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Summaries and explanations attached to certain exhibits after they were offered in evidence with a view to assisting the trial examiner's disposition of the matter, held, properly included in transcript of the proceedings as argumentative material, the Commission being fully apprised of the nature of the material and having ruled that such data did not constitute evidence.

In certifying transcript of record to reviewing court, held, the mechanical tasks of compilation and copying may be delegated to Commission employees, but certification is the act of the Commission and should be evidenced, like other Commission actions, by the signature of Commission's Secretary, as well as by affixing by Secretary of Commission's seal.

Pursuant to direction of the reviewing court, held certificate should be made in the statutory language that transcript is of the record “upon which” rather than "included" orders complained of were entered ... Page 395 MANIPULATION OF TRADING ON NATIONAL SECURITIES EXCHANGE

Where president and controlling person of registered broker-dealer admittedly caused broker-dealer to purchase certain stock through national securities exchange at prices in excess of last prior quotation, when president planned to sell substantial quantities of such stock owned or controlled by him for which registration statement was then pending before Commission, held, willful violation of Section 9 (a) (2) of Securities Exchange Act of 1934 by broker-dealer, requiring, in the public interest, revocation of broker-dealer's registration ... Page 227 REVOCATION OF REGISTRATION

Where a registered broker-dealer has engaged in manipulative practices in willful violation of Section 9 (a) (2) of the Securities Exchange Act of 1934 and was permanently enjoined from engaging in certain practices in connection with the purchase and sale of securities, held, that it is in the public interest to revoke its registration pursuant to Section 15 (b) of the Act . . . Page 227 MANIPULATIVE ACTIVITIES

Where it is shown that a person having a substantial direct interest in the success of a proposed offering takes active steps to effect a rise in the market price of outstanding securities of the issue, held, such showing establishes prima facie manipulative purpose constituting element of violation of Section y (a) (2) of the Securities Exchange Act of 1934, even though there was no immediate resale of the shares which were purchased in the process of raising the market and prices paid were within the market range of the stock for some time, both before and after the purchases, and at other times independent persons effected transactions at levels as high as the level to which the market was raised ... Page 227 SALE OF UNREGISTERED SECURITIES

Where registered broker-dealer sold substantial amounts of securities pot registered as required under Section 5 (a) of the Securities Act; failed to file reports of his financial condition as required under Section 17 (a) of the Securities Exchange Act, and failed to disclose in his application for registration as a broker-dealer the revocation in Ontario of his license to sell securities and that he was permanently enjoined from engaging in certain practices in the sale and purchase of securities, held, willful violations of Securities Act and Securities Exchange Act, requiring, in the public interest, denial of requested permission to withdraw from registration, and revocation of broker-dealer's registration ... Page 294

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WITHDRAWAL OF REGISTRATION

Where registered broker-dealer, during hearing in revocation proceedings establishing a willful violation of Commission's Rule requiring filing of financial reports, seeks to withdraw his registration, and it appears that for several years said broker-dealer has not engaged in business as a broker-dealer, held that under circumstances presented the public interest and the protection of investors is adequately served by withdrawal rather than revocation, and withdrawal will be permitted . . . Page 32 STRIKING OF SECURITY FROM LISTING AND REGISTRATION

Application by exchange to strike security from listing granted without terms where corporation in impaired financial condition is engaged in no current operations and its future prospects of profitable operation are very doubtful and trading in security has been suspended for some time by exchange for those reasons ...

Page 287 SECRET PROFITS

Where applicant for registration as a broker and dealer sold his own securities at a profit to customers of the firm employing him in transactions confirmed on an agency basis, held, willful violation of Section 17 (a) of the Securities Act of 1933, Sections 10 (b) and 15 (c) (1) of the Securities Exchange Act of 1934 and rules thereunder Page 208 PRIOR INJUNCTION

Where registered broker-dealer consented to the entry of a permanent injunction restraining him from engaging in and continuing certain practices in connection with the sale of securities, held, injunction is not subject to collateral attack in broker-dealer revocation proceeding . . . Page 372

NATIONAL SECURITIES ASSOCIATIONS

DENIAL OF MEMBERSHIP

Where national securities association disapproves application for membership solely because of disability arising from applicant's previous expulsion, where such expulsion and previous revocation of registration were based on similar misconduct, where Commission has found it consistent with public interest to grant reapplication for registration, and where national securities association has offered no additional information or basis for denying application for membership, held, appropriate in the public interest to direct broker-dealer's admission to membership in said association ... Page 28 CONTINUANCE IN MEMBERSHIP

