Illinois Administrative Code › Title 14 - COMMERCE › Part 130 - REGULATIONS UNDER ILLINOIS SECURITIES LAW OF 1953 › Subpart B - DEFINITIONS › Section 130.212 - Definition of Acts Not Constituting an "Offer" Under Section 2.5a of the Act (Testing the Waters)

Current through Register Vol. 48, No. 28, July 12, 2024
a) The
				solicitation of indications of interest to purchase a security made by or on
				behalf of an issuer for the sole purpose of soliciting an indication of
				interest in receiving a prospectus (or its equivalent) for such security does
				not constitute an offer under Section 5 of the Act provided that all of the
				following conditions are satisfied:
1) The
				issuer is, or will be, a business entity organized under the laws of one of the
				states or possessions of the United States or one of the provinces or
				territories of Canada, is engaged in or proposes to engage in a business other
				than petroleum exploration or production or mining or other extractive
				industries and is not a blind pool offering or other offering for which the
				specific business or properties cannot now be described. For purposes of this
				Section, the term "blind pool" means, without limitation, a development stage
				company that has generally disclosed its business plan or purpose, but such
				business plan or purpose has not identified specific properties or products to
				be purchased, constructed or developed;
2) The solicitor intends to register the
				security under Section 5 of the Act;
3) At least ten business days prior to the
				initial solicitation of interest under this Section, the solicitor files with
				the Securities Department a Solicitation of Interest Form together with any
				other materials or communications which are to be utilized in the solicitation
				of interest, including, without limitation, the script of any broadcast to be
				made, the text of any electronic dissemination through such media as the
				Internet or other data networks, and any similar documents together with a copy
				of any notice or materials to be published or circulated;
4) At least five business days prior to its
				usage, the solicitor files with the Securities Department any amendments or
				supplements to the foregoing materials or additional materials to be utilized
				in the solicitation of interest, except for materials provided to a particular
				solicitee pursuant to a request by that person;
5) No Solicitation of Interest Form, script,
				advertisement or other material which the solicitor has been notified by the
				Securities Department not to distribute is utilized to solicit indications of
				interest;
6) Except for scripted
				broadcasts and published notices, the solicitor does not communicate with any
				solicitee about the contemplated offering unless the solicitee is provided with
				the most current Solicitation of Interest Form at or before the time of the
				communication but no later than five days from the date of
				communication;
7) During the
				solicitation of interest period, the solicitor does not solicit or accept money
				or a commitment to purchase securities;
8) No sale is made until seven days after
				delivery to the purchaser of a final prospectus, offering circular or
				disclosure document as the case may be, or in those instances hereunder in
				which delivery of a preliminary prospectus is allowed, a preliminary
				prospectus; and
9) The solicitor
				does not know, and in the exercise of reasonable care, could not know that the
				issuer or any of the issuer's officers, directors, ten percent shareholders,
				partners, members or promoters (or any person performing a similar function):
A) Has filed a registration statement or an
				application for registration of securities which is the subject of a currently
				effective registration stop order entered pursuant to any federal or state
				securities law within five years prior to the filing of the Solicitation of
				Interest Form.
B) Has been
				convicted within five years prior to the filing of the Solicitation of Interest
				Form of any felony or misdemeanor in connection with the offer, purchase or
				sale of any security, or any felony involving fraud or deceit, including,
				without limitation, forgery, embezzlement, obtaining money under false
				pretenses, larceny, or conspiracy to defraud.
C) Is currently subject to any federal or
				state administrative enforcement order or judgment entered by any state
				securities administrator or the Securities and Exchange Commission within five
				years prior to the filing of the Solicitation of Interest Form or is subject to
				any federal or state administrative enforcement order or judgment entered
				within five years prior to the filing of the Solicitation of Interest Form in
				which fraud or deceit, including, without limitation, making untrue statements
				of material facts or omitting to state material facts, was found.
D) Is subject to any federal or state
				administrative enforcement order or judgment which prohibits, denies, or
				revokes the use of any exemption from registration in connection with the
				offer, purchase or sale of securities.
E) Is currently subject to any order,
				judgment, or decree of any court of competent jurisdiction temporarily or
				preliminarily restraining or enjoining such party from engaging in or
				continuing any conduct or practice in connection with the purchase or sale of
				any security or involving the making of any false filing with the State entered
				within five years prior to the filing of the Solicitation of Interest Form.
The prohibitions listed above in subsections (a)(9)(A)
				  through (E) of this Section shall not apply if the person subject to the
				  disqualification is duly licensed or registered to conduct securities related
				  business in the state in which the administrative order or judgment was entered
				  against such person or if the dealer employing such party is registered in this
				  State and the Form BD filed with this State discloses the order, conviction,
				  judgment or decree relating to such person. No person disqualified under this
				  Section may act in a capacity other than that for which the person is
				  registered. Any disqualification caused by this Section is automatically waived
				  if the agency which created the basis for the disqualification determines upon
				  a showing of good cause that it is not necessary under the circumstances that
				  the exemption be denied.