Resales of Securities by Control Persons

What this video covers

• Why the Securities Act of 1933 underwriter definition is the mechanical reason control persons cannot freely resell
• The facts-and-circumstances test for affiliate status: control, not ownership percentage, is the ultimate test
• Why officers and directors are presumed affiliates regardless of how tiny their holdings are
• How the four resale paths map to buyer type: restricted-share safe harbor for retail, qualified institutional buyer (QIB) private resale for institutions, registered resale for massive blocks, and offshore safe harbor for non-U.S. persons
• The restricted-share safe harbor volume cap: the greater of 1% of outstanding shares or the four-week average weekly trading volume, aggregated over a strict three-month window
• The two filing thresholds that trigger Form 144: greater than 5,000 shares or greater than $50,000 in any three-month period
• Why registered resale on Form S-1 or Form S-3 removes the underwriter problem entirely but costs a fortune and destroys privacy