Se&rotary of State 

Austin, Texas 

Attention: Mr. Horace B. Seasiona, 

Seaurities Commiasloner 

Dear Sir: Opinion No. O-6311 

He: The Texas Seaurlties 

Act Is applicable to 

an employees retirement plan sponsored 

by a private aorporation. 

We have reoeived your recent request for an opinion, 

and quote same as followa: 

"We have reoently received a request for an 

opinion oonoerning the applioabillty of the Texas 

Seourlties Aat to the solicitation of oontributions 

in an employee8 retirement plan. 

"The essential provisions of the retirement 

plan are: 

"(1) Eligibility of all employees with five 

or more years of servloe vlth the aorporation to 

a-e under the Plan. 

"(2) Participation in the Plan oPtIona with 

the employees, and to be evidenced by an enrollment 

form agreeing to the provisions of the Plan, authorizing salary deduations and naming a beneficiary. 

“(3) Normal retirement at age 65, with earlier 

retFrement optional in certain instances. 

"(4) Emplogees~ contribution should be 2$ of 

salary up to $3,000, and 4% of salary ln'excesa 

of $3,000. 
. 

Secretary of State, Page 2 (o-6311) 

“(5) Rmployee's deposit to 

2$ Interest In any event. 

be returned with 

“(6) Past service benefits for years prior 

to institution of Plan In excess of five, and 

aurrent servloe benefits after Institution of 

Plan, both to be paid in accordance with formula 

set forth under the Plan. 

“(7) Action as to the manner of reoeiving 

the retirement lnaome provided from past and 

ourrent servFoe benefita, in aoaordanoe tith provisions of the Plan. 

“(8) Admlnistratlon of the Plan by a Retirement 

Plan Committee appointed by Board of Dlreators. 

"(9) Guarantee by employer to contribute suffloient funds to return employees' depoalts with 2% 

interest acmpounded annually, but no guarantee by 

employer corporation In exceaa of such amount. 

"(10) HodlfFcatFon or termination of the Plan 

at wFl1 of corporatlon, exoept a8 to provlsion for 

repayment of the employees' contributions plus @ 

interest oompounded annually. 

"The essential provisions of the +Pruat Agreement 

under which the funds depoarlted under the Plan are to 

be administered are: 

"(1) Deposit with the Trustee at the dlreotion 

of thee.Retirement Plan Gemmlttea of the funds deposited 

by the employees apd the employer ourporation. 

"(2) Payments of the funda of the Plan to benefialarle6 thereunder at the dLreation of the Retirement 

Plan Committee. 

“(3) Investment of the trust funds by the 

Trustee in seaurities which are at the time legal 

investments for life insurance aompanies under the 

laws of the State of Rev York, except Apia othertise 

dlreoted by the,Board of Direatora of the corpoPatiOn. 

"(4) Hodifioation of the Trust Agreement In 

aooordanae with the provisions of the Retirement 

Plan at the will of the employer oorporation. 
Secretary of State, Rage' 3 (O-6311) 

"(5) Report by the Trustee to the oorporatlon 

annually oovering its investmehts, reoelpts land dlsbursements of the trust fund. 

'We have been unable to find any Texas oases or 

an opinion of,the Attorney General whioh would assist 

us In determining whether or not seourlties ,iasued under 

suoh plan might be exempt under one of the speciflo exemptions contained in Seatlons 3 and twenty three of the 

Texas Seaurities Act. 

,the spealflc exemptions 

It does not appear that any of 

contemplated an organization of 

this oharaater, and slnoe Ft appears that there will be 

a number of plans of a sFmFlar nature organized and 

operated in Texas, we should appreciate an opinion from 

you concerning whether aontributlons to suoh,a plan 

would require registration or whether such securFtSes 

might be exempt from the neoessity of registration under 

one of the exemptions provided by Section 3 and 23 of 

the Act. 

