Rule 144
Rule 144 Opinions & 144A Offerings
Legal opinions and compliance guidance for resales of restricted and control securities.
Reselling restricted securities
Securities acquired in a private placement are restricted and cannot simply be resold into the public market. Rule 144 provides a safe harbor that permits resale without registration when its conditions are met.
Those conditions depend on whether the issuer is an SEC reporting company and whether the seller is an affiliate. Transfer agents and brokers generally will not process a restricted-stock transaction without an opinion of counsel.
We issue Rule 144 opinion letters and advise shareholders, issuers and transfer agents on what the rule permits in a given transaction.
How Rule 144 works
01
Holding period
Generally six months for restricted securities of a reporting company, twelve months for a non-reporting issuer.
02
Current public information
Adequate current information about the issuer must be publicly available at the time of sale.
03
Volume limitations
Affiliates are limited in how much they may sell in any three-month period. Non-affiliates generally are not.
04
Manner of sale
Affiliate sales of equity securities must generally go through ordinary brokers’ transactions.
05
Form 144 filing
Affiliates file a Form 144 when sales exceed the share or dollar thresholds in a three-month period.
06
Rule 144A resales
A separate safe harbor for resales of eligible securities to qualified institutional buyers.
Opinion and compliance services
Rule 144 opinion letters
Written opinions that transfer agents and brokers accept to remove restrictive legends.
Affiliate compliance
Guidance on volume limits, manner of sale and Form 144 filing.
Transfer agent coordination
Working directly with transfer agents and custodians to clear positions.
Rule 144A offerings
Structuring and documenting institutional resales to QIBs.
Related insight
Regulatory
Restricted stock can be sold, eventually. The timing depends on the issuer, and the conditions depend on whether you are an affiliate.
Need a Rule 144 opinion?
Schedule a consultation to review your holding period, affiliate status and options.
