Rule 10b-7. Stabilizing to Facilitate a Distribution

(a) Scope of Rule. The provisions of this rule shall apply to any person who, either alone or with one or more other persons, directly or indirectly, stabilizes the price of a security to facilitate an offering of any security. It shall constitute a "manipulative or deceptive device or contrivance." as used in section 10(b) of the Act, for any such 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, to effect, either alone or with one or more other persons, any transaction or series of transactions prohibited by this rule.

(b) Definitions. Unless the context clearly indicates otherwise, for the purposes of this rule the following terms shall have the meaning indicated:

(1) The term "offering at the market" shall mean an offering in which it is contemplated that any offering price set in any calendar day will be increased more than once during such day.

(2) The term "transaction" shall mean a bid or a purchase.

(3) The terms "stabilize," "stabilizes," "stabilizing" or "stabilized" shall mean the placing of any bid, or the effecting of any purchase, for the purpose of pegging, fixing or stabilizing the price of any security: Provided, however, That a bid shall not constitute a stabilizing bid unless or until it is shown in the market.

(c) Transactions Must Be Necessary. No stabilizing bid or purchase shall be made except for the purpose of preventing or retarding a decline in the open market price of a security.

(d) Priority Must Be Granted. Any person placing or transmitting a bid which he knows is for the purpose of stabilizing the price of any security shall disclose the purpose of such bid to the person with whom it is placed or to whom it is transmitted. Any person placing a stabilizing bid or effecting a stabilizing purchase on a securities exchange shall grant priority to any independent bid at the same price irrespective of the size of such independent bid or the time when it is entered. Any person placing a stabilizing bid or effecting a stabilizing purchase otherwise than on a securities exchange shall grant priority to any independent bid at the same price placed with or

transmitted to him irrespective of the saf independent bid or the time when it is eas

(e) Control of Stabilizing. No sole d tor or syndicate or group stabilizing the print security nor any member or members of suidicate or group shall maintain more the stabilizing bid in any one market at the same at the same time: Provided, however, Tha: than one such bid at the same price may be tained otherwise than on a securities exchang or for the account of such distributor, sys or group.

(f) Stabilizing at Prices Resulting From [: lawful Activity. No stabilizing shall be initis: at a price which the stabilizer knows or has reas to know is the result of activity which is frant lent, manipulative, or deceptive under the Art any rule or regulation thereunder.

(g) Stabilizing Prohibited in Offerings at t Market. No person shall effect any stabiliz transaction to facilitate any offering at t

market.

(h) Stabilizing Securities Traded in Mer Than One Market. If a security is traded in mor than one market, stabilizing shall not be initiate at any price which would be unlawful in the ma ket which is the principal market for such securit in the United States open for trading at the tir when such stabilizing is initiated: Provided, how ever, That if the principal market for such sect rity in the United States is a securities exchange. stabilizing may be initiated in any market afte the close of such exchange at the price at which stabilizing could have been initiated on such er change at the close thereof unless the person stabilizing knows or has reason to know that other persons have offered or sold such security at a lower price after such close, except that special prives available to any group or class of persons (including employees or holders of warrants or rights) shall not limit the stabilizing price.

(i) Entering Stabilizing Bid on Exhange Prior to Opening. No person shall place a stabilizing bid on a securities exchange prior to the time the opening quotations for the security on such exchange are available, unless he has been and is lawfully stabilizing such security at such price; Provided, however, That a stabilizing bid may be made immediately prior to the opening of a securities exchange at a price not in excess of the price at which stabilizing could have been initiated on

exchange at the previous close thereof, unless ›erson stabilizing knows or has reason to know other persons have offered or sold such rity at a lower price after such close, except special prices available to any group or class persons (including employees or holders of rants or rights) shall not limit the tabilizing

e.

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7) Stabilizing Levels. (1) Except as provided subparagraphs (2), (3) and (4) of this paraph (j), no person shall (A) begin to stabilize ecurity at a price higher than the highest curt independent bid price for such security or ) raise the price at which he is stabilizing. If bona fide market for the security being disbuted exists at the time stabilizing is initiated, ɩbilizing may be initiated at a price not in excess the public offering price.

│(2) If the principal market for a security is securities exchange and stabilizing is initiated n such exchange the initial stabilizing bid or purhase may be made at a price not in excess of the ast independent sale price on such exchange if A) the security has been traded on such exchange ›n the day when stabilizing is begun, on either of he 2 preceding calendar days, or on the last preceding business day, and (B) the current asked price is equal to or above the last independent sale price. If both conditions (A) and (B) are not met, no person shall begin to stabilize the security at a price in excess of the highest current independent bid price for such security: Provided, however, That if a stabilizing bid has been entered at such independent bid price and the first sale thereafter on the exchange is an independent sale at a higher price, the security may be stabilized at a price not in excess of such independent sale price.

