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State Blue Sky Regulation

At the federal level, sales of securities are subject to the Securities Act of 1933 (“Securities Act”) and the SEC rules enacted thereunder.  Sales of securities are also regulated at the individual state level under state securities laws, often called “Blue Sky” laws.  Each state’s respective Blue Sky laws apply to offers and sales of securities within the state.

Although states are prohibited from requiring the registration of securities exempt from registration under the Securities Act, states may require issuers of securities to make notice filings concerning the securities they sell.  These required notice filings, often called “Blue Sky Notice Filings,” inform each state’s securities division of the type of business being conducted (directly or indirectly) within the state.  Hedge funds must make a Blue Sky Notice Filing in each state in which one of its investors resides.  In most cases, Blue Sky Notice Filings must be made with respect to a fund within fifteen days of the date of first sale within each state.  New York, a notable exception, requires that a Blue Sky “pre-filing” be made before any securities are sold within the state.

Before making a Blue Sky Notice Filing on your behalf, most hedge fund attorneys will require that you provide them with the following: 1) each investor’s name; 2) each investor’s state of residence; 3) the amount of each investor’s investment(s); and 4) the date of first sale within each state.

Blue Sky Notice Filings can be an extensive and complicated process, especially since each state imposes its own requirements and fees.  For reference, below are the respective Blue Sky Notice Filing fees and form requirements for each state as of the date of this post:

Alabama

Filing Fee: $300

Required Form(s): Manual Form D

Alaska

Filing Fee: $600-$1,100

Required Form(s): Electronic Form D

Arizona

Filing Fee: $250

Required Form(s): Electronic Form D

California

Filing Fee: $300

Required Form(s): Electronic Form D, Form U-2

Colorado

Filing Fee: $75

Required Form(s): Electronic Form D with original signature

Connecticut

Filing Fee: $150

Required Form(s): Electronic or Manual Form D

Delaware

Filing Fee: None

Required Form(s): Electronic Form D, Form U-2

Florida

*No Blue Sky Notice Filing Required*

Georgia

Filing Fee: $250

Required Form(s): Electronic Form D, Form U-2

Hawaii

Filing Fee: $100

Required Form(s): Electronic or Manual Form D, Form U-2

Idaho

Filing Fee: $50

Required Form(s): Electronic Form D, Form U-2

Illinois

Filing Fee: $100

Required Form(s): Electronic Form D

Indiana

Filing Fee: None

Required Form(s): Manual Form D

Iowa

Filing Fee: $100

Required Form(s): Electronic Form D, Form U-2

Kansas

Filing Fee: $250

Required Form(s): Electronic or Manual Form D

Kentucky

Filing Fee: $250

Required Form(s): Electronic Form D, Form U-2

Louisiana

Filing Fee: $300

Required Form(s): Electronic Form D, Form U-2

Maine

Filing Fee: $300

Required Form(s): Electronic Form D, Form U-2

Maryland

Filing Fee: $100

Required Form(s): Electronic Form D, Form U-2

Michigan

Filing Fee: $100

Required Form(s): Electronic Form D

Minnesota

Filing Fee: $100 +

Required Form(s): Electronic Form D, Form U-2

Mississippi

Filing Fee: $300

Required Form(s): Electronic or Manual Form D, Form U-2

Missouri

Filing Fee: $100

Required Form(s): Electronic Form D

Montana

Filing Fee: $200 +

Required Form(s): Electronic Form D, Form U-2

Nebraska

Filing Fee: $200

Required Form(s): Electronic Form D

Nevada

Filing Fee: $500

Required Form(s): Electronic or Manual Form D

New Hampshire

Filing Fee: $500

Required Form(s): Form

New Mexico

Filing Fee: $350

Required Form(s): Electronic Form D with authentication email, Form U-2

New York

Filing Fee: $1,200 (NYS Dept. of Law), $35 & $150 (Department of State)

Note: Must be paid with 3 separate checks

Required Form(s): Electronic Form D, Form U-2 (one original, one copy)

North Carolina

Filing Fee: $350

Required Form(s): Electronic Form D

North Dakota

Filing Fee: $100

Required Form(s): Electronic Form D

Ohio

Filing Fee: $100

Required Form(s): Electronic Form D, Form U-2

Oklahoma

Filing Fee: $250

Required Form(s): Electronic Form D, Form U-2

Oregon

Filing Fee: $250

Required Form(s): Electronic Form D

Rhode Island

Filing Fee: $300

Required Form(s): Electronic Form D, Form U-2

South Carolina

Filing Fee: $300

Required Form(s): Electronic Form D

South Dakota

Filing Fee: $250

Required Form(s): Electronic Form D

Tennessee

Filing Fee: $500

Required Form(s): Electronic Form D

Texas

Filing Fee: up to $500

Required Form(s): Electronic Form D

Utah

Filing Fee: $100

Required Form(s): Electronic or Manual Form D with original signature

Vermont

Filing Fee: $600

Required Form(s): Electronic Form D, Form U-2

Virginia

Filing Fee: $250

Required Form(s): Electronic or Manual Form D

Washington

Filing Fee: $300

Required Form(s): Electronic Form D

West Virginia

Filing Fee: $125

Required Form(s): Electronic Form D, Form U-2

Wisconsin

Filing Fee: $200

Required Form(s): Electronic Form D

Wyoming

Filing Fee: $200

Required Form(s): Electronic Form D with original signature underneath electronic signature

 

Please contact us if you would like assistance with your fund’s Blue Sky Notice Filings or have any questions regarding the process in general.