Series 63

AAA

Securities - Registration by Coordination

In the article A New Uniform Securities Act by Richard B. Smith, registration by coordination is outlined as follows:


"The objective of coordination is the simultaneous registration of the offering at the SEC and in the states where the offering is to be made. In order to facilitate coordinated registration, the state securities Administrator's association has implemented a system for coordinated review of these offerings by the states."

Under the USA, registration by coordination is for securities that are registered with the SEC, but are not federal covered securities. Securities that may fall under the category include those that do not meet the listing standards of exchanges and/or are upgrading.


Look Out!

The term "coordination" describes registration, as securities are being registered with the SEC and any States where they are to be offered and/or sold. This is by far the most common method of registration.


Under registration by coordination, the issuer, offeror or broker-dealer underwriting the offering generally needs to supply the Administrator with a long "laundry list" of items regarding the security. Note that it is not necessary to try to memorize these, just recognize that the information to be provided to the Administrator is extensive.

The USA states that registration by coordination is for a "security for which a registration statement has been filed under the Securities Act of 1933 in connection with the same offering ..." Along with a registration application, issuers must also file (directly from the USA):

  • A copy of the latest form of prospectus filed under the Securities Act of 1933;
  • A copy of the articles of incorporation and bylaws or their substantial equivalents currently in effect;
  • A copy of any agreement with or among underwriters;
  • A copy of any indenture or other instrument governing the issuance of the security to be registered;
  • A specimen, copy or description of the security;
  • Copies of any other information or any other records filed by the issuer under the Securities Act of 1933 requested by the Administrator;
  • An undertaking to forward each amendment to the federal prospectus, other than an amendment that delays the effective date of the registration statement, promptly after it is filed with the Securities and Exchange Commission.

A registration becomes effective subsequent to the federal registration, if:

  • A stop order or proceeding is not pending;
  • The registration statement has been on file for at least 20 days; or
  • The registration statement has been on file for less than 20 days, due to a rule adopted or order issued under the USA.

If federal registration is met (before all the aforementioned conditions are met), the issuer is obligated to notify the Administrator immediately.

Lastly ...
As a side note (though this will probably not be on the test), "the state securities Administrators association has implemented a system for coordinated review of such an offering by the states in which the offering is to be made."

Registration by Qualification
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