1-1     By:  Ratliff, Lucio                                    S.B. No. 808

 1-2           (In the Senate - Filed February 26, 1997; March 4, 1997, read

 1-3     first time and referred to Committee on Jurisprudence;

 1-4     April 16, 1997, reported favorably, as amended, by the following

 1-5     vote:  Yeas 6, Nays 0; April 16, 1997, sent to printer.)

 1-6     COMMITTEE AMENDMENT NO. 1                            By:  Wentworth

 1-7     Amend S.B. No. 808 as follows:

 1-8           (1)  On page 1, lines 33, 35, and 42 and on page 1, lines 51

 1-9     and 52, replace the word "subsection" with "Section 33N"

1-10           (2)  On page 1, lines 47-48, replace "Paragraph (a) of this

1-11     subdivision" with "Section 33N(2)(a)"

1-12           (3)  On page 1, line 51, replace "all actions" with "any

1-13     action or series of actions under Section 33"

1-14           (4)  On page 1, lines 55-56, delete "in an action described

1-15     by this subdivision"

1-16     COMMITTEE AMENDMENT NO. 2                            By:  Wentworth

1-17     Amend S.B. No. 808 in SECTION 1 of the bill, page 1, line 50, in

1-18     added Section 33N of the Texas Securities Act (Article 581-33,

1-19     Vernon's Texas Civil Statutes), add the following:

1-20                 (c)  and applies to a person who relied on a disclosure

1-21     in the prospectus or offering documents of a small business issuer

1-22     describing the limitations of liability in this subsection as

1-23     provided.

1-24                            A BILL TO BE ENTITLED

1-25                                   AN ACT

1-26     relating to limiting the liability of certain persons involved in

1-27     an issuance of securities by a small business.

1-28           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-29           SECTION 1.  Section 33, The Securities Act (Article  581-33,

1-30     Vernon's Texas Civil Statutes), is amended by adding Subsection N

1-31     to read as follows:

1-32           N.  Limitation of Liability in Small Business Issuances.

1-33     (1)  For purposes of this subsection, unless the context otherwise

1-34     requires, "small business issuer" means an issuer of securities

1-35     that, at the time of an offer to which this subsection applies:

1-36                 (a)  has annual gross revenues in an amount that does

1-37     not exceed $25 million; and

1-38                 (b)  does not have a class of equity securities

1-39     registered, or required to be registered, with the Securities and

1-40     Exchange Commission under Section 12 of the Securities Exchange Act

1-41     of 1934, as amended (15 U.S.C. Section 78l).

1-42           (2)  This subsection applies only to:

1-43                 (a)  an offer of securities made by a small business

1-44     issuer or by the seller of securities of a small business issuer

1-45     that is in an aggregate amount that does not exceed $5 million; and

1-46                 (b)  a person who has been engaged to provide services

1-47     relating to an offer of securities described by Paragraph (a) of

1-48     this subdivision, including an attorney, an accountant, a

1-49     consultant, or the firm of the attorney, accountant, or consultant.

1-50           (3)  The maximum amount that may be recovered against a

1-51     person to which this subsection applies in all actions relating to

1-52     an offer of securities to which this subsection applies is an

1-53     amount equal to three times the fee paid by the issuer or other

1-54     seller to the person for the services related to the offer of

1-55     securities, unless the trier of fact in an action described by this

1-56     subdivision finds the person engaged in intentional wrongdoing in

1-57     providing the services.

1-58           SECTION 2.  This Act applies only to an action filed on or

1-59     after the effective date of this Act.  An action filed before the

1-60     effective date of this Act is governed by the law in effect at the

1-61     time the action was filed, and that law is continued in effect for

1-62     that purpose.

1-63           SECTION 3.  The importance of this legislation and the

1-64     crowded condition of the calendars in both houses create an

 2-1     emergency and an imperative public necessity that the

 2-2     constitutional rule requiring bills to be read on three several

 2-3     days in each house be suspended, and this rule is hereby suspended,

 2-4     and that this Act take effect and be in force from and after its

 2-5     passage, and it is so enacted.

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