(2) Such additional information and documents as the Commission may by rules, regulations, or orders require as being necessary or appropriate in the public interest or for the protection of investors.

(3) In the case of a reorganization plan pending before a court, official, or agency of the United States or of any State or Territory having jurisdiction or authorized by law to approve plans, a copy of any opinion theretofore rendered by such court, official, or agency on the fairness and equity of such plan, or a summary thereof approved by such court, official, or agency; and

(4) A copy of any report made on the plan by the Commission pursuant to section 13, or a summary thereof approved by the Commission, in such form as the Commission may approve.

STOP ORDERS

SEC. 9. (a) The Commission may at any time, after notice to the agent designated in the declaration for the purpose of receiving the same, by personal service or by the sending of such notice by registered mail or by the sending of confirmed telegraphic notice, and after opportunity for hearing (at a time fixed by the Commission) within fifteen days after such notice by personal service or the sending of such notice by registered mail or such telegraphic notice, issue a stop order suspending the effectiveness of a declaration as to any one or more or all of the persons as to whom such declaration is effective, if it finds that

(1) Such declaration or the prospectus filed therewith includes any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading;

(2) Any fact exists, a finding as to the existence of which would have necessitated or justified the entry of an order pursuant to section 6 or 7 refusing to permit such declaration to become effective; or

(3) Any person for whom a declaration is in effect, or any person acting for or on behalf of the declarant, is soliciting or has solicited any proxy, deposit, or assent in violation of any term, condition, restriction, or limitation in the order, or in any amendment or modification thereof, permitting such declaration to become effective or in violation of any provision of this act or of any rule, regulation, or order thereunder.

(b) Upon the issuance of any stop order, such declaration and all proxies, deposits, or assents solicited or obtained by the declarant pursuant thereto shall cease to be effective for any purpose, unless and to the extent that the Commission may otherwise provide in such order, and the declarant shall take such steps as the Commission may deem necessary or appropriate in the public interest or for the protection of investors, to cancel or cause to be canceled the same, to return or cause to be returned all deposited securities to the persons entitled thereto, and to give notice, to interested security holders and any court, official, or agency having jurisdiction in the premises, of the issuance and the effect of such stop order, and otherwise to prevent evasion of the purposes of this act.

(c) If any declarant or any counsel, agent, depositary, or employee of a declarant shall fail to cooperate or shall obstruct or refuse to permit the making of an examination, such conduct shall be ground for the issuance of a stop order.

TERMS AND CONDITIONS ON WHICH SOLICITATION OF PROXIES, DEPOSITS, OR ASSENTS IS TO BE MADE

SEC. 10. (a) For the purposes of paragraph (4) of subsections (a), (b), and (c) of section 6, it is required that every solicitation of proxies, deposits, or assents be on such terms and conditions (to be expressed in the prospectus and/or in such proxy or assent or in a certificate of deposit, deposit agreement, or other instrument) that the solicitation and receipt of such proxy, deposit, or assent will constitute an agreement containing

(1) Adequate provisions for review and determination of fees and expenses of the declarant, after notice and opportunity for a hearing to all interested parties, by a designated independent person or governmental agency having jurisdiction or authorized by law to exercise such function;

(2) Adequate provisions for at least an annual report and an accounting by declarant to those represented by it, in such form as the Commission may require or approve; and for the filing of copies of such report and accounting with the Commission:

(3) Adequate prohibitions against declarant or, if declarant is a committee or group, any member of such committee or group, and against any person who is a director, officer, or employee or of attorney for, or is directly or indirectly controlled by any of the foregoing, (A) buying or selling any securities of the issuer

or certificates of deposit therefor so long as the rights and powers conferred upon declarant or upon such person by such proxy, deposit, or assent shall continue to be effective, or (B) being or becoming pecuniarily interested, directly or indirectly (except on behalf of the securities to be represented by declarant), in any contracts, arrangements, or undertaking with the issuer or with any successor company, or their respective nominees or agents, with respect to any matter or matters whatsoever except exchanges or subscriptions (other than underwritings) under the plan, or participation in the management of the continuing or successor company, as director, officer, or employee;

(4) Adequate provisions to the effect that the authority conferred by the proxies, deposits, or assents to be solicited shall cease, and any deposited securities shall be returned to the respective depositors

