GENERAL RULES AND REGULATIONS UNDER THE SECURITIES EXCHANGE ACT OF 1934 RULES OF GENERAL APPLICATION Rule 0-1. References to Rules and Regulations and to the Act, or to Portions Thereof. (a) As used in the rules and regulations prescribed by the Commission pursuant to Title I of the Securities Exchange Act of 1934, unless the context otherwise specifically requires— (1) The term "Commission" means the Securities and Exchange Commission. (2) The term "Act" means Title I of the Securities Exchange Act of 1934. (3) The term "section" refers to a section of the Securities Exchange Act of 1934. (4) The term "rules and regulations" refers to all rules and regulations adopted by the Commission pursuant to the Act, including the forms for registration and reports and the accompanying instructions thereto. (b) Unless otherwise specifically stated, the terms used in the rules and regulations shall have the meaning defined in the Act. (c) A rule or regulation which defines a term without express reference to the Act or to the rules and regulations, or to a portion thereof, defines such term for all purposes as used both in the Act and in the rules and regulations, unless the context otherwise specifically requires. (d) Unless otherwise specified or the context otherwise requires, the term "prospectus" means a prospectus meeting the requirements of Section 10 (a) of the Securities Act of 1933 as amended. Rule 0-2. Business Hours of the Commission. The principal office of the Commission at Washington, D. C., is open each day except Saturdays and holidays from 9:00 a. m. to 5:30 p. m. Eastern Standard Time or Eastern Daylight Saving Time whichever is currently in effect in Washington. Rule 0-3. Filing of Material With the Commission. All papers required to be filed with the Commission pursuant to the Act or the rules and regulations thereunder shall be filed at its principal office in Washington, D. C. Material may be filed by delivery to the Commission, through the mails or otherwise. The date on which papers are actually received by the Commission shall be the date of filing thereof if all of the requirements with respect to the filing have been complied with. Rule 0-4. Nondisclosure of Information Obtained in the Course of Examinations and Investigations. Information or documents obtained by officers or employees of the Commission in the course of any examination or investigation pursuant to section 17 (a) or 21 (a) shåll, unless made a matter of public record, be deemed confidential. Officers and employees are hereby prohibited from making such confidential information or documents or any other non-public records of the Commission available to anyone other than a member, officer, or employee of the Commission, unless the Commission authorizes the disclosure of such information or the production of such documents as not being contrary to the public interest. Any officer or employee who is served with a subpoena requiring the disclosure of such information or the production of such documents shall appear in court and, unless the authorization described in the preceding sentence shall have been given, shall respectfully decline to disclose the information or produce the documents called for, basing his refusal upon this rule. Any officer or employee who is served with such a subpoena shall promptly advise the Commission of the service of such subpoena, the nature of the information or document sought, and any circumstances which may bear upon the 1 1 desirability of making available such information or documents. Rule 0-5. Reference to Rule by Obsolete Designation. Wherever in any rule, form, or instruction book specific reference is made to a rule by number or other designation which is now obsolete, such reference shall be deemed to be made to the corresponding rule or rules in these General Rules and Regulations. Rule 0-6. Disclosure Detrimental to the National Security. (a) Any requirement to the contrary notwithstanding, no application for registration, report, proxy statement or other document filed with the Commission or any securities exchange shall contain any document or information that has been classified or determined by an appropriate department or agency of the United States to require protection in the interests of national defense. (b) Where a document is omitted pursuant to paragraph (a) hereof, there shall be filed, in lieu of such document, a statement from an appropriate department or agency of the United States to the effect that such document has been classified or that the status of such document is awaiting determination. Where a document is omitted pursuant to paragraph (a) hereof, but information relating to the subject-matter of such document is nevertheless included in material filed with the Commission pursuant to a determination of an appropriate department or agency of the United States that disclosure of such information would not be contrary to the interests of national defense, a statement to that effect shall be submitted for the information of the Commission. (c) The Commission may protect any information in its possession which may require classification in the interests of national defense pending determination by an appropriate department or agency as to whether such information should be classified. Rule 0-7. Consent to Service of Process To Be Furnished by Non-resident Investment Advisers and by Non-resident Investment General Partners or Managing Agents of Investment Advisers. (a) Each non-resident investment adviser registered or applying for registration pursuant to Section 203 of the Investment Advisers Act of 1940, each non-resident general partner of an investment adviser partnership which is registered or applying for registration, and each non-resident managing agent of any other unincorporated investment adviser which is registered or applying for registration, shall furnish to the Commission, in a form prescribed by or acceptable to it, a written irrevocable consent and power of attorney which (1) designates the Securities and Exchange Commission as an agent upon whom may be served any process, pleadings, or other papers in any civil suit or action brought in any appropriate court in any place subject to the jurisdiction of the United States, where the cause of action (i) accrues on or after the effective date of this rule, (ii) arises out of any