Problem 1: Two Offerings, One Prospectus

Rule 5 of 14 in this unit1.4

1.4 Offerings

SIE outline 1.4

Problem 1: Two Offerings, One Prospectus

New company shares = IPO. Existing founder shares in the same deal = secondary, at once. NOT one single offering type.

The method for this kind of question

Sort first. Arithmetic second.

Now answer

1 question on this screen, from this outline item's own pool, so some will test a rule you met earlier in the unit. Pick an answer, say how sure you are, then reveal. Being sure and wrong is the most useful thing that can happen here, and the coach treats it that way.

Question 1Exam level

Under Regulation D Rule 506(b), how many non-accredited purchasers may an issuer sell to, without general solicitation?

A. Up to 35, in any 90-day period B. Up to 100, with no time limit C. None; 506(b) only permits accredited purchasers D. Up to 35, with no general-solicitation restriction

How sure are you?

Sure Fairly sure Guessing

Correct: A. 506(b) allows no general solicitation, but permits up to 35 non-accredited purchasers in any 90-day period.

B. 100 does not appear in Rule 506(b)'s own text; the limit is 35.

C. 506(b) does allow a limited number of non-accredited purchasers; it is not accredited-only.

D. Correctly states the 35-purchaser number but drops the no-general-solicitation condition that defines 506(b) against 506(c).

Unit: SIE outline 1.4

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