Senate Bill No. 124–Committee on Judiciary

(On Behalf of Secretary of State)

February 4, 1999

____________

Referred to Committee on Judiciary

 

SUMMARY—Makes various changes to provisions governing securities. (BDR 7-658)

FISCAL NOTE: Effect on Local Government: No.

Effect on the State or on Industrial Insurance: No.

~

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

 

AN ACT relating to securities; making various changes to the provisions governing securities; removing the exemption for certain transactions by mortgage companies from the requirements regarding registration of securities; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

1-1 Section 1. NRS 90.350 is hereby amended to read as follows:

1-2 90.350 1. An applicant for licensing as a broker-dealer, sales

1-3 representative, investment adviser or representative of an investment

1-4 adviser must file with the administrator an application for licensing and a

1-5 consent to service of process pursuant to NRS 90.770 and pay the fee

1-6 required by NRS 90.360. The application for licensing must contain the

1-7 social security number of the applicant and any other information the

1-8 administrator determines by regulation to be necessary and appropriate to

1-9 facilitate the administration of this chapter.

1-10 2. The requirements of subsection 1 are satisfied by an applicant who

1-11 has filed and maintains a completed and current registration with the

1-12 Securities and Exchange Commission or a self-regulatory organization if

1-13 the information contained in that registration is readily available to the

1-14 administrator through [a central depository system] the central registration

1-15 depository or another depository for registrations that has been approved

1-16 by [him.] the administrator by regulation or order. Such an applicant must

1-17 also file a notice with the administrator in the form and content determined

2-1 by the administrator by regulation and a consent to service of process

2-2 pursuant to NRS 90.770 and the fee required by NRS 90.360. The

2-3 administrator, by order, may require the submission of additional

2-4 information by an applicant.

2-5 3. As used in this section, "central registration depository" means the

2-6 Central Registration Depository of the National Association of Securities

2-7 Dealers and the North American Securities Administrators Association.

2-8 Sec. 2. NRS 90.380 is hereby amended to read as follows:

2-9 90.380 1. Unless a proceeding under NRS 90.420 has been instituted,

2-10 the license of any broker-dealer, sales representative, investment adviser or

2-11 representative of an investment adviser becomes effective 30 days after an

2-12 application for licensing has been filed and is complete, including any

2-13 amendment, if all requirements imposed pursuant to NRS 90.370 and

2-14 90.375 have been satisfied. An application or amendment is complete when

2-15 the applicant has furnished information responsive to each applicable item

2-16 of the application. The administrator may [by order] authorize an earlier

2-17 effective date of licensing.

2-18 2. The license of a broker-dealer, sales representative, investment

2-19 adviser or representative of an investment adviser is effective until

2-20 terminated by revocation, suspension, expiration or withdrawal.

2-21 3. The license of a sales representative is only effective with respect to

2-22 transactions effected on behalf of the broker-dealer or issuer for whom the

2-23 sales representative is licensed.

2-24 4. A person shall not at any one time act as a sales representative for

2-25 more than one broker-dealer or for more than one issuer, unless the

2-26 administrator by regulation or order authorizes multiple licenses.

2-27 5. If a person licensed as a sales representative terminates association

2-28 with a broker-dealer or issuer or ceases to be a sales representative, the

2-29 sales representative and the broker-dealer or issuer on whose behalf the

2-30 sales representative was acting shall promptly notify the administrator.

2-31 6. The administrator by regulation may authorize one or more special

2-32 classifications of licenses as a broker-dealer, sales representative,

2-33 investment adviser or representative of an investment adviser to be issued

2-34 to applicants subject to limitations and conditions on the nature of the

2-35 activities that may be conducted by persons so licensed.

2-36 7. The license of a broker-dealer, sales representative, investment

2-37 adviser or representative of an investment adviser expires if:

2-38 (a) The statement required pursuant to NRS 90.375 is not submitted

2-39 when it is due; or

2-40 (b) The annual fee required by NRS 90.360 is not paid when it is due.

