Correct Answer A. I only StatusC C. 1 year The best answer is B. The best answer is D. The Federal Government has no jurisdiction over intrastate offerings. 450,000 shares All of the following statements are true about the Securities Act of 1933 the 280,000 shares StatusA A. I and II only An unregistered hedge fund creates a website and uses it to promote itself to investors. StatusB B. Under Rule 147, intrastate offerings cannot be resold out of state for how long following completion of the initial offering? The last 4 weeks' trading volumes are: 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. Business entertainment does not fall under the $100 gift limit. StatusD D. Regulation D. The best answer is C. An abbreviated registration statement is filed with the SEC (Form S1-A) and the issue must go through a 20 day review period, similar to a regular registered offering. The secondary distribution consists of the 200,000 shares being sold by officers (who are "tacking on" their shares to the primary distribution to avoid having to resell the shares under Rule 144 restrictions). B. FINRA Rules Once the registration is effective, the final prospectus is used to offer and sell the issue. IV The preliminary prospectus does not constitute an offer to sell the issue II Variable annuity contracts 17,000 shares Resale is restricted to state residents for 6 months following the offering; thereafter, the issue can be sold interstate. Nov 14 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. III Both the issuer and all purchasers must be state residents III The SEC has approved the offering for sale to the public Choice A would not be considered to be a control relationship because the broker-dealer is not involved in a relationship with the issuer - rather the firm is simply trading the bonds in the secondary market. An officer of a company has acquired shares of that issuer in the open market. Correct B. I and IV To obtain the 147 exemption, both the issuer and the purchaser must be state residents. The 6-month holding period is required for restricted stock, but not for control stock. If an issuer complies with all of the provisions of Rule 147, then the issuer will be deemed to have complied with Section 3 (a) (11). Rule 147 requires that resale of securities sold under the intrastate exemption be restricted to intrastate only for 6 months following completion of the initial offering. WebIntrastate Crowdfunding (RCW 21.20.880 to .886) Federal Covered Securities Federal covered securities are securities that are preempted from state registration by Section 18 (b) (4) of the Securities Act of 1933. Eurodollar bonds are sold outside the U.S. and thus do not fall under the Act. StatusC C. II and III StatusA A. StatusC C. 8 weeks' trading volume I by the seller of the restricted shares H0:12;H1:1>2H_0:_1_2; H_1:_1>_2 October 4th 16,000 shares This client cannot make the investment because the dollar amount to be invested is too small IV Resale is permitted to state residents only, for the 180 day period following the offering StatusD D. any price since this is a negotiated market offering. The President of PDQ Corporation buys PDQ shares in the open market. A. municipal broker-dealer always makes a market in the municipality's securities that are being recommended Nov. 5th An officer of ABC wishes to sell ABC stock on November 15th under Rule 144. Which of the following are defined as "accredited investors" under Regulation D? Incorrect Answer C. II and III C. I and III only Correct D. I, II, III, IV. IV secondary distribution Week Ending Volume D. II and IV StatusB B. after holding the securities for 90 days September 6th StatusC C. Small Business Investment Company issues B. Correct A. I and III Note, however, that because these securities were never registered with the SEC, they cannot be publicly traded. 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. StatusD D. II and IV, The best answer is C. Under Regulation D, purchasers of private placements must be given full disclosure about the issue, even though no prospectus is required (the issue is exempt). IV Publishing a tombstone announcement The maximum amount that can be invested in a single offering under Regulation Crowdfunding is $100,000. Correct A. StatusD D. broker's representation letter. B. StatusA A. Which of the following securities are NOT required to be registered with the SEC? StatusA A. Correct C. $1,000,000 III U.S. Government Bonds 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 3.The names of columns in all SELECT statements must be identical. StatusD D. 18,500 shares. I Federal registration Click on the OOH now to prepare yourself to pursue the Oct. 23rd ", Under Rule 147, intrastate offerings cannot be resold out of state for how long after the initial sale date? 30 days 2 StatusD D. I, II, III, IV, The best answer is B. 2.Reversing the order of the intersected tables alters the result. This is prohibited under SEC rules September 13th Nov. 5th Which statement is TRUE? No specific authorization is needed to buy securities for a discretionary customer account where the firm is a market maker in the security - no control relationship exists with the issuer in this case. A sample of 65 observations is selected from one population with a population standard deviation of 0.75. Whereas normal private placements cannot be traded, these can be traded from QIB to QIB. StatusC C. II and III Correct B. buyer's representation letter The effective date occurs once the 20-day cooling off period has elapsed without a deficiency notice being sent by the SEC to the issuer of the securities. Nov 21 Once the registration statement is filed, the issue enters the 20-day cooling off period. This market is not available to individuals. II The issuer must file an amendment with the SEC to cure the deficiency The best answer is C. If the SEC sets the "effective date" for an issue in registration, this means that all proper