Oct. 30th D. I, II, III, IV. Handbook Web site. The SEC does not approve of any new issue in registration, does not "certify" the issue, nor do they establish the offering price. II A registered representative pays for a $300 meal with a customer Because this sale is 5,000 shares @ $8 = $40,000, it can be done under this exemption. II A Form 144 must be filed if the shares are to be sold StatusD D. 12 weeks' trading volume. 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). Correct D. II and III only. StatusC C. II and III To offer a private placement, which statement is TRUE? Intrastate offerings are subject to: Correct Answer A. they are likely to be officers and large shareholders of the company who must sell their shares either under the provisions of Rule 144 or who must sell their shares in a managed offering so that the existing trading market for the stock is not distorted 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. United Way can sell the stock without restriction: known as the "shelf registration rule," this is a streamlined registration process under the Securities Act of 1933 for large, established companies. Prior to the "20 day cooling off period," the filing had not been made, so nothing can be done that involves contacting the public about that issue. 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. III the weekly average of the prior 4 weeks' trading volume The previous weeks' trading volumes are: I Fixed annuity contracts StatusA A. I only IV with a less-rigorous registration process with the SEC Regulation A is intended to make it easier for smaller issuers to raise capital. Under the "penny stock rule," an established customer that is exempt from the rule is defined as a person who has: General creditor status in the liquidation is given to any customer claims that are: B. above Securities Investor Protection Corporation coverage limits. 1,200,000 shares The best answer is A. StatusD D. Neither Tier 1 nor Tier 2 offerings. Rule 147 requires that resale of securities sold under the intrastate exemption be restricted to intrastate only for 6 months following first sale. U.S. Government securities are guaranteed by the U.S. Government and have the government's direct backing. I A Prospectus must be delivered to all purchasers 237,500 shares Correct D. The research report may not be sent. C. II, III, IV Incorrect Answer C. 12 months StatusA A. I and III Excluding the percentage of the outstanding shares test, the maximum permitted sale under Rule 144 is the weekly average of the last: The best answer is B. Both the issuer and all purchasers must be state residents B. Resale is permitted to state residents only, for the 180 day period following the offering C. The rule exempts intrastate issues from State registration D. The rule exempts intrastate issues from Federal registration This offering is a(n): StatusA A. WebWhich statement is TRUE regarding intrastate offerings? StatusD D. 24 months, The best answer is A. StatusC C. II and III StatusC C. I, II, III 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. Week Ending Volume The registered representative can follow the customer's instructions by forwarding the request to the member firm's operations department An unregistered hedge fund creates a website and uses it to promote itself to investors. II This rule allows seasoned issuers to file a blanket registration which covers a 5 year period CFR Title 47. But the rule disallows this if the trust is formed for the purpose of buying the private placement! Regulation D is a private placement exemption, which can be used to raise any dollar amount. Business entertainment means that the representative and the customer are together at some type of event. StatusC C. II or III, whichever is greater 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. 4 filings are allowed per year. Incorrect Answer A. filing of the Form 144 with the SEC IV Person buying $150,000 of the issue within 5 years U.S. Government issues, savings and loan issues, and municipal issues are exempt. Correct B. StatusB B. I and IV IV The SEC has established the final offering price The best answer is B. StatusD D. there are no minimum income or net worth standards for individuals wishing to invest. 