For Immediate Release August 12, 2011
Securities Commissioner Aaron Jack announced today that he has adopted a new exemption that will allow Kansas businesses to raise up to $1 million from investors without going through the expensive and time-consuming process for registering the securities with the Office of the Securities Commissioner. The new exemption, called the Invest Kansas Exemption (IKE), was adopted in Kan. Admin. Reg. 81-5-21 and goes into effect today.
According to Commissioner Jack, the new exemption is intended to help small businesses survive and grow, especially in rural areas. “When a small community wants to establish a new local business, such as a grocery store or movie theater, or save a popular local business that is in financial distress, it often results in a public appeal for investors,” said Jack. “Though well-meaning, these appeals make it difficult for the company to raise capital because they disqualify the company from the normal exemptions that permit a private offering of securities without registration. We have come up with a new way to allow these types of offerings under limited circumstances, even though they involve a public solicitation of investors.” The Commissioner advises companies that are interested in utilizing the exemption to contact his office for further information and guidance.
The Office of the Kansas Securities Commissioner is charged with administration and enforcement of the Kansas Uniform Securities Act and the Kansas Loan Brokers Act. The Office investigates and prosecutes securities fraud, the offer or sale of unregistered securities, and the offer or sale of securities by unlicensed stockbrokers or investment advisers. For more information and investor education resources, visit www.ksc.ks.gov