C.F.R. » Title 17 » CHAPTER II—SECURITIES AND EXCHANGE COMMISSION › PART 240—GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 1934

17 C.F.R. § 240.16a-7

Transactions effected in connection with a distribution

Read at: eCFRecfr.gov CornellLII GovInfogovinfo.gov CasesGoogle Scholar

(a) Any purchase and sale, or sale and purchase, of a security that is made in connection with the distribution of a substantial block of securities shall be exempt from the provisions of section 16(a) of the Act, to the extent specified in this rule, subject to the following conditions:

(1) The person effecting the transaction is engaged in the business of distributing securities and is participating in good faith, in the ordinary course of such business, in the distribution of such block of securities; and

(2) The security involved in the transaction is:

(i) Part of such block of securities and is acquired by the person effecting the transaction, with a view to distribution thereof, from the issuer or other person on whose behalf such securities are being distributed or from a person who is participating in good faith in the distribution of such block of securities; or

(ii) A security purchased in good faith by or for the account of the person effecting the transaction for the purpose of stabilizing the market price of securities of the class being distributed or to cover an over-allotment or other short position created in connection with such distribution.

(b) Each person participating in the transaction must qualify on an individual basis for an exemption pursuant to this section.

Notes of Decisions
Cited in 1 case, 2009–2009 · leading case: In Re Section 16 (B) Litig., 602 F. Supp. 2d 1202 (W.D. Wash. 2009).
Sort: Relevance Newest Treatment
In Re Section 16 (B) Litig., 602 F. Supp. 2d 1202 (W.D. Wash. 2009). “17 C.F.R. 240.16a-7. 8 . Section 16(d) provides an exemption for short-swing profits made in the ordinary course of business and incident to market-making activities.”
Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.