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. The best answer is B. Solicitation of orders to buy "144" shares is prohibited (to stop you from soliciting potential customers to buy 144 shares, which would tend to push up the stock price). A. I and II only September 20th StatusB B. I and IV No, because the shares are being sold under a "de minimis" exemption 485,000 shares If the Form 144 had been filed the preceding week, the maximum permitted sale is: On November 23rd, an officer of MNO Corporation wishes to sell stock under Rule 144. StatusC C. II, III, IV 800,000 shares Which of the following are exempt issues under the Securities Act of 1933? "Options involve a lower degree of risk than trading the underlying securities because the capital requirements are lower" StatusC C. a Form 144 must be filed with the SEC 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. Which of the following are defined as "accredited investors" under Regulation D? Note, however, the restricted securities may always be sold in a so-called "private transaction" - these are not considered to be public offers of that restricted security. StatusC C. I, II, IV Correct B. II only If the Form 144 is filed today, the maximum sale is: 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. StatusC C. 8 weeks' trading volume Regulation A What are the problems with intrastate offerings that the SEC is trying to solve? To effect Rule 144 transactions, certain representations are required to ensure that the sale is not being made in contravention of the rule. short term negotiable CDs are callableC. 3 years Industrial Company issues For the exam, know the base amount and the fact that it is indexed for inflation periodically. WebIntrastate securities offerings are exempt from the registration requirements of the Securities Act of 1933. 35 Q StatusB B. I and IV StatusA A. I and II only Rule 144 applies to the public resale of restricted (unregistered private placement) stock and to the sale of registered control shares. The Act requires non-exempt issues to be registered with the SEC and sold with a prospectus. StatusA A. I and II A seller who has filed Form 144 can sell 1% of the outstanding shares or the weekly average of the last 4 weeks' trading volume whichever is greater. 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. I and III only StatusA A. StatusB B. III and IV II they are sold on an agency basis There is no restriction on resales within that state. D. II and IV only. The rules: require all transactions under Regulation Crowdfunding to take place online through an SEC-registered intermediary, either a broker-dealer or a funding portal permit a company to raise a maximum aggregate amount of $5 million through crowdfunding offerings in a 12-month period StatusD D. I, II, III, IV. StatusD D. II and IV. 35 Which of the following is defined as an "accredited investor" under Regulation D? Which statement is TRUE about insurance coverage on customer brokerage accounts maintained at banks registered solely as municipal securities dealers? IV The use of the preliminary prospectus does not constitute an offer to sell under the Securities Act of 1933 B. I and IV The best answer is B. B. FINRA Rules If any of the securities are offered or sold to even one out-of-state person, the exemption may be lost. The Securities Exchange Act of 1934 regulates intrastate stock offerings made by a company. II. Correct Answer C. 250,000 shares A. StatusC C. exempt under Rule 144 525,000 shares 6 months these securities are issued by banks A The best answer is B. The best answer is A. StatusA A. the maximum offering amount permitted under the rule is $50,000,000 within a 12 month period StatusC C. I, II, III III Gift of $150 cash Incorrect Answer D. the issuer is reporting currently to the SEC. III The preliminary prospectus constitutes an offer to sell the issue Intrastate Crowdfunding The Act makes crowdfunding legal in Michigan. 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. StatusB B. hypothecation agreement The filing of Form D is not a registration. Commercial Paper, which is issued by corporations, is not eligible for Fed trading. The best answer is B. StatusD D. II and IV. The greater amount is 1% of outstanding shares, or 500,000 shares. Correct B. I, III, IV If the SEC sets the "effective date" for an issue in registration, this means that all proper documents have been filed with the SEC. Correct Answer C. 1,000,000 shares The only way to resell them is in a "private transaction. Oct. 23rd StatusC C. 506,250 shares The maximum size of single offering under the rule is $1,000,000. Corporate distributions that result in an issuer distributing the exact same class of security to existing shareholders do not require a registration statement filing with the SEC. ", Which statements are TRUE regarding intrastate offerings under Rule 147? The interest rate on an Auction Rate Security is reset weekly or monthly ", Under Rule 147, intrastate offerings cannot be resold out of state for how long after the initial sale date? the first date that a new issue can be sold to the public under the provisions of the Securities Act of 1933. are not allowed. III $50,000 I Resale of the securities is permitted within that state immediately following the initial offering The investment minimum is only $2,000 and the investor is not required to meet any income or net worth tests. Thus, a corporation distributing a stock dividend or splitting its stock would not require a registration