Rule 144 Representation Letter
(Provided by Affiliate Stockholders to Company Counsel)

Summary

This template representation letter may be used by a selling stockholder that is an affiliate of an issuer to show compliance with the requirements of Rule 144 (17 C.F.R. § 230.144) under the Securities Act of 1933, as amended (Securities Act). This template includes practical guidance and drafting notes. Restricted securities, as defined in Rule 144(a)(3) (generally, securities acquired, directly or indirectly, from the issuer or an affiliate of the issuer in a transaction or chain of transactions not involving any public offering) will typically bear a legend explaining their restricted status. The legend will disclose to prospective purchasers and other transferees that the securities are restricted, were acquired in a transaction not registered under the Securities Act, and cannot be resold absent registration under the Securities Act or an exemption from registration, and, in the latter case, if the proposed seller is an affiliate of the issuer, delivery of an opinion letter of counsel to the same effect. Without removing the legend, the seller will not be able to resell the securities in public markets regardless of whether all conditions of Rule 144 are met. The removal of the restricted legend must be done by the transfer agent for the securities. At the request of the proposed seller, the issuer will request that the transfer agent remove the restrictive legend for purposes of sale of the shares. In turn, the transfer agent will only remove the legend if it receives an opinion of the issuer's counsel that all applicable conditions of Rule 144 are met and that the legend can be removed. Issuer's counsel will only issue the required opinion if it has received from the proposed seller a certificate containing representations demonstrating the seller's compliance with Rule 144, including (1) the affiliate status of the seller, (2) the manner in which the seller acquired the securities, (3) when the seller acquired the securities, and (4) any other securities of the issuer sold by the seller in the past three months. Such representations are usually set forth in a letter as provided in this template. Issuer's counsel may also request a copy of the certificate representing the restricted securities and a certificate from the broker setting forth the manner of sale, as provided in Broker's Representation Letter (Rule 144 Resale) For forms of documents used in a Rule 144 sale, see Broker's Representation Letter (Rule 144 Resale), Form 144 Notice of Proposed Sale of Securities Pursuant to Rule 144 under the Securities Act of 1933, and Rule 144 Resale Opinion Letter. For more information on Rule 144, see Domestic Resales of Unregistered Securities: Rule 144, Section 4(a)(1½), and Section 4(a)(7).