b'12. File Your Securities NoticesState securities notices are generally required within 15 days of when a resident investors funds are irrevocably contractually committed to the issuer. The purpose of the state securities notice is to notify state securities agencies when anissuerhassoldsecuritiesto one ormoreinvestors within its jurisdiction. It also gives the states information and legal ju-risdiction over the issuer in the event a securities violation is found to occur at the state level. If ever investigated by a state regulator, an issuer may be required to prove that it complied with all of the requirements of Rule 506. A solid record-keeping system is needed, so that the issuer can demonstrate how it complied with all of the exemption rules. Hint:Itismorelikelythatastateregulatorwill pursueanissuerforsecuritiesviolationsthanthe SEC.Stateregulatorsregularlytalktoeachother, soifoneispursuinganissuer,theremaywillbe enforcement actions originating in other states soon thereafter. If a state notice is not filed within the specified time, or if an issuer can-not prove that it followed all of the requirements to claim the Rule 506 exemption, the states issuer exemption could be disallowed in that state. In that case, the issuer may be found to have engaged in the unlicensed sale of securities as well as the sale of unregistered securities at the state level. The issuer could be prosecuted by the states attorney general or in its state courts for violating its state securities laws.Most state securities agencies simply require that the issuer send them a copy of their Form D that was filed with the SEC, along with payment of a required filing fee. Only one notice must be filed per state regardless of the number of investors from that state. Nearly all states require the issuer of a federally exempt securities offering to file a notice with them within 15 days of the sale of the first security to an investor within their jurisdiction 43 If an offering is to be kept open to new investors for more 43 State blue sky securities laws may vary as to this timeframe and the type of no-tice required. Notice fees generally range from $0 to $300, with the average around $150, except for New York, which has filing fees of $1,100 up to $1,950.00 depend-ing on the offering amount. 141'