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30th Legislature(2017-2018)

Bill Text 30th Legislature


00                SENATE CS FOR CS FOR HOUSE BILL NO. 170(L&C)                                                             
01 "An Act relating to securities, registration, exempt securities, exempt transactions,                                   
02 broker-dealers, agents, investment advice, investment advisers, investment adviser                                      
03 representatives, federal covered securities, federal covered investment advisers, viatical                              
04 settlement interests, small intrastate security offerings, Canadian broker-dealers, and                                 
05 Canadian agents; relating to protecting older and vulnerable adults from financial                                      
06 exploitation; relating to administrative, civil, and criminal enforcement provisions,                                   
07 including restitution and civil penalties for violations; relating to an investor training                              
08 fund; establishing increased civil penalties for harming older persons and vulnerable                                   
09 adults; relating to corporations organized under the Alaska Native Claims Settlement                                    
10 Act; amending Rules 4, 5, 54, 65, and 90, Alaska Rules of Civil Procedure, and Rule 602,                                
11 Alaska Rules of Appellate Procedure; and providing for an effective date."                                              
12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
01    * Section 1. AS 06.05.340 is amended to read:                                                                      
02 Sec. 06.05.340. Certain remuneration prohibited. A bank may not pay                                                   
03 directly or indirectly a fee, commission, or bonus of any kind for its promotion and                                    
04 organization or for securing a subscription to the original capital or to any increase in                               
05 capital. However, this section does not prohibit the payment of reasonable                                              
06 compensation for legal, accounting, and econometric services, or payments to a                                          
07 securities broker-dealer registered under AS 45.56 [AS 45.55] for services that have                                
08       been performed in connection with the sale of bank securities.                                                    
09    * Sec. 2. AS 06.26.020(a) is amended to read:                                                                      
10 (a)  Notwithstanding any other provision of this chapter, a person does not act                                         
11       as a fiduciary under this chapter if the person                                                                   
12 (1)  is licensed to practice law in this state, the person is acting within                                             
13 the scope of the license, and the person and any law firm of the person are not trustees                                
14 of more trusts than the number established for the person and law firm by the                                           
15 department by regulation or order; in this paragraph, "law firm" means a partnership, a                                 
16 professional corporation organized under AS 10.45, or another association organized                                     
17       for the practice of law and in which the person practices law;                                                    
18 (2)  acts as trustee under a deed of trust delivered only as security for                                               
19       the payment of money or for the performance of another act;                                                       
20 (3)  receives and distributes on behalf of a principal rents and proceeds                                               
21       of sales as a real estate broker or other licensee under AS 08.88;                                                
22 (4)  engages in securities business activity [OR INVESTMENT                                                             
23 ADVISORY BUSINESS ACTIVITY] as a registered broker-dealer, a broker-dealer                                              
24 agent, an [A STATE] investment adviser, or an investment adviser representative, or                                 
25 as a federal covered investment adviser who has made a notice filing under                                          
26 AS 45.56.445(c) [AS 45.55.040(h)], the person is acting within the scope of the                                     
27 person's registration or notice filing, and the activity is regulated by the department                                 
28 under AS 45.56 [AS 45.55] or by the United States Securities and Exchange                                           
29 Commission; in this paragraph, "agent," "broker-dealer," "federal covered investment                                
30 adviser," "investment adviser," "investment adviser representative," and                                        
31 ["INVESTMENT ADVISORY BUSINESS,"] "securities business [,]" [AND "STATE                                                 
01 INVESTMENT ADVISER"] have the meanings given in AS 45.56.900                                                        
02       [AS 45.55.990];                                                                                                   
03 (5)  engages in the sale and administration of an insurance product as                                                  
04 an insurance company licensed under AS 21 or an insurance producer licensed under                                       
05       AS 21 and is acting within the scope of that license;                                                             
06 (6)  handles escrow transactions and is a title insurance company that                                                  
07 has a certificate of authority issued under AS 21.09, a title insurance limited producer                                
08 that is licensed as required by AS 21.66.270, or an employee of the title insurance                                     
09 company or title insurance producer when acting in the scope of the employee's                                          
10       employment; in this paragraph,                                                                                    
11 (A)  "escrow transaction" has the meaning given in                                                                      
12            AS 34.80.090;                                                                                                
13 (B)  "title insurance company" has the meaning given in                                                                 
14            AS 21.66.480;                                                                                                
15 (C)  "title insurance limited producer" has the meaning given in                                                        
16            AS 21.66.480;                                                                                                
17                 (7)  is a cemetery association organized and acting under AS 10.30;                                     
18 (8)  is a trustee for a voting trust under AS 10.06 and is acting in that                                               
19       capacity;                                                                                                         
20 (9)  has a certified public accountant license issued under AS 08.04.105                                                
21 or 08.04.195, the person is acting within the scope of the license, and the person and                                  
22 any accounting firm of the person are not trustees of more trusts than the number                                       
23 established for the person and accounting firm by the department by regulation or                                       
24 order; in this paragraph, "accounting firm" means a partnership, a professional                                         
25 corporation organized under AS 10.45, or another association organized for the                                          
26       practice of public accounting and in which the person practices public accounting;                                
27 (10)  holds real property in trust for the primary purpose of subdivision,                                              
28 development, or sale or to facilitate a business transaction with respect to the real                                   
29       property;                                                                                                         
30 (11)  serves as a trustee of a trust created by the person's family                                                     
31       members;                                                                                                          
01 (12)  holds money or other assets as a homeowners' association or                                                       
02 similar organization to pay maintenance and other related costs for commonly owned                                      
03 property; in this paragraph, "homeowners' association" includes an association of                                       
04 apartment owners under AS 34.07.450 and a unit owners' association or master                                            
05       association under AS 34.08.990;                                                                                   
06 (13)  holds money or other assets in connection with the collection of                                                  
07 debts or payments on loans by a person acting solely as the agent or representative at                                  
08 the sole direction of the person to whom the debt or payment is owed, including                                         
09       engaging in the business of an escrow agent;                                                                      
10 (14)  acts as a conservator if the person is appointed by a court of this                                               
11       or another state or is qualified to act as a conservator under AS 13.26.580;                                      
12 (15)  acts as a personal representative if the person is appointed a                                                    
13 personal representative by a court of this or another state or is qualified to act as a                                 
14       personal representative under AS 13.21.035;                                                                       
15 (16)  acts as a guardian or receiver if the person is appointed as a                                                    
16       guardian or receiver by a court of this or another state;                                                         
17 (17)  is a business partner acting with regard to the business, or a co-                                                
18       owner of property acting with regard to the co-owned property;                                                    
19 (18)  serves as a trustee of one or more trusts in which the settlor is not                                             
20 a family member of the person, except that the person may not at any one time serve                                     
21 as a trustee for trusts that cumulatively have more than 10 different settlors; however,                                
22 the department may change by regulation or order the maximum number of settlors                                         
23 allowed for this exemption; in this paragraph, a husband and wife who create a joint                                    
24       trust are considered to be one settlor.                                                                           
25    * Sec. 3. AS 06.26.990(a)(21) is amended to read:                                                                  
26                 (21)  "issuer" has the meaning given in AS 45.56.900 [AS 45.55.990];                                
27    * Sec. 4. AS 12.62.400(a)(18) is amended to read:                                                                  
28 (18)  registration as a broker-dealer, agent, investment adviser                                                        
29 representative, or [STATE] investment adviser under AS 45.56.405 - 45.56.440                                        
30       [AS 45.55.030 - 45.55.060].                                                                                       
31    * Sec. 5. AS 14.43.148(h)(1) is amended to read:                                                                   
01                 (1)  "license"                                                                                          
02 (A)  means, except as provided in (B) of this paragraph, a                                                              
03 license, certificate, permit, registration, or other authorization that, at the time                                    
04 of issuance, will be valid for more than 150 days and that may be acquired                                              
05            from a state agency to perform an occupation, including the following:                                       
06                           (i)  license relating to boxing or wrestling under                                            
07                 AS 05.10;                                                                                               
08                           (ii)  authorization to perform an occupation regulated                                        
