Note 10 - note PDF

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The "access equals delivery" rule that permits electronic delivery of a prospectus (instead of paper) to those customers that have internet access is permitted for all securities offerings with the exception of investment company issues. For example, the purchaser of a mutual fund must still get a paper prospectus.

Excluding the trading volume test, how much of the issuer's outstanding shares can be sold every 90 days under Rule 144 a. 1% b. 5% c. 10% d. 25% - 1%

Excluding the trading volume test, how much of the issuer's outstanding shares can be sold every 90 days under Rule 144? A. 1% B. 5% C. 10% D. 25% - 1%

Exempted issuers are defined under the: A. Securities Act of 1933 B. Securities Exchange Act of 1934 C. Trust Indenture Act of 1939 D. Investment Company Act of 1940 - Securities Act of 1933

The Securities Act of 1933 defines exempt issuers and exempt transactions. If an issuer is exempt or if a new non-exempt issue is sold in an exempt transaction, that new issue does not have to be registered under the Act. Otherwise, registration is required.

If the SEC sends a deficiency letter to the issuer regarding an issue in registration, which of the following statements are TRUE? I. Disclosure in the registration documents is not complete

II. The issuer must file an amendment with the SEC to cure the deficiency III. The 20-day cooling off period starts again once the amendment is filed IV. The SEC can issue subsequent deficiency letters after amendments are reviewed - All of them

An SEC "deficiency letter" indicates that there is not adequate disclosure in the registration documents to allow investors to make an informed decision. The deficiency must be cured before the SEC will allow the registration to be effective. Once the amendment is filed, the 20-day cooling off period starts counting again from the beginning. If the SEC finds that there is not adequate disclosure after the amendment is filed, it can issue subsequent deficiency letters. Thus, the registration for the issue may never "go effective."

If the SEC sends a deficiency letter to the issuer regarding an issue in registration,: A. it disapproves of registering the issue B. disclosure is not considered to be adequate C. the underwriters have failed to establish the Public Offering Price D. due diligence has not been performed by the underwriters - disclosure is not considered to be adequate

An SEC "deficiency letter" indicates that there is not adequate disclosure in the registration documents to allow investors to make an informed decision. The deficiency must be cured before the SEC will allow the registration to be effective.

If the SEC sends a deficiency letter to the issuer regarding an issue in registration: a. it disapproves of registering the issue b. disclosure is not considered to be adequate c. the underwriters have failed to establish the Public Offering Price d. due diligence has not been performed by the underwriters - disclosure is not considered to be adequate

If the Securities and Exchange Commission sets the effective date for a new issue in registration, which of the following statements are TRUE? I. All proper documents have been filed with the SEC II. Additional documents must be filed with the SEC

III. The SEC approves of the new issue IV. The issue may be offered to the public - All proper documents have been filed with the SEC The issue may be offered to the public

If the SEC sets the "effective date" for an issue in registration, this means that all proper documents have been filed with the SEC. The SEC does not approve (nor does it disapprove) of any new issue in registration. Once the proper documents relating to a new issue offering are filed, the issue may be offered to the public.

In order to sell restricted stock under the provisions of Rule 144, the stock must be: I. fully paid II. either properly margined or fully paid III. held for at least 6 months IV. held for at least 1 year - fully paid held for at least 6 months

Intrastate offerings are exempt from: I. Federal registration II. State registration III. FINRA regulation - Federal registration

Intrastate offerings are exempt from SEC registration, but are still subject to registration within the state where the offer is being made. In addition, the terms of the offering must be filed with FINRA and must comply with FINRA rules.

Regulation Crowdfunding is intended as a means of raising capital: I. for start-up companies II. for established companies III. with no registration with the SEC IV. with a less-rigorous registration process with the SEC - for start-up companies with no registration with the SEC

Restricted securities can be sold under Rule 144 if: I. they are sold on a dealer basis II. they are sold on an agency basis III. solicitation of orders to buy is restricted to customers expressing interest within the past 10 days IV. the issuer is reporting currently to the SEC - they are sold on an agency basis solicitation of orders to buy is restricted to customers expressing interest within the past 10 days the issuer is reporting currently to the SEC

Restricted shares subject to sale under Rule 144 are most commonly acquired through: a. private placements b. registered secondary distributions c. tender offers d. ESOPs (Employee stock ownership plans) - private placements

Rule 144A applies to trading of: A. restricted stock in the open market B. private placements by qualified institutional buyers C. restricted stock in a private securities transaction D. private placements by individuals - private placements by qualified institutional buyers

The Chief Executive Officer of PDQ Company is married and has a husband who owns 5% of the common equity of PDQ. Which of the following statements are TRUE regarding the husband and his PDQ stock holdings? I. The husband is considered to be an "affiliate" under Rule 144 II. The husband is not considered to be an "affiliate" under Rule 144 III. To sell PDQ securities, the husband must file a Form 144 IV. To sell PDQ securities, the husband is not required to file a Form 144 - The husband is considered to be an "affiliate" under Rule 144 To sell PDQ securities, the husband must file a Form 144

The final prospectus for a new registered securities issue: I. contains the Public Offering Price II. does not contain the Public Offering Price III. must be given to the customer at, or prior to, confirmation of sale IV. must be given to the customer at, or prior to, settlement of the transaction - contains the Public Offering Price must be given to the customer at, or prior to, confirmation of sale...