(A) if and when the declaration shall cease to be effective, unless and to the extent that the Commission shall otherwise provide in its order suspending the effectiveness of such declaration, and subject to such terms and conditions as may be contained in such order; and

(B) in the case of solicitations in respect of the support, adoption, approval, or disapproval of a reorganization plan pending before a court, official, or agency of the United States or of any State or Territory having jurisdiction or authorized by law to approve plans, (i) if and when such court, official or agency shall have rescinded its approval thereof or (ii) if and when such plan shall be amended, unless such court, official, or agency finds that such amendment does not materially adversely affect the fairness or equity of such plan; and

(C) in the case of solicitations in respect of a plan of readjustment, (i) if reorganization proceedings are instituted by or against the issuer and (ii) if, in the case of such proceedings instituted against the issuer and not consented to by the issuer, such proceedings have not been dismissed within sixty days; (5) Provisions to the effect that the authority conferred by any deposit to be solicited shall be limited (A) to the tender of the deposited securities in order to bid for or purchase all or part of the assets of the issuer at judicial or foreclosure sale, pursuant to the plan in connection with which such deposit was solicited, where such tender is necessary under applicable law; (B) to the tender of the deposited securities in order to effect an acceptance of the terms of the plan or an exchange of such securities pursuant to the terms thereof, when so provided in the plan; (C) to constituting declarant trustee of an express trust, where such trusteeship is necessary under applicable law in order to permit declarant to maintain suits at law or in equity necessary or appropriate for the protection of investors; (D) to such authority only as is necessary to enable declarant to collect on behalf of the depositor, interim or partial payments or distributions on account of the securities deposited; or (E) to such other authority as may be established to the satisfaction of the Commission as necessary for the protection of investors. (b) For the purposes of paragraph (8) of subsection (a) of section 7, it is required that every solicitation of proxies, deposits, or assents be on such terms and conditions (to be expressed in the prospectus and/or in such proxy or assent, or in a certificate of deposit, deposit agreement, or other instrument) that the solicitation and receipt of such proxy, deposit, or assent will constitute an agreement containing

(1) Such limitations or restrictions on the employment by declarant of any attorney or any firm of attorneys which has, or which has represented, materially conflicting interests as the Commission, by rule, regulation, or order, may prescribe as necessary or appropriate in the public interest or for the protection of investors; (2) Such limitations upon the rights and powers conferred upon the declarant, including, without limitation of the generality of the foregoing, the right and power of the declarant to create a lien upon the deposited securities, or to impose conditions or restrictions upon the right to deposit and the depositor's right to withdraw, and provisions imposing such duties and liabilities upon declarant, and such other provisions, including provisions prohibiting the failure of the owner of the deposited security to dissent from having the same effect as an affirmative assent, requiring independent review and determination of any condition or fact affecting the rights of security holders thereunder, and protecting minorities against oppressive or inequitable practices, as the Commission, by rule, regulation, or order, may prescribe as necessary or appropriate in the public interest or for the protection of investors, in light of the fiduciary relationship to be assumed by declarant or by such person and the purpose or purposes for which such proxies, deposits, or assents are to be solicited.

PROPOSAL OF PLAN

REORGANIZATIONS

SEC. 11. (a) A reorganization plan may be deemed to be improperly proposed

(1) If the person proposing the same is neither (A) the beneficial owner of securities of or claims against the issuer or a representative of such owner expressly authorized to propose the plans; (B) a trustee under an indenture under which securities of the issuer are outstanding, which indenture conforms to the requirements of the Trust Indenture Act of 1937; nor (C) an officer designated by the court, official, or agency before which the reorganization is pending, and authorized by it to prepare a plan, if such court, official, or agency has jurisdiction or is authorized by law to approve plans; or

(2) If any person who is directly or indirectly proposing such plan or causing the same to be proposed is the issuer; or

(3) If any person or persons who is directly or indirectly proposing such plan or causing the same to be proposed is or was an underwriter of any presently outstanding securities of the issuer, or is or was at any time within one year preceding the submission of such plan a director or officer of the issuer or of any such underwriter, unless the proponents of such plan beneficially own in the aggregate 10 per centum of any class of security of the issuer or 5 per centum of all securities of the issuer, determined in such manner as the Commission may prescribe.

