§ 78A-18. Denial and revocation of exemptions. - North Carolina Statutes

§ 78A‑18.  Denial andrevocation of exemptions.

(a)        The Administratormay by order deny or revoke any exemption specified in subdivision (9), (11),or (15) of G.S. 78A‑16 or in 78A‑17 with respect to a specificsecurity or transaction. No such order may be entered without appropriate priornotice to all interested parties, opportunity for hearing, and written findingsof fact and conclusions of law, except that the Administrator may by ordersummarily deny or revoke any of the specified exemptions pending finaldetermination of any proceeding under this section. Upon the entry of a summaryorder, the Administrator shall promptly notify all interested parties that ithas been entered and of the reasons therefor and that within 20 days of thereceipt of a written request the matter will be scheduled for hearing inaccordance with Chapter 150B of the General Statutes. If no hearing isrequested and none is ordered by the Administrator, the order will remain ineffect until it is modified or vacated by the Administrator. If a hearing isrequested or ordered, the Administrator, after notice of an opportunity forhearing to all interested persons, may not modify or vacate the order or extendit until final determination. No order under this subsection may operate retroactively.No person may be considered to have violated G.S. 78A‑24 or 78A‑49(d)by reason of any offer or sale effected after the entry of an order under thissubsection if he sustains the burden of proof that he did not know, and in theexercise of reasonable care could not have known, of the order.

(b)        In a civil oradministrative proceeding brought under this Chapter, the burden of proving anexemption or an exception from a definition is upon the person claiming it. Ina criminal proceeding brought under this Chapter, the State has no initialburden of producing evidence to show that the defendant's actions do not fallwithin the exemption or exception; however, once the defendant introducesevidence to show that his conduct is within the exemption or exception, theburden of persuading the trier of fact that the exemption or exception does notapply falls upon the State. (1925, c. 190, ss. 5, 11; 1927, c. 149, ss. 5, 11;1973, c. 1380; 1975, c. 19, s. 20; 1987, c. 849, s. 2; 1989 (Reg. Sess., 1990),c. 803, s. 2; 2001‑126, s. 1; 2001‑149, s. 2.)