2-41 8. A license that has expired may be reinstated retroactively if the

2-42 licensed person:

2-43 (a) Submits the statement required pursuant to NRS 90.375; and

3-1 (b) Pays the fee required by NRS 90.360, plus a fee for reinstatement in

3-2 the amount of $25,

3-3 within 30 days after the date of expiration. If the license is not reinstated

3-4 within that time, it shall be deemed to have lapsed as of the date of

3-5 expiration, and the licensed person must thereafter submit a new

3-6 application for licensing if he desires to be relicensed.

3-7 Sec. 3. NRS 90.420 is hereby amended to read as follows:

3-8 90.420 1. The administrator by order may deny, suspend or revoke

3-9 any license, fine any licensed person , [or essential employee,] limit the

3-10 activities governed by this chapter that an applicant [,] or licensed person

3-11 [or essential employee] may perform in this state, bar an applicant [,] or

3-12 licensed person [or essential employee] from association with a licensed

3-13 broker-dealer or investment adviser or bar from employment with a

3-14 licensed broker-dealer or investment adviser a person who is a partner,

3-15 officer, director, sales representative, investment adviser or representative

3-16 of an investment adviser, or a person occupying a similar status or

3-17 performing a similar function for an applicant or licensed person, if the

3-18 administrator finds that the order is in the public interest and that the

3-19 applicant or licensed person or, in the case of a broker-dealer or investment

3-20 adviser, any partner, officer, director, sales representative, investment

3-21 adviser, representative of an investment adviser or person occupying a

3-22 similar status or performing similar functions or any person directly or

3-23 indirectly controlling the broker-dealer or investment adviser:

3-24 (a) Has filed an application for licensing with the administrator which,

3-25 as of its effective date, or as of any date after filing in the case of an order

3-26 denying effectiveness, was incomplete in a material respect or contained a

3-27 statement that was, in light of the circumstances under which it was made,

3-28 false or misleading with respect to a material fact;

3-29 (b) Has violated or failed to comply with a provision of this chapter as

3-30 now or formerly in effect or a regulation or order adopted or issued under

3-31 this chapter;

3-32 (c) Is the subject of an adjudication or determination after notice and

3-33 opportunity for hearing, within the last 5 years by a securities agency or

3-34 administrator of another state or a court of competent jurisdiction that the

3-35 person has violated the Securities Act of 1933, the Securities Exchange Act

3-36 of 1934, the Investment Advisers Act of 1940, the Investment Company

3-37 Act of 1940, the Commodity Exchange Act or the securities law of any

3-38 other state, but only if the acts constituting the violation of that state’s law

3-39 would constitute a violation of this chapter had the acts taken place in this

3-40 state;

3-41 (d) Within the last 10 years has been convicted of a felony or

3-42 misdemeanor which the administrator finds:

4-1 (1) Involves the purchase or sale of a security, taking a false oath,

4-2 making a false report, bribery, perjury, burglary, robbery or conspiracy to

4-3 commit any of the foregoing offenses;

4-4 (2) Arises out of the conduct of business as a broker-dealer,

4-5 investment adviser, depository institution, insurance company or fiduciary;

4-6 or

4-7 (3) Involves the larceny, theft, robbery, extortion, forgery,

4-8 counterfeiting, fraudulent concealment, embezzlement, fraudulent

4-9 conversion or misappropriation of money or securities or conspiracy to

4-10 commit any of the foregoing offenses;

4-11 (e) Is or has been permanently or temporarily enjoined by any court of

4-12 competent jurisdiction, unless the order has been vacated, from acting as an

4-13 investment adviser, representative of an investment adviser, underwriter,

4-14 broker-dealer or as an affiliated person or employee of an investment

4-15 company, depository institution or insurance company or from engaging in

4-16 or continuing any conduct or practice in connection with any of the

4-17 foregoing activities or in connection with the purchase or sale of a security;

4-18 (f) Is or has been the subject of an order of the administrator, unless the

4-19 order has been vacated, denying, suspending or revoking his license as a

4-20 broker-dealer, sales representative, investment adviser or representative of

4-21 an investment adviser;

4-22 (g) Is or has been the subject of any of the following orders which were

4-23 issued within the last 5 years, unless the order has been vacated:

