SIE practice questionhardRule 144 — Restricted Securities
Under SEC Rule 144, which of the following is a requirement for selling restricted securities?
- ARestricted securities can never be sold on the open market
- BThe securities must be held for at least 3 months before resale
- CThe seller must hold the securities for at least 6 months if the issuer is a reporting company✓ Correct answer
- DThere is no holding period requirement for restricted securities
Explanation
Why C — The seller must hold the securities for at least 6 months if the issuer is a reporting company
Rule 144 requires a 6-month holding period for restricted securities of reporting companies (those that file with the SEC) and a 12-month holding period for non-reporting companies. After the holding period, the shares may be sold subject to volume limitations, manner of sale requirements, filing of Form 144, and adequate current public information.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Capital Markets & Offerings questions
- Which of the following is considered an affiliate (control person) under Rule 144?
- A startup company wants to raise $35 million from the public without filing a full registration statement. Which…
- Under Rule 144, an affiliate selling restricted securities of a reporting company must limit sales during any 90-day…
- A small business raises capital by selling securities to a group of accredited investors without registering with the…