Which of the following activities are allowed once a registration statement for a new issue is filed with the SEC quizlet?

Q: Which of the following is allowed by SEC Rule 144A quizlet?

Rule 144A allows qualified institutional buyers (QIBs) to buy and trade between themselves large blocks of privately placed issues. Thus, issuers can sell private placements to these QIBs, who can then trade the private placement issues among themselves.

The best answer is C.

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Which of the following activities are allowed prior to the filing of a registration statement?
Which of the following is allowed by SEC Rule 144A quizlet?
What is a registration statement quizlet?
What securities offering must be registered with the SEC quizlet?

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. 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. 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. If the trust accumulated $5,000,000 for investment, it would be accredited. But the rule disallows this if the trust is formed for the purpose of buying the private placement!

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The best answer is B. Rule 144 includes a "de minimis" exemption, permitting the sale every 3 months of 5,000 shares or less, worth $50,000 or less, without having to file a Form 144. The transfer agent is authorized by the SEC to transfer the shares without a copy of the Form 144. Because this sale is 5,000 shares @ $8 = $40,000, it can be done under this exemption. Rule 144 applies to the public resale of restricted (unregistered private placement) stock and to the sale of registered control shares. Control shares are registered shares owned by a key officer or director. 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.

The best answer is B.
Rule 144A states that issuers can sell "private placements" in large block sizes (typically $500,000 or more per unit) to QIBs - Qualified Institutional Buyers - without having to register them with the SEC. A QIB is an institution with at least $100 million available for investment. Rule 144A solves a problem with private placements for QIBs - the fact that they are illiquid. Rule 144A issues can be traded from QIB to QIB in the "PORTAL" market. This opens up the market for these securities to large institutional investors, who would not buy unless they knew they could sell the holding at will.
Accredited Investors are defined under Regulation D - Private Placement offerings. A private placement can be sold to an unlimited number of accredited investors without SEC registration. The basic definition of an accredited investor is:
Individual with $200,000 of annual income;
Married Couple with $300,000 of annual income;
Individual or Couple with a $1,000,000 net worth (excluding home);
Institution with at least $5,000,000 available for investment; and
Officers and directors of the issuer.
Private placements can also be offered to up to 35 non-accredited investors, but these individuals must be sophisticated investors, able to judge the merits of the offering. If the individual is not sophisticated, then he or she can use a purchaser representative (typically the customer's lawyer) to review the offering.
Major Institutional Investors (MIIs) are defined under SEC Rule 15a-6. It allows foreign broker dealers to solicit MIIs in the United States without having to register with the SEC and FINRA; and it allows then to accept unsolicited orders from anyone. Note that if a foreign broker-dealer were to solicit the general public in the U.S., then it would have to register.

The best answer is D.
Regulation D is the private placement exemption from registration. It basically states that private placements that are not offered to the general public are exempt from registration. Rule 506 (the major rule under Regulation D) states that if an offering is made to a maximum of 35 non-accredited investors and to an unlimited number of accredited (wealthy) investors, then it is exempt from SEC registration.
Regulation S states that if a U.S. company sets up a non-U.S. subsidiary, and offers securities only to non-U.S. residents, then it is exempted from having to register those securities with the SEC (because the offering is not being made in the U.S.).
Rule 144A states that issuers can sell "private placements" in large block sizes (typically $500,000 or more per unit) to QIBs - Qualified Institutional Buyers - without having to register them with the SEC. A QIB is an institution with at least $100 million available for investment. Rule 144A solves a problem with private placements for QIBs - the fact that they are illiquid. Rule 144A issues can be traded from QIB to QIB in the "PORTAL" market. This opens up the market for these securities to large institutional investors, who would not buy unless they knew they could sell the holding at will.
Regulation A is an "EZ" registration rule that applies to issues up to $50 million. It makes it simpler for smaller companies to raise capital. Instead of filing a full registration statement with the SEC, the company files an "abbreviated" simplified registration. Instead of going through a 20 day "quiet period," the company goes through a 20 day "review period," where the issue can be marketed to "test the waters" (this is not allowed for regular registered issues). Once registration is effective, the issue is sold with an Offering Circular rather than a Prospectus. Regulation A issues, because they are registered and the company must report to the SEC, can be listed on exchanges and traded there.

Sets with similar terms

Which of the following activities are allowed prior to the filing of a registration statement?

Which of the following activities are allowed prior to the filing of the registration statement? Prior to the filing of the registration statement, nothing can be done. Once the registration statement is filed, a preliminary prospectus may be used to obtain indications of interest.

Which of the following is allowed by SEC Rule 144A quizlet?

Rule 144A allows qualified institutional buyers ("QIBs") to buy and trade between themselves large blocks of privately placed issues. Thus, issuers can sell private placements to these QIBs, who can then trade the private placement issues among themselves.

What is a registration statement quizlet?

registration statement. a document that an issuer of securities files with the SEC that contains required information about the issuer, the securities to be issued, and other relevant information.