Source: https://www.ssb.texas.gov/october-14-2016
Timestamp: 2019-04-24 00:32:36+00:00

Document:
The Texas State Securities Board proposes an amendment to §109.7, concerning secondary trading exemption under the Texas Securities Act, §5.O. The proposal would update the "manual exemption" contained in §5.O of the Act. Included in §5.O is the requirement that certain information about the issuer appear in either a recognized securities manual or on a form (Form 133.5 or 133.6) filed with the Securities Commissioner. The definition of "recognized securities manual," as defined by the Board in §109.7(e), would be amended as follows.
First, to emphasize that the information relied on to claim the exemption must be current, an explanation would be added to reference the type of information required in subsection (d) and a reminder that the financial information provided must be within 18 months of the date of the sale relying upon the exemption.
Second, to add the electronic information available on www.otcmarkets.com, in connection with a current or recent listing on the OTCQX or OTCQB, as a "recognized securities manual" for purposes of §5.O(9). The OTCQX and OTCQB markets require that companies listing on these markets disclose all of the information required by §5.O and §109.7 and that the information be publicly available for free on OTC Markets Group's website.
Finally, for greater ease in using the exemption and to limit the need to amend it when publications are merely added or renamed, subsection (e) would be amended to recognize the publisher of the Mergent manuals, rather than list the name of each specific manual.
Although the list of manuals in subsection (e) will include the S&P Capital IQ Standard Corporation Descriptions, S&P ceased publication of its manual as of May 2, 2016. Prior publications of the manual are available online. At the present time the Board is not removing the S&P publication from the list of manuals since some of the financial information contained therein may not be stale and parties may continue to rely upon the listing to meet the exemption.
Clinton Edgar, Director, Registration Division, has determined that for the first five-year period the rule is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the rule.
Mr. Edgar also has determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be that registered dealers seeking reliance upon the exemption contained in §5.O of the Texas Securities Act will have notice of the manuals included among the Board's "recognized securities manuals" for purposes of the exemption. There will be no effect on micro- or small businesses. Since the rule will have no adverse economic effect on micro- or small businesses, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the rule as proposed. There is no anticipated impact on local employment.
The proposal affects Texas Civil Statutes, Article 581 5.O.
Filed with the Office of the Secretary of State on September 30, 2016.

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