Transfer restrictions are terms that prevent the transfer of securities. They can be required by any of the following:
- Statute (such as the hold period restrictions required for some securities acquired pursuant to a private placement exemption).
- Constating documents (such as restrictions set out in the articles of incorporation of the corporation or a unanimous shareholder agreement (USA)).
- Contractual (such as the terms of a shareholder agreement other than a USA or a vesting agreement).