La. Admin. Code tit. 10 § XV-311

Current through Register Vol. 50, No. 11, November 20, 2024

Section XV-311 - Conditions of Certification

A. All CAPCOs, through an act under private signature executed by the business, duly acknowledged pursuant to Louisiana law, shall certify and acknowledge all of the following conditions for certification as a certified Louisiana capital company and shall certify and acknowledge that the act statement is true and correct.

1. The CAPCO has an initial capitalization of not less than $200,000. If any capitalization is repurchased or contemplated to be repurchased by the CAPCO within five years after certification, the CAPCO will concurrently replace any repurchased capital with cash capital, as defined under Generally Accepted Accounting Principles. Furthermore, any contemplated repurchases shall be disclosed in all governing documents to all prospective investors. The amount repurchased shall not be the basis for any income tax credits or premium tax reductions.

2. At least 30 days prior to the sale or redemption of stock, partnership interests, other equivalent ownership interests or debentures constituting 10 percent or more of the then outstanding shares, partnership interests, other equivalent ownership interests or debentures, the CAPCO will provide a written notification to the office. Information, as determined by the commissioner, shall be submitted with the notification. If the commissioner does not object to the notification within 30 days of the receipt, the notification shall be deemed approved.

3. The board of directors will not elect new or replace existing board members or declare dividends without prior written consent of the office for the first two years of business.

4. The CAPCO will immediately notify the office when its total certified capital under management is not sufficient to enable the CAPCO to operate as a viable going concern.

5. The CAPCO will not engage in any activity which represents a material difference from the business activity described in its application without first obtaining prior written approval by the office.

6. The CAPCO will comply with the CAPCO Act and all applicable rules, regulations and policies that are currently in effect or enacted after the date of certification.

7. The CAPCO will adopt OFI's valuation guidelines and record retention policies.

8. Any other conditions deemed relevant to the commissioner.

B.

1. If a CAPCO contemplates any public or private securities offerings, prior to the certification of any tax benefits resulting from the certified capital raised through such offerings, the CAPCO shall have a securities attorney provide a written opinion that the company is in compliance with Louisiana securities laws, federal securities laws, and the securities laws of any other states where the offerings have closed. Copies of all offering materials to be used in investor solicitations must be submitted to the office at least 30 days prior to investor solicitation.

2. If a CAPCO seeks to certify capital pursuant to §303 AInvestment.a.ii, the CAPCO shall submit to the commissioner documentation showing the proposed structure in sufficient detail to allow this office to determine that the proposed structure complies with all applicable laws and regulations. This information shall be submitted to the commissioner no later than 30 days prior to a request for certification of capital.

La. Admin. Code tit. 10, § XV-311

Promulgated by the Department of Economic Development, Office of Financial Institutions, LR 20:154 (February 1994), amended, LR 23:1134 (September 1997), amended by the Department of Economic Development, Office of the Secretary and the Office of the Governor, Office of Financial Institutions, LR 30:36 (January 2004).

AUTHORITY NOTE: Promulgated in accordance with R.S. 51:1925 and 1929.