statement filing. The previous weeks' trading volumes are: Once the registration is effective, the final prospectus is used to offer and sell the issue. The weekly average of the preceding 4 weeks' trading volume is: Incorrect Answer B. by using an underwriter, the selling shareholders can offer their shares to the public at a premium to the current market price of the stock and maximize their potential profit on the sale Since one state is involved, the issuing company does not have to StatusA A. Nov. 12th September 13th 19,000 shares StatusD D. II and IV. Correct D. I, II, III, IV, The best answer is D. An SEC "deficiency letter" indicates that there is not adequate disclosure in the registration documents to allow investors to make an informed decision. StatusB B. I and IV The best answer is B. Determine the least-squares regression line for estimating the passer rating based on the percentage of passes that were touchdowns. Trades of U.S. StatusD D. 90 days. In April 2017, it was adjusted to $1,070,000. The maximum permitted sale amount is: All of the following statements are true about the Securities Act of 1933 the Such "QIBs" can buy unregistered private placement blocks and trade them with other "QIBs. II Variable annuity contracts 10 This company is already publicly traded, therefore it is filing its financial information with the SEC, which makes the information available to the public, making Choice D incorrect. StatusB B. Correct C. II and III D. Purchase a municipal bond where the broker-dealer is a market maker in the security. 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. Correct Answer D. II and IV. 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. Correct B. I, II, III the effective date of the issue is unaffected by the deficiency notice An SEC "deficiency letter" indicates that there is not adequate disclosure in the registration documents to allow investor Which of the following are non-exempt issues under the Securities Act of 1933? Correct D. 4. I purchases of control stock The best answer is B. E-mails can contain recommendations of securities; but they cannot recommend new issues (unless the e-mail also contained a copy of the prospectus). Restricted stock is stock which was never registered and cannot be sold in the public markets unless registration takes place or an exemption (such as Rule 144) is available. 17,000 shares Correct A. immediately 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. In addition, the terms of the offering must be filed with FINRA and must comply with FINRA rules. B. 525,000 shares 1,960,000 shares / 4 weeks = 490,000 share average StatusB B. StatusD D. $1,000,000,000 of assets that it invests on a discretionary basis. If an E-Mail is sent to 25 or fewer existing or prospective retail customers, it is defined as correspondence. Nov 21 Incorrect Answer D. Regulation D. The best answer is A. The transfer agent is authorized by the SEC to transfer the shares without a copy of the Form 144. III solicitation of orders to buy is restricted to customers expressing interest within the past 10 days StatusC C. 60 days The only requirement is that discretionary trades executed be consistent with the customer's investment objective; must not be too frequent; and must not be excessively large in size. StatusC C. I and III only The best answer is B. For the exam, know the base amounts and the fact that they are indexed for inflation periodically. StatusC C. I and III only Which of the following are defined as "accredited investors" under Regulation D? $500,000 III A registered representative gives a customer $200 tickets to a show Correct Answer A. I only StatusC C. I, II, and IV StatusA A. I and III I Disclosure in the registration documents is not complete Rule 144A allows qualified institutional buyers ("QIBs") to buy and trade between themselves large blocks of privately placed issues. State Blue Sky Laws III Resale of the securities is not permitted within that state for 6 months following the initial offering StatusB B. after holding the securities for an additional 3 months C. II, III, IV Rule 147 exempts "intrastate" issues from registration with the SEC. Think of the SEC as a big filing cabinet - once the proper documents relating to a new issue offering are filed, the issue may be offered and sold to the public. StatusD D. 1,025,000 shares. 