N.H. Rev. Stat. § 421-B:2-202 — NH Code / Title XXXVIII / Chapter 421-B / Section 2-202
421-B:2-202 Exempt Transactions.
Status: in_force

The following transactions are exempt from the requirements of RSA 421-B:3-301 through RSA 421-B:3-306 and RSA 421-B:5-504: (1) an isolated nonissuer transaction, whether effected by or through a broker-dealer or not, provided that no person shall make sales to more than 5 purchasers (as determined in accordance with RSA 421-B:2-202-A(1)), in total, of securities of the same issuer, in all jurisdictions combined, during any period of 12 consecutive months; (2) a nonissuer transaction by or through a broker-dealer registered, or exempt from registration, under this chapter, and a resale transaction by a sponsor of a unit investment trust registered under the Investment Company Act of 1940, in a security of a class that has been outstanding in the hands of the public for at least 90 days, if, at the date of the transaction: (A) the issuer of the security is engaged in business, the issuer is not in the organizational stage or in bankruptcy or receivership, and the issuer is not a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that its primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person; (B) the security is sold at a price reasonably related to its current market price; (C) the security does not constitute the whole or part of an unsold allotment to, or a subscription or participation by, the broker-dealer as an underwriter of the security or a redistribution; (D) a nationally recognized securities manual or its electronic equivalent designated by order issued under this chapter or a record filed with the Securities and Exchange Commission that is publicly available contains: (i) a description of the business and operations of the issuer; (ii) the names of the issuer's executive officers and the names of the issuer's directors, if any; (iii) an audited balance sheet of the issuer as of a date within 18 months before the date of the transaction or, in the case of a reorganization or merger when the parties to the reorganization or merger each had an audited balance sheet, a pro forma balance sheet for the combined organization; and (iv) an audited income statement for each of the issuer's 2 immediately previous fiscal years or for the period of existence of the issuer, whichever is shorter, or, in the case of a reorganization or merger when each party to the reorganization or merger had audited income statements, a pro forma income statement; and (E) any one of the following requirements is met: (i) the issuer of the security has a class of equity securities listed on a national securities exchange registered under section 6 of the Securities Exchange Act of 1934 or designated for trading on the Nasdaq Stock Market; (ii) the issuer of the security is a unit investment trust registered under the Investment Company Act of 1940; (iii) the issuer of the security, including its predecessors, has been engaged in continuous business for at least 3 years; or (iv) the issuer of the security has total assets of at least $2,000,000 based on an audited balance sheet as of a date within 18 months before the date of the transaction or, in the case of a reorganization or merger when the parties to the reorganization or merger each had such an audited balance sheet, a pro forma balance sheet for the combined organization; (3) a nonissuer transaction by or through a broker-dealer registered, or exempt from registration, under this chapter in a security of a foreign issuer that is a margin security as defined in regulations or rules adopted by the Board of Governors of the Federal Reserve System; (4) a nonissuer transaction by or through a broker-dealer registered, or exempt from registration, under this chapter in an outstanding security if the guarantor of the security files reports with the Securities and Exchange Commission under the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, 15 U.S.C. section 78m or 78o(d); (5) a nonissuer transaction by or through a broker-dealer registered, or exempt from registration, under this chapter in a security that: (A) is rated at the time of the transaction by a nationally recognized statistical rating organization in one of its 4 highest rating categories; or (B) has a fixed maturity or a fixed interest or dividend, if: (i) a default has not occurred during the current fiscal year or within the 3 previous fiscal years or during the existence of the issuer and any predecessor if less than 3 fiscal years, in the payment of principal, interest, or dividends on the security; and (ii) the issuer is engaged in business, is not in the organizational stage or in bankruptcy or receivership, and is not and has not been within the previous 12 months a blank check, blind pool, or shell company that has no specific business plan or purpose or has indicated that its primary business plan is to engage in a merger or combination of the business with, or an acquisition of, an unidentified person; (6) a nonissuer transaction by or through a broker-dealer registered, or exempt from registration, under this chapter effecting an unsolicited order or offer to purchase; (7) a nonissuer transaction executed by a bona fide pledgee without the purpose of evading this chapter; (8) a nonissuer transaction involving an offer or sale to a federal covered investment adviser with investments under management in excess of $100,000,000 acting in the exercise of discretionary authority in a signed record for the account of others; (9) a transaction in a security, whether or not the security