Page:United States Statutes at Large Volume 94 Part 2.djvu/999

 PUBLIC LAW 96-477—OCT. 21, 1980

94 STAT. 2277

company's total assets. Such issuer nonetheless is deemed to be an investment company for purposes of section 12(d)(1). 15 USC 80a-i2. "(B) Beneficial ownership by any person who acquires securities or interests in securities of an issuer described in the first sentence of this paragraph shall be deemed to be beneficial ownership by the person from whom such transfer was made, pursuant to such rules and regulations as the Commission shall prescribe as necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of this title, where the transfer was caused by legal separation, divorce, death, or other involuntary event.". EXEMPTION FROM INVESTMENT COMPANY ACT OF 1940

SEC. 103. Section 6 of the Investment Company Act of 1940 (15 U.S.C. 80a-6) is amended by adding at the end thereof the following new subsection: "(f) Any closed-end company which— "(1) elects to be treated as a business development company pursuant to section 54; or "(2) would be excluded from the definition of an investment company by section 3(c)(1), except that it presently proposes to make a public offering of its securities as a business development company, and has notified the Commission, in a form and manner which the Commission may, by rule, prescribe, that it intends in good faith to file, within 90 days, a notification of election to become subject to the provisions of sections 55 through 65, shall be exempt from sections 1 through 53, except to the extent provided in sections 59 through 65.". VALIDITY OF CONTRACTS

SEC. 104. Section 47(b) of the Investment Company Act of 1940 (15 U.S.C. 80a-46(b)) is amended to read as follows: "(b)(1) A contract that is made, or whose performance involves, a violation of this title, or of any rule, regulation, or order thereunder, is unenforceable by either party (or by a nonparty to the contract who acquired a right under the contract with knowledge of the facts by reason of which the making or performance violated or would violate any provision of this title or of any rule, regulation, or order thereunder) unless a court finds that under the circumstances enforcement would produce a more equitable result than nonenforcement and would not be inconsistent with the purposes of this title. "(2) To the extent that a contract described in paragraph (1) has been performed, a court may not deny rescission at the instance of any party unless such court finds that under the circumstances the denial of rescission would produce a more equitable result than its grant and would not be inconsistent with the purposes of this title. "(3) This subsection shall not apply (A) to the lawful portion of a contract to the extent that it may be severed from the unlawful portion of the contract, or (B) to preclude recovery agsiinst any person for unjust enrichment.".

Post, p. 2278. Ante, p. 2276.

Post, pp. ^f^us^so -l— 80a-52. Post, pp. 2285-2289.

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