The section 3(a)(10) exemption has been torpedoed but is still afloat and making headway

Article Abstract:

Indirect changes made to section 3(a)(10) of the Securities Act of 1933 by the National Securities Markets Improvement Act of 1996 (NSMIA) resulted in certain limitations upon that section's securities registration and delivery exemption. The section is particularly useful in merger and acquisition transactions where public resale of acquired securities is governed by the section and clear SEC ground rules. The exemption is still viable in light of a great deal of relevant regulatory activity which has occurred since the effective date of the NSMIA.

Regulation, Licensing, and Inspection of Miscellaneous Commercial Sectors, Trading Regulations, Stock transfer, Securities trading

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The "pooling period": an overlooked "legal landmine." (accounting for acquisition in a corporate reorganization)

Article Abstract:

Affiliates of corporations acquired for stock in the acquiring corporation may not sell any of that stock under SEC regulation 145(d)(1) if the buyer plans to account for the transaction as a pooling in interests rather than a purchase. The tendered securities are considered restricted until the sale has closed in 30 days. The use of the pooling method has not been voided by sale of the tendered securities in recorded case law, but would probably have to depend on the promptness of discovery.

Acquisitions and mergers, Syndicates (Finance)

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The Section 3(a)(10) exemption is alive and well -- the SEC staff will amend Staff Legal Bulletin No. 3

Article Abstract:

The Securities Litigation Uniform Standards Act of 1998 eliminated the preemption of state fairness hearings on the sale of securities that the National Securities Markets Improvement Act of 1996 had required. SEC staff will amend Staff Legal Bulletin No. 3 to reflect the change in law.

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