2006 Code of Virginia § 13.1-508 - Registration by notification

13.1-508. Registration by notification.

A. The following securities may be registered by notification:

1. Any security whose issuer (which, for the purposes of this subsection,shall include any predecessor by merger, consolidation or acquisition ofassets) has been in continuous operation for at least five years if there hasbeen no default within the past three fiscal years in the payment ofprincipal, interest or dividends on any security of the issuer with a fixedmaturity or a fixed interest or dividend provision, and (where the securitybeing registered does not have a fixed maturity or a fixed interest ordividend provision) (a) the issuer is a corporation which has assets of atleast $500,000 after deduction of depreciation and other reserves, which hasa net worth of at least $10,000, which is incorporated under the laws of thisCommonwealth and which conducts a substantial portion of its business in thisCommonwealth, or (b) the issuer during its past three fiscal years has hadaverage net earnings applicable to all securities without a fixed maturity ora fixed interest or dividend provision (whether of one or more classes)outstanding at the date when the registration statement is filed (i)aggregating at least five percent of the amount of such outstandingsecurities as measured by their maximum public offering price or their marketprice on a day within 30 days of the date of filing the registrationstatement, whichever is higher, or their book value on a day within 90 daysof the date of filing the registration statement if there is neither areadily determinable market price nor a public offering price or (ii) if nosuch securities are outstanding, then aggregating at least five percent ofthe amount of such securities then offered for sale based upon the maximumprice at which such securities are to be offered for sale; and all accountingdeterminations required by this section shall be made in accordance withgenerally accepted accounting practices. Noncumulative preferred stock shallbe deemed for the purposes of this subsection a security with a fixeddividend provision.

2. Any security registered for nonissuer distribution if (i) any security ofthe same class has ever been registered or (ii) the security being registeredwas originally issued pursuant to an exemption in this chapter.

B. A registration statement under this section shall state the facts showingeligibility of the securities for registration by notification, the amountand maximum offering price of the securities proposed to be offered in thisCommonwealth, and a copy of any prospectus to be used in connection with theoffering. It shall be accompanied by a fee of 1/20 of one percent of themaximum offering price of the securities proposed to be offered in thisCommonwealth; provided that the fee shall not be less than $100 nor more than$250.

C. If no stop order is in effect and no proceeding for the issuance of a stoporder is pending, a registration statement under this section shallautomatically become effective at three o'clock in the afternoon of thesecond full business day after filing of the registration statement or thelast amendment thereto or at such earlier time as the Commission maydetermine by order, letter, telegram, or electronic means.

D. The Commission may require that a prospectus be used in connection withthe offering. If the Commission requires the use of a prospectus, it shall beunlawful to sell any security registered under this section except upondelivery of a prospectus to each person to whom an offer is made. Theprospectus shall contain such information specified in subsection (b) of 13.1-510 as may be designated by the Commission as necessary for theprotection of investors and such additional information as the Commission mayrequire.

(1956, c. 428; 1981, c. 168; 1984, c. 771; 1993, c. 179; 2003, c. 595.)