How do I remove restricted legend from stock certificate?

If you want to remove the restrictive legend, you should contact the company that issued the securitiesor the transfer agent for the company's securitiesto ask about the procedures for removing a legend. If you have a broker, you may want to ask your broker to help you.

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Statement or Legend on Stock Certificate - Notice of Restriction on...

San Bernardino California Statement or Legend on Stock Certificate - Notice of Restriction on Transfer - Stock not Registered - Intrastate Exemption

Name: San Bernardino California Statement or Legend on Stock Certificate - Notice of Restriction on Transfer - Stock not Registered - Intrastate Exemption
Brand: US Legal Forms
Rating: 4.67 (350 reviews)

Category:

Corporations - Shareholders and Stock

State:

Multi-State

County:

San Bernardino

Control #:

US-1057BG

Format:

Instant download

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. The Securities Act of 1933 regulates the initial sale of securities to the public. Some securities are exempt from coverage of the Act. Certain stock issue transactions are also exempt (i.e., exempt from registration with the Securities and Exchange Commission). The most common exempt transaction that close corporations take advantage of is the intrastate offering. To qualify for this exemption, both the investors and the issuer must all be residents of the same state. The issuer must also meet the following requirements: • 80% of its assets must be located in the state; • 80% of its income must be earned from operations within the state; and • 80% of the proceeds from the sale must be used on operations within the state. Also, for nine months after the issuance, the stock can only be sold to state residents.

How to fill out San Bernardino California Statement Or Legend On Stock Certificate - Notice Of Restriction On Transfer - Stock Not Registered - Intrastate Exemption?

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FAQ

Restricted and unrestricted stocks are important components of corporate executive compensation packages. Restricted stocks have particular conditions that must be fulfilled before they can be transferred or sold, whereas unrestricted stocks have no such conditions. There are two types of restricted stocks.

When securities are restricted, a restrictive legend is usually stamped on the back of the stock certificate, prohibiting its sale in the public marketplace unless they are registered with the SEC or are exempt from the registration.

If you own stock in a fully reporting non-shell company, you may be eligible to sell your stock if you have beneficially owned it for more than 6 months and less than one year. In order to do this, you will need to contact your broker/dealer and they will assist you in removing the restriction.

Restrictive legends are stamped or printed on the certificate or instrument, face or reverse, of restricted securities and usually begin with These securities are not registered . . . . Restricted securities that are not represented by a certificate (generally referred to as book entry) will have a notation of

If you want to remove the restrictive legend, you should contact the company that issued the securitiesor the transfer agent for the company's securitiesto ask about the procedures for removing a legend. If you have a broker, you may want to ask your broker to help you.

Restricted stock refers to unregistered shares of ownership in a corporation that are issued to corporate affiliates, such as executives and directors. Restricted stock is non-transferable and must be traded in compliance with special Securities and Exchange Commission (SEC) regulations.

Legend Removal Period means, with respect to any securities, any period during which (a) a registration statement (including the Registration Statement) covering the resale of such securities is effective under the Securities Act, (b) such securities have been or are being sold pursuant to Rule 144 or Rule 144A and the

If you receive stock from a company affiliate -- an executive officer, director or large investor -- the shares are restricted control securities. Under SEC Rule 144, you can lift stock restrictions by holding the shares for a set amount of time.

San Bernardino California Statement or Legend on Stock Certificate - Notice of Restriction on Transfer - Stock not Registered - Intrastate Exemption

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