A safe harbor is a rule, regulation or statute that provides a clear method for complying with an ambiguous law. Often legal requirements mirror underlying policy objections in requiring or proscribing behavior using broad language, ambiguous standards and theory. A safe harbor provision provides a practical example of behavior that complies with the broadly stated legal requirement. Companies use such provisions to mitigate the risk of noncompliance. Instead of reviewing broadly stated legal standards and related case law, in which various attempts at compliance have been reviewed by a court, a company can instead behave in accordance with a safe harbor provision and have confidence that it complies with law. Safe harbors exist in almost every legal regime a company may face. In startup financing, Rule 506 of Regulation D is considered a safe harbor for the private offering exemption found in Section 4(a)(2) of the Securities Act. The full text of Section 4(a)(2) provides that “transactions by an issuer not involving any public offering” are exempt from registration requirements. Rule 506 of Regulation D provides a list of practical and observable rules that any company can use to ensure their offering meets what amount to the ambiguous requirements of Section 4(a)(2).