SIE Exam Question 413: Answer and Explanation

Question: 413

When the term 'shelf registration' is used, it typically refers to:

• A. Registering securities with the SEC in anticipation of a future offering.
• B. Registering securities with the SEC and selling part of the registered securities immediately and reserving the remaining securities for sale at a later time.
• C. Filing a notice with the SEC of the Issuer's intent to file a registration statement in the next 90 days.
• D. An offering which began but due to lackluster public interest, was put 'on the shelf' for a period not to exceed 30 days to see if investor interest picked up.

Correct Answer: B

Explanation:

B: This is the industry's definition of a 'shelf' offering – register more shares now than you intend to sell now, and save the balance for a later time, putting them 'on the shelf.'