Chapter 18 NCAC 06A

18 NCAC 06A .1104 DEFINITIONS As used in this Chapter, the following terms mean: (1) "Act" shall mean the North Carolina Securities Act, Chapter 78A of the North Carolina General Statutes, as same has been or may be from time to time amended. (2) "Commercial Paper," as referred t…

SECTION .1200 - EXEMPTIONS 18 NCAC 06A .1201 DESIGNATED SECURITIES EXCHANGES (REPEALED) History Note: Authority G.S. 78A-16(8); Eff. April 1, 1981; Amended Eff. May 1, 1995; Repealed Eff. September 1, 2008.

18 NCAC 06A .1202 RECOGNIZED SECURITIES MANUALS (a) The publications recognized by the administrator as securities manuals for the purposes set forth in G.S. 78A-17(2)a. shall be: (1) Standard and Poor's Corporation Records, (2) Mergent's Industrial Manual, (3) Mergent's Over-the…

18 NCAC 06A .1203 INFORMATION FILED BY REGISTERED DEALER The exemption for nonissuer distributions, other than by a controlling person of an outstanding security, under G.S. 78A-17(2)b. shall be applicable to the offer and sale of any security, the issuer of which is required to …

18 NCAC 06A .1204 LIMITED OFFERINGS (REPEAled) History Note: Filed as a Temporary Repeal Eff. October 1, 1983, for a Period of 120 Days to Expire on January 29, 1984; Authority G.S. 78A-17(9)(a); 78A-18; 78A-49(a); Eff. April 1, 1981; Repealed Eff. January 1, 1984.

18 NCAC 06A .1205 LIMITED OFFERINGS PURSUANT TO G.S. 78A-17(9) (a) Any issuer relying upon the exemption provided by G.S. 78A-17(9) in connection with an offering of a security made in reliance upon Rule 505 of Regulation D promulgated by the Securities and Exchange Commission un…

18 NCAC 06A .1206 LIMITED OFFERING EXEMPTION PURSUANT TO G.S. 78A-17(17) History Note: Authority G.S. 78A-17(17); 78A-49(a); 78A-56; Eff. January 1, 1984; Temporary Rule Eff. October 1, 1983, for a period of 120 days to expire on January 29, 1984; Amended Eff. September 1, 1990; …

18 NCAC 06A .1207 DISQUALIFICATIONS FROM RELIANCE UPON CERTAIN EXEMPTIONS (a) No exemption under G.S. 78A-17(17) or any rule promulgated thereunder, G.S. 78A-16(9), or any other exemption made by rule subject to the disqualifications of this Rule .1207 shall be available for the …

18 NCAC 06A .1208 TRANSACTIONS EXEMPT UNDER RULE .1206: FILING REQUIREMENTS History Note: Authority G.S. 78A-17(17); 78A-49(a); Eff. January 1, 1984; Temporary Rule Eff. October 1, 1983, for a Period of 120 Days to Expire on January 29, 1984; Amended Eff. September 1, 1990; Octob…

18 NCAC 06A .1209 NONPROFIT SECURITIES (a) The exemption provided by G.S. 78A-16(9) from the registration requirements of G.S. 78A-24 for securities offered, or to be offered, and sold by any person operated not for private profit but exclusively for religious, educational, benev…

18 NCAC 06A .1210 SECURITIES EXCHGS/AUTO QUOTATION SYS APPROVED/ADMINISTRATOR For purposes of G.S. 78A-16(15), the following securities exchanges and automated quotation systems are approved provided such exchanges or systems comply with the provisions of Paragraphs (1) through (…

18 NCAC 06A .1211 NOTICE FILING PROCEDURES FOR RULE 506 OFFERINGS An issuer offering a security that is a "covered security" under Section 18(b)(4)(D) of the Securities Act of 1933 shall file a notice on SEC Form D, a consent to service of process on a form prescribed by the Admi…

18 NCAC 06A .1212 NOTICE FILING PROCEDURES FOR OFFERINGS OF INVESTMENT COMPANY SECURITIES (a) In lieu of filing a copy of the federal registration statement, an investment company offering securities covered under Section 18(b)(2) of the Securities Act of 1933, as amended, may sa…

18 NCAC 06A .1213 TRANSACTIONAL EXEMPTION PURSUANT TO G.S. 78A-17(19) Conditions of Eligibility for Exemption. For the purposes of eligibility for the exemption provided at G.S. 78A-17(19), an offer or sale of any viatical settlement contract or any fractionalized or pooled inter…

