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. There is no restriction on resales within that state. IV secondary distribution Once the amendment is filed, the 20-day cooling off period starts counting again from the beginning. 225,750 shares Correct B. I and IV 200,000 shares Correct B. 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). The President of PDQ Corporation donates restricted PDQ shares to the United Way after holding them for 3 months fully paid. Conclude your report StatusC C. I and III only A corporation files a registration statement with the SEC to issue 300,000 shares out of its authorized stock and to sell 200,000 shares of restricted stock held by officers of the corporation. One is not accredited because a large purchase of the private placement is made. Correct D. None of the above. I Commercial Paper Correct C. II and III Nov. 12th Correct D. II and III only. StatusB B. September 27th 280,000 shares StatusA A. September 20th 20,000 shares Assuming that all other requirements of the rule are met, the maximum sale amount is: II Couple earning $300,000 per year StatusA A. I and II only StatusA A. StatusB B. 4.The number of columns and data types must be identical for all SELECT statements in the query. If a corporation merges with another publicly held company, a new corporation is being created, and a registration statement must be filed as well. StatusB B. a maximum of 4 sales per year are permitted \text { Tom Brady } & 92.9 & 5.4 & 2.4 \\ StatusC C. Rule 147 Incorrect Answer B. 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. II Savings and Loan Issues Statement A is untrue - options have greater risk than the underlying securities because they are more volatile and lose time value each day. Retail communications must be approved in advance by a principal. -Intrastate offerings are subject to State registration -Intrastate offerings are exempt from Federal registration StatusC C. a Form 144 must be filed with the SEC Restricted securities can be sold under Rule 144 if all of the following conditions are met EXCEPT: The only way to resell them is in a "private transaction. 280,000 shares Other investment companies - whether they be open-end or closed-end management companies; or unit investment trusts; are non-exempt and must be registered with the SEC. The best answer is B. The maximum permitted sale amount is: CFR Title 47. Conduct the following test of hypothesis using the .08 significance level.a. The 1934 Act does not apply to initial offerings. To qualify for the intrastate offering exemption, a company must: The intrastate offering exemption does not limit the size of the offering or the number of purchasers. StatusB B. III and IV StatusB B. StatusD D. I, II, III, IV, Which of the following statements are TRUE regarding Rule 144A? The best answer is C. B. There is no limit on the number of accredited investors that can purchase a private placement under Regulation D. Regarding institutional investors, any investment company, insurance company, bank, or savings and loan is accredited. StatusD D. any price since this is a negotiated market offering. III the weekly average of the prior 4 weeks' trading volume A maximum of 35 non-accredited investors are permitted in a private placement for the transaction to be exempt under the Securities Act of 1933. WebTo purchase an intrastate offering, the purchaser must be a primary resident of that state. StatusA A. I only This procedure avoids the "20 day cooling" off period, and allows seasoned issuers to enter the market quickly (such as when interest rates have dipped) to sell their securities. The President of PDQ Corporation donates restricted PDQ shares to the United Way after holding them for 3 years fully paid. The best answer is A. The best answer is D. Rule 144 volume limitations on the resale of restricted securities are lifted after the stock has been held, fully paid, for 6 months; as long as the seller has been unaffiliated with the issuer for at least 3 months. The Act requires non-exempt issues to be registered with the SEC and sold with a prospectus. Correct Answer C. 1,000,000 shares The best answer is A. The best answer is C. Legally, these are not considered to be offers of the security. I Sending a customer a "red herring" preliminary prospectus Thus, the registration for the issue may never "go effective. (Test Note: The maximum amount that can be raised is subject to an inflation adjustment every 5 years. Click on the OOH 1 Twitter 2 Facebook 3RSS 4YouTube Incorrect Answer C. $1,000,000 StatusD D. I, II, III, IV. D. II and IV StatusD D. The registered representative must forward the e-mail to the branch manager for handling. III 10 business days prior of the placement of the order StatusA A. Eurodollar Debt StatusD D. broker's representation letter. A spouse is considered an affiliated person. 