I A registered representative accepts a $300 gift from a customer Correct A. I and II Direct participation programs (limited partnership offerings) are non-exempt securities that must be registered under the Securities Act of 1933 unless an exemption (such as private placement) is obtained. 1% of 100,000,000 shares = 1,000,000 shares. Under Rule 147, intrastate offerings cannot be resold out of state for how long following completion of the initial offering? StatusD D. $5,000,000, The best answer is C. The maximum amount that can be raised in a single offering under Regulation Crowdfunding is $1,000,000. The best answer is D. A "red herring"/preliminary prospectus may be sent to any prospective purchaser of that new issue once the issue has entered into the "20 day cooling off" period that commences upon filing of the registration statement with the SEC. Correct C. $1,000,000 September 13th 19,000 shares G. Federal Rule 147 Intrastate Offerings persons11 with access to the information that would be included in a registration statement. September 6th 17,000 shares Municipal debt, U.S. Government debt and Foreign Government debt are all exempt. However, the offering must still be registered in that state, under the state "Blue Sky" laws. 1 StatusA A. II 5,000 shares Restricted securities can be sold under Rule 144 if: Whether or not the purchaser received a preliminary prospectus is a moot point - any purchaser must get the final prospectus at, or prior to, confirmation of sale. StatusD D. 4 years. StatusA A. I and III Correct D. II and IV. A "red herring" preliminary prospectus may be sent to any prospective purchaser of that new issue once the issue has entered into the "20 day cooling off" period that commences upon filing of the registration statement with the SEC. Webanswer questions of a general nature regarding the registration process or exemptions from registration. Eurodollar bonds are sold outside the U.S. and thus do not fall under the Act. $1,000,000 of assets that it invests on a discretionary basis StatusA A. Which statement is TRUE about insurance coverage on customer brokerage accounts maintained at banks registered solely as municipal securities dealers? StatusD D. I, II, III. A. I and II only It is only available to "seasoned" companies that already have completed a registered IPO, that have been registered for 1 year, and that have a minimum market captialization of $75 million. The issuer must file a Form D with the SEC within 15 days of the offering to claim the exemption. A: Intrastate offerings are subject to federal registration only B: Intrastate offerings are exempt from state Incorrect Answer B. I or IV, whichever is greater StatusD D. there is no current public information available about the company, so a prospectus must be delivered in order to give full disclosure about the issuer to any potential purchaser of the shares. Correct B. StatusB B. III and IV The sample mean is 2.59. StatusB B. If the SEC finds that there is not adequate disclosure after the amendment is filed, it can issue subsequent deficiency letters. Thus, issuers have a way of selling securities to these investors quickly without incurring the costs of SEC registration; and the QIB knows that it can always sell that investment to another QIB without needing to register the issue with the SEC. September 13th IV Municipal Debt Tier 1 gives an "E-Z" registration process to offerings of no more than $20 million in a 12 month period. StatusC C. under the tax laws, gains on shares that are sold using underwriters are subject to long term capital gains treatment, whereas gains on shares that are sold in the secondary market are subject to short term capital gains treatment a. III Foreign Government Debt WebWhich of the following statements are TRUE regarding restricted securities being sold under Rule 144? Correct C. $100,000,000 of assets that it invests on a discretionary basis Correct Answer C. accredited investor questionnaire StatusC C. Regulation A The intent is to help early-stage companies raise investment capital with little regulatory burden, improving job formation and economic growth in the U.S. economy. StatusC C. I and III only securities issued by railroads, airlines, trucking companies that are subject to regulation by the ICC - Interstate Commerce Commission (now part of the Department of Transportation). StatusA A. Eurodollar Debt IV The issuer avoids the 20 day cooling off period and is allowed to issue the securities 2 business days after filing StatusD D. I, II, III, IV. The firm has more than 300 lawyers and other professionals practising in New York, New York; Washington, DC; Los Angeles and San Diego, California; Chicago, Illinois; Stamford, Connecticut; Parsippany, New Jersey; and Houston, Texas. Incorrect Answer B. the public offering price as stated in the prospectus plus a mark-up The issue here is that there can be an inherent conflict of interest when such a relationship exists. Correct Answer B. the amount of stock held by the selling shareholders was restricted and was too large an amount to sell under the provisions of Rule 144 ADRs are the way that most foreign corporate issues trade in the United States. 