§ 17-4-306 — Denial, suspension, and revocation of securities registration

Wyoming § 17-4-306

• Jurisdiction: Wyoming
• Title 17: Corporations, Partnerships and Associations
• Ch. 4: SECURITIES
• Art. 3: REGISTRATION OF SECURITIES AND NOTICE FILING OF

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(a) The secretary of state may issue a stop order denying
effectiveness to, or suspending or revoking the effectiveness
of, a registration statement if the secretary of state finds
that the order is in the public interest and that:
(i) The registration statement as of its effective
date or before the effective date in the case of an order
denying effectiveness, an amendment under W.S. 17-4-305(k) as of
its effective date, or a report under W.S. 17-4-305(j), is
incomplete in a material respect or contains a statement that,
in the light of the circumstances under which it was made, was
false or misleading with respect to a material fact;
(ii) This act or a rule adopted or order issued under
this act or a condition imposed under this act has been
willfully violated, in connection with the offering, by the
person filing the registration statement; by the issuer, a
partner, officer, or director of the issuer or a person having a
similar status or performing a similar function; a promoter of
the issuer; or a person directly or indirectly controlling or
controlled by the issuer; but only if the person filing the
registration statement is directly or indirectly controlled by
or acting for the issuer; or by an underwriter;
(iii) The security registered or sought to be
registered is the subject of a permanent or temporary injunction
of a court of competent jurisdiction or an administrative stop
order or similar order issued under any federal, foreign, or
state law other than this act applicable to the offering, but
the secretary of state may not institute a proceeding against an
effective registration statement under this paragraph more than
one (1) year after the date of the order or injunction on which
it is based, and the secretary of state may not issue an order
under this paragraph on the basis of an order or injunction
issued under the securities act of another state unless the
order or injunction was based on conduct that would constitute,
as of the date of the order, a ground for a stop order under
this section;
(iv) The issuer's enterprise or method of business
includes or would include activities that are unlawful where
performed;
(v) With respect to a security sought to be
registered under W.S. 17-4-303, there has been a failure to
comply with the undertaking required by W.S. 17-4-303(b)(iv);
(vi) The applicant or registrant has not paid the
filing fee, but the secretary of state shall void the order if
the deficiency is corrected; or
(vii) The offering:
(A) Will work or tend to work a fraud upon
purchasers or would so operate;
(B) Has been or would be made with unreasonable
amounts of underwriters' and sellers' discounts, commissions, or
other compensation, or promoters' profits or participations, or
unreasonable amounts or kinds of options; or
(C) Is being made on terms that are unfair,
unjust, or inequitable.
(b) To the extent practicable, the secretary of state by
rule adopted or order issued under this act shall publish
standards that provide notice of conduct that violates paragraph
(a)(vii) of this section.
(c) The secretary of state may not institute a stop order
proceeding against an effective registration statement on the
basis of conduct or a transaction known to the secretary of
state when the registration statement became effective unless
the proceeding is instituted within thirty (30) days after the
registration statement became effective.
(d) The secretary of state may summarily revoke, deny,
postpone, or suspend the effectiveness of a registration
statement pending final determination of an administrative
proceeding. Upon the issuance of the order, the secretary of
state shall promptly notify each person specified in subsection
(e) of this section that the order has been issued, the reasons
for the revocation, denial, postponement, or suspension, and
that within fifteen (15) days after the receipt of a request in
a record from the person the matter will be scheduled for a
hearing. If a hearing is not requested and none is ordered by
the secretary of state, within thirty (30) days after the date
of service of the order, the order becomes final. If a hearing
is requested or ordered, the secretary of state, after notice of
and opportunity for hearing for each person subject to the
order, may modify or vacate the order or extend the order until
final determination.
(e) A stop order may not be issued under this section
without:
(i) Appropriate notice to the applicant or
registrant, the issuer, and the person on whose behalf the
securities are to be or have been offered;
(ii) An opportunity for hearing; and
(iii) Findings of fact and conclusions of law in a
record in accordance with the Wyoming Administrative Procedure
Act.
(f) The secretary of state may modify or vacate a stop
order issued under this section if the secretary of state finds
that the conditions that caused its issuance have changed or
that it is necessary or appropriate in the public interest or
for the protection of investors.