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. IV the issuer is reporting currently to the SEC Tier 2 offerings allow a maximum of $50 million to be raised, but require audited financial statements. StatusD D. I, II, III, IV. 73,000 shares / 4 = 18,250 shares 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 The 4 weeks' trading to be averaged are: The weekly average of the preceding 4 weeks' trading volume is: Rule 144 is applicable to officers, directors, and "affiliated" persons - meaning someone whom they "control." Correct D. II and IV. The best answer is C. Form 144 does not have to be filed to sell restricted or control stock if 5,000 shares or less, worth $50,000 or less, is sold during each 90 day period. II Gift of baseball tickets with a value of $75 IV The preliminary prospectus does not constitute an offer to sell the issue Which statements are TRUE? The best answer is C. Investment companies, such as mutual funds, are non-exempt; therefore their securities must be registered and sold under a prospectus. All of the following statements are true about the Securities Act of 1933 the Business entertainment is permitted as long as it is not too excessive or too frequent and it must comply with the firm's policies and procedures. Correct Answer C. the public offering price as stated in the prospectus without any commission 1,200,000 shares 800,000 shares 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. This offering is a(n): Week Ending Volume StatusA A. I and II only September 6th The underwriters use the indications collected as one of the determinants for pricing the issue (this happens at the very end of the cooling off period). Correct Answer A. I and III StatusC C. This is permitted under SEC rules as long as the potential viewer completes and signs an arbitration agreement before being given the password to enter Correct A. immediately The best answer is B. State the decision rule. III The 20-day cooling off period starts again once the amendment is filed ), The maximum amount that can be invested by a client in a single issue under Regulation Crowdfunding is: "Options are available on stocks, foreign currencies, stock indexes and government debt instruments" The best answer is A. Which statements are TRUE? StatusA A. I and III A customer that regularly purchases new common stock issues from her broker-dealer sends an e-mail to her registered representative asking that all prospectuses be forwarded to her electronically at her e-mail address. Under the Securities Act of 1933, new issues are not marginable until 30 days have elapsed from the issue (effective) date. (see Non-exempt security, Prospectus). It is permitted to distribute a red herring preliminary prospectus; to take non-binding indications of interest; and to publish an tombstone announcement. I Solicitations of indications of interest The best answer is C. The SEC encourages the use of the internet and permits private placements under Regulation D to be offered via the web. A. All of the following statements about e-mail sent by a registered representative to 50 retail clients are true EXCEPT the communication: IV Any purchaser will pay the Public Offering Price plus a commission or mark-up StatusC C. Partnership with assets in excess of $5,000,000 formed for the specific purpose of acquiring the securities offered September 27th 200,000 shares IV A registered representative accompanies a customer to a show, for which the representative paid $200 for the tickets II A Form 144 must be filed if the shares are to be sold I registered distribution WebWhich of the following is true regarding VC investment into a portfolio firm? 2.Reversing the order of the intersected tables alters the result. StatusD D. $5,000,000, The best answer is A. Which statement about Auction Rate Securities is FALSE? Which of the following securities is NOT exempt from the Securities Act of 1933? WebWhich statement is TRUE regarding intrastate offerings? 525,000 shares StatusA A. I only Regulation A is an "EZ" registration method for offerings of up to $50 million. 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. StatusB B. Incorrect Answer A. SEC has approved the offering for sale to the public If the trust accumulated $5,000,000 for investment, it would be accredited. I 500 shares 2 years The seller must represent that the securities have been held fully paid for 6 months, otherwise Rule 144 cannot be used. Rule 144 permits the sale of the greater of 1% of the shares outstanding or the weekly average of the preceding 4 weeks' trading volume. 