"We enclose herewith a copy of the proposed retirement plan and trust agreement under which the funds of 

the plan will be administered for your consideration In 

oonneotion with this request for an oplnton, and we 

should appreciate the return of these Instruments after 

you have finished with them." 

We understand from additional oommunicatlons ~wlth you, 

that the corporation referred to In your Inquiry is a private 

oorporatlon operating under a charter or permit in this State 

for profit. 

Subsection (a), Se&ion 2, of Article 600a, V. A. C. S., 

(The Securities Aat) gives the following.deflnltlon: 

"The term 'security' or 'securities' shall include any share, stock, treasury stock, stock certifioate under a voting trust agreement, collateral 

trust certlfloate, equipment trust oertiflcate, preorganization certlfloate or receipt, subscription or 

reorganization certificate, note, bond, debenture, 

mortgage certificate or other evidence of Fndebtedness, any form of commeroial paper, oertifioate In 

or under a proffFt sharing or participation agreement, certificate or any Instrument representing 

any interest in or under an oil, gas, or mining 
Searetary of State, Page 4 (O-6311) , 

lease, fee or title, or any oertlfioate or lnstrument representing or seoured by an interest 

in any or all of the aapital, property, assets,,' 

profits or earnings of any oompany, investment 

contract, or any other instrument commonly known 

as a seourlty, whether similarto those herein 

referred to or not." 

It Is apparent that the first question raised by 

your query is whether or not the proposed rstFrement plan 

oomes wlthin the definltlon of "security" or "securltLesH. 

Inwol. 38, Words and pbraaem, on pages 470 and 471, the 

following Is said; 

"@enorally, any form of instrument used for 

purpose of financing and promoting eWterpPl.aesj 

whloh is designed for investment, Is a ‘security’ 

within statute authorizing investigations by 

Attorney Gieneral of apparent fraud In sale of 

securities." General Business Law, paragraph 

352, subd. 1. 

160 Miaa. 763. 

In re Waldstein, 291 hX3. 697, 

"The term 'seourityl has no exactly defined 

legal definition. Qenerioally, the word has referenoe to written Instruments, usually for the payment of money or bvldenoes of a debt, and being more 

than a mere promise of the debtor of a general liability on his part, but having as collateral to it 

a pledge of property or some addFt$onal obligation. 

Blackstone speaks of a bill of exchange as a security, which he says was originally Invented among 

merchants~ In different countries for the more easy 

remlttanoe of money from one to the other. In 

aalling it a security, probably he bad in mind the 

fact that a bill of exohange may oonsist of several 

personal obllgatlons, which makes more certain or 

seaure the primary obligation. By common usage,' 

however, the term has acquired a much broader signlfiaation. It is now generally used to refer to 

Instruments for the payment of money, or evidencing 

title or equity, with or without some collateral 

obligation, and whioh are aemmeply dealt In for 

the purpose of flnanolng and investment. By modern 

business methods, those instruments which are used 

to facilitate dealing in aommodities, suoh as 

short term notes, bills of lading, bills of exobange and all the other Inventions of the commercial 
Seerotary of State, Page 5 (o-6311) 

banker, are not referred to as seooritiea, although.they may be collaterally scoured in some 

WY. Those lnstrnments, however, secured or 

unseoured, whioh are~used for the purpose of 

financing enterprises and promoting a distrlbution of rights in or obligations of such enterprises, and whloh are designed as a meana 

of investment, are termed seaurities. Thus, 

oertlfioates of stock are now regarded as 

seourFtles, although they but represent a share 

of the ,oapltal stock of a corporation, the 

Interest of the owner in the management of the 

corporation, and his interest in its surplus 

assets upon Lts dissolution. In generaiL,, It 

may be said that any form of Instrument used 

for the purpose of finanoing and prcmotFng 

enterprises, and which is designed for investment, is a seaurltg acoording to the modern 

meaning of that ,term.' 

