RULES AND REGULATIONS
Title 64--SECURITIES
PART I. SECURITIES COMMISSION
[64 PA. CODE CHS. 102, 202--204, 207,
209, 302, 606 AND 609]
Registration of Securities, Broker-Dealers, Agents, Investment Advisers and Administration
[27 Pa.B. 5255] Statutory Authority
The Securities Commission (Commission), under the authority contained in sections 102(k), 202(h) and (i), 203(r), 204(a), 207(h), (i) and (k), 209(a), 606(a) and 609(a) of the Pennsylvania Securities Act of 1972 (act) (70 P. S. §§ 1-102(k), 2-202(h) and (i), 2-203(r), 2-204(a), 2-207(h), (i) and (k), 2-209(a), 6-606(a) and 6-609(a)), has amended regulations concerning the subject matter of the act to read as set forth in Annex A.
Public Comments
No public comments were filed with the Commission concerning the proposed rulemaking published at 27 Pa.B. 2739 (May 31, 1997) during the 30-day public comment period.
Comments of the Independent Regulatory Review Commission (IRRC)
By letter dated July 30, 1997, IRRC provided two comments, both of which related to typographical errors appearing in §§ 207.091 and 606.011 (relating to subscription contracts; and financial reports to security holders). These corrections have been included in the final-form rulemaking.
Changes from Proposed Rulemaking adopted by Commission
In addition to adopting changes to the proposed rulemaking published at 27 Pa.B. 2739 which were suggested by IRRC, the Commission adopted two nonsubstantive changes to §§ 203.189 and 209.010 (relating to isolated exemption; and required records; report on sales of securities and use of proceeds). With respect to § 203.189(b), the Commission reordered the criteria to be met for the waivers granted by that subsection in order to provide greater clarity. With respect to § 209.010, the Commission deleted the reference to Form AM in item 5 of the general instructions to Form 209 since the Commission, in the proposed rulemaking, indicated its intention to amend § 609.011 to delete Form AM in its entirety.
Summary and Purpose of Amendments
§ 102.111
Offers and sales of securities to institutional investors are exempt from the securities registration provisions of the act. Section 102.111 (relating to institutional investor) is amended to expand the definition of institutional investor in section 102(k) of the act to include a ''qualified institutional buyer'' as that term is defined in Rule 144A of the United States Securities and Exchange Commission (17 CFR 230.144A (relating to private resales of securities to institution)). The Commission amends § 102.111 as published at 27 Pa.B. 2641.§ 202.080
The amendment to this regulation eliminates the requirement that a registered broker-dealer proposing to offer and sell its securities to its officers, partners or employes who are residents of this Commonwealth in reliance upon section 202(h) of the act make a notice filing on Commission Form 202-H. Since this regulation originally was promulgated, the Commission has adopted several self-executing exemptions which may be available for the same transaction. The Commission deletes § 202.080 (relating to securities issued by broker-dealers) as published at 27 Pa.B. 2641.§ 202.094
Currently, many large, multinational corporations domiciled outside of the United States cannot take advantage of exemptions from registration under the act because their securities are not listed on a United States stock exchange or they are not reporting companies to the Securities and Exchange Commission (SEC). Section 202.094 designates securities issued by large, multinational corporations that do not have securities listed on a United States securities exchange as exempt from the registration provisions of the act. This will provide parity with securities of large United States corporations whose securities are exempt under section 202(f) of the act. The Commission adopts § 202.094 (relating to world class issuer exemption) as published at 27 Pa.B. 2642.§ 203.189
The amendment to this regulation increases the number of sales permitted under this exemption and would waive the general solicitation prohibition and Pennsylvania domicile requirement for certain sales. The amended regulation provides an exemption from the securities registration requirements where there will be only isolated offers and sales made in this Commonwealth of a de minimis nature. The Commission amends § 203.189 (relating to isolated transaction exemption) as published at 27 Pa.B. 2642, except that it further adopts nonsubstantive amendments to § 203.189(b) to provide additional clarity.§ 203.190
Section 203.190 (relating to certain Internet offers exempt) codifies the Commission's existing order granting an exemption for offers of securities made on the Internet that are not intended to be sold to Commonwealth residents. The Commission adopts § 203.190 as published at 27 Pa.B. 2642.§ 204.012
Section 204.012 (relating to waivers for offerings where sales are made only to accredited investors) waives the offer and sale numerical limitations in sections 203(d) and (e) of the act and the general solicitation prohibitions for offerings of securities where sales only will be made to accredited investors. The Commission adopts § 204.012 as published at 27 Pa.B. 2643.§ 207.081
The amendment to this regulation eliminates the requirement that debt securities, as a condition of registration by qualification under section 206 of the act, be issued under a trust indenture complying with Trust Indenture Act of 1939 (15 U.S.C.A. §§ 77aaa--77bbbb) or similar State requirements. The Commission deletes § 207.081 (relating to trust indenture requirements) as published at 27 Pa.B. 2644.§ 207.091
