The Alameda California 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 is a legal provision that restricts the transferability of stock ownership in a corporation based in Alameda, California. This legend appears on the stock certificate of a company that has entered into a stock redemption agreement. Under this stock redemption agreement, if a stockholder wishes to transfer their shares, they must first offer the stock to the corporation. If the corporation declines the offer, only then can the stockholder make an offer to other existing stockholders. This process ensures that the corporation has the first opportunity to repurchase its own stock before it can be transferred to other shareholders or external parties. The primary purpose of this restriction is to provide the corporation with a mechanism to control and regulate the ownership of its shares. By having the option to repurchase its stocks, the corporation can maintain stability and prevent unwanted or unsuitable individuals from acquiring significant ownership positions. The Alameda California Legend may have different variants based on specific circumstances or variations in the stock redemption agreement. These can include specific timelines within which the corporation needs to respond to the initial offer, the conditions under which the corporation can decline the offer, and whether the stockholder is obligated to sell to the corporation before offering to other stockholders. The legend serves as a notice to potential buyers and subsequent holders of the stock certificate, informing them of the existence of this restriction on transfer. It acts as a legal safeguard so that both the purchaser and the seller are fully aware of the stock's limitations even after the transfer of ownership occurs. Overall, the Alameda California 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 ensures that the corporation has the first right of refusal before shares can be transferred, providing a level of control and protection for the company and its stakeholders.
Alameda California 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
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FAQ
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.
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.
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.
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.
A legend is a statement on a stock certificate noting restrictions on the transfer of the stock. A stock legend is typically put in place due to the requirements established by the Securities and Exchange Commission (SEC) for unregistered securities.
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
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.
The restrictive legend can only be removed by a transfer agent, who will typically require an opinion letter from the legal counsel of the issuing party.
