REG 12 - Federal Securities Regulations Flashcards
Give mneumonic and list of what exemptions are listed under the Securities Act of 1933?
ACIDBRAINS - regulation A, Commercial paper(or Casual sales), Interstate Offerings, regulation D(private placements), Brokerage sales, Regulated industries, government Agencies, Insurance sales of policies, Not-for-profits, and Stock splits and dividends
Under Reg D 1933 Securities Act, what is the time limit for registration?
Registration becomes legal 20 days after initial filing
What is the maximum number of investors allowed for Regulation D?
Accredited-unlimited
Unaccredited-504 unlimited, 505 & 506, 35 or less.
What solicitation are allowed on Regulation d?
504 - general solicitation allowed.
506 - solicitation to accredited investors only
Treatment of proxies under 1933 act?
None. Proxy statements are required for filing along with 10K, 10Q and 8K in 1934 act
What percentage is required for a “tender offer”
5%.
What does being listed on a national stock exchange have to do with the 1934 Act?
Makes registration mandatory
Are tender offers reportable to SEC?
yes
What is a tombstone offer?
Informs potential investors of the availability of a prospectus
Does SEC prosecute securities fraud?
No. They pass prosecution on to the Justice Department
Would bank securities be exempt under 1933 Act? If so, why?
- Yes
2. Because they are regulated by the Federal Reserve System, and are considered a government agency in a sense.
What would a bank CD be classified as?
Commercial paper
Are securities sold by insurance companies exempted under 1933 act?
No, but insurance policies they sell are
Under Regulation D, can securities be resold sold under an exemption?
Only if the initial purchase was exempt.
Under 1934 act registration which size requirements make registration and reporting mandatory?
Original 1934 Ace- $10 million in assets, 500 shareholders
Under 2012 JOBS Act- 500 non-accredited shareholders or 2,000 total shareholders, exempting those receiving shares through employee stock option plan.
Under 1934 Act, what will allow a company to terminate registration of a class of securities?
Employee numbers dropping below the 500 mark
How soon before filing a registration statement can a company make offers to sell its stock?
NONE!!! Only after registration is accepted.
Under 1933 Act prospectus’ need to be sent accredited or unaccredited buyers?
ALL BUYERS!
Under 2012 JOBS Act when does a company lose its status as an Emerging Growth Company?
When it is recognized as a large accelerated filer
What does Dodd-Frank Act do with regulation of swaps?
Changes them from over-the-counter to clearinghouse products.
Under Dodd-Frank Act how much risk do lenders that sell loans bear?
5% of those that don’t meet safe harbor standards
Summarize Regulation A
similar to 505 section of Regulation D; ,$5 mil/12 mo/15days/offering circular. Allowed to resell and advertise.
What is Commercial Paper??
Notes & Bonds eual to or less than 9 mo. maturity, and used for commercial purposes as opposed to (investment)
Define Causal sales in 1933 Act.
Sales by people other than issuer, underwriter, dealer, director, or someone with more than 10% ownership in company.
