Corporations, Associations, and Partnerships
Rhode Island Uniform Securities Act
Exemptions from Registration
R.I. Gen. Laws § 7-11-401
§ 7-11-401. Exempt securities.
The following securities are exempt from §§ 7-11-301 and 7-11-404:
(1) A security, including a revenue obligation, issued, insured, or guaranteed by the United States, an agency or corporate or other instrumentality of the United States, an international agency or corporate or other instrumentality of which the United States and one or more foreign governments are members, a state, a political subdivision of a state, or an agency or corporate or other instrumentality of one or more states or their political subdivisions; or a certificate of deposit for any of the foregoing, but this exemption does not include a security payable solely from revenues to be received from a nongovernmental industrial or commercial enterprise unless the payments are insured or guaranteed by a person described as the issuer, insurer or guarantor of securities under subsection (2), (3), (4), (5), (7), or (8) of this section, or unless the revenues from which the payments are to be made are a direct obligation of a person;
(2) A security issued, insured, or guaranteed by Canada, a Canadian province or territory, a political subdivision of Canada or a Canadian province or territory, an agency or corporation or other instrumentality of one or more of the foregoing, or any other foreign government or governmental combination or entity with which the United States maintains diplomatic relations, if the security is recognized as a valid obligation by the issuer, insurer, or guarantor;
(3) A security issued by and representing an interest in or a direct obligation of, or guaranteed by, a depository institution if the deposit or share accounts of the depository institution are insured by the federal deposit insurance corporation, the federal savings and loan insurance corporation, the national credit union share insurance fund, or a successor to the applicable agency authorized by federal law;
(4) A security issued by and representing an interest in or a direct obligation of, or insured or guaranteed by, an insurance company organized under the laws of any state and authorized to do business in this state;
(5) A security issued or guaranteed by a railroad, other common carrier, public utility, or holding company that is:
(i) Subject to the jurisdiction of the Interstate Commerce Commission;
(ii) A registered holding company under the Public Utility Holding Company Act of 1935, 15 U.S.C. § 79 et seq. [repealed], or a subsidiary of a registered holding company within the meaning of that act;
(iii) Regulated as to its rates and charges by a governmental authority of the United States or a state; or
(iv) Regulated as to the issuance or guarantee of the security by a governmental authority of the United States, a state, Canada, or a Canadian province or territory;
(6) Equipment trust certificates as to equipment leased or conditionally sold to a person, if securities issued by the person would be exempt under this section;
(7) A security listed or approved for listing upon notice of issuance on a national securities exchange registered under § 6 of the Securities Exchange Act of 1934, 15 U.S.C. § 78f; any other security of the same issuer which is of senior or substantially equal rank; a security called for by subscription right or warrant so listed or approved; or a warrant or right to purchase or subscribe to any of the securities in this subsection;
(8) A security designated or approved for designation upon notice of issuance as a national market system security by the National Association of Securities Dealers, Inc.; any other security of the same issuer which is of senior or substantially equal rank; a security called for by subscription right or warrant so designated; or a warrant or a right to purchase or subscribe to any of the securities in this subsection;
(9) An option issued by a clearing agency registered under the Securities Exchange Act of 1934, 15 U.S.C. § 78a et seq., other than an off exchange futures contract or substantially similar arrangement, if the security, currency, commodity, or other interest underlying the option:
(i) Is registered under § 7-11-302, 7-11-303, or 7-11-304;
(ii) Is exempt under this section; or
(iii) Is not otherwise required to be registered under this chapter;
(10) A security issued by a person organized and operated not for private profit but exclusively for a religious, educational, benevolent, charitable, fraternal, social, athletic, or reformatory purpose, or as a chamber of commerce or trade or professional association;
(11) A promissory note, draft, bill of exchange, or bankers' acceptance that evidences an obligation to pay cash within nine (9) months after the date of issuance, exclusive of days of grace, is issued in denominations of at least fifty thousand dollars ($50,000) and receives a rating in one of the three (3) highest rating categories from a nationally recognized statistical rating organization; or a renewal of an obligation that is likewise limited, or a guarantee of an obligation or of a renewal;
(12) A security issued in connection with an employee's stock purchase, savings, option, profit sharing, pension, or similar employees' benefit plan;
(13) A membership or equity interest in, or a retention certificate or like security given in lieu of a cash patronage dividend issued by, a cooperative organized and operated as a nonprofit membership cooperative under the cooperative laws of any state if not traded to the public;
(14) A security issued by an issuer registered as an open end management investment company or unit investment trust pursuant to § 8 of the Investment Company Act of 1940, 15 U.S.C. § 80a-8, if:
(i) The issuer is advised by an investment adviser that is a depository institution exempt from registration under the Investment Advisers Act of 1940, 15 U.S.C. § 80b-1 et seq., or that is currently registered as an investment adviser and has been registered, or is affiliated with an adviser that has been registered as an investment adviser under the Investment Advisers Act of 1940, 15 U.S.C. § 80b-1 et seq., for at least three (3) years immediately before an offer or sale of a security claimed to be exempt under this subsection (14)(i) and has acted, or is affiliated with an investment adviser that has acted, as investment adviser to one or more registered investment companies or unit investment trusts for at least three (3) years immediately before an offer or sale of a security claimed to be exempt under this subsection (14)(i); or
(ii) The issuer has a sponsor that has at all times throughout the three (3) years before an offer or sale of a security claimed to be exempt under this subsection (14)(ii) sponsored one or more registered investment companies or unit investment trusts the aggregate total assets of which have exceeded one hundred million dollars ($100,000,000).
(iii) The director has received prior to any sale exempted in this section:
(A) A notice of intention to sell which has been executed by the issuer which states the name and address of the issuer and the title of the securities to be offered in this state; and
(B) A filing fee of one thousand dollars ($1,000).
(iv) In the event any offer or sale of an open end management investment company is to be made more than twelve (12) months after the date notice under subsection (14)(iii) is received by the director, another notice and payment of the applicable fee is required.
For the purpose of subsection (14) an investment adviser is affiliated with another investment adviser if it controls, is controlled by, or is under common control with the other investment adviser.
History of Section.
P.L. 1990, ch. 460, § 2; P.L. 1991, ch. 69, § 1; P.L. 2003, ch. 376, art. 24, § 1.