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Question 1 of 10
1. Question
Regarding Offerings Required to be Filed, which of the following statement(s) is/are true about documents and information relating to all other public offerings including?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Filing Requirements: Offerings Required to be Filed
Documents and information relating to all other public offerings including, but not limited to, the following must be filed with FINRA for review:
Exchange offers that are exempt from registration with the SEC under Sections 3(a)(4), 3(a)(9), or 3(a)(11) of the Securities Act (if a member’s participation involves active solicitation activities) or registered with the SEC (if a member is acting as dealer-manager) (collectively “exchange offers”),Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Filing Requirements: Offerings Required to be Filed
Documents and information relating to all other public offerings including, but not limited to, the following must be filed with FINRA for review:
Exchange offers that are exempt from registration with the SEC under Sections 3(a)(4), 3(a)(9), or 3(a)(11) of the Securities Act (if a member’s participation involves active solicitation activities) or registered with the SEC (if a member is acting as dealer-manager) (collectively “exchange offers”), -
Question 2 of 10
2. Question
Regarding documents and information relating to all other public offerings including, but not limited to, which of the following must be filed with FINRA for review?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Filing Requirements: Offerings Required to be Filed
Documents and information relating to all other public offerings including, but not limited to, the following must be filed with FINRA for review:
Exchange offers that are exempt from registration with the SEC under Sections 3(a)(4), 3(a)(9), or 3(a)(11) of the Securities Act (if a member’s participation involves active solicitation activities) or registered with the SEC (if a member is acting as dealer-manager) (collectively “exchange offers”), except for exchange offers exempt from filing pursuant to subparagraph (7)(F) above that are not subject to filing by subparagraph (9)(I) below;
(I) any exchange offer, merger and acquisition transaction, or other similar corporate reorganization involving an issuance of securities that results in the direct or indirect public ownership of the member; and
(J) any offerings of a similar nature that are not exempt under subparagraph (7) or (8) above.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Filing Requirements: Offerings Required to be Filed
Documents and information relating to all other public offerings including, but not limited to, the following must be filed with FINRA for review:
Exchange offers that are exempt from registration with the SEC under Sections 3(a)(4), 3(a)(9), or 3(a)(11) of the Securities Act (if a member’s participation involves active solicitation activities) or registered with the SEC (if a member is acting as dealer-manager) (collectively “exchange offers”), except for exchange offers exempt from filing pursuant to subparagraph (7)(F) above that are not subject to filing by subparagraph (9)(I) below;
(I) any exchange offer, merger and acquisition transaction, or other similar corporate reorganization involving an issuance of securities that results in the direct or indirect public ownership of the member; and
(J) any offerings of a similar nature that are not exempt under subparagraph (7) or (8) above. -
Question 3 of 10
3. Question
According to Underwriting Compensation and Arrangements, who can participate in any manner in any public offering of securities in which the underwriting or other terms or arrangements are unfair or unreasonable?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: General
No member or person associated with a member shall participate in any manner in any public offering of securities in which the underwriting or other terms or arrangements in connection with or relating to the distribution of the securities, or the terms and conditions related thereto, are unfair or unreasonable.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: General
No member or person associated with a member shall participate in any manner in any public offering of securities in which the underwriting or other terms or arrangements in connection with or relating to the distribution of the securities, or the terms and conditions related thereto, are unfair or unreasonable. -
Question 4 of 10
4. Question
According to Underwriting Compensation and Arrangements, why none can underwrite in a public offering of securities?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
No member or person associated with a member shall receive an amount of underwriting compensation in connection with a public offering that is unfair or unreasonable and no member or person associated with a member shall underwrite or participate in a public offering of securities if the underwriting compensation in connection with the public offering is unfair or unreasonable.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
No member or person associated with a member shall receive an amount of underwriting compensation in connection with a public offering that is unfair or unreasonable and no member or person associated with a member shall underwrite or participate in a public offering of securities if the underwriting compensation in connection with the public offering is unfair or unreasonable. -
Question 5 of 10
5. Question
