Qualified Purchaser (QP)

Definition:

An entity or individual that is deemed to be sophisticated enough not to require certain protections applicable to a general Public Offering. Section 3(c)(7) of the Investment Company Act provides an exemption from registration if prospective investors are QPs within the meaning of the Investment Company Act. Under Rule 2(a)(51) and Rule 2(a)(51-1), the categories of persons or entities deemed to be QPs are: (i) individuals who own US$5 million in investments; (ii) Institutional Investors that own US$25 million in investments; (iii) family-owned companies that own US$5 million in investments; (iv) certain trusts in which the Trustee and each settlor are QPs; (v) certain QIBs; (vi) any company, if each beneficial owner of the company’s securities is a QP; (vii) knowledgeable employees of certain funds as defined under Section 3(c)(7) of the Investment Company Act; and (viii) certain persons who receive securities in a Section 3(c)(7) fund from a QP as a gift, bequest, or due to certain other involuntary events.

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