The amendment to this regulation reduces the types of offerings which must file a copy of the subscription contract with the Commission. This amendment also eliminates the requirement that issuers of securities sold under the Federal exemption for intrastate offerings and registered under section 206 of the act use a subscription contract prepared in a specified format. Additionally, the amendment deletes recordkeeping requirements for subscription contracts that duplicate requirements in § 209.010(a)(6). The Commission amends § 207.091 (relating to subscription contracts) as published at 27 Pa.B. 2644.§ 207.110
The amendment to this regulation eliminates the requirement that issuers selling securities registered under section 206 of the act but not registered under the Federal Securities Act of 1933 (15 U.S.C.A. §§ 77a--77aa), file reports with the Commission on a quarterly basis. The Commission deletes § 207.110 (relating to quarterly reports of the progress of a registered offering) as published at 27 Pa.B. 2645.§ 209.010
First, § 209.010 (relating to required records; report on sales of securities) is amended to repeal the requirement to file a report of sales and use of proceeds for sales of securities made in this Commonwealth under section 203(d) and (p) of the act. Second, § 209.010 is amended to conform with the National Securities Markets Improvement Act of 1996 (NSMIA) (Pub.L. No. 104-290) 110 Stat 3416 by deleting all references to registration or exemption of securities offerings by investment companies under section 205, 206 or 203(i) of the act. (Note: Section 209 of the act was amended by Act 4 of 1993 to reflect that the section 203(i) exemption was no longer available for investment companies but this registration requirement now has been preempted by NSMIA). The Commission amends § 209.010 to conform with the requirements of NSMIA and eliminate use of terms which may cause confusion within the regulated community.
On October 11, 1996, section 102 of NSMIA became effective which amended section 18 of the Securities Act of 1933 (15 U.S.C.A. § 77r-1) to prohibit the application of any State law requiring the registration or qualification of securities of investment companies registered under the Federal Investment Company Act of 1940. NSMIA, in section 18((c)(1) of the 1933 Act, however, did preserve the ability of the states to require notice filings (as opposed to registration or exemption filings), fee payments and sales reports. Both section 209 of the act and § 209.010, however, describe the requirement to file sales reports by investment companies using the terms ''registration or exemption'' under section 205, 206 or 203(i) of the act. This amendment will eliminate all references to registration or exemption provisions of the act, adopt a new uniform sales report form to be used by all states which also eliminates references to registration or exemption and establish a uniform filing period for classes of investment companies consistent with Federal law. The Commission amends § 209.010 as published at 27 Pa.B. 2745 with a further amendment to Item 5 of the General Instructions to Form 209 to delete the reference to Form AM which the Commission, by adopting amendments to § 609.011 (relating to amendments to filings with Commission), is deleting in its entirety.§ 302.065
This new regulation will exempt Canadian broker-dealers and agents that are licensed and in good standing in Canada from the broker-dealer and agent registration provisions of the act if the Canadian broker-dealer or agent effects transactions only with persons from Canada who are preexisting clients and who temporarily are present in this Commonwealth when the transactions occur. The Commission adopts § 302.065 (relating to Canadian broker-dealer exempt) as published at 27 Pa. B. 2648.§ 606.011
Section 606.011 (relating to financial reports to security holders) would be amended to exclude from specified financial statement delivery requirements issuers of securities that are not reporting companies under the Federal securities laws and are exempt from registration under the act where the transaction was made in connection with a merger, a distribution to existing shareholders or the Commission granted a discretionary exemption. Issuers of securities filing under sections 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.A. §§ 78m and 780(d)), if they have made a filing within the past 120 days, also would be excluded from the financial statement delivery requirement. The Commission amends § 606.011 as published at 27 Pa.B. 2649, except that this section was amended to correct a typographical error in a legal citation.§ 609.011
The amendment to this regulation deletes Commission Form AM and the requirement that amendments to Commission filings be made on Commission Form AM and adopts a general procedural requirement to amend notices, registration statements and other matters previously filed with the Commission. The Commission amends § 609.011 (relating to amendments to filings with Commission) as published at 27 Pa.B. 2749.Persons Affected by these Amendments
With respect to the amendment to § 102.111, issuers of securities to qualified institutional buyers will be affected by the proposed action.