Regarding Amount of Underwriting Compensation, why shall all items of value received or to be received from any source by the underwriter and related persons which are deemed to be in connection with or related to the distribution of the public offering as determined be included?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the amount of underwriting compensation, all items of value received or to be received from any source by the underwriter and related persons which are deemed to be in connection with or related to the distribution of the public offering as determined pursuant to subparagraph (3) below shall be included.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the amount of underwriting compensation, all items of value received or to be received from any source by the underwriter and related persons which are deemed to be in connection with or related to the distribution of the public offering as determined pursuant to subparagraph (3) below shall be included. -
Question 6 of 10
6. Question
Regarding Amount of Underwriting Compensation, where shall all items of underwriting compensation be disclosed?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
All items of underwriting compensation shall be disclosed in the section on underwriting or distribution arrangements in the prospectus or similar document and, if the underwriting compensation includes items of compensation in addition to the commission or discount disclosed on the cover page of the prospectus or similar document, a footnote to the offering proceeds table on the cover page of the prospectus or similar document shall include a cross-reference to the section on underwriting or distribution arrangements.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
All items of underwriting compensation shall be disclosed in the section on underwriting or distribution arrangements in the prospectus or similar document and, if the underwriting compensation includes items of compensation in addition to the commission or discount disclosed on the cover page of the prospectus or similar document, a footnote to the offering proceeds table on the cover page of the prospectus or similar document shall include a cross-reference to the section on underwriting or distribution arrangements. -
Question 7 of 10
7. Question
Which of the following statement is true if the underwriting compensation includes items of compensation in addition to the commission or discount disclosed on the cover page of the prospectus or similar document?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
If the underwriting compensation includes items of compensation in addition to the commission or discount disclosed on the cover page of the prospectus or similar document, a footnote to the offering proceeds table on the cover page of the prospectus or similar document shall include a cross-reference to the section on underwriting or distribution arrangements.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
If the underwriting compensation includes items of compensation in addition to the commission or discount disclosed on the cover page of the prospectus or similar document, a footnote to the offering proceeds table on the cover page of the prospectus or similar document shall include a cross-reference to the section on underwriting or distribution arrangements. -
Question 8 of 10
8. Question
Regarding Amount of Underwriting Compensation, for purposes of determining the currently effective guideline on the maximum amount of underwriting compensation how is it considered?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the currently effective guideline on the maximum amount of underwriting compensation is considered fair and reasonable.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the currently effective guideline on the maximum amount of underwriting compensation is considered fair and reasonable. -
Question 9 of 10
9. Question
For purposes of determining the currently effective guideline on the maximum amount of underwriting compensation, which of the following factors, as well as any other relevant factors and circumstances, is out of consideration?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the currently effective guideline on the maximum amount of underwriting compensation considered fair and reasonable, the following factors, as well as any other relevant factors and circumstances, shall be taken into consideration:
(i) the offering proceeds;
(ii) the amount of risk assumed by the underwriter and related persons, which is determined by:
a. whether the offering is being underwritten on a “firm commitment” or “best efforts” basis and
b. whether the offering is an initial or secondary offering; and
(iii) the type of securities being offered.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
For purposes of determining the currently effective guideline on the maximum amount of underwriting compensation considered fair and reasonable, the following factors, as well as any other relevant factors and circumstances, shall be taken into consideration:
(i) the offering proceeds;
(ii) the amount of risk assumed by the underwriter and related persons, which is determined by:
a. whether the offering is being underwritten on a “firm commitment” or “best efforts” basis and
b. whether the offering is an initial or secondary offering; and
(iii) the type of securities being offered. -
Question 10 of 10
10. Question
Which of the following statement(s) is true when the maximum amount of compensation is considered fair and reasonable?
Correct
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
The maximum amount of compensation (stated as a percentage of the dollar amount of the offering proceeds) that is considered fair and reasonable generally will vary directly with the amount of risk to be assumed by participating members and inversely with the dollar amount of the offering proceeds.Incorrect
5110. Corporate Financing Rule — Underwriting Terms and Arrangements
Underwriting Compensation and Arrangements: Amount of Underwriting Compensation
The maximum amount of compensation (stated as a percentage of the dollar amount of the offering proceeds) that is considered fair and reasonable generally will vary directly with the amount of risk to be assumed by participating members and inversely with the dollar amount of the offering proceeds.