Stricken language would be deleted from and underlined language would be added to present law.
Act 236 of the Regular Session
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State of Arkansas 1
95th General Assembly A Bill 2
Regular Session, 2025 SENATE BILL 220 3
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By: Senator J. Boyd 5
By: Representative Achor 6
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For An Act To Be Entitled 8
AN ACT TO AMEND THE ARKANSAS SECURITIES ACT; TO 9
CLARIFY EXEMPT TRANSACTIONS UNDER THE ARKANSAS 10
SECURITIES ACT; AND FOR OTHER PURPOSES. 11
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Subtitle 14
TO AMEND THE ARKANSAS SECURITIES ACT; 15
AND TO CLARIFY EXEMPT TRANSACTIONS UNDER 16
THE ARKANSAS SECURITIES ACT. 17
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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 19
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SECTION 1. DO NOT CODIFY. This act shall be known and may be cited as 21
the "Invest Arkansas Exemption Act". 22
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SECTION 2. Arkansas Code § 23 -42-504(a)(12), concerning an exempt 24
transaction that is an offer or sale of a security by an issuer under the 25
Arkansas Securities Act, is amended to read as follows: 26
(12) An offer or sale of a security by an issuer if the offer or 27
sale of the security is conducted according to the following : 28
(A) Either of the following applies: 29
(i) The issuer of the security is a corporation or 30
other business entity organized and operating for-profit business entity 31
formed under the laws of this state and has its principal place of business 32
in Arkansas and is registered with the Secretary of State; 33
(B) the The transaction meets the requirements of the 34
federal exemption for intrastate offerings in either: 35
(i) section Section 3(a)(11) of the Securities Act 36 SB220
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of 1933, 15 U.S.C. § 77c(a)(11), as it existed on January 1, 2017 January 1, 1
2025, and Rule 147 of the United States Securities and Exchange Commission, 2
17 C.F.R. § 230.147, as it existed on January 1, 2017, and as such, the 3
securities shall be offered to and sold only to persons who are residents of 4
this state at the time of purchase January 1, 2025; or 5
(ii) The issuer of the security is a corporation or 6
other business entity with its principal place of business in Arkansas and 7
the transaction meets the requirements of the federal exemption for 8
intrastate offerings in section 28 of the Securities Exchange Act of 1933, 15 9
U.S.C. § 77z-3, as it existed on January 1, 2017, and Rule 147A of the United 10
States Securities and Exchange Commission, 17 C.F.R. § 230.147A, as it 11
existed on January 1, 2017, and as such, the securities shall be sold only to 12
persons who are residents of this state at the time of purchase January 1, 13
2025; 14
(B)(C) The sum of all cash and other consideration to be 15
received for all sales of the security in reliance upon the exemption 16
described in this subdivision (a)(12) shall not exceed one million dollars 17
($1,000,000) ten million dollars ($10,000,000) , less the aggregate amount 18
received for all sales of securities by the issuer within six (6) months 19
after the completion of the offering twelve (12) months before the first 20
offer or sale made in reliance upon this exemption ; 21
(C)(D)(i) The issuer shall not accept more than five 22
thousand dollars ($5,000) one hundred thousand dollars ($100,000) from any 23
single purchaser unless the purchaser is an accredited investor as defined by 24
Rule 501 of United States Securities and Exchange Commission Regulation D, 17 25
C.F.R. § 230.501, as it existed on January 1, 2017 January 1, 2025. 26
(ii) Two (2) or more individual purchasers residing 27
at the same primary residence who are not accredited investors and have a 28
close family relationship shall be treated as a single purchaser for purposes 29
of the monetary limit under subdivision (a)(12)(D)(i) of this section ; 30
(D) The issuer should reasonably believe that all 31
purchasers of securities are purchasing for investment and not for sale in 32
connection with a distribution of the security; 33
(E) A commission or remuneration shall not be paid or 34
given, directly or indirectly, for a person's participation in the offer or 35
sale of securities for the issuer unless the person is registered as a 36 SB220
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broker-dealer or agent under this chapter All funds received from investors 1
shall: 2
(i) Be deposited into a bank as defined in § 23 -45-3
102(a)(5)(A) authorized to do business in this state; and 4
(ii) Used according to the representations made to 5
investors; 6
(F)(i) The commissioner may by rule or order, as to any 7
security or transaction or any type of security or transaction, withdraw or 8
further condition the exemption under this subdivision (a)(12) The issuer 9
shall file a proof of exemption with the commissioner in writing at least ten 10
(10) days before securities are sold. 11
(ii) The proof of exemption under subdivision 12
(a)(12)(F)(i) of this section shall specify that the issuer is conducting an 13
offering in reliance of the exemption under this subdivision (a)(12). 14
(iii) The proof of exemption under subdivision 15
(a)(12)(F)(i) of this section shall contain: 16
(a) The name and address of the issuer; 17
(b) The name and address of all persons who 18
will be involved in the offer or sale of securities on behalf of the issuer; 19
(c) The name and address of the bank as 20
defined in § 23-45-102(a)(5)(A) into which investor funds will be deposited ; 21
and 22
(d) A copy of the offering documents to be 23
provided to each prospective purchaser in connection with the offering. 24
(G)(iv) A The issuer shall pay a filing fee of one 25
hundred dollars ($100) shall be paid to the commissioner for every proof of 26
exemption filed with the commissioner under this subdivision (a)(12) 27
(a)(12)(F)(i) of this section ;. 28
(v) If the information contained in the proof of 29
exemption filed with the commissioner under subdivision (a)(12)(F)(i) of this 30
section becomes inaccurate for any reason, the issuer shall file an amendment 31
in writing with the commissioner within sixty (60) days; 32
(G) The issuer shall inform all purchasers that the 33
securities have not been registered under this chapter and cannot be resold 34
unless the securities are: 35
(i) Registered or qualify for an exemption from 36 SB220
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registration under this section and §§ 23 -42-501 — 503; and 1
(ii) Subject to the limitation on resales contained 2
in either: 3
(a) Subsection (e) of Rule 147 of the United 4
States Securities and Exchange Commission, 17 C.F.R. 230.147(e), as it 5
existed on January 1, 2025, and in the manner described in subsection (f) of 6
Rule 147 of the United States Securities and Exchange Commission, 17 C.F.R. 7
230.147(f), as it existed on January 1, 2025; or 8
(b) Subsection (e) of Rule 147(A) of the 9
United States Securities and Exchange Commission, 17 C.F.R. 230.147A(e), as 10
it existed on January 1, 2025, and in the manner described in subsection (f) 11
of Rule 147A of the United States Securities and Exchange Commission, 17 12
C.F.R. 230.147(A)(f), as it existed on January 1, 2025; 13
(H) A commission or other remuneration shall not be paid 14
or given, directly or indirectly, for any person’s participation in the offer 15
or sale of securities for the issuer unless the person is registered as a 16
broker-dealer or agent under this chapter or a funding portal registered with 17
the Financial Industry Regulatory Authority; 18
(I) The issuer shall not be, either before or as a result 19
of the offering: 20
(i) An investment company as defined in Section 3 of 21
the Investment Company Act of 1940, 15 U.S.C. § 80a -3, as it existed on 22
January 1, 2025; 23
(ii) Subject to the reporting requirements of: 24
(a) Section 13 of the Securities and Exchange 25
Act of 1934, 15 U.S.C. § 78m, as it existed on January 1, 2025; or 26
(b) Section 15(d) of the Securities and 27
Exchange Act of 1934, 15 U.S.C. § 78o(d), as it existed on January 1, 2025; 28
or 29
(iii) Considered a blind pool or a company that has: 30
(a) Not yet defined its business operations; 31
(b) No business plan; 32
(c) No stated investment goal for the funds 33
being raised; or 34
(d) Plans to engage in a merger or acquisition 35
with an unspecified business entity; 36 SB220
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(J) The exemption under this subdivision (a)(12) shall not 1
be used in conjunction with any other exemption under this chapter except 2
for: 3
(i) The exemption to institutional investors under 4
subdivision (a)(8) of this section; and 5
(ii)(a) Offers and sales to controlling persons of 6
the issuer. 7
(b) Sales to controlling persons under 8
subdivision (a)(12)(J)(ii)(a) of this section shall not count toward the 9
limitation under subdivision (a)(12)(D) of this section; and 10
(K) The exemption under this subdivision (a)(12) shall 11
not: 12
(i) Be available if the issuer is subject to an 13
event that would disqualify an issuer under Rule 506(d)(1) of the United 14
States Securities and Exchange Commission Regulation D, 17 C.F.R. § 15
230.506(d)(1), as it existed on January 1, 2025; or 16
(ii) Be construed to alleviate a person from the 17
antifraud provisions under § 23 -42-507. 18
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APPROVED: 3/4/25 21
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