Simple English definitions for legal terms
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Bad-Boy Provision: A rule that says certain people who have done bad things in the past cannot get special treatment when selling investments. This rule usually stops people who have been in trouble for cheating with money from being involved in a small sale of investments.
A bad-boy provision is a clause in securities law that prevents certain individuals from receiving exemptions from registering their securities due to their past conduct. This provision is typically included in blue-sky laws and prohibits individuals who have been involved in adverse proceedings related to securities, commodities, or postal fraud from participating in limited offerings.
These examples illustrate how the bad-boy provision works by preventing individuals with a history of misconduct from participating in certain securities offerings. This helps protect investors by ensuring that only trustworthy individuals are involved in the sale of securities.