description in writing of any matters that would cause a disqualification under subrule (1)
of this rule, but which occurred before September 23, 2013.
(b) Upon a showing of good cause and without prejudice to any other action by the
administrator, if the administrator determines that it is not necessary under the
circumstances that an exemption be denied. Requests for a determination by the
administrator under this subsection must be made in writing.
(c) If, before the relevant sale, the court or regulatory authority that entered the relevant
order, judgment, or decree advises in writing, whether contained in the relevant order,
judgment, or decree, or separately to the administrator or its staff, that disqualification
under subrule (1) of this rule should not arise as a consequence of such order, judgment,
or decree.
(d) If the issuer establishes that it did not know and, in the exercise of reasonable care,
could not have known, that a disqualification existed under subrule (1) of this rule. For
purposes of this subrule, an issuer shall not be able to establish that it has exercised
reasonable care unless it has made, in light of the circumstances, factual inquiry into
whether any disqualifications exist. The nature and scope of the factual inquiry shall vary
based on the facts and circumstances concerning, among other things, the issuer and the
other offering participants.
History: 2019 AACS.
R 451.2.4 Intra-industry exemption for persons engaged in oil, gas, and mineral
business.
Rule 2.4. (1) Pursuant to section 203 of the act, MCL 451.2203, sales of certificates of
interest; participation in oil, gas, or mining titles or leases; payments out of production
under such titles or leases; or of other securities relating to oil, gas, or mining ventures
are exempt from registration requirements of section 301 of the act, MCL 451.2301,
when the offers or sales are made to any of the following:
(a) Persons who are engaged on a full-time basis in the business of exploring for, or the
producing, transporting, or refining of, oil, gas, or other minerals; buying, selling, and
trading of oil, gas, or mining titles or leases; payments out of production under such titles
or leases; or in any combination of the foregoing businesses and who have at least 3 years
of experience in any such business or combination thereof.
(b) Corporations or any subsidiaries of such corporations, any of the stock of which is
listed on the New York stock exchange or the American stock exchange, that are engaged
in any business specified in subdivision (a) of this subrule, or combination thereof, as a
principal line of business.
(2) As used in this rule, "engaged on a full-time basis," when applied in relation to the
business of exploring for, or the producing, transporting, or refining of, oil, gas, or other
minerals; buying, selling, and trading oil, gas, or mining titles or leases; payments out of
production under such titles or leases; or any combination of the foregoing businesses
means that the person is engaged in such business as his or her principal business activity
and, in the case of an individual, that the person is engaged in any such business in a
management capacity and either maintains an office for the conduct of such business or is
employed by a person maintaining such office.
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