VOLUNTARY READJUSTMENTS; DEBT ARRANGEMENTS

(b) A plan of readjustment or of debt arrangement may be deemed to be improperly proposed

(1) If the person proposing the same is neither (A) the issuer nor the beneficial owner of securities of or claims against the issuer, nor (B) a representative of the issuer or of such owner expressly authorized to propose the plan, nor (C) a trustee under an indenture under which securities of the issuer are outstanding, which indenture conforms to the requirements of the Trust Indenture Act of 1937; or (2) If any person or persons who is directly or indirectly proposing such plan or causing the same to be proposed is or was an underwriter of any presently outstanding securities of the issuer, or is or was at any time within one year preceding the submission of such plan a director or officer of any such underwriter, unless the proponents of such plan beneficially own in the aggregate 10 per centum of any class of security of the issuer or 5 per centum of all securities of the issuer, determined in such manner as the Commission may by rules and regulations prescribe.

CONTENTS OF PLAN

SEC. 12. (a) Subject to the provisions of subsections (b) and (c) of this section, a plan shall include a specification of each of the following matters:

(1) The arrangements, if any, for underwriting securities to be issued under the plan;

(2) The arrangements, if any, for obtaining additional cash or capital; (3) The arrangements, if any, for management of the issuer or its successor; (4) The fees and expenses (or an estimate thereof) to be paid out of the estate or by the security holders for services in respect of the reorganization, readjustment, or debt arrangement, including services of counsel to interested parties, except that it shall not be necessary to specify such fees and expenses as will be allowed by a court, official, or agency having jurisdiction or authorized by law to perform such functions;

(5) The treatment accorded various classes of securities and claims under the plan together with a description of the securities not affected by the plan.

(b) In the case of reorganization plans pending before a court, official, or agency having jurisdiction or authorized by law to approve reorganization plans, such specification may be omitted if and to the extent that such court, official, or agency shall have (A) found the inclusion of such specification impracticable or (B) conditioned its order approving the plans upon the inclusion of such specification by amendment of the plan.

(c) In the case of any other plan, such specification may be omitted if and to the extent that the Commission deems that the inclusion of such specification is impracticable or that the public interest and the interests of investors will be adequately protected by conditioning the order fixing the date on which such declaration or statement is to become effective on the inclusion of such specification by amendment to such plan.

REPORTS BY COMMISSION

SEC. 13. (a) The Commission shall render a report on any reorganization plan required to be submitted to it by a court, official, or agency of the United States or of a Territory in accordance with paragraph 5 of subsection (a) of section 6, if such plan is properly proposed and has been filed with the Commission in compliance with its rules and regulations, and the Commission has been supplied with such information and opportunity for investigation as may be required by the Commission by rule, regulation or order: Provided, however, That the Commission need not render such report in any such case if it deems that by reason of its status as intervenor or other party in such proceedings it can otherwise inform or advise the court of its views on such plan.

(b) The Commission may render a report on any other plan or reorganization pending before a court, official, or agency of the United States or of any State or Territory having jurisdiction or authorized by law to approve reorganization plans upon the request of such court, official, or agency.

(c) The Commission may, after notice and opportunity for hearing, render a report on any reorganization plan not described in subsection (a) or (b) of this section, or upon any plan of readjustment, where it appears to the Commission to be necessary or appropriate in the public interest or for the protection of investors so to do.

(d) Any reports which the Commission is required or authorized to make by this section shall contain such findings or comments as the Commission may deem necessary or appropriate with respect to the fairness and equity of the treatment accorded various classes of security holders and claimants by terms of the plan; the adequacy of the steps taken to discover, disclose, and collect all assets of the issuer or of individual security holders or claimants, including causes of action against officers and directors of the issuer and underwriters of its securities; the reasonableness and propriety of the fees and the expenses of the reorganization charged or to be charged, directly or indirectly, against the assets of the issuer or against security holders; whether or not the provision which has been made in the plan for management of the reorganized issuer is in the interests of the security holders; and any other phase or phases of the plan. The Commission shall notify any court, official, or agency before which any proceedings for reorganization are pending of all action taken by it under this Act in respect of any such plan.

INTERVENTION; SUPERVISION OVER DECLARANTS

SEC. 14. (a) The Commission shall have power to intervene in any proceeding for reorganization pending before any court, official, or agency of the United States or Territory and shall intervene in any such proceedings before any court, official, or agency of the United States in which the indebtedness of the person in reorganization equals or exceeds $5,000,000. Courts, officials, and agencies of the United States shall authorize and permit such intervention and shall accord to the Commission all rights and powers of a party in interest in the proceedings. The Commission shall also have power to intervene in any proceedings for reorganization pending before any court, official, or agency of any State, with the consent of such court, official, or agency.

