§ 7-11-401 - Exempt securities.
SECTION 7-11-401
§ 7-11-401 Exempt securities. – The following securities are exempt from §§ 7-11-301 and 7-11-404:
(1) A security, including a revenue obligation, issued,insured, or guaranteed by the United States, an agency or corporate or otherinstrumentality of the United States, an international agency or corporate orother instrumentality of which the United States and one or more foreigngovernments are members, a state, a political subdivision of a state, or anagency or corporate or other instrumentality of one or more states or theirpolitical subdivisions; or a certificate of deposit for any of the foregoing,but this exemption does not include a security payable solely from revenues tobe received from a nongovernmental industrial or commercial enterprise unlessthe payments are insured or guaranteed by a person described as the issuer,insurer or guarantor of securities under subdivision (2), (3), (4), (5), (7),or (8) of this section, or unless the revenues from which the payments are tobe made are a direct obligation of a person;
(2) A security issued, insured, or guaranteed by Canada, aCanadian province or territory, a political subdivision of Canada or a Canadianprovince or territory, an agency or corporation or other instrumentality of oneor more of the foregoing, or any other foreign government or governmentalcombination or entity with which the United States maintains diplomaticrelations, if the security is recognized as a valid obligation by the issuer,insurer, or guarantor;
(3) A security issued by and representing an interest in or adirect obligation of, or guaranteed by, a depository institution if the depositor share accounts of the depository institution are insured by the federaldeposit insurance corporation, the federal savings and loan insurancecorporation, the national credit union share insurance fund, or a successor tothe applicable agency authorized by federal law;
(4) A security issued by and representing an interest in or adirect obligation of, or insured or guaranteed by, an insurance companyorganized under the laws of any state and authorized to do business in thisstate;
(5) A security issued or guaranteed by a railroad, othercommon carrier, public utility, or holding company which is:
(i) Subject to the jurisdiction of the interstate commercecommission;
(ii) A registered holding company under the Public UtilityHolding Company Act of 1935, 15 U.S.C. § 79 et seq., or a subsidiary of aregistered holding company within the meaning of that act;
(iii) Regulated as to its rates and charges by a governmentalauthority of the United States or a state; or
(iv) Regulated as to the issuance or guarantee of thesecurity by a governmental authority of the United States, a state, Canada, ora Canadian province or territory;
(6) Equipment trust certificates as to equipment leased orconditionally sold to a person, if securities issued by the person would beexempt under this section;
(7) A security listed or approved for listing upon notice ofissuance on a national securities exchange registered under § 6 of theSecurities Exchange Act of 1934, 15 U.S.C. § 78a et seq.; any othersecurity of the same issuer which is of senior or substantially equal rank; asecurity called for by subscription right or warrant so listed or approved; ora warrant or right to purchase or subscribe to any of the securities in thissubdivisions;
(8) A security designated or approved for designation uponnotice of issuance as a national market system security by the nationalassociation of securities dealers, inc.; any other security of the same issuerwhich is of senior or substantially equal rank; a security called for bysubscription right or warrant so designated; or a warrant or a right topurchase or subscribe to any of the securities in this subdivision;
(9) An option issued by a clearing agency registered underthe Securities Exchange Act of 1934, 15 U.S.C. § 78a et seq., other thanan off exchange futures contract or substantially similar arrangement, if thesecurity, currency, commodity, or other interest underlying the option:
(i) Is registered under § 7-11-302, 7-11-303, or7-11-304;
(ii) Is exempt under this section; or
(iii) Is not otherwise required to be registered under thischapter;
(10) A security issued by a person organized and operated notfor private profit but exclusively for a religious, educational, benevolent,charitable, fraternal, social, athletic, or reformatory purpose, or as achamber of commerce or trade or professional association;
(11) A promissory note, draft, bill of exchange, or bankers'acceptance that evidences an obligation to pay cash within nine (9) monthsafter the date of issuance, exclusive of days of grace, is issued indenominations of at least fifty thousand dollars ($50,000) and receives arating in one of the three (3) highest rating categories from a nationallyrecognized statistical rating organization; or a renewal of an obligation thatis likewise limited, or a guarantee of an obligation or of a renewal;
(12) A security issued in connection with an employee's stockpurchase, savings, option, profit sharing, pension, or similar employees'benefit plan;
(13) A membership or equity interest in, or a retentioncertificate or like security given in lieu of a cash patronage dividend issuedby, a cooperative organized and operated as a nonprofit membership cooperativeunder the cooperative laws of any state if not traded to the public;
(14) A security issued by an issuer registered as an open endmanagement investment company or unit investment trust pursuant to § 8 ofthe Investment Company Act of 1940, 15 U.S.C. § 80a-1 et seq., if:
(i) The issuer is advised by an investment adviser that is adepository institution exempt from registration under the Investment AdvisersAct of 1940, 15 U.S.C. § 80b-1 et seq., or that is currently registered asan investment adviser and has been registered, or is affiliated with an adviserthat has been registered as an investment adviser under the Investment AdvisersAct of 1940, 15 U.S.C. § 80b-1 et seq., for at least three (3) yearsimmediately before an offer or sale of a security claimed to be exempt underthis subparagraph and has acted, or is affiliated with an investment adviserthat has acted, as investment adviser to one or more registered investmentcompanies or unit investment trusts for at least three (3) years immediatelybefore an offer or sale of a security claimed to be exempt under thissubparagraph; or
(ii) The issuer has a sponsor that has at all timesthroughout the three (3) years before an offer or sale of a security claimed tobe exempt under this subparagraph sponsored one or more registered investmentcompanies or unit investment trusts the aggregate total assets of which haveexceeded one hundred million dollars ($100,000,000).
(iii) The director has received prior to any sale exempted inthis section:
(a) A notice of intention to sell which has been executed bythe issuer which states the name and address of the issuer and the title of thesecurities to be offered in this state; and
(b) A filing fee of one thousand dollars ($1,000).
(iv) In the event any offer or sale of an open end managementinvestment company is to be made more than twelve (12) months after the datenotice under subdivision (14)(iii) is received by the director, another noticeand payment of the applicable fee is required.
For the purpose of this subsection an investment adviser isaffiliated with another investment adviser if it controls, is controlled by, oris under common control with the other investment adviser.