(a) It is the intent of the State Securities Board
that §109.13(a)-(c) and (j) of this title (relating to Limited
Offering Exemptions) apply to transactions made pursuant to the Securities
Act, §5.Q, and that the terms defined in §109.13(a)-(c)
and (j) of this title (relating to Limited Offering Exemptions) have
the same meanings for purposes of §5.Q as they do for the Securities
Act, §5.I.
(b) For the purposes of §5.Q, an employee of the
owner of an oil, gas, or mineral lease, fee, or title may aid such
owner/employer in selling interests in such lease, fee, or title and
will not be considered an agent required to be licensed under the
Act provided all the following conditions are satisfied:
(1) the employee was not hired for the purpose of
offering or selling such securities;
(2) the employee's activity involving the offer and
sale of such securities is strictly incidental to his bona fide primary
nonsecurities-related work duties; and
(3) the employee's compensation is based solely on
the performance of such other duties, i.e., the employee does not
receive any compensation for offering for sale, selling, or otherwise
aiding in the sale of securities.
(c) In addition to sales made under the Securities
Act, §5.Q, the State Securities Board, pursuant to the Act, §5.T,
exempts from the registration requirements of the Act, §7, the
sale of interests in and under oil, gas, and mining leases, fees,
or titles, or contracts relating thereto (hereinafter called securities),
by the owner itself, or by a registered dealer acting as agent for
the owner, provided all of the conditions of §109.13(k) or (l)
of this title (relating to Limited Offering Exemptions) are met. The
purpose of this subsection is to provide a mechanism which will allow
for sales of the securities listed herein to accredited investors
where the conditions of §109.13(k) or (l) of this title (relating
to Limited Offering Exemptions) are met.
(d) Exemption for transactions among persons in the
oil and gas industry.
(1) In addition to offers and sales made pursuant to
the Act, §5.Q, the State Securities Board, pursuant to the Act,
§5.T, exempts from the securities registration requirements
of the Act, §7, and the dealer and agent registration requirements
of the Act, §12 and §18, the offer and sale of any interest
in or under an oil, gas, or mining lease, fee, or title, or payments
out of production in or under such leases, fees, or titles or contracts
relating thereto by the owner or an agent for the owner when such
offer or sale is made to persons and/or companies each of whom the
owner or owner's agent shall have reasonable cause to believe and
does believe meets the following criteria:
(A) is engaged in the business of exploring for or
producing oil, gas, or other minerals as an ongoing business or is
engaged in the practice of a profession, or discipline, which is directly
related to the exploration for, production of, refining of, or marketing
of oil, gas, or other minerals such as the interest being sold; or
(B) is a landman, drilling company, well service company,
production company, refining company, geologist, geophysicist, petroleum
engineer, earth scientist; or
(C) is an executive officer of a company whose primary
plan of business involves either subparagraphs (A) or (B) of this
paragraph.
(2) The offer to a person who did not meet the criteria
set forth in paragraph (1)(A)-(C) of this subsection will not cause
the exemption to be lost if such offer was not made indiscriminately.
(3) For purposes of this rule, an "agent for the owner"
includes the following:
(A) officers, directors, and employees who are actively
engaged in the day-to-day activities of the owner;
(B) independent landmen, engineers, geologists, and
consultants who have a contractual working relationship with the owner;
(C) persons who meet the dealer registration requirements
of the Securities Act, §12; and
(D) persons who represent the owner in transactions
exclusively with persons described in paragraph (1)(A)-(C) of this
subsection.
(4) This exemption includes sales at auction.
(e) Any person who acts as an agent of an owner or
a purchaser in connection with a sale of an interest described in
subsection (d) of this section to a person who does not meet the criteria
set forth in subsection (d)(1)(A)-(C) of this section will not be
exempt from the dealer registration requirements of the Act, §12,
unless another exemption is available.
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