Delaware Rule 144 Seller's Representation Letter Non-Affiliate

• Category: Letters - Seller's Representation
• State: Multi-State
• Control #: US-1044BG
• Format: Word; Rich Text

Description

When you acquire restricted securities or hold control securities, you must find an exemption from the SEC's registration requirements to sell them in a public marketplace. Rule 144 allows public resale of restricted and control securities if a number of conditions are met. Restricted securities are securities acquired in unregistered, private sales from the issuing company or from an affiliate of the issuer. Investors typically receive restricted securities through private placement offerings, Regulation D offerings, employee stock benefit plans, as compensation for professional services, or in exchange for providing "seed money" or start-up capital to the company An affiliate is a person, such as an executive officer, a director or large shareholder, in a relationship of control with the issuer. Control means the power to direct the management and policies of the company in question, whether through the ownership of voting securities, by contract, or otherwise. If you buy securities from a controlling person or "affiliate," you take restricted securities. Attorneys, transfer agents and brokers must be certain that all of the conditions of Rule 144 are met prior to taking action to remove a restrictive legend, but only the Seller can ensure that all the conditions are present at the actual time of sale. In order to protect themselves in issuing opinion letters and removing legends, transfer agents and most attorneys now require a letter from the Seller making certain representations and affirmations regarding their eligibility to rely on Rule 144 in the sale of their securities. This letter is commonly referred to as a Seller's Representation Letter. Delaware Rule 144 Sellers Representation Letter Non-Affiliate is a legal document that serves as a representation of a non-affiliate seller's compliance with the requirements set forth by Securities and Exchange Commission (SEC) Rule 144 in the state of Delaware. This letter is an essential component in the sale and transfer of restricted securities by non-affiliate shareholders. Rule 144 is an SEC regulation that provides a safe harbor exemption allowing restricted securities to be sold to the public, provided certain conditions are met. These conditions include a minimum holding period, volume limitations, manner of sale, and the filing of necessary forms with the SEC. The Delaware Rule 144 Sellers Representation Letter Non-Affiliate is specifically designed for non-affiliate shareholders seeking to sell their restricted securities in compliance with Rule 144. Affiliates, or individuals with a close relationship to the issuing company, have different requirements and, therefore, a separate representation letter. Non-affiliate shareholders must provide detailed information in the Delaware Rule 144 Sellers Representation Letter Non-Affiliate. This includes but is not limited to: 1. Shareholder Information: The letter must clearly state the identity of the seller, including their legal name, address, contact information, and any necessary identification numbers or codes. 2. Relationship with the Company: The seller must declare their non-affiliate status and outline their relationship or lack thereof with the issuing company. 3. Holding Period: Non-affiliate sellers must confirm that they have held the securities for the required minimum holding period specified by Rule 144, typically six months or one year, depending on the company's reporting status. 4. Compliance with Volume Limitations: The letter should include an assurance that the proposed sale does not exceed the maximum number of shares or specified percentage of the average weekly trading volume as mandated by Rule 144. 5. Manner of Sale: Sellers must specify the proposed manner of sale, such as a private transaction or through a registered broker-dealer. Additionally, any sales must not be part of a distribution plan. 6. Filing Requirements: Non-affiliate sellers are responsible for submitting any required notices or filings with the SEC, ensuring compliance with all reporting obligations. It's important to note that while the content of the Delaware Rule 144 Sellers Representation Letter Non-Affiliate may vary slightly depending on individual circumstances, the aforementioned key points must be addressed to provide the necessary assurances of compliance with Rule 144. In conclusion, the Delaware Rule 144 Sellers Representation Letter Non-Affiliate is a crucial document in facilitating the sale of restricted securities by non-affiliate shareholders in compliance with SEC Rule 144. It ensures that the seller meets the necessary requirements, thus providing a legally sound process for the transfer of securities.

Delaware Rule 144 Sellers Representation Letter Non-Affiliate is a legal document that serves as a representation of a non-affiliate seller's compliance with the requirements set forth by Securities and Exchange Commission (SEC) Rule 144 in the state of Delaware. This letter is an essential component in the sale and transfer of restricted securities by non-affiliate shareholders. Rule 144 is an SEC regulation that provides a safe harbor exemption allowing restricted securities to be sold to the public, provided certain conditions are met. These conditions include a minimum holding period, volume limitations, manner of sale, and the filing of necessary forms with the SEC. The Delaware Rule 144 Sellers Representation Letter Non-Affiliate is specifically designed for non-affiliate shareholders seeking to sell their restricted securities in compliance with Rule 144. Affiliates, or individuals with a close relationship to the issuing company, have different requirements and, therefore, a separate representation letter. Non-affiliate shareholders must provide detailed information in the Delaware Rule 144 Sellers Representation Letter Non-Affiliate. This includes but is not limited to: 1. Shareholder Information: The letter must clearly state the identity of the seller, including their legal name, address, contact information, and any necessary identification numbers or codes. 2. Relationship with the Company: The seller must declare their non-affiliate status and outline their relationship or lack thereof with the issuing company. 3. Holding Period: Non-affiliate sellers must confirm that they have held the securities for the required minimum holding period specified by Rule 144, typically six months or one year, depending on the company's reporting status. 4. Compliance with Volume Limitations: The letter should include an assurance that the proposed sale does not exceed the maximum number of shares or specified percentage of the average weekly trading volume as mandated by Rule 144. 5. Manner of Sale: Sellers must specify the proposed manner of sale, such as a private transaction or through a registered broker-dealer. Additionally, any sales must not be part of a distribution plan. 6. Filing Requirements: Non-affiliate sellers are responsible for submitting any required notices or filings with the SEC, ensuring compliance with all reporting obligations. It's important to note that while the content of the Delaware Rule 144 Sellers Representation Letter Non-Affiliate may vary slightly depending on individual circumstances, the aforementioned key points must be addressed to provide the necessary assurances of compliance with Rule 144. In conclusion, the Delaware Rule 144 Sellers Representation Letter Non-Affiliate is a crucial document in facilitating the sale of restricted securities by non-affiliate shareholders in compliance with SEC Rule 144. It ensures that the seller meets the necessary requirements, thus providing a legally sound process for the transfer of securities.