How is the transient investment company exemption one-year period calculated?
The one-year period begins on the earlier of: • the date an issuer owns or proposes to acquire investment securities having a value exceeding 40 per cent of the value of the issuer’s total assets (excluding US government securities and cash items) on an unconsolidated basis; or • the date on which the issuer owns securities and/or cash having a value exceeding 50 per cent of the value of the issuer’s total assets on either a consolidated or unconsolidated basis. In certain cases, the SEC’s staff has granted exemptive relief in the form of “no-action letters” to issuers that fail to transfer sufficient assets from investment securities to non-investment security assets within the one-year period. In determining whether to grant such exemptive relief, the SEC’s staff typically examines three factors: (i) whether the failure of the issuer to transfer such assets within the one-year period was due to factors beyond its control, (ii) whether the issuer attempted, in good faith, during the c
