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Exempt Offerings Under Regulation E

Regulation E provides a conditional exemption from registration under the Securities Act of 1933, for securities of small business investment companies which are licensed under the Small Business Investment Act of 1958 or which have received the preliminary approval of the Small Business Administration and have been notified by the Administration that they may submit an application for such a license.

The regulation, which is similar in many respects to the general exemption provided by Regulation A, requires the filing of a notification with the Commission and, except in the case of offerings not in excess of $50,000, the filing and use of an offering circular containing certain specified information.

Regulation E provides for the suspension of exemption in particular cases if the Commission finds that any of the terms and conditions of the regulation have not been met or complied with.

There were no filings under Regulation E during the 1962 fiscal year. Exempt Offerings Under Regulation F

Regulation F provides an exemption from registration under the Securities Act for assessments levied upon assessable stock and for delinquent assessment sales in amounts not exceeding $300,000 in any one year. It requires the filing of a simple notification giving brief information with respect to the issuer, its management, principal security holders, recent and proposed assessments and other security issues. The regulation requires a company to send to its stockholders, or otherwise publish, a statement of the purposes for which the proceeds from the assessment are proposed to be used. If the issuer should employ any other sales literature in connection with the assessment, copies of such literature must be filed with the Commission.

During the 1962 fiscal year, 36 notifications were filed under Regulation F, covering assessments of $1,300,246. Regulation F notifications were filed in three of the nine regional offices of the Commission: Denver, San Francisco, and Seattle. Underwriters were not employed in any of the Regulation F assessments.

Regulation F provides for the suspension of an exemption thereunder, as in Regulation A, where the regulation provides no exemption or where the offering is not made in accordance with the terms and conditions of the regulation or in accordance with prescribed disclosure standards.

One Regulation F filing was temporarily suspended in the fiscal year 1962. A request for hearing was made but was later withdrawn and the issuer consented to the issuance of a permanent suspension order.



OF 1934

The Securities Exchange Act of 1934 is designed to ensure the maintenance of fair and honest markets in securities transactions on the organized exchanges and in the over-the-counter markets. Accordingly, the Act provides for the registration and regulation of securities exchanges and the registration of securities listed on such exchanges, and it establishes for issuers of securities so registered, financial and other reporting requirements, regulation of proxy solicitations and requirements with respect to trading by directors, officers and principal security holders. The Act also provides for the registration and regulation of brokers and dealers doing business in the over-thecounter market, contains provisions designed to prevent fraudulent, deceptive and manipulative acts and practices on the exchanges and in the over-the-counter markets and authorizes the Federal Reserve Board to regulate the use of credit in securities transactions.


Registration and Exemption of Exchanges

As of June 30, 1962, 14 stock exchanges were registered under the Exchange Act as national securities exchanges: American Stock Exchange

Pacific Coast Stock Exchange Boston Stock Exchange

Philadelphia-Baltimore Stock Chicago Board of Trade

Exchange Cincinnati Stock Exchange

Pittsburgh Stock Exchange Detroit Stock Exchange

Salt Lake Stock Exchange Midwest Stock Exchange

San Francisco Mining Exchange National Stock Exchange

Spokane Stock Exchange New York Stock Exchange

There have been no sales of securities on the Chicago Board of Trade since 1953. The National Stock Exchange was granted registration as a national securities exchange on August 16, 1960, and commenced to operate on March 7, 1962.

Four exchanges were exempted from registration by the Commission pursuant to Section 5 of the Act: Colorado Springs Stock Exchange Richmond Stock Exchange Honolulu Stock Exchange

Whecling Stock Exchange

Disciplinary Action

Each national securities exchange reports to the Commission disciplinary actions taken against its members and member firms for violation of the Securities Exchange Act of 1934 or of exchange rules. During the year 9 exchanges reported 96 cases of such disciplinary actions, including imposition of fines aggregating $48,575 in 57 cases; the suspension from membership of 13 individuals and 5 member firms; the expulsion of 1 individual from associate membership and another from allied membership; and the censure of a number of individuals and firms.


