New Jersey § 49:3-50

§ 49:3-50.

(a) The following securities are exempted from the provisions of sections 13 and 16

of P.L.1967, c. 93 ( C.49:3-60 and 49:3-63 ): (1) Any security (including a revenue obligation) issued or guaranteed by the United

States, any state, any political subdivision of a state, or any agency or corporate

or other instrumentality of one or more of the foregoing; or any certificate of deposit

for any of the foregoing; (2) Any security issued or guaranteed by Canada, any Canadian province, any political

subdivision of any such province, any agency or corporate or other instrumentality

of one or more of the foregoing, or any other foreign government with which the United

States currently maintains diplomatic relations, if the security is recognized as

a valid obligation by the issuer or guarantor; (3) Any security issued by and representing an interest in or a debt of, or guaranteed

by, any bank, savings institution, or trust company organized and supervised under

the laws of any state or under the laws of the United States; (4) Any security issued by and representing an interest in or a debt of, or guaranteed

by, any savings institution; (5) Any security issued by and representing an interest in or a debt of, or guaranteed

by, any insurance company organized under the laws of any state and authorized to

do business in this State; (6) (Deleted by amendment, P.L.1997, c. 276 .) (7) Any security issued or guaranteed by any railroad, other common carrier, public

utility, or holding company which is (i) a registered holding company under the “Public

Utility Holding Company Act of 1935” 1 or a subsidiary of such a company within the meaning of that act; (ii) regulated

in respect to its rates and charges by a governmental authority of the United States

or any state; or (iii) regulated in respect of the issuance or guarantee of the security

by a governmental authority of the United States, any state, Canada or any Canadian

province; (8) Any security listed or approved for listing upon notice of issuance on the New

York Stock Exchange or the American Stock Exchange, and such other exchanges as the

bureau chief may from time to time designate by rule or order; any security designated

or approved for designation upon notice of issuance as a Nasdaq National Market security

or any other national quotation system as the bureau chief from time to time may designate

by rule or order; any other security of the same issuer which is of senior or substantially

equal rank; any security called for by subscription rights or warrants so listed

or approved; or any warrant or right to purchase or subscribe to any of the foregoing; (9) Any security issued by a person organized and operated exclusively for religious,

educational, benevolent, fraternal, charitable or reformatory purposes and not for

pecuniary profit, and no part of the net earnings of which inures to the benefit of

any person, private stockholder, or individual; (10) Any commercial paper which arises out of a current transaction or the proceeds

of which have been or are to be used for current transactions, and which evidences

an obligation to pay cash within 12 months of the date of issuance, exclusive of days

of grace, or any renewal of such paper which is likewise limited, or any guarantee

of such paper or of any such renewal; (11) Any investment contract issued in connection with an employees' or professional

stock purchase, savings, pension, profit-sharing, retirement or similar benefit plan

and securities issued pursuant to an employee benefit plan; (12)(a) The bureau chief by rule or order, as to a particular security or class of

securities, may adopt a securities exemption (i) that will further the objectives

of compatibility with the exemptions from securities registration authorized by the

“Securities Act of 1933” and uniformity among the states, or (ii) if the bureau chief

determines that the public interest does not require registration. (b) The following transactions are exempted from the provisions of sections 13 and

16 of P.L.1967, c. 93 ( C.49:3-60 and 49:3-63 ): (1) Any isolated nonissuer transaction, whether effected through a broker-dealer or

not; (2)(i) Any nonissuer transaction by a broker-dealer registered under this act of a

security, which has been outstanding in the hands of the public for at least 90 days

prior to the transaction and which is sold at a price reasonably related to the current

market price of such securities, provided: (A) the securities are of an issuer for which all reports required to be filed by

section 13 or 15(d) of the “Securities Exchange Act of 1934,” 15 U.S.C. s.78m or s.78o(d) have been filed; or (B) the following information is published in a recognized securities manual: the

names of the issuer's officers and directors; a balance sheet of the issuer as of

a date not more than 18 months prior to the date of the sale; and profit and loss

statements for a period of not less than two years next prior to the date of the balance

sheet or for the period of the issuer's existence as of the date of the balance sheet

if the period of existence is less than two years; (ii) The exemption provided in this paragraph (2) does not apply if the sale constitutes

a distribution and is made for the direct or indirect benefit of an issuer or controlling