We believe the Issuance of said enrollment forms of 

agreement to partialpate In the Retirement Plan, constitutes 

issuanae of "seaurltles", as that term Is defined In The 

Securities Aot. Surely they are "evidence of indebtedness", 

inasmuch as the terms of said Plan provide that in no case 

shall a partialpant be entitled to less than his deposits 

s interest thereon at two per cent per annum oompounded 

mally; ual h 1 d heth he with& aws his membership voluntar?ly(l d~e~"~~~or~e!,itse~is benefitsbefore maturity 

of the Plan. In oase he participates until maturity, he stands 

to realj.ze a substantial return on his investment, but thla 

return Fs by no means certain. The prime purpose of the Plan 

is to "aeaure" the participant a return or profit on his Investment. 

Section 5 of said Artic,le 6ooa provides, in part, 

as follows: 

"Blo dealer, agent or salesman shall sell or 

offoF for sale any securities issued after the 

passage of this Act; except those which come wlthin the alasses, enumerated in Subdivisions (a) to 

(q), both inclusive, of Section 3 of this Act, or 

Subdivisions (a) to (F), both inclusive of Section 

23 of this Aat, until the issuer of such securities 

'shall have been granted a permit by the Secretary 
Secretary of State, page 6 (O-6311) 

of State, and no such permit shall be granted 

by the Searotary of State until the issuer of 

suoh aeaurities shall have filed with the 

Secretary of State a sworn statement verified 

under the oath of an executive officer of the 

Issuer and attested by the Secretary thereof, 

setting forth the following Information: . . ." 

Seation 3 of said Artlale 600a, provides as follows: 

"Exempt transactiona. Except aa hereinafter in 

this Act speciflcally provided, the provl~ions of 

this Aot shall not apply to the sale of any security 

when made In any of the following transactions and 

under any of the following conditions, and the 

company OF person engaged therein shall not be deemed 

a dealer within the meaning of this Aot; thatis to 

nay, the provisions of this Aot shall not apply to 

any aale, offer for sale, solicitation, subsoription, dealing In or delivery of any seaurlty under 

any of the following transactions OF oonditiona: 

"(a) At any judioial, exeoutaP'a, administrator's, 

guardian's OP oonservatcrls nale, or any sale by a reaelvesr OP truatee in Insolvency or bankruptoy. 

holdet(z ZEPtgagee 

e sale by or for the account of a pledge 

selling or offering for sale cr 

delivery in the ordinary course of business, to 

liquidate a bona fide debt, of a seourity pledged in 

good faith as seourity for such debt. 

"(c) Sales of securities made by, or in behalf 

of a vendor In the ordinary couPpIe of bona fide 

personal investment of his personal holdings, or 

change of such investment, If such vendor ia not 

otherwise engaged either permanently or temporarily 

in selling securities, provided, that In no event 

shall suoh sales or offerings be exempt from the 

provls$ons of this Act when made or intended, either 

directly or Fndireatly, for the benefit of any company or aorporation within the purview of this Act. 

"(d) The distribution by a corporation of 

securities direct to its stockholders aa a stook 

dividend or other distribution paid out of earnings 

OP surplus. 
Secretary of State, Page 7 .(p6311) 

"(e) The sale of, au increase of eapltal steak 

of a ,ooFporatlon onl,y to its, sto,ckholders and wlthout payment of any aoximissioa or expense to any 

officer, employee, broker or agents, and without 

incurring auy liablllty for any expenses whatsoever 

In aonneotlon with such distribution. 