SECTION .1300 - REGISTRATION OF SECURITIES 18 NCAC 06A .1301 REGISTRATION BY NOTIFICATION Application for registration by notification shall be filed with the administrator using the Uniform Application to Register Securities (Form U-1). Supplemental information demonstrating eli…

18 NCAC 06A .1302 REGISTRATION BY COORDINATION Application for registration by coordination shall be filed with the administrator using the Uniform Application To Register Securities (Form U-1). Documents necessary to establish eligibility for registration by coordination shall b…

18 NCAC 06A .1303 REGISTRATION BY QUALIFICATION (a) Application for registration by qualification shall be filed with the administrator using the Uniform Application To Register Securities (Form U-1). Documents necessary to establish eligibility for registration by qualification …

18 NCAC 06A .1304 SECURITIES REGISTRATION AND FILING FEES (a) All fees are payable to the Office of the Secretary of State and shall be submitted with the application for original, renewal, or additional registration. The filing fee shall be retained by the administrator in all c…

18 NCAC 06A .1305 SPONSORSHIP BY DEALER (a) Except where the conditions of G.S. 78A-2(2)d.3. or 78A-2(2)d.4. are met, no securities will be considered for registration unless the application therefor is sponsored by a North Carolina registered dealer with a statement of its desir…

18 NCAC 06A .1306 CONFIRMATION OF REGISTRATION Registrations are effective upon confirmation in writing by the administrator and shall remain effective until the offering is completed, unless a stop order is in effect. It is recommended that a dealer make no sales or related tran…

18 NCAC 06A .1307 COMMISSIONS AND EXPENSES (a) The aggregate amount of all payments including commissions, compensation, discounts, fees, remuneration, mark-ups, and service charges paid or to be paid, directly or indirectly, to underwriters, dealers, salesmen and finders with re…

18 NCAC 06A .1308 ADVERTISING (a) For the purposes of this Rule, "Advertising" shall mean any of the following to be used or circulated with the sale and promotion of a public offering of securities: advertisement; display; pamphlet; brochure; letter; article or communication pub…

18 NCAC 06A .1309 ADVERTISEMENTS NOT DEEMED PROSPECTUS: ETC. (repealed) History Note: Authority G.S. 78A-49(a); Eff. April 1, 1981; Repealed Eff. January 1, 1984.

18 NCAC 06A .1310 OFFERING PRICE (a) A waiver of the two-day advance filing of the final offering price requirement of G.S. 78A-26(c)(iii) shall be permitted if the final pricing information is furnished to the administrator contemporaneously with notice of the Securities and Exc…

18 NCAC 06A .1311 SHELF REGISTRATIONS (repealed) History Note: Authority G.S. 78A-49(a); Eff. April 1, 1981; Repealed Eff. January 1, 1984.

18 NCAC 06A .1312 REGISTRATION OF REAL ESTATE SECURITIES (repealed) History Note: Authority G.S. 78A-49(a); Eff. April 1, 1981; Amended Eff. January 1, 1984; Repealed Eff. October 1, 1988.

18 NCAC 06A .1313 REGISTRATION OF DIRECT PARTICIPATION PROGRAM SECURITIES (a) As a condition to the registration of direct participation program securities, the issuer or dealer(s) effecting sales of such securities pursuant to such registration shall: (1) deliver to each offeree…

18 NCAC 06A .1314 ESCROW AGREEMENTS Where, as a condition to registration of a security in North Carolina, an escrow agreement is required, such agreement shall provide that all funds shall be returned immediately to the investors in full, without reduction of any fees, commissio…

18 NCAC 06A .1315 NOTICE OF COMPLETION OF OFFERING/FINAL SALES REPORT Each issuer shall provide to the administrator, within thirty days of completion of the offering of registered securities, the following information: (1) Date of completion of the offering; (2) Aggregate offeri…

18 NCAC 06A .1316 LEGENDS REQUIRED (a) The information required by this Rule .1316 shall be printed in capital letters in bold-face roman type at least as high as ten-point modern type, and at least two points leaded. (1) The following information shall appear on the cover page o…

18 NCAC 06A .1317 AMENDMENT OF FILINGS Where any information in or exhibits attached to a registration statement is amended in any way subsequent to the filing of such statement, the applicant shall file with the administrator in a timely fashion a copy of such registration state…

18 NCAC 06A .1318 AUTOMATIC WITHDRAWAL OF APPLICATION FOR REGISTRATION Where an application for registration of a security has remained pending for at least one year following the date of its filing, and the delay in completion of its examination by the administrator is due to a …