With respect to the deletion of § 202.080, broker-dealers who rely upon the exemption in section 202(h) of the act to offer and sell securities to their officers, partners and employes who are residents of this Commonwealth no longer have to file Commission Form 202-H.
With respect to the adoption of § 202.094, the persons affected are large multinational foreign corporations offering and selling securities to investors in the United States.
With respect to the amendment to § 203.189, the persons affected are those issuers that want to offer and sell securities to only a few persons in this Commonwealth.
With respect to adoption of § 203.190, persons affected are those persons using the Internet to make offers of securities.
With respect to adoption of § 204.012, persons affected are issuers of securities in offerings when sales will be made only to accredited investors.
With respect to the deletion of § 207.081, persons affected are issuers of debt securities subject to registration under section 206 of the act.
With respect to amendments to § 207.091, persons affected are issuers of offerings made in reliance upon the Federal exemption from registration for intrastate offerings and offerings of interests in public direct participation programs.
With respect to deletion of § 207.110, persons affected are issuers selling securities registered under section 206 of the act but not registered under the Securities Act of 1933.
With respect to amendments to § 209.010, persons affected are issuers of securities sold in reliance upon the exemptions provided by sections 203(d) and (p) of the act and investment companies selling securities in this Commonwealth.
With respect to the adoption of § 302.065, persons affected are licensed Canadian brokers and agents effecting transaction in this Commonwealth with a preexisting client who temporarily is present in this Commonwealth at the time of the transactions.
With respect to amendments to § 606.011, persons affected are issuers of securities exempt from registration under the act because the transaction involved a merger, distribution to existing shareholders or Commission granted discretionary exemption, and issuers of securities filing under sections 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.A. §§ 78a--78mm), if a filing has been made within the past 120 days.
With respect to amendments to § 609.011, persons affected are those seeking to amend documents previously filed with the Commission.
Fiscal Impact
The regulatory actions will decrease regulatory costs to the public. The Commonwealth General Fund will sustain a loss of approximately $20,000 in fee revenue from the amendment to § 203.189 as securities offered and sold in certain isolated transactions will no longer be required to make a notice filing under section 203(d) of the act and pay the applicable fee. Likewise, the General Fund may sustain a minimal loss of fee revenue from the adoption of § 302.065 as certain Canadian brokers and their agents no longer would be subject to registration requirements.
The remaining amendments, adoptions and deletions do not have a fiscal impact on the Commonwealth.
Paperwork
Sections 202.080, 207.081, 207.110 and 209.010 will eliminate paperwork as the regulatory actions delete rules requiring the filing of specified forms and documents. With respect to §§ 207.091 and 609.011, paperwork would be reduced as information will no longer be required to be filed with the Commission in a specified format.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), the Commission submitted a copy of the notice of proposed rulemaking published at 27 Pa.B. 2639 (May 31, 1997) on April 24, 1997 to IRRC and the Chairpersons of the House Committee on Commerce and Economic Development and the Senate Committee on Banking and Insurance for comment and review. In compliance with section 5(b.1) of the Regulatory Review Act, the Commission also provided IRRC and the Committees with copies of all comments received as well as other documentation.
In preparing its final-form rulemaking, the Commission has considered all comments received from IRRC, the Committees and the public. This final-form rulemaking was deemed approved by the House Committee on Commerce and Economic Development and by the Senate Committee on Banking and Insurance on August 27, 1997. IRRC met on September 4, 1997, and approved the final-form rulemaking on that date.
Availability in Alternative Formats
This final-form rulemaking may be made available in alternative formats upon request. TDD users should use the AT&T Relay Center (800) 854-5984. To make arrangements for alternative formats, contact Joseph Shepherd, ADA Coordinator at (717) 787-6828.
