(a) Availability. The exemption from securities registration
provided by the Texas Securities Act, §4005.011, or this section
is not available if the financial institution or other institutional
investor named therein is in fact acting only as agent for another
purchaser that is not a financial institution or other institutional
investor listed in §4005.011 or this section. These exemptions
are available only if the financial institution or other institutional
investor named therein is acting for its own account or as a bona
fide trustee of a trust organized and existing other than for the
purpose of acquiring the specific securities for which the seller
is claiming the exemption.
(b) Sales to certain institutional investors. The State
Securities Board, pursuant to the Act, §4005.024, exempts from
the securities registration requirements of the Act, Chapter 4003,
Subchapters A, B, and C, the offer and sale of any securities to any
of the following persons:
(1) an "institutional accredited investor," as that
term is defined in §107.2 of this title (relating to Definitions),
excluding, however, any self-directed employee benefit plan with investment
decisions made solely by persons that are "individual accredited investors"
as defined in §107.2 of this title;
(2) any "qualified institutional buyer" (as that term
is defined in §107.2 of this title (relating to Definitions));
and
(3) a corporation, partnership, trust, estate, or other
entity (excluding individuals) having net worth of not less than $5
million, or a wholly-owned subsidiary of such entity, as long as the
entity was not formed for the purpose of acquiring the specific securities.
(c) Financial statements. For purposes of determining
a purchaser's total assets or net worth under this section, the issuer
and the seller may rely upon the entity's most recent annual balance
sheet or other financial statement which shall have been audited by
an independent accountant or which shall have been verified by a principal
of the purchaser.
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Source Note: The provisions of this §109.4 adopted to be effective July 14, 2005, 30 TexReg 3987; amended to be effective June 21, 2011, 36 TexReg 3714; amended to be effective March 21, 2021, 46 TexReg 1733; amended to be effective July 18, 2024, 49 TexReg 5141 |