4-24 (1) An order by the securities agency or administrator of another

4-25 state, Canadian province or territory or by the Securities and Exchange

4-26 Commission or a comparable regulatory agency of another country, entered

4-27 after notice and opportunity for hearing, denying, suspending or revoking

4-28 the person’s license as a broker-dealer, sales representative, investment

4-29 adviser or representative of an investment adviser;

4-30 (2) A suspension or expulsion from membership in or association

4-31 with a member of a self-regulatory organization;

4-32 (3) An order of the United States Postal Service relating to fraud;

4-33 (4) An order to cease and desist entered after notice and opportunity

4-34 for hearing by the administrator, the securities agency or administrator of

4-35 another state, Canadian province or territory, the Securities and Exchange

4-36 Commission or a comparable regulatory agency of another country, or the

4-37 Commodity Futures Trading Commission; or

4-38 (5) An order by the Commodity Futures Trading Commission

4-39 denying, suspending or revoking registration under the Commodity

4-40 Exchange Act;

4-41 (h) Has engaged in unethical or dishonest practices in the securities

4-42 business;

5-1 (i) Is insolvent, either in the sense that liabilities exceed assets or in the

5-2 sense that obligations cannot be met as they mature, but the administrator

5-3 may not enter an order against a broker-dealer or investment adviser under

5-4 this subparagraph without a finding of insolvency as to the broker-dealer or

5-5 investment adviser;

5-6 (j) Is determined by the administrator in compliance with NRS 90.430

5-7 not to be qualified on the basis of lack of training, experience and

5-8 knowledge of the securities business; or

5-9 (k) Has failed reasonably to supervise a sales representative [or

5-10 employee.] , employee or representative of an investment adviser.

5-11 2. The administrator may not institute a proceeding on the basis of a

5-12 fact or transaction known to the director when the license became effective

5-13 unless the proceeding is instituted within 90 days after issuance of the

5-14 license.

5-15 3. If the administrator finds that an applicant or licensed person is no

5-16 longer in existence or has ceased to do business as a broker-dealer, sales

5-17 representative, investment adviser or representative of an investment

5-18 adviser or is adjudicated mentally incompetent or subjected to the control

5-19 of a committee, conservator or guardian or cannot be located after

5-20 reasonable search, the administrator may by order deny the application or

5-21 revoke the license.

5-22 [4. As used in this section, "essential employee" means a person

5-23 performing the function of a representative of an investment adviser or

5-24 sales representative, or a similar function, for a licensed person. The term

5-25 does not include an investment adviser, sales representative or

5-26 representative of an investment adviser who holds a license or registration

5-27 issued in accordance with the provisions of this chapter.]

5-28 Sec. 4. NRS 90.440 is hereby amended to read as follows:

5-29 90.440 1. An application for a license may be withdrawn by the

5-30 applicant without prejudice before the license becomes effective.

5-31 2. Withdrawal from licensing as a broker-dealer, sales representative,

5-32 investment adviser or representative of an investment adviser becomes

5-33 effective 30 days after receipt by the administrator of an application to

5-34 withdraw or within such shorter period as the administrator determines,

5-35 unless:

5-36 (a) A proceeding to revoke or suspend is pending when the application

5-37 is filed;

5-38 (b) A proceeding to revoke or suspend or to impose conditions upon the

5-39 withdrawal is instituted within 30 days after the application is filed; or

5-40 (c) Additional information is requested by the administrator regarding

5-41 the application.

5-42 3. If a proceeding is pending or instituted under subsection 2,

5-43 withdrawal becomes effective at the time and upon the conditions the

6-1 administrator by order determines. If additional information is requested,

6-2 withdrawal is effective 30 days after the additional information is filed.

6-3 Although no proceeding is pending or instituted and withdrawal becomes

6-4 effective, the administrator may institute a proceeding pursuant to NRS

6-5 90.420 within [1 year] 2 years after withdrawal became effective and enter

6-6 an order as of the last date on which licensing was effective.

6-7 Sec. 5. NRS 90.530 is hereby amended to read as follows:

6-8 90.530 The following transactions are exempt from NRS 90.460 and

6-9 90.560:

6-10 1. An isolated nonissuer transaction, whether or not effected through a

6-11 broker-dealer.

