Can a Rule 144 Opinion Be Issued without Documentation?

No.  An experienced securities attorney cannot issue a Rule 144 legal opinion or Section 4(a)(1) opinion letter without the Shareholder providing the documentation necessary to show the origin and history of the Shares. (If any documents are missing, an experienced Rule 144 lawyer can help confirm the transaction details by emails with the Issuer and Transfer Agent, when necessary.)

What Documents are Necessary for a Rule 144 or Section 4(a)(1) Legal Opinion?

The amount of shareholder documentation needed depends on whether or not the Issuer is an SEC filer and if the Shares are referenced in SEC filings or OTC Markets disclosure statements.

The best documentation in support of a Rule 144 legal opinion letter would be the Shareholder and the Shares referenced specifically in one or more SEC filings or OTC Markets filings.

If not, then the Shareholder can provide the following documents in support of a legal opinion letter issued under Rule 144 or Section 4(a)(1):

Documentation for Rule 144 Shares Issued Under Subscription Agreement

  1. A copy of the Subscription Agreement signed by the Shareholder and the Company;
  2. A copy of the Private Placement Memorandum (“PPM”), if available;
  3. A copy of the Investor Questionnaire or other correspondence that came with the Subscription Agreement, if available;
  4. A certificate or book entry confirmation from the Transfer Agent showing the Shares issued to the Shareholder; and
  5. Proof of Payment for the Shares, which is usually a check or wire transfer confirmation.

Documentation for Rule 144 Shares Issued for Services

  1. A copy of the Consulting Agreement or other contract showing the services to be performed and compensation; and
  2. Invoices or other correspondence documenting the services;
  3. Board Resolution or Issuance Instructions showing the Shares issued for services; and
  4. A certificate or book entry confirmation from the Transfer Agent showing the Shares issued to the Shareholder.

Documentation for Rule 144 Shares Due to Debt Conversion

  1. A copy of the Promissory Note;
  2. If the Note was issued as payment for services, then also provide the invoices or agreement demonstrating the services rendered to the Company;
  3. If the Note was issued for a loan, then also provide the check or wire transfer confirmation showing Proof of Payment;
  4. Conversion Notice showing the Date of Conversion;
  5. Board Resolution or Issuance Instructions showing the Shares, (if they have already been issued); and
  6. A certificate or book entry confirmation from the Transfer Agent showing the Shares issued to the Shareholder (if they Shares have already been issued).

Shareholders Can Contact Securities Attorney Matt Stout for questions about Rule 144 legal opinions and Section 4(a)(1) opinions any time.   Shareholders ready for a no cost review of their documentation can call (410) 429-7076 or send an email to mstout@otlawyers.com.