09                 under AS 08;                                                                                            
10                           (iii)  teacher certificate under AS 14.20;                                                    
11 (iv)  authorization under AS 18.08 to perform                                                                           
12                 emergency medical services;                                                                             
13                           (v)  asbestos worker certification under AS 18.31;                                            
14                           (vi)  boiler operator's license under AS 18.60.395;                                           
15                           (vii)  certificate of fitness under AS 18.62;                                                 
16                           (viii)  hazardous painting certification under AS 18.63;                                      
17 (ix)  certification as a municipal correctional,                                                                        
18                 correctional, probation, or parole officer under AS 18.65.245;                                          
19 (x)  security guard license under AS 18.65.400 -                                                                        
20                 18.65.490;                                                                                              
21                           (xi)  license relating to insurance under AS 21.27;                                           
22 (xii)  employment agency permit under AS 23.15.330 -                                                                    
23                 23.15.520;                                                                                              
24 (xiii)  registration as a broker-dealer, an agent, an [A                                                            
25 STATE] investment adviser, or an investment adviser representative                                                      
26                 under AS 45.56.405 - 45.56.440 [AS 45.55.030];                                                      
27 (xiv)  certification as a pesticide applicator under                                                                    
28                 AS 46.03.320;                                                                                           
29 (xv)  certification as a storage tank worker or contractor                                                              
30                 under AS 46.03.375;                                                                                     
31 (xvi)  certification as a water and wastewater works                                                                    
01                 operator under AS 46.30; and                                                                            
02                      (B)  does not include                                                                              
03                           (i)  a commercial fishing license under AS 16.05.480,                                         
04                 including a crewmember fishing license;                                                                 
05                           (ii)  a vessel license issued under AS 16.05.490 or                                           
06                 16.05.530;                                                                                              
07                           (iii)  [REPEALED                                                                              
08                           (iv)]  a business license issued under AS 43.70;                                              
09                           (iv) [(v)]  an entry permit or interim-use permit issued                                  
10                 under AS 16.43; or                                                                                      
11                           (v) [(vi)]  a driver's license issued under AS 28.15;                                     
12    * Sec. 6. AS 21.96.110(a) is amended to read:                                                                      
13 (a)  The director shall regulate the transaction of viatical settlement contracts                                       
14 for the protection of viators, insureds, and insurers. The authority of the director under                              
15 this subsection extends to the regulation of transactions between a viator and a viatical                               
16 settlement provider and between a viator and a person acting as an agent in viaticating                                 
17 a life insurance policy, while the authority of the commissioner extends to the                                         
18 regulation of viatical settlement investments as provided under AS 45.56                                            
19       [AS 45.55.905(c)].                                                                                                
20    * Sec. 7. AS 25.27.244(s)(2) is amended to read:                                                                   
21                 (2)  "license"                                                                                          
22 (A)  means, except as provided in (B) of this paragraph, a                                                              
23 license, certificate, permit, registration, or other authorization that, at the time                                    
24 of issuance, will be valid for more than 150 days and that may be acquired                                              
25            from a state agency to perform an occupation, including the following:                                       
26 (i)  license relating to boxing or wrestling under                                                                      
27                 AS 05.10;                                                                                               
28 (ii)  authorization to perform an occupation regulated                                                                  
29                 under AS 08;                                                                                            
30                           (iii)  teacher certificate under AS 14.20;                                                    
31 (iv)  authorization under AS 18.08 to perform                                                                           
01                 emergency medical services;                                                                             
02                           (v)  asbestos worker certification under AS 18.31;                                            
03                           (vi)  boiler operator's license under AS 18.60.395;                                           
04                           (vii)  certificate of fitness under AS 18.62;                                                 
05                           (viii)  hazardous painting certification under AS 18.63;                                      
06                           (ix)  security guard license under AS 18.65.400 -                                             
07                 18.65.490;                                                                                              
08                           (x)  license relating to insurance under AS 21.27;                                            
09                           (xi)  employment agency permit under AS 23.15.330 -                                           
10                 23.15.520;                                                                                              
11 (xii)  registration as a broker-dealer, an agent, an [A                                                             
12 STATE] investment adviser, or an investment adviser representative                                                      
13                 under AS 45.56.405 - 45.56.440 [AS 45.55.030];                                                      
14 (xiii)  certification as a pesticide applicator under                                                                   
15                 AS 46.03.320;                                                                                           
16 (xiv)  certification as a storage tank worker or contractor                                                             
17                 under AS 46.03.375;                                                                                     
18 (xv)  certification as a water and wastewater works                                                                     
19                 operator under AS 46.30;                                                                                
20 (xvi)  commercial crewmember fishing license under                                                                      
21 AS 16.05.480 other than an entry permit or interim-use permit under                                                     
22                 AS 16.43;                                                                                               
23                           (xvii)  fish transporter permit under AS 16.05.671;                                           
24 (xviii)  salt water sport fishing operator license under                                                                
25                 AS 16.40.261;                                                                                           
26 (xix)  salt water sport fishing guide license under                                                                     
27                 AS 16.40.271;                                                                                           
28                      (B)  does not include                                                                              
29 (i)  a vessel license issued under AS 16.05.490 or                                                                      
30                 16.05.530;                                                                                              
31                           (ii)  a business license issued under AS 43.70;                                               
01                           (iii)  an entry permit or interim-use permit issued under                                     
02                 AS 16.43; or                                                                                            
03                           (iv)  a driver's license issued under AS 28.15;                                               
04    * Sec. 8. AS 34.08.570 is amended to read:                                                                         
05 Sec. 34.08.570. Common interest community securities. If an interest in a                                             
06 common interest community is currently registered with the Securities and Exchange                                      
07 Commission of the United States, a declarant satisfies each requirement relating to the                                 
08 preparation of a public offering statement of this chapter if the declarant delivers to the                             
09 purchaser a copy of the public offering statement filed with the Securities and                                         
10 Exchange Commission. An interest in a common interest community is not subject to                                       
11       the registration requirements of AS 45.56 [AS 45.55].                                                         
12    * Sec. 9. AS 37.23.010(c) is amended to read:                                                                      
13 (c)  The registration requirements of AS 45.56 [AS 45.55] do not apply to an                                        
14 investment pool formed under this chapter or to participating public entities with                                      
15       respect to activities of the pool.                                                                                
16    * Sec. 10. AS 37.23.050 is amended to read:                                                                        
17 Sec. 37.23.050. Investment management. The public entities participating in                                           
18 an investment pool under this chapter shall provide for management of investments in                                    
19       the pool by contracting for investment management and related services with                                       
20 (1)  a securities broker-dealer registered under AS 45.56.405                                                       
21       [AS 45.55.030] and under 15 U.S.C. 78o (Securities Exchange Act of 1934);                                         
22 (2)  an [A STATE] investment adviser registered under AS 45.56.435                                              
23 [AS 45.55.030] or a federal covered investment adviser that has made a notice filing                                
24       under AS 45.56.445(c) [AS 45.55.040(h)];                                                                      
25                 (3)  the Department of Revenue; or                                                                      
26 (4)  a financial institution that is a state or federally chartered                                                     
27 commercial or mutual bank, savings and loan association, or credit union if the                                         
28 institution's accounts are insured through the appropriate federal insuring agency of                                   
29       the United States and if the institution has trust powers under state or federal law.                             