Contact Person
The contact person is G. Philip Rutledge, Deputy Chief Counsel, Pennsylvania Securities Commission, Eastgate Building, 1010 N. Seventh Street, 2nd Floor, Harrisburg, PA 17102-1410, (717) 783-5130.
Order
The Commission, acting under the authorizing statute, orders that:
(a) The regulations of the Commission, 64 Pa. Code Chapters 102, 202, 203, 207, 209, 302, 606 and 609 are amended by amending §§ 102.111, 203.190 and 609.011, by deleting §§ 202.080, 207.081 and 207.110; and by adding §§ 202.094, 204.012 and 302.065 to read as set forth at 27 Pa.B. 2739; and by amending §§ 203.189, 207.091, 209.010 and 606.011 to read as set forth in Annex A with ellipses referring to the existing text of the regulations.
(b) The Assistant Secretary of the Commission shall submit this order and Annex A to the Office of Attorney General for approval as to form and legality as required by law.
(c) The Assistant Secretary of the Commission shall certify this order and Annex A and deposit them with the Legislative Reference Bureau as required by law.
(d) This order shall take effect upon publication in the Pennsylvania Bulletin.
M. JOANNA CUMMINGS,
SecretaryFiscal Note: Fiscal Note 50-110 remains valid for the final adoption of the subject regulations.
Annex A
TITLE 64. SECURITIES
PART I. PENNSYLVANIA SECURITIES COMMISSION
Subpart A. REGISTRATION OF SECURITIES
CHAPTER 203. EXEMPT TRANSACTIONS § 203.189. Isolated transaction exemption.
(a) General. Under section 203(r) of the act (70 P. S. § 1-203(r)), the Commission finds it neither necessary nor appropriate for the protection of investors to require registration under section 201 of the act (70 P. S. § 1-201) for the offer and sale of securities by an issuer if:
(1) Sales made under this section do not result in the issuer having made sales of its securities to more than two persons in this Commonwealth during a period of 12 consecutive months. Only sales described in subsection (c) will be counted as sales for purposes of the numerical limitations contained in this paragraph.
(2) Offers made under this section do not result in the issuer having made offers to sell its securities to more than 90 persons in this Commonwealth during a period of 12 consecutive months. Only offers described in subsection (c) will be counted as offers for purposes of the numerical limitations contained in this paragraph.
(3) The issuer either is organized under the laws of the Commonwealth or has its principal place of business in this Commonwealth.
(4) Neither the issuer nor a promoter, officer or director of the issuer is subject to the disqualifications in § 204.010(b) (relating to increasing the number of purchasers and offerees).
(5) No public media advertisement is used or mass mailing is made in connection with offers and sales made under this section.
(6) Cash or securities are not given or paid, directly or indirectly, to a person as compensation in connection with a sale under this section unless the compensation is given or paid in connection with a sale made by a broker-dealer who either is registered under section 301 of the act (70 P. S. § 1-301) or exempt from registration under section 302(a) of the act (70 P. S. § 1-302(a)) and a person receiving compensation is either the broker-dealer or an agent of the broker-dealer who either is registered under section 301 of the act or exempt from registration under section 302(b) of the act.
(b) Waivers.
(1) Subsection (a)(3) and (5) does not apply if the following criteria are met:
(i) The securities to be sold in reliance on this section are registered with the United States Securities and Exchange Commission under section 5 of the Securities Act of 1933 (1933 Act) (15 U.S.C.A. § 77e) or exempt from registration under Regulation A adopted under section 3(b) of the 1933 Act (15 U.S.C.A. § 77c(b)).
(ii) The issuer has complied with section 203(h) of the act (70 P. S. § 1-203(h)).
(2) Subsection (a)(3) does not apply if the following criteria are met:
(i) The offers and sales of securities made in reliance on this section would qualify for an exemption from registration under section 5 of the 1933 Act under Rule 505 or Rule 506 of Regulation D (17 CFR 230.505 and 230.506 (relating to exemption for limited offers and sales of securities not exceeding $5 million; and exemption for limited offers and sales without regard to dollar amount of offering)) promulgated under sections 3(b) and 4(2) of the 1933 Act.
(ii) The offers made in this Commonwealth in reliance on this section are made only to accredited investors as that term is defined in § 204.010 (relating to increasing the number of purchasers and offerees).
(iii) The sales made in this Commonwealth in reliance on this section are made only to accredited investors as that term is defined in § 204.010.
