Question

Is the following statement true or false and HOW? "Even if the initial offer of the sale of stock is limited to purchasers who reside within in one state (such as Kansas) the offer must still be registered with the SEC under the 1933 Securities Act. "?

Answer 1

Answer True

An offer made to purcahsers who reside in one state must still be registered with SEC under 1933 securities act and that offer is called to be Intrastate offering

Intrastate offering

An intrastate offering is an offering made only to the residents of a state by a corporation in that state. The offering must be registered in the state, and it must comply with SEC Rule 147:

• the issuer is incorporated in the state;
• at least 80% of the issuer's revenues must come from business within the state,
• at least 80% of the issuer's assets must be located in the state,
• at least 80% of the proceeds of the offering must be used in the state;
• buyers of the offering must be state residents or an entity owned by state residents.

Resale is permitted only:

• to other state residents;
• or to other buyers only after 9 months after the termination of the Rule 147 offering;
• and the certificates and offering document must specify these resale restrictions.