Step 3: The Registration Statement & Prospectus

Writing the registration statement required by the SEC requires numerous work sessions and usually takes three to six weeks. The registration has two parts:

• Part 1 is the prospectus, which the SEC considers the legal offering or “selling” document. It contains important facts about your business operations, financial condition, and management. It also informs prospective investors of potential risk factors associated with investing in the company. All investors who are offered the opportunity to purchase stock must be provided with a copy of the prospectus.
• Part 2 contains additional financial and operating information about the company that is not required to be distributed to investors, but is made available on the SEC website.

The form that most companies use for registration is referred to as Form S-1. To look at this 8-page form on the SEC website, go to: www.sec.gov/about/forms/forms-1.pdf. This form is only a guide for writing the registration statement, not a fill-in-the-blank form. The registration statement and prospectus must be written in a more narrative format similar to a brochure. When it is finished and printed, it will look more like a booklet.

For more details on how the registration statement and prospectus are to be written, click this link: www.sec.gov/info/smallbus/qasbsec.htm#eod4.