• Summary date: Feb 10 2015 - More information

    Adds new GS 78A-17A,Intrastate private capital exemption, to Article 3 (Exemptions) of GS Chapter 78A. Defines the following terms as they apply in this section: (1) accredited investor, (2) disclosure brochure, (3) non-accredited investor, (4) qualified North Carolina private company, (5) qualified North Carolina resident investor, and (6) qualified security.

    Exempts the offer or sale of a security by an issuer from the registration requirements of GS Chapter 78A, Article 4 (Registration and Notice Filing Procedures of Securities). Also exempts any seller who represents an issuer in an offer or sale from the registration requirements of GS Chapter 78A, Article 5 (Registration of Dealers and Salesmen). Conditions the receipt of the exemptions from the registration requirements under Article 4 and 5 on the meeting of ten requirements as specified in subsection (b) of new GS 78A-17A. The ten requirements include that a North Carolina non-accredited investor has not invested more than $5,000 in a single North Carolina qualified company per year; that the transaction meets the requirements of the federal exemption for intrastate offerings (as specified); and that the issuer informs all purchasers in writing that the securities have not been registered and may be restricted for sale.

    Authorizes the North Carolina Securities Division of the Department of the Secretary of State to adopt rules to carry out and enforce the provisions of new GS 78A-17A, and to register and regulate intrastate regional private equity fund companies, under the rules contained in Title II of the JOBS Act of 2012 and Regulation D Rule 506(c).

    Directs the North Carolina Securities Administrator to prepare a disclosure brochure form suitable for use in conformity with this section. Requires the disclosure brochure to require an investor to state whether the investor is accredited or non-accredited.

    Provides that the anti-fraud requirements of Rule 206(4)-8 under the Investment Advisers Act of 1940 and the anti-fraud provisions of GS Chapter 78A apply to investment advisers to private equity fund companies. Also provides that GS 78A-8, Sales and Purchases, and GS 78A-56(a)(2), Civil Liabilities, apply to this section.

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