30    * Sec. 11. AS 40.25.120(a) is amended to read:                                                                     
31 (a)  Every person has a right to inspect a public record in the state, including                                        
01       public records in recorders' offices, except                                                                      
02                 (1)  records of vital statistics and adoption proceedings, which shall be                               
03       treated in the manner required by AS 18.50;                                                                       
04                 (2)  records pertaining to juveniles unless disclosure is authorized by                                 
05       law;                                                                                                              
06                 (3)  medical and related public health records;                                                         
07                 (4)  records required to be kept confidential by a federal law or                                       
08       regulation or by state law;                                                                                       
09                 (5)  to the extent the records are required to be kept confidential under                               
10 20 U.S.C. 1232g and the regulations adopted under 20 U.S.C. 1232g in order to secure                                    
11       or retain federal assistance;                                                                                     
12 (6)  records or information compiled for law enforcement purposes, but                                                  
13       only to the extent that the production of the law enforcement records or information                              
14 (A)  could reasonably be expected to interfere with enforcement                                                         
15            proceedings;                                                                                                 
16 (B)  would deprive a person of a right to a fair trial or an                                                            
17            impartial adjudication;                                                                                      
18 (C)  could reasonably be expected to constitute an unwarranted                                                          
19            invasion of the personal privacy of a suspect, defendant, victim, or witness;                                
20 (D)  could reasonably be expected to disclose the identity of a                                                         
21            confidential source;                                                                                         
22 (E)  would disclose confidential techniques and procedures for                                                          
23            law enforcement investigations or prosecutions;                                                              
24 (F)  would disclose guidelines for law enforcement                                                                      
25 investigations or prosecutions if the disclosure could reasonably be expected to                                        
26            risk circumvention of the law; or                                                                            
27 (G)  could reasonably be expected to endanger the life or                                                               
28            physical safety of an individual;                                                                            
29 (7)  names, addresses, and other information identifying a person as a                                                  
30 participant in the Alaska Higher Education Savings Trust under AS 14.40.802 or the                                      
31       advance college tuition savings program under AS 14.40.803 - 14.40.817;                                           
01 (8)  public records containing information that would disclose or might                                                 
02 lead to the disclosure of a component in the process used to execute or adopt an                                        
03 electronic signature if the disclosure would or might cause the electronic signature to                                 
04       cease being under the sole control of the person using it;                                                        
05 (9)  reports submitted under AS 05.25.030 concerning certain                                                            
06       collisions, accidents, or other casualties involving boats;                                                       
07 (10)  records or information pertaining to a plan, program, or                                                          
08 procedures for establishing, maintaining, or restoring security in the state, or to a                                   
09 detailed description or evaluation of systems, facilities, or infrastructure in the state,                              
10       but only to the extent that the production of the records or information                                          
11 (A)  could reasonably be expected to interfere with the                                                                 
12            implementation or enforcement of the security plan, program, or procedures;                                  
13 (B)  would disclose confidential guidelines for investigations or                                                       
14 enforcement and the disclosure could reasonably be expected to risk                                                     
15            circumvention of the law; or                                                                                 
16 (C)  could reasonably be expected to endanger the life or                                                               
17 physical safety of an individual or to present a real and substantial risk to the                                       
18            public health and welfare;                                                                                   
19 (11)  the written notification regarding a proposed regulation provided                                                 
20 under AS 24.20.105 to the Department of Law and the affected state agency and                                           
21 communications between the Legislative Affairs Agency, the Department of Law, and                                       
22       the affected state agency under AS 24.20.105;                                                                     
23                 (12)  records that are                                                                                  
24 (A)  proprietary, privileged, or a trade secret in accordance with                                                      
25            AS 43.90.150 or 43.90.220(e);                                                                                
26 (B)  applications that are received under AS 43.90 until notice is                                                      
27            published under AS 43.90.160;                                                                                
28 (13)  information of the Alaska Gasline Development Corporation                                                         
29 created under AS 31.25.010 or a subsidiary of the Alaska Gasline Development                                            
30       Corporation that is confidential by law or under a valid confidentiality agreement;                               
31 (14)  information under AS 38.05.020(b)(11) that is subject to a                                                        
01       confidentiality agreement under AS 38.05.020(b)(12);                                                              
02                 (15)  records relating to proceedings under AS 09.58 (Alaska Medical                                    
03       Assistance False Claim and Reporting Act);                                                                        
04                 (16)  names, addresses, and other information identifying a person as a                                 
05       participant in the Alaska savings program for eligible individuals under AS 06.65;                              
06                 (17)  artists' submissions made in response to an inquiry or solicitation                               
07       initiated by the Alaska State Council on the Arts under AS 44.27.060;                                         
08                 (18)  records that are                                                                              
09                      (A)  investigative files under AS 45.55.910; or                                                
10                      (B)  confidential under AS 45.56.615.                                                          
11    * Sec. 12. AS 43.70.105(a) is amended to read:                                                                     
12            (a)  This chapter does not apply to                                                                          
13                 (1)  a fisheries business;                                                                              
14                 (2)  the sale of liquor under a license issued under AS 04.11;                                          
15                 (3)  an insurance business;                                                                             
16                 (4)  a mining business;                                                                                 
17                 (5)  supplying services as an employee;                                                                 
18                 (6)  furnishing goods or services by a person who does not represent to                                 
19       be regularly engaged in furnishing goods or services;                                                             
20                 (7)  the activities of an investment club; in this paragraph,                                           
21 (A)  "investment club" means a group of individuals,                                                                    
22 incorporated or otherwise organized, that engages primarily in investing in                                             
23 securities, that does not sell investment services to another person, that does                                         
24            not advertise, and the primary purpose of which is educational;                                              
25                      (B)  "security" has the meaning given in AS 45.56.900                                          
26            [AS 45.55.990].                                                                                              
27    * Sec. 13. AS 44.64.030(a)(39) is repealed and reenacted to read:                                                  
28                 (39)  AS 45.56 (Alaska Securities Act);                                                                 
29    * Sec. 14. AS 44.64.030(a) is amended by adding a new paragraph to read:                                         
30                 (51)  AS 45.55 (Alaska Native Claims Settlement Act Corporations                                        
31       Proxy Solicitations and Initial Issuance of Stock).                                                               
01    * Sec. 15. AS 45.55.138 is amended to read:                                                                        
02 Sec. 45.55.138. Application to Alaska Native Claims Settlement Act                                                    
03 corporations. The initial issue of stock of a corporation organized under Alaska law                                  
04 under [PURSUANT TO] 43 U.S.C. 1601 et seq. (Alaska Native Claims Settlement                                         
05 Act) is not a sale of a security under AS 45.56.105 [AS 45.55.070] and 45.56.900(29)                            
06       [45.55.990(28)].                                                                                                
07    * Sec. 16. AS 45.55.139 is amended to read:                                                                        
08            Sec. 45.55.139. Reports of corporations. A copy of all annual reports,                                     
09       proxies, consents or authorizations, proxy statements, and other materials relating to                            
10 proxy solicitations distributed, published, or made available by any person to at least                                 
11 30 Alaska resident shareholders of a corporation organized under Alaska law under                                   
12 43 U.S.C. 1601 et seq. (Alaska Native Claims Settlement Act) that has total assets                                  
13 exceeding $1,000,000 and a class of equity security held of record by 500 or more                                       
14 persons [AND THAT IS EXEMPTED FROM THE REGISTRATION                                                                     
15 REQUIREMENTS OF AS 45.55.070 BY AS 45.55.138,] shall be filed with the                                                  
16       administrator concurrently with its distribution to shareholders.                                                 
17    * Sec. 17. AS 45.55.920(a) is amended to read:                                                                     
18 (a)  If it appears to the administrator that a person has engaged or is about to                                        
19 engage in an act or practice in violation of a provision of this chapter or regulation or                               
20       order under this chapter, the administrator may                                                                   
21 (1)  in the public interest [OR FOR THE PROTECTION OF                                                                   
22       INVESTORS,] issue an order                                                                                        
23 (A)  directing the person to cease and desist from continuing the                                                       
24            act or practice;                                                                                             
25 (B)  directing the person, for a period not to exceed three years,                                                      
26 to file the annual reports, proxies, consents or authorizations, proxy statements,                                      
27 or other materials relating to proxy solicitations required under AS 45.55.139                                          
28 with the administrator for examination and review 10 working days before a                                              
29            distribution to shareholders; and                                                                            
30 (C)  voiding the proxies obtained by a person required to file                                                          
31 under AS 45.55.139, including their future exercise or actions resulting from                                           
01            their past exercise, if the proxies were solicited by means of an untrue or                                  
02            misleading statement prohibited under AS 45.55.160; or                                                       
03 (2)  bring an action in the superior court to enjoin the acts or practices                                              
04 and to enforce compliance with this chapter or regulation or order under this chapter,                                  
05 and upon a proper showing, the appropriate remedy must be granted and a receiver or                                     
06 conservator may be appointed for the defendant or the defendant's assets; the court                                     
07       may not require the administrator to post a bond.                                                                 
08    * Sec. 18. AS 45.55.920(b) is amended to read:                                                                     
09            (b)  The administrator may issue an order against a person [AN APPLICANT,                                
10 REGISTERED PERSON, OR OTHER PERSON] who knowingly [OR                                                                   
11 INTENTIONALLY] violates this chapter or a regulation or order of the administrator                                      
12 under this chapter, imposing a civil penalty of not more than $2,500 for a single                                       
13 violation, or not more than $25,000 for multiple violations, in a single proceeding or a                                
14       series of related proceedings.                                                                                    
15    * Sec. 19. AS 45.55.920(c) is amended to read:                                                                     
16 (c)  For violations not covered by (b) of this section, the administrator may                                           
17 issue an order against a person [AN APPLICANT, REGISTERED PERSON, OR                                                
18 OTHER PERSON] who violates this chapter or a regulation or order of the                                                 
19 administrator under this chapter, imposing a civil penalty of not more than $500 for a                                  
20 single violation, or not more than $5,000 for multiple violations, in a single                                          
21       proceeding or a series of related proceedings.                                                                    
22    * Sec. 20. AS 45.55.925(a) is amended to read:                                                                     
23 (a)  In addition to the civil penalties assessed under AS 45.55.920, a person                                           
24 who wilfully violates a provision of this chapter except AS 45.55.160                                               
25 [AS 45.55.030(e), 45.55.040(h), 45.55.075, OR 45.55.160], or who wilfully violates a                                    
26 regulation or order under this chapter, or who wilfully violates AS 45.55.160 knowing                                   
27 the statement made to be false or misleading in a material respect or the omission to be                                
28 misleading by any material respect, upon conviction, is punishable by a fine of not                                     
29 more than $5,000, or by imprisonment for not less than one year nor more than five                                      
30 years, or both. Upon conviction of an individual for a felony under this chapter,                                       
31 imprisonment for not less than one year is mandatory. However, an individual may not                                    
01       be imprisoned for the violation of a regulation or order if the individual proves that the                        
02 individual had no knowledge of the regulation or order. An indictment or information                                    
03 may not be returned under this chapter more than five years after the alleged violation.                                
