Frequently Asked Questions

In general terms a signature guarantee is the process whereby the guarantor warrants to the transfer agent that:

a) the signature of the shareholder is genuine,

b) the signer was an appropriate person to endorse the certificate, and

c) the signer has the legal capacity to sign.

The Medallion Signature Guarantee is the term used to describe the programs that are in place in the United States and in Canada. Companies can apply for, pay an insurance premium and if approved, receive a special stamp to enable them to provide signature guarantees within the limits of the insurance they have paid for. The limits are set to the market value of any one certificate the medallion stamp appears on. In Canada, in addition to the Medallion programs, banks may also provide signature guarantees.

A signature guarantee is required to transfer a security as it provides the transfer agent and the company with some proof that the registered owner of the security wishes to transfer the security and to relinquish ownership.

In Canada, there are two acceptable ways to guarantee a security:

• A signature guarantee from a Canadian Chartered Bank or a US Chartered Bank. This form of guarantee is represented by a stamp from the financial institution and is signed by an officer who guarantees that the signature is genuine. The officer must also provide his/her bank identification number.
  
  
• The second acceptable form of guarantee is to have a financial institution (broker, dealer, etc.) place a Medallion Signature Guarantee supported by a recognized Security Transfer Association Medallion Program indicating that the signature is genuine.

If you reside offshore, you can have your signature guaranteed by a representative at a local branch of a Schedule I Canadian chartered bank or United States and he/she can make arrangements to have the security over guaranteed in Canada or the United States by the same bank.

There are many variables that may affect specific transfers, but, in general, if the certificate is registered in your name, here are the steps to follow (if you are delivering your shares to a broker because you have sold them or otherwise disposed of them, the requirements will be similar but you should check to see if they have any individual requirements):

• Print on the transfer panel (on the reverse side of each certificate) exactly how you wish the new certificate to be registered
  
  
• Sign the transfer panel in the exact way the registration appears on the face of the certificate
  
  or
  
  
• Complete a Stock Power of Attorney form (in a similar manner as described above as the form is similar to what appears on the back of a share certificate) and attach it to the certificates
  
  
• You must sign the transfer panel on the back of the certificate or the stock power of attorney in the appropriate place and have your signature guaranteed by a Canadian chartered bank, US Bank, or a member/participant in a recognized medallion signature guarantee program

There is an additional requirement for shares registered in the name of a corporation. A resolution that is dated, or has been signed, within the last 6 months that appoints one or more persons to sign on behalf of the corporation must be delivered with the certificate (or stock power of attorney) signed by the person or persons with the appropriate medallion signature guarantee. Note the resolution must be certified by someone other than the person designated in the resolution unless there is only one signing officer for the corporation. If there is only one signing officer for the corporation, the resolution must state that the person signing the resolution is the "sole signing officer".

The requirements to transfer shares registered in the name of the deceased vary according to the residence of the deceased. Some of the documents that are typically required to transfer these certificates are as follows;

• Letters of administration /Letters of Probate/Notarial copy of the Last Will and Testament (originals or court certified copy)
  
  
• Declaration of Transmission
  
  
• Death Certificate (original or certified copy)
  
  
• Stock Power of Attorney
  
  
• Share certificate

To obtain further information on the requirements to transfer certificates for a particular estate, please contact our office. Please provide us with the name of the deceased, former residence, name and address of the executor and the details of the shareholdings of the deceased that are to be transferred.

There are two situations depending on whether the trustee is named in the registration, or the certificate is in the name of the trust itself.

A certificate should never be registered in the name of an entity if there is no agreement or legal documents creating the entity and providing for the administration of the assets held by the entity.

If the trustee appears on the certificate then all that is required are the normal transfer requirements for an individual, if the trustee is a person. The trustee would endorse the certificate as the trustee and have his or her signature guaranteed. If the trustee is a corporate entity, then we would require documents identifying those who could sign on behalf of the corporation; the individual(s) named would have to endorse the certificate and have his/her (their) name(s) guaranteed.

If the certificate is in the name of the trust, then the agreement or document (the original or certified copy) creating the trust must be presented with the transfer request, and the appropriate parties named in the trust document must endorse the certificate and have their signatures guaranteed.

A Corporate Signing Resolution is required to transfer a security that is registered in the name of a company. The Corporate Signing Resolution identifies the individual(s) who has been given the authority to sign on behalf of the corporation. The resolution must be dated within 6 months of the date the certificate is presented for transfer and specimen signature(s) must also be provided. The individual endorsing the certificate must be different from the person certifying the corporate resolution unless there is only one signing officer. A signature or a Medallion STAMP guarantee is also required when a resolution is presented with the certificate.

If you are a registered owner, to change the name that appears on the certificate you must:

• Complete the transfer panel (on the reverse side of the certificate)
  
  
• Place your signature on the signature line, exactly as it appears on the face of the certificate.
  
  
• Have your signature guaranteed by a Schedule I Canadian Chartered Bank, US Bank, or financial institution that is a member of a recognized Medallion Signature Guarantee (STAMP) Program.

Please mail your request to us with the following information:

• Have your signature guaranteed by a Schedule I Canadian Chartered Bank, US Bank, or financial institution that is a member of a recognized Medallion Signature Guarantee (STAMP) Program.
  
