b'Certain bad actors are prohibited from participating in management, promotion, or owning 20% of any voting class of securities in the offering. There offering may require compliance with additional state rules and disclosure requirements. The offering may require state filing or pre-approval of offering documents. In my years of practice, no-one has wanted to follow Rule 504, because of the state pre-approval requirement. It is used, but not nearly as frequently asRule506,whichwewilldiscussnext.Youprobablywontusethis exemption, but there is a link to the SECs website if you want to learn more on our Book Bonus page:https://RaiseCapitalForRealEstate.com/BookBonus. Rule 506The Most Commonly Used ExemptionBy far, the most commonly used exemption has been the Regulation D, Rule 506 exemption, as illustrated in the table above. This is the exemption many private hedge funds and private equity funds are using to raise billions of dollars, and it is the exemption you are most likely to use, too.Prior to the inception of the Jumpstart Our Business Startups (JOBS) Act of 2012, there was only one option for a Rule 506 offering, and its primarycharacteristicwasthatitprohibitedgeneralsolicitationor advertising. This exemption arose in the 1980s as the original country club offering.Realestateinvestorscomplainedthatthepublicregistration 53'