04    * Sec. 21. AS 45.55.935(a) is repealed and reenacted to read:                                                    
05 (a)  The administrator shall adopt regulations, consistent with the provisions of                                       
06 this chapter and with regulations adopted under AS 44.64.060, governing                                                 
07 administrative hearings conducted by the office of administrative hearings                                              
08       (AS 44.64.010) for orders issued under AS 45.55.920.                                                            
09    * Sec. 22. AS 45.55.950(a) is amended to read:                                                                     
10 (a)  The administrator may make, adopt, amend, and rescind the regulations,                                             
11 forms, and orders that are necessary to carry out this chapter [, INCLUDING                                             
12 REGULATIONS AND FORMS GOVERNING REGISTRATION STATEMENTS,                                                                
13 APPLICATIONS, AND REPORTS, AND DEFINING TERMS, WHETHER OR                                                               
14 NOT USED IN THIS CHAPTER INSOFAR AS THE DEFINITIONS ARE NOT                                                             
15 INCONSISTENT WITH THIS CHAPTER. FOR THE PURPOSE OF                                                                      
16 REGULATIONS AND FORMS, THE ADMINISTRATOR MAY CLASSIFY                                                                   
17 SECURITIES, PERSONS, AND MATTERS WITHIN THE JURISDICTION OF                                                             
18 THE ADMINISTRATOR, AND PRESCRIBE DIFFERENT REQUIREMENTS FOR                                                             
19       DIFFERENT CLASSES].                                                                                               
20    * Sec. 23. AS 45.55.950(b) is amended to read:                                                                     
21 (b)  A regulation, form, or order may not be made, adopted, amended, or                                                 
22 rescinded unless the administrator finds that the action is necessary or appropriate in                                 
23 the public interest [OR FOR THE PROTECTION OF INVESTORS AND                                                             
24 CONSISTENT WITH THE PURPOSES FAIRLY INTENDED BY THE POLICY                                                              
25 AND PROVISIONS OF THIS CHAPTER. IN ADOPTING REGULATIONS AND                                                             
26 FORMS THE ADMINISTRATOR MAY COOPERATE WITH THE SECURITIES                                                               
27 ADMINISTRATORS OF THE OTHER STATES AND THE SECURITIES AND                                                               
28 EXCHANGE COMMISSION WITH A VIEW TO EFFECTUATING THE POLICY                                                              
29 OF THIS SECTION TO ACHIEVE MAXIMUM UNIFORMITY IN THE FORM                                                               
30 AND CONTENT OF REGISTRATION STATEMENTS, APPLICATIONS, AND                                                               
31       REPORTS WHEREVER PRACTICABLE].                                                                                    
01    * Sec. 24. AS 45.55.990 is repealed and reenacted to read:                                                       
02            Sec. 45.55.990. Definitions. In this chapter, unless the context otherwise                                 
03       requires,                                                                                                         
04                 (1)  "administrator" means the commissioner of commerce, community,                                     
05       and economic development or a designee of the commissioner;                                                       
06                 (2)  "person" has the meaning given in AS 45.56.900.                                                    
07    * Sec. 25. AS 45 is amended by adding a new chapter to read:                                                       
08                     Chapter 56. Alaska Securities Act.                                                                
09                       Article 1. General Provisions.                                                                  
10 Sec. 45.56.105. Securities registration requirement. A person may not offer                                           
11       or sell a security in this state unless                                                                           
12                 (1)  the security is a federal covered security;                                                        
13                 (2)  the security is registered under this chapter; or                                                  
14 (3)  the security or transaction is exempt from registration under                                                      
15       AS 45.56.205 - 45.56.250.                                                                                         
16               Article 2. Exemptions from Registration of Securities.                                                  
17 Sec. 45.56.205. Exempt securities. The following securities are exempt from                                           
18       the requirements of AS 45.56.105, 45.56.305 - 45.56.360, and 45.56.550:                                           
19 (1)  a security, including a revenue obligation or a separate security as                                               
20 defined in 17 C.F.R. 230.131 adopted under 15 U.S.C. 77a - 77aa (Securities Act of                                      
21 1933), issued, insured, or guaranteed by the United States; by a state; by a political                                  
22 subdivision of a state; by a public authority, agency, or instrumentality of one or more                                
23 states; by a political subdivision of one or more states; or by a person controlled or                                  
24 supervised by and acting as an instrumentality of the United States under authority                                     
25 granted by the United States Congress; or a certificate of deposit for any of the                                       
26       foregoing;                                                                                                        
27 (2)  a security issued, insured, or guaranteed by a foreign government                                                  
28 with which the United States maintains diplomatic relations, or by any of its political                                 
29 subdivisions, if the security is recognized as a valid obligation by the issuer, insurer, or                            
30       guarantor;                                                                                                        
31 (3)  a security issued by and representing, or that will represent an                                                   
01       interest in or a direct obligation of or be guaranteed by,                                                        
02                      (A)  an international banking institution;                                                         
03 (B)  a banking institution organized under the laws of the                                                              
04 United States; a member bank of the Federal Reserve System; or a depository                                             
05 institution a substantial portion of the business of which consists or will consist                                     
06 of receiving deposits or share accounts that are insured to the maximum                                                 
07 amount authorized by statute by the Federal Deposit Insurance Corporation,                                              
08 the National Credit Union Share Insurance Fund, or a successor authorized by                                            
09 federal law or exercising fiduciary powers that are similar to those permitted                                          
10 for national banks under the authority of the United States Comptroller of the                                          
11            Currency under 12 U.S.C. 92a; or                                                                             
12 (C)  any other depository institution, unless, by a regulation or                                                       
13            order, the administrator proceeds under AS 45.56.250;                                                        
14 (4)  a security issued by and representing an interest in, or a debt of, or                                             
15 insured or guaranteed by, an insurance company authorized to do business in this                                        
16       state;                                                                                                            
17 (5)  a security issued or guaranteed by a railroad, other common carrier,                                               
18       public utility, or public utility holding company that is                                                         
19 (A)  regulated with respect to its rates and charges by the United                                                      
20            States or a state;                                                                                           
21 (B)  regulated with respect to the issuance or guarantee of the                                                         
22 security by the United States, a state, Canada, or a Canadian province or                                               
23            territory; or                                                                                                
24 (C)  a public utility holding company registered under 42                                                               
25 U.S.C. 16451 - 16481 (Energy Policy Act of 2005) or a subsidiary of the                                                 
26            registered holding company within the meaning of that Act;                                                   
27 (6)  a federal covered security specified in 15 U.S.C. 77r(b)(1)                                                        
28 (Securities Act of 1933) or adopted by rule under that provision or a security listed or                                
29 approved for listing on another securities market specified by regulation under this                                    
30 chapter; a put or call option contract; a warrant; a subscription right on or with respect                              
31 to the security; an option or similar derivative security on a security or an index of                                  
01 securities or foreign currencies issued by a clearing agency registered under 15 U.S.C.                                 
