Minnesota Legend on Stock Certificate Giving Notice of Restriction on Transfer due to Stock Redemption Agreement Requiring First an Offer to the Corporation and then an Offer to other Stockholders

• Category: Corporations - Shareholders and Stock
• State: Multi-State
• Control #: US-1059BG
• Format: Word; Rich Text

Description

A Legend is a statement on a stock certificate noting restrictions on the transfer of the stock, often due to SEC requirements for unregistered securities. A stock redemption agreement is a contract between a corporation and the stockholder, where the corporation repurchases the stock from the owner The "Minnesota Legend" refers to a special notation or statement typically found on a stock certificate that informs the holder about certain restrictions on transferring the stock. Specifically, this legend indicates that the stock is subject to a stock redemption agreement, which necessitates that prior to selling the stock to any third party, the shareholder must first offer it to the corporation, and if the corporation declines the offer, to other existing stockholders. The purpose of the Minnesota Legend is to ensure compliance with the stock redemption agreement and provide adequate notice to potential buyers that the transfer of the stock is subject to certain conditions. This restriction is aimed at maintaining stability within the corporation's ownership structure and allowing existing shareholders an opportunity to retain or increase their ownership stake. Being a notice of restriction, the Minnesota Legend serves as a vital means of communication to investors and potential purchasers. It effectively safeguards the interests of the corporation and its shareholders, preventing unauthorized or uninformed transfers that could disrupt the balance of ownership. Different types of Minnesota Legends may exist depending on the specific language or provisions stipulated in the stock redemption agreement. For example, variations might include: 1. Standard Minnesota Legend: This placeholder term is used when the specific wording or language for the restriction has not been detailed. It typically references the applicable statute, regulation, or section of the law under which the restriction exists, as required by Minnesota state law. 2. Offer to Corporation Legend: This particular type specifies that the stockholder must initially present an offer to the corporation in order to transfer the shares. If the corporation does not exercise its right to redeem the stock, the shareholder may then proceed to offer the shares to other existing stockholders. 3. Offer to Stockholders Legend: This variation indicates that the shareholder must first extend an offer to all other stockholders of the corporation before being able to transfer the shares to external parties. It ensures that existing stockholders have an opportunity to maintain or increase their shareholding prior to the stock being sold to external parties. It is important for shareholders, potential buyers, and legal professionals to carefully review and understand the specific Minnesota Legend on a stock certificate as it outlines the restrictions on transfer and ensures compliance with the applicable stock redemption agreement.

The "Minnesota Legend" refers to a special notation or statement typically found on a stock certificate that informs the holder about certain restrictions on transferring the stock. Specifically, this legend indicates that the stock is subject to a stock redemption agreement, which necessitates that prior to selling the stock to any third party, the shareholder must first offer it to the corporation, and if the corporation declines the offer, to other existing stockholders. The purpose of the Minnesota Legend is to ensure compliance with the stock redemption agreement and provide adequate notice to potential buyers that the transfer of the stock is subject to certain conditions. This restriction is aimed at maintaining stability within the corporation's ownership structure and allowing existing shareholders an opportunity to retain or increase their ownership stake. Being a notice of restriction, the Minnesota Legend serves as a vital means of communication to investors and potential purchasers. It effectively safeguards the interests of the corporation and its shareholders, preventing unauthorized or uninformed transfers that could disrupt the balance of ownership. Different types of Minnesota Legends may exist depending on the specific language or provisions stipulated in the stock redemption agreement. For example, variations might include: 1. Standard Minnesota Legend: This placeholder term is used when the specific wording or language for the restriction has not been detailed. It typically references the applicable statute, regulation, or section of the law under which the restriction exists, as required by Minnesota state law. 2. Offer to Corporation Legend: This particular type specifies that the stockholder must initially present an offer to the corporation in order to transfer the shares. If the corporation does not exercise its right to redeem the stock, the shareholder may then proceed to offer the shares to other existing stockholders. 3. Offer to Stockholders Legend: This variation indicates that the shareholder must first extend an offer to all other stockholders of the corporation before being able to transfer the shares to external parties. It ensures that existing stockholders have an opportunity to maintain or increase their shareholding prior to the stock being sold to external parties. It is important for shareholders, potential buyers, and legal professionals to carefully review and understand the specific Minnesota Legend on a stock certificate as it outlines the restrictions on transfer and ensures compliance with the applicable stock redemption agreement.