Texas Administrative Code › Title 7 - BANKING AND SECURITIES › Part 7 - STATE SECURITIES BOARD › Chapter 107 - TERMINOLOGY › Section 107.2 - Definitions

Current through Reg. 49, No. 28; July 12, 2024
The following words and terms, when used in Part 7 of this
				  title (relating to the State Securities Board), shall have the following
				  meanings, unless the context clearly indicates otherwise.
(1) Act or Securities Act or Texas Securities
				Act--The Texas Securities Act, located in Title
				12 of the Texas
				Government Code, Chapters 4001 through 4008, as amended.
(2) Affiliate--An "affiliate" of, or person
				"affiliated" with a specified person, is a person that directly, or indirectly
				through one or more intermediaries, controls or is controlled by, or is under
				common control with, the person specified.
(3) APA or Administrative Procedure Act--The
				Administrative Procedure Act, Texas Government Code, Title 10, Chapter 2001, as
				amended.
(4) Applicant--A person
				who submits an application for registration of securities, documents in
				connection with the offer and sale of federal covered securities, or for
				registration as a dealer, agent, investment adviser, or investment adviser
				representative, or who files an application for an order of the Securities
				Commissioner.
(5) Board or
				Securities Board--The State Securities Board of the State of Texas.
(6) Certified--In conjunction with the term
				"financial statement(s)," means financial statement(s) prepared in accordance
				with generally accepted accounting principles and examined in accordance with
				generally accepted auditing standards by independent certified public
				accountants or independent public accountants for the purposes of expressing an
				opinion thereon. Such opinion shall be one acceptable to the Securities
				Commissioner.
(7) CFR--The Code of
				Federal Regulations, as amended.
(8) Commissioner or Securities
				Commissioner--The State Securities Commissioner for the State of
				Texas.
(9) Control--The possession,
				direct or indirect, of the power to direct or cause the direction of the
				management and policies of a person or company, whether through the ownership
				of voting securities, by contract, or otherwise.
(10) Credit union--For definition see the
				Texas Credit Union Act (Texas Finance Code, Chapter 121, as amended), which
				regulates such credit unions.
(11)
				Detailed balance sheet--A balance sheet.
(12) Qualified institutional buyer--An entity
				described in Rule 144A, as promulgated by the SEC under the Securities Act of
				1933 (17 CFR §
										230.144A, as amended).
(13) Domestic corporation--A corporation
				incorporated under the laws of the State of Texas.
(14) Federal covered investment adviser--An
				investment adviser who is registered under the Investment Advisers Act of 1940
				(RSA
				80b-1 et seq.), as amended. A federal covered
				investment adviser is not required to be registered pursuant to the Texas
				Securities Act.
(15) Federal
				covered securities--Any security or securities described as a "covered
				security" or as "covered securities" in the Securities Act of 1933,
				§18(b), or rules or regulations promulgated thereunder.
(16) Financial statement(s)--Balance sheet
				and related statements of income, changes in stockholders' equity, and cash
				flows, all (consolidated, if applicable) prepared in accordance with generally
				accepted accounting principles. The information contained in the previously
				described statements may vary according to presentation and titles as they
				relate to specific entities, such as individuals, partnerships, and nonprofit
				organizations.
(17) Investment
				Advisers Act of 1940--The federal statute of that name, as amended,
				RSA
				80b-1, et seq.
(18) Investment Company Act of 1940--The
				federal statute of that name, as amended,
				RSA
				80a-1, et seq.
(19) License--The whole or part of any
				registration as a dealer, investment adviser, agent, or investment adviser
				representative, or similar form of permission required by the Texas Securities
				Act to sell securities or render investment advice.
(20) Licensing--The process respecting the
				granting, denial, renewal, revocation, suspension, withdrawal, or amendment of
				a license.
(21) Managing agent or
				manager--One who is authorized to act generally for an organization within a
				particular locality.
(22)
				FINRA--The Financial Industry Regulatory Authority, created through the
				consolidation of NASD and the member regulation, enforcement, and arbitration
				functions of the New York Stock Exchange.
(23) Officer--A president, vice president,
				secretary, treasurer, or principal financial officer, comptroller, or principal
				accounting officer, or any other person occupying a similar status or
				performing similar functions with respect to any organization or entity,
				whether incorporated or unincorporated.
(24) Operating statement--An income
				statement.
(25) Parent--A person
				controlling another person directly or indirectly.
(26) Profit and loss statement--An income
				statement.
(27) Proposed plan of
				business--As used in the Texas Securities Act, those aspects and only those
				aspects of the business set-up (other than that done or proposed in respect to
				the pricing and selling of its securities) which would materially affect the
				business relationship between the prospective investor and those in control of
				the business as such relationship would exist after the sale to the public of
				the securities sought to be registered.
(28) Regulatory standards--All standards
				coming within the meaning of "rule" as defined herein.
(29) Rendering services as an investment
				adviser--Any act by which investment advisory services are provided for
				compensation.
(30) Rule--Any
				statement by the Board or the Securities Commissioner of general applicability
				that implements, interprets, or prescribes law or policy, or describes the
				procedure or practice requirements of the Board or Securities
				Commissioner.
(31) Savings and loan
				association--For definition see the Texas Savings and Loan Act (Texas Finance
				Code, Chapter 61, as amended), which regulates such savings and loan
				associations.
(32) SEC--The United
				States Securities and Exchange Commission.
(33) Securities Act of 1933--The federal
				statute of that name, as amended,
				RSA
				77a, et seq.
(34) Securities Exchange Act of 1934 or
				Federal Securities Exchange Act of 1934--The federal statute of that name, as
				amended, 15 United States
				Code §
										78a,
et
				seq.
(35) Staff--Personnel
				of the Securities Board, excluding the members of the Board, the Securities
				Commissioner, and the Deputy Commissioner.
(36) State, territory, or insular possession
				of the United States--As used in the Texas Securities Act, includes a
				commonwealth.
(37) NASAA--The North
				American Securities Administrators Association, Inc.
(38) Telephone or telegram--For purposes of
				the Texas Securities Act, §4003.103, includes any means of electronic
				transmission such as, but not limited to, telephone, telegraph, wireless,
				email, graphic scanning, modem, or facsimile; provided, however, that the
				office of the State Securities Board has the necessary equipment to accept such
				a transmission.
(39) Within this
				state or in this state--
(A) A person is a
				"dealer" who engages "within this state" or "in this state" in one or more of
				the activities set out in the Texas Securities Act, §4001.056, if either
				the person or the person's agent is present in this state or the
				offeree/purchaser or the offeree/purchaser's agent is present in this state at
				the time of the particular activity. A person can be a dealer in more than one
				state at the same time.
(B)
				Likewise, a person is an "agent" who engages "within this state" or "in this
				state" in one or more of the activities set out in the Texas Securities Act,
				§4001.052, whether by direct act or through subagents except as otherwise
				provided, if either the agent or the agent's subagent is present in this state
				or the offeree/purchaser or the offeree/purchaser's agent is present in this
				state at the time of the particular activity. A person can be an agent in more
				than one state at the same time.
(C) Offers and sales can be made by personal
				contact, mail, telegram, telephone, wireless, electronic communication, or any
				other form of oral or written communication.