02 78a - 78pp (Securities Exchange Act of 1934) and listed or designated for trading on a                                  
03 national securities exchange, a facility of a national securities exchange, or a facility of                            
04 a national securities association registered under 15 U.S.C. 78a - 78pp (Securities                                     
05 Exchange Act of 1934) or an offer or sale of the underlying security in connection                                      
06 with the offer, sale, or exercise of an option or other security that was exempt when                                   
07 the option or other security was written or issued; or an option or a derivative security                               
08 designated by the Securities and Exchange Commission under 15 U.S.C. 78i(b)                                             
09       (Securities Exchange Act of 1934);                                                                                
10 (7)  a security issued by a person organized and operated exclusively                                                   
11 for religious, educational, benevolent, fraternal, charitable, social, athletic, or                                     
12 reformatory purposes, or as a chamber of commerce, and not for pecuniary profit, no                                     
13 part of the net earnings of which inures to the benefit of a private stockholder or other                               
14 person, or a security of a company that is excluded from the definition of an                                           
15 investment company under 15 U.S.C. 80a-3(c)(10)(B) (Investment Company Act of                                           
16 1940), except that, with respect to the offer or sale of a note, bond, debenture, or other                              
17 evidence of indebtedness issued by the person, a regulation may be adopted under this                                   
18 chapter limiting the availability of this exemption by classifying securities, persons,                                 
19 and transactions, imposing different requirements for different classes, specifying,                                    
20 with respect to (B) of this paragraph, the scope of the exemption and the grounds for                                   
21       denial or suspension, and requiring an issuer to                                                                  
22 (A)  file a notice specifying the material terms of the proposed                                                        
23 offer or sale and copies of any proposed sales and advertising literature to be                                         
24 used and provide that the exemption becomes effective if the administrator                                              
25 does not disallow the exemption within the period established by the                                                    
26            regulation;                                                                                                  
27 (B)  file a request for exemption authorization for which a                                                             
28            regulation adopted under this chapter may specify the                                                        
29                           (i)  scope of the exemption;                                                                  
30                           (ii)  requirement of an offering statement;                                                   
31                           (iii)  filing of sales and advertising literature;                                            
01                           (iv)  filing of consent to service of process complying                                       
02                 with AS 45.56.630; and                                                                                  
03                           (v)  grounds for denial or suspension of the exemption;                                       
04                 or                                                                                                      
05                      (C)  register under AS 45.56.310;                                                                  
06 (8)  a member's or owner's interest in, or a retention certificate or like                                              
07 security given in lieu of a cash patronage dividend issued by, a cooperative organized                                  
08 and operated as a nonprofit membership cooperative under the cooperative laws of a                                      
09 state, but not a member's or owner's interest, retention certificate, or like security sold                             
10       to persons other than bona fide members of the cooperative;                                                       
11 (9)  an equipment trust certificate with respect to equipment leased or                                                 
12 conditionally sold to a person if any security issued by the person would be exempt                                     
13 under this section or would be a federal covered security under 15 U.S.C. 77r(b)(1)                                     
14       (Securities Act of 1933); and                                                                                     
15 (10)  shares of membership stock in the Alaska Commercial Fishing                                                       
16 and Agriculture Bank issued under AS 44.81.010 and other securities issued by that                                      
17       bank to members or in connection with loans to members.                                                           
18 Sec. 45.56.210. Exempt transactions. The following transactions are exempt                                            
19       from the requirements of AS 45.56.105, 45.56.305 - 45.56.360, and 45.56.550:                                      
20 (1)  an isolated nonissuer transaction, whether effected by or through a                                                
21 broker-dealer, if the seller is not a promoter or controlling person; the administrator                                 
22       may define by regulation or order who is a promoter or a controlling person;                                      
23 (2)  a nonissuer transaction by or through a broker-dealer registered, or                                               
24 exempt from registration under this chapter, and a resale transaction by a sponsor of a                                 
25 unit investment trust registered under 15 U.S.C. 80a-1 - 80a-64 (Investment Company                                     
26 Act of 1940), in a security of a class that has been outstanding in the hands of the                                    
27       public for at least 90 days, if, at the date of the transaction,                                                  
28 (A)  the issuer of the security is engaged in business, the issuer                                                      
29 is not in the organizational stage or in bankruptcy or receivership, and the                                            
30 issuer is not a blank check, blind pool, or shell company that does not have a                                          
31 specific business plan or purpose or has indicated that its primary business plan                                       
01            is to engage in a merger or combination of the business with or an acquisition                               
02            of an unidentified person;                                                                                   
03                      (B)  the security is sold at a price reasonably related to its                                     
04            current market price;                                                                                        
05                      (C)  the security does not constitute the whole or part of an                                      
06            unsold allotment to or a subscription or participation by the broker-dealer as an                            
07            underwriter of the security or a redistribution;                                                             
08                      (D)  a nationally recognized securities manual or its electronic                                   
09            equivalent designated by a regulation adopted or order issued under this                                     
10 chapter or a record filed with the Securities and Exchange Commission that is                                           
11            publicly available contains                                                                                  
12 (i)  a description of the business and operations of the                                                                
13                 issuer;                                                                                                 
14 (ii)  the names of the issuer's executive officers and the                                                              
15                 names of the issuer's directors, if any;                                                                
16 (iii)  an audited balance sheet of the issuer as of a date                                                              
17 within 18 months before the date of the transaction or, in the case of a                                                
18 reorganization or merger when the parties to the reorganization or                                                      
19 merger each had an audited balance sheet, a pro forma balance sheet for                                                 
20                 the combined organization; and                                                                          
21 (iv)  an audited income statement for each of the issuer's                                                              
22 two immediately previous fiscal years or for the period of existence of                                                 
23 the issuer, whichever is shorter, or, in the case of a reorganization or                                                
24 merger when each party to the reorganization or merger had audited                                                      
25                 income statements, a pro forma income statement; and                                                    
26                      (E)  any one of the following requirements is met:                                                 
27 (i)  the issuer of the security has a class of equity                                                                   
28 securities listed on a national securities exchange registered under 15                                                 
29 U.S.C. 78f (Securities Exchange Act of 1934) or designated for trading                                                  
30 on the National Association of Securities Dealers Automated Quotation                                                   
31                 System;                                                                                                 
01 (ii)  the issuer of the security is a unit investment trust                                                             
02 registered under 15 U.S.C. 80a-1 - 80a-64 (Investment Company Act of                                                    
03                 1940);                                                                                                  
04 (iii)  the issuer of the security, including its                                                                        
05 predecessors, has been engaged in continuous business for at least three                                                
06                 years; or                                                                                               
07 (iv)  the issuer of the security has total assets of at least                                                           
08 $2,000,000 based on an audited balance sheet as of a date within 18                                                     
09 months before the date of the transaction or, in the case of a                                                          
10 reorganization or merger when the parties to the reorganization or                                                      
11 merger each had an audited balance sheet, a pro forma balance sheet for                                                 
12                 the combined organization;                                                                              
13 (3)  a nonissuer transaction by or through a broker-dealer registered or                                                
14 exempt from registration under this chapter in a security of a foreign issuer that is a                                 
15 margin security defined in regulations or rules adopted by the Board of Governors of                                    
16       the Federal Reserve System;                                                                                       
17 (4)  a nonissuer transaction by or through a broker-dealer registered or                                                
18 exempt from registration under this chapter in an outstanding security if the guarantor                                 
19 of the security files reports with the Securities and Exchange Commission under the                                     
20 reporting requirements of 15 U.S.C. 78m or 15 U.S.C. 78o (Securities Exchange Act                                       
21       of 1934);                                                                                                         
22 (5)  a nonissuer transaction by or through a broker-dealer registered or                                                
23       exempt from registration under this chapter in a security that                                                    
24 (A)  is rated at the time of the transaction by a nationally                                                            
25 recognized statistical rating organization as identified by regulations of the                                          
26            administrator in one of its four highest rating categories; or                                               
27                      (B)  has a fixed maturity or a fixed interest or dividend, if                                      
28 (i)  a default has not occurred during the current fiscal                                                               
29 year or within the three previous fiscal years or, if the issuer has been in                                            
30 business less than three fiscal years, during the existence of the issuer                                               
31 and any predecessor in the payment of principal, interest, or dividends                                                 
01                 on the security; and                                                                                    
02 (ii)  the issuer is engaged in business, is not in the                                                                  
03 organizational stage or in bankruptcy or receivership, and is not and has                                               
04 not, within the previous 12 months, been a blank check, blind pool, or                                                  
05 shell company that does not have a specific business plan or purpose or                                                 
06 has indicated that its primary business plan is to engage in a merger or                                                
07 combination of the business with, or an acquisition of, an unidentified                                                 
08                 person;                                                                                                 
09 (6)  a nonissuer transaction by or through a broker-dealer registered or                                                
10 exempt from registration under this chapter effecting an unsolicited order or offer to                                  
11       purchase;                                                                                                         
12 (7)  a nonissuer transaction executed by a bona fide pledgee without the                                                
13       purpose of evading this chapter;                                                                                  
14 (8)  a nonissuer transaction by a federal covered investment adviser                                                    
15 with investments under management in excess of $100,000,000 acting in the exercise                                      
