When a Share Sale Is Restricted to Private Placement, an Entrepreneur

question 97

True/False

When a share sale is restricted to private placement, an entrepreneur can avoid many of the demanding requirements of the securities laws.

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Definitions:

Commercial Paper

Commercial Paper is an unsecured, short-term debt instrument issued by corporations, typically for the financing of operating expenses and meeting short-term liabilities.

Maturity

The date when a financial instrument (like a bond) expires and the principal is to be paid back to creditors.

Annual Interest Rate

The percentage increase in money lent or invested over a one-year period, expressed as a percentage of the principal.

Cash Conversion Cycle

A metric that measures the time between when a company pays for its inventory and when it receives cash from selling it.