(3) If a stabilizing bid or purchase is made before the initial public offering price of the security to be distributed is determined, and such offering price is higher than such stabilizing bid or purchase price, then stabilizing may be resumed after determination of such public offering price at the price at which it could then be initiated: Provided, however, That special prices avaliable to any group or class of persons (including employees or holders of warrants or rights) shall not constitute the initial public offering price for purposes of this subparagraph (3).

(4) A stabilizing bid lawful when made may be continuously maintained or reduced irrespective

of changes in the independent bid, asked or sale price of such security: Provided, however, That no stabilizing shall be done at a price higher than the price at which stabilizing is being done in the principal market for such security. Except as provided in subparagraph (3) of this paragraph (j), if stabilizing is discontinued for less than 3 business days it shall not be resumed in connection with the same distribution except at the lower of the two following prices: (A) the last lawful stabilizing price, or (B) the price at which stabilizing could then be initiated. If no stabilizing purchases have been effected for 3 consecutive business days then stabilizing may be continued or resumed at the price at which it could then be initiated.

(5) No person shall stabilize a security at a price above the price at which such security is currently being distributed: Provided, however, That special prices available to any group or class of persons (including employees or holders of warrants or rights) shall not limit the stabilizing price.

(6) If a security goes ex-dividend, ex-rights, or ex-distribution, the price at which such security is being stabilized shall be reduced by an amount equal to the value of the dividend, right, or distribution, computed to the nearest trading differential: Provided, however, That if the dividend, right or distribution has a value of not more than 50 percent of the minimum price differential, the stabilizing price need not be reduced.

(7) When two or more securities are being offered as a unit, the component securities shall not be stabilized at prices the sum of which exceeds the offering price of the unit: Provided, however, That special prices available to any group or class of persons (including employees or holders of warrants or rights) shall not limit the stabilizing price.

(8) If a security is being called or redeemed it shall be unlawful to stabilize such security at a price above such call or redemption price plus accruals, if any: Provided, however, That if such security is immediately convertible into or exchangeable for another security or securities, and if the amount of such other security or securities (into which it is convertible or for which it is exchangeable) multiplied by their highest lawful stabilizing price exceeds the call or redemption price plus accruals, then the security may be

stabilized at a price not in excess of such price, to the nearest trading differential.

(k) Disclosure of Stabilizing. Any person subject to this rule who sells to, or purchases for the account of, any person, any security or any right or warrant to subscribe to any such security, where the price of such security, right or warrant has been stabilized, shall give or send to such person, at or before the completion of each transaction entered into while the distribution is in progress, written notice that stabilizing purchases may be or have been effected. If, however, at or before the completion of the transaction, the purchaser receives a prospectus, offering circular, confirmation or other writing containing a statement similar to that comprising the legend provided for in Rule 426 under the Securities Act of 1933, then no other written notice with respect to stabilizing need be given to such purchaser.

(7) Reporting Requirements. A person subject to this rule shall file with the Commission the reports and notices required to be filed by Rule 17a-2 even though he is not subject to that rule as a broker, dealer, or member of a national securities exchange.

(m) Limitation of Liability. Whenever any act done or omitted by any person subject to this rule would involve a violation of such rule only if some other person had previously done or omitted to do some other act, the act or omission of such firstmentioned person shall not involve a violation unless such first-mentioned person knew or had reason to know that such other person had previously done or omitted to do such other act.

(n) Exempted Securities. The provisions of this rule shall not apply to "exempted securities," as defined in section 3(a) (12) of the Act, including securities issued, or guaranteed both as to principal and interest, by the International Bank for Reconstruction and Development.

(0) Exempted Transactions. This rule shall not prohibit any transaction or transactions if the Commission, upon written request or upon its own motion, exempts such transaction or transactions, either unconditionally or on specified terms and conditions, as not constituting a manipulative or deceptive device or contrivance comprehended within the purpose of this rule.

