reglab/statecodes huggingface dataset:
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 4 - Rights, Warrants and Options › Section 260.140.46 - Information to Security Holders

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Plans or agreements pursuant to which securities are to
						be issued to employees, officers, directors, managers, advisors or consultants
						(including option, purchase and bonus plans) shall provide that the security
						holder(s) will receive financial statements at least annually. This section
						does not require the use of financial statements in accordance with Section
						260.613 of these rules. This
						section shall not apply when issuance is limited to key persons whose duties in
						connection with the issuer assure them access to equivalent information. This
						section shall not apply to any plan or agreement that complies with all
						conditions of Rule 701 of the Securities Act of 1933, as amended (17 C.F.R.
						230.701); provided that for purposes of
						determining such compliance, any registered domestic partner shall be
						considered a "family member" as that term is defined in Rule
						701.
1. New
						section filed 12-5-91; operative 1-6-92 (Register 92, No. 9).
2.
						Amendment filed 12-28-2000 as an emergency; operative 1-1-2001 (Register 2000,
						No. 52). A Certificate of Compliance must be transmitted to OAL by 5-1-2001 or
						emergency language will be repealed by operation of law on the following
						day.
3. Amendment refiled 5-2-2001 as an emergency; operative
						5-2-2001 (Register 2001, No. 18). A Certificate of Compliance must be
						transmitted to OAL by 8-30-2001 or emergency language will be repealed by
						operation of law on the following day.
4. Amendment refiled
						8-30-2001 as an emergency; operative 8-30-2001 (Register 2001, No. 35). A
						Certificate of Compliance must be transmitted to OAL by 12-28-2001 or emergency
						language will be repealed by operation of law on the following
						day.
5. Certificate of Compliance as to 8-30-2001 order, including
						further amendment of section heading and section, transmitted to OAL 12-27-2001
						and filed 2-7-2002 (Register 2002, No. 6).
6. Amendment of section
						and NOTE filed 7-9-2007; operative 7-9-2007 pursuant to Government Code section
						11343.4
						(Register 2007, No. 28).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Sections
						  25102,
						  25110,
						  25140,
						  25610
						  and
						  25612.5,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 5 - Offering Price › Section 260.140.50 - Review of the Offering Price

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
In connection with those offerings specified in
						subdivision (d) of Section
						25140 of the Code, the
						Commissioner will not consider the fairness of the offering price, except
						insofar as the offering price in its relation to the price at which securities
						of the same class have been sold by the issuer to others would make such other
						securities promotional shares and would result in unreasonable promoters'
						profits or participations. In connection with other offerings, securities shall
						be sold at a price which is fair to the issuer and the purchasers. In
						determining whether the price is fair, predominant weight will be given to the
						following:
(a) If securities of the
					 same class are publicly traded on an active market of substantial depth, the
					 recent market price of such securities.
(b) If securities of the same class have not
					 been so publicly traded, the price at which securities of reasonably comparable
					 corporations (if any) in the same industry are being traded, subject to
					 appropriate adjustments for the dissimilarities between the corporations being
					 compared.
(c) In the absence of any
					 reliable indicator under subsection (a) or subsection (b), the earnings
					 history, book value and prospects of the issuer in the light of market
					 conditions generally. The initial public offering price shall not be less than
					 $2.00 per share.
1.
						Amendment filed 5-3-83; effective thirtieth day thereafter (Register 83, No.
						19).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 5 - Offering Price › Section 260.140.51 - Sliding Scale Contracts

