02-032 C.M.R. ch. 523, § 4 - Eligibility to Register Securities Pursuant to This Rule

Securities may only be registered pursuant to this rule if:

(1) They meet the requirements set forth in Rule 504 and 32 M.R.S. §16304(6-A); and

(2) Neither the issuer nor any of its officers or directors (or the functional equivalents thereof for an entity having no officers or directors), beneficial owners of ten percent or more of its then outstanding voting stock or voting equity interests, promoters, or selling agents, or any officer, director or partner (or the functional equivalents thereof) of any selling agent, is disqualified as a result of one or more of the following:

(i) Has been convicted, within ten years before such sale (or five years, in the case of the issuer, their predecessors and affiliated issuers) of any felony or misdemeanor:

(A) In connection with the purchase or sale of any security;

(B) Involving the making of any false filing with the Administrator or the Securities and Exchange Commission; or

(C) Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchases of securities.

(ii) Is subject to any order, judgment, or decree of any court of competent jurisdiction, entered within five years prior to the filing of the registration statement for the offering, that, at the time of such filing, restrains or enjoins such person from engaging or continuing to engage in any conduct or practice:

(A) In connection with the purchase or sale of any security;

(B) Involving the making of any false filing with the Administrator or the Securities and Exchange Commission;

(C) Arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities dealer, investment adviser or paid solicitor of purchases of securities; or

(D) Adjudicating a United States Postal Service fraud order.

(iii) Is subject to a final order of a state securities commission (or an agency or officer of a state performing like functions); a state authority that supervises or examines banks, savings associations or credit unions; a state insurance commission (or an agency or officer of a state performing like functions); an appropriate federal banking agency; the Securities and Exchange Commission or a self-regulatory organization; the United States Commodity Futures Trading Commission; or the National Credit Union Administration that:

(A) At the time of the sale of securities, bars the person from:

(1) Association with an entity regulated by such commission, authority, agency, or officer;

(2) Engaging in the business of securities, insurance or banking; or

(3) Engaging in savings association or credit union activities; or

(B) Constitutes a final order based on a violation of law or regulation that prohibits fraudulent, manipulative, or deceptive conduct entered within ten years before such sale.

(iv) At the time of the sale is suspended or expelled from membership in, or suspended or barred from association with a member of, a registered national securities exchange or a registered national or affiliated securities association for any act or omission to act constituting conduct inconsistent with just and equitable principles of trade.

(v) Has filed (as a registrant or issuer), or was named as an underwriter in, any registration statement or other offering statement filed with the Administrator or the Securities and Exchange Commission that , within five years before such sale, was the subject of a refusal order, stop order, or order suspending the registration or offering statement, or is, at the time of such sale, the subject of an investigation or proceeding to determine whether a stop order or suspension order should be issued.

(vi) Is subject to a United States Postal Service false representation order entered within five years before such sale, or is, at the time of such sale, subject to a temporary restraining order or preliminary injunction with respect to conduct alleged by the United States Postal Service to constitute a scheme or device for obtaining money or property through the mail by means of false representations.

Notes

02-032 C.M.R. ch. 523, § 4