1. (1) For purposes of this section, the following terms apply:

   1. (a) "Subscription right" means any warrant or certificate evidencing a right to subscribe to, or otherwise acquire, an equity security.
   2. (b) "Beneficiary security" means a security registered, pursuant to Section 12 of the Securities Exchange Act of 1934, 15 U.S.C. 78a, et seq., to the holders of which a subscription right is granted.
   3. (c) "Subject security" means a security that is the subject of a subscription right.

2. (2) A sale of a subscription right to acquire a subject security of the same insurer is exempt from Subsection 31A-5-303(2) if:

   1. (a) the subscription right is acquired, directly or indirectly, from the insurer without the payment of consideration;
   2. (b) the subscription right, by its terms, expires within 45 days after issuance;
   3. (c) the subscription right, by its terms, is issued on a pro rata basis to all holders of the beneficiary security of the insurer; and
   4. (d) a registration statement under the Securities Act of 1933 is in effect as to each subject security, or the applicable terms of any exemption from registration are met with respect to each subject security.
3. (3) If a person purchases subscription rights for cash or other consideration, then a sale by such person of subscription rights otherwise exempted by this section is not exempted to the extent of such purchases within the six-month period preceding or following the sale.

KEY: insurance law

Date of Last Change: June 9, 2023

Notice of Continuation: April 1, 2022

Authorizing, and Implemented or Interpreted Law: 31A-2-201; 31A-5-303