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
No qualification will be approved for the sale of
						securities pursuant to a contract whereby the price of the securities sold
						varies among different purchasers of the same offering or whereby such price
						varies as a result of the quantity of securities sold, except that in the case
						of quantity discounts qualification may be approved provided that there is
						compliance with all of the following six conditions.
(a) There is no variance in the net proceeds
					 to the issuer from the sale of the securities to different purchasers of the
					 same offering;
(b) All purchasers
					 of the securities are informed of the available quantity discounts;
(c) The same quantity discounts are allowed
					 to all purchasers of all securities which are part of the offering;
(d) The minimum amount of securities on the
					 purchase of which quantity discounts are allowed is not less than
					 $10,000;
(e) The variance in the
					 price of the securities results solely from a different range of commissions,
					 no discounts are allowed to any group of purchasers, and all discounts allowed
					 are based on a uniform scale of commissions;
(f) The applicant for qualification of the
					 securities justifies allowance of the proposed quantity discounts by a showing
					 that the aggregate amount thereof does not exceed, and that the measure of such
					 discounts is reasonably related to, the saving of selling expense to be
					 achieved in the sale of the quantities of securities for which such discounts
					 are allowed.
The foregoing rule does not prohibit a quantity discount
						offered by an investment company registered under the Investment Company Act of
						1940, as permitted by the Regulations under that Act, and does not apply to any
						employee option or stock purchase plans.
1.
						Amendment filed 5-10-73; effective thirtieth day thereafter (Register 73, No.
						19).
2. Amendment filed 5-3-83; effective thirtieth day thereafter
						(Register 83, No. 19).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 6 - Recapitalizations and Reorganizations › Section 260.140.60 - Filing of Proxy Materials

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
If qualification of a recapitalization or reorganization
						is required, no materials designed to solicit proxies or consents from security
						holders in connection therewith shall be distributed without the prior filing
						of such proxy materials with the Commissioner and the issuance of a permit. A
						preliminary copy of such materials shall be attached as an exhibit to the
						application for qualification.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 6 - Recapitalizations and Reorganizations › Section 260.140.61 - Mergers and Consolidations

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A plan of reorganization contemplating the combination of
						two or more businesses by way of merger or consolidation (including a sale of
						assets in exchange wholly or in part for securities of the purchasing
						corporation) should provide for the issuance of securities which fairly reflect
						the relative values of the corporations which are parties to the plan of
						reorganization. The permit authorizing the issuance of securities in connection
						with a plan of reorganization may be conditioned upon the obtaining of an
						affirmative vote of a specified percentage of the outstanding stock held by
						persons other than those who have a conflict of interest in connection with the
						adoption of the plan of reorganization.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 6 - Recapitalizations and Reorganizations › Section 260.140.62 - Hearings

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A hearing pursuant to Sections
						250.17-250.25 of these rules may
						be ordered by the Commissioner in unusual circumstances in connection with an
						application for a permit to sell securities in any recapitalization or
						reorganization, and such a hearing will be held upon the request of the
						applicant.
1.
						Amendment filed 3-20-78; effective thirtieth day thereafter (Register 78, No.
						12).
Note: Authority cited: Sections
						  25140
						  and
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 6 - Recapitalizations and Reorganizations › Section 260.140.63 - Negotiating Permit in Connection with Recapitalizations and Reorganizations

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Normally, no negotiating permit is required or will be
						issued in connection with a recapitalization or reorganization. Any
						negotiations prior to general solicitation of shareholders' approval are
						exempted by subdivision (a) of Section
						25103 of the Code. An application
						for a definitive permit should be made prior to the distribution of the proxy
						material to the shareholders and normally will be acted upon prior to such
						distribution. The permit, however, may be conditioned upon the obtaining of an
						affirmative vote of a specified percentage of the outstanding shares held by
						persons other than those who have a conflict of interest in connection with the
						adoption of the plan of reorganization or recapitalization. In extraordinary
						cases the Commissioner may delay decision on the issuance of the definitive
						permit until after the shareholders' vote, and in that case a negotiating
						permit will be issued prior to the solicitation of shareholders' approval
						without the necessity for any separate application therefor upon payment of the
						additional fee specified therefor.
1.
						Renumbering of former Section
						260.121 to Section
						260.140.63 filed 10-26-84;
						effective thirtieth day thereafter (Register 84, No.
						43).
Note: Authority cited: Sections
						  25102(c),
						  25610
						  and
						  25612,
						  Corporations Code. Reference: Sections
						  25102(c),
						  25140
						  and
						  25160,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7 - Stock Dividends and Stock Splits › Section 260.140.70 - Stock Dividends and Stock Splits

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An application for the issuance of securities in a stock
						dividend or stock split (which is not exempt from qualification by subdivision
						(f) of Section
						25017 or subdivision (f) of
						Section 25103 of the Code) will normally
						be approved unless as a result thereof the relative voting power of different
						classes of stock would be unfairly altered. However, a stock split which would
						reduce the market price of the securities to less than two dollars per share
						(referred to in Clause (2) of subdivision (f) of Section
						25103 of the Code) or a reverse
						stock split which would substantially alter the proportionate interests of the
						shareholders (referred to in Clause (3) of subdivision (f) of Section
						25103 of the Code) will not
						normally be approved.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71 - Purpose

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The purpose of the mutual water company rules is
						two-fold: To assure that an adequate water supply and distribution system
						exists for human consumption (or irrigation for agricultural use) and for fire
						protection; and to assure that adequate disclosure and protection to the
						security holders exists with respect to rights and duties arising from their
						security holdings in the mutual water company.
1. New
						Subarticle 7.1 (Sections
						260.140.71 -
						260.140.71.10) filed 4-14-83;
						effective thirtieth day thereafter (Register 83, No.
						16).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.1 - General

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A mutual water company seeking a permit from the
						Commissioner must be organized under either the General Corporation Law
						(Corporations Code Sections
						100-
						2319) or
						the Nonprofit Corporation Law relating to Nonprofit Mutual Benefit Corporations
						(Corporations Code Sections
						7110-
						8910).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.3 - Content of Engineer's Report

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The engineer's report filed with the application shall
						contain all relevant information pertaining to the proposed water supply
						distribution and fire protection system including, but not limited to, the
						following:
(a) A system map of the
					 area to be served showing:
(1) The total
					 acreage;
(2) The number and
					 location of lots into which the area is or can be subdivided and the location
					 of the connection for water service;
(3) The location of all sources of supply,
					 principal pumping stations, diversion works, water treatment and filter plants,
					 and storage facilities; the size, character, and location of all mains and
					 ditches; and the location of all valves and gates, gauges, interconnections
					 with other systems, and fire hydrants;
(4) The location, size, and kind of each
					 service pipe;
(5) The layout of all
					 principal pumping stations and water treatment and filter plants to show size,
					 location, and character of all major equipment, pipelines, connections, valves,
					 and other equipment used in connection therewith;
(6) The date of construction and condition of
					 all principal items of plant and extensions of all mains.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.4 - Design Standards for Water Supply and Distribution Systems

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The water supply and distribution system of a mutual
						water company proposing to distribute water for human consumption should comply
						with the following design standards:
(a) The system will be adequate to maintain
					 normal operating pressure of not less than 25 pounds per square inch, nor more
					 than 125 pounds per square inch, at the service connection; provided, however,
					 that during periods of hourly maximum demand, or at the time of peak seasonal
					 loads, the pressure may be reduced to not less than 20 pounds per square inch,
					 and during periods of hourly minimum demand the pressure may increase to not
					 more than 150 pounds per square inch. Variations in pressure under normal
					 operation should not exceed fifty percent of the average operating pressure.
					 The average operating pressure should be determined by computing the
					 arithmetical average of at least twenty-four consecutive hourly pressure
					 readings.
(b) The quantity of water
					 delivered to the distribution system from all source facilities should be
					 sufficient to supply adequately, dependably, and safely the total requirements
					 of all water consumers under maximum consumption, and should be sufficient to
					 maintain the pressure specified by subsection (a) of this section.
(c) The distribution system should provide at
					 least one connection per service and, to the extent feasible, should be
					 designed in a property segmented grid so as (1) to minimize the extent of
					 interruption in water service when repairs are necessary and (2) to avoid dead
					 ends in its water mains.
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.5 - Design Standards for Fire Protection System

