Financing a start$-$up company

After the stock market crash in $1929,$ the Securities and Exchange Commission $($SEC$)$ was established to protect investors from fraudulent

investments and to regulate the securities industry.

Based on your understanding of SEC regulations, which of the following statements are true? Check all that apply.

The red herring prospectus can be distributed to potential investors, but the sale of the issuing company's stock cannot be finalized during

the $20-$day wait period.

As soon as a company decides to sell stock to prospective investors, it starts to advertise in order to increase the marketability of its new

shares.

The SEC does not allow companies to specify or limit which groups or types of investors to whom a company can issue securities$.$

Companies are liable for all of the information presented in the prospectus.