Blue Sky Q&A, Regulation D Rule 506 Offering: Alabama | Practical Law

Blue Sky Q&A, Regulation D Rule 506 Offering: Alabama | Practical Law

A Q&A guide for Alabama state blue sky filings for unregistered offerings under Rule 506 of Regulation D under the Securities Act. This is one of a series of state Q&A guides providing key information for issuers making state-level NSMIA notice filings for a Rule 506 offering, including filing deadlines, mailing addresses, state statutory authority and filing fees. These guides should be used together with Standard Document, Blue Sky Filing Cover Letter, Regulation D Rule 506 Offering.

Blue Sky Q&A, Regulation D Rule 506 Offering: Alabama

Practical Law Article 6-580-5585 (Approx. 4 pages)

Blue Sky Q&A, Regulation D Rule 506 Offering: Alabama

by Practical Law Corporate & Securities
Law stated as of 31 Jul 2018 • Alabama
A Q&A guide for Alabama state blue sky filings for unregistered offerings under Rule 506 of Regulation D under the Securities Act. This is one of a series of state Q&A guides providing key information for issuers making state-level NSMIA notice filings for a Rule 506 offering, including filing deadlines, mailing addresses, state statutory authority and filing fees. These guides should be used together with Standard Document, Blue Sky Filing Cover Letter, Regulation D Rule 506 Offering.
1. What is the deadline for the blue sky filing in this state?
The filing must be made within 15 days of the first sale of securities in the state.
2. What state agency regulates securities offerings in this state? What is the mailing address and telephone number for the state securities regulator?
The state securities regulator in Alabama is the Alabama Securities Commission.
Alabama Securities Commission
401 Adams Ave., Suite 280
Montgomery, AL 36104
(334) 242-2984
3. What is the statutory authority under which the blue sky filing must be made?
The filing requirement is set out in Section 8-6-11(a)(9) of the Alabama Securities Act (Ala.Code 1975 § 8-6-11(a)(9)), rule 830-X-6.11 thereunder (Ala. Admin. Code r. 830-X-6-.11), and the Alabama Securities Commission's Policy Statement Concerning Limited Offering Exemption Filings Made Pursuant to SEC Rules 504, 505 and 506 of Regulation D (June 6, 1998).
Practitioners should note that item 4 of the first section of the Alabama Securities Commission's June 6, 1998 Policy Statement (relating to Rule 506) includes a request that the issuer submit with its notice filing "[o]ne copy of all documents to be distributed to offerees." The Policy Statement states that item 4 is not mandatory, but is requested strictly for informational purposes and that the Alabama Securities Commission staff will not review or comment on any offering documents.
Practitioners should note that the Policy Statement also includes a request that the issuer file a notice upon the termination of the offering.
4. Does a notice on Form D have to be filed with the state securities regulator?
A notice on Form D must be filed. See Practice Note, Form D: Notice of Exempt Offering of Securities.
5. Does the state participate in the Electronic Filing Depository (EFD) system established by the North American Securities Administrators Association (NASAA) and, if so, is the filer's use of the EFD system optional or mandatory?
Alabama participates in the EFD system, but filers are not required to use the EFD at this time. Filers may submit the Form D and pay the filing fee by mail or through the EFD.
This Q&A guide will be updated as appropriate if use of the EFD system becomes mandatory in Alabama.
6. Does a separate consent to service of process have to be filed with the state authorities? If so, what is the identity of the designated appointee?
Most states require a non-resident issuer to consent to having the appropriate state authority designated to receive service of process on its behalf for any actions arising out of violations of the blue sky law of that state. The electronic Form D includes a combined federal-state consent to service of process that was intended to eliminate the need to file a Form U-2, Uniform Consent to Service of Process at the state level (see SEC Release No. 33-8891 (Feb. 6, 2008), at Part II.A.6). However, there are still some states that, because of their laws, continue to require that issuers submit a separate Form U-2, although the trend is in the direction of eliminating this redundant filing requirement. See Practice Note, Form D: Notice of Exempt Offering of Securities.
In Alabama there is no requirement to file a separate consent to service of process.
7. Is there a filing fee? If so, what is the amount and who is the payee?
A filing fee of $300 (flat rate) is payable at the time of filing. The fee is payable to the Alabama Securities Commission.