Is A Change In Transfer Restrictions In A Shareholder Agreement Subject To Qualification?

A recent post discussed whether amending a shareholders agreement is subject to qualification under the California Corporate Securities Law of 1968. For the purpose of that discussion, it is important to recognize that not every “shareholders...

Does Amending A Shareholders Agreement Require Qualification Under The California Corporate Securities Law?

A significant amount of background is required to answer the question of whether amending a shareholders agreement is subject to qualification under the California Corporate Securities Law. As an initial matter, the CSL defines the terms "sale" and...

Want Of Privity Evidence Dooms Class Claims Against Blockchain Company

The California Corporate Securities Law of 1968 generally requires that the offer and sale of a security in an issuer transaction must be qualified unless exempt or not subject to qualification (due to preemption). Cal. Corp. Code § 25110. Anyone...

Does Jarkesy Negate Administrative Penalties Under The California Corporate Securities Law?

Yesterday, the United States Supreme Court held that when the Securities and Exchange Commission seeks civil penalties against a defendant for securities fraud, the Seventh Amendment to the U.S. Constitution entitles the defendant to a jury trial.  ...

There Are Four Answers To The Question "Is A Limited Liability Company Interest A Security Under California Law?"

The federal securities laws predate by decades the advent of limited liability companies and the statutory definitions of a "security" under those laws has not been updated to address membership interests in LLCs. California in contrast amended the...

Selling Unqualified Securities?  There's Are/Were Apps For That

If someone told my younger self that someday people would take photographs with their phones, I would have wondered where you would insert the film.* Today, the question would be "What is film?" When I headed the Department of Corporations in the...

Is There A California Connection To Kirschner?

Last summer, bankers and the lawyers who advise them breathed a collective sigh of relief when the Second Circuit Court of Appeals  upheld a U.S. District Court's opinion that notes in a bank syndicated loan were not securities.Kirschner v. JP...

Judge Rules That A Front For A Mexican Cartel Had The Capacity To Protect Its Own Interests

California Corporations Code Section 25118(b) provides an exemption from the state's usury limitations for loans. The exemption is subject to several conditions. One condition is the existence of either a preexisting relationship or a level of...

Reverse Stock Splits And The California Corporate Securities Law

Meredith Ervine recently wrote about reverse stock splits and Nasdaq listed issuers. A reverse stock split is the "go to" solution for many listed issuers whose share prices fall below the minimum continued stock exchange listing requirements....

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