Ch 2 Deck 19

Question 1

Reg D issuers file with

Answer 1

the SEC

Question 2

Reg D issuers file on form

Answer 2

D

Question 3

Reg D issuers file on form D within

Answer 3

15 days of the first sale

Question 4

Reg D issuers can sell before

Answer 4

they file anything (file Form D 15 days after)

Question 5

Rule 2730 prevents FINRA members in a fixed price offering from arranging the purchase of shares taken in trade from a customer

Answer 5

as payment for securities purchased by the customer

Question 6

The exception to Rule 2730 restriction on FINRA members purchasing taken in trade shares as payment for securities purchased by the customer is

Answer 6

if securities taken in trade are purchased at price no higher than fair market price

Question 7

Under FINRA rule 5121, member firm with conflict using QIU exemption must disclose

Answer 7

name and role of QIU

Question 8

Under FINRA rule 5121, member firm with conflict using can use QIU exemption if QIU prepares

Answer 8

registration and prospectus

Question 9

Under FINRA rule 5121, member firm with conflict using can use QIU exemption if QIU assists in

Answer 9

distribution

Question 10

In order to make a member private offering firm must provide

Answer 10

PPM or term sheet to each investor with disclosures

Question 11

In order to make a member private offering firm must file

Answer 11

PPM with FINRA prior to giving to investors

Question 12

One option for getting around FINRA rule 5121 prohibiting participation in public offering by firm with conflict is securing participation of

Answer 12

a QIU in offering

Question 13

One option for getting around FINRA rule 5121 prohibiting participation in public offering by firm with conflict is if the member firm primarily responsible

Answer 13

does not have a conflict or affiliation with conflicted firm

Question 14

One option for getting around FINRA rule 5121 prohibiting participation in public offering by firm with conflict is if the offered securities are either

Answer 14

exchange listed or

investment grade rated

Question 15

Minimum OTCBB listing requirements include submitting

Answer 15

reports to the SEC

Question 16

Minimum OTCBB listing requirements include minimum number of

Answer 16

stockholders

Question 17

Minimum OTCBB listing requirements include the minimum number of stockholders holding a minimum

Answer 17

number of shares

Question 18

Minimum OTCBB listing requirements include at least one

Answer 18

market maker

Question 19

Minimum OTCBB listing requirements include submitting form

Answer 19

211

Question 20

Minimum OTCBB listing requirements include submitting form 211 to

Answer 20

FINRA

Question 21

Rule 415(a) imposes 3 year time limitation on shelf offerings that are debt offerings backed by

Answer 21

mortgages

Question 22

Rule 415(a) imposes 3 year time limitation on shelf offerings that are continuous

Answer 22

offerings of more than 30 days

Question 23

Rule 415(a) imposes 3 year time limitation on shelf offerings that are by this type of issuer

Answer 23

S-3/F-3 Issuers

Question 24

Rule 14d-10 equal treatment of security holders: tender offer must be open to all

Answer 24

security holders of the class

Question 25

Rule 14d-10 equal treatment of security holders: in tender offers the consideration paid to any security holder is

Answer 25

the highest consideration paid to any other security holder

Question 26

Rule 144 control securities are securities

Answer 26

held by an affiliate of the issuer

Question 27

Rule 144 Affiliate definition is

Answer 27

one who is controlled by issuer or controls the issuer

Question 28

FWP must include legend saying that a

Answer 28

registration statement has been filed

Question 29

FWP must include a legend telling where

Answer 29

a copy of the preliminary prospectus may be obtained

Question 30

Option 1/2 for qualifying as a WKSI is a worldwide

Answer 30

public float of $700M

Question 31

Option 1/2 for qualifying as a WKSI is a worldwide public float of 700M in

Answer 31

common equity

Question 32

Public float is

Answer 32

equity not held by affiliates

Question 33

accredited investors include corporations, trusts and partnerships with

Answer 33

more than $5M in assets

Question 34

Accredited investors include large

Answer 34

institutional investors

Question 35

Accredited investors include people associated with issuer including

Answer 35

issuer’s directors, officers, general partners

Question 36

Accredited investors include any firm where all

Answer 36

owners are accredited investors (venture capital firms)

Question 37

member private offerings require disclosure in PPM or term sheet of intended

Answer 37

use of proceeds

Question 38

member private offerings require disclosure in PPM or term sheet of offering

Answer 38

expenses

Question 39

member private offerings require disclosure in PPM or term sheet of selling

Answer 39

compensation for syndicate members

Question 40

Individuals that are accredited investors include individuals with net worth more than

Answer 40

$1M

Question 41

Individuals that are accredited investors include individuals with net worth more than $1M but this does not include

Answer 41

value of home

Question 42

Individuals that are accredited investors include individuals with income of

Answer 42

200,000 within 2 years or 300,000 with spouse