Ch. 4 Exempt Securities and Exempt Transactions

Question 1

Can a block of loans be defined as a security?

Answer 1

Yes

Question 2

What criteria must be met for a special exemption of a block of loans security?

Answer 2

Maturity does not exceed 270 days (9 months)

Question 3

Are ADRs, REITS, UITs, and Mutual Funds exempt from SEC registration?

Answer 3

No

Question 4

Regulation A (A+) offerings are limited to no more than $____ million over a ____-month period

Answer 4

Limited to no more than $50 million over a 12-month period

Question 5

Is a Reg. D offering (private placement) exempt from registration?

Answer 5

Yes

Question 6

Is a Rule 144A exempt from registration?

Answer 6

Yes

Question 7

Is a Reg S offering exempt from registration?

Answer 7

Yes

Question 8

Are financial institutions accredited investors per Reg. D?

Answer 8

Yes

Question 9

Under Reg. D 506(c), an issuer can raise an unlimited amount of capital and may use both general solicitation and genera advertising so long as ______

Answer 9

All of the purchasers are accredited investors

Question 10

If a foreign corporation wants to raise unlimited capital in the US without triggering SEC registration and wants to target wealthy investors, it may offer securities under _____

Answer 10

Reg. D

Question 11

What rule is mostly used by QIBs for trading privately placed corporate debt?

Answer 11

Rule 144A

Question 12

What is a type of private placement in which a broker-dealer acts as a placement agent for the restricted securities of an issuer that already has publicly traded securities?

Answer 12

Private Investment in Public Equity (PIPE)

Question 13

Do Qualified Institutional Buyers include individual investors?

Answer 13

No

Question 14

What must be the net worth of banks and S&Ls to be considered QIBs?

Answer 14

$25 million

Question 15

T/F: If a non-US person makes a permitted Reg. S offering purchase in Hong Kong, she may sell it immediately in the overseas market.

Answer 15

True