Cooling Off Period

Definition - What does Cooling Off Period mean?

Cooling-off-period the period of time between the filing of a registration statement and its effective date. During this time, the SEC is reviewing the registration statement and no sales may take place. The cooling off period is at least 20 days.

Testopedia explains Cooling Off Period

When a corporation files a registration with the SEC in an effort to sell shares to the public, that information must be reviewed. During this time of review known as the cooling off period no sales may be made and no checks can be accepted from investors. During this time a Registered Representative may accept indications of interest and may send out preliminary prospectuses.

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