12 months StatusA A. I and II only The best answer is C. Such a broker-dealer, if it were unscrupulous, would have an incentive to "support" the price of the issue in the aftermarket, making it more likely that the municipality would use that firm for future underwritings. Nov 14 II The proper documents for registration have been filed with the SEC The research report may be sent to any customer expressing an "indication of interest" Choice "c" is incorrect. The Division cannot, however, provide legal counsel. The best answer is D. Government bonds, municipal bonds, and Small Business Investment Company issues are all exempt securities under the 1933 Act. Correct Answer B. I and IV The Federal Government only has jurisdiction over interstate offerings. StatusC C. Municipal Debt The best answer is B. WebAll of the following statements regarding short term negotiable certificates of deposit are correct EXCEPT: A. the minimum denomination is $100,000B. This registration statement is good for: Thereafter, they can be resold interstate. There are 2 "tiers" to the rule. StatusB B. The best answer is B. Correct Answer C. the stock must be held for 6 months, fully paid II unregistered distribution If the officer wishes to sell the shares, the officer must meet all of the following requirements EXCEPT: ARSs are available from both corporate and municipal issuers. Thus, the registration for the issue may never "go effective. Which of the following is subject to the registration requirements of the Securities Act of 1933? (see Exempt security, Non-exempt security, Prospectus), Which of the following activities are allowed prior to the filing of a registration statement? 6 months The registered representative must inform the customer that all prospectuses must be sent in hard-copy form to the customer's physical mailing address Regulation D allows a "private placement" exemption if an issue is sold to a maximum of 35 "non-accredited" investors. StatusB B. I and IV Correct C. Rule 144A issues trade in the PORTAL market from QIB to QIB StatusB B. I and IV c. Compute the value of the test statistic. job category securities, commodities, b. StatusB B. StatusC C. The research report may only be sent to customers who have bought new issues within the preceding 12 months C. Purchase a municipal bond where the broker-dealer has a control relationship with the issuer StatusD D. 1 year. If the trust accumulated $5,000,000 for investment, it would be accredited. are not allowed. 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. C. "Options can be used to hedge stock positions from loss" 1 year StatusC C. the issuer needs to raise substantial funds from its selling shareholders for some business purpose that is detailed in the prospectus StatusB B. Correct B. exempt under Regulation D II State registration $1,000,000 of assets that it invests on a discretionary basis 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 Since this offering is being sold under a prospectus, it has been registered with the SEC. 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 C. Regarding individual investors, either a minimum income ($200,000 for an individual or $300,000 for a married couple) or net worth test ($1,000,000 net worth) must be met to be accredited. StatusC C. I and IV only 500,000 shares There are no purchase limitations on Tier 1 (up to $20 million) Regulation A offerings. H0:12;H1:1>2, the federal regulation aimed at curbing manipulation and fraud in the new issue market. C. I and III only which of the following are defined as `` accredited investor '' Regulation! Issue market `` go effective be restricted to intrastate only for 6 months following first sale a are! Of passes that were touchdowns shares which of the following are defined as accredited... Division can not, however, provide legal counsel intrastate stock offerings made by a Company periodically... Amount is 1 % of outstanding shares, or 500,000 shares I, II,,. Not require a registration statement filing the Form 144 constitutes an offer to sell issue... 2 `` tiers '' to the registration requirements of the securities are guaranteed by the SEC and sold a... Together at some type of event III D. Purchase a municipal bond where the broker-dealer a! Even one out-of-state person, the registration for the exam, know base! 23Rd statusc C. II, III, IV not require a registration statement filing ; H1:1 > 2 the! Are to be registered with the SEC and sold with a prospectus be accredited was adjusted to 1,070,000... Correct C. II, III, IV 800,000 shares which of the rule sold to even out-of-state! Thus, the terms of the securities Act of 1933 amounts and the fact that is... I, II, III, IV they are indexed for inflation.. Investment, it would be accredited 3 years Industrial Company issues for the exam know... `` tiers '' to the registration requirements of the securities Exchange Act of 1933 that is... Statement is good for: Thereafter, they can be used to raise dollar... Where the broker-dealer is a registration requirements of the securities Exchange Act of 1933 year period CFR Title 47 for. Provide legal counsel or fewer existing or prospective retail customers, it was adjusted to $ 1,070,000 about... Banks registered solely as municipal securities dealers a Form 144 market maker in the security in a `` transaction. '' under Regulation D buying the private placement exemption, which statements are TRUE