6-12 2. A nonissuer transaction in an outstanding security if the issuer of the

6-13 security has a class of securities subject to registration under section 12 of

6-14 the Securities Exchange Act of 1934 and has been subject to the reporting

6-15 requirements of section 13 or [15(d)] 15(c) of the Securities Exchange Act

6-16 of 1934 for not less than 90 days next preceding the transaction, or has filed

6-17 and maintained with the administrator for not less than 90 days preceding

6-18 the transaction information, in such form as the administrator, by

6-19 regulation, specifies, substantially comparable to the information the issuer

6-20 would be required to file under section 12(b) or 12(g) of the Securities

6-21 Exchange Act of 1934 were the issuer to have a class of its securities

6-22 registered under section 12 of the Securities Exchange Act of 1934 and

6-23 paid a fee with the filing of $150.

6-24 3. A nonissuer transaction by a sales representative licensed in this

6-25 state, in an outstanding security if:

6-26 (a) The security is sold at a price reasonably related to the current

6-27 market price of the security at the time of the transaction;

6-28 (b) The security does not constitute all or part of an unsold allotment to,

6-29 or subscription or participation by, a broker-dealer as an underwriter of the

6-30 security;

6-31 (c) At the time of the transaction, a recognized securities manual

6-32 designated by the administrator by regulation or order contains the names

6-33 of the issuer’s officers and directors, a statement of the financial condition

6-34 of the issuer as of a date within the preceding 18 months, and a statement of

6-35 income or operations for each of the last 2 years next preceding the date of

6-36 the statement of financial condition, or for the period as of the date of the

6-37 statement of financial condition if the period of existence is less than 2

6-38 years;

6-39 (d) The issuer of the security has not undergone a major reorganization,

6-40 merger or acquisition within the preceding 30 days which is not reflected in

6-41 the information contained in the manual; and

6-42 (e) At the time of the transaction, the issuer of the security has a class of

6-43 equity security listed on the New York Stock Exchange, American Stock

7-1 Exchange or other exchange designated by the administrator, or on the

7-2 National Market System of the National Association of Securities Dealers

7-3 Automated Quotation System. The requirements of this paragraph do not

7-4 apply if:

7-5 (1) The security has been outstanding for at least 180 days;

7-6 (2) The issuer of the security is actually engaged in business and is

7-7 not developing his business, in bankruptcy or in receivership; and

7-8 (3) The issuer of the security has been in continuous operation for at

7-9 least 5 years.

7-10 4. A nonissuer transaction in a security that has a fixed maturity or a

7-11 fixed interest or dividend provision if there has been no default during the

7-12 current fiscal year or within the 3 preceding years, or during the existence

7-13 of the issuer, and any predecessors if less than 3 years, in the payment of

7-14 principal, interest or dividends on the security.

7-15 5. A nonissuer transaction effected by or through a registered broker-

7-16 dealer pursuant to an unsolicited order or offer to purchase.

7-17 6. A transaction between the issuer or other person on whose behalf the

7-18 offering of a security is made and an underwriter, or a transaction among

7-19 underwriters.

7-20 7. A transaction in a bond or other evidence of indebtedness secured by

7-21 a real estate mortgage, deed of trust, personal property security agreement,

7-22 or by an agreement for the sale of real estate or personal property, if the

7-23 entire mortgage, deed of trust or agreement, together with all the bonds or

7-24 other evidences of indebtedness secured thereby, is offered and sold as a

7-25 unit.

7-26 8. A transaction by an executor, administrator, sheriff, marshal,

7-27 receiver, trustee in bankruptcy, guardian or conservator.

7-28 9. A transaction executed by a bona fide secured party without the

7-29 purpose of evading this chapter.

7-30 10. An offer to sell or sale of a security to a financial or institutional

7-31 investor or to a broker-dealer.

