What are Control Securities?

Control Securities are Held By Affiliates Under Rule 144

Control securities are those held by an Affiliate of the Issuer. An Affiliate is a person, such as an Officer, Director or Shareholder owing greater than 10% of the issued and outstanding shares, and is presumed by the SEC to be in a position or relationship of control over the Issuer.  

Under Rule 144 A Control Person Has the Power to Direct the Policies of the Issuer

Under Rule 144, the term “control” is defined as the power to direct the management and policies of the Issuer, either by voting rights, under a contract or agreement, or in any other manner. 

Buyers of 144 Stock from Affiliates Receive Restricted Stock

The important part for buyers of OTC Bulletin Board and OTC Pink Sheets stock to know is that under Rule 144, if you purchase stock from an Affiliate in a private sale, you receive restricted stock.  This is true even if the Affiliate had purchased the stock on the open market.  For this reason, a crucial element of a Rule 144 legal opinion is the Affiliate status of the Shareholder and all prior holders of the stock.


Fatal error: Allowed memory size of 67108864 bytes exhausted (tried to allocate 16 bytes) in /home/content/09/8876609/html/restrictedstockopinion/wp-includes/wp-db.php on line 1780