persons of that issuer or if those securities constitute the whole or part of an unsold

allotment to, or subscription by, a broker-dealer as an underwriter of those securities. This exemption shall not be available for any securities which have been subject

to a bureau stop order pursuant to section 17 of P.L.1967, c. 93 ( C.49:3-64 ), or a bureau order of denial of secondary trading pursuant to subsection (c) of

this section; (iii) Notwithstanding the foregoing, resale transactions by a sponsor of a unit investment

trust registered pursuant to section 8 of the “Investment Company Act of 1940,” 15 U.S.C. s.80a-8 , shall be exempt from registration in this State. (3) Any nonissuer transaction effected by or through a registered broker-dealer pursuant

to an unsolicited order or offer to buy; but the bureau chief may by rule require

that the customer acknowledge upon a form prescribed by the bureau chief that the

sale was unsolicited, and that a signed copy of each such form be preserved by the

broker-dealer for a specified period; (4) Any transaction between the issuer or other person on whose behalf the offering

is made and an underwriter, or among underwriters; (5) Any transaction on a bond or other evidence of indebtedness secured by a real

or chattel mortgage or deed of trust, or by an agreement for the sale of real estate

or chattels, if the entire mortgage, deed of trust, or agreement, together with all

the bonds or other evidences of indebtedness secured thereby, is offered and sold

as a single unit; (6) Any transaction by an executor, administrator, sheriff, marshal, receiver, trustee

in bankruptcy, guardian, or conservator; (7) Any transaction executed by a bona fide pledgee without any purpose of evading

this act; (8) Any offer or sale to a bank, savings institution, trust company, insurance company,

investment company as defined in the “Investment Company Act of 1940,” 2 pension or profit-sharing trust, or other financial institution or institutional

buyer, or to a broker-dealer, whether the purchaser is acting for itself or in some

fiduciary capacity; (9) Any transaction which results in sales to not more than 10 persons (other than

those persons designated in paragraph (8) of subsection (b) of this section in this

State during any period of 12 consecutive months, whether or not the seller or any

of the buyers is then present in this State, if (i) the seller reasonably believes

that all buyers are purchasing for investment, and (ii) no commission or other remuneration

is paid or given directly or indirectly for soliciting any prospective buyer in this

State, and (iii) the securities are not offered or sold by general solicitation or

any general advertisement; but the bureau chief may by rule or order, as to any transaction

or class of transactions, withdraw or further condition this exemption, or increase

or decrease the number of buyers permitted, or waive the conditions in subparagraph

(i), (ii) or (iii) of this paragraph; (10) Any offer or sale of a preorganization certificate or subscription if (i) no

commission or other remuneration is paid or given directly or indirectly for soliciting

any prospective subscriber, (ii) the number of subscribers does not exceed 10, and

(iii) no payment is made by any subscriber; (11) Any transaction pursuant to an offer to existing security holders of the issuer,

including persons who at the time of the transaction are holders of convertible securities,

nontransferable warrants, or transferable warrants exercisable within not more than

90 days of their issuance, if no commission or other remuneration (other than a standby

commission) is paid or given directly or indirectly for soliciting any security holder

in this State; (12) Any transaction by or on behalf of an issuer, or other person, if (i) the seller

has reasonable grounds to believe and, after making reasonable inquiry, believes,

immediately prior to making any sale, that there are no more than 35 purchasers of

the issue in this State during any period of 12 consecutive months and that each purchaser,

who is not an accredited investor, either alone or with his representative has the

knowledge and experience in financial and business matters that he is or they are

capable of evaluating the merits and risks of the prospective investment; (ii) a

written offering statement or prospectus is furnished to each purchaser who is not

an accredited investor containing substantially the same information as is required

by subsection (b) of section 14 of P.L.1967, c. 93 ( C.49:3-61 ) or any applicable form of registration under federal law, and provided that if any

purchaser is furnished with a written offering statement or prospectus, then all purchasers

shall be furnished therewith; (iii) the securities shall not be offered or sold by

general solicitation or any general advertisement; and (iv) a report of the offering

is filed with the bureau not later than 15 days after the first sale of those securities

in this State, setting forth the name and address of the issuer, the total amount

of the securities sold under this paragraph (12), the price at which the securities

were sold, the total number of purchasers of the securities, and the names and addresses

of the purchasers of the securities who reside in this State, indicating the number

