Private placement rules and limited representative private securities offering concepts tested on the Series 82 exam.
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- What is Regulation D?
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A SEC rule providing exemptions from registration for certain limited offerings of securities to a limited number of persons.- What is Rule 504?
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A Regulation D exemption allowing issuers to offer and sell up to $10 million of securities in any 12-month period without registering with the SEC.- Under Rule 504, what is the maximum offering amount?
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$10 million in any 12-month period.- What is Rule 505?
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A Regulation D exemption allowing offerings of up to $5 million in any 12-month period to unlimited accredited investors and up to 35 non-accredited investors.- Under Rule 505, what is the maximum offering amount?
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$5 million in any 12-month period.- What is Rule 506(b)?
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A Regulation D exemption allowing unlimited offering amounts to unlimited accredited investors and up to 35 non-accredited sophisticated investors, with no general solicitation.- What is Rule 506(c)?
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A Regulation D exemption allowing unlimited offering amounts to unlimited accredited investors only, with general solicitation permitted if investor accreditation is verified.- Define an accredited investor.
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A person meeting specific income or net worth standards set by the SEC, or an institution with significant assets, who may purchase unregistered securities.- What is the annual income threshold for an individual to be accredited?
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$200,000 in the past two years (or $300,000 jointly with a spouse) and reasonably expected to reach the same level in the current year.- What is the net worth threshold for an accredited individual?
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$1 million or more (excluding primary residence).- Under Rule 505, how many non-accredited investors may purchase securities?
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Up to 35 non-accredited investors.- Is general solicitation permitted under Rule 504?
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Yes, if the securities are sold only to accredited investors or if state approval requirements are met.- Is general solicitation permitted under Rule 505?
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No, general solicitation is not permitted under Rule 505.- Is general solicitation permitted under Rule 506(c)?
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Yes, general solicitation is permitted if the issuer takes reasonable steps to verify that all purchasers are accredited investors.- What is Form D?
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A notice of exempt offering filed with the SEC to report completed offerings under Regulation D.
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