Preliminary prospects. A prospectus circulated before the SEC declares the related securities registration statement to be effective. A preliminary prospectus does not include securities pricing information. After the registration statement containing the prospectus has been filed with the SEC and before it becomes effective, the issuer may begin offering to sell securities and may receive offers to buy, but may not sell or accept offers. Some state laws go further, prohibiting offers to sell or receiving offers to buy until the registration statement is effective. See "Prospectus."

Primary offering. When an issuer offers securities for sale.

Private placement. A private placement is a securities sale to an accredited investor of securities which is exempt from registration requirements. See "Accredited Investor" and "Investor Agreement."

Prospectus. A prospectus is a lengthy informational document forming the legal core of efforts to sell a security. A prospectus is technically any notice, advertisement, letter or other communication, transmitted in any manner, which offers a security for sale or confirms the sale of any security during certain time periods.

Proxy agent. A service used to coordinate proxy matters. The proxy agent coordinates with issuers and clearing agencies, and returns specially prepared proxy cards to issuers on behalf of brokers and their customers. The proxy agent also mails voting materials to the brokerage's customers and solicits instructions on how customers' shares should be voted.

Proxy. "Proxy" is used in common parlance to mean a proxy card, a proxy power, a proxy statement, or a proxy. The SEC calls the proxy card a "proxy," but the correct definition of a "proxy" is a person who stands in the place of another. In this context, a proxy is a person to whom other people have delegated the power to cast their votes at meeting in accordance with their instructions. A shareholder reviews a proxy statement, marks a proxy card, and grants a proxy power to a specified proxy.

Proxy card. The paper ballot provided to shareholders with a proxy statement. Shareholders sign the card and return it to the person who solicited it. The proxy card gives the shareholder's voting power to the proxy, who casts a vote per the shareholder's instructions. See "Proxy" and "Proxy Statement."

Proxy fight. When two or more groups, of which a corporation's management is usually one, oppose each other concerning a matter to be voted on at a meeting of the corporation's shareholders. The opposing groups each solicit proxies, hire proxy solicitors, and mail out proxy statements and cards to attract shareholders' votes to their position.

Proxy solicitation. The process by which a person requests that shareholders execute, not execute, or revoke a proxy card.

Proxy statement. A proxy statement is designed to give a voting shareholder all the information necessary to make an informed decision. It is provided to a shareholder at or before the time they are contacted in a proxy solicitation.

Public disclosure. Material that is considered disclosed in a manner sufficient to insure its availability to the investing public. Disclosure is commonly made through a periodical report, in an SEC filing, or in a press release to the major wire services. The market must have time to absorb the news before an insider may trade on the information, as trading immediately after release may violate insider trading rules.

Public offering. Any securities offering resulting in sales to more than thirty-five persons is generally considered a public offering. However, the rule is not absolute. A public offering may require filing of a registration statement under federal and state laws.

Quarterly report. "Quarterly report" refers either to a required SEC filing, or, more commonly, to a quarterly report similar to an abbreviated annual report that a company voluntarily mails to shareholders.

Quiet period. When a company is "in registration"-after a registration statement has been filed but before the SEC has declared it effective-any communication it makes can be deemed part of the prospectus. Before the effective date, companies and their underwriters are extremely careful in their statements about the company and the offering, sticking closely to the facts provided in the preliminary prospectus. During this period the company risks that any public announcement of good news, or any delay of bad news, may be seen as a manipulative tactic. Because legal counsel often discourages companies from appearing at analysts' conferences or issuing glowing press releases during this period, it is considered a quiet period. The term also can refer to the ninety-day period after an initial public offering, during which underwriters are prohibited from issuing research information about the company to reduce their opportunity to influence the aftermarket for their benefit. See "Registration."