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    (a) Stop orders. The administrator may issue a stop order denying effectiveness to, or
suspending or revoking the effectiveness of, a registration statement if the administrator finds
that the order is in the public interest and that:
    (1) the registration statement as of its effective date or before the effective date in the case of
an order denying effectiveness, an amendment under section 80A.53(j) as of its effective date,
or a report under section 80A.53(i), 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;
    (2) this chapter or a rule adopted or order issued under this chapter or a condition imposed
under this chapter has been willfully violated, in connection with the offering, by:
    (A) the person filing the registration statement, if the person is directly or indirectly
controlled by or acting for the issuer;
    (B) the issuer;
    (C) a partner, officer, or director of the issuer or a person having a similar status or
performing similar functions;
    (D) a promoter of the issuer;
    (E) a person directly or indirectly controlling or controlled by the issuer; or
    (F) an underwriter;
    (3) 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 chapter applicable to
the offering, but the administrator may not institute a proceeding against an effective registration
statement under this paragraph more than one year after the date of the order or injunction on
which it is based, and the administrator 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;
    (4) the issuer's enterprise or method of business includes or would include activities that are
unlawful where performed;
    (5) with respect to a security sought to be registered under section 80A.51, there has been a
failure to comply with the undertaking required by section 80A.51(b)(4); or
    (6) the applicant or registrant has not paid the filing fee, but the administrator shall void the
order if the deficiency is corrected.
    (b) Institution of stop order. The administrator may not institute a stop order proceeding
against an effective registration statement on the basis of conduct or a transaction known to the
administrator when the registration statement became effective unless the proceeding is instituted
within 30 days after the registration statement became effective.
    (c) Summary process. The administrator 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 administrator shall promptly notify each person
specified in subsection (d) that the order has been issued; the reasons for the revocation, denial,
postponement, or suspension; and that within 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 administrator, within 30 days after the date of service of the order, the
order becomes final. If a hearing is requested or ordered, the administrator, 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.
    (d) Procedural requirements for stop order. A stop order may not be issued under this
section without:
    (1) appropriate notice to the applicant or registrant, the issuer, and the person on whose
behalf the securities are to be or have been offered;
    (2) an opportunity for hearing; and
    (3) findings of fact and conclusions of law in a record in accordance with chapter 14.
    (e) Modification or vacation of stop order. The administrator may modify or vacate a
stop order issued under this section if the administrator 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.
History: 2006 c 196 art 1 s 15
NOTE: This section, as added by Laws 2006, chapter 196, article 1, section 15, is effective
August 1, 2007. Laws 2006, chapter 196, article 1, section 52.

Official Publication of the State of Minnesota
Revisor of Statutes