What is a Rule 144 restriction?
Rule 144 is the most common exemption that allows the resale of unregistered securities in the public stock market, which is otherwise illegal in the U.S. The regulation gives a specific set of conditions that a shareholder must meet in order to sell unregistered, “restricted,” or “controlled” securities in the public …
Who has to file a Form 144?
the SEC
Form 144, required under Rule 144, is filed by a person who intends to sell either restricted securities or control securities (i.e., securities held by affiliates. Form 144 is notification to the SEC of this intention to sell and must take place at the time the sell order is placed with the broker-dealer.
What securities offering must be registered with the SEC Rule 144?
If you are an affiliate, you must file a notice with the SEC on Form 144 if the sale involves more than 5,000 shares or the aggregate dollar amount is greater than $50,000 in any three-month period.
Who is considered an affiliate under Rule 144?
Rule 144 at (a)(1) defines an “affiliate” of an issuing company as a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such issuer.”
Who is an affiliate for Rule 144 purposes?
Does Rule 144 apply to non affiliates?
A non-affiliate of a non-reporting issuer must hold the securities for one year before any public resale. After one year, a non-affiliate may freely resell such securities without regard to any of the Rule 144 conditions.
Does Rule 144 apply to foreign private issuers?
For affiliates of foreign private issuers, which are not subject to Section 16 of the Exchange Act, a Form 144 is the only public disclosure the affiliate seller may be required to make at or around the time of sale.
What is a stock opinion letter?
Legal opinion letters are issued to transfer agents on behalf of holders of restricted stock seeking to sell the stock freely in the public markets. Transfer agents typically require a lawyer’s opinion explaining the legal basis for lifting the restriction on the stock and allowing it to be freely traded.
How much would you charge for a Rule 144 opinion?
Rule 144 Opinion for a Non-Affiliate of a Non-Reporting Company who has held restricted common stock for one year or more – $250 Must have current information publicly (such as OTCMarkets). Rule 144 Opinion for an Affiliate of a Reporting Company* who has held restricted common stock for six months or more – $350
What is Rule 144 filing?
Rule 144 provides an exemption from registration requirements to sell the securities through public markets if a number of specific conditions are met. The regulation applies to all types of sellers, in addition to issuers of securities, underwriters and dealers.
What is a Rule 144 opinion letter?
Rule 144 Opinion Letters. These requirements include that the Issuer no longer be a shell company, is subject to the reporting requirements of the Exchange Act for 12 months following the time that it filed Form 10 information indicating it was no longer a shell company, and is current with all Exchange Act reporting requirements.
What are Rule 144 securities?
Rule 144. Control securities are those securities held by an affiliate of the issuing company, and restricted securities are securities acquired in unregistered, private sales from the issuing company or from an affiliate of the Issuer.