Exam 8: Securities Law Considerations When Obtaining Venture Financing

The definition of an "accredited investor," initially defined in the Securities Act of 1933, was expanded in Rule 501 of Regulation D.

Which of the following is a requirement of natural persons to be accredited investors under Rule 501 of Regulation D?

Rule 502 of Regulation D focuses, in part, on resale restrictions imposed on privately placed securities.

In general, while there are specific exceptions, public offerings of securities in the United States must be registered with the SEC.

Investor liability is unlimited under which of the following types of business organizational forms?

One of the monetary requirements for individuals or natural persons as accredited investors as defined in Rule 501 of Regulation D is a net worth greater than $1,000,000.

The primary exemption from the prohibition of resale of unregistered securities (including, but not limited to, securities safely harbored in Rule 506 offerings) is:

Rule 504 under Regulation D has a $2 million financing limit (i.e., applies to sales of securities not exceeding $2 million).

Which SEC regulation took effect in 1982 and provides the basis for safe harbor as a private placement?

The returning of all funds to equity investors as a common remedy for a fouled-up securities offering is called:

The two basic types of exemptions from having to register securities with the SEC are security and transaction exemptions.

Exemptions for private placement offerings and sales of securities limited to $5 million are covered under which of the following Regulation D rules?

Rule 503 of Regulation D states that a Form D should be filed with the SEC within six months after the first sale of securities.

Title II of the JOBS Act of 2012 eliminates the general solicitation and advertising restriction for Regulation D 506 offerings.

The Securities Act of 1933 provides a very narrow definition as to what constitutes a security.

Which of the following is not a condition of a Regulation D offering under Rule 502?

An offering that raises $10,000,000, involving 35 unaccredited investors and 100 accredited investors, might be exempt from registration under:

Ventures in the rapid-growth stage often need to seek new investors through large private or public offerings.

Rule 506 of Regulation D is limited in terms of the number of unaccredited investors to:

The JOBS Act of 2012 does not provide for which of the following?