What is an affiliate under SEC rules?

The term “affiliate” is defined in Rule 405 under the Act as a “person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with,” an issuer.

Does Rule 144 apply to non affiliates?

A non-affiliate of a non-reporting issuer must hold the securities for one year before any public resale. After one year, a non-affiliate may freely resell such securities without regard to any of the Rule 144 conditions.

What is an affiliate of a public company?

Affiliated persons who own 20% of the company or more or have voting power equal to that percentage are considered affiliates. 3 In other words, an affiliate is a company or individual that owns 20% of a company.

Is an executive officer an affiliate?

In general, directors, executive officers and shareholders who have the power to influence or affect corporate affairs are “affiliates.”

What defines an affiliate?

What Is an Affiliate? Affiliate is used primarily to describe a business relationship wherein one company owns less than a majority stake in the other company’s stock. Affiliations can also describe a type of relationship in which at least two different companies are subsidiaries of the same larger parent company.

Is a spouse an affiliate?

Family Affiliate means the spouse, civil partner, ascendants and descendants of any Seller (each a “Family Member”), and any Entity that is directly or indirectly through one or more intermediaries Controlled by a Seller or by a Family Member, either alone or jointly with the relevant Seller.

Is a control person an affiliate?

What are control securities? Control securities are securities owned by any person who directly or indirectly controls the issuer – either alone or as a member of a control group. The SEC uses the term “affiliate” to describe such a control person.

What is a 144 offering?

A Rule 144A equity offering is an unregistered offer and sale of equity securities issued by a U.S. or foreign company, the equity securities of which are neither listed on a U.S. securities exchange nor quoted on a U.S. automated inter-dealer quotation system.

What is tacking under Rule 144?

Generally, the “tacking” concept of Rule 144 permits a holder of restricted securities to aggregate the separate holding periods of prior owners of the restricted securities in order to satisfy the holder’s applicable holding period requirement.

What is the rule of 144?

Rule 144 is a regulation enforced by the U.S. Securities and Exchange Commission that sets the conditions under which restricted, unregistered, and control securities can be sold or resold. Rule 144 provides an exemption from registration requirements to sell the securities through public markets if a number of specific conditions are met.

What is a Rule 144 opinion letter?

Rule 144 Opinion means an opinion letter prepared by legal counsel of Holder’s choice, which is reasonably acceptable to the Company, stating that the subject securities of the Company may be resold by the Holder without registration in reliance of Rule 144 promulgated under Securities Act of 1933, as amended.

What is SEC Form 144?

Form 144 is a financial form in the United States that must be filed with the Securities and Exchange Commission whenever an executive, affiliated person or company plans to sell restricted shares of stock. The form deals exclusively with restricted shares.