A Restriction That Prevents Existing Shareholders from Selling Their Shares

question 103

Multiple Choice

A restriction that prevents existing shareholders from selling their shares for some period after an IPO is called:

• A)a greenshoe provision.
• B)book building.
• C)a secondary offering.
• D)a lockup.
• E)a red herring.

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Definitions:

Corporation's Welfare

The overall health, well-being, and prosperity of a corporation, often considered in terms of financial success and sustainability.

Conflict Of Interest

A situation in which a person's private interests might interfere, or appear to interfere, with their professional responsibilities or duties.

Full Disclosure

This principal mandates that all pertinent and significant information must be revealed in financial reporting or in transactions to ensure transparency and fairness.

Executive Committee

A smaller group of decision-makers within a larger organization or board, tasked with managing various aspects of the organization's operations.