The BIDCO
Act was passed by Alaska's Legislature to promote economic
development by encouraging the formation of a business entity
whose purpose
would be to provide financial and management assistance for other
businesses in the state. The Banking Section provides for licensing,
regulation, and enforcement to enable a BIDCO to satisfy the eligibility
requirements for participating in programs that further the purposes
of BIDCOs; to prevent fraud, conflict of interest, and mismanagement;
and to promote competent management, accurate record keeping, and
appropriate communication with shareholders;
An application to the Division shall
provide information on the directors, officers, and controlling
persons of the applicant. The application must also set a business
plan, with at least 10 years of detailed financial projections
including the following:
- an applicant must demonstrate to
the satisfaction of the department that the applicant has raised
sufficient capital so that
- the net worth of the BIDCO
is expected to be adequate, in the context of its business
plan, to support the BIDCO's management team and to achieve
an appropriate spreading of the risk involved in the BIDCO's
provisions of financing assistance; and
- the BIDCO has a reasonable
promise of being a viable, ongoing BIDCO, satisfying the
basic objectives of its business plan and achieving long-term
financial success.
Unless the BIDCO receives a loan under AS
37.17.200 - 37.17.390, the department may not establish a minimum
net worth for a BIDCO under this section of less than $1,500,000. If
the BIDCO, as part of its initial capitalization, receives a loan under
AS 37.17.200 - 37.17.390, the minimum net worth of the BIDCO may be
$500,000, excluding organization costs paid for or owed by the BIDCO.
A BIDCO license may only be issued if
the department determines that each director, officer, and controlling
person of the applicant is
- of good character and sound financial
standing;
- competent to perform the director's
or officer's functions for the applicant; and
- when considered collectively with
the other directors, officers, and controlling persons, adequate
to manage the business of the applicant as a BIDCO.
The department may determine that a director,
officer, or controlling person of an applicant is not of good character.
Bases the department may use to make that determination include proof
that the director, officer, or controlling person, or a director or
officer of a controlling person has
- had an administrative sanction imposed
under 31 U.S.C. 3801 - 3812 (Program Fraud Civil Remedies Act
of 1986) for an offense under 15 U.S.C. 645; or
- been convicted of a crime involving
fraud or dishonesty, including a conviction for an offense
under 15 U.S.C. 645; in this paragraph, "conviction" includes
a conviction based on a guilty plea or plea of nolo contendere.
For application forms, contact
The
Division of Banking and Securities
P.O. Box 110807
Juneau, AK 99811-0807
(907) 465-2521
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