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of an unissued security to cases where such security is a right or the subject of a right to subscribe or otherwise acquire such security granted to holders of a previously registered security and where the primary purpose of such registration is to distribute such unissued security to such holders.

(e) Notwithstanding the foregoing provisions of this section, the Commission may by such rules and regulations as it deems necessary or appropriate in the public interest or for the protection of investors permit securities listed on any exchange at the time the registration of such exchange as a national securities exchange becomes effective, to be registered for a period ending not later than July 1, 1935, without complying with the provisions of this section.

(f) The Commission is directed to make a study of trading in unlisted securities upon exchanges and to report the results of its study and its recommendations to Congress on or before January 8, 1936. Notwithstanding the foregoing provisions of this section, the Commission may, by such rules and regulations as it deems necessary or appropriate for the protection of investors, prescribe terms and conditions under which, upon the application of any national securities exchange, such exchange (1) may continue until June 1, 1936, unlisted trading privileges to which a security had been admitted on such exchange prior to March 1, 1934, and for such purpose exempt such security and thọ issuer thereof from the provisions of this section and sections 13 and 16, or (2) may extend until July 1, 1935, unlisted trading privilege to any security registered on any other national securities exchange which security was listed on such other exchange on March 1, 1934. A security for which unlisted trading privileges are so continued shall be considered a "security registered on a national securities exchange” within the meaning of this title. The rules and regulations of the Commission relating to such unlisted trading privileges for securities shall require that quotations of transactions upon any national securities exchange shall clearly indicate the difference between fully listed securities and securities admitted to unlisted trading privileges only.

PERIODICAL AND OTHER REPORTS

Seo. 13. (a) Every issuer of a security registered on a national securities exchange shall file the information, documents, and reports below specified with the exchange (and shall file with the Commission such duplicate originals thereof as the Commission may require), in accordance with such rules and regulations as the Commission may prescribe as necessary or appropriate for the proper protection of investors and to insure fair dealing in the security

(1) Such information and documents as the Commission may require to keep reasonably current the information and documents filed pursuant to section 12.

(2) Such annual reports, certified if required by the rules and regulations of the Commission by independent public accountants, and such quarterly reports, as the Commission may prescribe.

(b) The Commission may prescribe, in regard to reports made pursuant to this title, the form or forms in which the required information shall be set forth, the items or details to be shown in the

Baction

11, 53

12

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8. Taking Effect of Registration Statements and Amendments thereto.. 7

Effective date of statements..

7, 272

Refusal orders.--

Effective date of post-effective amendments.

(d) Stop order and basis for issuance..

le) Examinations to determine whether stop order should issue

under subsection (d).

(1) Notices..

9. Court Review of Orders.--.

(a) Persons entitled to obtain review.

(b) Effect of proceedings under subsection (a).

10. Information Required in Prospectus...

(a) Similarity to registration statement...

(b) When necessary to revise prospectus..

9, 53

Manner of presentation of information..

9

(d) Prospectus consisting of radio broadcast..

9

11. Civil Liabilities on Account of False Registration Statement.

(a) Persons against whom suits may be brought....

9, 53

(b) Burden of proof...

10, 53

Reasonable investigation and reasonable ground for belief...

(d) Liability of underwriter becoming such after registration..

11

(e) Nature of suit...

11, 54

(f) Joint and several liability

11

(g) Amount recoverable.

12. Civil Liabilities Arising in Connection with Prospectus and Communi-

cations...

12

13. Limitation of Actions..

12, 15

14. Contrary Stipulations Void..

12

15. Liability of Controlling Persons...

12, 54

16. Additional Remedies..

13

17. Fraudulent Interstate Transactions..

13

18. State Control of Securities--

13

19. Special Powers of Commission..

13

(a) Rules, regulations and forms.

(b) Subpena power..

14

20. Injunctions and Prosecution of Offenses.

14

(a) Filing statement-investigations..

14

(b) Injunctions-criminal proceedings..

14

(c) Mandamus writs.--

14

21. Hearings by Commission.-

15

22. Jurisdiction of Offenses and Suits..

15

(a) Courts having jurisdiction.---

15

(h) Contumacy or refusal to obey subpena.

15

(c) Privilege against self-incrimination..

15

23. Unlawful Representations.-

15

24. Penalties...

16

25. Jurisdiction of Other Government Agencies Over Securities.

16

26. Separability of Provisions..

16

13, 55

Relating to security issues other than those of a foreign government

or political subdivision thereof....

16

Securities of a borrowing government or subdivision thereof.----

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23

Section

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206. Annual Reports of Corporation...

24

207. Discretionary Levy of Charges.

24

208. Receipt of Subscriptions..

24

209. Reconstruction Finance Corporation Loan..

24

210. Prohibitions Against Interference With Department of State or U. 8.

Government

24

211. Effective Date--------------

24

212. Short Title....

24

Publlo, No. 291–73d Cong.–Securities Exchange Act of 1934, Approved Juno

6, 1934

To provide for the regulation of securities exchanges and of over-the-counter markets operating in Interstate

and foreign commerce and through the malls, to prevent inequitable and unfair practices on such exchanges

and markets, and for other purposes.

TITLE I. REGULATION OF SBOURITIDS EXCHANGES

Section

1. Short Title..

26

2. Necessity for Regulation as Provided in this Title..

25

Reasons for National Public Interest...

25

Use of mails and interstate commerce..

25

Effect of prices on certain taxes owing to the United States

and the States and on the value of collateral loans...

