N.D. Cent. Code § 10-04-06

10-04-06. Exempt transactions

Except as hereinafter in this section expressly provided, sections 10-04-04, 10-04-07.1,

10-04-07.2, 10-04-08, 10-04-08.4, and 10-04-10 do not apply to any of the following

transactions:

1. A transaction by an executor, administrator of an estate, sheriff, marshal, receiver,

guardian, conservator, or trustee in bankruptcy.

2. The sale, in good faith and not for the purpose of avoiding the provisions of this

chapter, by a pledgee of securities pledged for a bona fide debt.

3. An isolated sale of any security made by or on behalf of a bona fide owner for the

owner's account, such owner not being an issuer, underwriter, broker-dealer, or agent

and such sale not being made in the course of repeated and successive transactions

of a like character. This subsection shall not exempt any broker-dealer or agent

participating in an isolated sale from registering in accordance with section 10-04-10.

4. A transaction by an issuer for:

a. Securities dividends or other distributions by a corporation, cooperative, limited

partnership, limited liability limited partnership, or limited liability company out of

its earnings or surplus; or

b. The sale or distribution of additional capital stock of a corporation or cooperative,

interest of a partnership, or membership interest of a limited liability company to

or among its own stockholders, partners, or members.

5. A sale or offer to sell to:

a. An institutional investor;

b. A federal covered investment adviser; or

c. Any other person exempted by rule adopted or order issued by the commissioner.

6. Any transaction incident to a vote by stockholders, partners, or members pursuant to

the articles of incorporation, bylaws, partnership agreement, articles of organization,

member-control agreement, or the applicable corporation, partnership, or limited

liability company statute on a merger, consolidation, exchange of securities, or sale of

corporate, partnership, or limited liability company assets in consideration of the

issuance of securities of another corporation, partnership, or limited liability company,

other reorganization to which the issuer, or its parent or subsidiary and the other

person or its parent or subsidiary, are parties, or any transaction incident to a judicially

approved reorganization in which a security is issued in exchange for one or more

outstanding securities, claims, or property interests, or partly in such exchange and

partly for cash, or the solicitation of tenders of securities by an offeror in a tender offer

in compliance with rule 162 adopted under the Securities Act of 1933.

7. A transaction under an offer to existing securityholders of the issuer, including persons

that at the date of the transaction are holders of convertible securities, options, or

warrants, if a commission or other remuneration, other than a standby commission, is

not paid or given, directly or indirectly, for soliciting a securityholder in this state.

8. A nonissuer transaction by or through a broker-dealer and agent, both of which are

registered or exempt from registration under this chapter, or a resale transaction by a

sponsor of a unit investment trust registered under the Investment Company Act of

1940, in a security of a class that has been outstanding in the hands of the public for at

least ninety days, if, at the date of the transaction:

a. The issuer of the security is engaged in business, the issuer is not in the

organizational stage or in bankruptcy or receivership, and the issuer is not a

blank check, blind pool, or shell company that has no specific business plan or

purpose or has indicated that its primary business plan is to engage in a merger

or combination of the business with, or an acquisition of, an unidentified person;

b. Such securities are sold at prices reasonably related to the current market price;

c. Such securities do not constitute the whole or part of an unsold allotment to, or
pool, or shell company that has no specific business plan or

purpose or has indicated that its primary business plan is to engage in a merger

or combination of the business with, or an acquisition of, an unidentified person;

b. Such securities are sold at prices reasonably related to the current market price;

c. Such securities do not constitute the whole or part of an unsold allotment to, or

subscription or participation by, the broker-dealer as an underwriter of the security

or a redistribution;

d. Such securities are listed in Mergent's Industrial Manual, Mergent's Bank and

Finance Manual, Mergent's Transportation Manual, Mergent's Public Utility

Manual, or Fitch investor service, incorporated, are on the OTCQX or OTCQB

markets operated by OTC Markets Group Incorporated, or are filed under

section 13 or 15(d) of the Securities Exchange Act of 1934 [ch. 404, title I, sec. 1;

48 Stat. 881; 15 U.S.C. 78 et seq.]; and

e. Any one of the following requirements is met:

(1) The issuer of the security has a class of equity securities listed on a national

securities exchange registered under section 6 of the Securities Exchange

Act of 1934 or designated for trading on the national association of

securities dealers automated quotation system;

(2) The issuer of the security is a unit investment trust registered under the

Investment Company Act of 1940;

(3) The issuer of the security, including its predecessors, has been engaged in

continuous business for at least three years; or

(4) The issuer of the security has total assets of at least two million dollars

based on an audited balance sheet as of a date within eighteen months

before the date of the transaction or, in the case of a reorganization or

merger when the parties to the reorganization or merger each had the

audited balance sheet, a pro forma balance sheet for the combined

organization.

