Or. Admin. R. 441-065-0090

Current through Register Vol. 63, No. 8, August 1, 2024

Section 441-065-0090 - Integration

Unless otherwise specified in this rule, all separate sales that are a part of the same SOAR or SCOR Offering shall be counted and included as securities sold under the SOAR or SCOR Offering:

(1) A separate sale of securities within or without this state will be included as part of the same SOAR or SCOR Offering if, after considering the following elements, there are compelling reasons to treat the sale as part of the same offering. The elements to be considered are:

(a) Whether the sales are part of a single plan of financing;

(b) Whether the sales involved issuance of the same class of security;

(c) Whether the sales are made at or about the same time;

(d) Whether the same type of consideration is received; and

(e) Whether the sales are made for the same general purpose.

(2) Exclusion of Certain Employee Benefit Plans. Offers and sales of securities under an Employee Benefit Plan as defined by OAR 441-065-0070(5) are not included as sales under this rule.

(3) Safe harbor by absence of sales. Sales of securities made more than six months prior to the effective date of registration of a SOAR or SCOR Offering, or more than six months after the termination of a SOAR or SCOR Offering will not be considered to have been made as part of the same SOAR or SCOR Offering under this rule.

(4) Safe harbor for "discrete offerings" of partnership interests. Offerings of interests in a partnership shall not be included as securities sold under the same offering under a SOAR or SCOR Offering, even where there is a common sponsor or affiliate involved in offerings of interests in another entity, if all of the conditions of subsections (4)(b) through (f) of this rule are satisfied:

(a) As used in this section, the following definitions are applicable:

(A) A "partnership" includes a general partnership, limited partnership, joint venture or other similar entity. A "partnership" includes existing entities as well as those that are to be formed in the future;

(B) A "sponsor" is a promoter or any person directly or indirectly instrumental in organizing the partnership in whole or in part, or any person who will manage or participate in the management of the partnership. A "sponsor" includes a general partner and affiliate of the sponsor. A "sponsor" does not include independent third parties such as attorneys, accountants, and underwriters whose only compensation is for professional services rendered in connection with offering of interests in the partnership.

(b) Separate entity. The partnership must:

(A) Be a separate legal entity;

(B) Have separate books and records;

(C) Not commingle funds of the partnership with those of the sponsor or any other entity having the same sponsor.

(c) Economic independence. The partnership at the time the interests are sold must have the independent ability to meet its primary investment objective. If the partnership is substantially dependent on the creation, continued existence or economic results of investments of another entity having a common sponsor, then the partnership does not have the independent ability to meet its primary investment objective.

(d) Application of proceeds. No material portion of the gross offering proceeds of the partnership shall be invested in properties where another entity having a common sponsor has also invested and continues to hold invested, a material portion of its gross offering proceeds.

(e) Unspecified programs. An offering that does not identify at least 50 percent of the assets in which the partnership intends to invest does not qualify under this safe harbor if:

(A) Another entity with a common sponsor was formed to conduct the same general type of activity and that entity has not invested or committed the major portion of its gross offering proceeds prior to commencement of this offering by the registering partnership; or

(B) The sponsor creates a simultaneous or subsequent offering through another entity to conduct the same general type of activity before the registering partnership has invested or committed for investment the major portion of its gross offering proceeds. This paragraph does not apply if the investment to be made by the other entity is fully identified.

(f) An offering of interests in a partnership that is formed to engage in sale and leaseback transactions does not qualify under this safe harbor if the ultimate intended lessee of the assets in which the partnership invests is a sponsor of the partnership.

(5) Safe harbor by order of registration:

(a) Applicants desiring the Director's concurrence of non-integration under section (1) of this rule or applicability of the safe harbors in section (3) or (4) of this rule shall file a written request with their application for registration. A request must contain an analysis of the law applicable to the facts;

(b) The Director may take the position that further action is required or decline to take a position if the analysis is not sufficient to make a determination. If the Director concludes that the separate sales should not be integrated, the Director will issue an Order or Registration that expressly excludes those sales;

(6) No presumptions related to integration under (1) are created by the non-availability of safe harbors under section (3), (4), or (5) of this rule.

Or. Admin. R. 441-065-0090

CC 9-1982(Temp), f. 4-7-82, ef. 4-15-82; CC 11-1982, f. 8-11-82, ef. 10-10-82; FCS 11-1988(Temp), f. & cert. ef. 6-2-88; Renumbered from 815-036-0015; FCS 15-1988, f. & ef. 11-21-88; FCS 4-1992, f. & cert. ef. 10-1-92; FCS 2-1998, f. & cert. ef. 4-30-98; FCS 4-1998, f. & cert. ef. 8-5-98; FSR 5-2018, amend filed 04/26/2018, effective5/1/2018

Statutory/Other Authority: ORS 59.065

Statutes/Other Implemented: ORS 59.065