Earlier this month, FINRA responded to comments submitted regarding proposed amendments to Rule 5110 (see: https://bit.ly/2MlXCU4) and filed an amended proposal with the Securities and Exchange Commission (see: https://bit.ly/31bECMr). Exhibit 4 shows the changes proposed in this Partial Amendment No. 1 in a blacklined version.

In Partial Amendment No. 1 FINRA is, among other things:

  • Modifying the requirement to file a description of any securities of the issuer acquired and beneficially owned by a participating member during the review period,
  • Excepting actively traded securities from the 180-day lock-up restriction,
  • Clarifying the investment grade debt exemption to exempt securities offered by a bank, corporate issuer, foreign government or foreign government agency that has outstanding unsecured non-convertible debt with a term of issue of at least four years or unsecured non-convertible preferred securities that are investment grade rated or are outstanding securities in the same series that have equal rights and obligations as investment grade rated securities provided that an initial public offering of equity is required to be filed, and
  • Amending its proposed definition of a “bank,” in order to include branches or agencies of a foreign bank to make the “bank” definition consistent with the SEC’s definition.