9. a. Any transaction pursuant to an offer directed by the offeror to not more than

thirty-five persons, other than those designated in subsection 5, in this state

during any period of twelve consecutive months, whether or not the offeror or any

of the offerees is then present in this state, if all of the following conditions are

met:

(1) The seller reasonably believes that all the buyers in this state, other than

those designated in subsection 5, are purchasing for investment.

(2) Except for offers or sales with respect to persons designated in

subsection 5, no security may be offered or sold under this subdivision

except through or by a broker-dealer and agent registered in accordance

with section 10-04-10, unless it is offered and sold through an officer,

director, governor, or partner of the issuer and no commission or other

remuneration is paid, either directly or indirectly.

(3) The offeror applies for and obtains the written approval of the commissioner

prior to making any offers in this state and pays a nonrefundable filing fee of

one hundred fifty dollars, which fee must accompany the application for

approval.

The commissioner may, as to any security or transaction or any type of security

or transaction, withdraw or further condition this exemption, or increase or

decrease the number of offerees permitted, or waive the condition in paragraph 1.

b. Any offer or sale in this state of common stock, preferred stock, limited liability

company membership interests, or limited partnership interests of an issuer

during any period of twelve consecutive months if all of the following conditions

are met:

(1) The issuer reasonably believes that all the buyers in this state, other than

those designated in subsection 5, are purchasing for investment.
ny offer or sale in this state of common stock, preferred stock, limited liability

company membership interests, or limited partnership interests of an issuer

during any period of twelve consecutive months if all of the following conditions

are met:

(1) The issuer reasonably believes that all the buyers in this state, other than

those designated in subsection 5, are purchasing for investment.

(2) Except with respect to offers and sales made to persons designated in

subsection 5, no security may be sold under this subdivision except through

or by a broker-dealer and agent registered in accordance with section

10-04-10, unless it is offered and sold through an officer, director, governor,

or partner of the issuer and no commission or other remuneration is paid,

either directly or indirectly.

(3) The issuer is both organized under the laws of this state and has its

principal place of business in this state.

(4) No public advertising matter or general solicitation, except tombstone

advertisements approved by the commissioner, is used in connection with

any offers or sales.

(5) An offering disclosure document in the form approved by the commissioner

must be delivered to each offeree prior to the sale of the security.

(6) The gross proceeds of the offering may not exceed five million dollars.

(7) The issuer must apply for and obtain the written approval of the

commissioner prior to making any offer or sale in this state by filing an

application prescribed by the commissioner, a copy of the offering disclosure

document, and any other information or documents the commissioner may

require, together with a nonrefundable filing fee of one hundred fifty dollars.

(8) All funds raised in the offering are placed in an escrow account until the total

offering amount has been sold.

The commissioner may withdraw or further condition this exemption or waive the

conditions in paragraphs 5 and 6.

c. The issuer must file a report of all offers and sales made in this state pursuant to

subdivision a or b on a form prescribed by the commissioner within thirty days

after the completion of the offering or expiration of the twelve-month approval

period, whichever occurs first.

d. The exemptions provided under subdivisions a and b may not be combined.

e. An exemption under this subsection is not available for the securities of any

issuer if the issuer or any promoter, officer, director, manager, partner, or

underwriter of the issuer:

(1) Has filed a registration statement that is the subject of a currently effective

registration stop order entered pursuant to any federal or state securities law

within five years prior to the filing of the application required under this

exemption.

(2) Has been convicted within five years prior to the filing of the application

required under this exemption of any felony or misdemeanor in connection

with the offer, purchase, or sale of any security or any felony involving fraud

or deceit, including forgery, embezzlement, obtaining money under false

pretenses, larceny, or conspiracy to defraud.

(3) Is currently subject to any state administrative enforcement order or

judgment entered by any state securities administrator or the securities and

exchange commission within five years prior to the filing of the application

required under this exemption or is subject to any federal or state

administrative enforcement order or judgment in which fraud or deceit,

including making untrue statements of material facts, was found and the

order of judgment was entered within five years prior to the filing of the

application required under this exemption.

