Ins 6.41(4)(d)(d) Exemption of long term profits incident to sales within 6 months of the exercise of an option.
Ins 6.41(4)(d)1.1. To the extent specified in subd. 2., the commissioner hereby exempts as not comprehended within the purposes of s. 611.31 (4) (b), Stats., any transaction or transactions involving the purchase and sale, or sale and purchase, of any equity security where such purchase is pursuant to the exercise of an option or similar right either acquired more than 6 months before its exercise; or acquired pursuant to the terms of an employment contract entered into more than 6 months before its exercise.
Ins 6.41(4)(d)2.2. In respect of transactions specified in subd. 1. the profits inuring to the insurer shall not exceed the difference between the proceeds of sale and the lowest market price of any security of the same class within 6 months before or after the date of sale. Nothing in this par. (d) shall be deemed to enlarge the amount of profit which would inure to such insurer in the absence of this par. (d).
Ins 6.41(4)(d)3.3. The commissioner also hereby exempts, as not comprehended within the purposes of s. 611.31 (4) (b), Stats., the disposition of a security, purchased in a transaction specified in subd. 1., pursuant to a plan or agreement for merger or consolidation, or reclassification of the insurer’s securities, or for the exchange of its securities for the securities of another person which has acquired its assets, or which is in control, as defined in section 368(c) of the Internal Revenue Code of 1954, of a person which has acquired its assets, where the terms of such plan or agreement are binding upon all stockholders of the insurer except to the extent that dissenting stockholders may be entitled, under statutory provisions or provisions contained in the certificate of incorporation, to receive the appraised or fair value of their holdings.
Ins 6.41(4)(d)4.4. The exemptions provided by this par. (d) shall not apply to any transaction made unlawful by s. 611.31 (4) (c), Stats., or by any rules and regulations thereunder.
Ins 6.41(4)(d)5.5. The burden of establishing market price of a security for the purpose of this par. (d) shall rest upon the person claiming the exemption.
Ins 6.41(4)(e)(e) Exemption from s. 611.31 (4) (b), Stats., of certain acquisitions and dispositions of securities pursuant to merger or consolidations.
Ins 6.41(4)(e)1.1. The following transactions shall be exempt from the provisions of s. 611.31 (4) (b), Stats., as not comprehended within its purpose:
Ins 6.41(4)(e)1.a.a. The acquisition of a security of an insurer, pursuant to a merger or consolidation, in exchange for a security of a company which, prior to said merger or consolidation, owned 85% or more of the equity securities of all other companies involved in the merger or consolidation except, in the case of consolidation, the resulting company;
Ins 6.41(4)(e)1.b.b. The disposition of a security, pursuant to a merger or consolidation of an insurer which, prior to said merger or consolidation, owned 85% or more of the equity securities of all other companies involved in the merger or consolidation except, in the case of consolidation, the resulting company:
Ins 6.41(4)(e)1.c.c. The acquisition of a security of an insurer, pursuant to a merger or consolidation, in exchange for a security of a company which, prior to said merger or consolidation, held over 85% of the combined assets of all the companies undergoing merger or consolidation, computed according to their book values prior to the merger or consolidation as determined by reference to their most recent available financial statements for a 12-month period prior to the merger or consolidation.
Ins 6.41(4)(e)1.d.d. The disposition of a security, pursuant to a merger or consolidation, of an insurer which, prior to said merger or consolidation, held over 85% of the combined assets of all the companies undergoing merger or consolidation, computed according to their book values prior to merger or consolidation, as determined by reference to their most recent available financial statements for a 12-month period prior to the merger or consolidation.
Ins 6.41(4)(e)2.2. A merger within the meaning of this par. (e) shall include the sale or purchase of substantially all the assets of one insurer by another in exchange for stock which is then distributed to the security holders of the insurer which sold its assets.
Ins 6.41(4)(e)3.3. Notwithstanding the foregoing, if an officer, director or stockholder shall make any purchase (other than a purchase exempted by this par. (e)) of a security in any company involved in the merger or consolidation and any sale (other than a sale exempted by this par. (e)) of a security in any other company involved in the merger or consolidation within any period of less than 6 months during which the merger or consolidation took place, the exemption provided by this par. (e) shall be unavailable to such officer, director, or stockholder.