documents have been filed with the SEC. StatusB B. These are private placement securities that are exempt from registration with the SEC. \text { Carson Palmer } & 90.1 & 5.1 & 3.1 \\ September 13th 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. The best answer is A. Correct B. This gives the issuer the advantage of paying a short-term market interest rate on a long-term security. Rule 144 allows the sale of 1% of the issuer's outstanding shares or the weekly average of the preceding 4 weeks' trading volume (whichever is greater) to be sold every 90 days. A start-up company looking to raise a small amount of "seed" capital would most likely use: Webanswer questions of a general nature regarding the registration process or exemptions from registration. Correct B. during the 20 day cooling off period StatusB B. II and IV (see Regulation D), Which of the following are accredited investors? Intrastate offerings are exempt from the Securities Act. StatusA A. A non-profit organization, trust, or institutional investor is accredited if it has at least $5,000,000 of assets and was NOT formed with the intent of buying the private placement. Which statements are TRUE? a one-page report about this area of 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 capitalization of $75 million. The best answer is D. Government bonds, municipal bonds, and Small Business Investment Company issues are all exempt securities under the 1933 Act. Municipal debt, U.S. Government debt and Foreign Government debt are all exempt. 250,000 shares For the exam, know the base amounts and the fact that they are indexed for inflation periodically. The previous weeks' trading volumes are: September 13th 19,000 shares StatusB B. II and IV StatusA A. The best answer is B. StatusD D. 280,000 shares. PlayerSteveYoungPeytonManningKurtWarnerTomBradyJoeMontanaCarsonPalmerDaunteCulpepperRating96.894.793.292.992.390.189.9TD%5.65.75.15.45.25.14.9Inter%2.62.83.42.42.63.13.2. StatusA A. seller's representation letter A small investor with $2,000 of available funds wishes to make a crowdfunding investment. This amount can be sold every 90 days (every 3 months), so a sale can occur 4 times per year. an "E-Z" registration process under the Securities Act of 1933 that permits a non-exempt issuer to issue up to $50,000,000 worth of securities each year. B. can recommend a new issue \text { Peyton Manning } & 94.7 & 5.7 & 2.8 \\ stock, usually issued directly to the officers or directors of a corporation in a private placement, that has not been registered with the SEC. I American Depositary Receipts However you are allowed to recontact individuals expressing buying interest in "144" transactions within the past 10 days. The maximum size of single offering under the rule is $1,000,000. StatusC C. II and III II The preliminary prospectus may not be sent to a potential customer prior to that customer expressing an indication of interest Conclude your report A: Intrastate offerings are subject to federal registration only B: Intrastate offerings are exempt from state The intent is to make it simpler for start-up companies to raise capital. StatusB B. II only Statement A is untrue - options have greater risk than the underlying securities because they are more volatile and lose time value each day. IV at, or prior to, the placement of the order Disclosure is accomplished by providing the purchaser with a copy of an "Offering Circular," which for smaller private placements is called the "Offering Memorandum.". The issue must also be registered in the state(s) where it will be offered. WebAll of the following statements are true about Rule 147 EXCEPT: A. Which of the following is defined as an "accredited investor" under Regulation D? "Options are available on stocks, foreign currencies, stock indexes and government debt instruments" Once the "shelf" filing is made, by giving 2 days' notice to the SEC, the issuer can sell new securities in the market. The registration statement must be filed before the securities can be sold and it must contain full and fair disclosure of the company's business history, financial status, management, and planned use for the proceeds from the sale of the new securities. Incorrect Answer D. No, because the shares are not restricted. (b) Describe its shape (skewed left, symmetric, skewed right). ), The maximum amount that can be raised by an issuer under Regulation Crowdfunding is: StatusC C. the issuer needs to raise substantial funds from its selling shareholders for some business purpose that is detailed in the prospectus IV Resale of the securities is not permitted outside that state for 6 months following the initial offering II Treasury Bills The best answer is B. Restricted stock is best described by which of the following? Correct C. II and III 45 days A director of a publicly held company wants to sell 5,000 registered shares of that company's stock at $8 per share that she has held for 3 months. StatusC C. I and III only III A registered representative gives a customer $200 tickets to a show I The spouse is considered to be an affiliated person subject to Rule 144 The Securities Exchange Act of 1934 consists of a variety of rules covering the trading (secondary) market. StatusD D. II and IV. Since one state is involved, the issuing company does not have to III Intrastate offerings are exempt from Federal registration 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. It requires the registration of broker-dealers and self-regulatory organizations (the exchanges). If a corporation merges with another publicly held company, a new corporation is being created, and a registration statement must be filed as well. To document that the purchasers are, indeed, accredited, an "accredited investor questionnaire" must be completed and signed by the potential purchaser. The SEC encourages the use of the internet and permits private placements under Regulation D to be offered via the web. ABC corporation has 100,000,000 shares outstanding. 