Okla. Admin. Code § 660:11-11-2

Current through Vol. 41, No. 19, June 17, 2024

Section 660:11-11-2 - Commissions

(a)Definition. As used in Sections 1-202 and 1-402 of the Securities Act, the term "commission" shall mean any economic benefit paid or given, directly or indirectly, for the offering, selling or purchasing of a security whether in the form of money or its equivalent, or any real or personal property or interest therein, or otherwise. Such economic benefit shall be presumed to be paid or given for the offer, sale or purchase of a security if the amount of such benefit is based on the amount of securities offered, sold or purchased or is an inducement for an offer, sale or purchase.

(b)Exceptions. Notwithstanding (a) of this section, the following do not constitute a commission:

(1)Benefit for property purchased or services performed.

(A) A benefit paid or given, whether or not such benefit is paid from the proceeds of the sale of a security of an enterprise or is related to the sale of a security of an enterprise, if such benefit is paid or given for property purchased or services performed so long as:

(i) the property or services are reasonably related to the present or proposed business of the enterprise, and

(ii) the amount or value of the benefit paid or given is competitive with the amounts charged or paid in the same or comparable areas by persons not affiliated with the enterprise who are engaged in the business of rendering comparable services or providing comparable property.

(B) Payment to independent third party professional engineers, geologists, accountants, attorneys, or such other persons for professional services rendered or to be rendered for the enterprise does not constitute a commission.

(2)Promotional or other interest of sponsor.

(A) Any promotional or other interest of a sponsor of an enterprise in the revenues, assets or equity of the enterprise which is proportionately greater than the capital invested by such sponsor in the enterprise or the total costs and expenses of the enterprise borne by or charged to such sponsor, if:

(i) the interest received is reasonable or customary in the industry in which the enterprise operates or proposes to operate; and

(ii) the sponsor or entity receiving such interest has or will have substantial duties unrelated to the sale of a security in connection with the enterprise.

(B) For the purpose of this paragraph, the type and amount of interests allowed under any applicable guidelines adopted by NASAA or any other guidelines adopted by the Department for public offerings registered with the Department shall be presumed reasonable and customary.

(3)Compensation to officer, director, partner or employee. The payment of compensation to an officer, director, partner or employee of an enterprise or its sponsor if:

(A) such payment is not directly or indirectly related to the offer or sale of a security;

(B) the officer, director, partner or employee is a bona fide officer, director, partner or employee who has substantial duties that are unrelated to the sale of a security; and

(C) the officer, director, partner or employee's activity involving the offer or sale of a security is strictly incidental to such person's bona fide primary work duties.

(c)Presumptions. No presumption shall arise that a benefit constitutes a commission if the relevant conditions described in (b) of this section are not satisfied. The burden of proving that the conditions of this rule have been met remains with the person claiming an exemption addressed by this rule.

Okla. Admin. Code § 660:11-11-2

Added at 21 Ok Reg 2532, eff 7-1-04