'33 ACT Flashcards
What is the definition of exempt securities?
Except securities do not have to be registered with the SEC before they can be sold to the public. Another words they are exempt from the registration requirements under the securities act of 1933.
The definition of “security” under the ‘33 ACT includes which of the following securities?
Stocks,
bonds,
investment contracts,
rights,
warrants,
fractional interest in oil gas and other mineral rights,
puts/calls for both securities and foreign currencies
Provide examples of exempt securities under the SECURITIES ACT of 1933
1) US government securities such as bills, notes, bonds;
2) municipal securities;
3) private placements (regulation D)
4) intrastate offerings
5) regulation A offering (> $5 million total offered to the public);
6) commercial paper (maturity of 9 months or less);
7) promissory note – obligation to pay cash within nine months/denominations of at least $50,000;
8) securities issued by small business investment companies (SBIC);
9) savings and loans;
10) motor carriers (regulated by the ICC)
What does the term “accredited investor” refer to?
Certain wealthy investors who are eligible to participate in REG D private placements are considered accredited investors.
What are some examples of an accredited investor?
1) banks;
2) insurance companies;
3) registered investment companies
* A registered investment advisor (RIA) is NOT an accredited investor under the act of 1933*
Under the ACT of 1933, the term “OFFER to sell” includes what following activities?
1) a registered representative who solicit sales of securities from his customers,
2) a broker who attempts to sell part of a new issue to a customer
What are considered exempt transactions under the ACT of 1933?
A privately held corporation issuing stock to a new stockholder; an investment manager for an insurance company negotiating with a financial executive of a publicly held corporation to buy a note that matures in four years; broker transactions that are unsolicited
