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Form 144

The notice filed before an affiliate or holder of restricted stock sells into the market, disclosing the intended size and the broker, ahead of the sale itself.

Rule 144 is the exemption that lets restricted-stock be resold: it requires a holding period, current public information, volume limits for affiliates, and this notice above a small threshold. The volume cap is the greater of 1% of shares outstanding or the average weekly volume over the prior four weeks, per rolling three-month period.

Because it is filed before the sale, a 144 is a forward-looking signal in a way a form-4 is not, though the sale need not actually happen.

Example: 240M shares outstanding gives a 1% cap of 2.4M shares per three months. Average weekly volume is 3.1M, so the affiliate may sell up to 3.1M shares and files a 144 naming that amount.

Related: restricted-stock, form-4, lock-up-period, private-placement, insider-trading

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