Cal. Code Regs. tit. 10 § 2604.03

Current through Register 2024 Notice Reg. No. 45, November 8, 2024

Section 2604.03 - Application for Subscription Permits

A. Applications for a permit of this nature presuppose a corporate applicant with or without assets but with officers and directors, a well-defined plan of operation and an application with substantially all of the exhibits required in the case of an application for a permit authorizing a newly organized insurer to sell its first issue of shares. (See Section 2605.01, infra, on "Applications for Organizational Permits.") Such a permit will authorize the taking of conditional subscriptions for the purchase of a particular security at a stated price, but will not authorize the collection of stock purchase money. All subscriptions shall recite substantially the conditions set forth in the specimen form set forth in Section 2613.05, infra, except that the time limits may be reasonably varied to suit applicant's plans. It is possible to issue such a permit prior to the making of findings required by Insurance Code Section 839. (Section 827.7, 843) However, in the event a permit is issued on the latter basis without such findings, it may under the circumstances hereinafter specified require that each subscriber be afforded an opportunity, within a reasonable time after receipt by the subscriber of a copy of the Commissioner's definitive permit and of the prospectus as finally approved by that permit, to disaffirm and cancel the subscriber's subscription. The circumstances referred to in the preceding sentence are these:--where in the Commissioner's judgment there has been a change between the dates of issuance of the subscription permit and of the definitive permit in the proposed venture which would render it unfair, unjust or inequitable not to allow the subscriber to withdraw; such changes include, but are not limited to, a substantial change in applicant's plan of financing or plan of operation, or among the organizers, promoters, original officers, directors or proposed key managerial personnel.

The filing fee is $25 payable at the time of filing the application. (Section 859(a))

B. Except as otherwise authorized by statute and these regulations, applications for subscription permits shall:

1. Comply with Sections 2603.01 to and including 2603.11; paragraphs A., B., D., G., H., I., and K., and if applicable L. and M. of Section 2603.12; paragraphs A. through E. of Section 2603.13 and Sec. 2603.16.

2. Attach the form of subscription (see Sec. 2613.05 for sample) and any other proposed contract, and all advertising or solicitation material proposed to be used. Such materials may not be used unless a permit is issued and their use has been approved by the Commissioner in writing.

3. State the desired commencement and termination dates of the subscription effort.

Cal. Code Regs. Tit. 10, § 2604.03

1. Change without regulatory effect amending first paragraph filed 7-14-2021 pursuant to section 100, title 1, California Code of Regulations (Register 2021, No. 29). Filing deadline specified in Government Code section 11349.3(a) extended 60 calendar days pursuant to Executive Order N-40-20.