restricted security

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Restricted Security

A stock or right that one acquires through some means other than the open market. One may receive a restricted security through a merger or acquisition, private placement prior to an IPO, or sometimes through a stock option. A restricted security is not registered with the SEC and thus may not be sold publicly until registration has been made. It is less commonly called a letter security.

restricted security

A security that has not been registered with the SEC and therefore may not be sold publicly. These securities frequently enter portfolios of institutional investors through private placements and are sometimes registered at a later date. Also called letter bond, letter security, letter stock, unregistered security.

Restricted security.

Restricted securities are stocks or warrants that you acquire privately, through stock options or a corporate merger, rather than by buying them in the open market.

For example, you may receive restricted stock if you put money into a startup company.

If the company has not yet registered with the Securities and Exchange Commission (SEC) for an initial public offering (IPO), its securities cannot be transferred or resold until the issuing company meets the SEC registration requirements for publicly traded securities.

If you exercise stock options and buy stock at a reduced price, you may be required to hold those stocks for a period of time before liquidating them.

References in periodicals archive ?
The CC Restricted Shares and plc RSUs will be released from
Under Smith's old working agreement, 53,075 restricted shares of Class A common stock were scheduled to vest on various dates through 2012.
This number includes 40 million restricted shares held by The Company's CEO and 40 million restricted shares held by The Company's CFO.
83 to an employee's conversion or exchange of "fully vested" or "unrestricted" shares for restricted shares has been unclear.
As a result, eight standard options may be traded for, say, two restricted shares or, perhaps better, one restricted share plus eight premium options.
The award of the restricted shares was approved by the independent members of the Company's Board of Directors without stockholder approval, in accordance with and subject to the exception for an "inducement grant" as such term is defined in Section 711(a) of the NYSE Amex Company Guide.
listing and trading of the tradable restricted shares this time is 30
As previously reported, PACT has issued 2,330,000 restricted shares of PACT in connection with its recent acquisition of Octavian.
The restricted shares will vest in equal installments on Jan.
The ruling involved a company that transferred restricted shares of common stock to an employee.

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