(c) Inclusion of prior offers and sales. Offers and sales which occurred within the preceding 12 months from the date of an offer or sale to be made under this section that were made in reliance upon section 203(d) or (f) of the act, §§ 203.187 and 204.010(a)(1) and (2) (relating to small issuer exemption; and increasing number of purchasers and offerees), 17 CFR 230.506 or this section shall be counted against the numerical limitations in subsection (a)(1) and (2).
(d) Integration. Offers and sales made by the issuer under this section shall be counted as offers and sales under the applicable numerical limitations in § 204.010(a)(1) and (2) if offers and sales occur under § 204.010 within 12-consecutive months of an offer or sale made under this section.
(e) Counting of offerees and purchasers. Section 609.012 (relating to computing the number of offerees, purchasers and clients) applies to offers and sales of securities made under this section.
CHAPTER 207. GENERAL REGISTRATION PROVISIONS § 207.091. Subscription contracts.
(a) With respect to securities proposed to be sold under one of the following registration statements, a copy of a subscription or sale contract proposed to be used shall be filed with the Commission, as an exhibit, prior to its use in this Commonwealth:
(1) A registration statement filed under section 205 of the act (70 P. S. § 1-205) when the securities to be sold are exempt from registration under section 5 of the Securities Act of 1933 (15 U.S.C.A. § 77e) under Regulation A promulgated under section 3(b) of the Securities Act of 1933 (15 U.S.C.A. § 77c(b)).
(2) A registration statement filed under section 206 of the act (70 P. S. § 1-206) when the securities to be sold are exempt from registration pursuant to section 5 of the Securities Act of 1933 under section 3(a)(4) or (11), Regulation A promulgated under section 3(b) of the Securities Act of 1933, or Rule 504 of Regulation D promulgated under section 3(b) of the Securities Act of 1933.
(3) A registration statement filed under section 205 or 206 of the act where the securities to be sold are interests in a direct public participation program.
CHAPTER 209. BOOKS, RECORDS AND ACCOUNTS § 209.010. Required records; report on sales of securities.
* * * * * (b) Except as set forth in paragraph (3), filing requirements are as follows:
(1) Issuers which have an effective registration for the offer and sale of securities in this Commonwealth under section 206 of the act, except for open-end or closed-end investment companies, face amount certificate companies or unit investment trusts, as those persons are classified in the Investment Company Act of 1940 (15 U.S.C.A. §§ 80a-1--80a-64), shall file a report with the Commission by completing Parts I and II of the form in subsection (c) within 55 days after 1 year from the effective date of the registration statement filed under section 206 of the act.
(2) An issuer which is an open-end or closed-end investment company, face amount certificate company or unit investment trust, as those persons are classified in the Investment Company Act of 1940, shall file with the Commission an annual report on sales of securities in this Commonwealth on Form NF adopted by the North American Securities Administrators Association, Inc. (or a successor form thereto) within the following time periods:
(i) With respect to an open-end or closed-end investment company or face amount certificate company, the report required by this subsection shall be filed with the Commission within 120 days after its fiscal year end.
(ii) With respect to a unit investment trust, the report required by this subsection shall be filed with the Commission within 60 days after 1 year from the date the registration statement relating to the securities sold in this Commonwealth became effective with the United States Securities and Exchange Commission.
(3) The following issuers are not required to file the form in subsection (c) or Form NF (or successor form thereto):
(i) Issuers which are open-end or closed-end investment companies, face amount certificate companies or unit investment trusts, as those persons are classified in the Investment Company Act of 1940, that have paid themaximum fee specified in section 602(b.1)(iv) of the act (70 P. S. § 1-602(b.1)(iv)).
(ii) Issuers with an effective registration statement for the offer and sale of securities in this Commonwealth under section 206 of the act which also have an effective registration statement under section 5 of the Securities Act of 1933 (15 U.S.C.A. § 77e) and have paid the maximum fee specified in section 602(b.1)(iii) of the act.
(iii) Issuers with an effective registration statement for the offer and sale of securities in this Commonwealth under section 206 of the act which also have paid the maximum fee specified in section 602(b.1)(iii) of the act.
(c) The form for reports required in subsection (b), except for subsection (b)(2), shall be filed with the Commission on the following form, designated by the Commission as Form 209:
PENNSYLVANIA SECURITIES COMMISSION
FORM 209
REPORT ON SALES OF SECURITIES
General InstructionsWHO MUST FILE: Issuers which have sold securities in Pennsylvania pursuant to registration by qualification under Section 206, EXCEPT where the offering is registered under Section 5 of the Securities Act of 1933 AND the maximum fee has been paid (see Section 602 (b) (iii)).