"I ~The issue'iu good faith of securities by 

a company to its seaurity holders, or creditors, In 

the process of a bona fide reorganizatFon of the 

company made In good faith, or the issue Fn good 

faith of securities by a company, organ$zed solely 

for the purpose of taking over the assets and continuing the business of a predeoessor ccaspany, to 

the seaurity holders OP creditors of suah predecessor 

company, prmvlded that in either such case such aecurities are issued in exahange for the securities ~of 

such holders or claim of suah creditors, or both, 

and in either such aase such securFty holders OP 

creditors do not pay or give OP promise and are not 

obligated to pay or give any consideration for the 

seourities so issued other than the securities of 

OP olaims against sald company OP its predecessor 

tben held OP owned by them. 

of, 

ers 

"(g) The transfer or exchange by, or on account 

one corporation to another or 'to its stockholdof their or Its own securities in connection with 

a proposed consolidation OF merger of such corporatlon, or in oonnectlon with the change of par value 

stock to non-par value stock or vice versa, OP the 

exahange of outstanding shares for a greater or 

smaller number of shares , provided that in such case 

such stockholders do not pay or give or promise and 

are not obligate'd to pay OP give any consideration 

for the securities so transferred or exchanged 

other than the securities of said aorporation then 

held by them. 

"(h) The sale by a domestic corporation of Its 

stook forfeited for a delinquent assessment, acaordlng to law. 

"(I) The sale' to any~ bank, trust company~, loan 

and brokerage corporation, building and loan association insurance company, surety or guar,anty aompany, 

~savinga institution or to any registered dealer, 

provided such dealer is actually engaged in buying 

and selling securities. 
Secretary of State, Page 8 (o-6311) 

"(j) The sale by any domestla corporation of 

its stoak or other seaurities issued in good faith 

and not for the purposeiof avoiding the provisions 

of this Act, 80 long a8 the total number of stockholders and seourity holders of said corporation 

does not and will not after such sale exceed 

twenty-five (25) and the securities are issued and 

disposed of without the use of advertisements, 

olraulars, agents, salesmen, sollcltors, or any 

form of publia solicitation. 

"(k) The sale of an interest In any partnership, pool, or other company, not a corporation,~ 

the total membership of which does not and will 

not after such sale exaeed ten (lo), and the 

organization expenses of which do not or will not 

exceed two (2) per cent of the total invested 

capital of such company. 

"(1) Subscriptions to aapital stock necessary 

to qualify for incorporation when subscribed by 

not more than fifteen (15) Fnaorporators in a proposed Texas oorporatlon. 

"(m) Wherein the seouritlea disposed of consist exclusively of note8 or bonds secured by 

mortgage or vendor's lien upon'real estate or 

tangible personal property, and the entire mortgage 

is sold or transferred with all of the notes or 

bonds seoured thereby in a single transaatlon. 

"(n) Any security or membership issued by a 

oorporation organized excluslveLy for eduaational, 

benevolent, fraternal, oharitable, OP reformatory 

purposes and not for peaunlary profit, and no part 

of the net earning8 of whloh inures to the benefit 

of any atookholder, shareholder, or individual 

member, and where no commission or remuneration is 

paid OP given or is to be paid or given in conneation with the disposition thereof. 

"(0) The sale by the issuer, itself, of any 

securities that are issued by a State or NatiQnal 

Bank, by a trust company, or building and loan 

association organized and operating under the 

laws of the State of TOXaB and subjeat to the supervlslon of the Commissioner of Banking of the State 

of Texas, OP Federal Loan and Savings Aasoaiation, 
Seoretary of State, Page 9 (O-6311) 

or a oompany aubjeat to the supervision of ~the 

Banking Commissioner under Senate Bill No. 1.65, 

Forty-seaond Legislature. Provided, however, 

that all salesmen aoting for any bank, trust 

aampany, or oompany subjeat to the supervision 

of the Banking Commissioner under Senate Bill 

Eo. 165, Forty-sbaond Legislature, in the sale 

of such seourities within this State, shall be 

liaensed as provided in thLs Aot. 

"(p) The sale, by the issuer itself, of any 

seourities that are issued by the United ,States, 

any political subdivision or agenay thereof, any 

territory or insular possession of the United 

States, the State of Texas, any State of the 

United States, the D$atriot of Columbia,, or by 

any aounty, oity, munioipal corporation, dlstriat 

or politiaal subdivision of the State of Texas or 

any authorized agency of the State of Texas. 