or transaction is otherwise exempt, in exchange for one or more bona fide outstanding securities, claims, or property interests, or partly in such exchange and partly for cash, if the terms and conditions of the issuance and exchange or the delivery and exchange and the fairness of the terms and conditions have been approved by the secretary of state after a hearing conducted pursuant to RSA 421-B:6-605; (10) a transaction between the issuer or other person on whose behalf the offering is made and an underwriter, or a transaction among underwriters; (11) A nonissuer sale of notes or bonds secured by a mortgage to no more than 5 purchasers as determined in accordance with RSA 421-B:2-202-A(1), in total, in all jurisdictions combined; (12) a judicial sale, exchange, or issuance of securities made pursuant to an order of a court of competent jurisdiction, including without limitation a bankruptcy court, or a transaction by an executor, administrator of an estate, sheriff, marshal, receiver, trustee in bankruptcy, guardian, or conservator; (13) a sale or offer to sell to: (A) an institutional investor; (B) a federal covered investment adviser; or (C) any other person exempted by order issued by the secretary of state under this chapter; (14) a sale or an offer to sell securities of an issuer, if the transaction is part of a single offering (as determined in accordance with RSA 421-B:2-202-A(2)) in which: (A) sales are not made to more than 25 purchasers (as determined in accordance with RSA 421-B:2-202-A(1)), in all jurisdictions combined, during any 12 consecutive months, other than sales designated in subsection (13) and subsection (21); (B) a general solicitation or general advertising is not made in connection with the offer to sell or sale of the securities; (C) a commission or other remuneration is not paid or given, directly or indirectly, to a person other than a broker-dealer registered under this chapter or an agent registered under this chapter for soliciting a prospective purchaser in this state; and (D) the issuer reasonably believes that all the purchasers in this state, other than those designated in subsection (13), are purchasing for investment; (15) a transaction under an offer to bona fide existing security holders of the issuer, including persons that at the date of the transaction are holders of convertible securities, options, or warrants, if a commission or other remuneration, other than a standby commission, is not paid or given, directly or indirectly, for soliciting a security holder in this state; (16) an offer to sell, but not a sale, of a security not exempt from registration under the Securities Act of 1933 if: (A) a registration or offering statement or similar record as required under the Securities Act of 1933 has been filed, but is not effective, or the offer is made in compliance with Rule 165 adopted under the Securities Act of 1933, 17 C.F.R. 230.165; and (B) a stop order of which the offeror is aware has not been issued against the offeror by the secretary of state or the Securities and Exchange Commission, and an audit, inspection, or proceeding that is public and that may culminate in a stop order is not known by the offeror to be pending; (17) an offer to sell, but not a sale, of a security exempt from registration under the Securities Act of 1933 if: (A) a registration statement has been filed under this chapter, but is not effective; (B) a solicitation of interest is provided in a record to offerees in compliance with an order adopted by the secretary of state under this chapter; and (C) a stop order of which the offeror is aware has not been issued by the secretary of state under this chapter and an audit, inspection, or proceeding that may culminate in a stop order is not known by the offeror to be pending; (18) a transaction involving the distribution of the securities of an issuer to the security holders of another person in connection with a merger, consolidation, exchange of securities, sale of assets, or other reorganization to which the issuer, or its parent or subsidiary and the other person, or its parent or subsidiary, are parties; (19) a rescission offer, sale, or purchase under RSA 421-B:5-510, provided that the terms of such offer, sale or purchase and material disclosures are approved in advance by the secretary of state pursuant to RSA 421-B:5-510(5); (20) an offer or sale of a security to a person not a resident of this state and not present in this state if the offer or sale does not constitute a violation of the laws of the state or foreign jurisdiction in which the offeree or purchaser is present and is not part of an unlawful plan or scheme to evade this chapter; (21) an employees' stock purchase, savings, stock option, restricted stock, profit-sharing, pension, or similar employees' benefit plan, including any securities, plan interests, and guarantees issued under a compensatory benefit plan or compensation contract, contained in a record, established by the issuer, its parents, its majority-owned subsidiaries, or the majority-owned subsidiaries of the issuer's parent for the participation of their employees including offers or sales of such securities to: (A) directors; general partners; trustees, if the issuer is a business trust; officers; consultants; and advisors; (B) family members who acquire such securities from those persons through gifts or domestic relations orders; (C) former employees, directors, general partners, trustees, officers, consultants, and advisors if those individuals were employed by or providing services to the issuer when the securities were