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Securities Law Private University, a private nonprofit educational institution located in Califor¬nia, decides to issue “Shares in Learning” certificates in a one-time offering to the public. These shares will be sold for $500 each and entitle the bearer to redeem each certificate for two undergraduate or one graduate college credit in any of its schools at any time in the future. The shares may also be resold without restric¬tion by the initial purchaser. The offering will be made via the Internet. Will the offering need to be registered with the Securities and Exchange Commission (SEC) under the Securities Act of 1933? Explain. Does your answer differ if “Shares in Learning” are issued by Private College, a proprietary for-profit institution that does business in all 50 states? Why? Guided Response: Respond to at least two of your fellow students’ posts in a substantive manner. Some ways to do this include the following, though you may choose a different approach, providing your response is substantive: Agree or disagree with your classmate’s posting. Posit facts that might change the outcome of the analysis. To begin, a share is basically a certificate representing on unit of ownership in a corporations, mutual fund, and/or limited partnership. Therefore, being that Private University is offering “Shares of Learning” certificates to the public, do not have to register with the Securities and Exchange Commission (SEC), under the Securities Act of 1933, because according to the Securities Act of 1933, “securities issued by nonprofit religious, charitable, educational, benevolent, or fraternal organizations (Seaquist, 2012)”, are exempt from registration. But keep in mind that, there is a common misconception that religious and other nonprofit organizations are exempt from compliance with the securities laws. They are not. Nonprofit organizations that engage in fundraising activities involving the offer and sale of securities must still comply with the federal securities laws. They also must comply with the securities laws of each state in which such activities are conducted. On that note, my answer differs if “Shares in Learning” are issued by Private College, a proprietary for-profit institution that does business in all 50 states, then they absolutely must register before they try to sell or even advertise the certificates. Why should they register? Because the “federal law requires that securities be registered before being offered for sale for the first time. Registration means that the corporation that plans to sell the stock must file paperwork with the Securities and Exchange Commission (SEC), a federal agency that oversees public sales of securities (Seaquist, 2012).” The overall general purpose of this registration is to protect the public from fraudulent organizations, who may try to make a profit off the investor, perform deceptive activities, and it prevents public issuance or the investor with a false description of who they are as company and their purpose, by forcing the company to provide a detailed description of who they are as an organization. For example, “before any new security can be offered to the public through the mails or through any interstate commerce facility (such as a stock exchange or the Internet), the issuer (Private University) must file a registration statement with the SEC (Seaquist, 2012), meaning that all the following must be in Private University’s registration statement must provide: “a description of the significant provisions of the security offered for sale that includes the relationship between the security and other capital securities of the company; a description of the company's properties and business; a description of the company's management that includes information on the management's security holdings, compensation, and benefits; a financial statement certified by an independent public accounting firm; and a description of pending lawsuits involving the company (Seaquist, 2012).” Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc.