Rule 145 is complex and incongruous with the general congressional intention of the 1933 Act. Thus, it involves the following theoretical and practical problems. First, Rule 145(a) fails to provide a clear standard for determining whether a certain recapitalization or reorganization involves a sale to trigger registration requirements...Second, Rule 145(c) and (d), as special resale provisions for “securities acquired in a Rule 145 transactions” (hereinafter Rule 145 securities), are inconsistent with general resale provisions under the 1933 Act. The SEC’s authority to establish Rule 145 was mandated by provisions of the 1933 Act. Accordingly, the resale provisions of Rule 145 cannot deviate from the general resale rules under the 1933 Act...(c) unreasonably restricts the resale of Rule 145 securities. Finally, ambiguous and inconsistent SEC interpretations concerning Rule 145 impede efficient market pricing and increase transaction costs. Basically, market liquidity for securities maintains the efficiency of stock pricing...The above-mentioned problems with Rule 145 appear at every stage of a Rule 145 type transaction: reckless issuance of no-action letters at a business planning stage, inconsistent standards for determining a “sale” at a registration stage, and over-extension of the “underwriter” concept at a resale stage. This article will analyze problems shown in every stage of a Rule 145 transaction.
Kim, Kab Lae
"A Study on Rule 145 of the Securities Act of 1933: How to Provide Clarity and Predictability in Rule 145 Transactions,"
Akron Law Review: Vol. 40
, Article 4.
Available at: http://ideaexchange.uakron.edu/akronlawreview/vol40/iss1/4