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CEP Level 1 Questions and Correct
Answers the Latest Update
The Exchange Act rule that prohibits trading in securities by a person having
"material non-public" information is:
✓ Rule 10b-5
Which is the statute that sets forth provisions promulgated by the Board of
Governors of the Federal Reserve System to regulate the extension of credit by
brokers and dealers in connection with the purchase or carrying of securities?
✓ Regulation T
Which agency is responsible for the provision to regulate the extension of credit
by brokers and dealers in connection with the purchase or carrying of securities?
✓ Federal Reserve
How and when do an insider's purchases under a qualified Section 423 ESPP
need to be reported to the SEC?
✓ The purchases are not required to be reported, but the insider's holdings should be
updated to reflect the purchases on the next form filed by the insider
A public company's equity plan authorizes the delivery of previously-owned
shares of stock as a payment method for option exercises. A director of the
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company takes advantage of this payment method by tendering 200 shares to
exercise 500 options. What is her reporting responsibility in connection with the
award?
✓ She must report both the exercise and the sale of the shares she used to effect the
swap on a Form 4
Shares held in a brokerage account can be voted
✓ Only by the beneficial owner
When is the grant of an equity award required to be reported for Section 16
officers, and on which form?
✓ Within 2 business days on Form 4
Broker -assisted cashless exercises can take what kind of forms:
✓ Same-day sales, sell-to-cover and promissory note
Which of the following individuals would be considered an affiliate of the issuer?
✓ All directors and certain key executive officers
During any 12-month period the aggregate sales price or amount of securities
sold in reliance on Rule 701 cannot exceed the greatest of:
✓ $1 million, 15% of the total assets of the issuer, 15% of the outstanding amount of
the class securities being offered and sold in reliance on Rule 701
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CEP Level 1 Questions and Correct
Answers the Latest Update
The Exchange Act rule that prohibits trading in securities by a person having
"material non-public" information is:
✓ Rule 10b-5
Which is the statute that sets forth provisions promulgated by the Board of
Governors of the Federal Reserve System to regulate the extension of credit by
brokers and dealers in connection with the purchase or carrying of securities?
✓ Regulation T
Which agency is responsible for the provision to regulate the extension of credit
by brokers and dealers in connection with the purchase or carrying of securities?
✓ Federal Reserve
How and when do an insider's purchases under a qualified Section 423 ESPP
need to be reported to the SEC?
✓ The purchases are not required to be reported, but the insider's holdings should be
updated to reflect the purchases on the next form filed by the insider
A public company's equity plan authorizes the delivery of previously-owned
shares of stock as a payment method for option exercises. A director of the
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, #Examify | #OnlineExams | #TestPrep | #StudyResources | #AcademicSuccess |
#ExamPreparation | #QuizTime | #LearningTools | #Education | #StudentSupport
company takes advantage of this payment method by tendering 200 shares to
exercise 500 options. What is her reporting responsibility in connection with the
award?
✓ She must report both the exercise and the sale of the shares she used to effect the
swap on a Form 4
Shares held in a brokerage account can be voted
✓ Only by the beneficial owner
When is the grant of an equity award required to be reported for Section 16
officers, and on which form?
✓ Within 2 business days on Form 4
Broker -assisted cashless exercises can take what kind of forms:
✓ Same-day sales, sell-to-cover and promissory note
Which of the following individuals would be considered an affiliate of the issuer?
✓ All directors and certain key executive officers
During any 12-month period the aggregate sales price or amount of securities
sold in reliance on Rule 701 cannot exceed the greatest of:
✓ $1 million, 15% of the total assets of the issuer, 15% of the outstanding amount of
the class securities being offered and sold in reliance on Rule 701
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