Rule 145

What Is Rule 145?

Rule 145 treats specified security substitutions submitted for shareholder vote or consent as offers or sales. It covers certain reclassifications, mergers/consolidations and asset transfers. Registration or an available exemption must be considered.

Important Distinctions

• A vote alone does not make every corporate action a registrable offering.
• Stock splits, reverse splits and par-value changes are excluded from the specified reclassification category.
• Available statutory exemptions remain available. There is no general $5 million or nonpublic-company exemption created by Rule 145.
• Registration may use Form S-4 or F-4, with appropriate shareholder disclosure.

Resales

The rule's deemed-underwriter provisions now focus on transactions involving specified shell companies, excluding a business-combination-related shell company. They do not automatically restrict every affiliate receiving merger shares.

Persons covered by those provisions must satisfy the applicable resale conditions. There is no universal six-month waiting period for all non-affiliate recipients of registered merger shares. Other affiliate, restricted-security, contract or registration requirements may still apply.

Current Rule 145