  
• Please provide proof of residence such as a utility bill.  Such proof needs to be current within the past 2 months.

Please note that we cannot accept fax or email requests.

After a one-year holding period, Rule 144 permits the public resale of restricted securities if a number of conditions are met, including how long the securities are held, the way in which they are sold, and the amount that can be sold.

After a two-year holding period, many of the conditions of 144 are relieved by Rule 144K and the restrictive legend may be permanently removed.  If the restrictive legend is under Regulation S then the said legend may be permanently removed after a one-year holding period.

GSET physically performs this service but will only do so after obtaining permission of the corporation, receiving the opinion letter of counsel, and a 144 letter.

Payment must be sent to GSET with the opinion letter of counsel, the 144 letter, and stock certificate with the shareholders current address and phone number.

Rule 144 allows holders of restricted or control securities to sell those securities in the open market without filing a registration statement under the Securities Act of 1933, provided certain conditions are met by the seller, the broker and the company. Rule 144 has a 1-year holding period; Rule 144(k) has a two-year holding period for non-control shareholders.

Restricted/Control Securities

In general, restricted securities are acquired from a company or a control person (also referred to as an affiliate) of the company in a non-public transaction (private placement). Such securities are unregistered, can only be resold under certain conditions and usually bear a legend to that effect. Securities acquired by a control person in any manner, including an open market purchase, are control securities. Control securities can also be restricted securities depending on how they were acquired. Restricted securities can also be control securities if the person or entity is using the Issuing Corporations' address for mailings. Restricted and control securities obtained by third parties as gifts or donations, or pledged for a loan, may be sold under appropriate circumstances through Rule 144.

A Control Person

A control person is anyone who directly or indirectly controls the management and affairs of a company. Senior officers, directors and certain large shareholders are usually considered control persons. Whether a control relationship exists is a factual determination usually made by the company or its legal counsel. As a seller under Rule 144, a control person is also defined to include the following: relatives living in the same household as the control person; trusts, estates, corporations or other entities in which the control person has a 10% ownership interest; and trusts and estates in which the control person serves as a trustee, executor or a similar capacity.

Current public information

The company whose securities are being sold under the rule must have available "adequate current public information." Generally, this requires meeting the reporting requirements of the SEC for at least 90 days before the proposed sale and filing all required reports during the 12 months preceding the sale (or such shorter period that the company has been subject to filing requirements).

Holding period

Restricted securities must be fully paid for and beneficially owned for a period of at least one year prior to sale. There is no required holding period for control securities that are not also restricted securities. Therefore, a control person who acquires shares through exercise of stock options covered by a registration statement, or buys stock in the open market, has no Rule 144 holding period (although he or she may be subject to short swing liability if the shares are sold within six months of acquisition or date options are granted).

Amount to be sold

The amount of securities that may be sold under Rule 144 during any three-month period is the greater of:

• 1 % of the class of securities outstanding or
  
  
• The average weekly reported volume of trading in the securities during the four calendar weeks prior to the filing with the SEC of Form 144, Notice of Proposed Sale

In calculating the maximum number of shares that may be sold, the seller must deduct the number of shares he or she has sold, as well as the number of shares sold within the prior three months by the following:

• Relatives who share the same household,
  
  
• Any trust or estate in which he or she owns or such relatives collectively own 10% or more of beneficial interest or serves as trustee, executor or similar capacity,
  
  
• Any corporation or entity in which he or she owns or such relatives collectively own 10% or more of the beneficial interests,
  
  
• A party to whom he or she donated or pledged any such shares as a gift or in pledge for a loan, and/or
  
  
• A party selling in concert with him or her.

**Sellers acting in concert are treated as one in determining the number of shares that can be sold.

Filing of notice requirements

A completed original and two copies of SEC Form 144 (Notice of Proposed Sale) must be mailed to the SEC at or prior to the time of placing the sell order. If the security is exchange-traded, a copy must also be filed with the principal exchange.**

**A seller does not have to file a notice if within any 3-month period, he or she sells no more than 500 shares and the aggregate sales price does not exceed $10,000, however all other requirements of Rule 144 apply.

Manner of sale

Rule 144 sales must be made in "brokers' transactions," that is, in agency transactions, although they may be affected in principal transactions if the broker is a market maker or a block position (only if the sale is of block size) in the issue. The broker can inquire only of customers and other dealers who have recently expressed buy interest in the issue. (However, if the dealer purchases the stock as principal, the dealer may solicit buy orders.)

Intent to sell

The seller of restricted or control securities must have a "bona fide intent to sell" the securities within a reasonable time after the filing of the notice with the SEC. SEC rules require the shares be sold within 90 days of filing form 144.

Exemptions from certain requirements 144(k)

Restricted securities may be sold under Rule 144 exempt from volume limitations, filing and manner of sale requirements if the securities have been fully paid for and beneficially owned for at least two years and the seller has not been a control person for at least three months. Estates or beneficiaries of estates that are not control persons are exempt from volume limitations, the holding period and the manner of sale requirements. A legal opinion letter approved by the Company may be required for sale of these securities.