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Debt securities issued by not-for-profit organizations are not exempt from securities based on provisions of K.S.A. 17-12a201(7)(C) and K.A.R. 81-4-4 and would need to be registered before offers and sales are made in Kansas, unless a transactional exemption under K.S.A. 17-12a202 can be claimed. The limited offering exemption under subsection (14) of K.S.A. 17-12a202 may be possible for nonprofit issuers to sell securities to not more than 25 Kansas purchasers within a 12-month period if no general solicitation is used and no commissions are paid to unregistered persons. Also, the Invest Kansas Exemption (IKE) as specified by K.A.R. 81-5-21 may be possible for nonprofit corporations organized and operating in Kansas to issue up to $1,000,000 in debt securities if sales to each Kansas investor are limited to no more than $5,000 unless they qualify as an accredited investor as defined by SEC Rule 501 under Regulation D.
Invest Kansas Exemption (IKE)