"(q) The sale and laauanae of any seourities 

issued by any farmers1 oooperative assoclatlon 

organized under Chapter 8 of Title 93, Artiales 

5737-5764, lnolusive, Revised Civil Statutes of 

Texas as amended; and the sale of any securities 

Issued by any farmers' cooperative sooletg organizdd under Chapter 5 of Title 46, Artiales 2514- 

2524, inalusive, Revised Civil Statutes of Texas. 

Provided, however, this exemption ahall not~be 

applicable to agents and salesmen of any farmers' 

oooperatlve assoelation of farmers' cooperative 

sooiety when the sale of such aecurlties is made 

to non-members, OP when the sale of auah securities 

Is made either to members OP non-members and a 

aanmlssion is paid 'or contracted to be paid to the 

said agent or salesmen." 

Se&Ion 23 of said Artlale 6ooa, provides as followzr 

"Exaept with referenae to exempt transactions 

profided for in Section 3 of this Aat, it shall be 

unlawful for any dealer, agent 0~ salesman to sell 

any securities or to issue or publish withln this 

State any oiroular, advertisement, pamphlet, prospeotus, program, or other matter in conneotlon therewith, oonoerning any seourlty or seauritles which 

suoh dealer handles or proposes to sell until suah 
Searotary of State, Page 10 (O-6311) 

dealer shall have been registered or temporary 

permission obtained as in this Act providedj 

provided however, that any suoh airaular, ad-' 

vertisement, pamphlet, prospeotus, program, or 

other matter in aonnectinn therewith may include 

the names of non-registered dealers who have 

partlalpated with registered dealer3 in the 

original purohaae or underwrItIng of suoh securities without being deemed to be in violation of 

this' Act, but if the mines of non-registered 

dealers are lnoluded thereon, then suoh oircular, 

advertisement, pamphlet, program or other matter 

in oonneotion therewith shall bear a legend tbereon in plain and legible type, stating that such 

seourities are being offered within the State of 

Texas only by such persons whose names are subscribed thereon as are registered dealers withlri 

the State of Texas. Unless the same ha8 reference 

to an exempt transaotion provided for in Section 3 

of this Aot, OP refers to any of the seaurltlea 

hereinafter expressly exempted from this provision, 

It shall be unlawful for any dealer, agent or ~aalesman to Issue or publish within this State any 

oiroular, advertisement, pamphlet, prospectus, or 

other matter In oonneotion therewith concerning 

any security or securities to be sold or offered 

for sale In this State unless the name of the 

dealer is subscribed thereto or rinted thereon 

and unless a true copy of such c f Pcular, advertisement, pamphlet, prospectus or program, or other 

matter in connection therewith has first been filed 

in the office of the Secretary of State by the 

person or company about to Issue or publish the 

same OP baa been deposited In a United States 

Post Offioe, properly enclosed In an envelops 

addressed to the Secretary of State at Austin, 

Texas, with the postage duly prepaid thereof; 

provided, however, that In the Case of an advertisement to be published In a newspaper OP 

other perlodioal, a oopy of 8uch advertisement 

taken from said publication may be mailed to the 

Searotary of State within twenty-four (241) hours 

after the first publiaation thereof; provided, 

further, that when offered for sale, or Bold, 

or dealt in by a registered salesman of a registered dealer, this provision shall have no 

appllaation to any security Included within any 

of the following classes~ 
Seoretary of State, Page 11 (O-6311) 

"(a) Any seourity Issued or guaranteed by the 

United States or by any territory or insular possession thereof; or by the District of Columbia, 

or by any State or municipal corporation ok polltiaal subdivlslon or agency thereof having the 

power of taxation or assessment. 

