Series 79 practice questionmediumRule 144
An affiliate of a public company wants to sell restricted stock under Rule 144. Which must be met for the sale to qualify?
- AThe affiliate needs no holding period if the company is current in SEC filings.
- BThe affiliate must adhere to volume and manner-of-sale limitations.✓ Correct answer
- CNo limitations apply if the shares were acquired on the open market.
- DOnly non-affiliates are subject to Rule 144’s restrictions.
Explanation
Why B — The affiliate must adhere to volume and manner-of-sale limitations.
Affiliates must comply with volume limits and manner-of-sale rules for restricted stock sales. Only non-affiliates selling after one year are exempt from these limitations.
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