It is unlawful for a member of a national securities exchange or a broker or dealer to effect any transaction in a security on such exchange unless the security is registered on that exchange under the Securities Exchange Act or is exempt from such registration. In general, the Act exempts from registration obligations issued or guaranteed by a State or the Federal Government or by certain subdivisions or agencies thereof and authorizes the Commission to adopt rules and regulations exempting such other securities as the Commission may find necessary or appropriate to exempt in the public interest or for the protection of investors. Under this authority the Commission has exempted securities of certain banks, certain securities secured by property or leasehold interests, certain warrants and, on a temporary basis, certain securities issued in substitution for or in addition to listed securities.

Section 12 of the Exchange Act provides that an issuer may register a class of securities on an exchange by filing with the Commission and the exchange an application which discloses pertinent information concerning the issuer and its affairs. This must include information in regard to the issuer's business, capital structure, the terms of its securities, the persons who manage or control its affairs, the remuneration paid to its officers and directors, the allotment of options, bonuses and profit-sharing plans, and financial statements certified by independent accountants.

Form 10 is the form used for registration by most commercial and industrial companies. There are specialized forms for certain types of securities, such as voting trust certificates, certificates of deposit and securities of foreign governments.

Section 13 requires issuers having securities registered on an exchange to file periodic reports keeping current the information furnished in the application for registration. These periodic reports include annual reports, semiannual reports, and current reports. The principal annual report form is Form 10-K which is designed to keep

up-to-date the information furnished in Form 10. Semiannual reports required to be furnished on Form 9-K are devoted chiefly to furnishing mid-year financial data. Current reports on Form 8-K are required to be filed for each month in which any of certain specified events have occurred. A report on this Form deals with matters such as changes in control of the registrant, important acquisitions or dispositions of assets, the institution or termination of important legal proceedings and important changes in the issuer's capital securities or in the amount thereof outstanding. Statistics Relating to Registration of Securities on Exchanges

As of June 30, 1962, a total of 2,390 issuers had 4,013 classes of securities listed on registered national securities exchanges, of which 2,821 were classified as stocks and 1,192 as bonds. Of these totals, 1,286 issuers had 1,564 stock issues and 1,142 bond issues listed on the New York Stock Exchange. Thus, 54 percent of the issuers, 55 percent of the stock issues and 96 percent of the bond issues were on the New York Stock Exchange.

During the 1962 fiscal year, 185 issuers listed securities on a registered national securities exchange for the first time, while the registration of all securities of 130 issuers was terminated. The total number of applications for registration of classes of securities on exchanges filed during the 1962 fiscal year was 319.

The following table shows the number of annual, semiannual, and current reports filed during the fiscal year by issuers having securities listed on registered national securities exchanges, and the number of such reports filed by issuers obligated to file reports under Section 15(d) of the Securities Exchange Act of 1934, by virtue of having registered securities under the Securities Act of 1933. The securities of issuers filing reports under Section 15(d) are generally traded in the over-the-counter market. As of June 30, 1962, there were 2,726 such issuers, including 350 that were also registered as investment companies under the Investment Company Act of 1940. The table also includes the number of annual reports, quarterly reports and reports to stockholders filed by issuers subject to the reporting requirements of Section 30 of the Investment Company Act.

Number of annual and other periodic reports filed by issuers under the Securities

Exchange Act of 1934 and the Investment Company Act of 1940 during the fiscal year ended June 30, 1962

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The market value on December 31, 1961, of all stocks and bonds admitted to trading on one or more stock exchanges in the United States was approximately $531,833,403,000.

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425, 984, 253,000

Total stocks....

New York Stock Exchange
American Stock Exchange..
Exclusively on other exchanges..

Total bonds.....

1, 186

73 25

104, 634, 327,000 1,087, 260.000

127, 563,000

1, 284

105,849, 150,000

Total stocks and bonds..

4, 325

531, 833, 403,000

* Bonds on the New York Stock Exchange included 47 U.S. Government and New York State and City issues with $73,903,178,000 aggregate market value.

The New York Stock Exchange and American Stock Exchange figures were reported by those exchanges. There was no duplication of issues between them. The figures for all other exchanges were for the net number of issues appearing only on such exchanges, excluding the many issues which were also traded on one or the other of the New York exchanges. The number and market value of issues as shown excluded those suspended from trading and a few others for

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