1. The provisions of section 375.423 shall not apply to any purchase and sale, or sale and purchase, and the provisions of section 375.424 shall not apply to any sale, of an equity security of such insurance company not then or theretofore held by him in an investment account, by a dealer in the ordinary course of his business and incident to the establishment or maintenance by him of a primary or secondary market, otherwise than on an exchange as defined in the Securities Exchange Act of 1934, for such security. The director may, by such rules and regulations as he deems necessary or appropriate in the public interest, define and prescribe terms and conditions with respect to securities held in an investment account and transactions made in the ordinary course of business and incident to the establishment or maintenance of a primary or secondary market.

2. The provisions of sections 375.422, 375.423 and 375.424 shall not apply to foreign or domestic arbitrage transactions unless made in contravention of such rules and regulations as the director may adopt in order to carry out the purposes of this section.

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3. The provisions of sections 375.422, 375.423 and 375.424 shall not apply to equity securities of such insurance company if:

(1) Such securities shall be registered, or shall be required to be registered, pursuant to section 12 of the Securities Exchange Act of 1934, as amended; or

(2) If such insurance company shall not have any class of its equity securities held of record by one hundred or more persons on the last business day of the year next preceding the year in which equity securities of the company would be subject to the provisions of sections 375.422, 375.423 and 375.424, except for the provisions of this subdivision.

4. The term “equity security” when used in this section means any stock or similar security; or any security convertible, with or without consideration, into such a security, or carrying any warrant or right to subscribe to or purchase such a security; or any such warrant or right; or any other security which the director shall deem to be of similar nature and consider necessary or appropriate, by such rules and regulations as he may prescribe in the public interest or for the protection of investors, to treat as an equity security.