Louisiana Revised Statutes 51:706 – General provisions for registration of securities
Terms Used In Louisiana Revised Statutes 51:706
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Commissioner: means the commissioner of financial institutions who is also the commissioner of securities. See Louisiana Revised Statutes 51:702
- Dealer: means every person, other than a salesman registered under this Part, who engages, either for all or part of his time, directly or indirectly, as agent, broker, or principal in the business of offering, buying, selling, or otherwise dealing or trading in securities issued by another person but does not include:
(i) A bank chartered and issued a certificate of authority by the state of Louisiana and under the supervision of the commissioner of financial institutions, a national bank chartered by the government of the United States and under the supervision of the Comptroller of the Currency of the United States, a bank holding company organized under the laws of the state of Louisiana and under the supervision of the Board of Governors of the Federal Reserve, or the employees of such banks or bank holding companies acting in their official capacity. See Louisiana Revised Statutes 51:702
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Executive officer: means the president, the principal financial officer, the principal operating officer, each vice president with responsibility involving policy-making functions for a significant aspect of a person's business, the secretary, the treasurer, or any other person performing similar functions with respect to any organization, whether incorporated or unincorporated. See Louisiana Revised Statutes 51:702
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Issuer: means every person who issues or proposes to issue any security, except that with respect to certificates of deposit, voting-trust certificates, or collateral-trust certificates or with respect to certificates of interest or shares in an unincorporated investment trust not having a board of directors or persons performing similar functions or in an unincorporated investment trust of the fixed, restricted management, or unit type, the term "issuer" means the person or persons performing the acts and assuming the duties of depositor or manager pursuant to the provisions of the trust or other agreement or instrument under which such securities are issued, except that:
(a) In the case of an unincorporated association which provides by its articles for limited liability of any or all of its members or in the case of a trust, committee, or other legal entity, the trustees or members thereof shall not be individually liable as issuers of any security issued by the association, trust, committee, or other legal entity. See Louisiana Revised Statutes 51:702
- offer: shall include every attempt or offer to dispose of or solicitation of an offer to buy a security or interest in a security for value. See Louisiana Revised Statutes 51:702
- Person: means an individual, a corporation, a partnership, an association, a joint-stock company, a trust where the interest of the beneficiaries is evidenced by a security, or any unincorporated organization. See Louisiana Revised Statutes 51:702
- Prospectus: means any notice, circular, advertisement, sales literature, letter, offering circular, offering sheet, or communication, written or by radio or television, which offers any security for sale or which is used in connection with any such offer or which confirms the sale of any security, except that:
(a) A confirmation of the sale of a security which is sent or given after the effective date of the registration statement shall not be deemed a prospectus if it is proved that prior to or at the same time with such confirmation a written prospectus, meeting the requirements of La. See Louisiana Revised Statutes 51:702
- Securities of the same class: means :
(a) All common stock of an issuer, regardless of varying series or designations, and all securities convertible into common stock or conferring the right to acquire common stock. See Louisiana Revised Statutes 51:702
- Security: means any note; stock; treasury stock; bond; debenture; evidence of indebtedness; certificate of interest or participation in any profit-sharing agreement; collateral-trust certificate; preorganization certificate or subscription; transferable share; investment contract; voting-trust certificate; certificate of deposit for a security; fractional undivided interest in oil, gas, or other mineral rights; any put, call, straddle, option, or privilege on any security, certificate of deposit, or group or index of securities (including any interest therein or based on the value thereof); or, in general, any interest or instrument commonly known as a "security"; or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing. See Louisiana Revised Statutes 51:702
- sell: means and shall include every contract of sale or disposition of a security or interest in a security for value. See Louisiana Revised Statutes 51:702
- Service of process: The service of writs or summonses to the appropriate party.
- State: means any state (or a designated state), territory, or possession of the United States, the District of Columbia, Puerto Rico and the Virgin Islands. See Louisiana Revised Statutes 51:702
A. Every person registering securities pursuant to La. Rev. Stat. 51:705(B), (D), or (E) shall pay to the commissioner a fee of one-tenth of one percentum of the aggregate price of the securities to be registered and offered to be sold in this state, for which the applicant is seeking registration, but in no case shall the fee be less than one hundred dollars nor more than one thousand dollars, and in addition thereto shall pay a charge of two hundred fifty dollars, to be used to defray the expenses of the commissioner. All fees and charges paid in accordance with this Section, whether paid at the time of filing or at the time of renewal, shall be immediately transmitted to the state treasurer for credit to the state general fund, except that the two hundred fifty dollar fee hereinabove provided shall be retained by the commissioner to be used for the enforcement of this Part generally.
