Question

An accurate description of a tombstone ad is a/an _____

group of answer choices
A. announcement issued by the securities and exchange commission (sec) warning potential investors that a company is being investigated for fraud.
B. clarification of supplied information needed to complete a filed registration statement.
C. announcement of the public offering of securities run during the waiting period.
D. statement that is required to be filled with the securities and exchange commission (sec).
D. notice filed during the posteffective period announcing that the sale of securities has ended.

Answer 1

A tombstone ad is an announcement of a public offering of securities run during the waiting period before an offering has been approved by the SEC. It is characterized by its austere design and minimal information, primarily serving as a notice of the offering rather than a solicitation to buy. The correct answer is option C.

Step-by-step explanation:

An accurate description of a tombstone ad is C. an announcement of the public offering of securities run during the waiting period. A tombstone ad is a specific type of advertisement that is used in the financial industry to announce a securities offering. Unlike traditional advertisements, a tombstone ad provides minimal information and typically includes the name of the issuing company, the type of securities being offered, and a list of the underwriting banks involved in the distribution.

The term 'tombstone' comes from the ad's simple and austere appearance, which resembles a tombstone. It is important to note that a tombstone ad is not an offer to sell or a solicitation to buy securities. Rather, it serves as a notice that an offering is being made, and it often appears during the so-called 'quiet period' when a company has filed with the Securities and Exchange Commission (SEC) but before the SEC has approved the offering for sale to the public.