Review Quiz
- 1. For how many days after the issuance date must broker-dealers provide prospectuses to investors that buy a new issue in the secondary market that will be listed on a stock exchange?
- A. 10
- B. 15
- C. 25
- D. 45
- 2. If a company provides important documents such as shareholder reports, prospectuses, or proxy solicitations as a pdf download, which of the following would a company not have to do?
- A. make sure the documents are readily available through one click from the webpage
- B. obtain consent to electronic delivery
- C. provide any necessary software or technical assistance in downloading the pdf at no cost
- D. make sure the documents are available for at least 60 days
- 3. Issuer and shareholder lock-up agreements require that insiders:
- A. refrain from disclosing information about a potential merger
- B. refrain from buying shares for a certain period of time
- C. refrain from participating in the Employee Stock Option Plan
- D. refrain from selling their shares for a certain period of time
- 4. A Nasdaq market maker who participated in a security’s offering makes a bid for 200 shares from this offering on the open market within the restricted period. The highest current bid for the shares is $30/share. The market maker makes a bid of $29/share. The market maker notifies Nasdaq in advance of the bid. The market maker’s actions:
- A. are called “passive market making” and are allowed under Regulation M
- B. are called “passive market making” and are prohibited under Regulation M
- C. are called “active market making” and are allowed under Regulation M
- D. D: are called “active market making” and are prohibited under Regulation M
- 5. An underwriter wishes to enter a stabilizing bid on the NYSE for a new issue, whose price has been dropping from its inception. The stabilizing bid must be: