Many businesses seek additional financing from time to time.
One area of concern relates to federal and state securities laws. If the securities laws apply, a business may face a maze of legal and regulatory burdens. If they are violated, a business and its principals may face substantial civil, administrative, and even criminal sanctions. Because of increased enforcement efforts by the North Carolina Secretary of State and continuing enforcement efforts by the SEC, it is imperative that a business understand when the securities laws will apply to a transaction. Certain registration and disclosure requirements then may apply.