Private securities offerings under Regulation D allow New Jersey businesses to raise capital from investors without registering with the SEC. Understanding which exemption applies — and how to structure a compliant offering — is essential to avoiding costly securities violations.

Regulation D provides three main exemptions for private offerings. Rule 504 permits raises of up to $10 million from any investors within a 12-month period under certain conditions. Rule 506(b) allows unlimited raises from up to 35 non-accredited investors and an unlimited number of accredited investors, but prohibits general solicitation. Rule 506(c) permits general advertising and solicitation but restricts participation entirely to verified accredited investors. Each exemption has distinct disclosure, filing, and investor verification requirements that must be carefully followed.

New Jersey companies raising capital privately must also comply with state blue sky laws and file Form D with the SEC within 15 days of the first sale of securities. Missteps in structuring a Reg D offering — even unintentional ones — can expose founders to personal liability and rescission claims from investors. Ahmad & Hussain Law Group advises New Jersey businesses on selecting the right exemption, drafting offering documents, and maintaining compliance from the initial raise through ongoing investor relations.