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A. Restricted securities are stocks, warrants or other securities that are acquired directly or indirectly (for example by gift) from a public or private company or from an affiliate of the company in a transaction that is not registered by the SEC, and is also known as a private offering. For example, restricted stock can be acquired through corporate mergers, exercise of stock options, as bonus shares, or as compensation for services provided, but not through a public offering.
Restricted securities are not registered with the SEC and can usually be identified by a legend on the stock certificate restricting the manner of the sale. Sale of the shares will depend on how and when the securities were acquired. Sometimes there is a contractual restriction, such as a lock up agreement which further restricts the resale of the stock.
No. An employee stock option refers to the right to purchase a certain number of shares of your company’s stock at a pre-established price over a defined period of time. Stock acquired in this manner may or may not be restricted.
Restricted stock is usually acquired through:
A control person, or affiliated person, is an individual in a position to exert direct influence on the actions of an issuer. For example, officers, directors, policy-making executives, major shareholders (generally own 10% or more of outstanding shares), and other people who are in a position to directly or indirectly control the management of the company are considered control persons. This includes spouses, family members who live with them, and other entities such as trusts or corporations affiliated with control persons, as defined in Rule 144.
ale of an issuer’s securities by a control person or an insider of the issuer is subject to restrictions, regardless of whether the security is restricted or purchased in the market. A control person must complete Rule 144 documentation and comply with Rule 144 when selling control stock. Control securities are securities acquired by control persons or affiliates as described in this section.
Once you have initiated the sales process, you can call our Control and Restricted Stock Specialists at +1 (914) 455 0322 or send us a message. They will be able to provide you with the status of your transaction.