Texas Vernon's Texas Civil Statutes - Article 581-10. Examination Of Application; Permit
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Art. 581-10. EXAMINATION OF APPLICATION; PERMIT. A.
Commissioner to Examine Application; Grant or Deny.
Upon the filing of an application for qualifying securities
under Section 7A, it shall be the duty of the Commissioner to
examine the same and the papers and documents filed therewith. If
he finds that the proposed plan of business of the applicant appears
to be fair, just and equitable, and also that any consideration
paid, or to be paid, for such securities by promoters is fair, just
and equitable when such consideration for such securities is less
than the proposed offering price to the public, and that the
securities which it proposes to issue and the methods to be used by
it in issuing and disposing of the same are not such as will work a
fraud upon the purchaser thereof, the Commissioner shall issue to
the applicant a permit authorizing it to issue and dispose of such
securities. Should the Commissioner find that the proposed plan of
business of the applicant appears to be unfair, unjust or
inequitable, he shall deny the application for a permit and notify
the applicant in writing of his decision.
B. Permit, Form and Contents; Term and Renewals.
Every permit qualifying securities shall be in such form as
the Commissioner may prescribe, and shall recite in bold type that
the issuance thereof is permissive only, and does not constitute a
recommendation or endorsement of the securities permitted to be
issued. Such permit shall be for a period of one (1) year;
provided, however, that if the securities authorized to be sold are
not sold within the term provided by the permit, a renewal
application may be filed with the Commissioner. Such renewal
application shall recite the total number of shares sold in Texas,
the total number of shares sold elsewhere, total number of shares
outstanding, and shall contain a detailed balance sheet, an
operating statement, and such other information as the Commissioner
may require. The Commissioner shall examine applications for
renewal by the same standards as stated in subsection A of this
section for original applications and upon that basis issue or deny
renewal permits; such permits, if issued, shall be for a period of
one (1) year and be in such form as the Commissioner may prescribe.
The Commissioner shall charge such fees for the issuance of permits
to sell securities as are hereinafter provided. No permit
instrument need be issued if securities are registered under
Sections 7B or C of this Act, but the Commissioner will examine the
registration papers to determine their sufficiency under the
requirements there stated.
C. Use of Permit to Aid Sale of Securities Prohibited. It
shall be unlawful for any dealer, issuer, or agent to use a permit
authorizing the issuance of securities in connection with any sale
or effort to sell any security.
Subsec. C amended by Acts 2001, 77th Leg., ch. 1091, Sec. 2.06, eff.
Sept. 1, 2001.
D. Commissioner's Discretion. In applying the standards of
this Act, the Commissioner may waive or relax any restriction or
requirement in the Board's rules that, in his opinion, is
unnecessary for the protection of investors in a particular case.
Subsec. D added by Acts 1983, 68th Leg., p. 2716, ch. 465, Sec. 4,
eff. Sept. 1, 1983.
Acts 1957, 55th Leg., p. 575, ch. 269, Sec. 10.
Article: 581-3-1 581-4 581-5 581-6 581-7 581-8 581-9 581-10 581-10-1 581-11 581-12 581-12-1 581-13 581-13-1 581-14
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Last modified: August 10, 2007
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