Replies to post #4816 on Consumer Automotive Finance Inc (CAFI)

[Churak]

CMKX did it with USCA. CMKX distributed USCA shares to CMKX shareholders that are restricted for 2 years. Here, GVEI is issuing NEW shares to be distributed to NWAU shareholders & the process will be begun by filing an SB2 to get the restriction lifted. Nothing unusual about that except that your money appears to be locked in until the restriction is lifted (assuming that after the distribution of GVEI to NWAU shareholders, NWAU trades at a minimal price since it has no assets) & who knows what the price of GVEI will be then. IMHO.

[watchdog11]

Sounds fishy to me that SEC would allow publicly traded shares to essentially become restricted.

Allow it??? It's their own rule #144, they wrote it and strictly enforce it. Compliance with SEC rules, any of them, is not something that's opptional for public companies.

Rule 144
Rule that stipulates the conditions in which an unregistered security may be sold by a broker. Specific documentation must be completed by the owner and presented to a broker before a sell order can be placed. Moreover, a letter security may not be sold for at least two years from the date of purchase.

Letter Security
A security that is not registered with the SEC and thus, cannot be sold in the marketplace. The issues are sold under an investment letter in which the purchaser states the purchase is for investment purposes and not for resale. The certificates have a restrictive legend that indicates they are not registered. Because the investment letter is essential to the security's issuance, this type of security is called either "letter security", "letter stock", or "letter bond".



Dog