3 AAC 08.190 - Impoundment of proceeds
(a) If an offering
is not firmly underwritten, the administrator will, in the administrator's
discretion, require, as a condition of registration, that a specific minimum
amount of proceeds from a sale of securities be impounded to assure receipt of
necessary money to finance the proposed undertaking as described in the
application.
(b) If the
administrator orders an impoundment agreement, the proceeds from the sale of
the securities must be deposited in an interest bearing escrow or trust account
under an impoundment agreement with an impoundment agent. The impoundment agent
may not be affiliated with the issuer, the issuer's affiliates, the issuer's
officers or directors, the issuer's underwriters, or any promoter.
(c) The impoundment agreement must be signed
by an officer of the issuer, an officer of the underwriter, if applicable, and
an officer of the impoundment agent, who must each warrant that they have the
authority to sign the documents. A signed copy of the agreement must be filed
with the administrator and, together with a summary of the principal terms of
the agreement, becomes part of the registration statement.
(d) The impoundment agreement must provide
that the impounded proceeds are not subject to claims by creditors until the
proceeds have been released to the issuer and that the administrator has the
right to inspect and make copies of the records of the impoundment agent at any
reasonable time wherever the records are located. For purposes of this
subsection, "creditors" means creditors of the
(1) issuer;
(2) issuer's affiliates;
(3) issuer's associates; or
(4) underwriters of the issuer's
offering.
(e) The
impoundment agent shall notify the administrator in writing upon the release of
the proceeds. If the proceeds are insufficient to attain, within the time
prescribed by the impoundment agreement, the minimum amount of proceeds set
under 3 AAC 08.135(f),
the impoundment agent shall release and return the proceeds directly to the
investors without deduction for expenses, including impoundment agent fees, and
shall distribute all interest earned pro rata to the investors along with the
proceeds.
(f) If a person who is an
underwriter for the issuer's offering or an officer, director, promoter,
affiliate, or associate of the issuer purchases securities that are a part of
the public offering being sold under the registration statement, and if the
proceeds from that purchase are used to attain the minimum amount of proceeds
set under 3 AAC 08.135(f),
(1) the purchase of the securities must be on
the same terms as purchases by unaffiliated public investors; and
(2) the prospectus must contain a disclosure
that those persons may purchase securities of the issuer for purposes of
completing the impoundment requirements imposed by this section.
Notes
Authority:AS 45.55.110
AS 45.55.950
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