CITE

    15 USC Sec. 80a-62                                          01/05/2009

EXPCITE

    TITLE 15 - COMMERCE AND TRADE
    CHAPTER 2D - INVESTMENT COMPANIES AND ADVISERS
    SUBCHAPTER I - INVESTMENT COMPANIES

HEAD

    Sec. 80a-62. Distribution and repurchase of securities

STATUTE

      Notwithstanding the exemption set forth in section 80a-6(f) of
    this title, section 80a-23 of this title shall apply to a business
    development company to the same extent as if it were a registered
    closed-end investment company, except as follows:
        (1) The prohibitions of section 80a-23(a)(2) of this title
      shall not apply to any company which (A) is a wholly-owned
      subsidiary of, or directly or indirectly controlled by, a
      business development company, and (B) immediately after the
      issuance of any of its securities for property other than cash or
      securities, will not be an investment company within the meaning
      of section 80a-3(a) of this title.
        (2) Notwithstanding the provisions of section 80a-23(b) of this
      title, a business development company may sell any common stock
      of which it is the issuer at a price below the current net asset
      value of such stock, and may sell warrants, options, or rights to
      acquire any such common stock at a price below the current net
      asset value of such stock, if -
          (A) the holders of a majority of such business development
        company's outstanding voting securities, and the holders of a
        majority of such company's outstanding voting securities that
        are not affiliated persons of such company, approved such
        company's policy and practice of making such sales of
        securities at the last annual meeting of shareholders or
        partners within one year immediately prior to any such sale,
        except that the shareholder approval requirements of this
        subparagraph shall not apply to the initial public offering by
        a business development company of its securities;
          (B) a required majority (as defined in section 80a-56(o) of
        this title) of the directors of or general partners in such
        business development company have determined that any such sale
        would be in the best interests of such company and its
        shareholders or partners; and
          (C) a required majority (as defined in section 80a-56(o) of
        this title) of the directors of or general partners in such
        business development company, in consultation with the
        underwriter or underwriters of the offering if it is to be
        underwritten, have determined in good faith, and as of a time
        immediately prior to the first solicitation by or on behalf of
        such company of firm commitments to purchase such securities or
        immediately prior to the issuance of such securities, that the
        price at which such securities are to be sold is not less than
        a price which closely approximates the market value of those
        securities, less any distributing commission or discount.
        (3) A business development company may sell any common stock of
      which it is the issuer at a price below the current net asset
      value of such stock upon the exercise of any warrant, option, or
      right issued in accordance with section 80a-60(a)(3) of this
      title.

SOURCE

    (Aug. 22, 1940, ch. 686, title I, Sec. 63, as added Pub. L. 96-477,
    title I, Sec. 105, Oct. 21, 1980, 94 Stat. 2288.)