"(b) Any security issued or guaranteed by any 

foreign government with which the United State8 is 

atthe time of the sale, ok offer of sale thereof, 

maintaining diplomatia relations, OP by any State, 

provlnae or political subdivlslon thereof having 

the power of taxation or assessment, which security 

is recognized at the time it Is offered for sale 

in this State as a valid obligation by such foreign 

government or by such State, province, or political 

subdivision thereof Issuing the same, provided, however, that such securities must be on the list approved by the Securities and Exchange Commission 

of the United States. 

"(0) Any seourlty Issued by and representing 

an interest In ok a direct obligation of a natlonal 

bank, or of a governmental agency created or existing by an Act of Congress of the United States other 

than corporations created or existing under the 

Code of Laws for the District of Columbia OP under 

the Code of Law3 for any territory or possession of 

the United States. 

"(d) Any security issued OF guaranteed either 

a8 to prinalpal, interest, or dividend, by a torporation owning or operating a railroad OP any other 

public service utility; provided, that such corporation is subject to regulation or supervision either 

as to its rates and charges or as to the issue of 

its own securities by the Railroad Commisslon of 

Texas, OP by a public comml33lon, board of officers, 

having like powers, of the Government of the United 

States, or of any State, Territory, or insular 

possession thereof, OP of the DistrFot of Columbia, 

or of the Damlnion of Canada, or any province thereof; 

also equlpnent trust certificate3 or equipment notes 

or bonds based on chattel mortgages, lease3 or agreements for conditional sale of cars, motlve power or 

other rolling stock mortgages, leased or sold t0 OP 

furnished for the use of OP upon a railroad or other 

public service utility corporation, provided that 

such corporation is subjeot to regulation or super- 
Secretary of State, Page 12 (O-6311) 

vision as above;~or equFpment trust certificates, 

or equipment notes or bonds where the ownership 

or title of suoh equipment is pledged or retained 

in accordance with the provlsions of the laws of 

the United States, or of any State, Territory or 

Insular possession thereof, or of the District of 

Columbia, or the Dominion of Canada, or any provinoe thereof, to secure the payment of such equipment trust oertifloates, bonds or notes. 

“(e) Any security Issued and sold by a 

domestic corporation without capital stook and 

not organFzed and not engaged in business for 

profFt. 

“(f) Securities whioh at the time of sale have 

been fully listed upon the New York Stock Exchange, 

the Chioago Stock Exchange, the Boston Stock Exohange, 

or upon any other recognized and responsible stock 

exchange whioh has been previously approved by the 

Secretary of State as hereinafter in this Section 

provided, and also all securities senior to, or if 

of the same issues, upon a parity with any securities 

so listed or represented by subscrlptlon rFghts whloh 

have been so listed, or evidence of indebtedness 

guaranteed by any company any stock of which Is so 

listed, such securities to be exempt only so long as 

such listing shall remain in effect and only so long 

as the exchange upon which such securities are so 

listed remains approved under the provisions of thFs 

Section, application for approval by the Secretary 

of State may be made by any organized stook exohange 

In suoh manner and upon such forms as may be presoribed by the Secretary of State, but no approval 

of any such exchange shall be gFven unless the 

facts and data supplled with the application shall 

be found to establish: 

“(1) That the requirement8 for the 1Fstlng of 

securities upon the exchange so seeking approval are 

such as to effect substantially the reasonable protection to the public now existing In the case of 

exchanges herein approved. 

“(2) That the governing constitution, by-laws, 

and/or regulations of suoh exohanges shall require: 
8earetary of State, Page 1,3 (O-6311) 

"1st: An adequate examination into the affaairs 

of the timer of the ssouritles which are to be 

listed before permitting trading thorein. 

'2nd: That the issuer of such securities, 80 

long as they be listed, shall periadically prepare, 

make public and furnish promptly to the exohange, 

appropriate fLnanala1, insame and profit and loss 

statements. 

"3rd: Securities listed and traded in on such 

exohange to be restrioted to those of ascertained, 

sound asset and/or inoorne value. 