activity, in any place subject to the jurisdiction of the United States, occurring in connection with the conduct of business of an investment adviser, and (iii) is founded, directly or indirectly, upon the provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company Act of 1940, the Investment Advisers Act of 1940, or any rule or regulation under any of said Acts; and (2) stipulates and agrees that any such civil suit or action may be commenced by the service of process upon the Commission and the forwarding of a copy thereof as provided in paragraph (c) of this rule, and that the service aforesaid of any such process, pleadings, or other papers upon the Commission shall be taken and held in all courts to be as valid and binding as if due personal service thereof had been made. (b) The required consent and power of attorney shall be furnished to the Commission within the following period of time: (1) Each non-resident investment adviser registered at the time this rule becomes effective, and each non-resident general partner or managing agent of an unincorporated investment adviser registered at the time this rule becomes effective, shall furnish such consent and power of attorney within 60 days after such date; (2) Each investment adviser applying for registration after the effective date of this rule shall furnish, at the time of filing such application, all the consents and powers of attorney required to be furnished by such investment adviser and by each general partner or managing agent thereof; Provided, however, That where an ap plication for registration of an investment adviser is pending at the time this rule becomes effective such consents and powers of attorney shall be furnished within 30 days after this rule becomes effective. (3) Each investment adviser registered or applying for registration who or which becomes a non-resident investment adviser after the effective date of this rule, and each general partner or managing agent, of an unincorporated investment adviser registered or applying for registration, who becomes a non-resident after the effective date of this rule, shall furnish such consent and power of attorney within 30 days thereafter. (c) Service of any process, pleadings or other papers on the Commission under this rule shall be made by delivering the requisite number of copies thereof to the Secretary of the Commission or to such other person as the Commission may authorize to act in its behalf. Whenever any process, pleadings or other papers as aforesaid are served upon the Commission, it shall promptly forward a copy thereof by registered mail to the appropriate defendants at their last address of record filed with the Commission. The Commission shall be furnished a sufficient number of copies for such purpose, and one copy for its file. MISCELLANEOUS Rule 3a12-2. Exemption of Certain Securities, the Income on Which Is Substantially Guaranteed by States or Political Subdivisions Thereof. (a) A security shall be exempt from the operation of such provisions of the Act as by their terms do not apply to an "exempted security" or to "exempted securities" if— (1) A State or political subdivision thereof is obligated to make good to the issuer of such security any deficiency in the income of such issuer, to the extent necessary to pay to the holders of such security interest or dividends at a specified rate; and (2) The business of such issuer is managed by (d) For purposes of this rule the following definitions shall apply: (1) The term "investment adviser" shall have the meaning set out in Section 202 (a) (11) of the Investment Advisers Act of 1940. (2) The term "managing agent" shall mean any person, including a trustee, who directs or manages or who participates in the directing or managing of the affairs of any unincorporated organization or association which is not a partnership. (3) The term "non-resident investment adviser" shall mean (A) in the case of an individual, one who resides in or has his principal place of business in any place not subject to the jurisdiction of the United States; (B) in the case of a corporation, one incorporated in or having its principal place of business in any place not subject to the jurisdiction of the United States; (C) in the case of a partnership or other unincorporated organization or association, one having its principal place of business in any place not subject to the jurisdiction of the United States. (4) A general partner or managing agent of an investment adviser shall be deemed to be a nonresident if he resides in any place not subject to the jurisdiction of the United States. EXEMPTIONS1 such State or political subdivision or by a board of officers appointed by such State or political subdivision. (b) The exemption provided by this rule shall be available to such security only so long as the conditions specified in paragraph (a) are satisfied or during the subsequent dissolution of the issuer of any security so exempted. Rule 3a12-3. Exemption From Sections 14 (a) and 16 of Securities for Which Filing of Applications on Form 18, 19, 20, or 21 Is Authorized. Securities for which the filing of applications on form 18, 19, 20, or 21 is authorized shall be exempt from the operation of sections 14 (a) and 16. 1 See also the exemptions contained in the rules under particular sections of the Act. Rule 3b-1. Definition of “Listed.” DEFINITIONS The term "listed" means admitted to full trading privileges upon application by the issuer or its fiscal agent or, in the case of the securities of a foreign corporation, upon application by a banker engaged in distributing them; and includes securities for which authority to add to the list on official notice of issuance has been granted. Rule 3b-2. Definition of "Officer." The term "officer" means a president, vice presi dent, treasurer, secretary, comptroller, and any other person who performs for an issuer, whether incorporated or unincorporated, functions corresponding to those performed by the foregoing officers. Rule 3b-3. Definition of "Short Sale." The term "short sale" means any sale of a security which the seller does not own or any sale which is consummated by the delivery of a security borrowed by, or for the account of, the seller. REGISTRATION AND EXEMPTION OF EXCHANGES Rule 6a-1. Form of Application and Amendments. (a) An application of an exchange for