David Feldman's book, Reverse Mergers: Taking a Company
Public Without an IPO, now in its third printing, was published in 2006
by Bloomberg Press (available on http://www.amazon.com).
View David Feldman's reverse merger blog at www.reversemergerblog.com.
Joseph Smith and David Feldman are coauthors of PIPES:
Revised and Updated Edition - A Guide to Private Investments in Public Equity
(Bloomberg Press, 2005) available on http://www.amazon.com.
In the News
SEC
Asked for Guidance on Trading Restriction
for Former Shells
PIPEWire
(July 01, 2008)
Securities
attorney David Feldman is asking the
Securities and Exchange Commission to
provide guidance on what he calls the
"scarlet letter" for shell
companies that was introduced in recent
changes to Rule 144 of the Securities
Act.
Feldman,
partner at Feldman Weinstein & Smith,
told PIPEwire that he has submitted
a request for interpretive guidance
from the SEC on the section 144(i) of
the rule change.
Changes to Rule 144, which governs when
a holder of restricted securities is
allowed to freely trade them, took effect
Feb.15. Section 144(i) states that if
a company was ever once a shell company,
and is not current with its financial
filings, then its restricted securities
can never be freely traded.
PIPE investors have said that the restriction
discourages them from investing in companies
that are former shells.
The
SEC may not have intended to make the
rule retroactive, Feldman said.
The commission may issue guidance saying
the rule does not apply to companies
that ceased to be a shell prior to Feb.
15.
A group of attorneys – Brett Director
of Schulte Roth & Zabel, Michael
Maline of Goodwin Proctor, and Carol
McGee of Alston & Bird – spoke
about the subject during a recent online
seminar. They agreed that having the
rule not be retroactive would be preferable
to the current interpretation of the
rule, but that an immediate change is
unlikely.
"Ultimately this will be changed
I think, whether its six months or three
years I'm not sure," said Feldman.