Application of national securities association pursuant to Section 15A (b) (4) of the Securities Exchange Act of 1934 for approval of continuance in membership of broker-dealer employing individual under disqualification from employment by members, approved, upon showing that such employment was appropriate in the public interest ... Pages 450 and 648 REVIEW OF DISCIPLINARY PROCEEDINGS

Setting Aside Action of Association Where national association disciplined a member for violation of its roles on the basis of evidence insufficient to support its findings of violation and an erroneous application of its rules to that evidence, action of association set aside and record remanded to association for such reconsideration and further proceedings not inconsistent with Commission's opinion as it should deem appropriate . . . Page 437

PART III

PUBLIC UTILITY HOLDING COMPANY ACT*

OF 1935

ACQUISITION OF SECURITIES

Where registered holding company proposes to see portfolio securities, acquisition of ad ional stock permitted in connection with stabilization operations ... Page 696 ACQUISITION BY SUBSIDIARY OF REGISTERED HOLDING COMPANY

Securities Proposed acquisition, by public-utility subsidiary of registered holding company, of all the common stock and debt of a public-utility company, which is a subsidiary of another registered holding company, serving neighboring areas in the same state, approved, under Sections 9 (a) and 10, subject to certain conditions ... Page 782

Proposed acquisition of common stock by parent, a registered holding company, from its subsidiary approved subject to reservation of jurisdiction pursuant to the requirements of Section 11 (b) of the Act ... Page 561

Application of registered holding company, proposing to acquire, pursuant to plan under Section 11 (e), new bonds and new common stock in exchange for all bonds and common stock presently outstanding of such subsidiary, granted ... Page 459

Temporary acquisition by registered holding company, pursuant to a plan under Section 11 (e), of securities in a company in which holding company had been ordered to divest itself of all interest, granted, where plan of reorganization compromised litigation and remove legal and practical impediments to the ultimate divestment of such interest ... Page 264

Application and declaration filed by registered holding company regarding acquisition of new common stock of surviving subsidiary of a merger of two subsidiaries in exchange for old common stocks of such subsidiaries held by parent, granted and permitted to become effective, under Sections 9, 10 and 12 ... Page 618

Application filed pursuant to Sections 9 (a) (2) and 10 of the Public Utility Holding Company Act of 1935 by purchasers of common stock of three newly formed public-utility companies, granted, the Commission finding that the standards of Section 10 of the Public Utility Holding Company Act of 1935 are satisfied . . . Page 126 INTEREST IN OTHER BUSINESS

Application-declaration by a public utility company which is a subsidiary of a registered holding company to acquire interest in a nonutility company, granted

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The term “Act" as used in Part III of this Digest refers to the Public Utility Holding Company Act of 1935.

25 S. E. C.

and permitted to become effective, the Commission finding the proposed acquisi. tion meets the standards of Sections 9 (a), and 10 and 12 (f) of the Act ... Page 65 UTILITY ASSETS BY SUBSIDIARY

Application-declaration pursuant to Sections 10 and 12 (f) of the Act and Rule U-43 thereunder regarding acquisition by subsidiary of registered holding company, from its parent, of utility assets, granted and permitted to become effective ... Page 65

Application by subsidiary of a registered holding company to acquire securi. ties and assets of three electric utility companies, such companies to be dissolved and their business, property, and other assets acquired in liquidation, approved, the Commission making no advance findings under Sections 10 (b) and 10 (c) (1) and finding that the transactions have the tendency required by Section 10 (c) (2) ... Page 728

Acquisition by registered holding companies of the common stock of their subsidiary, approved, the Commission making no adverse findings under Sections 10 (b) and 10 (c) (1) and finding that the transaction has the tendency required by Section 10 (c) (2) ... Page 728 MERGER OF UTILITY COMPANIES AND ACQUISITION OF SECURITIES

Joint application-declaration of registered holding company and two of its utility subsidiaries proposing the merger of the subsidiaries and the acquisition by the surviving company from the parent holding company of all the shares of capital stock of the merging companies in exchange for shares of new common stock of the surviving company, granted and permitted to become effective .. Page 473

