Dorsey partner Bryn R. Vaaler discussed in Securities Law 360 amendments to Rule 144 of the Securities Act of 1933. Rule 144 is the primary legal means, without Securities Act registration, by which (1) an affiliate of the issuer may resell any securities of the issuer into the public market, and (2) anyone may resell "restricted securities" into the public market.
Vaaler called the rule changes, which went into effect February 15, 2008, the most significant in over a decade. "These amendments ... are likely to have a significant impact on the terms and structuring of [exempt] financings and [business combination] transactions by decreasing incentives for Securities Act registration generally, making Rule 144A, PIPES and other exempt financings more attractive and reducing or eliminating the need for onerous registration rights."
The full article is available at the PDF link above.
"SEC Rule Amendments Will Add New Liquidity" was published by Securities Law 360, February 14, 2008. Republished with permission.