The Share offering from a non-profit Private University would not have to be registered because the Securities Act of 1933 states that non-profit organizations are exempt from registration laws (Seaquist, 2012)
The share offering coming from the same for-profit Private University will have to be registered in order to be SEC compliant. While not all shares need to be registered, the SEC exempt items are limited to private offerings to limited persons, offerings of smaller size, intrastate offerings or municipal, state and/or federal governments (Hamilton, Securities and Going Public Lawyer, 2021). Specific to the example, the Private University shares do not fall into any of these categories. The offer is going to be public and offered for sale online. There is no limit stated for the size of the offering and the shares being sold online means they can be sold across state lines.
References:
Seaquist, G. (2012). Business law for managers. Zovio.
Brenda Hamilton, Securities and Going Public Lawyer. (2021, July 9). What is a SEC Registration Statement? Going Public Lawyer. Hamilton & Associates Law Group, P.A. https://www.securitieslawyer101.com/2019/sec-registration-statements-going-public-lawyer/ (Links to an external site.)
Part 2
Based solely on the requirements set by the Federal government under the Securities Act of 1933, Private University would not have to file with the Securities and Exchange Commission (SEC). Although extremely limited, the Securities Act of 1933 provides a few exemptions, one of which being “securities issued by nonprofit religious, charitable, educational, benevolent, or fraternal organizations” (Seaquist, 30.1). With the slight change in registration of the business entity from non-profit to for-profit, the Private University would have to register their “shares for learning” certificates with the SEC. In my understanding of the requirements and regulations, if the Private University was to limit the amount and time frame of the securities sold, it would again become exempt. Under Regulation A “any nonpublic issuer may sell up to $5 million of securities in a one-year period with no limit on the number of purchasers and no purchaser sophistication requirement” (Seaquist, 30.1). It is important to note, that even though it relieves the organization of having to register with the SEC, it still would have to file other documentation.
