June 28, 1990
TO: UNIT INVESTMENT TRUST MEMBERS NO. 40-90
RE: VERMONT ISSUES ADMINISTRATIVE ORDER GRANTING AN
EXEMPTION FOR RESALES
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In most states, unit trusts rely on an exemption from
registration under the state securities acts for resales of units
of unit trusts. The most commonly relied on exemption is the
manual exemption, which exempts a distribution if the issuer is
listed in a securities manual accepted by the state securities
department. Several states have recently attempted to amend or
repeal their manual exemption, because of the belief that
securities that could otherwise not qualify for registration,
such as penny stocks, are being sold under the manual exemption.
The Vermont Legislature recently enacted legislation that
repealed the manual exemption as of July 1, 1990. The Institute
contacted the Vermont Securities Division and testified before
the Vermont Senate Finance Committee regarding the consequences
such repeal would have on resales of units of unit trusts. We
are pleased to announce that the Vermont Securities Division has
issued an administrative order granting an exemption for resales
of units of unit trusts provided such units were initially
registered in Vermont.
A copy of the order is attached.
Patricia Louie
Assistant General Counsel
Attachment