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) In addition to complying with the
					 requirements of the other provisions of this Subarticle 7.1, the mutual water
					 company shall provide at least a minimum level of water service to its
					 customers for fire protection purposes as an inherent part of the water system
					 design in accordance with the standards set forth below. These standards are
					 stated as minimum levels of water service which the mutual water company shall
					 provide and are not intended to preclude the mutual water company from
					 designing a fire protection system meeting higher standards, nor preclude any
					 governmental agency from setting higher standards in any area subject to its
					 jurisdiction. A mutual water company may request the Commissioner to exercise
					 discretion with respect to a fire protection system not meeting the design
					 standards set forth herein upon a strong showing by the mutual water company
					 that the system is adequate for fire protection purposes. In determining
					 whether to exercise discretion, the Commissioner, among other things, will look
					 to a written statement from the entity providing fire protection service that
					 the system is adequate for fire protection.
(b) Initial Construction, Extension, or
					 Modification. In the initial construction, extension, or modification of a
					 water system, any one of which is required to serve (1) a new user or (2) a
					 change in use, the facilities constructed, extended, or modified shall be
					 designed to be capable of providing, for a sustained period of at least two
					 hours, in addition to the requirements of the average daily demand within the
					 area to be served, the minimum flow requirements set forth below opposite the
					 classification of land use to be served:
Land Use
Minimum Flow
1.
Rural, residential with a lot density of two or
								  less per acre primarily for recreational and retirement use.
250 gpm
2.
Lot density of less than one single-family
								  residential unit per acre.
500 gpm
3.
Lot density of one or two single-family
								  residential units per acre.
750 gpm
4.
Lot density of three or more single-family
								  residential units per acre.
1,000 gpm
5.
Duplex residential units, neighborhood business
								  of one story.
1,500 gpm
6.
Multiple residential, one and two stories; light
								  commercial or light industrial.
2,000 gpm
7.
Multiple residential, three stories or higher;
								  heavy commercial or heavy industrial.
2,500 gpm
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.6 - Water Supply and Distribution System Construction Standards

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The water supply and distribution system of a mutual
						water company proposing to distribute water for human consumption shall be
						constructed to conform with currently accepted engineering practices, and shall
						comply with the following construction standards where possible:
(a) Water mains to be installed below the
					 frost level or otherwise protected to prevent freezing and should not have less
					 than 30 inches of cover over the top of the pipe in public streets or alleys
					 except where such depth is rendered impossible by underground obstructions or
					 rocky or hardpan conditions.
(b)
					 The size, design, material, and installation of service pipes to conform to the
					 reasonable requirements of the mutual water company; provided, however, that
					 the minimum size of the pipe to be not less than ¾ inch nominal size.
					 Except where services are not intended for use during freezing weather and
					 arrangements are made to drain service pipes prior to such weather, and except
					 at terminations in connection with the meter or water consumer's piping, all
					 service pipes to be laid at a depth sufficient to prevent freezing.
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.7 - Fire Protection System Construction Standards

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The fire protection system of a mutual water company must
						be constructed to conform with currently accepted engineering practices, and
						must comply with the following construction standards:
(a) Flow Tests. The flows set forth in
					 Section 260.140.71.5 above are to be
					 calculated on the basis of a residual pressure of 20 p.s.i.g. in the
					 distribution system under flowing conditions.
(b) Fire Hydrants. Fire hydrants shall be
					 attached to the distribution systems at the locations designated by the entity
					 responsible for their use for fire fighting purposes. Any new mains to which a
					 hydrant may be attached shall be not less than six inches in
					 diameter.
(c) Source of Supply.
					 Each separately operated water system shall have not less than two independent
					 sources of supply.
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.8 - Fire Hydrant Maintenance, Repair or Replacement; Annual Flow Tests

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The mutual water company is financially responsible for
						the maintenance, repair or replacement of fire hydrants. See Civil Code Section
						549 regarding
						charges from mutual water companies to entities providing fire protection
						services. A mutual water company must perform and record annual flow tests
						pursuant to Section
						260.140.71.7(a)
						or, in lieu of the annual flow test under Section
						260.140.71.7(a),
						any test to determine available flow performed by a fire protection agency. The
						recorded test results will become part of the mutual water company's books and
						records.
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.9 - Permit Issuance Prior to Completion of Water Supply, Distribution and Fire Protection System

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
					 Generally, the Commissioner will not issue a permit authorizing the offer and
					 sale of securities of a mutual water company if the water supply, distribution
					 and fire protection system has not been installed and is not ready to operate.
					 However, upon a showing by the engineer for the mutual water company that the
					 water supply, distribution and fire protection system is substantially
					 completed (i.e., completion of at least 75% of the system), the Commissioner
					 may issue a permit.
(b) In addition
					 to the requirement of a showing of substantial completion of the system, the
					 mutual water company must file a completion bond issued to it and naming it as
					 beneficiary in order to protect proposed security holders from unexpected costs
					 attributable to completion of the system. The amount of the completion bond
					 should be at least 120% of the then estimated cost to complete the facilities
					 (as determined by the engineer) and it must state that the water supply,
					 distribution and fire protection system will be complete within six months from
					 the date of purchase of the bond.
(c) As an alternative to a completion bond,
					 the mutual water company may propose other arrangements to guarantee completion
					 of the water supply, distribution and fire protection system. A mutual water
					 company proposing other arrangements to guarantee completion of the system must
					 first obtain the written consent of the Commissioner that the arrangement is
					 satisfactory.
(d) Where the
					 Commissioner approves a qualification without requiring the water supply,
					 distribution and fire protection system to be installed and ready to operate,
					 as provided for above, a condition will be imposed upon the permit, but not
					 limited to, prohibiting the sale of securities prior to the completion of the
					 system and the filing of the report required by Section
					 260.140.71.2(a)(viii).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.1 - Mutual Water Companies › Section 260.140.71.10 - Application for Subsequent Qualification by Permit Pursuant to Section 25113 of the Corporate Securities Law of 1968

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
When a mutual water company has already sold securities
						pursuant to a previously issued permit, an application for a subsequent
						qualification of additional securities shall comply with Sections
						260.110 and
						260.113, incorporating by
						reference the information already on file with the Department and furnishing
						any amendment or revision thereto by exhibit. The following additional
						information must be filed as an exhibit to Item 20 of Section
						260.113:
(a) Copies of operating records of the
					 applicant indicating the number of water customers and the total amount of
					 water consumed at the time the application is filed.
(b) An engineer's report meeting the
					 requirements of Section
					 260.140.71.3 for the total water
					 supply, distribution and fire protection system, present and proposed,
					 concluding that one, completely integrated and serviceable water supply,
					 distribution and fire protection system exists. The engineer's report must also
					 state any changes in the water distribution and fire protection system and must
					 state whether adequate water is available to serve present as well as proposed
					 new users. In addition, the engineer's report must include the quantity of
					 water available at the time the report is prepared and a detailed estimate of
					 the water requirements of the present and proposed users.
(c) If the mutual water company distributes
					 or intends to distribute water for human consumption, it must file a copy of
					 the certificate then in effect from the Director of Public Health as required
					 by Sections
					 4010-
					 4024
					 of the Health and Safety Code.
(d)
					 If the mutual water company was originally formed, or is now intended to be
					 used, in connection with subdivided lands or a subdivision of land as defined
					 in Sections
					 11000,
					 11000.1,
					 11000.5,
					 and
					 11004.5
					 of the Business and Professions Code, an additional copy of the application
					 must be filed for comment by the Commissioner of Real Estate.
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72 - Purpose; Definitions

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
					 This subarticle sets forth the standards with respect to an application of a
					 church for a permit to sell debt securities in a limited offering pursuant to
					 Section 25113 of the Code. An offering of
					 church debt securities to the general public, even if combined with an offering
					 to the persons described in subdivision (d), will be subject to the standards
					 generally applicable to public offerings of debt securities (including, but not
					 limited to, Rules 260.140.4, 260.140.5 and 260.140.10) and to the special
					 standards set forth in this subarticle, except for Rules 260.140.72.3 and
					 260.140.72.4.
(b) "Cash-flow," as
					 used in Rule 260.140.10 when applicable to offerings of debt securities by
					 churches and for the purposes of this subarticle, and as used in Rule
					 260.140.72.2, means donations and other revenue which can be demonstrated to be
					 of a continuing nature as distinguished from irregular fund raising
					 campaigns.
(c) "Church," for the
					 purposes of this subarticle, includes a church, a synagogue, temple, mosque or
					 other place of worship and related church property such as a school or youth
					 camp. "Church" shall be a nonprofit organization that operates exclusively for
					 religious purposes and is an organization described in Section
					 501(c)(3) of the
					 Internal Revenue Code of 1986, as amended.
(d) "Limited offering," for the purposes of
					 this subarticle, means an offering only to a group of persons, each of whom is
					 an individual who, prior to solicitation for the purchase of the security, was
					 a member of, contributor to, or participant in the church or in any specified
					 program, activity or organization which is a part of the church, or who is a
					 family member of such individual. In addition, "limited offering" for purposes
					 of this subarticle may include an offering to a bank, savings and loan
					 association, trust company, insurance company, investment company registered
					 under the Investment Company Act of 1940, or pension or profit-sharing trust
					 (other than a pension or profit-sharing trust of the issuer), whether the
					 purchaser is acting for itself or as trustee. As used in this subsection,
					 "family member" means an ancestor or descendant, a brother, sister, aunt,
					 uncle, niece, nephew or first cousin.
1. New
						section filed 2-8-89; operative 3-10-89 (Register 89, No. 8).
2.
						Amendment of subsection (c) filed 4-1-2005; operative 5-1-2005 (Register 2005,
						No. 13).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.1 - Application for Qualification

