ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature

First Regular Session

House: COM DP 10-0-0-0

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal Note

HB 2048: sales of securities; definition

Sponsor: Representative Kolodin, LD 3

Caucus & COW

Overview

Modifies the definition of offer to sell or offer for sale in the context of the sale of securities.

History

The Arizona Corporation Commission (ACC) regulates securities in Arizona through the registration of securities being offered or sold and the registration of dealers who sell, purchase or offer to sell or buy securities in Arizona. The sale of a federal covered security that complies with ACC filing requirements is exempt from the requirement to register securities. Statute also outlines exemptions to dealer registration and ACC filing requirements (Title 44, Chapter 12, A.R.S.).

A security, in general, is any tradeable interest or instrument such as a note, stock, treasury stock, bond, commodity investment contract, commodity option, debenture or evidence of indebtedness. A security must be registered with the ACC, unless it is a covered federal security, and may only be sold by a dealer or salesmen who is registered with the ACC before an offer to sell a security may be made (A.R.S. §§ 44-1814, 44-1842).

Statute defines offer to sell as an attempt or offer to dispose of, or solicitation of an order or offer to buy, a security or interest in a security for value or any sale or offer for sale of a warrant or right to subscribe to another security of the same issuer or of another issuer.  Any sale or offer for sale of a security that gives the holder thereof a present or future right or privilege to convert such security into another security of the same issuer or of another issuer shall be deemed an offer to sell the security to be acquired pursuant to such right or privilege, but the existence thereof shall not be construed as affecting the registration or exemption under this chapter of the security to which it attaches (A.R.S. § 44-1801).

Provisions

1.   Includes, to the definition of offer to sell or offer for sale, an offer, including an offer to sell or offer for sale, occurs only where acceptance of the offer and payment of consideration would complete the sale. (Sec. 1)

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5.                     HB 2048

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