No. 32039 (Amendment): R164-15-2. Notice Filings for Rule 506 Offerings

DAR File No.: 32039
Filed: 10/13/2008, 04:55
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

The rule is being amended in recognition of the amendment of Regulation D of the Securities Act of 1993 by the Securities and Exchange Commission (SEC) to authorize the filing of Form D in electronic format with the SEC through the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) in accordance with EDGAR rules set forth in Regulation S-T as described in Securities and Exchange Commission Securities Act Release No. 8891.

Summary of the rule or change:

The amended rule authorizes an issuer of securities under Regulation D, Rule 506, to file either: 1) Temporary Form D while that form remains in effect through March 15, 2008; or 2) a copy of the notice of sales on Form D filed electronically with the SEC until an electronic filing system acceptable to the Division is implemented that permits the electronic filing of Form D with the Division or its designee. Such a system is currently being developed by the North American Securities Administrator's Association (NASAA). The amendment also clarifies filing requirements related to: 1) manual signatures; 2) consent to service forms; 3) date-of-sale disclosures; and 4) the filing of amendments.

State statutory or constitutional authorization for this rule:

Section 61-1-15.5 and Regulation D of the Securities Act of 1933 (17 CFR 501-508)

Anticipated cost or savings to:

the state budget:

No change--Processing costs and filing fees will remain identical under the Amendment.

local governments:

No change--Local government does not receive or review these types of filings.

small businesses and persons other than businesses:

No change--The amendment provides small businesses with an additional filing option. It does not materially increase compliance costs.

Compliance costs for affected persons:

No change--Time and cost commitments for filers remain materially the same under the amendment.

Comments by the department head on the fiscal impact the rule may have on businesses:

As indicated in the rule summary, no fiscal impact to businesses is anticipated from this rule filing which provides an additional method for the filing of certain documents. Francine Giani, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Commerce
Securities
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316

Direct questions regarding this rule to:

Benjamin N Johnson at the above address, by phone at 801-530-6134, by FAX at 801-530-6980, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

12/01/2008

This rule may become effective on:

12/08/2008

Authorized by:

Keith Woodwell, Director

RULE TEXT

R164. Commerce, Securities.

R164-15. Federal Covered Securities.

R164-15-2. Notice Filings for Rule 506 Offerings.

(A) Authority and purpose.

(1) The Division enacts this rule under authority granted by Sections 61-1-15.5 and 61-1-24.

(2) The rule requires a notice filing within 15 days after the first sale in this state of securities described in Subsection 61-1-15.5(2) and sets forth the filing procedure.

(3) This rule has been amended in recognition of the amendment of Regulation D by the Securities and Exchange Commission (SEC) to authorize the filing of Form D in electronic format with the SEC through the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) in accordance with EDGAR rules set forth in Regulation S-T (17 CFR Part 232) as described in Securities and Exchange Commission Securities Act Release No. 8891.

(4) This rule authorizes an issuer to file Temporary Form D while that form remains in effect or a copy of the notice of sales on Form D filed electronically with the SEC until an electronic filing system acceptable to the Division is implemented that permits the electronic filing of Form D with the Division or its designee.

(B) Definitions

(1) "Division" means the Division of Securities, Utah Department of Commerce.

(2) "NASAA" means the North American Securities Administrators Association, Inc.[

(3) "SEC Form D" means the document, as adopted by the United States Securities and Exchange Commission and in effect on September 1, 1996, as may be amended by the SEC from time to time, entitled "Form D; Notice of Sale of Securities pursuant to Regulation D, Section 4(6), and/or Uniform Limited Offering Exemption", including Part E and the Appendix.]

(C) Filing requirements

(1) An issuer offering a security that is a covered security under section 18(b)(4)(D) of the Securities Act of 1933 must [submit to]file with the Division or its designee, no later than 15 days after the first sale of such federal covered security in this state, [the following:]an initial notice and a filing fee as follows:

(1)(a) [A manually signed notice on SEC Form D;]The issuer shall file an initial notice on SEC Form D. For Purposes of Subsection 61-1-15.5(2), the initial notice on SEC Form D shall consist of either,

(1)(a)(i) the Temporary Form D (17 CFR 239.500T), including Part E and the Appendix, as adopted by the SEC while that form remains in effect from September 15, 2008 through March 15, 2009; or

(1)(a)(ii) a copy of the notice of sales on Form D filed in electronic format with the SEC through the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) in accordance with EDGAR rules set forth in Regulation S-T (17 CFR Part 232) and in effect on September 15, 2008.

(1)(b) [A completed manually signed NASAA Form U-2 - Uniform Consent to Service of Process; and]Regardless of whether the issuer files a notice of sales on Temporary Form D or a copy of the notice of sales on Form D filed in electronic format with the SEC, such form shall be manually signed by a person duly authorized by the issuer;

(1)(c) [A fee as specified in the Division's fee schedule.]If the issuer files a notice on Temporary Form D, it shall also furnish a completed manually signed NASAA Form U-2 - Uniform Consent to Service of Process;

(1)(d) The issuer shall include with the initial notice a statement indicating:

(1)(d)(i) The date of the first sale of securities in the state of Utah; or

(1)(d)(ii) That sales have yet to occur in the state of Utah; and

(1)(e) The issuer shall submit a fee as specified in the Division's fee schedule.

(2) An issuer who has filed a Form U-2 in connection with a previous notice filing need not file another.

(3) An issuer may file an amendment to a previously filed notice of sales on Form D at any time and must file such an amendment to correct a material mistake of fact or error in the previously filed notice of sales on Form D, as soon as practicable after discovery of the mistake or error.

(4) An issuer that files an amendment to a previously filed notice of sales on Form D must provide current information in response to all requirements of the notice of sales on Form D regardless of why the amendment is filed.

 

KEY: mutual funds, securities, securities regulation

Date of Enactment or Last Substantive Amendment: [September 3, 1997]2008

Notice of Continuation: July 30, 2007

Authorizing, and Implemented or Interpreted Law: 61-1-15.5; 61-1-24