Companies often use a registration statement on Form S-8 to register shares for resale by Directors, Officers and employees who are granted stock options or shares as part of their compensation. This is a small document that is relatively easy and inexpensive to use.
Shares registered using Form S-8 may be freely resold without restrictions by employees. Directors and Officers, however, whose shares are registered using Form S-8 are still subject to the volume restrictions contained in Rule 144. Rule 144 prohibits sales by Directors or Officers which, in any three month period, exceed the greater of (i) 1% of the total shares of the company outstanding or (ii) the average weekly trading volume for the preceding 4 weeks.
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