registration as a national securities exchange, or for exemption from such registration, shall be made in duplicate on Form 1, each of which shall be accompanied by the statement and exhibits prescribed to be filed in connection therewith. (b) An amendment to such application shall be made in duplicate on Form 1-A, and each amendment shall be dated and numbered in order of filing. (c) Promptly after the discovery that any information in the statement, any exhibit, or any amendment was inaccurate when filed, the exchange shall file with the Commission an amendment correcting such inaccuracy. (d) Whenever the number of changes to be reported in an amendment, or the number of amendments filed, are so great that the purpose of clarity will be promoted by the filing of a new complete statement and exhibits, an exchange may, at its election, or shall, upon request of the Commission, file as an amendment a complete new statement together with all exhibits which are prescribed to be filed in connection with Form 1. Rule 6a-2. Annual Amendments to Registration Statement or Exemption Statements of Exchanges. Prior to June 30 of each year each exchange registered as a national securities exchange or exempted from such registration shall file an annual amendment setting forth: (a) All changes, and the effective dates there of, which have been effected in any of the information contained or incorporated in the statement, or in exhibits A (1), A (2), A (3), B, C, and D, and which have not previously been reported in an annual amendment. Such amendment shall bring the statement and exhibits A (1), A (2), A (3), B, C, and D up to date as of the latest practicable date within one month of the date on which the amendment is filed. In the event that no changes have occurred in any of this material during the period covered by the amendment, a statement to that effect shall be set forth in the amendment. (b) Complete exhibits E and F as of the end of the latest fiscal year of the exchange, and of each affiliate and subsidiary listed in answer to item 8 of the statement. In the event that exhibit F is inapplicable to the exchange for the reason that it has no affiliate or subsidiary, the amendment shall include a statement to that effect in lieu of the information called for in exhibit F. (c) Complete exhibits G, H, I, J, K, L, and M. The information contained in these exhibits shall be up to date as of the latest practicable date within 3 months of the date on which the annual amendment is filed. Rule 6a-3. Supplemental Material. Each exchange registered as a national securities exchange or exempted from such registration shall furnish the following supplemental material: (a) Within 10 days after any action is taken which renders no longer accurate any of the information contained or incorporated in the state ment or in any exhibit (except exhibits E, F, L, and M), or in any amendment thereto, the exchange shall file with the Commission written notification in triplicate setting forth the nature of such action and the effective date thereof. Such notification may be filed either in the form of a letter or in the form of a notice made generally available to members of the exchange. file with the Commission 3 copies of such material. (c) Within 15 days after the end of each calendar month, the exchange shall file with the Commission a report concerning the securities sold on such exchange during such calendar month, setting forth: (1) the number of shares of stock sold and the aggregate dollar amount thereof; (b) Within 10 days after issuing or making generally available to members of the exchange any material (including notices, circulars, bulletins, lists, periodicals, etc.) the exchange shall EXEMPTION OF CERTAIN SECURITIES FROM THE OPERATION OF SECTION 7 (c) (2) (2) the principal amount of bonds sold and the aggregate dollar amount thereof; and (3) the number of units of rights and warrants sold and the aggregate dollar amount thereof. Rule 7c2-1. Exemption from Section 7 (c) (2) had been a security (other than an exempted security) registered on a national securities exchange. (b) So long as any security which is not registered on a national securities exchange continues to be admitted to either listed or unlisted trading privileges on any exchange which is exempted from registration as a national securities exchange, such security shall be exempt from the operation of section 7 (c) (2) to the extent necessary to render lawful any direct or indirect extension or maintenance of credit thereon or any direct or indirect arrangement therefor which would not have been unlawful if such security had been a security (other than an exempted security) registered on a national securities exchange. HYPOTHECATION OF CUSTOMERS' SECURITIES Rule 8c-1. Hypothecation of Customers' Securities. (a) General provisions.—No member of a national securities exchange, and no broker or dealer who transacts a business in securities through the medium of any such member shall, directly or indirectly, hypothecate or arrange for or permit the continued hypothecation of any securities carried for the account of any customer under cir cumstances— (1) that will permit the commingling of securities carried for the account of any such customer with securities carried for the account of any other customer, without first obtaining the written consent of each such customer to such hypothecation; (2) that will permit such securities to be commingled with securities carried for the account of any person other than a bona fide customer of such member, broker or dealer under a lien for a loan made to such member, broker or dealer; or (3) that will permit securities carried for the account of customers to be hypothecated, or subjected to any lien or liens or claim or claims of the pledgee or pledgees, for a sum which exceeds the aggregate indebtedness of all customers in respect of securities carried for their accounts; except that this clause shall not be deemed to be violated by reason of an excess arising on any day through the reduction of the aggregate indebtedness of customers on such day, provided that funds or securities in an amount sufficient to eliminate such excess are paid or placed in transfer to pledgees for the purpose of reducing the sum of the liens or claims to which securities carried for the account of customers are subjected as |