Preliminary Prospectus

A first draft registration statement filed by a firm prior to proceeding with an initial public offering of securities. The document, filed with the Securities & Exchange Commission, is intended to provide pertinent information to prospective shareholders about the company's business description, management, strategic initiatives, financial statements and ownership structure.

The SEC requires a preliminary prospectus to be printed with red ink on the left side of the cover; as a result, the document has been nicknamed the "red herring".