2005 Nevada Revised Statutes - Chapter 694A — Trading of Equity Securities by Insiders

CHAPTER 694A - TRADING OF EQUITYSECURITIES BY INSIDERS

NRS 694A.010 Equitysecurity defined.

NRS 694A.020 Beneficialowner, director or officer required to file statements concerning equitysecurities with Commissioner.

NRS 694A.030 Profitsrealized from certain transactions recoverable by insurer; actions, limitationsand exceptions.

NRS 694A.040 Unlawfulsales of equity securities.

NRS 694A.050 Investmentaccounts and transactions.

NRS 694A.060 Foreignor domestic arbitrage transactions.

NRS 694A.070 Inapplicabilityof provisions to stock insurers.

NRS 694A.080 Regulations;classification of insurers and securities; acts done or omitted in good faith.

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NRS 694A.010 Equitysecurity defined. The term equity securitywhen used in this chapter means:

1. Any stock or similar security;

2. Any security convertible, with or withoutconsideration, into such a security, or carrying any warrant or right tosubscribe to or purchase such a security;

3. Any such warrant or right; or

4. Any other security which the Commissioner deems tobe of similar nature and considers necessary or appropriate, by such rules andregulations as he may prescribe in the public interest or for the protection ofinvestors, to treat as an equity security.

(Added to NRS by 1971, 1824)

NRS 694A.020 Beneficialowner, director or officer required to file statements concerning equitysecurities with Commissioner. Every person whois directly or indirectly the beneficial owner of more than 10 percent of anyclass of any equity security of a domestic stock insurer, or who is a directoror an officer of such insurer, shall:

1. File in the Office of the Commissioner within 10days after he becomes such beneficial owner, director or officer, a statement,in such form as the Commissioner may prescribe, of the amount of all equitysecurities of such insurer of which he is the beneficial owner; and

2. Within 10 days after the close of each calendarmonth thereafter, if there has been a change in such ownership during suchmonth, file in the Office of the Commissioner a statement, in such form as theCommissioner may prescribe, indicating his ownership at the close of thecalendar month and such changes in his ownership as have occurred during suchcalendar month.

(Added to NRS by 1971, 1824)

NRS 694A.030 Profitsrealized from certain transactions recoverable by insurer; actions, limitationsand exceptions.

1. For the purpose of preventing the unfair use ofinformation which may have been obtained by such beneficial owner, director orofficer by reason of his relationship to such insurer, any profit realized byhim from any purchase and sale, or any sale and purchase, of any equitysecurity of such insurer within any period of less than 6 months, unless suchsecurity was acquired in good faith in connection with a debt previouslycontracted, shall inure to and be recoverable by the insurer, irrespective ofany intention on the part of such beneficial owner, director or officer in enteringinto such transaction of holding the security purchased or of not repurchasingthe security sold for a period exceeding 6 months.

2. Suit to recover such profit may be instituted atlaw or in equity in any court of competent jurisdiction by the insurer, or bythe owner of any security of the insurer in the name and in behalf of theinsurer if the insurer fails or refuses to bring such suit within 60 days afterrequest or fails diligently to prosecute the same thereafter; but no such suitshall be brought more than 2 years after the date such profit was realized.

3. This section shall not be construed to cover anytransaction where such beneficial owner was not such both at the time of thepurchase and sale, or the sale and purchase, of the security involved, or anytransaction or transactions which the Commissioner by rules and regulations mayexempt as not comprehended within the purpose of this section.

(Added to NRS by 1971, 1825)

NRS 694A.040 Unlawfulsales of equity securities. It is unlawful forany such beneficial owner, director or officer, directly or indirectly, to sellany equity security of such insurer if the person selling the security or hisprincipal:

1. Does not own the security sold; or

2. If the owner of the security, does not deliver itagainst such sale within 20 days thereafter, or does not within 5 days aftersuch sale deposit it in the mails or other usual channels of transportation,

but noperson shall be deemed to have violated this section if he proves that notwithstandingthe exercise of good faith he was unable to make such delivery or depositwithin such time, or that to do so would cause undue inconvenience or expense.

(Added to NRS by 1971, 1825)

NRS 694A.050 Investmentaccounts and transactions.

1. The provisions of NRS 694A.030 do not apply to any purchaseand sale, or sale and purchase, and the provisions of NRS 694A.040 do not apply to any sale, ofan equity security of a domestic stock insurer not then or theretofore held byhim in an investment account, by a dealer in the ordinary course of hisbusiness and incident to the establishment or maintenance by him of a primaryor secondary market (otherwise than on an exchange as defined in the SecuritiesExchange Act of 1934) for such security.

2. The Commissioner may, by such rules and regulationsas he deems necessary or appropriate in the public interest, define andprescribe terms and conditions with respect to securities held in an investmentaccount and transactions made in the ordinary course of business and incidentto the establishment or maintenance of a primary or secondary market.

(Added to NRS by 1971, 1826)

NRS 694A.060 Foreignor domestic arbitrage transactions. The provisionsof NRS 694A.020, 694A.030 and 694A.040 do not apply to foreign or domesticarbitrage transactions unless made in contravention of such rules andregulations as the Commissioner may adopt in order to carry out the purposes ofthis chapter.

(Added to NRS by 1971, 1826)

NRS 694A.070 Inapplicabilityof provisions to stock insurers. The provisionsof NRS 694A.020, 694A.030 and 694A.040 do not apply to equity securitiesof a domestic stock insurer if:

1. Such securities are registered, or are required tobe registered, pursuant to section 12 of the Securities Exchange Act of 1934,as amended; or

2. Such domestic stock insurer has not any class ofits equity securities held of record by 100 or more persons on the lastbusiness day of the year next preceding the year in which equity securities ofthe insurer would be subject to the provisions of NRS 694A.020, 694A.030 and 694A.040 except for the provisions ofthis subsection.

(Added to NRS by 1971, 1826)

NRS 694A.080 Regulations;classification of insurers and securities; acts done or omitted in good faith.

1. The Commissioner shall have the power to make suchrules and regulations as may be necessary for the execution of the functionsvested in him by NRS 694A.010 to 694A.070, inclusive, and may for suchpurpose classify domestic stock insurers, securities and other persons ormatters within his jurisdiction.

2. No provision of NRS694A.020, 694A.030 and 694A.040 imposing any liability shallapply to any act done or omitted in good faith in conformity with any rule orregulation of the Commissioner, notwithstanding that such rule or regulationmay, after such act or omission, be amended or rescinded or determined byjudicial or other authority to be invalid for any reason.

(Added to NRS by 1971, 1826)