Question

Securities can be sold before the effective date of the registration statement without restrictions.
True or False?

Answer 1

False !!

Securities sold on behalf of a subsidiary of the registrant ... May sell the shares without restriction ... statement and may be used prior to the effective date of the registration statement.

A Section 12 violation results from making a material misstatement in a registration statement. Selling securities before the effective date of the registration statement is a Section 12 violation.