Rule 10b-8. Distributions Through Rights

(a) Scope of Rule. It shall constitute a "manipulative or deceptive device or contrivance" as

used in section 10(b) of the Act for any per participating in a distribution of securities be offered through rights issued on a pro-rata to security holders, directly or indirectly, by use of any means or instrumentality of intersta commerce, or of the mails, or of any facility of national securities exchange, to do any act pr hibited by this rule prior to the expiration of t rights: Provided, however, That a person shall be subject to this rule merely because he receive compensation from the issuer of the rights obtaining exercises of rights by security hold: to whom they were originally issued.

(b) Except as provided in paragraph (c), 1 person subject to this rule shall offer or sell the securities being distributed, or securities of th same class and series, at a price in excess of the last price set by the person or persons manag the distribution or by a formula prescribed an agreement with such person or persons. price may be set from time to time, but an offering price set in any calendar day may not be increased more than once during such day. If the princ pal market for such security is a securities er change, such price shall not, at the time it is 90 set, exceed the price at which such security la sold on such exchange (plus an amount equal to an exchange commission) or the current asked price on such exchange (plus such commissions) whichever is higher. If the principal market for such security is not a securities exchange, such sale price shall not, at the time it is so set, exceed the highest price at which a dealer not participat ing in the distribution is then offering the security to other dealers (plus an amount equal to a dealer's concession). The amount of any accrued dividends or interest may be added to such prices.

(c) The provisions of paragraph (b) shall not apply to (1) privately negotiated transactions effected otherwise than on a securities exchange, among persons participating in the distribution; or (2) odd-lot transactions (and the off-setting round-lot transactions hereinafter referred to) by a person registered as an odd-lot dealer in such security on a national securities exchange who off sets such odd-lot transaction in such security by round-lot transactions as promptly as possible; or (3) brokerage transactions not involving solicitation of the customer's order; or (4) offers and sales at the subscription price to holders of rights; or (5) offers and sales to members of any group or class entitled to a special price; or (6) offers

d sales of securities owned beneficially on the cord date for the rights or acquired through the ercise of rights issued in respect of securities so ned.

(d) The conditions of subparagraphs (A) rough (G) of this paragraph (d) shall apply to 1 bids for and purchases of rights on behalf of sole distributor, or a syndicate or group particiating in the distribution, or any member or memers of such a syndicate or group, during any eriod when (1) the price of the security is being tabilized to facilitate the distribution, or (2) such ole distributor, or such syndicate or group, or any nember or members thereof, having purchased, as ›rincipal, any right not necessary to acquire seurities previously sold by such person or such yndicate or group, in connection with the distribution, has not sold the securities which have been or can be acquired through such rights: Provided, however, That the conditions of subparagraphs (A) through (G) shall not become applicable because of the purchase of rights in any transaction described in subparagraph (H) of this paragraph (d). As used herein the term "syndicate or group" means (i) all persons who have agreed to purchase from the issuer of rights any of the securities offered through but not purchased upon the exercise of the rights; (ii) all "soliciting dealers" as defined in subparagraph (H)(viii) hereof, including a "dealer manager" as therein defined, and (iii) all persons who have agreed with the issuer of rights, or with each other, that they will engage in the purchase of rights and the sale of the securities which may be acquired through the exercise of rights.

(A) Not more than one bid to purchase rights shall be maintained in any one market, at the same price at the same time: Provided, however, That more than one bid at the same price may be maintained otherwise than on a securities exchange by or for the account of the sole distributor or for the account of the syndicate or group.

(B) No bid for or purchase of rights shall be made until an independent market for such rights has been established: Provided, however, That if (i) trading has not begun on the business day on which trading in such rights could lawfully have begun, and (ii) the theoretical value of such rights can be ascertained by a generally accepted mathematical formula-then such right may be purchased thereafter at a price not in excess of such theoretical value.

(C) The initial bid for or purchase of such rights under the conditions of this paragraph (d) shall not be made at a price higher than the highest current independent bid price in the principal market for such rights in the United States open for trading at the time when such bid or purchase is made: Provided, however, That if the principal market for such rights is a securities exchange in the United States open for trading at such time, such initial bid or purchase may be made in any market at the last independent sale price on such exchange if (i) such right has been traded on such exchange on such day or on the preceding business day and (ii) the current asked price on such exchange is equal to or above such sale price: And provided further, That if the initial bid or purchase is made after the close of such exchange such initial bid or purchase may be made at the price at which such initial bid or purchase could have been made on such exchange at the close thereof unless the bidder or purchaser knows, or has reason to know, that other persons have offered or sold such right at a lower price after such close.

