Rule 701 and Compensatory Benefit Plans

This lesson is an introduction to Securities Act Rule 701, which exempts offers and sales of securities pursuant to compensatory benefit plans. It discusses the conditions which an issuer is required to meet to avoid registering such an offering.

Before taking this lesson, students should have a basic understanding of the Securities Act of 1933 and its registration requirement. The lesson provides links to the relevant regulatory provisions, but you might find it helpful to have your own copy of Rule 701.

Learning Outcomes

On completion of the lesson, the student will be able to:

1. Apply the main requirements of Rule 701 to determine if offers and sales fit within the exemption.
2. List the requirements that Rule 701 imposes in order for a compensatory benefit securities plan to avoid registration.