Section 45.55.120. Denial, suspension, and revocation of registration.

   (a) The administrator may issue a stop order denying effectiveness to, or suspending or revoking the effectiveness of, a registration statement if the administrator finds that the order is in the public interest and that
        (1) the registration statement as of its effective date or as of any earlier date in the case of an order denying effectiveness, or any amendment under AS 45.55.110(k) as of its effective date, or any report under AS 45.55.110(j) is incomplete in a material respect or contains a statement that was, in the light of the circumstances under which it was made, false or misleading with respect to a material fact;
        (2) a provision of this chapter or a regulation, order, or condition lawfully imposed under this chapter has been wilfully violated, in connection with the offering, by
             (A) the person filing the registration statement;
             (B) the issuer, a partner, officer, or director of the issuer, a person occupying a similar status or performing similar functions, or a person directly or indirectly controlling or controlled by the issuer, but only if the person filing the registration statement is directly or indirectly controlled by or acting for the issuer; or
             (C) any underwriter;
        (3) the security registered or sought to be registered is the subject of an administrative stop order or similar order or a permanent or temporary injunction under another federal or state act applicable to the offering; but the administrator may not
             (A) institute a proceeding against an effective registration statement under this paragraph more than one year from the date of the order or injunction relied on; or
             (B) enter an order under this paragraph on the basis of an order or injunction entered under another state act unless that order or injunction was based on facts that would currently constitute a ground for a stop order under this section;
        (4) the issuer's enterprise or method of business includes or would include activities that are illegal where performed;
        (5) the offering has worked or tended to work a fraud upon purchasers or would so operate;
        (6) the offering has been or would be made with unreasonable amounts of underwriters' and sellers' discounts, commissions, or other compensation, or promoters' profits or participation, or unreasonable amounts of kinds of options;
        (7) when a security is sought to be registered by notification, it is not eligible for that registration;
        (8) when a security is sought to be registered by coordination, there has been a failure to comply with the undertaking required by AS 45.55.090(b)(4); or
        (9) the applicant or registrant has failed to pay the proper filing fee; but the administrator may enter only a denial order under this paragraph and the administrator shall vacate the order when the deficiency is corrected.
   (b) The administrator may not institute a stop-order proceeding against an effective registration statement on the basis of a fact or transaction known to the administrator when the registration statement became effective unless the proceeding is instituted within the next 30 days.
   (c) The administrator may by order summarily postpone or suspend the effectiveness of the registration statement pending final determination of a proceeding under this section.  Upon the entry of the order, the administrator shall promptly notify each person specified in (d) of this section that it has been entered and of the reasons for it and that within 15 days after the receipt of a written request the matter will be set for hearing. If no hearing is requested and none is ordered by the administrator, the order remains in effect until it is modified or vacated by the administrator.  If a hearing is requested or ordered, the administrator, after notice and opportunity for hearing to each person specified in (d) of this section, may modify or vacate the order or extend it until final determination.
   (d) A stop order may not be entered under any part of this section except the first sentence of (c) of this section without
        (1) appropriate prior notice to the applicant or registrant, the issuer, and the person on whose behalf the securities are to be or have been offered;
        (2) opportunity for hearing; and
        (3) written findings of fact and conclusions of law.
   (e) The administrator may vacate or modify a stop order if the administrator finds that the conditions that prompted entry have changed or that it is otherwise in the public interest to do so.

Authorities

45.55.080;45.55.090;45.55.110;45.55.935

Notes

Recent Bills that will modify this

HB 194 AK SECURITIES ACT; PENALTIES; CRT. RULES
SB 108 AK SECURITIES ACT; PENALTIES; CRT. RULES

Implemented As

3 AAC 08.125
3 AAC 08.130
3 AAC 08.135
3 AAC 08.140
3 AAC 08.150
3 AAC 08.160
3 AAC 08.170
3 AAC 08.200
3 AAC 08.210
3 AAC 08.215
3 AAC 08.220
3 AAC 08.222
3 AAC 08.225
3 AAC 08.720
3 AAC 08.930

References

3 AAC 08.230
AS 45.55.080 Registration by notification.
AS 45.55.090 Registration by coordination.
AS 45.55.110 Provisions applicable to registration and notice filings.
AS 45.55.935 Hearings.

History

(Sec. 19 ch 105 SLA 1961; am Sec. 3 ch 55 SLA 1972)