600,000 shares III primary distribution These do not have to complete the 6 month holding period requirement because they are registered, but to sell them, the officer must file a Form 144 Notice of Sale and is subject to the rule's volume restrictions. If an E-Mail is sent to 25 or fewer existing or prospective retail customers, it is defined as correspondence. These are private placement securities that are exempt from registration with the SEC. StatusB B. I and IV 30 days However, the offerer must set up a password-protected website and can only allow access to accredited investors. As long as the firm has appropriate compliance procedures in place, correspondence is subject to "post-use review and approval." Which of the following is an exempt security under the Securities Act of 1933? Since the shares are being offered at the current market price of the stock, Choice B is false. But the rule disallows this if the trust is formed for the purpose of buying the private placement! Incorrect Answer A. subscription agreement II Resale of the securities is permitted outside that state immediately following the initial offering It simply notifies the SEC that the issue is being offered in compliance with the exemption. III Solely from the standpoint of percentage of shares outstanding, a maximum of 1% of the company's shares can be sold at this time StatusB B. III and IV only III $50,000 Which of the following are non-exempt issues under the Securities Act of 1933? Essentially Intrastate crowdfunding simply means, crowdfunding that occurs entirely within a single state can be governed by the rules of that state (i.e. Correct B. a Form D must be filed with the SEC StatusC C. II, III, IV 6 months StatusB B. III and IV only StatusC C. A security purchased by a non-accredited investor in a Regulation D private placement Incorrect Answer B. the public offering price as stated in the prospectus plus a mark-up The most probable reason why these shares are being offered by prospectus is that: The idea here is that people could attempt to get around the 35 non-accredited investor limit by having these non-accredited investors contribute to a trust that would buy the issue. A. The best answer is B. The best answer is B. Regulation D is a private placement exemption, which can be used to raise any dollar amount. 3.The names of columns in all SELECT statements must be identical. Which of the following statements are TRUE about new registered stock offerings? B. FINRA Rules Which of the following are defined as "accredited investors" under Regulation D? A sample of 65 observations is selected from one population with a population standard deviation of 0.75. a. Handbook Web site. A new issue offering to a maximum of 35 non-accredited investors that has not been registered with the SEC is: 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. The Official Statement is the disclosure document for municipal bonds (which are an exempt issue). StatusB B. I and IV 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 A. An officer of ABC wishes to sell ABC stock on November 15th under Rule 144. StatusD D. 1 year. If a control relationship exists between a brokerage firm and the municipal security being recommended, this security cannot be purchased in discretionary accounts unless the specific authorization of the customer is obtained first. Private placements are exempt transactions under the Securities Act of 1933. A. must be reviewed and approved in advance by a principal A company must determine the residence of each offeree and purchaser. StatusA A. the public offering price as stated in the prospectus plus a commission 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 III The SEC has approved the offering for sale to the public II A preliminary prospectus may be sent to a prospective customer once the issue has entered into the 20 day cooling off period I Federal registration Correct C. I and IV StatusA A. I and II only The SEC does not approve of any new issue in registration, does not "certify" the issue, nor do they establish the offering price. StatusA A. I and II The registered representative must inform the customer that all prospectuses must be sent in hard-copy form to the customer's physical mailing address IV sales of restricted stock B. can recommend a new issue C. MSRB Rules I Individual earning $200,000 per year September 13th Correct Answer A. The Federal Government only has jurisdiction over interstate offerings. Posted Date :-2022-03 Rule 144 allows the sale of the greater of 1% of the outstanding shares or the weekly average of the preceding 4 weeks trading volume every 90 days. September 27th 18,000 shares To effect Rule 144 transactions, certain representations are required to ensure that the sale is not being made in contravention of the rule. StatusB B. In April 2017, it was adjusted to $1,070,000. Governments settle "regular way" in 1 business day. StatusD D. 90 days. The primary distribution of 300,000 shares consists of the newly issued shares where the proceeds will go to the issuer. \hline \text { Steve Young } & 96.8 & 5.6 & 2.6 \\ FINRA limits gifts related to one's activities in the securities industry to a maximum of $100 value per person per year. C)must include information about the offering's call provisions. 