Legal Opinions on Secondary Sales of Stock

Friday, January 1st, 1988 at 12:00 am by Scott FitzGibbon & Donald W. Glazer
Scott FitzGibbon & Donald W. Glazer, Legal Opinions on Secondary Sales of Stock, 1988 Colum. Bus. L. Rev. 149

Many sales of stock from one stockholder to another (‘secondary sales’), including large block sales in the public market, are conducted without the benefit of a legal opinion on the rights the buyer is acquiring in the shares. However, where the secondary sale is part of a registered public offering, the underwriters ordinarily require such an opinion as a matter of course. A ‘secondary sale opinion’ is also sometimes required when a company is acquired through the sale of all of its outstanding stock. Such opinions serve to assure the buyer that the seller owns the shares and that the buyer is acquiring all of the seller’s rights in the shares free of any restrictions on transfer, adverse claims and the like.

Author Information

Scott FitzGibbon, Professor of Law, Boston College Law School. B.A. 1967, Antioch College; J.D. 1970, Harvard Law School; B.C.L. 1972, Oxford University. Donald W. Glazer, Partner, Ropes & Gray, Boston; Lecturer in Law, Harvard Law School. B.A. 1966, Dartmouth College; J.D. 1969, Harvard Law School; LL.M 1970, University of Pennsylvania Law School.