initially offered to such person; and (D) insurance agents who are exclusive insurance agents of the issuer, or the issuer's subsidiaries or parents, or who derive more than 50 percent of their annual income from those organizations; (22) a transaction involving: (A) a stock dividend or equivalent equity distribution, whether the corporation or other business organization distributing the dividend or equivalent equity distribution is the issuer or not, if nothing of value is given by stockholders or other equity holders for the dividend or equivalent equity distribution other than the surrender of a right to a cash or property dividend if each stockholder or other equity holder may elect to take the dividend or equivalent equity distribution in cash, property, or stock; (B) an act incident to a judicially approved reorganization in which a security is issued in exchange for one or more outstanding securities, claims, or property interests, or partly in such exchange and partly for cash; or (C) the solicitation of tenders of securities by an offeror in a tender offer in compliance with Rule 162 adopted under the Securities Act of 1933, 17 C.F.R. 230.162; (23) A nonissuer transaction in a outstanding security by or through a broker dealer registered or exempt from registration under this chapter, if the issuer is a reporting issuer in a foreign jurisdiction designated by this subsection or by order issued under this chapter by the secretary of state; has been subject to continuous reporting requirements in the foreign jurisdiction for not less than 180 days before the transaction; and the security is listed on the foreign jurisdiction's securities exchange that has been designated by this subsection or by order issued under this chapter by the secretary of state, or is a security of the same issuer that is of senior or substantially equal rank to the listed security or is a warrant or right to purchase or subscribe to any of the foregoing. For purposes of this subsection, Canada, together with its provinces and territories, is a designated foreign jurisdiction and The Toronto Stock Exchange, Inc., is a designated securities exchange. After an administrative hearing in compliance with RSA 421-B:6-605, the secretary of state, by order issued under this chapter, may revoke the designation of a securities exchange under this subsection, if the secretary of state finds that revocation is necessary or appropriate in the public interest and for the protection of investors; or (24) an offer or sale by a cooperative association organized and operated as a nonprofit entity under the laws of any state of its securities only if (A) such securities are either (i) offered and sold in connection with establishing bona fide membership in such association or (ii) issued as a patronage dividend to its bona fide members, (B) in the case of a purchase, the purchase of such securities is necessary or incidental to establishing membership in such association, and (iii) the primary purpose of membership in such association is to obtain or derive one or both of goods and services. (25) A purchase or sale of an open blockchain token if all of the following are met: (A) The issuer or seller of the token, or the registered agent of the developer or seller, files a notice of intent with the secretary of state, as specified in subsection (D) of this section; (B) The purpose of the token is for a consumptive purpose, which shall only be exchangeable for, or provided for the receipt of, goods, services or content, including rights of access to goods, services or content; and (C) The issuer or seller of the token did not sell the token to the initial buyer as a financial investment. For purposes of this subsection, a developer seller of the token will be deemed not to have sold the token to the initial buyer as a financial investment if: (i) The issuer or seller did not market the token as a financial investment; and (ii) At least one of the following is true: (a) The issuer or seller of the token reasonably believed that it sold the token to the initial buyer for a consumptive purpose; (b) The token has a consumptive purpose that is available at the time of sale and can be used at or near the time of sale for use for a consumptive purpose; (c) If the token does not have a consumptive purpose available at the time of sale, the initial buyer of the token is prevented from reselling the token until the token is available for use for a consumptive purpose; or (d) The issuer or seller takes other reasonable precautions to prevent buyers from purchasing the token as a financial investment. (D) The issuer, seller or person who facilitates the exchange of an open blockchain token, or the registered agent of the applicable person, files a notice of intent with the secretary of state prior to offering or selling the tokens in this state. The notice of intent shall contain the name of the person acting as an issuer, seller or facilitator, the contact information of the person or the registered agent of the person, and a statement that any marketing or advertising materials, including web sites offering or selling open blockchain tokens, will contain a disclosure that the tokens are not registered as securities pursuant to a transaction exemption under RSA 421-B, the New Hampshire Uniform Securities Act. The notice shall also specify whether the person will be acting as an issuer, seller or facilitator. A form shall be made available by the office of the secretary of state on its Internet website for this purpose. The secretary of state shall charge a fee of $100 per filing.