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The application must contain the information required by
						Sections 260.110 and
						260.113 of the Commissioner's
						Rules. In addition, the following information must be filed as an exhibit to
						the application:
(a) If any portion of
					 the net proceeds from the sale of the securities is to be used for the
					 construction of real estate improvements, a schedule detailing the construction
					 of the project and a statement of estimated cost with respect to each part of
					 the construction project. The cost estimate shall be substantiated by a
					 statement of a qualified independent contractor or other qualified and
					 independent person. The application shall demonstrate that with the proceeds of
					 the proposed financing, the applicant will have funds sufficient to complete
					 the project.
(b) A copy of the
					 resolution adopted by the governing body of the applicant providing:
(1) for a fund devoted exclusively to the
					 payment of interest and principal on the debt securities proposed to be issued
					 and pledging a specified portion of the monthly revenues of the applicant to
					 the fund devoted exclusively to the payment of such interest and principal. The
					 portion pledged shall be sufficient for the payment of current interest and
					 maturing installments of principal;
(2) that such fund shall be maintained with
					 and administered by a federally insured bank located in any of the United
					 States;
(3) That all monies
					 received from the sale of securities shall be deposited in a trust account
					 available only for expenditures on account of the project for which the
					 indebtedness is to be incurred; and
(4) that such trust account shall be
					 maintained with and administered by a bank or savings and loan association
					 located in California. This subsection (b)(4) shall not apply to:
(A) a firmly underwritten public offering;
					 or
(B) a public offering where the
					 issuer and selling broker-dealer commit as a part of the verified application
					 of the issuer that less than 50 percent of the debt is to be held by persons
					 who have addresses in this state according to the records of the underwriter.
					 For the purposes of this rule, a public offering is "firmly underwritten" when
					 an underwriter unconditionally agrees to purchase all the debt to be issued by
					 a church in a specified offering to the public, subject to agreed upon
					 provisions relating to acts occasioned by nature without the interference of
					 any human agency.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.2 - Aggregate Debt

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An applicant must demonstrate its ability to repay debt
						from cash flow. As a general rule, the aggregate debt of the issuer on
						completion of the offering should not exceed an amount which can be serviced as
						to principal and interest with one-third of applicant's cash flow. The general
						rule notwithstanding, an applicant may justify incurring a larger indebtedness
						by demonstrating:
1) ability to devote
					 more cash flow to the service of indebtedness;
2) that an increase in cash flow is to be
					 anticipated in line with past experience or as a result of the improvements to
					 be provided with the proceeds of the proposed financing; or
3) other appropriate reasons.
1. New
						section filed 2-8-89; operative 3-10-89 (Register 89, No.
						8).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.3 - Sales Commissions

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Sales commissions in connection with the sale of the debt
						securities (exclusive of expenses incurred in preparation of the offering)
						shall not exceed 2 l/2% of the monies collected from the sale of such
						securities.
1. New
						section filed 2-8-89, operative 3-10-89 (Register 89, No.
						8).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.4 - Limitations on Transfer

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Limitations shall be imposed upon the transfer of the
						debt securities so as to maintain ownership with the group of individuals
						described in Section
						260.140.72(d).
						Transfers outside that group by gift or as security for a loan shall be
						permissible.
1. New
						section filed 2-8-89, operative 3-10-89 (Register 89, No.
						8).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.5 - Disclosure