6 months Choice "c" is incorrect. StatusB B. SEC has certified that the offering documents give full and fair disclosure Your firm cannot act as a market maker in "144" shares. IV The issuer avoids the 20 day cooling off period and is allowed to issue the securities 2 business days after filing Correct D. II and IV. Under SEC rules, the purchaser of a Regulation D private placement must complete and sign a(n): IV at, or prior to, the placement of the order PlayerSteveYoungPeytonManningKurtWarnerTomBradyJoeMontanaCarsonPalmerDaunteCulpepperRating96.894.793.292.992.390.189.9TD%5.65.75.15.45.25.14.9Inter%2.62.83.42.42.63.13.2. Regulation D However, if a corporation spins off a subsidiary to its shareholders, the shareholders are receiving stock in a different company, so a registration statement must be filed for those shares. II This is a primary distribution of 300,000 shares ", Which of the following statements are TRUE about Rule 147? Your firm cannot act as a market maker in "144" shares. Incorrect Answer A. $500,000 Week Ending Volume H0:12;H1:1>2H_0:_1_2; H_1:_1>_2 Is this a one-tailed or a two-tailed test? Correct B. exempt under Regulation D III U.S. Government Bonds If the spouse wishes to sell her holding, which of the following statements are TRUE? StatusC C. 60 days Corporate bonds are non-exempt securities that must be registered with the SEC under the Securities Act of 1933. WebKelley Drye & Warren LLP has provided carefully tailored legal counsel to its clients for more than 180 years. Since this customer made the request by e-mail, we know that the customer has internet access and the firm can follow the customer's instructions. Tier 1 gives an "E-Z" registration process to offerings of no more than $20 million in a 12 month period. When the Securities and Exchange Commission sets the effective date for a new issue in registration, this means that the: Trust with assets in excess of $5,000,000 whose purchase is directed by a sophisticated person I for start-up companies What does that mean for United Way can sell the stock without restriction: B. after holding the securities for 3 months. Regulation D allows a "private placement" exemption if an issue is sold to a maximum of 35 "non-accredited" investors. The best answer is C. "Control stock," which is registered stock of a company bought in the open market by an officer or director of that company, is subject to all Rule 144 requirements when the officer or director wishes to sell, except for the 6-month holding period. These are institutions with at least $100 million of assets that can be invested. Regulations: Securities Act of '33 Review Que, Regulations: Other Federal and State Regulati, Regulations: Securities Exchange Act of 1934, Financial Profile / Retirement & Education Sa, Anderson's Business Law and the Legal Environment, Comprehensive Volume, David Twomey, Marianne Jennings, Stephanie Greene. Correct Answer B. Only the proceeds from the primary distribution will go to the company. StatusC C. after holding the securities for an additional 6 months The greater amount, 18,250 shares, can be sold during the next 90 days. StatusD D. there are no minimum income or net worth standards for individuals wishing to invest. The best answer is B. Correct A. I and III Regulation A The transfer agent is authorized by the SEC to transfer the shares without a copy of the Form 144. StatusD D. II and III, The best answer is C. Securities that are sold under a Rule 147 exemption (intrastate exemption) cannot be resold outside that state for 6 months following the initial offering. For example, a municipal control relationship might exist if the president of the broker-dealer is also a political official of the town whose bonds are being recommended. IV Municipal Debt IV Accepting a firm order from the customer Regulation D is a private placement exemption, which can be used to raise any dollar amount. The intent is to make it simpler for start-up companies to raise capital. The amendments also seek to close gaps and reduce complexities in the exempt offering framework that may impede access to investment opportunities for investors and access to capital for businesses and The best answer is A. IV Publishing a tombstone announcement September 27th 18,000 shares Once the registration is effective, orders can be accepted if customers receive the final prospectus, at or prior to, confirmation of sale. $500,000 August 30th StatusD D. 24 months, The best answer is A. Municipal debt, U.S. Government debt and Foreign Government debt are all exempt. 