WHEN TO FILE: File Form 209 within 420 days after the effective date of the registration statement in Pennsylvania.
FORM 209 1. For a further explanation of terms used in the Form, refer to Section 102 of the Pennsylvania Securities Act of 1972 (''Act'').
2. One manually signed copy of the Form with all attachments shall be filed with the Commission. If mailed, it is advisable to send it by registered or certified mail, postage prepaid, return receipt requested.
3. Typewrite or print all answers in the space provided. Answer each item completely. An answer of ''not applicable'' is inappropriate. If the space is insufficient, attach a schedule to the Form and make reference to each item included in the schedule.
4. The Form filed with the Commission must be manually signed by the issuer. If the issuer is a corporation, it should be signed in the name of the corporation by an executive officer duly authorized; if a partnership, it should be signed in the name of the partnership by a general partner; and if an unincorporated association or other organization not a partnership; this Form should be signed in the name of such organization by a person responsible for the direction or management of its affairs.
5. In the event that, at any time after the filing of the Form, the issuer becomes aware that any information provided on the Form becomes inaccurate in any material respect, the issuer shall file an amendment with the Commission within 5 business days from the date the issuer became aware that the information previously submitted was inaccurate at the time it was filed.
6. In lieu of answering any specific question in the Form, the issuer may incorporate by reference information contained in any document attached thereto or previously on file with the Commission. Any such reference should be to the page and paragraph number or other specified portion of the document where the information is located.
7. Please remove instruction sheet before filing this Form.
FILE NO.: ______
FORM 209
COMMONWEALTH OF PENNSYLVANIA
PENNSYLVANIA SECURITIES COMMISSION
PART I Issuer Information 1. Exact Name of Issuer: __________
2. Address of Principal Office of Issuer: __________Number and Street
__________City State Zip Code Telephone No.3. Name and address of person to whom correspondence regarding this filing should be sent:
__________Name Title Number and Street
__________City State Zip Code Telephone No.
PART II Report of Sales of Securities Registered under Section 206. 4. Date of effectiveness of registration statement under Section 206 __________
5. (A) Offering in Pennsylvania:
(i) Total number of shares or other units: __________
(ii) Per share or unit price: __________
(iii) Maximum aggregate offering price: __________
(B) Sales in Pennsylvania or other units: __________
(i) Number of shares or other units: __________
(ii) Aggregate offering price: __________
Each of the persons executing this report on behalf of the Issuer hereby affirms that the statements made herein, including all attachments hereto, are not incomplete in any material respect or false or misleading with respect to any material fact. Each of such persons further affirms that he is familiar with the penalties contained in the Pennsylvania Securities Act of 1972, and all regulations adopted thereunder for making any false or incomplete statement in connection with the sale of a security or in any filing with the Commission.
IN WITNESS WHEREOF, this report has been executed on (insert date)
__________(Name of Issuer)
By: ____________________(Title)
Subpart F. ADMINISTRATION
CHAPTER 606. MISCELLANEOUS POWERS OF COMMISSION § 606.011. Financial reports to security holders.
(a) In the case of securities issued under section 203(d) of the act (70 P. S.§ 1-203(d)), or registered under sections 205 or 206 of the act (70 P. S. §§ 1-205 and 1-206), the issuer shall, so long as the securities are held of record by a Commonwealth resident, deliver its financial statements to each holder at least annually and within 120 days after the close of the fiscal year of the issuer.
(b) The financial statements shall comply with section 609(c) of the act (70 P. S. § 1-609(c)) and the rules and regulations adopted thereunder, except that, if the securi-ties were issued in a transaction subject to this section wherein none of the financial statements delivered to offerees were required to be audited or if no financial statements were required to be given to the offerees, the financial statements need not be audited.
(c) This section does not apply if, on the date of the close of the issuer's fiscal year, the issuer is subject to sections 13 or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.A. §§ 78m and 78o(d)) and, within 120 days of that date, has made a filing with the United States Securities and Exchange Commission in accordance with either of those sections.
[Pa.B. Doc. No. 97-1620. Filed for public inspection October 10, 1997, 9:00 a.m.]
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