BUS 670 Week 4 Discussion 1.docx – Private University
Private University is a nonprofit educational institution and would be exempt from registration.
The Securities Act of 1933 provides an exemption from registration for securities issued by
nonprofit religious, charitable, education, benevolent, or fraternal organizations (Seaquist, 2012).
Since they are a nonprofit education institute, they have met this qualifier.
If Private University were a for-profit educational institution, then it does not qualify within the
list under the Securities Act of 1933. There are additional qualifiers for exemption that may
apply. Rule 147 indicates that they would be exempt if the securities were only offered within
California, where it is located and established, and does 80% of its business within the state
(Seaquist, 2012). Private University indicated that they would not restrict the securities to be
resold by the initial purchaser. In order to stay exempt under Rule 147, Private University must
restrict the resale to only California residents for the initial nine months (Seaquist, 2012). The
Internet offering would need to be restricted to California residents.
The Securities Act of 1933 provides an exemption from registration for securities issued by
nonprofit religious, charitable, education, benevolent, or fraternal organizations (Seaquist, 2012).
Since they are a nonprofit education institute, they have met this qualifier.
If Private University were a for-profit educational institution, then it does not qualify within the
list under the Securities Act of 1933. There are additional qualifiers for exemption that may
apply. Rule 147 indicates that they would be exempt if the securities were only offered within
California, where it is located and established, and does 80% of its business within the state
(Seaquist, 2012). Private University indicated that they would not restrict the securities to be
resold by the initial purchaser. In order to stay exempt under Rule 147, Private University must
restrict the resale to only California residents for the initial nine months (Seaquist, 2012). The
Internet offering would need to be restricted to California residents.