§5304. Securities registration by qualification

Link to law: http://legislature.vermont.gov/statutes/section/09/150/05304
Published: 2015

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The Vermont Statutes Online



Title

09

:
Commerce and Trade






Chapter

150

:
SECURITIES ACT






Subchapter

003
:
REGISTRATION OF SECURITIES AND NOTICE FILING OF FEDERAL COVERED SECURITIES










 

§

5304. Securities registration by qualification

(a) A security

may be registered by qualification under this section.

(b) A

registration statement under this section must contain the information or

records specified in section 5305 of this chapter, a consent to service of

process complying with section 5611 of this chapter, and, if required by rule

adopted under this chapter, the following information or records:

(1) with respect

to the issuer and any significant subsidiary, its name, address, and form of

organization; the state or foreign jurisdiction and date of its organization;

the general character and location of its business; a description of its

physical properties and equipment; and a statement of the general competitive

conditions in the industry or business in which it is or will be engaged;

(2) with respect

to each director and officer of the issuer, and other person having a similar

status or performing similar functions, the person's name, address, and

principal occupation for the previous five years; the amount of securities of

the issuer held by the person as of the 30th day before the filing of the

registration statement; the amount of the securities covered by the

registration statement to which the person has indicated an intention to subscribe;

and a description of any material interest of the person in any material

transaction with the issuer or a significant subsidiary effected within the

previous three years or proposed to be effected;

(3) with respect

to persons covered by subdivision (2) of this subsection, the aggregate sum of

the remuneration paid to those persons during the previous 12 months and

estimated to be paid during the next 12 months, directly or indirectly, by the

issuer, and all predecessors, parents, subsidiaries, and affiliates of the

issuer;

(4) with respect

to a person owning of record or owning beneficially, if known, 10 percent or

more of the outstanding shares of any class of equity security of the issuer,

the information specified in subdivision (2) of this subsection other than the

person's occupation;

(5) with respect

to a promoter, if the issuer was organized within the previous three years, the

information or records specified in subdivision (2) of this subsection, any

amount paid to the promoter within that period or intended to be paid to the

promoter, and the consideration for the payment;

(6) with respect

to a person on whose behalf any part of the offering is to be made in a

nonissuer distribution, the person's name and address; the amount of securities

of the issuer held by the person as of the date of the filing of the

registration statement; a description of any material interest of the person in

any material transaction with the issuer or any significant subsidiary effected

within the previous three years or proposed to be effected; and a statement of

the reasons for making the offering;

(7) the

capitalization and long-term debt, on both a current and pro forma basis, of

the issuer and any significant subsidiary, including a description of each

security outstanding or being registered or otherwise offered, and a statement

of the amount and kind of consideration, whether in the form of cash, physical

assets, services, patents, goodwill, or anything else of value, for which the

issuer or any subsidiary has issued its securities within the previous two

years or is obligated to issue its securities;

(8) the kind and

amount of securities to be offered; the proposed offering price or the method

by which it is to be computed; any variation at which a proportion of the

offering is to be made to a person or class of persons other than the

underwriters, with a specification of the person or class; the basis on which

the offering is to be made if otherwise than for cash; the estimated aggregate

underwriting and selling discounts or commissions and finders' fees, including

separately cash, securities, contracts, or anything else of value to accrue to

the underwriters or finders in connection with the offering or, if the selling

discounts or commissions are variable, the basis of determining them and their

maximum and minimum amounts; the estimated amounts of other selling expenses,

including legal, engineering, and accounting charges; the name and address of

each underwriter and each recipient of a finder's fee; a copy of any

underwriting or selling group agreement under which the distribution is to be

made or the proposed form of any such agreement whose terms have not yet been

determined; and a description of the plan of distribution of any securities

that are to be offered otherwise than through an underwriter;

(9) the

estimated monetary proceeds to be received by the issuer from the offering; the

purposes for which the proceeds are to be used by the issuer; the estimated

amount to be used for each purpose; the order or priority in which the proceeds

will be used for the purposes stated; the amounts of any funds to be raised

from other sources to achieve the purposes stated; the sources of the funds;

and, if a part of the proceeds is to be used to acquire property, including

goodwill, otherwise than in the ordinary course of business, the names and

addresses of the vendors, the purchase price, the names of any persons that

have received commissions in connection with the acquisition, and the amounts

of the commissions and other expenses in connection with the acquisition,

including the cost of borrowing money to finance the acquisition;