26

(3) Effect of prices on expansion, appraisal and national banking

system..

26

(4) Affect on the general welfare and national credit.

8. Definitions and Application of Title---

(a) Definitions:

Exchange

26

(2) Facility-

26

(3) Member.

26

(4) Broker.

26

(6) Dealer...

27

(6) Bank.

Director..

(8) Issuer.

27

(9) Person.

27

(10) Security -

27

(11) Equity Security,

27

(12) Exempted Security or Exempted Securities.

28

(13) Buy and Purchase...

28

(14) Sale and Sell.....

28

(15) Commission..

28

(16) State.

28

(17) Interstate commerce.

28

Commission and Federal Reserve Board Powers...

28

Applicability of Act to Governmental Departments and

Agencies.

28

4. Securities and Exchange Commission....

29

(a) Establishment of Commission membership, restriotion on

activities, compensation and term of office

29

(b) Appointment and compensation of certain employees.-

29

3. Transactions on Unregistered Exchanges..,

29

Restriction against use of mails or channels

of interstate commerce la

transactions on unregistered or nonexempted exchanges...

29

6. Registration of National Securities Exchanges..

29

(a) Registration statement of exchange....

29

(1) Agreement of exchange..

80

(2) Organization data, rules and membership...

80

Copies of rules of the exchange.-

80

Agreement to furnish copy of amendments to rules of the

exchange.

80

(b) Requirement that rules of the exchange provide for expulsion,

suspension, or discipline ----

80

(c) Adoption of rules of exchange which are not inconsistent with

Act or State law...

80

market for any such security, (A) to effect any transaction in such security which involves no change in the beneficial ownership thereof, or (B) to enter an order or orders for the purchase of such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the sale of any such security, has been or will be entered by or for the same or different parties, or. (C) to enter any order or orders for the sale of any such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the purchase of such security, has been or will be entered by or for the same or different parties.

(2) To effect, alone or with one or more other persons, a series of transactions in any security registered on a national securities exchange creating actual or apparent active trading in such security or raising or depressing the price of such security, for the purpose of inducing the purchase or sale of such security by others.

(3) If a dealer or broker, or other person selling or offering for sale or purchasing or offering to purchase the security, to induce the purchase or sale of any security registered on a national securities exchange by the circulation or dissemination in the ordinary course of business of information to the effect that the price of any such security will or is likely to rise or fall because of market operations of any one or more persons conducted for the purpose of raising or depressing the prices of such security.

(4) If a dealer or broker, or other person selling or offering for sale or purchasing or offering to purchase the security, to make, regarding any security registered on a national securities exchange, for the purpose of inducing the purchase or sale of such security, any statement which was at the time and in the light of the circumstances under which it was made, false or misleading with respect to any material fact, and which he knew or had reasonable ground to believe was so false or misleading:

(5) For a consideration, received directly or indirectly from a dealer or broker, or other person selling or offering for sale or purchasing or offering to purchase the security, to induce the purchase or sale of any security registered on a national securities exchange by the circulation or dissemination of information to the effect that the price of any such security will or is likely to rise or fall because of the market operations of any one or more persons conducted for the purpose of raising or depressing the price of such security.

(6) To effect either alone or with one or more other persons any series of transactions for the purchase and/or sale of any security registered on a national securities exchange for the purpose of pegging, fixing, or stabilizing the price of such security in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.

(b) It shall be unlawful for any person to effect, by use of any facility of a national securities exchange, in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors

(1) any transaction in connection with any security whereby any party to such transaction acquires any put, call, straddle, or other option or privilege of buying the security from or selling the security to another without being bound to do so; or

(2) any transaction in connection with any security with relation to which he has, directly or indirectly, any interest in any such put, call, straddle, option, or privilege; or

(3) any transaction in any security for the account of any person who he has reason to believe has, and who actually has, directly or indirectly, any interest in any such put, call, straddle, option, or privilege with relation to such security.

(c) It shall be unlawful for any member of a national securities exchange directly or indirectly to endorse or guarantee the performance of any put, call, straddle, option, or privilege in relation to any security registered on a national securities exchange, in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors. (d) The terms “put”, “call”, “straddle",

“call ”, “ straddle ", " option ", or "privilege” as used in this section shall not include any registered warrant, right, or convertible security.

(e) Any person who willfully participates in any act or transaction in violation of subsection (a), (b), or (c) of this section, shall be liable to any person who shall purchase or sell any security at a price which was affected by such act or transaction, and the person so injured may sue in law or in equity in any court of competent jurisdiction to recover the damages sustained as a result of any such act or transaction. In any such suit the court may, in its discretion, require an undertaking for the payment of the costs of such suit, and assess reasonable costs, including reasonable attorneys' fees, against either party litigant. Every person who becomes liable to make any payment under this subsection may recover contribution as in cases of contract from any person who, if joined in the original suit, would have been liable to make the same payment. No action shall be maintained to enforce any liability created under this section, unless brought within one year after the discovery of the facts constituting the violation and within three years after such violation.

(f) The provisions of this section shall not apply to an exempted security.

REGULATION OF THE USE OF MANIPULATIVE AND DECEPTIVE DEVICES

SEC. 10. It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange

(a) To effect a short sale, or to use or employ any stop-loss order in connection with the purchase or sale, of any security registered on a national securities exchange, in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.

(b) To use or employ, in connection with the purchase or sale of any security registered on a national securities exchange or any security not so registered, any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the

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