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The offering
					 shall be accompanied by a disclosure document in the form and containing the
					 information required by the Offering Circular provisions of the Statement of
					 Policy Regarding Church Bonds of the North American Securities Administrators
					 Association, adopted April 14, 2002. In addition, a Cross Reference Sheet,
					 which is substantially equivalent to the form that accompanies the Statement of
					 Policy Regarding Church Bonds adopted April 14, 2002 and the proposed
					 disclosure document shall be attached as an exhibit to the
					 application.
(b) If purchasers are
					 given the opportunity to make payment by means of borrowing or installment
					 payments, these payment methods shall be clearly described in the disclosure
					 documents, and all expenses and charges, including those on account of interest
					 or loss of interest, if any, shall be disclosed.
(c) Terms such as "lay-away-plan," "safe
					 investment," and "revenue bonds" shall not be approved. Unsecured promissory
					 notes may not be described as "bonds."
1. New
						section filed 2-8-89, operative 3-10-89 (Register 89, No. 8).
2.
						Amendment of subsection (a) filed 4-1-2005; operative 5-1-2005 (Register 2005,
						No. 13).
Note: Authority cited: 25610, Corporations Code.
						  Reference: Section
						  25140,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 7.2 - Offerings of Debt Securities by Churches › Section 260.140.72.6 - Financial Statements

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
An application for an offering of debt securities by a
						church shall be accompanied by audited financial statements meeting the
						requirements of Rule 260.613, except that:
(1) audited financial statements meeting the
					 requirements of Rule260.613 may be filed for the church's last fiscal year only
					 when audited financial statements for more than the last fiscal year are
					 unavailable and unaudited financial statements for the two prior fiscal years
					 are also filed; or
(2) audited
					 financial statements meeting the requirements of Rule 260.613 may be filed for
					 the church's last two fiscal years only when audited financial statements for
					 more than the last two fiscal years are unavailable and an unaudited financial
					 statement for the prior fiscal year is also filed. The foregoing
					 notwithstanding, this rule shall not diminish or otherwise restrict the
					 Commissioner's discretion under Rule 260.613 to waive such requirements when
					 appropriate such as the issuance of debt securities only to the members of the
					 congregation of a church.
1. New
						section filed 2-8-89; operative 3-10-89 (Register 89, No.
						8).
Note: Authority cited: Section
						  25610,
						  Corporations Code. Reference: Section
						  25140
						  and
						  25613,
						  Corporations Code.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 8 - Investment Companies › Section 260.140.80 - Front-End Load Prohibited

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A qualification will not be approved for the sale of
						open-end investment company shares pursuant to a contractual plan whereby more
						than a pro rata portion of the load or commission is deducted from any
						installment payment or whereby any charge, penalty or forfeiture is assessed
						for failure to make installment payments.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 8 - Investment Companies › Section 260.140.80.5 - Contractual Periodic Payment Plan Standards

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Notwithstanding Rules 260.140.80 and 260.140.83, the
						offer and sale of shares in a contractual periodic payment plan (the "plan")
						whereby more than a pro rata portion of the load or commission is deducted from
						any installment payment may be qualified, provided that the offer and sale of
						the shares and the plan conform to the following guidelines.
(a) Determination of Suitability of
					 Purchasing Investor.
No shares in a plan may be offered for sale in this state
						unless a principal of the selling broker-dealer has determined that the plan is
						suitable for the purchasing investor. This determination shall be based upon,
						but not be limited to, consideration of the following facts:
(1) The investor's age, marital status, and
					 number of dependents.
(2) The
					 investor's major investment goals and the time frame for achieving these
					 goals.
(3) The investor's current
					 and anticipated future financial status, including income, and reasonably
					 anticipated short-and long-term liabilities or other obligations.
(4) The reasonable likelihood of the
					 investor's continued income.
(5)
					 The investor's ability to address potentially burdensome financial situations,
					 (e.g., the death of a family member) through the use of insurance, savings, or
					 other assets; and
(6) The
					 investor's understanding of the risks inherent in investing in securities and
					 the usefulness of savings instruments or accounts for short-term needs.
The selling broker-dealer shall retain for at least five
						(5) years the documents disclosing the basis upon which the determination of
						suitability was made as to each purchasing investor.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 8 - Investment Companies › Section 260.140.81 - Prohibition on Promotional Shares

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
No promotional shares, as defined in Section
						260.140.30 of these rules, shall
						be issued in connection with the sale of securities of an investment
						company.
California Code of Regulations › Title 10 - Investment › Chapter 3 - Commissioner of Financial Protection and Innovation › Subchapter 2 - Corporate Securities › Article 4 - Standards for the Exercise of the Commissioner's Authority › Subarticle 8 - Investment Companies › Section 260.140.82 - Prohibition on Options

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
No option shall be issued by an open-end investment
						company; provided, however, that this prohibition does not apply to short-term
						options issued to permit the reinvestment of dividends or distributions of
						capital gains.