Regulation A

AAA

DEFINITION of 'Regulation A'

An exemption from the registration requirements mandated by the Securities Act, applicable to small public offerings of securities that do not exceed $5 million in any 12-month period. A company that uses the Regulation A exemption for a securities offering must still file an offering statement with the Securities and Exchange Commission. While Regulation A offerings share some characteristics with registered offerings, they have some distinct advantages over full registration.

INVESTOPEDIA EXPLAINS 'Regulation A'

The issuer of a Regulation A offering has to provide buyers of the issue with an offering document whose content is similar to the prospectus in a registered offering. However, the advantages of a Reg A offering over a fully registered offering make up for this somewhat onerous requirement. These advantages include - simpler financial statements that do not have to be audited, no Exchange Act reporting requirements until the company has more than $10 million in assets and more than 500 shareholders, and the choice of three formats to prepare the offering circular.

RELATED TERMS
  1. SEC Form 1-A

    A filing with the Securities and Exchange Commission (SEC) required ...
  2. SEC Form 2-A

    A filing with the Securities and Exchange Commission (SEC) required ...
  3. SEC Form F-3

    A filing with the Securities and Exchange Commission (SEC) required ...
  4. SEC Form F-4

    A filing with the Securities and Exchange Commission (SEC) required ...
  5. SEC Form F-6

    A filing with the Securities and Exchange Commission (SEC) required ...
  6. SEC Form F-7

    A filing with the Securities and Exchange Commission (SEC) that ...
Related Articles
  1. Reg AC: What Does It Mean To Investors?
    Personal Finance

    Reg AC: What Does It Mean To Investors?

  2. Interpreting A Company's IPO Prospectus ...
    Fundamental Analysis

    Interpreting A Company's IPO Prospectus ...

  3. How To Identify A Micro-Cap Scam
    Personal Finance

    How To Identify A Micro-Cap Scam

  4. Policing The Securities Market: An Overview ...
    Investing Basics

    Policing The Securities Market: An Overview ...

comments powered by Disqus
Hot Definitions
  1. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  2. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  3. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  4. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  5. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
  6. Over The Counter

    A security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" ...
Trading Center