(b) The Commission shall have power to act as arbiter between any declarant and the security holders represented by it, or to sit in review on the reasonableness of or determine the fees and expenses of any declarant, or to supervise the activities of any declarant or the exercise by it of any rights, powers, or duties under any proxy, deposit agreement, or similar instrument: Provided however, That the Commission shall not be so designated by any declarant unless its prior written consent is obtained: And provided further, That the Commission may, having accepted the designation, resign at any time.

UNLAWFUL SALES AND PURCHASES

SEC. 15. It shall be unlawful for any person for whom a declaration is effective to buy or sell any security of the issuer during the pendency of the reorganization, voluntary readjustment, or debt arrangement by the use of the mails or of any means or instrumentality of interstate commerce.

UNLAWFUL METHODS OF SOLICITATION

SEC. 16. (a) It shall be unlawful for any person in the solicitation of any proxy, deposit, assent, or dissent by the use of the mails or of any means or instrumentality of interstate commerce, directly or indirectly

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(1) To employ any device, scheme, or artifice to defraud, or

(2) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statement made, in light of the circumstances under which they are made, not misleading.

(b) It shall be unlawful for any person, by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, to make or cause to be made any statement or to publish, give publicity to, circulate, or cause to be published or circulated any notice, circular, advertisement, newspaper, article, letter, investment service, or communication which, though not purporting to solicit proxies or deposits in respect of, or assents to or dissents from, a plan, describes such plan for a consideration received or to be received, directly or indirectly, from any person, without fully disclosing in such description the receipt, whether past or prospective, of such consideration and the amount thereof.

REPATRIATION OF SECURITIES OF FOREIGN GOVERNMENTS AND POLITICAL SUBDIVISIONS

SEC. 17. It shall be unlawful for any person, by use of the mails or any means or instrumentality of interstate or foreign commerce, either as principal, agent, dealer, broker, delivering or forwarding agent, or otherwise, to purchase or to participate in the purchase of a defaulted security issued or guaranteed by a foreign government, knowing or having reasonable cause to believe that such defaulted security is thereby acquired or will be acquired, either directly or by subsequent transfer, by such foreign government, or by any agent of such foreign government, or by any corporation, association, or partnership subject to its jurisdiction, or by any individual domiciled or residing within its territory. As used in this section the term "foreign government" shall include any political subdivision thereof; the term "security" shall meen any bond, note, debenture, evidence of indebtedness, or other obligation which is payable by its terms, either absolutely or at the option of the holder, in currency of the United States; and the term "defaulted security" shall mean any such security as to which a default exists in the payment of principal or interest in accordance with its terms, such default not having been cured, or compromised with the consent of the owner of such security.

RULES, REGULATIONS, AND ORDERS

SEC. 18. (a) The Commission shall have authority from time to time to make, issue, amend, and rescind such rules and regulations and such orders as it may deem necessary or appropriate in the public interest or for the protection of investors and to carry out the provisions of this act, including rules and regulations defining accounting, technical, and trade terms used in this act. Among other things, the Commission shall have authority, for the purposes of this act, to prescribe the form or forms in which information required in any declaration, report, or other document filed with the Commission shall be set forth. For the purpose of its rules or regulations the Commission may classify persons and matters within its jurisdiction and prescribe different requirements for different classes of persons or matters.

(b) Subject to the provisions of the Federal Register Act and regulations heretofore or hereafter prescribed under the authority thereof, the rules and regulations of the Commission shall be effective upon publication in the manner which the Commission shall prescribe or upon such later date as may be provided in such rules and regulations.

(c) The Commission, by such rules and regulations or order as it deems necessary or appropriate in the public interest or for the protection of investors or consumers, may authorize the filing of any information or documents required to be filed with the Commission under this act, or under the Securities Act of 1933, or under the Securities Exchange Act of 1934, or under the Public Utility Holding Company Act of 1935, by incorporating by reference any information or documents on file with the Commission under this Act or any such Act. No provision of this act imposing any liability shall apply to any act done or omitted in good faith in conformity with any rule, regulation, or order of the Commission, notwithstanding that such rule, regulation or order may, after such act or omission, be amended or rescinded or be determined by judicial or other authority to be invalid for any

reason.