Securities Regulation

Tork may not resell the securities if the certificates contain a legend indicating that they are unregistered securities.

Tork may resell the securities as part of another transaction exempt from registration.

Tork may resell the securities so long as the sale does involve interstate commerce.

Tork may not resell the securities unless Tork obtains a written SEC exemption.

Yes, because the misrepresentations were material.

No, because the securities are exempt from registration.

Yes, because the securities are required to be registered.

No, because only the issuer was negligent.

North American Free Trade Act.

Federal Trade Commission Act.

Securities Act of 1933.

Securities Exchange Act of 1934.

The investor is assured by the SEC against loss resulting from purchasing the security.

The investor is guaranteed by the SEC that the facts contained in the registration statement are accurate.

The investor is provided with information on the principal purposes for which the offering's proceeds will be used.

The investor is provided with information on the stockholders of the offering corporation.

Securities issued by savings and loan associations.

Securities issued by insurance companies.

Securities guaranteed by domestic governmental organizations.

Securities issued by not-for-profit, charitable organizations.

The offering is exempt from the anti-fraud provisions of the 1933 Act.

Resales of the offering must be made under a registration or a different exemption provision of the 1933 Act.d

Resales of the offering are exempt from the provisions of the 1933 Act.

The offering is subject to the registration requirements of the 1933 Act.

The securities are nonvoting preferred stock.

The sale or offer to sell the securities is made by a person other than an issuer, underwriter, or dealer.

The securities are AAA-rated debentures that are collateralized by first mortgages on property that has a market value of 200% of the offering price.

The issuing corporation was closely held prior to the offering.

.The shares of the offering could not be resold to investors outside the state for at least one year.

The offering would be exempt from the registration requirements of the Securities Act of 1933.

The offering would be regulated by the SEC.

The offering would be subject to the registration requirements of the Securities Exchange Act of 1934.

The prospectus must be filed after an offer to sell.

The prospectus is a part of the registration statement.

The prospectus is prohibited from being distributed to the public until the SEC approves the accuracy of the facts embodied therein.

The prospectus should enable the SEC to pass on the merits of the securities.

Qualified prospectus.

Unaudited prospectus.

"Red-herring" prospectus.

"Blue-sky" prospectus.

All offerings made under Regulation

Any stockbroker transaction.

All intrastate offerings.

Any resale of a security purchased under Regulation D offering.

Investment contracts.

Certificates of deposit.

Convertible debentures.

Nonconvertible debentures.

.Plaintiff gave value for the security.

Issuer failed to exercise due care in connection with the sale of the securities.

Issuer and plaintiff were in privity of contract with each other.

Plaintiff suffered a loss.

Sell only to accredited investors.

Provide investors with the prior four years' audited financial statements.

File an offering circular with the SEC.

Provide investors with a proxy registration statement.

Because Adler is a reporting company, it is not required to file a registration statement under the Securities Act of 1933 for any future offerings of its common stock.

Any person who owns more than 10% of Adler's common stock must file a report with the SEC.

Adler need not file its proxy statements with the SEC because it has only one class of stock outstanding.

It is unnecessary for the required annual report (Form 10K) to include audited financial statements.

A stockholder who owns more than 10% of the outstanding common stock.

An attorney for the corporation.

An owner of 5% of the corporation's outstanding debentures.

A member of the board of directors.

Regulation D, Rule 505.

Regulation A.

Regulation D, Rule 504.

Regulation D, Rule 506.

No more than 35 unaccredited investors.

No more than 35 investors

Accredited investors only.

Unaccredited investors only.

.May sell the stock to an unlimited number of investors.

May make the offering through a general advertising.

Must notify the SEC within 15 days after the first sale of the offering.

Must provide all investors with a prospectus.

The names of all prospective accredited investors.

A copy of the corporation's latest proxy solicitation statement.

.The principal purposes for which the offering proceeds will be used.

A list of all existing stockholders.

General partnership interests.

Limited partnership interests.

Warrants.

Stock options.

.Proxy solicitation provisions.

Provisions imposing periodic audits.

Provisions dealing with the filing of annual reports.

Antifraud provisions.

Is prohibited from making private placement offerings.

Must distribute copies of Form 10-K to its stockholders.

Must submit Form 10-K to the SEC except in those years in which the corporation has made a public offering.

Is subject to having the registration of its securities suspended or revoked.

Is exclusively available to small business corporations as defined by Regulation D.

Permits an exempt offering to be sold to both accredited and unaccredited investors.

Is limited to offers and sales of common stock that do not exceed $1.5 million.

Restricts the number of purchasers of an offering to 35.

Intentionally preparing and filing with the SEC a reporting corporation's incorrect quarterly report.

Negligently filing a reporting corporation's tax return with the IRS.

Intentionally failing to notify a reporting corporation's audit committee of defects in the verification of accounts receivable.

Negligently approving a reporting corporation's incorrect internal financial forecasts.

One-year notes issued to raise working capital.

Municipal bonds.

Pre-incorporation stock subscriptions.

Securities sold by a discount broker.

The absence of privity between purchasers and the accountant.

The absence of scienter on the part of the accountant.

Nonreliance by purchasers on the misstatements.

Due diligence on the part of the accountant.

Companies with annual revenues in excess of $5 million and 300 or more shareholders.

Companies with annual revenues in excess of $10 million and 500 or more shareholders

Companies with assets in excess of $10 million and 500 or more shareholders

Companies with assets in excess of $5 million and 300 or more shareholders.

.Twenty-four months.

Twelve months.

Three months.

Six months.

If the CPA can prove due diligence.

If the financial statements were materially misstated.

Unless the purchaser can prove scienter on the part of the CPA.

Unless the purchaser can prove privity with the CPA.

Intentional misconduct.

Strict liability.

Negligence.

Criminal intent.

Negligently.

Without good faith.

With independence.

Without due diligence.

Issuance of stock by a publicly-traded corporation to its shareholders because of a stock split.

The public sale by a charitable organization of 10-year bearer bonds.

The public sale by a corporation of its negotiable 10-year notes.

The sale across state lines of municipal bonds issued by a city

Good faith and lack of knowledge of the statement's falsity.

Exercise of due care.

Lack of gross negligence.

Lack of privity with an injured party.

An issuer is permitted to advertise an initial offering of securities only through distribution of the prospectus.

.All securities issuers must register the securities offering with the Securities and Exchange Commission (SEC).

All securities issuers must provide potential investors with a prospectus containing specified information.

If an issuer sells a security and fails to meet certain disclosure requirements, the purchaser may sell it back to the issuer and recover the price paid.

The public sale of stock of a trucking company regulated by the Interstate Commerce Commission.

The issuance of stock by a publicly-traded corporation to its existing shareholders because of a stock split.

A public sale of municipal bonds issued by a city government.

The public sale by a corporation of its negotiable 10-year notes.

None of the answer choices are correct.

Exercised due diligence in preparing the financial statements.

Lacked criminal intent in preparing the financial statements.

Was not in privity of contract with the Investor.

At least 35 investors are accredited.

All of the investors are accredited.

All of the investors are sophisticated.

Any of the investors are accredited.

The issuer may sell the stock to only 35 accredited investors.

The issuer may make the offering through a general advertising.

The issuer must supply all accredited investors with financial information.

The issuer must notify the SEC within 15 days after the first sale of the offering.

Drane will lose because the stock purchased was not part of a new issue.

Drane will lose because only Edge is liable.

Drane will win because Pick was negligent.

Drane will win because Pick acted with intent.