To raise $120 million to expand operations, Primo Content Inc. makes a stock offering directly to sixty accredited investors and twenty sophisticated, but unaccredited investors. The firm plans to notify the SEC of sales. Under the Securities Act of 1933, this issue may qualify as an "exempt" transaction

Question

To raise $120 million to expand operations, Primo Content Inc. makes a stock offering directly to sixty accredited investors and twenty sophisticated, but unaccredited investors. The firm plans to notify the SEC of sales. Under the Securities Act of 1933, this issue may qualify as an "exempt" transaction​

Quizplus · Accepted Answer

The Securities Act of 1933 provides an exemption from registration requirements for private placements with a limited number of accredited investors and sophisticated unaccredited investors, but the issuer must provide them with material information about the firm, including its most recent financial statements. Therefore, option B is the best choice. Options A and C are not correct because the offering is limited to accredited and sophisticated unaccredited investors and is not being offered to the general public. Option D is incorrect because the offering may qualify for an exemption under the Securities Act of 1933.

To Raise $120 Million to Expand Operations, Primo Content Inc