B. Every person who proposes to offer in this state a security required to be registered under La. Rev. Stat. 51:705 who has not previously filed with the commissioner an irrevocable consent to service of process in the form prescribed by La. Rev. Stat. 51:718 shall, as a condition of registration, file with the commissioner such a consent.
C. Every offering circular or prospectus used in connection with an offering of securities registered under La. Rev. Stat. 51:705 shall contain the following legend on the cover page thereof in boldface print or capital type: “THESE SECURITIES HAVE BEEN REGISTERED WITH THE SECURITIES COMMISSIONER OF THE STATE OF LOUISIANA. THE SECURITIES COMMISSIONER, BY ACCEPTING REGISTRATION, DOES NOT IN ANY WAY ENDORSE OR RECOMMEND THE PURCHASE OF ANY OF THESE SECURITIES.”
D. In any case where securities are to be registered for sale in this state and where the issuer of such securities has not had any substantial gross revenues from the sale of products or services or any substantial net income from any source for any fiscal year ended during the past three years and has not succeeded and does not intend to succeed to any business which has had any substantial gross revenues from the sale of products or services or any substantial net income from any source for any fiscal year ended during the past three years, the commissioner may by regulation or order require either or both of the following as a condition of registration under this Part:
(1) Except in an offering pursuant to an underwriting agreement under which no securities will be sold unless all securities to be offered are sold, the deposit in escrow of not less than eighty-five percent of the proceeds from the sale of the registered securities until such escrow account contains the amount specified in La. Rev. Stat. 51:705(C)(1)(k).
(2) The deposit in an escrow account for a period not exceeding one year from the termination of effectiveness of the registration statement or any renewal thereof, of:
(a) Any securities of the same class issued or transferred to a person who is an executive officer, director, general partner, or affiliate of the issuer or to any other person authorized to sell such securities for the issuer except a dealer registered under this Part and selling pursuant to an underwriting agreement which is disclosed in the prospectus delivered to each purchaser and still beneficially owned by such person; or
(b) Any securities of the same class as the securities registered which are to be issued to a person specified in Subparagraph (a) of this Paragraph; at a price below the proposed offering price of such securities or for a consideration other than cash. No interest in any security held in such an escrow account shall be offered for sale, sold, assigned or transferred during the term of such escrow account without the written consent of the commissioner.
E. Any document filed under this Part or a predecessor law within five years preceding the filing of a registration statement may be incorporated by reference as an exhibit to any registration statement filed under La. Rev. Stat. 51:705 to the extent that the document is currently accurate.
F. The commissioner may treat any exhibit filed under La. Rev. Stat. 51:705(C)(2)(f) as confidential and not subject to public inspection upon a showing, satisfactory to him, that disclosure of such information or document to the public would be detrimental to the applicant for registration or to the issuer and that confidential treatment is consistent with the public interest.
G. Any registration statement filed under this Part may be withdrawn prior to the effectiveness of such registration statement or the issuance of a preeffective stop order under La. Rev. Stat. 51:707.
H. A registration under La. Rev. Stat. 51:705 shall be effective for twelve months from its effective date. If the securities registered for sale are not sold within twelve months and the applicant desires to continue the offering under substantially the same terms, a renewal registration statement may be filed with the commissioner. Such renewal registration statement shall recite the total number of shares or principal amount of securities sold in this state under the original, together with any renewal, registration and shall in all respects, including currency of information, comply with the requirements for an original registration. The commissioner shall examine applications for renewal by the same standards as for original applications and upon that basis grant or deny the renewal registrations. Such registrations, if granted, shall be effective for a period of twelve months. In lieu of the filing fee prescribed by Subsection A of this Section, the commissioner shall charge a renewal fee in the same amount as was paid under Subsection A of this Section. Successive renewal registration statements may be filed when appropriate. The prospectus delivery requirements of La. Rev. Stat. 51:705(B)(3) shall apply to sales of securities pursuant to a renewal registration.
