| R14-4-102 R14-4-102. Exempt Transactions - Restricted Public Offering A. An offering of securities within or from Arizona made to not
more than 10 persons is added to the class of transactions exempt
under A.R.S. § 44-1844. An
issuer relying on this Section shall comply with all of the following
conditions.
1. The aggregate amount of all offerings made by an issuer under
this exemption within or from Arizona shall not exceed $100,000.
2. The issuer shall pay no commission or remuneration of any kind,
other than transfer agent’s fees, directly or indirectly, to any
person in connection with the distribution or sale of such securities.
3. At least 10 business days before the offering is made, the
issuer shall file with the Commission a verified statement of the
details and purposes of the offering and the financial condition of
the issuer. The issuer
shall not make any material change in the details of the offering
without the Commission’s consent.
4. The issuer shall obtain Commission approval of any subscription
contract calling for deferred payments.
5. An issuer that is not domiciled in Arizona or is not
incorporated under the laws of this state, shall file a consent to
service (Uniform Form U-2) with
the verified statement prescribed in subsection (3) above.
6. The issuer and any person acting on its behalf shall reasonably
believe prior to making any sale that the investment is suitable for
the purchaser. For the
limited purpose of this condition only, the investment is deemed
suitable if it does not exceed 20% of the investor’s net worth
(excluding principal residence, furnishings therein, and personal
automobiles). B. This exemption shall not apply to an offering made in
connection with or integrated with an offering otherwise subject to
A.R.S. §§ 44-1841 and 44-1842.
This Section is not available to any issuer for any transaction
or any chain of transactions that, although in technical compliance
with the Section, is part of a plan or scheme to evade the
registration provisions of the Securities Act of Arizona. C. The same issuer may file successive notices under this Section
until the total amount encompassed in such filings equals $100,000. D. The verified statement is not a prescribed form, but shall be
executed by an authorized officer of the issuer whose signature shall
be verified under oath and shall include all of the following:
1. The title, “Notice of Intention to Sell Securities Under
A.A.C. R14-4-102.”
2. In the caption, the issuer’s full name, the issuer’s type
of organization, and the state in which the issuer was organized.
3. The details and purposes of the offering, including but not
limited to a description of the securities to be sold, the number of
units and selling price per unit, the method of offering, and the
allocation of proceeds.
4. A statement of financial condition prepared in accordance with
R14-4-123.
5. A recitation of
the facts clearly indicating that all conditions affecting eligibility
for exemption exist.
6. A statement that the issuer has taken appropriate action to
authorize the issuance of securities.
7. The issuer’s principal business address and mailing address
if different from the principal business address.
8. Below the verification of signature, the following form for
acknowledgment by the Commission: “Receipt
of the foregoing Notice of Intention to Sell Securities is
acknowledged as of the date indicated.
The Commission enters no objection to the offering described
therein, and such offering may be commenced __________, 20____.
ARIZONA CORPORATION COMMISSION
Securities Division ______________” E. Filing of notice, exhibits, and fee:
1. The issuer shall file 2 originally executed copies of the
verified statement, except that only 1 copy of the financial statement
is required if such statement is attached to, rather than included in,
the instrument. The
Commission shall acknowledge 1 copy of the verified statement and
return it to the issuer as evidence of filing.
2. The issuer shall file 1 copy of any subscription form or
written material describing, or to be used in connection with, the
offering.
3. The issuer shall file a nonrefundable fee as prescribed by
A.R.S. § 44-1861(G). F. The Commission may deny or revoke this exemption to any issuer
for the reasons listed in A.R.S. §§ 44-1921(1) through (6).
The Securities Division shall notify the issuer of such denial
or revocation. Such
notice shall be given by certified mail. G.
This exemption shall be effective for 1 year from the date the
Director acknowledges the Notice of Intention to Sell Securities. Historical
Note Former
Order S-2; Amended effective May 16, 1978 (Supp. 78-3). |
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