Chapter 8 Part 1 Flashcards
if a regulation is violated, the four basic tools used to enforce the Uniform Securities Act are
- Orders by the Administrator 2. Actions against registration 3. Civil actions 4. Criminal actions
An offer or offer to sell is
the attempt, or solicitation, to dispose of a security for value.
The term sale is considered
any contract or agreement to dispose of a security for value. A sale is the result of a successful offer
jurisdiction refers to
the power to interpret and apply the law or the territorial range of authority to control
An Administrator has jurisdiction over any offer to buy or sell a security that is
made or accepted in her state. An offer is made in a state if the offer is originated in, or directed to and received in, the Administrator’s state .
the USA does not recognize states where securities are
delivered or where the payment for the purchase is made
The USA jurisdiction rule does not recognize the state where mail is
forwarded
Though the offer was directed to Arizona, the client, Ms. Rose, never received the offer in Arizona, so
no offer was made in Arizona
The state Administrator will have jurisdiction over any offer made through a newspaper when the newspaper is published in a state, but there is an exception. lf a newspaper is published in a state and more than
two-thirds of its circulation is outside the publishing state, then an offer was not made in the state–no state Administrator will have jurisdiction over the offer
An offer in a newspaper may only be made in the state in which
the paper is published
If an offer is made using radio or television, the offer is considered lo have been made
only in the state in which the broadcast originates
US phone or mail offer
The state from which it oJiginated and the state to which it is directed (For mail, not the state to which it may be forwarded)
Any security given or delivered with, or as a bonus for, the purchase of a security, which is considered
both an offer and a sale. For example, if an investor buys a bond with a warrant attached, the warrant is a part of the sale, even though an investor did not purchase it separately
The sale of a warrant or right enabling the holder to subscribe to purchase another security is considered an
offer to sell the other security. Stated plainly, since rights and warrants are securities, a sale takes place when the warrant or right is purchased. however, warrants and rights also represent an offer to sell another security
The following actions do NOT involve an offer or sale
A bona fide pledge or loan of stock; An exchange of securities due to a merger, reorganization, or bankruptcy; A stock dividend, if the stockholders do not provide anything of value in return