16       of discretionary authority in a signed record for the account of others;                                          
17 (9)  a transaction in a security, whether or not the security or                                                        
18 transaction is otherwise exempt, in exchange for one or more bona fide outstanding                                      
19 securities, claims, or property interests, or partly in exchange for one or more bona                                   
20 fide outstanding securities, claims, or property interests and partly for cash if the terms                             
21 and conditions of the issuance and exchange or the delivery and exchange and the                                        
22 fairness of the terms and conditions have been approved by the administrator after a                                    
23       hearing;                                                                                                          
24 (10)  a transaction between the issuer or other person on whose behalf                                                  
25       the offering is made and an underwriter, or among underwriters;                                                   
26 (11)  a transaction in a bond or other evidence of indebtedness secured                                                 
27 by a real or chattel mortgage or deed of trust or by an agreement for the sale of real                                  
28       estate or chattels, if                                                                                            
29 (A)  the entire mortgage, deed of trust, or agreement, together                                                         
30 with all the bonds or other evidence of indebtedness, secured under those                                               
31            documents, is offered and sold as a unit;                                                                    
01                      (B)  a general solicitation or general advertisement of the                                        
02            transaction is not made; and                                                                                 
03                      (C)  a commission or other remuneration is not paid or given,                                      
04            directly or indirectly, to a person not registered under this chapter as a broker-                           
05            dealer or as an agent;                                                                                       
06                 (12)  a transaction by an executor, administrator of an estate, sheriff,                                
07       marshal, receiver, trustee in bankruptcy, guardian, or conservator;                                               
08                 (13)  a sale or offer to sell to                                                                        
09                      (A)  an institutional investor;                                                                    
10                      (B)  a federal covered investment adviser; or                                                      
11 (C)  any other person exempted by a regulation adopted or order                                                         
12            issued under this chapter;                                                                                   
13 (14)  a sale or offer to sell securities by or on behalf of an issuer if the                                            
14       transaction is part of a single issue in which                                                                    
15 (A)  not more than 25 purchasers in this state during any 12                                                            
16 consecutive months, other than a person designated in (13) of this section,                                             
17 regardless of whether the seller or any of the buyers is then present in this                                           
18            state;                                                                                                       
19 (B)  a general solicitation or general advertising is not made in                                                       
20            connection with the sale of or offer to sell the securities;                                                 
21 (C)  a commission or other remuneration is not paid or given,                                                           
22 directly or indirectly, to a person other than a broker-dealer registered under                                         
23 this chapter or an agent registered under this chapter for soliciting a                                                 
24            prospective purchaser in this state;                                                                         
25 (D)  the issuer reasonably believes that all the purchasers in this                                                     
26 state, other than those designated in (13) of this section, are purchasing for                                          
27            investment and not with a view to distribution;                                                              
28 (E)  a legend is placed on the certificate or other document                                                            
29 evidencing ownership of the security, and the legend states that the security is                                        
30 not registered under this chapter and cannot be resold without registration                                             
31            under this chapter or exemption from this chapter; and                                                       
01 (F)  before a sale, each prospective buyer is furnished with                                                            
02 information that is sufficient to make an informed investment decision; the                                             
03 information shall be furnished to the administrator upon request; in this                                               
04 subparagraph, "information that is sufficient to make an informed investment                                            
05 decision" includes a business plan, an income and expense statement, a balance                                          
06 sheet, a statement of risks, and a disclosure of any significant negative factors                                       
07            that may affect the outcome of the investment;                                                               
08 (15)  a transaction under an offer to existing security holders of the                                                  
09 issuer, including persons that, at the date of the transaction, are holders of convertible                              
10 securities, options, or warrants, if a commission or other remuneration, other than a                                   
11 standby commission, is not paid or given, directly or indirectly, for soliciting a                                      
12       security holder in this state;                                                                                    
13 (16)  an offer to sell, but not a sale of, a security not exempt from                                                   
14       registration under 15 U.S.C. 77a - 77aa (Securities Act of 1933) if                                               
15 (A)  a registration, offering statement, or similar record as                                                           
16 required under 15 U.S.C. 77a - 77aa (Securities Act of 1933) has been filed but                                         
17 is not effective, or the offer is made in compliance with 17 C.F.R. 230.165,                                            
18            adopted under 15 U.S.C. 77a - 77aa (Securities Act of 1933); and                                             
19 (B)  a stop order of which the offeror is aware has not been                                                            
20 issued against the offeror by the administrator or the Securities and Exchange                                          
21 Commission, and an audit, inspection, or proceeding that is public and that                                             
22            may culminate in a stop order is not known by the offeror to be pending;                                     
23 (17)  an offer to sell, but not a sale of, a security exempt from                                                       
24       registration under 15 U.S.C. 77a - 77aa (Securities Act of 1933) if                                               
25 (A)  a registration statement has been filed under this chapter                                                         
26            but is not effective;                                                                                        
27 (B)  a solicitation of interest is provided in a record to offerees                                                     
28 in compliance with a regulation adopted by the administrator under this                                                 
29            chapter; and                                                                                                 
30 (C)  a stop order of which the offeror is aware has not been                                                            
31 issued by the administrator under this chapter, and an audit, inspection, or                                            
01            proceeding that may culminate in a stop order is not known by the offeror to be                              
02            pending;                                                                                                     
03 (18)  a transaction involving the distribution of the securities of an                                                  
04 issuer to the security holders of another person in connection with a merger,                                           
05 consolidation, exchange of securities, sale of assets, or other reorganization to which                                 
06 the issuer, or its parent or subsidiary, and the other person, or its parent or subsidiary,                             
07       are parties;                                                                                                      
08                 (19)  a rescission offer, sale, or purchase under AS 45.56.665;                                         
09                 (20)  an offer to sell or sale of a security to a person not a resident of                              
10 this state and not present in this state if the offer or sale does not constitute a violation                           
11 of the laws of this state or foreign jurisdiction in which the offeree or purchaser is                                  
12       present and is not part of an unlawful plan or scheme to evade this chapter;                                      
13 (21)  employees' stock purchase, savings, option, profit-sharing,                                                       
14 pension, or similar benefit plan, including any securities, plan interests, and guarantees                              
15 issued under a compensatory benefit plan or compensation contract, contained in a                                       
16 record, established by the issuer, the issuer's parent, the issuer's majority-owned                                     
17 subsidiary, or the majority-owned subsidiary of the issuer's parent for the participation                               
18       of their employees, including offers to sell or sales of the securities to                                        
19 (A)  directors; general partners; managers and members if the                                                           
20 issuer is a limited liability company; trustees, if the issuer is a business trust;                                     
21            officers; consultants; and advisors;                                                                         
22 (B)  family members who acquire the securities from those                                                               
23            persons through gifts or domestic relations orders;                                                          
24 (C)  former employees, directors, general partners, trustees,                                                           
25 officers, consultants, limited liability managers or members, and advisors if                                           
26 those individuals were employed by or providing services to the issuer when                                             
27            the securities were offered; and                                                                             
28 (D)  insurance agents who are exclusive insurance agents of the                                                         
29 issuer or the issuer's subsidiary or parent or who derive more than 50 percent                                          
30            of their annual income from those organizations;                                                             
31                 (22)  a transaction involving                                                                           
01 (A)  a stock dividend or equivalent equity distribution,                                                                
02 regardless of whether the corporation or other business organization                                                    
03 distributing the dividend or equivalent equity distribution is the issuer, if                                           
04 nothing of value is given by stockholders or other equity holders for the                                               
05 dividend or equivalent equity distribution other than the surrender of a right to                                       
06 a cash or property dividend if each stockholder or other equity holder may                                              
07 elect to take the dividend or equivalent equity distribution in cash, property, or                                      
08            stock;                                                                                                       
09 (B)  a transaction incident to a right of conversion or judicially                                                      
10 approved reorganization in which a security is issued in exchange for one or                                            
11 more outstanding securities, claims, or property interests, or partly in exchange                                       
12 for one or more outstanding securities, claims, or property interests and partly                                        
13            for cash; or                                                                                                 
14 (C)  the solicitation of tenders of securities by an offeror in a                                                       
15 tender offer in compliance with 17 C.F.R. 230.162, adopted under 15 U.S.C.                                              
16            77a - 77aa (Securities Act of 1933);                                                                         
17 (23)  a nonissuer transaction in an outstanding security by or through a                                                
18 broker-dealer registered or exempt from registration under this chapter, if the issuer is                               
19 a reporting issuer in a foreign jurisdiction designated by this paragraph or by a                                       
20 regulation adopted or order issued under this chapter; the issuer has been subject to                                   
21 continuous reporting requirements in the foreign jurisdiction for not less than 180 days                                
22 before the transaction; and the security is listed on the foreign jurisdiction's securities                             
23 exchange that has been designated by this paragraph or by a regulation adopted or                                       
24 order issued under this chapter, or is a security of the same issuer that is of senior or                               
25 substantially equal rank to the listed security or is a warrant or right to purchase or                                 
26 subscribe to any of the foregoing; for purposes of this paragraph, Canada, together                                     
27 with its provinces and territories, is a designated foreign jurisdiction, and TSX, Inc.,                                
28 formerly known as the Toronto Stock Exchange, Inc., is a designated securities                                          
29 exchange; after an administrative hearing in compliance with AS 45.56.650(c), the                                       
30 administrator, by a regulation adopted or order issued under this chapter, may revoke                                   
