§ 359-F — Exemptions from certain provisions of section three hundred fifty-nine-e

New York § 359-F

• Jurisdiction: New York
• Law GBS: General Business
• Art. 23-A: Fraudulent Practices In Respect to Stocks, Bonds and Other Securities

Text

§ 359-f. Exemptions from certain provisions of section three hundred\nfifty-nine-e. 1. The provisions of subdivision eight of section three\nhundred and fifty-nine-e shall not apply to any transactions relating to\nthe sale or offering for sale of any of the following described\nsecurities by a dealer therein:\n (a) Any security issued, or guaranteed by the United States or any\nterritory or insular possession thereof, or by the District of Columbia,\nor by any state or political subdivision or agency thereof.\n (b) Any security issued or guaranteed by the Dominion of Canada or by\nany foreign government with which the United States is at the time of\nthe sale or offer for sale thereof maintaining diplomatic relations, or\nby any province or political subdivision thereof.\n (c) Any security issued by a national bank or by any federal land bank\nor joint-stock land bank or national farm loan association under the\nprovisions of the federal farm loan act of July seventeenth, nineteen\nhundred and sixteen, or by any corporation created or acting as an\ninstrumentality of the government of the United States pursuant to\nauthority granted by the congress of the United States.\n (d) Any securities issued or guaranteed by a public service or utility\ncorporation, including a railroad corporation, provided such corporation\nis subject to regulation or supervision either as to its rates and\ncharges or as to the issue of its own securities by a public commission,\nboard or officer of the government of the United States, or of any\nterritory, or insular possession thereof, or of any state or\nmunicipality or other political subdivision thereof, or of the Dominion\nof Canada, or any province thereof; also equipment and trust\ncertificates or equipment notes or bonds based on chattel mortgages,\nleases, or agreements for conditional sale of cars, motive power, or\nother rolling stock mortgaged, leased or sold to or furnished for the\nuse of or upon such a railroad or other public-service utility\ncorporation, or equipment trust certificates, or equipment notes or\nbonds where the ownership or title of such equipment is pledged or\nretained in accordance with the provisions of the laws of the United\nStates, or of any state, territory or insular possession thereof, or of\nthe District of Columbia, or of the Dominion of Canada, or of any\nprovince thereof, to secure the payment of such equipment trust\ncertificates, bonds or notes.\n (e) Any security issued by a corporation organized exclusively for\neducational, benevolent, fraternal, or reformatory purposes, and not for\npecuniary profit.\n (f) Any capital stock issued by a state bank, trust company or saving\ninstitution incorporated under the laws of and subject to the\nexamination, supervision and control of any state or of the United\nStates or of any insular possession thereof.\n (g) Any security which under the laws of this state is a legal\ninvestment for savings banks or trust funds, and any securities which\nare underwritten or sold by any corporation under the supervision of the\nsuperintendent of financial services of the state of New York.\n (h) Any security, other than common stock, outstanding for a period of\nnot less than five years, upon which no default exists in the payment of\nprincipal or interest and upon which no such default has occurred for a\ncontinuous immediately preceding period of five years, or in the case of\npreferred stock upon which dividends specified in the certificates of\nsuch stock have been paid for a continuous immediately preceding period\nof five years.\n (i) Negotiable promissory notes, drafts, and commercial paper provided\nthat such issue of notes, drafts and commercial paper mature in not more\nthan twelve months from date of issue and shall be issued within three\nmonths after the date of sale.\n (j) Any bond and mortgage sold or offered for sale in an undivided\nwhole.\n (k) Securities which on January first, nineteen hundred and\ntwenty-five, have been fully listed upon any exchange, located in the\nstate of New York, which on said date was organized and in operation,\nany securities senior thereto and additional amounts of all such\nsecurities which thereafter become so listed so long as the same shall\nremain so listed. Securities which shall become fully listed upon any\nsuch exchange subsequent to said January first, nineteen hundred and\ntwenty-five, shall not be exempted as herein provided unless and until\nsuch exchange shall cause to be duly published pursuant hereto in the\nstate paper as defined herein, a notice which shall contain the name of\nthe corporation, association, common law trust or similar organization\nissuing the securities so listed, the business or post office address\nthereof, the state or country where incorporated or organized, the date\nof such listing and a brief description of the securities so listed.\nAfter such publication of said notice as aforesaid, securities so listed\nsubsequent to January first, nineteen hundred and twenty-five, any\nsecurities senior thereto and additional amounts of all such securities\nwhich thereafter become so listed, shall be exempted hereunder so long\nas the same shall remain so listed.\n (l) Securities sold or offered for sale at any judicial, executor's,\nadministrator's, guardian's, or conservator's sale, or any sale by a\nreceiver or trustee in insolvency or bankruptcy, or at a public sale by\nauction held at an advertised time and place.\n (m) Sales by or for the account of a pledgee or mortgagee selling or\noffering for sale or delivery, in the ordinary course of business, to\nliquidate a bona fide debt, a security pledged in good faith as security\nfor such debt.\n (n) Negotiable documents of title, foreign currency orders and calls\nor options therefor.\n 2. The attorney general may upon application, in writing, grant\nexemptions from the provisions of section three hundred fifty-nine-e,\nsubdivisions two, three, four, five and six to any person, partnership,\ncorporation, company, trust or association which is a dealer as defined\nin section three hundred and fifty-nine-e, solely by reason of the fact\nthat it is offering to sell or selling or offering to purchase or\npurchasing to or from the public, within or from this state any one or\nmore of the securities which are specified in any one or more of the\nfollowing paragraphs of this subdivision two of section three hundred\nfifty-nine-f:\n (a) Securities of a corporation which has been in existence for a\nperiod of not less than ten years or which is a consolidation, merger,\nor successor of one or more corporations which has been in existence for\na period of not less than ten years, and which have not defaulted in the\npayment of principal or interest on any of its obligations for a\ncontinuous immediately preceding period of ten years, and in the case of\npreferred stock, upon which dividends specified in the certificates of\nsuch stock have been paid for a continuous immediately preceding period\nof six years, and in the case of common stock, upon which dividends have\nbeen paid annually for a continuous immediately preceding period of six\nyears at the rate of not less than three per cent of the book value of\nsuch common stock as shown by its balance sheet at the date of the close\nof the fiscal year in which such dividends were paid, as certified by an\nindependent certified public accountant.\n (b) Securities which are fully listed on any securities exchange\nlocated in this state so long as the same shall remain so listed, and\nany securities senior thereto and additional amounts of any such\nsecurities which are so listed or which it is planned, at the time of\nthe offering thereof, to list.\n (c) All securities which are mentioned in section three hundred\nfifty-nine-f, subdivision one, with the exception of such securities as\nare specified in subdivisions h and k thereof.\n (d) Securities which are to be sold in a limited offering to not more\nthan forty persons; but the attorney-general may grant an exemption for\nofferings made to more than forty persons when he deems such an\nexemption within the purposes of this subdivision.\n (e) Securities issued in connection with an employees' stock purchase,\nsavings, pension, profit-sharing, or similar benefit plan.\n