North Carolina Administrative Code › Title 18 - SECRETARY OF STATE › Chapter 06 - SECURITIES DIVISION › Subchapter A - RECODIFIED RULES › Section .1300 - REGISTRATION OF SECURITIES › Section 06A .1308 - ADVERTISING

Current through Register Vol. 39, No. 2, July 15, 2024
(a) For the
				  purposes of this Rule, "Advertising" shall mean any of the following to be used
				  or circulated with the sale and promotion of a public offering of securities:
				  advertisement; display; pamphlet; brochure; letter; article or communication
				  published in any newspaper, magazine or periodical; or script; or any
				  recording; or any radio or television announcement, broadcast or
				  commercial.
(b) Filing of
				  Advertising Materials. At least 10 days before use within this state, the
				  issuer shall file with the Administrator all advertising and sales material
				  that will be published, exhibited, broadcast, or otherwise used, directly or
				  indirectly, in the offer or sale of a security.
(c) Except where the conditions of
				  G.S.
				  78A-2(2)d.3. or 78A-2(2)d.4.
				  are met, all advertising circulated within this state for registered securities
				  must carry the name of at least one North Carolina registered dealer which can
				  legally make an offering of the securities in this state.
(d) The following devices or sales
				  presentations, and the use thereof in any advertising shall be deceptive or
				  misleading practices:
(1) Comparison charts or
				  graphs showing a distorted, unfair or unrealistic relationship between the
				  issuer's past performance, progress or success and that of another company,
				  business, industry or investment media;
(2) Lay-out, format, size, kind and color of
				  type used so as to attract attention to favorable or incomplete portions of the
				  advertising matter, or to minimize less favorable, modified or modifying
				  portions necessary to make the entire advertisement a fair and truthful
				  representation;
(3) Statements or
				  representations which predict future profit, success, appreciation, performance
				  or otherwise relate to the merit or potential of the securities unless such
				  statements or representations clearly indicate that they represent solely the
				  opinion of the publisher thereof;
(4) Generalizations, generalized conclusions,
				  opinions, representations and general statements based upon a particular set of
				  facts and circumstances unless those facts and circumstances are stated and
				  modified or explained by such additional facts or circumstances as are
				  necessary to make the entire advertisement a full, fair, and truthful
				  representation;
(5) Sales kits or
				  film clips, displays or exposures, which, alone or by sequence and progressive
				  compilation, tend to present an accumulative or composite picture or impression
				  of certain, or exaggerated potential, profit, safety, return or assured or
				  extraordinary investment opportunity or similar benefit to the prospective
				  purchaser;
(6) Distribution of any
				  non-factual or inaccurate data or material by words, pictures, charts, graphs,
				  or otherwise, based on conjectural, unfounded, extravagant, or flamboyant
				  claims, assertions, predictions or excessive optimism;
(7) Any package or bonus deal, prize, gift,
				  gimmick or similar inducement, combined with or dependent upon the sale of some
				  other product, contract or service, unless such unit or combination has been
				  fully disclosed and specifically described and identified in the application as
				  the security being offered; or
(8)
				  Other devices or sales presentations that are fraudulent or would tend to work
				  a fraud under
				  G.S.
				  78A-8 or
				  78A-10.