REGULATION D - RULE 506:

Rule 506 of Regulation D is considered a “safe harbor” for the Private Offering Exemption of Section 4(2) of the Securities Act. Companies using the Rule 506 exemption can raise an unlimited amount of money. A company can be assured it is within the Section 4(2) exemption by satisfying the following standards:

  • The company cannot use general solicitation or advertising to market the securities unless they only accept investments from Accredited Investors pursuant to Rule 506(c);

  • The company may sell its securities pursuant to Rule 506(b)to an unlimited number of “accredited investors” and up to 35 other purchases. Unlike Rule 505, all non-accredited investors, either alone or with a purchaser representative, must be sophisticated—that is, they must have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of the prospective investment;

  • Companies must decide what information to give to accredited investors, so long as it does not violate the antifraud prohibitions of the federal securities laws. But companies must give non-accredited investors disclosure documents that are generally the same as those used in registered offerings. If a company provides information to accredited investors, it must make this information available to non-accredited investors as well;

  • The company must be available to answer questions by prospective purchasers;

  • Financial statement requirements are the same as for Rule 505; and

  • Purchasers receive “restricted” securities, meaning that the securities cannot be sold for at least a year without registering them.

 

While companies using the Rule 506 exemption do not have to register their securities and usually do not have to file reports with the SEC, they must file what is known as a Form D after they first sell their securities. Form D is a brief notice that includes the names and addresses of the company’s owners and stock promoters, but contains little other information about the company.

As an added service, Private Placement Markets will file all Form D's with the SEC for all Clients at no charge for the length of the Offering. 

 

To Retain and Engage Private Placement Markets for a Rule 506 Offering under Regulation D:

Since 2010, we have prepared hundreds (if not into the thousands) of Rule 506 Offerings, and have done so in nearly ever jurisdiction, for nearly all types of company structures, and all types of securities (from simple offerings of stock, to unit offerings, to structured finance offerings) and in every industry type. 

 

Service(s) to be Provided:

  • Drafting & Preparation of a State & Federal Securities Laws Compliant Rule 506 Offering under Regulation D.

    • Our Custom Rule 506 under Regulation D Offering Preparation includes Offering Structuring, Development of a Presentation Grade Private Placement Memorandum ("PPM"), all SEC Filing(s) as required, State filing support (as required), State & Federal Securities Laws Compliance Review,  and access to our Broker-Dealer Network & Institutional Investment Banking Network (See www.PPMEquity.com & www.PPMDebt.com)

  • Registration of all Form D's with the United States Securities and Exchange Commission for the sale of all Securities by the Company.

To engage us for a Custom Rule 506 - Regulation D Offering Preparation:

  1. Private Placement Markets is very selective about the Reg D 506 Clients it engages with. Please call our Capital Markets Team or email us as the contact listed to the left, and we will schedule a time to speak regarding your Reg D 506 needs.

  2. If there is a mutual interest to engage for the Drafting of your Reg D 506, we will forward you an engagement letter to be signed, at which time you will be required to submit a retainer equal to 50% of our service charge for the drafting of the Offering Memorandum. Our total estimated cost for a Rule 506 Offering under Regulation D is a Flat $1,750 USD (50% = $875 USD). NOTE: The balance of $875 will be due and payable 30 days net from retaining services or upon delivery of a final PPM document whichever comes first.

  3. Once complete, we will send you an email with information detailing the necessary information we need to get started working on your offering.

  4. General Time from Start-to-Finish, given the vast number of Offerings we have done over the past ten plus years, just a few days. 

Mr. Steve Muehler

Founder & Managing Member

Private Placement Markets

101 California Street

San Francisco, CA 94111

Email: Steve@PPMSecurities.com

Phone: (877) 259-8066

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Private Placement Markets, LLC (a Delaware Limited Liability Company) provides no depository services and is not insured by the FDIC. Private Placement Markets is an Investment Banking Industry Document Preparation Company and Capital Markets Advisor. Private Placement Markets does not offer, and does not offer to provide any broker dealer or market maker services. Private Placement Markets operates this website (referred to as the “Website”). By accessing this Website and any pages thereof, you agree to be bound by its Terms of Use and Privacy Policy. Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. Private Placement Markets does not provide financial planning services. Private Placement Markets does not provide tax advice and does not represent in any manner that the outcomes described herein will result in any particular tax consequence.

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