DEFINITION of 'SEC Form D'

SEC Form D is a filing with the Securities and Exchange Commission (SEC). It is required for some companies, selling securities in a Regulation (Reg) D exemption or with Section 4(6) exemption provisions.

Form D is a short notice, detailing basic information about the company for investors in the new issuance. Such information may include the size and date of the offering, along with names and addresses of a company's executive officers. This notice is in lieu of more traditional, lengthy reports when filing a non-exempt issuance.

Form D must be filed no later than 15 days after the first sale of securities.

BREAKING DOWN 'SEC Form D'

Form D is also known as the Notice of Sale of Securities and is a requirement under Regulation D, Section 4(6) and/or the Uniform Limited Offering Exemption of the Securities Exchange Act of 1933.

This act, often referred to as the "truth in securities" law, requires that these registration forms, providing essential facts, are filed to disclose important information on a deal to partial owners – even in this less traditional form of registration of a company's securities. Form D helps the SEC achieve the objectives of Securities Exchange Act of 1933 – requiring that investors receive appropriate data prior to purchasing. It also helps prohibit fraud in the sale.

SEC Form D and Private Placements

Regulation D governs private placements of securities. A private placement is a capital raising event that involves the sale of securities to a relatively small number of select investors. These investors are often accredited and can include large banks, mutual funds, insurance companies, pension funds, family offices, hedge funds, and high and ultra high net worth individuals. As these investors usually have significant resources and experience, standards and requirements for a private placement are often minimal – in contrast with a public issue.

In a public issue or traditional IPO the issuer (private company going public) collaborates with an investment bank or underwriting firm. This firm or syndicate of firms helps determine what type of security to issue (e.g. common and/or preferred shares), the amount of shares to issue, the best offering price for the shares, and the perfect time to bring the deal to market. As traditional IPOs are often purchased by institutional investors (who then are able to allocate portions of shares to retail investors), it is critical that such public issuances provide thorough information to help less experienced investors fully understand the potential risks and rewards of partially owning the company.

RELATED TERMS
  1. SEC Form 26

    SEC Form 26 is a form filed by an exchange to notify the SEC ...
  2. SEC Form S-8

    SEC Form S-8 is a registration form for securities offered as ...
  3. Exempt Transaction

    An exempt transaction is a type of securities transaction where ...
  4. SEC Form 2-A

    SEC Form 2-A is a filing with the SEC required to disclose the ...
  5. SEC Form 18

    SEC form 18 is an SEC filing that is more commonly known as the ...
  6. SEC Form S-6

    SEC Form S-6 is a filing with the Securities and Exchange Commission ...
Related Articles
  1. Investing

    SEC Filings: Forms You Need To Know

    The forms companies are required to file provide a clear view of their histories and progress.
  2. Personal Finance

    Policing The Securities Market: An Overview Of The SEC

    Find out how this regulatory body protects the rights of investors.
  3. Managing Wealth

    Analyzing GE's Preferred Stock (GE)

    Learn why General Electric Company's new Series D Perpetual Preferred stock is an excellent choice for investors desiring a safe and steady income stream.
  4. Taxes

    What IRS Form 990 Tells About a Nonprofit

    Want a picture of an organization's activities? This annual form, open to the public, sums up everything from salaries paid to missions accomplished.
  5. Financial Advisor

    How To Get A Job At The SEC

    Want to make a good living taking on those renegade trading rascals on Wall Street? Here are some tips to help you get in the door at the SEC.
  6. Financial Advisor

    Succeeding At The Series 63 Exam

    Your career as a securities agent begins with this test. We'll show you how to score high.
  7. Small Business

    Why Companies Stay Private

    Many private companies prefer to stay private and find alternate sources of capital. Find out what firms have to gain by eschewing the windfall from a flashy IPO.
  8. Investing

    An Overview of the SEC's New Mutual Fund Rules

    The SEC has released new liquidity rules for mutual funds aimed at reducing risk.
  9. Taxes

    What IRS Form 1023 Is Used For

    To be treated as a tax-exempt organization, start by filling out this form.
RELATED FAQS
  1. How does private placement affect share price?

    Understand what it means when a company does a private placement, and find out how this typically impacts the share price ... Read Answer >>
  2. How often do mutual funds report their holdings?

    Learn how mutual funds are required by the Securities and Exchange Commission to disclose their portfolio holdings on a quarterly ... Read Answer >>
  3. How does FINRA differ from the SEC?

    Discover how Securities and Exchange Commission (SEC) is different from the Financial Industry Regulatory Authority (FINRA) ... Read Answer >>
  4. How are asset management firms regulated?

    Find out how the asset management industry is regulated and how those regulations fit within the broader scope of financial ... Read Answer >>
Trading Center