Administrative Rules of Montana › Department 6 - STATE AUDITOR › Chapter 6.10 - SECURITIES DEPARTMENT › Subchapter 6.10.3 - Exemptions › Rule 6.10.305 - FOREIGN SECURITY EXEMPTION

Current through Register Vol. 13, July 5, 2024
(1) Securities
				offered or sold in compliance with the following conditions are exempt from the
				registration requirements of
				30-10-202 through
				30-10-207, MCA:
(a) A nonissuer transaction, by or through a
				registered broker-dealer, in an outstanding security (including an American
				depository receipt representing such a security) of an issuer domiciled in a
				foreign country with which the United States is at the time of the transaction
				maintaining diplomatic relations, if the class of security has been outstanding
				in the hands of the public for not less than 90 days preceding the date of the
				transaction.
(i) This exemption is not
				available for sales of securities constituting an unsold allotment to, or
				subscription by, the broker-dealer as a participant in the distribution of the
				securities by the issuer or by or through an underwriter.
(ii) This exemption is not available unless
				one of the following requirements is met:
(A)
				the most recent edition of Mergent's Manual or Standard & Poor's
				Corporation Records, or the periodic supplements to such publications, as well
				as all commonly recognized formats of the manuals including CD-ROM and
				electronic dissemination over the internet, contains a description of the
				issuer's business or operations, the names of the issuer's officers and
				directors (or their corporate equivalents in the issuer's country of domicile),
				an externally audited balance sheet of the issuer as of a date within 18 months
				of the date of the transaction and audited profit and loss statements for each
				of the issuer's two fiscal years immediately preceding the date of such balance
				sheet (such statements to be prepared in accordance with U.S. or foreign GAAP);
				or
(B) the issuer of the security
				has a class of securities subject to the reporting requirements of section 13
				of the Securities Exchange Act of 1934, 15 U.S.C. 78 m or section 15(d) of the
				Securities Exchange Act of 1934, 15 U.S.C. 78 m or section 15(d) of the
				Securities Exchange Act of 1934, 15 U.S.C. 78 o(d) and is not delinquent in
				such reporting; or
(C) the security
				is exempted from the provisions of section 12(g) of the Securities Exchange Act
				of 1934, 15 U.S.C. 78 l(g) by section 12(g)(3) of that Act, 15 U.S.C. 78
				l(g)(3), and the issuer is in compliance with all of the conditions of 17 CFR
				240.12g3 - 2 (b)(1).
(iii) This exemption is not available unless
				all of the following requirements are met:
(A) the issuer, including any predecessors,
				has been in continuous operation for at least the preceding two years, is a
				going concern actually engaged in business and is not in an organizational or
				developmental stage, and is not in bankruptcy or receivership;
(B) the issuer has net tangible assets of at
				least U.S. $25,000,000 as of the date of its most recent externally audited
				financial statement prepared in accordance with U.S. or foreign GAAP. Such
				statement shall be dated as of a date within 18 months of the date of the
				transaction;
(C) the issuer had an
				average gross income of at least U.S. $5,000,000 over its most recent two
				consecutive years of operation according to audited profit and loss statements
				of the issuer prepared in accordance with U.S. or foreign GAAP for the issuer's
				two fiscal years immediately preceding the date of the financial statement
				referred to in (1)(a)(iii)(B);
(D)
				the issuer has a class of securities listed or traded on a stock exchange or
				automated quotation system organized under the laws of its country of domicile;
				and
(E) for the issuer's securities
				in the United States, there are at least two market makers who are registered
				broker-dealers under the Securities Exchange Act of 1934 and who has an excess
				net capital of a least U.S. $10,000,000.