $1,000,000 in a 12 month period.

The 504 is the least restrictive of the Regulation D programs regarding structure, financials, disclosure, and investor suitability. A 504 offering allows a company to sell securities to an unlimited number of purchasers without regard to their sophistication or experience – however some States may limit the company to 35 non-accredited investors while still allowing an unlimited number of accredited investors.

The 504 is the most popular and widely used of the Regulation D programs. Many companies use 504 for an initial round and then float a 506 for a larger second round - both offerings can be done in a 1 year period because they are separate exemption programs.  Regulation D 504 Offerings are can be used for private companies only, public reporting companies are prohibited from relying on the 504 exemption.

The 504 program is regulated at the Federal level and State level (the State the investor resides). Companies using the 504 program must file a Form D notification filing with the SEC (included in our service) and may be subject to informational filings at the State level depending on the residency of the investor. We have streamlined the State filing process - most companies only need to file in 1-5 States to sell out a 504 offering.