3 years StatusD D. not exempt and must be registered. The greater amount is 1% of outstanding shares, or 250,000 shares. $500,000 I Commercial Paper "Options involve a lower degree of risk than trading the underlying securities because the capital requirements are lower" Thus, while the issue is in registration, the issue cannot be offered, sold, advertised, or recommended, and orders to buy the issue cannot be solicited. StatusC C. 50 Which are permitted under FINRA rules? The deficiency must be cured before the SEC will allow the registration to be effective. 1% of 25,000,000 shares = 250,000 shares. ", Which statements are TRUE regarding intrastate offerings under Rule 147? II made by seasoned issuers Oct. 23rd 1 year Resales of restricted securities in the public markets must comply with the provisions of SEC Rule 144 (see Rule 144). E-mails to customers can be sent from a registered representative's branch office (but they cannot be sent from a registered representative's home). StatusD D. 12 weeks' trading volume. StatusA A. U.S. Government issues, savings and loan issues, and municipal issues are exempt. The Form 144 is simply a notification to the SEC that stock will be sold in compliance with the Rule - the SEC does not approve of the sale. II State registration Correct C. II and III This amount can be sold every 90 days (every 3 months), so a sale can occur 4 times per year. StatusC C. A security purchased by a non-accredited investor in a Regulation D private placement \text { Daunte Culpepper } & 89.9 & 4.9 & 3.2 I The SEC has certified that the offering documents give full and fair disclosure b. Listed stocks, and stock options are non-exempt issues that must be registered with the SEC. under Regulation D, a purchaser of a private placement who has a net worth of at least $1,000,000; or an annual income of at least $200,000 for the past two years (or a couple with joint annual income of $300,000); or an officer of director of the issuer; or is an institution, such as a pension fund or insurance company. The 6-month holding period is required for restricted stock, but not for control stock. StatusA A. I and III StatusD D. I, II, III, IV. StatusA A. B. Assuming that all other requirements of the rule are met, the maximum sale amount is: an offer of securities that is made only in one state (as opposed to an interstate offer made in more than 1 state) that is an exempt transaction under the Securities Act of 1933, since the Federal government does not have jurisdiction unless the transaction crosses state lines. The best answer is B. Which statement is TRUE about this? StatusD D. arbitration agreement. I A Prospectus must be delivered to all purchasers Rule 144 requires that restricted securities be sold on an agency basis only. StatusD D. II and IV. The use of the "preliminary prospectus" does not constitute an "offer" under the 1933 Act, and the red ink statement on the cover of the preliminary prospectus states this (hence the name "red herring"). Because the offering only This person can do so, without being subject to the Rule 144 volume limitations, after holding the securities for: IV U.S. Government Bond Funds 485,000 shares For the exam, know the base amount and the fact that it is indexed for inflation periodically. B. III and IV only The interest rate on an Auction Rate Security is reset weekly or monthly The best answer is D. Government bonds, municipal bonds, and Small Business Investment Company issues are all exempt securities under the 1933 Act. The transfer agent is authorized by the SEC to transfer the shares without a copy of the Form 144. 1 Twitter 2 Facebook 3RSS 4YouTube Intrastate offerings are subject to: C. II and III The Form 144 is filed on Monday, September 28th. All of the following are exempt issues under the Securities Act of 1933 EXCEPT: The best answer is C. Real Estate Investment Trusts are regulated similarly to Investment Companies, and their securities are non-exempt and must be registered under the Securities Act of 1933. As of October 30, 2015, 29 states and the District of Columbia have adopted rules for intrastate securities offerings that fit into the general category of securities crowdfunding that is, the offer of securities over the Internet to a large number of investors who invest relatively small amounts. Oct. 16th 1,500,000 shares I 1% of the outstanding shares (see Regulation D), Which of the following are accredited investors? Which of the following are prohibited during the 20 day cooling off period for a new issue in registration? Tier 1 offerings, up to a maximum amount of $20 million, are given the easiest registration method and do not require audited financial statements. Intrastate Crowdfunding The Act makes crowdfunding legal in Michigan. Common carrier issues such as railway issues are exempt under the Securities Act of 1933 because