(10) a

description of any stock options or other security options outstanding, or to

be created in connection with the offering, and the amount of those options

held or to be held by each person required to be named in subdivisions (2),

(4), (5), (6), or (8) of this subsection and by any person that holds or will

hold 10 percent or more in the aggregate of those options;

(11) the dates

of, parties to, and general effect concisely stated of each managerial or other

material contract made or to be made otherwise than in the ordinary course of

business to be performed in whole or in part at or after the filing of the

registration statement or that was made within the previous two years, and a

copy of the contract;

(12) a

description of any pending litigation, action, or proceeding to which the

issuer is a party and that materially affects its business or assets, and any

litigation, action, or proceeding known to be contemplated by governmental

authorities;

(13) a copy of

any prospectus, pamphlet, circular, form letter, advertisement, or other sales

literature intended as of the effective date to be used in connection with the

offering and any solicitation of interest used in compliance with subdivision

5202(17)(B) of this chapter;

(14) a specimen

or copy of the security being registered, unless the security is

uncertificated; a copy of the issuer's articles of incorporation and bylaws or

their substantial equivalents, in effect; and a copy of any indenture or other

instrument covering the security to be registered;

(15) a signed or

conformed copy of an opinion of counsel concerning the legality of the security

being registered, with an English translation if it is in a language other than

English, which states whether the security when sold will be validly issued,

fully paid, and nonassessable and, if a debt security, a binding obligation of

the issuer;

(16) a signed or

conformed copy of a consent of any accountant, engineer, appraiser, or other

person whose profession gives authority for a statement made by the person, if

the person is named as having prepared or certified a report or valuation,

other than an official record, that is public, which is used in connection with

the registration statement;

(17) a balance

sheet of the issuer as of a date within four months before the filing of the

registration statement; a statement of income and a statement of cash flows for

each of the three fiscal years preceding the date of the balance sheet and for

any period between the close of the immediately previous fiscal year and the

date of the balance sheet, or for the period of the issuer's and any

predecessor's existence if less than three years; and, if any part of the

proceeds of the offering is to be applied to the purchase of a business, the

financial statements that would be required if that business were the

registrant; and

(18) any

additional information or records required by rule adopted or order issued

under this chapter.

(c) A

registration statement under this section becomes effective 30 days, or any

shorter period provided by rule adopted or order issued under this chapter,

after the date the registration statement or the last amendment other than a

price amendment is filed, if:

(1) a stop order

is not in effect, and a proceeding is not pending under section 5306 of this

chapter;

(2) the

Commissioner has not issued an order under section 5306 of this chapter

delaying effectiveness;

(3) the applicant

or registrant and the Commissioner or the Commissioner's designee have not

mutually agreed to delay effectiveness for a specified period of time; or

(4) the

applicant or registrant has not requested that effectiveness be delayed.

(d) The

Commissioner may delay effectiveness once for not more than 90 days if the

Commissioner determines the registration statement is not complete in all

material respects and promptly notifies the applicant or registrant of that

determination. The Commissioner may also delay effectiveness for a further

period of not more than 30 days if the Commissioner determines that the delay

is necessary or appropriate.

(e) A rule

adopted or order issued under this chapter may require as a condition of

registration under this section that a prospectus containing a specified part

of the information or record specified in subsection (b) of this section be

sent or given to each person to which an offer is made, before or concurrently,

with the earliest of:

(1) the first

offer made in a record to the person otherwise than by means of a public

advertisement, by or for the account of the issuer or another person on whose

behalf the offering is being made or by an underwriter or broker-dealer that is

offering part of an unsold allotment or subscription taken by the person as a

participant in the distribution;

(2) the

confirmation of a sale made by or for the account of the person;

(3) payment

pursuant to such a sale; or

(4) delivery of

the security pursuant to such a sale. (Added 2005, No. 11, § 1, eff. July 1,

2006.)
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