506(b) and 506(c) offerings

Regulation D of the U.S. Securities Act provides two common private offering exemptions: Rule 506(b) and Rule 506(c). Both allow companies to raise investment funds without registering the offering with regulators. Rule 506(b) permits companies to sell securities to up to 35 non-accredited investors and an unlimited number of accredited investors, but they cannot advertise broadly. Rule 506(c) allows general advertising and solicitation, but all investors must be verified as accredited investors. These exemptions make it easier for companies to raise capital privately, with different rules for investor qualification and disclosure.