7-32 11. Except as otherwise provided in this subsection, a transaction

7-33 pursuant to an offer to sell securities of an issuer if:

7-34 (a) The transaction is part of an issue in which there are no more than 25

7-35 purchasers in this state, other than those designated in subsection 10, during

7-36 any 12 consecutive months;

7-37 (b) No general solicitation or general advertising is used in connection

7-38 with the offer to sell or sale of the securities;

7-39 (c) No commission or other similar compensation is paid or given,

7-40 directly or indirectly, to a person, other than a broker-dealer licensed or not

7-41 required to be licensed under this chapter, for soliciting a prospective

7-42 purchaser in this state; and

7-43 (d) One of the following conditions is satisfied:

8-1 (1) The seller reasonably believes that all the purchasers in this state,

8-2 other than those designated in subsection 10, are purchasing for investment;

8-3 or

8-4 (2) Immediately before and immediately after the transaction, the

8-5 issuer reasonably believes that the securities of the issuer are held by 50 or

8-6 fewer beneficial owners, other than those designated in subsection 10, and

8-7 the transaction is part of an aggregate offering that does not exceed

8-8 $500,000 during any 12 consecutive months.

8-9 The administrator by rule or order as to a security or transaction or a type

8-10 of security or transaction, may withdraw or further condition the exemption

8-11 set forth in this subsection or waive one or more of the conditions of the

8-12 exemption.

8-13 12. An offer to sell or sale of a preorganization certificate or

8-14 subscription if:

8-15 (a) No commission or other similar compensation is paid or given,

8-16 directly or indirectly, for soliciting a prospective subscriber;

8-17 (b) No public advertising or general solicitation is used in connection

8-18 with the offer to sell or sale;

8-19 (c) The number of offers does not exceed 50;

8-20 (d) The number of subscribers does not exceed 10; and

8-21 (e) No payment is made by a subscriber.

8-22 13. An offer to sell or sale of a preorganization certificate or

8-23 subscription issued in connection with the organization of a depository

8-24 institution if that organization is under the supervision of an official or

8-25 agency of a state or of the United States which has and exercises the

8-26 authority to regulate and supervise the organization of the depository

8-27 institution. For the purpose of this subsection, "supervision of the

8-28 organization by an official or agency" means that the official or agency by

8-29 law has authority to require disclosures to prospective investors similar to

8-30 those required under NRS 90.490, impound proceeds from the sale of a

8-31 preorganization certificate or subscription until organization of the

8-32 depository institution is completed, and require refund to investors if the

8-33 depository institution does not obtain a grant of authority from the

8-34 appropriate official or agency.

8-35 14. A transaction pursuant to an offer to sell to existing security

8-36 holders of the issuer, including persons who at the time of the transaction

8-37 are holders of transferable warrants exercisable within not more than 90

8-38 days after their issuance, convertible securities or nontransferable warrants,

8-39 if:

8-40 (a) No commission or other similar compensation other than a standby

8-41 commission, is paid or given, directly or indirectly, for soliciting a security

8-42 holder in this state; or

9-1 (b) The issuer first files a notice specifying the terms of the offer to sell,

9-2 together with a nonrefundable fee of $150, and the administrator does not

9-3 by order disallow the exemption within the next 5 full business days.

9-4 15. A transaction involving an offer to sell, but not a sale, of a security

9-5 not exempt from registration under the Securities Act of 1933 if:

9-6 (a) A registration or offering statement or similar document as required

9-7 under the Securities Act of 1933 has been filed, but is not effective;

9-8 (b) A registration statement, if required, has been filed under this

9-9 chapter, but is not effective; and

9-10 (c) No order denying, suspending or revoking the effectiveness of

9-11 registration, of which the offeror is aware, has been entered by the

9-12 administrator or the Securities and Exchange Commission, and no

9-13 examination or public proceeding that may culminate in that kind of order

9-14 is known by the offeror to be pending.

9-15 16. A transaction involving an offer to sell, but not a sale, of a security

9-16 exempt from registration under the Securities Act of 1933 if:

9-17 (a) A registration statement has been filed under this chapter, but is not

9-18 effective; and

9-19 (b) No order denying, suspending or revoking the effectiveness of

9-20 registration, of which the offeror is aware, has been entered by the

9-21 administrator and no examination or public proceeding that may culminate

9-22 in that kind of order is known by the offeror to be pending.

