Securities and The Registration Process Flashcards
1
Q
What are the elements of an investment contract?
A
- Investment of money
- In a common enterprise
- With an expectation of profit
- To be earned primarily by the actions of others
2
Q
Are general partnership interests securities?
A
-No
3
Q
What is the basic process for an IPO registration?
A
- Issuer files registration statement with SEC
- Waits 20 days for SEC approval during which time preliminary red herring prospectus and tombstone advertisements disseminated
- Registration statement “effective” and sales can begin
4
Q
When can companies offer/sell securities under 1933 Act?
A
Prefiling period: Neither offer nor sell
Waiting period: Offer but not sell
After waiting period: Offer and sell
5
Q
What are the contents of the registration statement?
A
- Audited financial statements
- Names of issuer, directors, officers, underwriters, etc.
- Risks
- Description of business
- Description of security and intended use of proceeds
6
Q
Can the red herring be used after the waiting period?
A
-No, use the Final Prospectus after waiting period
7
Q
What must be delivered with securities under 1933 Act?
A
-Final Prospectus
