Rule 144 financial definition of Rule 144
Restricts solicitation of buyers
to complete the sell order
of an insider
(unless the firm is already a buyer
); signified by a flashing "E" on Quotron.
An SEC rule that permits a corporate executive who owns a large amount of his or her firm's stock that has not been bought in the open market to sell a portion of the stock every six months following a holding period of two years without having to file a formal registration statement with the SEC.
References in periodicals archive
On March 14, 2016, the staff of the Securities and Exchange Commission (SEC) issued an interpretative letter providing that a stockholders Rule 144
holding period for shares of common stock of a publicly traded real estate investment trust (REIT) acquired in exchange for privately placed units of the REITs operating partnership (OP Units) commences with the shareholders acquisition of the OP Units, not the later acquisition of the REIT shares.
Two common restrictions placed on the sale of stock acquired through the exercise of nonstatutory options are SEC Rule 144
and Section 16(b) of the Securities Exchange Act of 1934.
Absent a lock-up agreement, the unregistered shares can be sold into the marketplace over a period of time, and the rule which governs their sale is known as Rule 144