In the absence of registration under the Securities Act, unlisted or otherwise restricted securities are most often sold under Rule 144 of the Securities Act. While Rule 144 is useful, it excludes the sale of restricted securities during an applicable holding period (which is six months or one year, depending on the relevant facts) and subjects volume and sale restrictions to the sale of “controlling” securities (typically securities held by a promoter who also sits on the board of directors or holds 10% or more of the company`s shares). Other exceptions to registration may be available. However, the use of another exception would limit the pool of potential investors to institutional investors and certain other sophisticated investors and would generally lead buyers to demand a “liquidity discount” on the purchase price, as the securities are “restricted” in the hands of the buyer. Lock-Ups – How long and for which transactions? Parties to registration fee agreements are generally required to enter into a blocking agreement (especially investors with significant holdings). These agreements will block sales of securities at the time of subscription of the Company`s equity securities, including IPO-related sales and secondary sales. Promoters must ensure that blockages do not impede the possibility of selling opportunistically in open market windows, particularly given the possible interaction with suspension periods, as described above. Conversely, piggyback rights allow investors to register all non-registered shares they own, but only if the company or another shareholder initiates the process. In such a case, investors do not have as much power as those who have rights to register claims. Registration fees typically contain clauses that specify the conditions for registration. These details include the “freeze” period, during which investors are prohibited from selling their shares in a company after visiting the exchange. As a rule, this is limited to 180 days.
 There is a reverse piggyback right when investors exercise a right of claim, execution of registration at their own expense (under the Agreement) and the Company seeks to obtain the right to “piggy” certain newly issued shares upon registration of investors. See Frome & Max, Raising Capital: Private Placement Forms and Techniques, 673 (1981). Registration fees can be divided into two main categories: application fees and piggyback fees. Is your security a “recordable security”? A threshold question is whether the security held by an investor is within the scope of registration fees. Registration fees are usually limited to titles that are thought to “need” them to obtain liquidity. .