and amount of the securities each purchased. Supplemental reports shall be filed promptly after the initial filing with the bureau

whenever there are material changes to the information contained in the initial filing

until the closing of the offering. A final report shall be filed at the closing of the offering if the information

in the final report would be materially different from the last prior filing. The fee for filing the report with the bureau shall be established by regulation

of the bureau chief. The information in the report of sale shall be deemed confidential and shall not

be disclosed to the public except by order of the court or in court proceedings. In calculating the number of purchasers permitted under this paragraph, accredited

investors shall be excluded; (13) The bureau chief, by rule or order, as to a particular transaction or class of

transactions, may adopt a transactional exemption (i) that will further the objectives

of compatibility with the exemptions from securities registration authorized by the

“Securities Act of 1933” and uniformity among the states, or (ii) if the bureau chief

determines that the public interest does not require registration ; (14) Any transaction by or on behalf of an issuer if the following conditions are

met: (i) the issuer is a business entity organized under the laws of this State and authorized

to do business in this State; (ii) the transaction meets the requirements of the federal exemption for intrastate

offerings in section 3(a)(11) of the federal “Securities Act of 1933” ( 15 U.S.C. s.77c(a)(11) ) and Rule 147 adopted under the “Securities Act of 1933” ( 17 C.F.R. s.230.147 ); (iii) the sum of all cash and other consideration to be received for all sales of

the security in reliance on the exemption under this section, excluding sales to any

accredited investor or institutional investor, does not exceed $1,000,000, except

that an offer or sale to an officer, director, partner, trustee, or individual occupying

similar status or performing similar functions with the issuer or to a person owning

10 percent or more of the outstanding securities of the issuer shall not be counted

toward the aggregate monetary limitation of shares to be issued as established herein; (iv) the offering is not a blind pool; (v) the offering by the issuer is made exclusively through an Internet site which

meets with the requirements of section 1 of P.L.2015, c. 128 ( C.49:3-77 ); (vi) the issuer does not accept an investment of more than $5,000 from any single

investor unless the investor is an accredited investor or institutional buyer; (vii) the investor in the securities is a resident of this State; (viii) not less than 10 days prior to the commencement of an offering of the security,

the information required to be posted pursuant to section 1 of P.L.2015, c. 128 ( C.49:3-77 ) is filed with the bureau, in a form to be prescribed by the bureau, with a filing

fee which is to be established by the bureau; and (ix) the issuer has never previously sold securities pursuant to this paragraph. (c) The bureau chief may by order deny or revoke any exemption specified in paragraph

(9), (10) or (11) of subsection (a) of this section or in subsection (b) of this section

with respect to a specific security or transaction. These exemptions may be denied or revoked for the grounds set forth in subsection

(k) of section 9, section 11 and section 17 of P.L.1967, c. 93 ( C.49:3-56 , 49:3-58 or 49:3-64 ). No such order may be entered without appropriate notice to all interested parties,

opportunity for hearing, and written findings of fact and conclusions of law, except

that the bureau chief may by order summarily deny or revoke any of the specified exemptions

pending final determination of any proceeding under this subsection. Upon the entry of a summary order, the bureau chief shall promptly notify all interested

parties that it has been entered and of the reasons therefor. (1) Upon service of notice of the order issued by the bureau chief, the respondent

shall have up to 15 days to respond to the bureau in the form of a written answer

and written request for a hearing. The bureau chief shall, within five days of receiving the answer and a request for

a hearing, either transmit the matter to the Office of Administrative Law for a hearing

or schedule a hearing at the bureau. Orders issued pursuant to this subsection (c) shall be subject to an application

to vacate upon 10 days' notice, and a preliminary hearing on the order shall be held

in any event within 20 days after it is requested; and the filing of a motion to

vacate the order shall toll the time for filing an answer and written request for

a hearing. (2) If a respondent fails to respond by either filing a written answer and written

request for a hearing with the bureau or moving to vacate an order within the 15-day

prescribed period, the respondent shall be deemed to have waived the opportunity to

be heard. The order will remain in effect until it is modified or vacated upon notice to all

interested parties by the bureau chief. No order under this subsection may operate retroactively. (d) In any proceeding under this act, the burden of proving an exemption or an exception

from a definition is upon the person claiming it. 1

15 U.S.C.A. § 79 et seq. 2

15 U.S.C.A. § 80a-1 et seq.