When an affiliate sells the issuer`s equity securities, whether restricted or not, the number of securities sold in a three-month period is limited. Sales of securities cannot exceed the greater of: An affiliate of the issuer that resells securities under Rule 144 must comply with an existing public disclosure requirement, volume restriction, method of sale requirements (for equity securities) and the requirement to file a Notice of Sale on Form 144. An affiliate that resells restricted securities must also respect a holding period of six months or one year. In general, Rule 144 requires that restricted securities be held for a certain period of time and prescribes the conditions that must be met before the securities are sold. The rule also distinguishes between securityholders who are affiliates of the company and those who do not, and between companies that publicly report information and those that do not. Finally, information on certain sales under Rule 144 must be provided on Form 144. If you wish to sell your restricted or controlled securities to the public, you may meet the conditions set out in Rule 144. The rule is not the only way to sell restricted or controlled securities, but provides an exemption from the safe harbor for sellers. The five terms of the rule are summarized below: The version for the revisions to Rules 144 and 145 can be found on the SEC`s website under www.sec.gov/rules/final/2007/33-8869.pdf. (B) the transaction may be declared risk-free in accordance with the rules of a self-regulatory body; and (2) Form 144 must be signed by the person on whose behalf the securities are to be sold and must be subject to the filing with a dealer of an order to execute a sale of securities under this rule or directly with a market maker when executing such a sale. Neither the filing of such a notice nor the failure of the Commission to comment on such a notice shall prevent the Commission from taking the measures it considers necessary or appropriate with respect to the sale of the securities covered by the notice.
The person filing the notice required by this subsection intends in good faith to sell the securities referred to in the notice within a reasonable time after the date of filing of the notice. (iii) The average weekly volume of transactions in such securities reported in accordance with an effective transaction reporting plan or an effective plan of the national market system as defined in Article 242.600 of this Chapter during the four-week period referred to in paragraph (e)(1)(ii) of this Section. The SEC`s Corporate Finance Division is pleased to help small businesses answer questions about SEC changes and proxy rules. The Division`s Office of the Chief Counsel will respond to questions submitted online or by calling (202) 551-3500. Questions regarding other business financing issues affecting small businesses can be directed to the Department`s SME Policy Office using the online form above or by calling (202) 551-3460. (3) “Form 10 Information” means the information required under Form 10 or Form 20-F (section 249.210 or section 249.220f of this Chapter), as the case may be, applicable to the issuer of the securities, to register under the Exchange Act any class of securities sold under this Rule. The issuer may submit the information on Form 10 in any communication from the issuer to the Commission. The information on form 10 shall be deemed to have been submitted at the time of the first notification to the Commission. 1 This guide has been prepared by staff of the U.S. Securities and Exchange Commission as a Small Entity Compliance Guide pursuant to Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996, as amended.
The guidelines summarize and explain the rules adopted by the SEC, but do not replace a rule itself. Only the rule itself can provide complete and definitive information about its requirements. Rule 144A is an SEC rule that allows qualified institutional buyers (QIBs) to trade private securities with each other. It was revised in 2013 to allow for the use of general solicitation as long as buyers are limited to QIBs. Rule 144A increased the liquidity of private securities by allowing companies to list them and trade with each other, thereby circumventing restrictions designed to protect the public. (ii) the average weekly volume reported of transactions in those securities on all national stock exchanges and/or reported through the automated quotation system of a securities association registered during the four calendar weeks preceding the submission of the notification referred to in point (h) or, where such notification is not required; the date of receipt by the broker of the order to execute the transaction or the date of execution of the transaction; directly from a market maker, or The average weekly volume of weekly reported transactions in the security during the four calendar weeks prior to the announcement of the sale (either reported by the automated quotation system of a registered securities association or on all national stock exchanges). (ii) securities purchased by the issuer that are subject to the resale restrictions of section 230.502(d) under Regulation D or section 230.701(c); If you need to follow Rule 144, a good rule of thumb is to check with your broker if they accept restricted and/or controlled securities and can meet the requirements of Rule 144 if you want to sell. To do this, your broker will likely need to coordinate with the issuer`s general counsel to verify compliance with all trading windows and withdraw consent to remove the restrictive stamp (a stamp or statement on a share certificate indicating that securities are not registered or restricted) from your securities, if applicable.
Your restricted titles cannot be sold until the restrictive stamp has been removed. Your broker may also be able to help you complete and submit your Form 144 to complete your sale transaction. (1) If the amount of securities to be sold under this rule in any three-month period exceeds 5,000 shares or other shares or has a total sale price greater than $50,000, three copies of a Notice on Form 144 (§ 239.144 of this chapter) shall be submitted to the Board.