SVbiz Law Offices of
Thomas Gross


  San Jose Solid circle Silicon Valley
Corporate, Business, Contracts, M&A, Securities (408) 377-4178   Solid circle

Restricted Stock Transfers and Rule 144 Opinions of Counsel

Stock Legend Removal by Securities Lawyer and Business Attorney

Our attorneys can help you take steps necessary to transfer shares of restricted stock.  We can help provide you with an opinion of counsel or legal opinion and supporting documentation as required in order to remove restrictions on the stock.  If you own shares of stock in a private company, typically these shares will be restricted.  Public company shares that were received directly from the company (e.g. merger or acquisition, employee plan) may also be subject to restrictions.

If you want to transfer these shares to a third party, restrictions on a stock can be an obstacle to such transfer.  Generally, you will find the specific restrictions set forth on the back of the stock certificate.  These are often referred to as stock legends.  You may also find restrictions set forth in the agreement which documented your acquisition of the shares.  If you purchased your shares directly from the company, this agreement is usually referred to as the "Stock Purchase Agreement."

To remove restrictions, you need to comply with the transfer rules set forth by the SEC.  The most familiar rule is Rule 144 which requires a minimum holding period of one year and the filing of a Form 144.  There are  limitations on the number of shares that you can transfer.  There are also special requirements that apply to officers, directors and control persons.   If Rule 144 is not applicable, there may be other SEC statutes which may permit the transfer.

Because the rules are highly technical, many companies require that you obtain an opinion of counsel in order to permit the transfer.  Our lawyers are experienced with drafting the necessary opinion and supporting documentation.  If you would like to transfer restricted stock, please contact us.  

We also provide special programs designed for large groups such as corporations, brokers and investment managers who may have many clients with restricted stock.  We offer discounted group rates and a customized group portal to provide information to the clients and handle the administrative aspects.

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