_____ Sonex plans to "go public" by registering 100,000 shares of its common stock with the SEC under the 1933 Act. Immediately prior to the issuance of these new shares, Sonex had 600,000 common shares outstanding (400,000 shares held by Sonex's founders, 150,000 shares held by an insurance company [as a result of private placement] and 50,000 held by employees [as a result of exercising stock options]). How many of Sonex's common shares can be publicly traded immediately after Sonex goes public (assuming that Sonex files the appropriate 1934 Act Form)?

Question

Quizplus · Accepted Answer

Only the 100,000 new shares registered under the 1933 Act can be publicly traded immediately after the company goes public, assuming the appropriate 1934 Act Form is filed. The other shares (held by founders, an insurance company, and employees) are not mentioned as being registered for public trading at this time.

_____ Sonex Plans to "Go Public" by Registering 100,000 Shares