The SEC Division of Corporate Finance (the "Division") granted no-action relief allowing a company's common stock to be issued as part of a class action settlement without registration under the Securities Act.
According to a letter sent to the Division, the clinical-stage biopharmaceutical company SELLAS Life Sciences Group, Inc. plans to issue $1,250,000 in shares of common stock (the "Settlement Stock") to a settlement fund as part of a class action. The Division stated that it will not recommend enforcement if the Settlement Stock is issued without registration in reliance on Securities Act Section 3(a)(10). The Division stated it does not view the Settlement Stock as "restricted securities" within the meaning of Securities Act Rule 144(a)(3).
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