9-23 17. A transaction involving the distribution of the securities of an

9-24 issuer to the security holders of another person in connection with a merger,

9-25 consolidation, exchange of securities, sale of assets or other reorganization

9-26 to which the issuer, or its parent or subsidiary, and the other person, or its

9-27 parent or subsidiary, are parties, if:

9-28 (a) The securities to be distributed are registered under the Securities

9-29 Act of 1933 before the consummation of the transaction; or

9-30 (b) The securities to be distributed are not required to be registered

9-31 under the Securities Act of 1933, written notice of the transaction and a

9-32 copy of the materials, if any, by which approval of the transaction will be

9-33 solicited, together with a nonrefundable fee of $150, are given to the

9-34 administrator at least 10 days before the consummation of the transaction

9-35 and the administrator does not, by order, disallow the exemption within the

9-36 next 10 days.

9-37 18. A transaction involving the offer to sell or sale of one or more

9-38 promissory notes each of which is directly secured by a first lien on a single

9-39 parcel of real estate, or a transaction involving the offer to sell or sale of

9-40 participation interests in the notes if the notes and participation interests are

9-41 originated by a depository institution and are offered and sold subject to the

9-42 following conditions:

10-1 (a) The minimum aggregate sales price paid by each purchaser may not

10-2 be less than $250,000;

10-3 (b) Each purchaser must pay cash either at the time of the sale or within

10-4 60 days after the sale; and

10-5 (c) Each purchaser may buy for his own account only.

10-6 19. A transaction involving the offer to sell or sale of one or more

10-7 promissory notes directly secured by a first lien on a single parcel of real

10-8 estate or participating interests in the notes, if the notes and interests are

10-9 originated by a mortgagee approved by the Secretary of Housing and Urban

10-10 Development under sections 203 and 211 of the National Housing Act and

10-11 are offered or sold, subject to the conditions specified in subsection 18, to a

10-12 depository institution or insurance company, the Federal Home Loan

10-13 Mortgage Corporation, the Federal National Mortgage Association or the

10-14 Government National Mortgage Association.

10-15 20. A transaction between any of the persons described in subsection

10-16 19 involving a nonassignable contract to buy or sell the securities described

10-17 in subsection 18 if the contract is to be completed within 2 years and if:

10-18 (a) The seller of the securities pursuant to the contract is one of the

10-19 parties described in subsection 18 or 19 who may originate securities;

10-20 (b) The purchaser of securities pursuant to a contract is any other person

10-21 described in subsection 19; and

10-22 (c) The conditions described in subsection 18 are fulfilled.

10-23 [21. A transaction involving one or more promissory notes secured by

10-24 a lien on real estate, or participating interests in those notes, by a mortgage

10-25 company licensed pursuant to chapter 645B of NRS to engage in those

10-26 transactions.]

10-27 Sec. 6. NRS 90.620 is hereby amended to read as follows:

10-28 90.620 1. The administrator may make an investigation, within or

10-29 outside of this state, as he finds necessary to determine whether a person

10-30 has violated or is about to violate this chapter or any regulation or order of

10-31 the administrator under this chapter or to aid in enforcement of this chapter.

10-32 2. Except as otherwise provided in subsection 4 of NRS 90.730, the

10-33 administrator may publish information concerning a violation of this

10-34 chapter or a regulation or order of the administrator under this chapter or

10-35 concerning types of securities or acts or practices in the offer, sale or

10-36 purchase of types of securities which may operate as a fraud or deceit.

10-37 3. For the purposes of an investigation or proceeding under this chapter

10-38 , the administrator or any officer or employee designated by the

10-39 administrator by regulation , [or] order or written direction may conduct

10-40 hearings, administer oaths and affirmations, render findings of fact and

10-41 conclusions of law, subpoena witnesses, compel their attendance, take

10-42 evidence and require the production, by subpoena or otherwise, of books,

10-43 papers, correspondence, memoranda, agreements or other documents or

11-1 records which the administrator determines to be relevant or material to the

11-2 investigation or proceeding. A person whom the administrator does not

11-3 consider to be the subject of an investigation is entitled to reimbursement at

11-4 the rate of 25 cents per page for copies of documents which he is required

11-5 by subpoena to produce. The administrator may require or permit a person

11-6 to file a statement, under oath or otherwise as the administrator determines,

11-7 as to the facts and circumstances concerning the matter to be investigated.