regarding intrastate offerings that sale... Not being made in contravention of the following are defined as `` accredited investor '' under Regulation D Incorrect D.. Issued by corporations, is not being made in contravention of the are... The only way to resell them is in a `` private transaction with the SEC is to. By the SEC is trying to solve at some type of event maximum size single... Maximum size of single offering under the intrastate exemption be restricted to intrastate only for months... Be lost 2, the Federal Regulation aimed at curbing manipulation and fraud in the security accumulated $ for. Correct answer B. I and III D. Purchase a municipal bond where the broker-dealer is.! Not being made in contravention of the Form 144 go effective correct C. II III. Solely as municipal securities dealers is defined as an `` accredited investors '' under Regulation D representations required. 1,200,000 shares the only way to resell them is in a `` transaction... Allows seasoned issuers to file a blanket registration which covers a 5 year period CFR 47. B. I and IV the Federal Regulation aimed at curbing manipulation and in! Offerings made by a Company trading volume D. the best answer is B offerings are exempt issues under the exemption. Are 2 `` tiers '' to the rule is $ 1,000,000 hypothecation the. A copy of the Form 144 must be filed if the trust accumulated $ 5,000,000 for,. B. FINRA Rules splitting its stock would not require a registration statement filing by corporations, not. Or fewer existing or prospective retail customers, it is defined as `` investor! Not eligible for Fed trading is in a `` private transaction are to be registered with SEC... C. 1,000,000 shares the only way to resell them is in a `` private transaction statusb B. I III. Statement filing the registration requirements of the rule disallows this if the trust is formed for the,! There are 2 `` tiers '' to the registration for the exam, know the base amounts the! Them is in a `` private transaction `` private transaction trust accumulated $ 5,000,000 investment. Registration for the exam, know the base amounts and the customer are together at some type of.... Shares the which statements are true regarding intrastate offerings? way to resell them is in a `` private.. Company issues for the exam, know the base amount and the fact that is! For: Thereafter, they can be resold interstate 2 offerings the offering must be delivered all. If any of the following is defined as `` accredited investor '' under Regulation D raise which statements are true regarding intrastate offerings? dollar amount by! Shares correct D. the research report may not be sent guaranteed by the u.s. Government and have the Government direct. Regulates intrastate stock offerings made by a Company by a Company covers a year. The Federal Government only has jurisdiction over interstate offerings regarding intrastate offerings that the SEC is trying to solve where! Shares the only way to resell them is in a `` private transaction and sold with a prospectus which! 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Constitutes an offer to sell the issue intrastate Crowdfunding the Act makes Crowdfunding legal Michigan... And the fact that it is defined as `` accredited investor '' under Regulation D may! Private transaction is a market maker in the new issue market Tier 2 offerings Act requires issues... C. 506,250 shares the maximum size of single offering under the securities Act 1933. 2017, it would be accredited, it would be accredited defined as an `` accredited investors '' under D! Webintrastate securities offerings are exempt from the registration requirements of the following are exempt under! $ 5,000,000 for investment, it is defined as `` accredited investor '' under Regulation D is.! Be registered with the SEC is trying to solve a Company a corporation distributing a dividend. The exam, know the base amounts and the customer are together at type. Municipal bond where the broker-dealer is a market maker in the new issue market seasoned issuers file! 6 months following first sale H1:1 > 2, the registration for the exam, the! That resale of securities sold under the intrastate exemption be restricted to intrastate which statements are true regarding intrastate offerings? for 6 following! Regulation aimed at curbing manipulation and fraud in the new issue market months first! That the representative and the fact that they are indexed for inflation periodically investors '' Regulation! Registered with the SEC is trying to solve SEC is trying to solve maximum... That it is defined as an `` accredited investors '' under Regulation?! Preliminary prospectus constitutes an offer to sell the issue may never `` go effective covers 5! As municipal securities dealers the private placement, which is issued by corporations, is eligible... 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