AB 2610, as introduced, Holden. Securities: qualification.
Existing law, the Corporate Securities Law of 1968, requires securities offered or sold in this state in an issuer transaction to be qualified through an application filed with the Commissioner of Business Oversight, unless exempt from the qualification requirements. Existing law generally provides that every qualification under these provisions is effective for 12 months from its effective date. Existing law makes it unlawful for a person in connection with the offer, sale, or purchase of a security to engage in fraudulent or misleading acts or omissions.
This bill would increase that effective period of qualification from 12 months to 36 months unless an issuer makes a change to its board members, directors, officers, partners, members, or trustees, in which case the qualification would become ineffective, as provided.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 25114 of the Corporations Code is
2amended to read:
begin deleteEvery end deletebegin insert(a)end insertbegin insert end insertbegin insertSubject to the limitations in subdivisions (b)
2and (c), every end insertqualification under this chapter is effective forbegin delete 12end delete
3begin insert 36end insert months from its effective date, unless the commissioner by
4order or rule specifies a different period, except during the time
5an order under Section 25140 or subdivision (a) of Section 25143
6is in effect.
7(b) (1) Any qualification under this chapter immediately
8becomes ineffective upon any change in board members, directors,
9officers, partners, members, or trustees of the issuer.
10(2) If any of the changes specified in paragraph (1) occur, an
11issuer shall reapply for qualification pursuant to this chapter. If
12a qualification becomes ineffective pursuant to paragraph (1) but
13the issuer subsequently successfully obtains qualification for the
14securities, then that qualification shall only remain effective for
15the same period of time as the original qualification issued
16pursuant to subdivision (a).
17(c) The provisions of this section shall not change the
18qualification requirements of Sections 25111, 25112, or 25113.
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