The Secrets of Wall St. Course – Conduct a Series of Securities Offerings

Question 1 of 23

1. Question

Assuming commercial success the most expensive form of capital is:

a. Common Voting Equity
b. Common Non-voting Equity
c. Preferred Non-voting Equity
d. Convertible Debt
e. None of the Above

Question 2 of 23

2. Question

Which security tends to work best for raising seed capital?

a. Common Stock
b. Convertible Participating Preferred Stock
c. Royalty Financing Contracts
d. Convertible Notes

Question 3 of 23

3. Question

Which security tends to work best for raising development capital?

a. Common Stock
b. Convertible Participating Preferred Stock
c. Royalty Financing Contracts
d. Convertible Notes

Question 4 of 23

4. Question

Seed capital is best used to:

a. Protect the company’s assets—i.e., intellectual property or “IP”
b. Sustaining (not expanding) basic business operations
c. Raise development capital through a series of related securities offerings with the issuance of hybrid securities in compliance with federal and state(s) securities laws.
d. All the Above
e. None of the Above
f. Only a & b

Question 5 of 23

5. Question

Development capital is best used for:

a. Hiring employees, especially additional management- team members
b. Capital expenditures (assets)
c. Generating sales and increasing the revenue stream
d. Produce and promote the next securities offering for “expansion capital” through “public solicitation”
e. All the Above
f. None of the Above
g. Only a, b & c

Question 6 of 23

6. Question

Expansion capital is best used for:

a. Expanding sales and customer service operations
b. Acquiring additional capital assets
c. Expanding the administrative employee base
d. Executing acquisitions of entire companies or their assets
e. Paying off creditors
f. All the Above
g. None of the Above
h. Only a, b, c & d

Question 7 of 23

7. Question

It is often wise for an Early Stage company to issue common stock on a publicly traded securities exchange because it’s easier to raise capital

True
False

Question 8 of 23

8. Question

Market makers like secondary offerings of penny stocks

True
False

Question 9 of 23

9. Question

By selling a series of hybrid securities to raise capital for your start-up or early stage company you further assure:

a. The capital structure does not become cost prohibitive—by implementing the rolling of re-financing techniques
b. Your Company maintains compliance with securities regulations and financial results are optimized
c. You do not sell too much of your Company too early for too little
d. That the capital is actually raised
e. The burden of regulatory compliance is shifted to the broker dealer
f. All the Above
g. None of the Above
h. Only a, b, c, & d

Question 10 of 23

10. Question

You and your wife own shares in your company jointly. You both can legally solicit and sell your Company’s securities.

True
False

Question 11 of 23

11. Question

Only SEC-registered FINRA Member broker-dealers or bona fide officer or director of your Company can legally solicit and sell your Company’s securities.

True
False

Question 12 of 23

12. Question

Any officer or director may be specially compensated directly or indirectly for communicating with prospective investors.

True
False

Question 13 of 23

13. Question

Federal law, however, provides an issuer-employee exemption for participation in how many offerings per year?

a. One
b. Less than 10 of the same classes of securities
c. No more than 10 of different classes of securities
d. None of the Above
e. Only b & c

Question 14 of 23

14. Question

The CFO or VP of Finance’s job description must be in the nature that raising capital is an incidental part of that position.

True
False

Question 15 of 23

15. Question

A true CFO or VP of Finance’s background should come from what industry(s)

a. Accounting
b. Commercial Banking
c. Corporate Finance
d. Investment Banking
e. None of the Above

Question 16 of 23

16. Question

In addition to raising capital through securities- offerings, an in-house finance department can manage:

a. Future capital-raising efforts in-house or in conjunction with your SEC-registered broker-dealer
b. Franchise operations
c. Commercial banking relationships
d. Supplier-creditor relationships
e. Lessees and lessors relationships
f. Product lease options
g. Investor relations
h. An exit strategy for the owners’ shares, when they are ready to divest their ownership positions
i. All the Above
j. None of the Above
k. Only a, b & d

Question 17 of 23

17. Question

During the hiring process, it is wise to have a final draft copy securities-offering document available to show to qualified CFO candidates, so they can make an informed decision on whether or not to join your firm.

True
False

Question 18 of 23

18. Question

Additional Benefits of Issuing Hybrid Securities would include:

a. The Founders’ common equity ownership and voting control is not diluted or lost.
b. Hybrid securities are in high demand.
c. Hybrid securities either mature or can be “called” or redeemed at a pre-set price, making this form of equity capital…temporary.
d. Hybrid securities can be used as currency for asset or company-acquisition purposes.
e. If hybrid securities are listed on a publicly traded securities exchange, offering them directly to market makers at a discount (from market price) makes raising additional rounds of capital very easy.
f. All the Above
g. None of the Above
h. Only a, b & d

Question 19 of 23

19. Question

80% of all start-up and early stage companies fail or stagnate within their first five years primarily due to lack of sufficient capital reserves.

True
False

Question 20 of 23

20. Question

Your early to later-stage Company may also need to invest in marketing support—approximately $50,000–$100,000 in additional cost—for a broker-dealer to be interested in an engagement with your early to later-stage

True
False

Question 21 of 23

21. Question

Hiring money finders can be extremely dangerous— and it rarely works. You should never pay any up-front investor introductory fees.

True
False

Question 22 of 23

22. Question

No one is going to raise capital for your start-up You are essentially on your own at the pre-revenue stage.

True
False

Question 23 of 23

23. Question

When competing for capital in any market environment, simply compete on the basis of the following criteria:

a. Relative safety of principal
b. Immediate return (yield)
c. Long-term return (profit participation/capital gains)
d. Liquidity
e. All the Above
f. None of the Above
g. Only a & c \

The Secrets of Wall St. Course – Conduct a Series of Securities Offerings