18 NCAC 06A .1319 required disclosures: viatical settlement contracts (a) Disclosures Prior to Payment of Consideration. On or before the date the viatical settlement purchaser remits consideration pursuant to the purchase agreement, the purchaser shall be provided with the follo…

18 NCAC 06A .1320 VIATICAL SETTLEMENT CONTRACT SUITABILITY REQUIREMENTS (a) Suitability Standards. Sales of viatical settlement contracts may be made only to either accredited investors as defined in 17 C.F.R. 230.501(a), (and as subsequently amended) or to qualified institutiona…

section .1400 - REGISTRATION OF DEALERS AND SALESMEN 18 NCAC 06A .1401 APPLICATION FOR REGISTRATION OF DEALERS (a) The application for registration as a dealer shall contain the following: (1) an executed Uniform Application for Registration as a Dealer (Form BD) and the appropri…

18 NCAC 06A .1402 APPLICATION FOR REGISTRATION OF SALESMEN (a) The application for registration as a salesman shall contain the following: (1) an executed Uniform Application for Securities and Commodities Industry Representative and/or Agent (Form U-4) or the appropriate success…

18 NCAC 06A .1403 TERMINATION OF REGISTRATION OF DEALER (a) When a dealer seeks to terminate registration, notice shall be filed with the administrator on the Uniform Notice of Termination of a Broker-Dealer (Form BDW) or the appropriate successor form accompanied by any outstand…

18 NCAC 06A .1404 CHANGE IN NAME OF DEALER Where only a change in the name of the dealer applicant or registrant occurs, an amended Form BD shall be filed with the administrator together with any amendments to the organizational documents, or accompanying letters of explanation, …

18 NCAC 06A .1405 DEALER MERGER/CONSOLIDATION/ACQUISITION/SUCCESSION (a) When there is a merger, consolidation, acquisition, succession, or other fundamental change the surviving or new entity shall file with the administrator, prior to such fundamental change, an amended Form BD…

18 NCAC 06A .1406 EXPIRATION AND RENEWAL OF DEALER REGISTRATION (a) A dealer registration shall expire on December 31 of each year unless timely renewed. (b) A NASD member firm shall renew according to NASAA/NASD Central Registration Depository procedures. (c) A non-NASD member f…

18 NCAC 06A .1407 EXPIRATION AND RENEWAL OF SALESMAN'S REGISTRATION A salesman's registration shall expire on December 31 of each year unless renewed. A dealer shall file the following at least 15 days before the expiration date to renew its salesmen's registration: (1) Dealers t…

18 NCAC 06A .1408 TERMINATION OF SALESMAN'S REGISTRATION (a) When a salesman withdraws, cancels or otherwise terminates registration, the dealer for which the salesman is registered shall file such information, as follows: (1) A Uniform Termination Notice For Securities Industry …

18 NCAC 06A .1409 TRANSFER OF SALESMAN'S REGISTRATION History Note: Authority G.S. 78A-36(b); 78A-49(a); Eff. April 1, 1981; Amended Eff. November 1, 1982; Legislative Objection Lodged Eff. February 1, 1983; Curative Amended Eff. February 1, 1983; Amended Eff. September 1, 1995; …

18 NCAC 06A .1410 MINIMUM FINANCIAL REQUIREMENTS FOR DEALERS (a) Each dealer registered or required to be registered under this Act shall comply with SEC Rules 15c3-1, 15c3-2, and 15c3-3 (17 C.F.R. 240.15c3-1, 17 C.F.R. 240.15c3-2, and 17 C.F.R. 240.15c3-3), as amended from time …

18 NCAC 06A .1411 RECORD KEEPING REQUIREMENTS FOR DEALERS (a) Unless otherwise provided by order of the Securities and Exchange Commission, each dealer registered or required to be registered under this Act shall make, maintain and preserve books and records in compliance with U.…

18 NCAC 06A .1412 FINANCIAL STATEMENTS Each dealer registered or required to be registered under this Act shall comply with SEC Rule 17a-11 (17 C.F.R. 240.17a-11), as amended from time to time, and shall file with the Administrator upon request copies of notices and reports requi…

18 NCAC 06A .1413 SALESMAN EXAMINATION REQUIRED (a) Every application for registration as a salesman shall show evidence of a minimum passing grade of seventy percent on either: (1) the Uniform Securities Agent State Law Examination (USASLE - Series 63); or (2) both the Uniform C…