A security that
is exempt by Section 3 of the SECURITIES ACT OF 1933 from all requirements
of the act, except the fraud provisions of Section 17.
As specified in
the act, the following are exempt securities:
1. Any security issued or guaranteed by the United States or any territory
thereof, or by the District of Columbia, or by any state of
the United States, or by any political subdivision of a state
or territory, or by any public instrumentality of one or more states or
territories exercising an essential governmental function, including industrial
Any security issued or guaranteed by any corporation created and controlled
or supervised by and acting as an instrumentality of the government
of the United States, pursuant to authority granted by the
Congress of the United States.
3. Any security issued or guaranteed by any national bank, or by any banking
However, the preceding exemption from registration requirements of the
Securities Act of 1933, for "any security issued or guaranteed
by bank" does not include any interest or participation in
any collective trust fund maintained by a bank (meaning any national bank,
District of Columbia bank, or any banking institution organized under
the laws of any state or territory).
But the exemption does apply to any interest or participation in
any common trust fund or similar fund maintained by a bank
exclusively for the collective investment and reinvestment
of assets contributed thereto by such bank in its capacity as trustee,
executor, administrator, or guardian.
The preceding notwithstanding, the term "bank" in the case of a
collective trust fund or common trust fund or similar fund has the same
meaning as in the Investment Company Act of 1940 (see
Moreover, the preceding
numbered exemption from registration requirements of the
4. Any security issued by or representing an interest
in or a direct obligation of a Federal
5. Any note, draft, bill of exchange, or bankers acceptance which arises
out of a current
6. Securities issued by nonprofit organizations.
7. Securities issued by savings and loan, building and loan, or similar organizations,
provided the withdrawal fee at or before maturity is not in
excess of 3%.
8. Securities issued by motor carriers subject to the Interstate Commerce
Act, or any interest in a railroad equipment trust.
9. Certificates issued by a receiver or by a trustee in bankruptcy with court
Insurance policies and annuity contracts issued by corporations subject
to supervision of state insurance or banking commissioners.
11. Securities exchanged by an issuer with existing security holders exclusively,
12. Securities sold solely to residents of the state in which the issuer is
The SECURITIES AND
EXCHANGE COMMISSION may from time to time by its rules and regulations,
and subject to such terms and conditions as may be therein prescribed,
add any class of securities to the securities exempted (15 U.S.C. 77c(b)).
It can do this if it finds that the enforcement of the registration
requirement with respect to such securities is not necessary in the public
interest and for the protection of investors because of the small amount
involved or the limited character of the public offering, except where
the aggregate amount at which such issue is offered to the public exceeds
$500,000 (Regulation A general exemption for U.S. and Canadian issues
up to that amount). The commission
has adopted the following additional exemptions:
Regulation B exemption for fractional undivided interests in oil or gas
rights up to $250,000.
Regulation E exemption for securities of a small business
investment company up to
Regulation F exemption for assessments on assessable stock
and for assessable stock offered or sold to realize the amount
of assessment up to $300,000.
Rules 234-237 and 240 exemptions of first lien notes, securities
of cooperative housing corporations, shares offered in connection
with certain transactions, certain securities owned for five
years, and certain limited offers and sales of small dollar amounts of
securities by closely held issuers.