(D) Subject to the limitations in subparagraph (G) of this paragraph (d), a bid which is lawful when initiated may be continuously maintained or reduced irrespective of changes in the independent bid, asked or sale price of such right. Except as provided in subparagraph (E) of this paragraph (d), if the bidding for and purchasing of rights is discontinued for any reason, bidding for or purchasing of rights shall not be resumed except at a price not exceeding the lower of the two following prices; (i) the last price at which a lawful bid or purchase was made or (ii) the price which would be applicable if it were the initial bid or purchase.

(E) The price at which a bid for or purchase of rights is made may be increased only if (i) no rights have been purchased, as principal, for a full business day, by the sole distributor, or any syndicate or group, or any member thereof, except in a transaction described in subparagraph (H) of this paragraph (d), or (ii) the independent bid price in the principal market for such rights in the United States has exceeded such price for a full business day; Provided, however, That the increased bid or purchase price in any such case shall meet the requirements which would be applicable if it were the initial bid or purchase. As used herein the term "full business day" shall mean a period beginning at any time on any busi

ness day and extending to the same time on the next succeeding business day.

(F) In the event that the conditions of this paragraph (d) have ceased to be applicable, and then later become applicable again, the first bid for or purchase of rights after such conditions have again become applicable shall be treated as the initial bid for or purchase of rights under the conditions of this paragraph (d) for purposes of subparagraphs (C), (D) and (E) thereof.

(G) Purchases of rights shall be limited to those necessary to acquire the securities which the sole distributor, or the members of the syndicate or group, have previously sold and reasonably expect to be able to sell within 5 business days after the expiration of the rights.

(H) Except as provided in clause (viii) hereof, the provisions of this paragraph (d) shall not apply to the purchase of rights,

(i) by or through the manager of the distributing group in a privately negotiated transaction effected neither on a securities exchange nor from or through a broker or dealer not participating in the distribution; or

(ii) by an underwriter or dealer directly from a retail customer in an unsolicited privately negotiated transaction not effected on a securities exchange; or

(iii) in stabilizing transactions in the rights effected in compliance with Rule 10b-7; or

(iv) in a privately negotiated transaction, otherwise than on a securities exchange, between persons participating in the distribution acting as principal; or

(v) by a person registered as an odd-lot dealer in such rights on a national securities exchange who is acting in such capacity in effecting such transactions; or

(vi) to complete a sale of rights to a retail customer made under circumstances indicating the purchaser intends to exercise such rights; or

(vii) by the issuer of the rights from the security holder to whom they were originally issued if (1) such rights are not resold, (2) the securities which can be acquired with such rights are not sold by such issuer during the rights period, and (3) such issuer has no agreement to sell the unsubscribed shares or to compensate, directly or indirectly, any person for obtaining exercises of rights except by a security holder to whom they were originally issued; or

(viii) by a dealer-manager: Provided, That such dealer-manager has no arrangement with th issuer of the rights to purchase any part of t securities remaining unsubscribed after the rig expire, (2) such dealer-manager purchases sur rights for the purpose of supplying the rights, the security which can be acquired with su rights, to soliciting dealers: Provided, howeve That such dealer-manager shall not purchase mor rights than are necessary to acquire the secur ties or rights which he reasonably expects to be able to sell to soliciting dealers within 5 busines days after the expiration of the rights, and (3) such dealer-manager purchases such rights in & cordance with the conditions set out in subpar graphs (B), (C), (D), (E) and (F) of this subparagraph (d). As used herein, the term "soliciting dealer” shall mean a person entitled receive, directly or indirectly, from an issuer of rights, compensation for obtaining exercises of such rights; and the term "dealer-manager" shall mean a person who manages a distribution involv ing soliciting dealers except that the issuer of such rights shall not be deemed to be a dealer-manager. (e) Whenever any act done or omitted by any person subject to this rule would involve a viola tion of such rule only if some other person had previously done or omitted to do some other act, the act or omission of such first-mentioned person shall not involve a violation unless such first-mentioned person knew or had reason to know that such other person had previously done or omitted

to do such other act.

(f) This rule shall not prohibit any transaction or transactions if the Commission, upon written request or upon its own motion, exempts such transaction or transactions, either unconditionally or on specified terms and conditions, as not constituting a manipulative or deceptive device or contrivance comprehended within the purpose of this rule.

Rule 10b-9. Prohibited Representations in Connection With Certain Offerings

(a) It shall constitute a "manipulative or deceptive device or contrivance," as used in section 10(b) of the Act, for any person, directly or indirectly, in connection with the offer or sale of any security, to make any representation:

(1) to the effect that the security is being offered or sold on an "all-or-none" basis, unless the security is part of an offering or distribution being