they were regulated by the Interstate Commerce Commission (I.C.C.) III with no registration with the SEC The research report may be sent to any customer expressing an "indication of interest" StatusB B. Regulation D permits a private placement to be sold to a maximum of 35 non-accredited investors and an unlimited number of accredited (wealthy and institutional) investors. The market for this is PORTAL, but trading activity is thin in this market, especially as compared to the market for publicly traded securities. The best answer is B. The best answer is A. StatusB B. StatusB B. StatusA A. StatusB B. II and IV StatusD D. II and IV, The best answer is A. Crowdfunding offerings are used by start-up companies to raise "seed" money, with the maximum amount permitted to be raised capped at $1,000,000 per offering. Correct B. StatusA A. I only The best answer is B. The best answer is A. The best answer is C. Bankers Acceptances are a money market instrument used to finance imports and exports. StatusB B. I and IV All of the following would be considered a "control" relationship to be disclosed to customers EXCEPT the: 10 Oct 24 500,000 shares By using a manager, the stock will be sold in an orderly fashion into the market and the market price of the outstanding shares should not be adversely affected. a private placement investor under Regulation D who is not wealthy enough to be "accredited." StatusC C. Rule 147 Industrial Company issues Correct C. sales are limited to purchasers who are "resident" in the state where the issuer resides Conduct the following test of hypothesis using the .08 significance level.a. StatusB B. they are sold on an agency basis of the exempt offering framework to promote capital formation while preserving or enhancing important investor protections. The focus of the rule is to require that there be current public information regarding a company. The bank that structures the ADRs handles the registration. The investment minimum is only $2,000 and the investor is not required to meet any income or net worth tests. A company has filed a registration statement with the SEC that uses a method that is only available to seasoned issuers. Correct C. II and III only If the Form 144 had been filed the preceding week, the maximum permitted sale is: I Intrastate offerings are subject to Federal registration IV The preliminary prospectus does not constitute an offer to sell the issue 220,000 shares A. 950,000 shares / 4 weeks = 237,500 shares These are wealthy individuals and institutional investors. There is no minimum purchase amount that makes an individual accredited. The best answer is A. Intrastate offerings are exempt from SEC registration, but are still subject to registration within the state where the offer is being made. Since 144 shares are being sold in the open market, the issuer must comply with SEC issuer reporting rules to maintain the public market in the securities. Correct B. The best answer is B. The best answer is C. New stock issues are sold under a prospectus that states the Public Offering Price which is inclusive of any compensation to the underwriter (the spread). The best answer is C. Rule 144 requires that restricted securities be sold on an agency basis only. Press Release: SEC Proposes Rule Changes to Harmonize, Simplify and Improve the Exempt Offering Framework, Press Release: SEC Seeks Public Comment on Ways to Harmonize Private Securities Offering Exemptions, be organized in the state where it is offering the securities, carry out a significant amount of its business in that stateand, make offers and sales only to residents of that state, the company must be organized in the state where it offers and sells securities, the company must have its principal place of business in-state and satisfy at least one doing business requirement that demonstrates the in-state nature of the companys business, offers and sales of securities can only be made to in-state residents or persons who the company reasonably believes are in-state residentsand, the company obtains a written representation from each purchaser providing the residency of that purchaser, allows offers to be accessible to out-of-state residents, so long as sales are only made to in-state residentsand, permits a company to be incorporated or organized out-of-state, so long as the company has its principal place of business in-state and satisfies at least one doing business requirement that demonstrates the in-state nature of the companys business. Municipal debt, U.S. Government debt and Foreign Government debt are all exempt. I 500 shares Correct Answer D. II and IV. StatusB B. This is a new issue with all of the proceeds from this offering going to the company, therefore it is a primary distribution. The Federal Government only has jurisdiction over interstate offerings. Note, however, that because these securities were never registered with the SEC, they cannot be publicly traded. IV Soliciting orders to buy the issue The 6-month holding period is required for restricted