Which rule under the Securities Act of 1933 allows exempt issuance up to $1 million?

Rule 504 of the Securities Act of 1933 specifically allows for the issuance of securities exempt from the registration requirements, with a limit of up to $1 million in any 12-month period. This rule is designed to facilitate capital formation for smaller businesses by easing some regulatory burdens, thus encouraging investment in emerging companies.

Rule 504 is particularly beneficial for startups and smaller enterprises as it allows them to access funding from investors without undergoing the costly and lengthy process of full registration, provided they adhere to certain conditions. There are also specific provisions within Rule 504 that outline when the exemption is available, such as limitations on resale and adherence to state securities laws.

Other rules under the Securities Act address different aspects of securities issuance and may have higher thresholds or varying requirements. For instance, Rule 506 provides an exemption for private placements but does not have a set dollar limit like Rule 504. Therefore, understanding these distinctions helps clarify the particular utility of Rule 504 for businesses seeking less than $1 million in funding.