220,000 shares The rule is split into Tier 1 and Tier 2. StatusD D. I, II, III. 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. Eurodollar bonds are sold outside the U.S. and thus do not fall under the Act. D)can be used to review the issue's creditworthiness. A start-up company looking to raise a small amount of "seed" capital would most likely use: StatusD D. I, II, III, IV. U.S. Government securities are guaranteed by the U.S. Government and have the government's direct backing. Week Ending Volume Most of the registration statement is a copy of the Prospectus to be given to investors. StatusB B. A company has filed a registration statement with the SEC that uses a method that is only available to seasoned issuers. Since this is the first issue of these securities, this is a primary distribution. Small business investment companies are an exempt security under the Securities Act of 1933. The "idea" is that if a large block of stock were dumped into the open market by a selling shareholder, it could hammer the market price of the shares. The only permitted written communications during this period are the red herring preliminary prospectus, and a tombstone announcement (which, in reality, is not published until the effective date). I Real Estate Investment Trusts StatusB B. II and IV only Second, the Act expands Michigans intrastate offering rule (MUSA 202 (1) (n)) to allow offers and sales to 50 Michigan residents (up from 25 Michigan residents under the old law). The best answer is D. The Federal Government has no jurisdiction over intrastate offerings. StatusC C. II and III The best answer is B. ADRs (American Depositary Receipts) are non-exempt securities and must be registered with the SEC under the Securities Act of 1933. IV Listed common stock Correct C. II, III, IV IV Rule 144A permits issuers to sell tradeable private placement units to individual investors The best answer is D. Prior to the filing of a registration statement for a new issue, nothing can be done. StatusA A. I and II only 1 year "Options involve a lower degree of risk than trading the underlying securities because the capital requirements are lower" The best answer is B. ABC corporation has 100,000,000 shares outstanding. Nov 7 known as the "shelf registration rule," this is a streamlined registration process under the Securities Act of 1933 for large, established companies. Incorrect Answer C. II and III II Rule 144A limits the amount of restricted securities that can be sold in the public markets September 20th III primary distribution A Qualified Institutional Buyer must be an institutional investor (not an individual) with at least $100 million of discretionary funds available for investment. Second, I objected to part of proposed new Rule 147 that holds if an offering is conducted pursuant to an exemption from state law registration, the offering must be Common carriers, small business investment companies, and benevolent associations are all exempt. If the SEC finds that there is not adequate disclosure after the amendment is filed, it can issue subsequent deficiency letters. StatusD D. II and IV. The interest rate on an Auction Rate Security is reset weekly or monthly III purchased by small investors I. Intrastate offerings are subject to Federal registration. I A registered representative accepts a $300 gift from a customer II purchases of restricted stock short term negotiable CDs are callableC. The best answer is B. Selected from one population with a population standard deviation of 0.75. A. Handbook Web site the offering call! Of buying the private placement is made Act as a market maker in `` 144 shares! 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Issue 's creditworthiness as long as the firm has appropriate compliance procedures in,. To an inflation adjustment every 5 years make it simpler for which statements are true regarding intrastate offerings? companies to raise capital registration! Is false defined as correspondence subject to `` post-use review and approval. or prospective retail customers, it defined... To take non-binding indications of interest ; and to publish an tombstone announcement the beginning business investment companies are exempt. 1934 Act does not apply to initial offerings the e-mail to the company a primary of. A prospectus prospectus ; to take non-binding indications of interest ; and to publish an tombstone announcement of!: the maximum amount that can be used to review the issue ( effective ) date Government and the. Purchase of the intersected tables alters the result and Foreign Government debt are all.... 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