O.C.G.A. § 10-5-24 — Filing of registration statement; conditions of registration; amendment

(a) A registration statement may be ﬁled by the issuer, a person on whose behalf the offering is to be made, or a broker-dealer registered under this chapter. (b) If a registration statement is withdrawn before the effective date or a pre-effective stop order is issued under Code Section 10-5-25, the Commissioner shall retain the fee. (c) A registration statement ﬁled under Code Section 10-5-22 or 10-5-23 must specify: (1) The amount of securities to be offered in this state; (2) The states in which a registration statement or similar record in connection with the offering has been or is to be ﬁled; and (3) Any adverse order, judgment, or decree issued in connection with the offering by a state securities administrator, the Securities and Exchange Commission, or a court. (d) A record ﬁled under this chapter or the predecessor Act within ﬁve years preceding the ﬁling of a registration statement may be incorporated by reference in the registration statement to the extent that the record is currently accurate. (e) In the case of a nonissuer distribution, information or a record shall not be required under subsection (i) of this Code section or under Code Section 10-5-23, unless it is known to the person ﬁling the registration statement or to the person on whose behalf the distribution is to be made or unless it can be furnished by those persons without unreasonable effort or expense. (f) A rule adopted or order issued under this chapter may require as a condition of registration that a security issued within the previous 754 10-5-24 ﬁve years or to be issued to a promoter for a consideration substantially less than the public offering price or to a person for a consideration other than cash be deposited in escrow; and that the proceeds from the sale of the registered security in this state be impounded until the issuer receives a speciﬁed amount from the sale of the security either in this state or elsewhere. The conditions of any escrow or impoundment required under this subsection may be established by rule adopted or order issued under this chapter, but the Commissioner may not reject a depository institution solely because of its location in another state. (g) A rule adopted or order issued under this chapter may require as a condition of registration that a security registered under this chapter be sold only on a speciﬁed form of subscription or sale contract and that a signed or conformed copy of each contract be ﬁled under this chapter or preserved for a period speciﬁed by the rule or order, which may not be longer than ﬁve years. (h) Except while a stop order is in effect under Code Section 10-5-25, a registration statement is effective for one year after its effective date or for any longer period designated in an order under this chapter during which the security is being offered or distributed in a nonexempted transaction by or for the account of the issuer or other person on whose behalf the offering is being made or by an underwriter or broker-dealer that is still offering part of an unsold allotment or subscription taken as a participant in the distribution. For the purposes of a nonissuer transaction, all outstanding securities of the same class identiﬁed in the registration statement as a security registered under this chapter are considered to be registered while the registration statement is effective. If any securities of the same class are outstanding, a registration statement may not be withdrawn until one year after its effective date. A registration statement may be withdrawn only with the approval of the Commissioner. (i) While a registration statement is effective, a rule adopted or order issued under this chapter may require the person that ﬁled the registration statement to ﬁle reports, not more often than quarterly, to keep the information or other record in the registration statement reasonably current, and to disclose the progress of the offering. (j) A registration statement may be amended after its effective date. The post-effective amendment becomes effective when the Commissioner so orders. A post-effective amendment relates back to the date of the offering of the additional securities being registered if, within one year after the date of the sale, the amendment is ﬁled and the additional registration fee is paid. 755 10-5-25 History. Code 1981, § 10-5-24, enacted by Ga. L. 2008, p. 381, § 1/SB 358. 10-5-25. Denying, suspending, or revoking the effectiveness of registration statement; publication of conduct constituting violations; notice and hearing. (a) The Commissioner may issue a stop order denying effectiveness to, or suspending or revoking the effectiveness of, a registration statement if the Commissioner ﬁnds that the order is in the public interest and that: (1) The registration statement as of its effective date or before the effective date in the case of an order denying effectiveness, an amendment under subsection (j) of Code Section 10-5-24 as of its effective date, or a report under subsection (i) of Code Section 10-5-24 is incomplete in a material respect or contains a statement that, in the light of the circumstances under which it was made, was false or misleading with respect to a material fact; (2) This chapter or a rule adopted or order issued under this chapter or a condition imposed under this chapter has been willfully violated, in connection with the offering, by the person ﬁling the registration statement; by the issuer, a partner, officer, or director of the issuer or a person having a similar status or performing a similar function; by a promoter of the issuer; or by a person directly or indirectly controlling or controlled by the issuer but only if the person ﬁling the registration statement is directly or indirectly controlled by or acting for the issuer; or by an underwriter; (3) The security registered or sought to be registered is the subject of a permanent or temporary injunction of a court of competent jurisdiction or an administrative stop order or similar order issued under any federal, foreign, or state law other than this chapter applicable to the offering, but the Commissioner may not institute a proceeding against an effective registration statement under this paragraph more than one year after the date of the order or injunction on which it is based, and the Commissioner may not issue an order under this paragraph on the basis of an order or injunction issued under the securities act of another state unless the order or injunction was based on conduct that would constitute, as of the date of the order, a ground for a stop order under this Code section; (4) The issuer’s enterprise or method of business includes or would include activities that are unlawful where performed; (5) With respect to a security sought to be registered under Code Section 10-5-22, there has been a failure to comply with the 756 10-5-25 undertaking required by paragraph (4) of subsection (b) of said Code section; (6) The applicant or registrant has not paid the ﬁling fee, but the Commissioner shall void the order if the deﬁciency is corrected; or (7) The offering: (A) Will work or tend to work a fraud upon purchasers or would so operate; or (B) Has been or would be made with unreasonable amounts of underwriters’ and sellers’ discounts, commissions, or other compensation or promoters’ proﬁts or participations or unreasonable amounts or kinds of options; or (C) Is being made on terms that are unfair, unjust, or inequitable. (b) To the extent practicable, the Commissioner by rule adopted or order issued under this chapter shall publish in print or electronically standards that provide notice of conduct that violates paragraph (7) of subsection (a) of this Code section. (c) The Commissioner may not institute a stop order proceeding against an effective registration statement on the basis of conduct or a transaction known to the Commissioner when the registration statement became effective unless the proceeding is instituted within 30 days after the registration statement became effective. (d) The Commissioner may summarily revoke, deny, postpone, or suspend the effectiveness of a registration statement pending ﬁnal determination of an administrative proceeding. Upon the issuance of the order, the Commissioner shall promptly notify each person speciﬁed in subsection (e) of this Code section that the order has been issued, the reasons for the revocation, denial, postponement, or suspension, and that within 30 days after the receipt of a request in a record from the person the matter will be scheduled for a hearing. If a hearing is not requested and none is ordered by the Commissioner within 30 days after the date of service of the order, the order becomes ﬁnal. If a hearing is requested or ordered, the Commissioner, after notice of and opportunity for hearing for each person subject to the order, may modify or vacate the order or extend the order until ﬁnal determination. (e) A stop order may not be issued under this Code section without: (1) Appropriate notice to the applicant or registrant, the issuer, and the person on whose behalf the securities are to be or have been offered; (2) An opportunity for hearing; and 757 T.10, C.5, A.4 (3) Findings of fact and conclusions of law in a record in accordance with Chapter 13 of Title 50, the “Georgia Administrative Procedure Act.” (f) The Commissioner may modify or vacate a stop order issued under this Code section if the Commissioner ﬁnds that the conditions that caused its issuance have changed or that it is necessary or appropriate in the public interest or for the protection of investors. History. Code 1981, § 10-5-25, enacted by Ga. L. 2008, p. 381, § 1/SB 358; Ga. L. 2010, p. 838, § 10/SB 388.