31 the designation of a securities exchange under this paragraph if the administrator finds                                
01       that revocation is necessary or appropriate in the public interest and for the protection                         
02       of investors;                                                                                                     
03                 (24)  sales by an issuer to the buyer of an enterprise or a business and                                
04       the assets and liabilities of the enterprise or business if                                                       
05                      (A)  the transfer of stock to the buyer is solely incidental to the                                
06            sale of the enterprise or business and its assets and liabilities;                                           
07                      (B)  the seller provides the buyer with full access to the books                                   
08            and records of the enterprise or business; and                                                               
09                      (C)  a legend is placed on the certificate or other document                                       
10 evidencing ownership of the security, stating that the security is not registered                                       
11 under this chapter and cannot be resold without registration under this chapter                                         
12            or exemption from it;                                                                                        
13 (25)  offers or sales of certificates of interest or participation in oil, gas,                                         
14 or mining rights, titles, or leases, or in payments out of production under the rights,                                 
15       titles, or leases, if the purchasers                                                                              
16 (A)  are or have been, during the preceding two years, engaged                                                          
17 primarily in the business of exploring for, mining, producing, or refining oil,                                         
18            gas, or minerals; or                                                                                         
19 (B)  have been found by the administrator upon written                                                                  
20 application to be substantially engaged in the business of exploring for,                                               
21 mining, producing, or refining oil, gas, or minerals so as not to require the                                           
22            protection provided by this chapter;                                                                         
23 (26)  a transaction involving only family members, or involving only                                                    
24 family members and the corporations, partnerships, limited liability companies,                                         
25 limited partnerships, limited liability partnerships, associations, joint-stock companies,                              
26 or trusts that are organized, formed, or created by family members or at the direction                                  
27 of family members; in this paragraph, "family members" means persons who are                                            
28 related, including related by adoption, within the fourth degree of affinity or                                         
29       consanguinity; or                                                                                                 
30 (27)  a transaction relating to a security that is not part of an initial issue                                         
31 of stock covered by AS 45.55.138, but that is issued by a corporation organized under                                   
01 Alaska law under 43 U.S.C. 1601 et seq. (Alaska Native Claims Settlement Act), if the                                   
02       corporation qualifies for exempt status under 43 U.S.C. 1625(a).                                                  
03 Sec. 45.56.220. Small intrastate securities offerings. (a) An offer or sale of                                        
04 securities conducted solely in this state to a person who has established residency in                                  
05 this state, by an issuer in a transaction that meets the requirements of this section, is                               
06 exempt from the requirements of AS 45.56.105, 45.56.305 - 45.56.360, and 45.56.550                                      
07       and is subject to the following limitations:                                                                      
08 (1)  the issuer of the security shall be a for-profit corporation, another                                              
09 for-profit entity, or a business cooperative, have its principal place of business in this                              
10       state, and be licensed by the department;                                                                         
11 (2)  the transaction must meet the requirements of the federal                                                          
12 exemption for intrastate offerings in 15 U.S.C. 77c(a)(11) (Securities Act of 1933) and                                 
13 17 C.F.R. 230.147; the securities must be offered to and sold only to persons who                                       
14 have established residency in this state at the time of purchase; before any offer or sale                              
15 under this exemption, the seller shall obtain documentary evidence from each                                            
16 prospective purchaser that provides the seller with a reasonable basis to believe the                                   
17       investor has established residency in this state;                                                                 
18 (3)  the sum of all cash and other consideration to be received for all                                                 
19 sales of the security in reliance on this exemption may not exceed $1,000,000, less the                                 
20 aggregate amount received for all sales of securities by the issuer within the 12 months                                
21       before the first offer or sale made in reliance on this exemption;                                                
22 (4)  the issuer may not accept more than $10,000 from any single                                                        
23 purchaser unless the purchaser is an accredited investor as defined by 17 C.F.R.                                        
24       230.501;                                                                                                          
25 (5)  the issuer reasonably believes that all purchasers of securities are                                               
26 purchasing for investment and not for sale in connection with a distribution of the                                     
27       security;                                                                                                         
28 (6)  a commission or remuneration may not be paid or given, directly or                                                 
29 indirectly, for any person's participation in the offer or sale of securities for the issuer                            
30 unless the person is registered as a broker-dealer, agent, investment adviser                                           
31       representative, or investment adviser under AS 45.56.405 - 45.56.440;                                             
01 (7)  the issuer of the security shall deposit in an escrow account in a                                                 
02 bank or other depository institution authorized to do business in this state all funds                                  
03 received from investors until the minimum target dollar amount for the security                                         
04 offering is met; the issuer shall file the escrow agreement with the administrator, and                                 
05 the contents of the escrow agreement must include a statement that the proceeds of the                                  
06 sale under this section will not be released from the escrow account until the minimum                                  
07 target dollar amount for the security offering is met; all funds shall be used in                                       
08       accordance with representations made to investors;                                                                
09 (8)  not less than 10 days before the use of any general solicitation or                                                
10 within 15 days after the first sale of the security under this exemption, if general                                    
11 solicitation has not been used before the sale, whichever occurs first, the issuer shall                                
12 provide a notice to the administrator as prescribed in regulations for this section; the                                
13 notice must specify that the issuer is conducting an offering in reliance on this                                       
14       exemption and must contain the names and addresses of                                                             
15                      (A)  the issuer;                                                                                   
16                      (B)  officers, directors, and any controlling person of the issuer;                                
17 (C)  all persons who will be involved in the offer or sale of                                                           
18            securities on behalf of the issuer; and                                                                      
19 (D)  the bank or other depository institution in which investor                                                         
20            funds will be deposited;                                                                                     
21                 (9)  the issuer may not be, either before or as a result of the offering,                               
22 (A)  an investment company as defined by 15 U.S.C. 80a-1 -                                                              
23 80a-64 (Investment Company Act of 1940), or subject to the reporting                                                    
24            requirements of 15 U.S.C. 78m or 78o (Securities Exchange Act of 1934); or                                   
25 (B)  a broker-dealer, agent, investment adviser representative, or                                                      
26            investment adviser subject to AS 45.56.405 - 45.56.440;                                                      
27 (10)  the issuer shall inform all purchasers that the securities have not                                               
28 been registered under AS 45.56.105, 45.56.305 - 45.56.360, and 45.56.550 and may                                        
29 not be resold unless the securities are registered or qualify for an exemption from                                     
30 registration under AS 45.56.205, 45.56.210, or 45.56.240; in addition, the issuer shall                                 
31       make the disclosures required by 17 C.F.R. 230.147(f);                                                            
01 (11)  the issuer shall require all purchasers to sign the following                                                     
02 statement at the time of sale: "I acknowledge that I am investing in a high-risk,                                       
03 speculative business venture, that I may lose all of my investment, and that I can                                      
04       afford the loss of my investment";                                                                                
05 (12)  this exemption may not be used in conjunction with any other                                                      
06 exemption under this chapter, except the exemption to institutional investors under                                     
07 AS 45.56.405 and 45.56.435 and for offers and sales to controlling persons of the                                       
08 issuer; sales to controlling persons may not count toward the limitation in (3) of this                                 
09       subsection;                                                                                                       
10 (13)  this exemption may not be construed to remove any person from                                                     
11 the anti-fraud provisions under AS 45.56.505 - 45.56.560, and the exemption may not                                     
12 be construed to provide relief from any other provision of this chapter other than as                                   
13       expressly stated.                                                                                                 
14 (b)  The administrator may by order deny or revoke the exemption specified in                                           
15 this section with respect to a specific security if the administrator finds that the sale of                            
16 the security would work or tend to work a fraud on the purchasers of the security. An                                   
17 order under this subsection may not operate retroactively. A person may not be                                          
18 considered to have violated an order because of any offer or sale effected after the                                    
19 entry of an order under this subsection if the person sustains the burden of proof that                                 
20 the person did not know and, in the exercise of reasonable care, could not have known                                   
21       of the order.                                                                                                     
22 (c)  A person who makes application to the department for an exemption under                                            
23       this section shall be assessed a filing fee as prescribed in regulations for this section.                        
24            (d)  In this section, "residency" has the meaning given in AS 01.10.055.                                     
25 Sec. 45.56.230. Disqualifier. Exemption from registration under AS 45.56.205                                          
26 - 45.56.250 is not available for a security or transaction if the issuer, or any of its                                 
27 officers, controlling persons, or promoters, is subject to a disqualifier described in the                              
28 regulations adopted under 15 U.S.C. 78c(a)(39) (Dodd-Frank Wall Street Reform and                                       
29       Consumer Protection Act) as of the date of the transaction or offer.                                              
30 Sec. 45.56.240. Waiver and modification. For any security or transaction or                                           
31 any type of security or transaction, the administrator may by order, waive, withdraw,                                   
01       or modify any of the requirements or conditions of AS 45.56.205 - 45.56.250.                                      
02 Sec. 45.56.250. Denial, suspension, revocation, condition, or limitation of                                           
03 exemptions. (a) Except with respect to a federal covered security or a transaction                                    
04 involving a federal covered security, an order under this chapter may deny, suspend                                     
05 application of, condition, limit, or revoke an exemption created under                                                  
06 AS 45.56.205(3)(C), (7), or (8), 45.56.210, or 45.56.220, or an exemption or waiver                                     
07 created under AS 45.56.240 with respect to a specific security, transaction, or offer.                                  
08 An order under this subsection may be issued only under the procedures in                                               
09       AS 45.56.360(d) or 45.56.650 and only prospectively.                                                              
10 (b)  A person does not violate AS 45.56.105, 45.56.305 - 45.56.320, 45.56.340,                                          
11 45.56.360, 45.56.550, or 45.56.665 by an offer to sell, offer to purchase, sale, or                                     
12 purchase effected after the entry of an order issued under this section if the person did                               
13       not know and, in the exercise of reasonable care, could not have known, of the order.                             
