When a corporation issues securities under a nonpublic offering or safe-harbor exemption from SEC regulations,it is free of the burden of supplying any disclosures to the investor due to the investor's experience and knowledge of the process.

Question

Quizplus · Accepted Answer

Even when issuing securities under a nonpublic offering or safe-harbor exemption, corporations must still provide some disclosures to investors, including information about the risks involved in investing in the securities. The amount and extent of these disclosures may be reduced compared to those required in a public offering, but they cannot be completely eliminated. Additionally, the investor's experience and knowledge of the process is not a sufficient reason for the corporation to avoid providing disclosures.

When a Corporation Issues Securities Under a Nonpublic Offering or Safe-Harbor