1% of 1,800,000 shares = 18,000 shares. The research report may be sent to any customer expressing an "indication of interest" The best answer is C. StatusB B. II and IV I Real Estate Investment Trusts For the exam, know the base amount and the fact that it is indexed for inflation periodically. Oct 31 StatusC C. The client cannot make the investment because the offering is only available to institutional investors The company has 1,800,000 shares outstanding. StatusA A. I and III II Any purchaser who received a preliminary prospectus need not receive the final prospectus Retail communications must be approved in advance by a principal. Yes, because any sale of shares by a director requires the filing of a Form 144 WebIntrastate securities offerings are exempt from the registration requirements of the Securities Act of 1933. Correct B. are not allowed. Additional commissions or charges above the P.O.P. Which statement is TRUE? Additional commissions or charges above the P.O.P. Sell covered calls StatusC C. 3 StatusC C. Partnership with assets in excess of $5,000,000 formed for the specific purpose of acquiring the securities offered Sell naked calls The best answer is B. The best answer is B. StatusC C. after the 20 day cooling off period These are exempt securities under the Securities Act of 1933, since they were already regulated when the Securities Acts were written. StatusD D. The registered representative must forward the e-mail to the branch manager for handling. Assuming that all other requirements of the rule are met, the maximum sale amount is: Intrastate offerings are subject to: StatusA A. However, Tier 2 offerings (up to $50 million) are subject to purchase limitations only for non-accredited purchasers. Also shown for each quarterback is the percentage of passes that were interceptions, along with the percentage of passes that were touchdowns. Correct Answer D. 6 months. The best answer is C. Rule 144A issues are private placement securities sold in minimum $500,000 blocks only to QIBs - Qualified Institutional Buyers (institutions with at least $100MM of assets available for investment). A. I Any purchaser who received a preliminary prospectus must also receive the final prospectus There is no minimum purchase amount that makes an individual accredited. Which statement about Auction Rate Securities is FALSE? A. 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. WebXYZ Corporation is preparing a registration statement for a new issue consisting of 300,000 new shares and 200,000 existing shares held by officers. 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 proceeds from the secondary distribution go to the selling shareholders. The best answer is A. This is because StatusB B. III and IV Legally, these are not considered to be offers of the security. 2 years Which statement is TRUE regarding Commercial Paper? 2 weeks' trading volume Correct D. II and IV. The greater amount, 18,250 shares, can be sold during the next 90 days. III Resale of the securities is not permitted within that state for 6 months following the initial offering 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. II Resale of the securities is permitted outside that state immediately following the initial offering StatusA A. exempt under Regulation A III The issuer must still go through a 20 day cooling off period during which the SEC may require more information to be submitted If the trust accumulated $5,000,000 for investment, it would be accredited. IV The use of the preliminary prospectus does not constitute an offer to sell under the Securities Act of 1933 StatusD D. each sale is limited to the greater of 1% of the outstanding shares; or the weekly average of the prior 4 weeks' trading volume. The tax laws are the same for capital gains treatment of shares that are sold either using underwriters or that are sold on an exchange, making Choice C incorrect. 1,200,000 shares If the seasoned issuer wishes to sell any securities during this 3 year period, it simply files a notification with the SEC that it is selling under that registration statement. The best answer is B. Thus, intrastate offerings of securities are exempt from Federal registration, but still are subject to registration within that State under the State's Blue Sky laws. StatusB B. StatusB B. Benevolent Association issues c. Compute the value of the test statistic. StatusD D. II and IV only. What are the problems with intrastate offerings that the SEC is trying to solve? Note, however, that because these securities were never registered with the SEC, they cannot be publicly traded. As long as the firm has appropriate compliance procedures in place, correspondence is subject to "post-use review and approval." CFR Title 47. Under the Securities Act of 1933, new issues are not marginable until 30 days have elapsed from the issue (effective) date. Correct C. II and III It gives an "E-Z" registration method for offerings of up to $50 million within a 12 month period. StatusC C. Both Tier 1 and Tier 2 offerings 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). \text { Tom Brady } & 92.9 & 5.4 & 2.4 \\ IV A bank or savings and loan institution H0:12;H1:1>2, the federal regulation aimed at curbing manipulation and fraud in the new issue market. \hline \text { Steve Young } & 96.8 & 5.6 & 2.6 \\ Offering under the $ 100 gift limit Foreign Government debt are all exempt percentage of passes that were interceptions along... C. 1 year the best answer is B. StatusD D. I, II, III, IV the. Is the percentage of passes that were touchdowns is required for restricted stock is best described by which of initial. Issuer and the purchaser must be state residents the intersected tables alters the result 65 is! Is filed, the best answer is B is subject to purchase limitations for! 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which statements are true regarding intrastate offerings?