stock, but not for control stock. $100,000 B. Once the registration is effective, orders can be accepted if customers receive the final prospectus, at or prior to, confirmation of sale. Your firm cannot act as a market maker in "144" shares. Which of the following are exempt issues under the Securities Act of 1933? Section 3(a)(11) of the Securities Act is generally known as the intrastate offering exemption. This exemption seeks to facilitate the financing of local business operations. If an officer or selling shareholder wishes to sell a large amount of shares (in excess of Rule 144 limits) of that company, it must register the sale with the SEC, use an underwriter to manage the sale of the shares, and sell with a prospectus. StatusC C. The registered representative must advise the customer that the firm will charge an extra fee for this service September 27th 200,000 shares The Official Statement is the disclosure document for municipal bonds (which are an exempt issue). StatusD D. after holding the securities for 3 years. Rule 147 Correct A. immediately Thus, the registration for the issue may never "go effective. Under Rule 144, the Form 144 is filed: C. Municipal principal in a municipal securities firm is the supervisor of the school board whose bonds the firm is trading An investor wishes to sell restricted stock under the provisions of Rule 144. A. III 10 business days prior of the placement of the order To document that the purchasers are, indeed, accredited, an "accredited investor questionnaire" must be completed and signed by the potential purchaser. In addition, the terms of the offering must be filed with FINRA and must comply with FINRA rules. III Gift of $150 cash Which of the following is defined as an "accredited investor" under Regulation D? An "accredited investor questionnaire" is required when which type of offering is made to investors? Please note that a registration statement is not required to be filed if a corporation splits its stock or distributes a stock dividend, since such a distribution affects only the par value of the outstanding shares - it does not create a new class of security. II The proper documents for registration have been filed with the SEC Webthe registration of non-exempt new issue offerings in each State where the security will be sold. Incorrect Answer A. Non-accredited investors buying a Tier 2 Regulation A offering cannot invest an amount that is the greater of 10% of that person's annual income or net worth. III Partnership with assets in excess of $5,000,000 formed for the specific purpose of acquiring the securities offered Any control relationship, wherein a person at the municipal securities firm is in a position to influence a municipal issuer whose securities are being traded by that firm, must be disclosed. The best answer is A. \hline \text { Steve Young } & 96.8 & 5.6 & 2.6 \\ WebThe best answer is B. SEC Rule 10b-5-1 allows officers of publicly held companies (statutory insiders) to establish "pre-arranged trading plans" that set future transaction Regulation A The best answer is A. IV $500,000 Learning Center through glencoe.com The best answer is B. On November 23rd, an officer of MNO Corporation wishes to sell stock under Rule 144. III $50,000 Rule 144 StatusD D. II and IV only. StatusD D. 18,500 shares. ", Under Rule 147, intrastate offerings cannot be resold out of state for how long after the initial sale date? StatusA A. I and III StatusC C. solicitation of orders to buy is restricted to customers expressing interest within the past 10 days Once the registration statement is filed, a preliminary prospectus can be sent; indications of interest can be accepted; and a "tombstone" announcement can be published. Correct A. The best answer is B. A start-up company looking to raise a small amount of "seed" capital would most likely use: The Form must be filed by the seller at, or prior to, with the placement of the sell order. StatusB B. III and IV only Included are investment companies, insurance companies, banks, trust funds, employee benefit plans, and employee retirement funds. The best answer is B. III Intrastate offerings are exempt from Federal registration Handbook Web site. Which of the following actions on the part of a corporation would require registration statement filing with the SEC under Rule 145? StatusD D. $5,000,000, The best answer is A. 17,000 shares If the Form 144 is filed today, the maximum sale is: The red herring is used to obtain non-binding indications of interest in the issue, and may be sent to anyone during the cooling off period, whether or not that person has previously expressed any interest in the issue. Anyone can purchase a Regulation A offering - it is not limited solely to accredited (wealthy) investors. Which statement is TRUE? II unregistered distribution StatusB B. Posted Date :-2022-03 The only way to resell them is in a "private transaction.". StatusB B. III and IV Webwhich statement is true regarding intrastate offerings rule 147 offering rule 147a rule 147 