11-8 4. If the activities constituting an alleged violation for which the

11-9 information is sought would be a violation of this chapter had the activities

11-10 occurred in this state, the administrator may issue and apply to enforce

11-11 subpoenas in this state at the request of a securities agency or administrator

11-12 of another state.

11-13 5. If a person does not testify or produce the documents required by the

11-14 administrator or a designated officer or employee pursuant to subpoena, the

11-15 administrator or designated officer or employee may apply to the court for

11-16 an order compelling compliance. A request for an order of compliance may

11-17 be addressed to:

11-18 (a) The district court in and for the county where service may be

11-19 obtained on the person refusing to testify or produce, if the person is

11-20 subject to service of process in this state; or

11-21 (b) A court of another state having jurisdiction over the person refusing

11-22 to testify or produce, if the person is not subject to service of process in this

11-23 state.

11-24 6. Not later than the time the administrator requests an order for

11-25 compliance, the administrator shall either send notice of the request by

11-26 registered or certified mail, return receipt requested, to the respondent at

11-27 the last known address or take other steps reasonably calculated to give the

11-28 respondent actual notice.

11-29 Sec. 7. NRS 90.830 is hereby amended to read as follows:

11-30 90.830 1. NRS 90.310, 90.330, 90.460, 90.570, 90.580, 90.610 and

11-31 90.660 apply to a person who sells or offers to sell a security or investment

11-32 advisory service if:

11-33 (a) An offer to sell is made in this state; or

11-34 (b) An offer to purchase is made and accepted in this state.

11-35 2. NRS 90.310, 90.330, 90.570, 90.580 and 90.610 apply to a person

11-36 who purchases or offers to purchase a security [or investment advisory

11-37 service] if:

11-38 (a) An offer to purchase is made in this state; or

11-39 (b) An offer to sell is made and accepted in this state.

11-40 3. For the purpose of this section, an offer to sell or to purchase is

11-41 made in this state, whether or not either party is present in this state, if the

11-42 offer:

11-43 (a) Originates in this state; or

12-1 (b) Is directed by the offeror to a destination in this state and received

12-2 where it is directed, or at a post office in this state if the offer is mailed.

12-3 4. For the purpose of this section, an offer to purchase or to sell is

12-4 accepted in this state if acceptance:

12-5 (a) Is communicated to the offeror in this state; and

12-6 (b) Has not previously been communicated to the offeror, orally or in

12-7 writing, outside this state.

12-8 Acceptance is communicated to the offeror in this state, whether or not

12-9 either party is present in this state, if the offeree directs it to the offeror in

12-10 this state reasonably believing the offeror to be in this state and it is

12-11 received where it is directed, or at any post office in this state if the

12-12 acceptance is mailed.

12-13 5. For the purpose of subsections 1 to 4, inclusive, an offer to sell or to

12-14 purchase made in a newspaper or other publication of general, regular and

12-15 paid circulation is not made in this state if the publication:

12-16 (a) Is not published in this state; or

12-17 (b) Is published in this state but has had more than two-thirds of its

12-18 circulation outside this state during the past 12 months.

12-19 6. For the purpose of subsection 5, if a publication is published in

12-20 editions, each edition is a separate publication except for material common

12-21 to all editions.

12-22 7. For the purpose of subsections 1 to 4, inclusive, an offer to sell or to

12-23 purchase made in a radio or television program or other electronic

12-24 communication received in this state which originates outside this state is

12-25 not made in this state.

12-26 8. For the purpose of subsection 7, a radio or television program or

12-27 other electronic communication is considered as having originated in this

12-28 state if either the broadcast studio or originating source of transmission is

12-29 located within the state, unless:

12-30 (a) The program or communication is syndicated and distributed from

12-31 outside this state for redistribution to the general public in this state;

12-32 (b) The program is supplied by a radio, television or other electronic

12-33 network with the electronic signal originating from outside this state for

12-34 redistribution to the general public in this state;

12-35 (c) The program or communication is an electronic signal that originates

12-36 outside this state and is captured for redistribution to the general public in

12-37 this state by a community antenna or cable, radio, cable television, or other

12-38 electronic system; or

12-39 (d) The program or communication consists of an electronic signal

12-40 which originates within this state, but which is not intended for

12-41 redistribution to the general public in this state.

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