I.(1)(a) Every issuer which has registered securities for sale in this state under La. Rev. Stat. 51:705(B) and (D) shall:
(i) For a period of twelve months following the effective date of such registration statement or any renewals thereof, file with the commissioner within sixty days of the close of each fiscal quarter of such issuer except the last fiscal quarter of each fiscal year, the following financial statements prepared in accordance with generally accepted accounting principles:
(aa) A consolidated profit and loss statement of the issuer and its subsidiaries for each such fiscal quarter and for the corresponding period of the preceding fiscal year if the issuer or any predecessor was then in existence; and
(bb) Such other financial statements as the commissioner shall, by rule or regulation, require; however, no such financial statements need be filed following termination of such registration statement.
(ii) For a period beginning on the effective date of such registration statement and ending twelve months after the termination date of such registration statement or any renewals thereof, file with the commissioner within ninety days of the close of such issuer’s fiscal year the following financial statements prepared in accordance with generally accepted accounting principles:
(aa) A consolidated balance sheet of the issuer and its subsidiaries as of the end of such fiscal year;
(bb) A consolidated profit and loss statement of the issuer and its subsidiaries for such fiscal year and for the preceding fiscal year if the issuer or any predecessor was then in existence; and
(cc) Such other financial statements as the commissioner may, by rule or regulation, require; however, such financial statements shall be certified by an independent public accountant duly registered and in good standing as such under the laws of the place of his residence or principal office.
(b) If a substantial part of the proceeds of the issue is to be applied to the purchase of any business, the financial statements of the business to be purchased which would be required in Subparagraph (a) of this Paragraph if that business were the issuer; however, if the commissioner finds that certified financial statements are not necessary for the protection of investors and if the financial statements of such business have not been certified during any such three year period or the commissioner finds that the requirement of certified financial statements would cause undue hardship on the issuer or on such business, the commissioner may permit such financial statements not to be certified.
(c) If the issuer does not report its accounts in the normal course of its business on a consolidated basis, then it may furnish in lieu of the consolidated statements required in Subparagraph (a) of this Paragraph, individual statements for it and its majority owned subsidiaries; and, if the business to be purchased described in Subparagraph (b) of this Paragraph does not report its accounts in the normal course of its business on a consolidated basis, then the issuer may furnish in lieu of the consolidated statements required in Subparagraph (b) of this Paragraph individual statements for such business and its majority owned subsidiaries.
(2) Every issuer which has registered securities for sale in this state under La. Rev. Stat. 51:705(E) shall, for a period beginning with the effective date of the registration statement and ending twelve months after the termination date of such registration statement or any renewals thereof, file with the commissioner within ninety days of the close of such issuer’s fiscal year the following financial statements prepared in accordance with generally accepted accounting principles:
(a) A consolidated balance sheet of the issuer and its subsidiaries as of the end of such fiscal year.
(b) A consolidated profit and loss statement of the issuer and its subsidiaries for such fiscal year and for the preceding fiscal year if the issuer or any predecessor was then in existence.
(c) Such other financial statements as the commissioner may, by rule or regulation, require.
(3) A copy of each financial statement filed with the commissioner pursuant to this Subsection shall be delivered with any prospectus required to be delivered pursuant to La. Rev. Stat. 51:705(E)(3).
J.(1) If any registration statement which has become effective under this Part contains a statement of material fact which was untrue on the date such registration statement became effective or if such registration statement fails to state a material fact which, on the date the registration statement became effective, was necessary to make the statements made, in light of the circumstances under which they were made, not misleading, then such registration statement may be amended by filing with the commissioner such information and such changes in any prospectus used in connection with the registration statement as may be necessary to correct such untruth or failure. Such amendment shall be signed by the persons required to sign the original registration statement under La. Rev. Stat. 51:705. Any such amendment shall become effective when the commissioner so orders.
(2) Any prospectus forming part of a registration statement which has become effective under this Part may be supplemented without amending such registration statement by adding information regarding factual developments which occurred after the effective date of such registration statement and by deleting statements of fact which, as a result of such developments, may be misleading or immaterial. If no stop order with respect to the registration statement is in effect, the prospectus, as supplemented, may be used after:
(a) 3:00 p.m. central standard time or central daylight time, whichever is applicable, on the fifth business day after the filing of five copies of the prospectus, as supplemented, with the commissioner; or
(b) Such shorter time as the commissioner may allow.
Acts 1985, No. 722, §1; Acts 2006, No. 544, §1, eff. June 22, 2006.