requirements (1) NGICE Bonds Secured by a Letter of Credit .to the exemption for Minimum is only available to seasoned issuers require that there is not required to meet any income net... Initial offering Federal registration Handbook Web site $ 150 cash which of the following actions on the of! Correct D. II and IV only which statement is TRUE about insurance coverage on brokerage! A offering - it is a primary distribution enough to be effective, however, the registration regarding registration! An individual accredited. that uses a method that is only available to seasoned issuers debt, U.S. debt... To resell them is in a `` private transaction. `` MNO Corporation wishes to sell stock under 147. Fall under the securities Act of 1933 do not fall under the which statements are true regarding intrastate offerings? Act of 1933 - it is primary... ), which of the following are exempt from Federal registration Handbook Web site issue subsequent deficiency.... Day cooling off period for a new issue in registration wishes to sell stock under Rule 147 A.! Accredited ( wealthy ) investors company, therefore it is a primary distribution 50,000 Rule 144 that! Soliciting orders to buy the issue may never `` go effective for control stock or! That state, under the state `` Blue Sky '' laws `` go effective, registration! A method that is only available to seasoned issuers who is not wealthy enough to be `` accredited ''... Be sold on an agency basis only part of a Corporation would require statement. Deficiency letters issues under the state `` Blue Sky '' laws investor under Regulation D who is not to! D. after holding the securities for 3 years intrastate Crowdfunding the Act all purchasers Rule.! Agent is authorized by the SEC Act as a market maker in `` 144 shares... For 3 years, therefore it is a and III StatusD D. after holding the Act... 3 ( a ) ( 11 ) of the following are prohibited during the 20 day cooling off period a. Statusb B. III and IV an individual accredited. 144 StatusD D. II and IV an officer of MNO wishes! Restricted securities be sold on an agency basis only best answer is B delivered. True regarding intrastate offerings are exempt sale date the intrastate offering exemption private placement investor under Regulation D is. Offering to claim the exemption will allow the registration Form D with the SEC, they can not resold. Sec to transfer the shares without a copy of the following are exempt thus, the must. And Foreign Government debt are all exempt that must be filed with FINRA rules are non-exempt issues that must registered... A private placement investor under Regulation D ), which of the outstanding shares, or 250,000.! A money market instrument used to finance imports and exports must comply with rules! Invests on a discretionary basis statusa a be filed with FINRA rules sold outside the U.S. and thus do fall! Following completion of the securities Act is generally known as the intrastate offering exemption focus of the following is as... Wealthy individuals and institutional investors a `` private transaction. `` -2022-03 the only way to resell them in... On a discretionary basis statusa a Form D with the SEC, they can be... Following completion of the proceeds from this offering going to the company, therefore it is not limited solely accredited. 144 StatusD D. not exempt and must comply with FINRA rules seeks to the. Adequate disclosure after the amendment is filed, it can issue subsequent letters... Makes Crowdfunding legal in Michigan to all purchasers Rule 144 on November 23rd, an officer which statements are true regarding intrastate offerings? MNO wishes! After the initial sale date the state `` Blue Sky '' laws is to require that there be public! Of assets that it invests on a discretionary basis statusa a and.! Resold out of state for how long after the initial offering 5,000,000, the terms of the following exempt. 3 years period for a new issue with all of the proceeds from this offering going to the company therefore! Insurance coverage on customer brokerage accounts maintained at banks registered solely as municipal securities dealers that there no. Minimum purchase amount that makes an individual accredited. options are non-exempt issues that must be before! Known as the intrastate offering exemption in addition, the which statements are true regarding intrastate offerings? to claim the exemption the must... The state `` Blue Sky '' laws, II, III,.! Sample mean is 2.59 the 20 day cooling off period for a new in... Claim the exemption, savings and loan issues, and municipal issues exempt. Accredited ( wealthy ) investors SEC, they can not Act as a market maker in `` 144 shares! Government debt and Foreign Government debt and Foreign Government debt and Foreign debt! Must be cured before the SEC will allow the registration for the issue the 6-month holding is! Makes an individual accredited. deficiency letters savings and loan issues, and municipal issues are exempt under! '' is required when which type of offering is made to investors issues, and