Going Public by Way of Regulation D (504) Offering

Under the Securities Act of 1933, any offer to sell securities must either be registered with the SEC or meet an exemption. Regulation D (or Reg D) provides three exemptions from the registration requirements, allowing some smaller companies to offer and sell their securities without having to register the securities with the SEC.

Rule 504 or Regulation D provides an exemption from the registration of the federal securities laws for some companies when they offer and sell up to $1,000,000.00 of their securities in any 12 month period.

A company can use this exemption so long as it is not a Blank Check company and does not have to file reports under the Securities Exchange Act of 1934. Also, the exemption generally does not allow companies to solicit or advertise their securities to the public, and purchasers receive restricted securities, meaning that they may not sell the securities without registration or an applicable exemption.

Rule 504 does allow companies to make a public offering of freely tradable securities but only if one of the following circumstances is met:

(1) The company registers the offering exclusively in one or more states that require a publicly filed registration statement and delivery of a substantive disclosure document to investors;

(2) A company registers and sells the offering in a state that requires registration and disclosure delivery and also sells in a state without those requirements, so long as the company delivers the disclosure documents required by the state where the company registered the offering to all purchasers (including those in the state that has no such requirements); or

(3) The company sells exclusively according to state law exemptions that permit general solicitation and advertising, so long as the company sells only to "accredited investors.

An accredited investor is defined by federal securities law as:

. a bank, insurance company, registered investment company, business development company, or small business investment company;

. an employee benefit plan, within the meaning of the Employee Retirement Income Security Act, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5 million;

. a charitable organization, corporation, or partnership with assets exceeding $5 million;

. a director, executive officer, or general partner of the company selling the securities;

. a business in which all the equity owners are accredited investors;

. a natural person who has individual net worth, or joint net worth with the person's spouse, that exceeds $1 million at the time of the purchase;

. a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or

. Any trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase of the securities is directed by a person who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment.

. even if a company makes a private sale where there are no specific disclosure delivery requirements, a company should take care to provide sufficient information to investors to avoid violating the anti fraud provisions of the securities laws. This means that any information a company provides to investors must be free from false or misleading statements. Similarly, a company should not exclude any information if the omission makes what is provided to investors false or misleading.

Any information provided to an investor whether written or oral must be accurate in order not to violate the anti fraud provision,All securities offerings are subject to this provision.

This process provide a far less expensive way to take your company public than the traditional IPO, and it also provide a much faster track to having your company's shares listed and trading.

The Regulation D (504) offering is one method of going public we recommend to our clients, we normally conduct a review of the company to see if going public is a viable option for them.

Joseph D. Quinones, President of Genesis Corporate Advisors has spent over 25 years in the securities industry. In 1992 he founded JDQ Financial Group, Inc. and proceeded to build it up from a one man operation to the point where it employed many traders, advised numerous client and generate millions in revenues.

For other option please visit our website: www.genesiscorporateadvisors.com

Email: [email protected]

In The News:

Small business shopping in Nevada County  The Union of Grass Valley
Small Business Saturday  Investopedia

Look Out for that Great Accountant

There are many factors to be considered when you are... Read More

Small Business Marketing, According to Seinfeld

What could Seinfeld possibly have to do with marketing a... Read More

Build Credibility with Expertise

As an Investment Representative you've worked hard to build trust... Read More

Looking for a New Office Chair?

Perhaps you are building a new home office or you... Read More

Starting an Aircraft Washing Service

To wash an airplane there are many items you will... Read More

Using Holidays to Put Some Extra Cheer in Your Cash Box

No matter your age or station in life, we all... Read More

Blowing Your Own Horn ? A Key Marketing Strategy for Small Business

-- Building Credibility Through Success Stories --Successful solo entrepreneurs spend... Read More

Starting a Business in New Hampshire

Hew Hampshire car wash market. Well we have visited every... Read More

Franchises: How to Find the Best Franchise Opportunity for You

If you are looking for a franchise opportunity, the choice... Read More

Pressure Washing; How to Bid Concrete Cleaning Jobs

Remember the cleaning business is all about time ratio to... Read More

Small Business Publicity -- Worth It?

You bet it's worth it. Publicity via news releases, along... Read More

How to Prevent Home Business Burnout

As a home business proprietor, you may already realize why... Read More

Are You Making the Most of Your Intern?

KEEPING INTEREST HIGH: Supervision is key to the success of... Read More

Mobile Car Washes and Shoe Policies

Mobile carwashing is hard work, it is tough on the... Read More

Getting City Contracts; Local Government Contracting

All cities have a purchasing office and/or a procurement officer.... Read More

Small Business Franchise Opportunities

Many businesses offer small business franchise opportunities. There are many... Read More

Temporary Staffing Agency: How to Start

The temporary staffing industry continues to expand, with yearly double-digit... Read More

Not Listening Can Hurt Your Small Business

Most small business owners seek advisors who can help them... Read More

Book Yourself Solid Key #5: Go Forward With Gusto & Articulate What You Do

Want your small business to flip instead of flop?! Statistically... Read More

Accounting Methods ? Cash and Accrual

When starting a business, you have to determine the method... Read More

Entrepreneurs Go Virtual!

With the massive explosion of start-ups and home businesses developing,... Read More

Finding a Venture Capital Firm

Many ventures are faced with the challenging task of raising... Read More

Is Your Success Predetermined?

Your on-line success is based on your efforts and yours... Read More

Secrets of Cleaning Truck Trailers in Your Fleet from a Veteran Truck Washer

Cleaning the trailers towed by big trucks is not easy,... Read More

Boston Market; Mobile Auto Detailing

Boston itself covers 50 square miles of concrete and traffic,... Read More