"4tht A reasonable surveillanoe of Its members, 

lnoludlng a requirement for periodical financial 

statements and a determination of the financial responsibility of its members and the right and obligation in the governing body of suah exchange to 

suspend and/or expel any member found to be flnanoially 

embarrassed or irresponsible or found to have been 

guilty of aisoondoot in his business dealings, or 

oonduot prejudiolal to the rights or Interests of his 

oust~s. 

'The approval of any such exchange by the 

Secretary of State shall be made only after a 

reasonable hearing and investigation, and shall 

be by an order of approval upon a finding of faot 

substantially in aooordanoe with the requirements 

hereinabove ovidbd. 

upon ten (10 $ 

The Secretary of State, 

days' notice and hearing, shall 

have power at any time to withdraw approval theretofore granted by him to any such stock exohange, 

and thereupon securities so listed upon suoh 

exchange shall be no longer entitled to the bane-' 

fit of such exemption exoept upon the further 

order of said Secretary of State again approving 

such exohange. 

"(g) Ang secmltg issued or guaranteed byand/or 

representing an Interest in or a direst obligation of 

a state bank or trust onmpany lnoorporated under the 

laws of and subject to the examination, 8uperviaFon 

and control of any state or territory of the United 
Secretary of State, Page 14 (o-6311) 

Statesorany insular possession*.therebf;- or 

issued or guaranteed by any building and loan 

association or savings Institution or by any 

Fnsuranoe company under the supervision or 

control of the Banking or Insurance Department 

of this State. 

"(h) Negotiable promissory notes or commercial 

paper Issued in good faith and in the usual course 

of carrylng on and conducting the business of th.e 

issuer, provided that such notes or commercial 

paper mature In not more than twelve (12) months 

from the date of issue. 

"(1) Notes, bonds, or other evidence of Fndebtedness or certificates of ownership which are equally 

and proportionately secured without reference or priority 

of one over another, and which, by the terms of ,the 

instrument creating the lien, shall continue to be so 

seoured by the deposit with a trustee of recognized 

responsibility approved by the Secretary of State of 

any of the seourltles specified in subsections (a) 

and (b), or of any of the securities, other than 

stock, specified in subseotlon (d) of this Section 

23, such deposited securities, if of the classes 

desoribed in subseotlons (a) and (b) hereof, having 

an a gre ate par value of not less than one hundred 

and &en y 110 ) percent of the par value of the securities 

thereby seoured, and If of the class specified in subsection (d) hereof, having an aggregate par value of 

not less than one hundred and twenty-five (125) per 

cent of the par value of the securities thereby 

scoured." 

We have carefully examined the statutory exemptions 

above set out and are unable to find therein authority for 

exempting the issuer of the securities inoident to the proposed Retirement Plan from the requirements of Section 5 of 

Article 600a, supra, other than that expressed in subsection 

(j) of said Section 3 of Art. 600a, wherein domestic oorporations are allowed to sell their stook or other securities 

Issued in good faith and not for the purpose of avoiding the 

provisions of the Securities Act, so long as the total number 

of stockholders and security holders of said corporation does 

not and will not after suoh sale exoeed twenty-five (25) 

and the securltles are issued and disposed of without the 

use of ad9ertlsements circulara, agents, salesmen, soll.cFtors, 

or any form of publio solioitation~ This is the only one of 

the statutory exemptions that might apply to the Retirement 

Plan in question. 
Seoretary of State, Page 15 (0-6311) 

Trusting the foregoing fully answera your inquiry, 

we herewith retnrn the instruments submitted by you. 

Yours very truly, 

ATTORNEYGENERALOFTEXAS 

BY /s/Robert L. Lattimore, Jr. 

Robert L. Lattimore, Jr. 

Assistant 

RLL:rt:rpjs 

Attach. 

APPROVED FEB. 19, 1% 

4%3~%%~2 

ATTORNEYGENERAL 

APPROVED OPINION COMMITTEE 

BY /a/ JAR CHAIRMAN