Rule 144 Restricted Stock

Standard Legend for Restricted Securities

The standard legend for restricted securities appears on the certificates of the Company's stock that are restricted as defined by Rule 144 of the 1933 Act.

Guidelines under the new Rule 144 adopted by the Securities and Exchange Commission

Please see the important changes to Rule 144 below:

For Non-Affiliates of a Reporting Company :

Must hold the restricted security for six months from the date of acquisition
After six months, but before one year:
- resales permitted in accordance with current public information requirement.
- an opinion of company counsel is required or the company may authorize an outside legal opinion.
- Broker representation letter required.
- Stock must be placed in a broker name.
- No Form 144 Required.
After one year:
- unlimited resales permitted
- an opinion from company counsel is required or an outside legal opinion may be authorized by the company.

For Non-Affiliates of a Non-Reporting Company:

Must hold the restricted security for one year
After one year:
- unlimited resales permitted.
- an opinion from company counsel is required or an outside legal opinion may be authorized by the company.
No Form 144 required
Company authorization to remove legend is required unless the request is from company counsel.

For Affiliates of a Reporting Company:

Must hold the restricted security for six months from the date of acquisition.
Thereafter, limited resales permitted, subject to all Rule 144 requirements, including:
- current public information
- volume limitations
- brokered sale
- opinion of company counsel required or the company may authorize an outside legal opinion.
Filing of Form 144 required if threshold is met

For Affiliates of a Non-Reporting Company:

Must hold the restricted security for one year from the date of acquisition.
Thereafter, limited resales permitted, subject to all Rule 144 requirements, including:
- current public information
- volume limitations
- brokered sale
- an opinion from company counsel is required or an outside legal opinion may be authorized by the company.
Filing of Form 144 required if threshold is met

Shell Companies Cannot Use Rule 144

The Company cannot be a considered a "shell" company for at least one year prior to the request.
After one year as a shell company, normal procedures apply (opinion, company authorization, etc.)