ALTERATION OF RIGHTS

SECURITY HOLDERS

Declaration regarding changes in the charter provisions of a public utility subsidiary company affecting the common stock of subsidiary, permitted to become effective, the Commission making no adverse findings under Section 7 (e) of the Act ... Page 709

Declaration filed pursuant to Section 6 (a) (2) of the Public Utility Holding Company Act of 1935 by a subsidiary of a registered holding company regarding changes in its surplus accounts and in the charter and mortgage provisions effecting the rights and privileges of its security holders, permitted to become effective, the Commission observing no basis for adverse findings under Section ñ (e) of the Act ... Page 76 AMENDMENT OF BY-LAWS

Declaration under Section 7 by a subsidiary of a registered holding company seeking authorization to amend its by-laws so as to limit the preemptive right of its stockholders; permitted to become effective Page 427 AMENDMENT TO SECTION 11 (e) PLAN

Where an amendment filed by a registered holding company to its heretofore approved Section 11 (e) plan of dissolution provides, in general, for the distribution on a pro rata basis of its investment in its only remaining subsidiary, consisting of the common stock of such subsidiary, to the holders of Voting Trust Certificates for its common stock, and for the subsequent dissolution of the holding company, held that such amendment is necessary to effectuate the provisions of Section 11 (b) and fair and equitable to the persons affected thereby . . . Page 303

EXEMPTIONS

SECURITY ISSUE OF SUBSIDIARY OF REGISTERED HOLDING COMPANY

Application for exemption of issue and sale of securities by subsidiary of
registered holding company, having been expressly authorized by State Commis-
sion of State in which the subsidiary is organized and doing business, granted,
pursuant to Section 6 (b) of the Act, subject to terms and conditions, the issue
and sale being solely for the purpose of financing the business of the sub-
sidiary ... Page 728
COMPETITIVE BIDDING

Application for exemption from competitive bidding requirements of Rule U-50
with respect to proposed convertible preferred shares and unsubscribed common
shares granted, where particular circumstances of case, including imminent ma-
turities of holding company's outstanding debentures, nature of issuer and
securities involved, and history of Section 11 (e) plan, render such exemption
appropriate in the public interest and in the interests of investors and cus-
tomers ... Page 388

Application for exemption from the competitive bidding requirements of Rule
U-50 requested by subsidiary of registered holding company with respect to
the issuance of new preferred stock subsequent to merger and by the surviving
corporation where the new preferred stock will be offered in exchange for the
preferred stocks of the constituent corporations and no shares will be sold to the
public, granted, pursuant to subparagraph (a) (5) of Rule U-50 ... Page 619

Application for exemption from competitive bidding requirements of Rule U-50
with respect to sale by registered holding company of part of its holdings of
.common stock of a subsidiary by issuance to its stockholders of transferable
purchase warrants entitling the holders to buy said common stock, granted as to
all shares sold upon exercise of said purchase warrants, and further granted
as to a sale of shares represented by unexercised purchase warrants on the New
York Stock Exchange, subject to condition that any other method of sale of such
shares be subject to further order of the Commission ... Page 405

Application by a subsidiary of a registered holding company pursuant to See-
tion 6 (b) of the Public Utility Holding Company Act of 1935 for exemption from
the provisions of Section 6 (a) of the Act of the issue and sale of bonds and pre-
ferred stock at competitive bidding, such issue and sale being solely for the
purpose of financing the business of the applicant, granted, subject to an order
expressly authorizing such issue and sale being issued by the State Commission
of the State in which such applicant is organized and doing business . . . Page 76

Issuance and sale of common stock by a nonutility subsidiary of a registered
holding company, for cash and property, granted exemption pursuant to Section
6 (b) of the Act . .. Page 65

Application of non-utility subsidiary company of registered holding company
for exemption from the competitive bidding requirements of Rule U-50 in re-
spect of a sale of debentures to an underwriting group, granted . . . Page 719

Exemption from competitive bidding requirements of Rule U-50 requested by
registered holding company in connection with a declaration filed pursuant to
Section 12 (d) of the Act for the sale of all the capital stock of a subsidiary to :
non-affiliated company granted under Clause C of paragraph (a) (5) of Rule
U-50 ... Page 328

Alternative to competitive bidding procedure prescribed by Rule U-50 per-
mitted where alternative appears to involve only technical change in mechanics of
complying with rule.

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