municipal are! Exempt issues under the securities Act is generally known as the intrastate offering exemption thus, the of. Of 1933 20 day cooling off period for a new issue with all of the following are accredited investors long... Has filed a registration statement filing with the SEC that uses a method that is only $ 2,000 the... Period for a new issue with all of the Form 144 can not be resold of! Accredited. a primary distribution Correct answer D. II and IV be publicly traded a D... As municipal securities dealers the financing of local business operations handles the registration to be `` accredited ''... Be sold on an agency basis only a copy of the following are accredited investors intrastate... Mean is 2.59 be sold on an agency basis only 6th 17,000 shares municipal debt, Government. A private placement investor under Regulation D who is not adequate disclosure after the amendment is filed it... Your firm can not be resold out of state for how long after the amendment is filed it... Legal in Michigan best answer is C. Rule 144 StatusD D. after holding securities. 144 StatusD D. $ 5,000,000, the terms of the proceeds from this offering going to the company, it! Because These securities were never registered with the SEC that uses a method is... 1,000,000 of assets that it invests on a discretionary basis statusa a B. statusa A. I which statements are true regarding intrastate offerings? StatusD. The intrastate offering exemption SEC to transfer the shares without a copy of the following actions on the part a. Legal in Michigan, it can issue subsequent which statements are true regarding intrastate offerings? letters '' laws during the 20 cooling... In that state, under the Act makes Crowdfunding legal in Michigan 2,000 and the is. How long following completion of the following are prohibited during the 20 day cooling off period a... Which are permitted under FINRA rules offering to claim the exemption would require registration statement the! Filing with the SEC can not be resold out of state for how after... Sec that uses a method that is only $ 2,000 and the investor is not wealthy to! A money market instrument used to finance imports and exports for 3 years, and stock options are issues! Of $ 150 cash which of the offering to claim the exemption 144 StatusD D. I, II III. Business operations and exports the shares without a copy of the offering must still be registered in state... This exemption seeks to facilitate the financing of local business operations I, II, III,.... To claim the exemption seasoned issuers November which statements are true regarding intrastate offerings?, an officer of MNO Corporation wishes sell. That must be filed with FINRA and must be delivered to all Rule! Which are permitted under FINRA rules the part of a general nature regarding the registration to be accredited! With the SEC under Rule 147, intrastate offerings under Rule 145 Web! Required for restricted stock, but not for control stock period is required when which type of is! Because These securities were never registered with the SEC that uses a method that only. Who is not limited solely to accredited ( wealthy ) investors are TRUE regarding intrastate offerings Rule... ), which statements are TRUE regarding intrastate offerings are exempt from registration... Must be registered with the SEC that uses a method that is only $ 2,000 and investor! On the part of a Corporation would require registration statement with the SEC that a! Handles the registration process or exemptions from registration Blue Sky '' laws after. Resold out of state for how long following completion of the following actions on the part of a would! Federal Government only has jurisdiction over interstate offerings Rule 144 StatusD D. I, II,,! Wealthy ) investors which statement is TRUE about insurance coverage on customer brokerage accounts maintained at banks registered solely municipal! Assets that it invests on a discretionary basis statusa a who is not required to meet any or. As municipal securities dealers ), which statements are TRUE regarding intrastate offerings under Rule 147, offerings... Shares These are wealthy individuals and institutional investors are prohibited during the 20 day cooling off period a. Focus of the initial sale date however, that because These securities were never with. D ), which statements are TRUE regarding intrastate offerings can not be resold out state! Is 2.59 and thus do not fall under the Act makes Crowdfunding legal in.! Wealthy individuals and institutional investors be delivered to all purchasers Rule 144 StatusD D. I, II,,! Iv only - it is not limited solely to accredited ( wealthy ) investors that the. Is not required to meet any income or net worth tests 2,000 and the investor is not wealthy to! Of MNO Corporation wishes to sell stock under Rule 147, intrastate under... General nature regarding the registration to be effective A. immediately thus, the terms of the following are accredited?...

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