(4) Is subject to any federal or state administrative enforcement order or

judgment which prohibits, denies, or revokes the use of any exemption from

registration in connection with the offer, purchase, or sale of securities.
rue statements of material facts, was found and the

order of judgment was entered within five years prior to the filing of the

application required under this exemption.

(4) Is subject to any federal or state administrative enforcement order or

judgment which prohibits, denies, or revokes the use of any exemption from

registration in connection with the offer, purchase, or sale of securities.

(5) Is currently subject to any order, judgment, or decree of any court of

competent jurisdiction temporarily or preliminarily restraining or enjoining, or

is subject to any order, judgment, or decree of any court of competent

jurisdiction, permanently restraining or enjoining, such part from engaging in

or continuing any conduct or practice in connection with the purchase or

sale of a security or involving the making of any false filing with any state or

with the securities and exchange commission entered within five years prior

to the filing of the application required under this exemption.

(6) Has been or is the subject of any order issued by the United States postal

service that was entered within five years prior to reliance on this exemption

and alleged any fraudulent or unlawful conduct.

f. Subdivision e does not apply if the commissioner determines, upon a showing of

good cause, that it is not necessary under the circumstances that the exemption

should not be denied.

10. The sale of capital stock of a corporation or membership interests of a limited liability

company if the corporation or limited liability company is organized under the statutes

of this state or the sale of memberships, including dues, in a nonprofit corporation

incorporated in North Dakota if the corporation or limited liability company is organized

and operated for the primary purpose of promoting community development.

11. Any security issued in connection with an employees' stock purchase, savings, option,

profit-sharing, pension, or similar employees' benefit plan, including any securities,

plan interests, and guarantees issued under a compensatory benefit plan or

compensation contract, contained in a record, established by the issuer, its parents, its

majority-owned subsidiaries, or the majority-owned subsidiaries of the issuer's parent

for the participation of their employees, including offers or sales of such securities to:

a. Directors; general partners; trustees, if the issuer is a business trust; officers;

consultants; and advisers;

b. Family members who acquire such securities from those persons through gifts or

domestic relations orders;

c. Former employees, directors, general partners, trustees, officers, consultants,

and advisers if those individuals were employed by or providing services to the

issuer when the securities were offered; and

d. Insurance agents who are exclusive insurance agents of the issuer, or the

issuer's subsidiaries or parents, or who derive more than fifty percent of their

annual income from those organizations.

12. The sale of a security issued by the United States, or the state of North Dakota, or any

political subdivision or instrumentality of the state of North Dakota; provided, that the

offer for sale and sale are made by an official or employee of the issuer or of the Bank

of North Dakota acting in an official capacity and not for personal pecuniary profit, or

by a bank or similar financial association or institution or an official or employee thereof

solely as an accommodation to customers of such association or institution and

without asking or receiving a commission or remuneration other than an

accommodation fee not to exceed one hundred dollars in connection with the

transaction.

13. Any offer or sale of shares of capital stock issued by a professional corporation,

professional limited liability company, or professional limited liability partnership which

is organized and operated pursuant to chapter 10-31.
and

without asking or receiving a commission or remuneration other than an

accommodation fee not to exceed one hundred dollars in connection with the

transaction.

13. Any offer or sale of shares of capital stock issued by a professional corporation,

professional limited liability company, or professional limited liability partnership which

is organized and operated pursuant to chapter 10-31.

14. The offer or sale of a security issued by North Dakota united dues credit trust to

members of North Dakota united.

15. a. An offer, but not a sale, of a security made by or on behalf of an issuer for the

sole purpose of soliciting an indication of interest in receiving a prospectus or

similar disclosure document for the security if all of the following conditions are

satisfied:

(1) The issuer is or will be a business entity organized under the laws of one of

the states or possessions of the United States or one of the provinces or

territories of Canada; is engaged in or proposes to engage in a business

other than petroleum exploration or production, mining, or other extractive

industries; and is not a blind pool offering or other offering for which the

specific business or properties cannot now be described.

(2) The issuer may solicit indications of interest in a project or business only

within a period of twelve months after receiving approval from the

commissioner and does not pay a commission or fee to any person for

soliciting a potential investor or prospective purchaser in this state unless

the person who receives the commission or fee is registered as a

broker-dealer or agent in this state.

(3) The issuer intends to register securities in this state, rely upon subsection 8

of section 10-04-05 for the issuance of a security, or receive approval for an

exemption under subsection 5 of section 10-04-05 or subsection 9 of this

section.

(4) The issuer files a solicitation of interest form and copies of any advertising

or marketing materials, including scripts for use in telephone, television,

electronic, or computer publications, for approval by the commissioner at

least ten business days before the issuer begins soliciting indications of

interest from potential purchasers and at least ten business days before

publishing or distributing any materials or information to any person.

(5) The issuer obtains approval of the commissioner for any amendments or

changes in filed forms, marketing materials, or advertisements at least ten

business days before distributing the amended marketing materials or

amended advertising information to any person.

(6) The issuer does not use any solicitation of interest form, script,

advertisement, or other material which the issuer has been notified by the

commissioner not to distribute, to solicit indications of interest.

(7) Except for scripted broadcasts and published notices, the issuer does not

communicate with any offeree about the contemplated offering unless the

offeree is provided with the most current solicitation of interest form at or

before the time of the communication or within five days from the

communication.

(8) The issuer stops all communications with prospective investors made in

reliance on this exemption immediately after filing an application to register

or qualify the securities with the commissioner or with the securities and

exchange commission.

(9) The issuer does not accept money or sign completed contracts for sales of

securities with any person while soliciting indications of interest and does

not complete any sales of securities until at least ten business days after

completing a securities registration or approval to offer and sell securities in

this state.

(10) The issuer does not make a sale until three days after delivery to the

purchaser of a prospectus or similar disclosure document.
s for sales of

securities with any person while soliciting indications of interest and does

not complete any sales of securities until at least ten business days after

completing a securities registration or approval to offer and sell securities in

this state.

(10) The issuer does not make a sale until three days after delivery to the

purchaser of a prospectus or similar disclosure document.

(11) The issuer does not know, and in the exercise of reasonable care could not

know, that the issuer or any officer, director, manager, ten percent

shareholder, promoter, partner, or agent of the issuer:

(a) Has been the subject of or filed a registration statement that is the

subject of a stop order, administrative enforcement order, judgment,

injunction, or restraining order issued by any federal or state securities

agency, any court of competent jurisdiction, or the United States

postal service and which prohibits, denies, or revokes the registration

or use of any exemption from registration in connection with the offer,

sale, or purchase of a security, franchise, commodity, or other financial

transaction or which involves fraud, deceit, misstatements of material

facts, forgery, embezzlement, obtaining money under false pretenses,

larceny, conspiracy to defraud, or similar deceptive acts within five

years prior to the filing of the solicitation of interest form; or

(b) Has been convicted of any felony or misdemeanor involving the offer,

purchase, or sale of a security, franchise, commodity, or financial

transaction, or any felony or misdemeanor involving fraud, deceit,

forgery, embezzlement, conspiracy to defraud, or a similar financial

crime.

The prohibitions listed above shall not apply if the person subject to the

disqualification is duly licensed or registered to conduct securities-related

business in the state in which the administrative order or judgment was

entered against such person or if the broker-dealer employing such party is

licensed or registered in this state and the form B-D filed with this state

discloses the order, conviction, judgment, or decree relating to such person.

A person disqualified under this subsection may not act in a capacity other

than that for which the person is licensed or registered. Any disqualification

caused by this section is automatically waived if the agency, which created

the basis for disqualification, determines upon a showing of good cause that

it is not necessary under the circumstances that the exemption be denied.

b. The issuer shall comply with the requirements set forth below. Failure to comply

will not result in the loss of the exemption from the requirements of section

10-04-04, but is a violation of this chapter, is actionable by the commissioner

under section 10-04-16, and constitutes grounds for denying or revoking the

exemption as to a specific security or transaction.

(1) Any published notice must contain at least the identity of the chief executive

officer of the issuer, a brief and general description of its business and

products, and the following legends:

(a) NO MONEY OR OTHER CONSIDERATION IS BEING SOLICITED

AND NONE WILL BE ACCEPTED;

(b) NO SALES OF THE SECURITIES WILL BE MADE OR

COMMITMENT TO PURCHASE ACCEPTED UNTIL DELIVERY OF A

PROSPECTUS OR SIMILAR DISCLOSURE DOCUMENT THAT

INCLUDES COMPLETE INFORMATION ABOUT THE ISSUER AND

THE OFFERING;

(c) AN INDICATION OF INTEREST MADE BY A PROSPECTIVE

INVESTOR INVOLVES NO OBLIGATION OR COMMITMENT OF

ANY KIND; and
OTHER CONSIDERATION IS BEING SOLICITED

AND NONE WILL BE ACCEPTED;

(b) NO SALES OF THE SECURITIES WILL BE MADE OR

COMMITMENT TO PURCHASE ACCEPTED UNTIL DELIVERY OF A

PROSPECTUS OR SIMILAR DISCLOSURE DOCUMENT THAT

INCLUDES COMPLETE INFORMATION ABOUT THE ISSUER AND

THE OFFERING;

(c) AN INDICATION OF INTEREST MADE BY A PROSPECTIVE

INVESTOR INVOLVES NO OBLIGATION OR COMMITMENT OF

ANY KIND; and

(d) THIS OFFER IS BEING MADE PURSUANT TO AN EXEMPTION

FROM REGISTRATION UNDER THE FEDERAL AND STATE

SECURITIES LAWS. NO SALE MAY BE MADE UNTIL THE

OFFERING STATEMENT IS QUALIFIED BY THE SECURITIES AND

EXCHANGE COMMISSION AND IS REGISTERED OR APPROVED

IN THIS STATE.

(2) Any script for broadcast must contain at least the identity of the chief

executive of the issuer, a brief description of its business and products, its

address and telephone number, and the following legends:

(a) THIS IS FOR AN INDICATION OF INTEREST ONLY AND INVOLVES

NO OBLIGATION OR COMMITMENT OF ANY KIND UPON A

PROSPECTIVE INVESTOR;

(b) NO MONEY OR OTHER CONSIDERATION IS BEING SOLICITED;

and

(c) THIS OFFER IS MADE PURSUANT TO AN EXEMPTION FROM

REGISTRATION UNDER FEDERAL AND STATE SECURITIES

LAWS.

c. Offers made on reliance of this exemption will not result in a violation of section

10-04-04 by virtue of being integrated with subsequent offers or sales of

securities unless such subsequent offers and sales would be integrated under

federal securities laws.

16. An offer or sale of common stock, limited liability company membership interests, or

limited partnership interests by a person to a person or other subscribers, not

exceeding ten in number, for the sole purpose of organization in this state, if the

securities are not acquired for the purpose of resale to others for a period of twelve

months, advertising has not been published or circulated in connection with the offer or

sale, and all sales are consummated within ten days after the date of organization.

17. Any offer or sale of a security by an issuer in a transaction provided all of the following

conditions are met:

a. Sales of securities may be made only to persons who are, or the issuer

reasonably believes are, accredited investors as defined in 17 CFR 230.501(a)

promulgated by the securities and exchange commission.

b. The exemption is not available to an issuer that is in the development stage that

either has no specific business plan or purpose or has indicated that its business

plan is to engage in a merger or acquisition with an unidentified company or

companies, or other entity or person.

c. The issuer reasonably believes that all purchasers are purchasing for investment

and not with the view to, or for, sale in connection with a distribution of the

security. Any resale of a security sold in reliance of this exemption within twelve

months of sale must be presumed to be with a view to distribution and not for

investment, except a resale pursuant to a registration statement effective under

section 10-04-04 or to an accredited investor pursuant to an exemption available

under subsection 5.

d. (1) The exemption is not available to an issuer if the issuer, any of the issuer's

predecessors, any affiliated issuer, any of the issuer's directors, officers,

general partners, beneficial owners of ten percent or more of any class of its

equity securities, any of the issuer's promoters presently connected with the

issuer in any capacity, any underwriter of the securities to be offered, or any

partner, director, or officer of such underwriter:

(a) Within the last five years, has filed a registration statement that is the

subject of a currently effective registration stop order entered by any

state securities administrator or the securities and exchange

commission;

(b) Within the last five years, has been convicted of any criminal offense

in connection with the offer, purchase, or sale of any security, or

involving fraud or deceit;
(a) Within the last five years, has filed a registration statement that is the

subject of a currently effective registration stop order entered by any

state securities administrator or the securities and exchange

commission;

(b) Within the last five years, has been convicted of any criminal offense

in connection with the offer, purchase, or sale of any security, or

involving fraud or deceit;

(c) Is currently subject to any state or federal administrative enforcement

order or judgment, entered within the last five years, finding fraud or

deceit in connection with the purchase or sale of any security; or

(d) Is currently subject to any order, judgment, or decree of any court of

competent jurisdiction, entered within the last five years, temporarily,

preliminarily, or permanently restraining or enjoining such party from

engaging in or continuing to engage in any conduct or practice

involving fraud or deceit in connection with the purchase or sale of any

security.

(2) Paragraph 1 does not apply if:

(a) The party subject to the disqualification is licensed or registered to

conduct securities-related business in the state in which the order,

judgment, or decree creating the disqualification was entered against

such party;

(b) Before the first offer under this exemption, the state securities

administrator, or the court or regulatory authority that entered the

order, judgment, or decree, waives the disqualification; or

(c) The issuer establishes that it did not know and in the exercise of

reasonable care, based on a factual inquiry, could not have known

that a disqualification existed under this subdivision.

e. (1) A general announcement of the proposed offering may be made by any

means.

(2) The general announcement must include only the following information,

unless additional information is specifically permitted by the commissioner:

(a) The name, address, and telephone number of the issuer of the

securities;

(b) The name, a brief description, and price, if known, of any security to

be issued;

(c) A brief description of the business of the issuer in twenty-five words or

less;

(d) The type, number, and aggregate amount of securities being offered;

(e) The name, address, and telephone number of the person to contact

for additional information; and

(f) A statement that:

[1] Sales will only be made to accredited investors;

[2] No money or other consideration is being solicited or will be

accepted by way of this general announcement; and

[3] The securities have not been registered with or approved by any

state securities agency or the securities and exchange

commission and are being offered and sold pursuant to an

exemption from registration.

f. The issuer, in connection with an offer, may provide information in addition to the

general announcement under subdivision e, if such information:

(1) Is delivered through an electronic database that is restricted to persons who

have been prequalified as accredited investors; or
e securities and exchange

commission and are being offered and sold pursuant to an

exemption from registration.

f. The issuer, in connection with an offer, may provide information in addition to the

general announcement under subdivision e, if such information:

(1) Is delivered through an electronic database that is restricted to persons who

have been prequalified as accredited investors; or

(2) Is delivered after the issuer reasonably believes that the prospective

purchaser is an accredited investor.

g. Telephone solicitation is not permitted unless prior to placing the call, the issuer

reasonably believes that the prospective purchaser to be solicited is an

accredited investor.

h. Dissemination of the general announcement of the proposed offering to persons

who are not accredited investors does not disqualify the issuer from claiming the

exemption.

i. The issuer shall file with the department a notice of transaction, a consent to

service of process, a copy of the general announcement, and a nonrefundable

filing fee of one hundred dollars within fifteen days after the first sale in this state.

In the event the filing is not made within fifteen days after the first sale in this

state, the filing fee is two hundred fifty dollars.

j. The security offered or sold under this subsection is offered or sold by a

broker-dealer and agent registered in accordance with section 10-04-10, or

offered and sold through an officer, director, governor, or partner of the issuer and

no commission or other remuneration is paid.

18. The offer or sale of a security issued by an organization organized under and operated

in compliance with chapter 10-06.1.

19. Any offer or sale of an agricultural-related cooperative security by or on behalf of an

agricultural producer, as defined by section 32-44-01, to a person for the purpose of

producing and selling agricultural products, as defined by section 32-44-01, to the

cooperative. Commissions or other remuneration may not be paid or given directly or

indirectly for soliciting any prospective buyer in this state, except to a broker-dealer or

agent registered in this state, to an agent of a bank or a commercial trust department,

to a licensed real estate agent, or to a licensed auctioneer if the sale is made at a

bona fide public auction.

20. A transaction in a note, bond, debenture, or other evidence of indebtedness secured

by a mortgage or other security agreement if:

a. The note, bond, debenture, or other evidence of indebtedness is offered and sold

with the mortgage or other security agreement as a unit;

b. A general solicitation or general advertisement of the transaction is not made; and

c. A commission or other remuneration is not paid or given, directly or indirectly, to a

person not registered under this chapter as a broker-dealer or as an agent.

21. A nonissuer transaction by a federal covered investment adviser with investments

under management in excess of one hundred million dollars acting in the exercise of

discretionary authority in a signed record for the account of others.