Ins 6.41(4)(f)(f) Exemption from s. 611.31 (4) (b), Stats., of certain securities received upon surrender of similar equity securities. Any receipt by a person from an insurer of shares of stock of a class having general voting power, upon the surrender by such person of an equal number of shares of stock of the insurer of a class which does not have general voting power, pursuant to provisions of the insurer’s certificate of incorporation, for the purpose of and accompanied simultaneously or followed immediately by the sale of the shares so received, shall be exempt from the operation of s. 611.31 (4) (b), Stats., as a transaction not comprehended within its purpose, if the following conditions exist:
Ins 6.41(4)(f)1.1. The person so receiving such shares is not an officer or director, or the beneficial owner, directly or indirectly, immediately prior to such receipt, of more than 10% of an equity security of the insurer;
Ins 6.41(4)(f)2.2. The shares surrendered and the shares issued upon such surrender shall be of classes which are freely transferable and entitle the holders thereof to participate equally per share in all distributions of earnings and assets;
Ins 6.41(4)(f)3.3. The surrender and issuance are made pursuant to provisions of a certificate of incorporation which requires that the shares issued upon such surrender shall be registered upon issuance in the name of a person or persons other than the holder of the shares surrendered and may be required to be issued as the right only in connection with the public offering, sale and distribution of such shares and the immediate sale by such holder of such shares for that purpose, or in connection with a gift of such shares;
Ins 6.41(4)(f)4.4. Neither the shares so surrendered nor any shares of the same class, nor other shares of the same class as those issued upon such surrender, have been or are purchased (otherwise than in a transaction exempted by this par. (f)), by the person surrendering such shares, within 6 months before or after such surrender or issuance.
Ins 6.41(4)(g)(g) Exemption from s. 611.31 (4) (b), Stats., of certain transactions involving an exchange of similar securities. Any acquisition or disposition of securities made in an exchange of shares of a class (or series thereof) of stock of an insurer for an equivalent number of shares of another class (or series thereof) of stock of the same insurer, pursuant to a right of conversion under the terms of the insurer’s articles of incorporation or other governing instruments shall be exempt from the operation of s. 611.31 (4) (b), Stats., if:
Ins 6.41(4)(g)1.1. The shares surrendered and those acquired in exchange therefor evidence substantially the same rights and privileges except that, pursuant to the provisions of the insurer’s articles of incorporation or other governing instruments, the board of directors may declare and pay a lesser dividend per share on shares of the class surrendered than on shares of the class acquired in exchange therefor, or may declare and pay no dividend on shares of the class surrendered; and
Ins 6.41(4)(g)2.2. The transaction was effected in contemplation of a public sale of the shares acquired in the exchange; provided that par. (g) shall not be construed to exempt from the operation of s. 611.31 (4) (b), Stats., any purchase or sale of shares of the class surrendered and any sale or purchase of shares of the class acquired in the exchange (otherwise than in the transaction of exchange exempted by par. (g)) within a period of less than 6 months.
Ins 6.41(5)(5)Rules under s. 611.31 (4) (c), Stats.
Ins 6.41(5)(a)(a) Exemption of certain securities from s. 611.31 (4) (c), Stats. Any security shall be exempt from the operation of s. 611.31 (4) (c), Stats., to the extent necessary to render lawful under such section the execution by a broker of an order for an account in which he or she has no direct or indirect interest.
Ins 6.41(5)(b)(b) Exemption from s. 611.31 (4) (c), Stats., of certain transactions effected in connection with a distribution. Any security shall be exempt from the operation of s. 611.31 (4) (c), Stats., to the extent necessary to render lawful under such section any sale made by or on behalf of a dealer in connection with a distribution of a substantial block of securities, upon the following conditions:
Ins 6.41(5)(b)1.1. The sale is represented by an over-allotment in which the dealer is participating as a member of an underwriting group, or the dealer or a person acting on his or her behalf intends in good faith to offset such sale with a security to be acquired by or on behalf of the dealer as a participant in an underwriting, selling or soliciting-dealer group of which the dealer is a member at the time of the sale, whether or not the security to be so acquired is subject to a prior offering to existing security holders or some other class of persons; and
Ins 6.41(5)(b)2.2. Other persons not within the purview of s. 611.31 (4) (c), Stats., are participating in the distribution of such block of securities on terms at least as favorable as those on which such dealer is participating and to an extent at least equal to the aggregate participation of all persons exempted from the provisions of s. 611.31 (4) (c), Stats., by this par. (b). However, the performance of the functions of manager of a distributing group and the receipt of a bona fide payment for performing such functions shall not preclude an exemption which would otherwise be available under this par. (b).
Ins 6.41(5)(c)(c) Exemption from s. 611.31 (4) (c), Stats., of sales of securities to be acquired.
Ins 6.41(5)(c)1.1. Whenever any person is entitled, as an incident to ownership of an issued security and without the payment of consideration, to receive another security “when issued” or “when distributed,” the security to be acquired shall be exempt from the operation of s. 611.31 (4) (c), Stats., provided that: