Amendment clarifies the disqualification from the exemption of any broker or associated person who is subject to suspension or revocation of registration, and the inapplicability of the exemption to any M&A transaction where one party or more is a shell company.

1. 1

   Change 1: Inserts new text on page 9, line 16

   InsertsPrinted page

   Inserted: (iii) Engages on behalf of any party in a transaction involving a public shell company.

   Inserted: (C) Disqualifications.--An M&A broker is not exempt from registration under this paragraph if such broker is subject to--

   Inserted: (i) suspension or revocation of registration under paragraph (4);

   Inserted: (ii) a statutory disqualification described in section 3(a)(39);

   Inserted: (iii) a disqualification under the rules adopted by the Commission under section 926 of the Investor Protection and Securities Reform Act of 2010 (15 U.S.C. 77d note); or

   Inserted: (iv) a final order described in paragraph (4)(H).

   Original wording

   Page 9, after line 16, insert the following:

2. 2

   Change 2: Replaces “(C)” with “(D)”

   ReplacesPage 9, line 17Printed page

   [struck: (C)][inserted: (D)]

   Original wording

   Page 9, line 17, strike “(C)” and insert “(D)”.

3. 3

   Change 3: Replaces “(D)” with “(E)”

   ReplacesPage 9, line 23Printed page

   [struck: (D)][inserted: (E)]

   Original wording

   Page 9, line 23, strike “(D)” and insert “(E)”.

4. 4

   Change 4: Inserts “privately held” after “means a”

   InsertsPage 10, line 23Printed page

   …means a[inserted: privately held]…

   Original wording

   Page 10, line 23, insert “privately held” after “means a”.

5. 5

   Change 5: Replaces “year-end balance sheet” through “report of the independent auditor” with “fiscal year-end financial statements of the issuer of the securities as customarily prepa…”

   ReplacesPage 13, line 6Printed page

   [struck: year-end balance sheet … report of the independent auditor][inserted: fiscal year-end financial statements of the issuer of the securities as customarily prepared by the management of the issuer in the normal course of operations and, if the financial statements of the issuer are audited, reviewed, or compiled, any related statement by the independent accountant]

   Original wording

   Page 13, beginning on line 6, strike “year-end balance sheet” and all that follows through “report of the independent auditor” and insert “fiscal year-end financial statements of the issuer of the securities as customarily prepared by the management of the issuer in the normal course of operations and, if the financial statements of the issuer are audited, reviewed, or compiled, any related statement by the independent accountant”.

6. 6

   Change 6: Inserts new text on page 13, line 20

   InsertsPrinted page

   Inserted: (iv) Public shell company.--The term 'public shell company' is a company that at the time of a transaction with an eligible privately held company--

   Inserted: (I) has any class of securities registered, or required to be registered, with the Commission under section 12 or that is required to file reports pursuant to subsection (d);

   Inserted: (II) has no or nominal operations; and

   Inserted: (III) has--

   Inserted: (aa) no or nominal assets;

   Inserted: (bb) assets consisting solely of cash and cash equivalents; or

   Inserted: (cc) assets consisting of any amount of cash and cash equivalents and nominal other assets.

   Original wording

   Page 13, after line 20, insert the following:

7. 7

   Change 7: Replaces “(E)” with “(F)”

   ReplacesPage 13, line 21Printed page

   [struck: (E)][inserted: (F)]

   Original wording

   Page 13, line 21, strike “(E)” and insert “(F)”.

8. 8

   Change 8: Replaces “subparagraph (D)(ii)(II)” with “subparagraph (E)(ii)(II)”

   ReplacesPage 14, line 2Printed page

   [struck: subparagraph (D)(ii)(II)][inserted: subparagraph (E)(ii)(II)]

   Original wording

   Page 14, beginning on line 2, strike “subparagraph (D)(ii)(II)” and insert “subparagraph (E)(ii)(II)”.

Read automatically from the Congressional Record. Check the original before relying on it.

As printed