14    Article 3. Registration of Securities and Notice Filing of Federal Covered Securities.                             
15 Sec. 45.56.305. Securities registration by coordination. (a) A security for                                           
16 which a registration statement has been filed under 15 U.S.C. 77a - 77aa (Securities                                    
17 Act of 1933) in connection with the same offering may be registered by coordination                                     
18       under this section.                                                                                               
19 (b)  A registration statement and accompanying records under this section must                                          
20 contain or be accompanied by the following records, in addition to the information                                      
21 specified in AS 45.56.320, and a consent to service of process complying with                                           
22       AS 45.56.630:                                                                                                     
23 (1)  a copy of the latest form of prospectus filed under 15 U.S.C. 77a -                                                
24       77aa (Securities Act of 1933);                                                                                    
25 (2)  if the administrator requires, a copy of the articles of incorporation                                             
26 and bylaws or their substantial equivalents currently in effect; a copy of any other                                    
27 information or any other records filed by the issuer under 15 U.S.C. 77a - 77aa                                         
28 (Securities Act of 1933) requested by the administrator; a copy of any agreement with                                   
29 or among underwriters; a copy of any indenture or other instrument governing the                                        
30 issuance of the security to be registered; and a specimen, copy, or description of the                                  
31       security that is required by a regulation adopted or order issued under this chapter; and                         
01                 (3)  an undertaking to forward each amendment to the federal                                            
02       prospectus, other than an amendment that delays the effective date of the registration                            
03       statement, promptly after it is filed with the Securities and Exchange Commission.                                
04            (c)  A registration statement under this section becomes effective                                           
05       simultaneously with or subsequent to the federal registration statement when all the                              
06       following conditions are satisfied:                                                                               
07                 (1)  a stop order under (d) of this section or AS 45.56.360 or issued by                                
08       the Securities and Exchange Commission is not in effect, and a proceeding is not                                  
09       pending against the issuer under AS 45.56.485; and                                                                
10 (2)  the registration statement has been on file for at least 20 days or a                                              
11       shorter period provided by a regulation adopted or order issued under this chapter.                               
12 (d)  The registrant shall promptly notify the administrator in a record of the                                          
13 date when the federal registration statement becomes effective and the content of any                                   
14 price amendment and shall promptly file a record containing the price amendment. If                                     
15 the notice is not timely received, the administrator may issue a stop order, without                                    
16 prior notice or hearing, retroactively denying effectiveness to the registration                                        
17 statement or suspending its effectiveness until compliance with this section. The                                       
18 administrator shall promptly notify the registrant of an order by telephone or                                          
19 electronic means and promptly confirm this notice by a record. If the registrant later                                  
20 complies with the notice requirements of this subsection, the stop order is void as of                                  
21       the date of its issuance.                                                                                         
22 (e)  If the federal registration statement becomes effective before each of the                                         
23 conditions in this section is satisfied or is waived by the administrator, the registration                             
24 statement is automatically effective under this chapter when all the conditions are                                     
25 satisfied or waived. If the registrant notifies the administrator of the date when the                                  
26 federal registration statement is expected to become effective, the administrator shall                                 
27 promptly notify the registrant by telephone or electronic means and promptly confirm                                    
28 this notice by a record, indicating whether all the conditions are satisfied or waived                                  
29 and whether the administrator intends the institution of a proceeding under                                             
30 AS 45.56.360. The notice by the administrator does not preclude the institution of a                                    
31       proceeding under AS 45.56.360.                                                                                    
01 Sec. 45.56.310. Securities registration by qualification. (a) A security may                                          
02       be registered by qualification under this section.                                                                
03 (b)  A registration statement under this section must contain the information or                                        
04 records specified in AS 45.56.320, a consent to service of process complying with                                       
05       AS 45.56.630, and the following information or records:                                                           
06 (1)  with respect to the issuer and any significant subsidiary, the name,                                               
07 address, and form of organization of the issuer and subsidiary; the state or foreign                                    
08 jurisdiction and date of organization of the issuer and subsidiary; the general character                               
09 and location of the business of the issuer and subsidiary; a description of the physical                                
10 properties and equipment of the issuer and subsidiary; and a statement of the general                                   
11 competitive conditions in the industry or business in which the issuer and subsidiary                                   
12       are or will be engaged;                                                                                           
13 (2)  with respect to each director and officer of the issuer and other                                                  
14 person having a similar status or performing similar functions, the person's name,                                      
15 address, and principal occupation for the previous five years; the amount of securities                                 
16 of the issuer held by the person as of the 30th day before the filing of the registration                               
17 statement; the amount of the securities covered by the registration statement to which                                  
18 the person has indicated an intention to subscribe; and a description of any material                                   
19 interest of the person in any material transaction with the issuer or a significant                                     
20       subsidiary effected within the previous three years or proposed to be effected;                                   
21 (3)  with respect to persons covered by (2) of this subsection, the                                                     
22 aggregate sum of the remuneration paid to those persons during the previous 12                                          
23 months and estimated to be paid during the next 12 months, directly or indirectly, by                                   
24       the issuer and all predecessors, parents, subsidiaries, and affiliates of the issuer;                             
25 (4)  with respect to a person owning of record or owning beneficially, if                                               
26 known, 10 percent or more of the outstanding shares of any class of equity security of                                  
27 the issuer, the information specified in (2) of this subsection, other than the person's                                
28       occupation;                                                                                                       
29 (5)  with respect to a promoter, if the issuer was organized within the                                                 
30 previous three years, the information or records specified in (2) of this subsection, any                               
31 amount paid to the promoter within that period or intended to be paid to the promoter,                                  
01       and the consideration for the payment;                                                                            
02 (6)  with respect to a person on whose behalf any part of the offering is                                               
03 to be made in a nonissuer distribution, the person's name and address; the amount of                                    
04 securities of the issuer held by the person as of the date of the filing of the registration                            
05 statement; a description of any material interest of the person in any material                                         
06 transaction with the issuer or any significant subsidiary effected within the previous                                  
07 three years or proposed to be effected; and a statement of the reasons for making the                                   
08       offering;                                                                                                         
09 (7)  the capitalization and long-term debt, on both a current and pro                                                   
10 forma basis, of the issuer and any significant subsidiary, including a description of                                   
11 each security outstanding or being registered or otherwise offered, and a statement of                                  
12 the amount and kind of consideration, whether in the form of cash, physical assets,                                     
13 services, patents, goodwill, or anything else of value, for which the issuer or any                                     
14 subsidiary has issued its securities within the previous two years or is obligated to                                   
15       issue its securities;                                                                                             
16 (8)  the kind and amount of securities to be offered; the proposed                                                      
17 offering price or the method by which the offering price is to be computed; any                                         
18 variation at which a proportion of the offering is to be made to a person or class of                                   
19 persons other than the underwriters, with a specification of the person or class; the                                   
20 basis on which the offering is to be made if otherwise than for cash; the estimated                                     
21 aggregate underwriting and selling discounts or commissions and finders' fees,                                          
22 including separately cash, securities, contracts, or anything else of value to accrue to                                
23 the underwriters or finders in connection with the offering or, if the selling discounts                                
24 or commissions are variable, the basis of determining them and their maximum and                                        
25 minimum amounts; the estimated amounts of other selling expenses, including legal,                                      
26 engineering, and accounting charges; the name and address of each underwriter and                                       
27 each recipient of a finder's fee; a copy of any underwriting or selling group agreement                                 
28 under which the distribution is to be made, or the proposed form of an underwriting or                                  
29 selling group agreement whose terms have not yet been determined; and a description                                     
30 of the plan of distribution of any securities that are to be offered other than through an                              
31       underwriter;                                                                                                      
01 (9)  the estimated monetary proceeds to be received by the issuer from                                                  
02 the offering; the purposes for which the proceeds are to be used by the issuer; the                                     
03 estimated amount to be used for each purpose; the order or priority in which the                                        
04 proceeds will be used for the purposes stated; the amounts of any funds to be raised                                    
05 from other sources to achieve the purposes stated; the sources of the funds; and, if a                                  
06 part of the proceeds is to be used to acquire property, including goodwill, other than in                               
07 the ordinary course of business, the names and addresses of the vendors, the purchase                                   
08 price, the names of any persons that have received commissions in connection with the                                   
09 acquisition, and the amounts of the commissions and other expenses in connection                                        
10       with the acquisition, including the cost of borrowing money to finance the acquisition;                           
11 (10)  a description of any stock options or other security options                                                      
12 outstanding or to be created in connection with the offering, and the amount of those                                   
13 options held or to be held by each person required to be named in (2), (4), (5), (6), or                                
14 (8) of this subsection and by any person that holds or will hold 10 percent or more in                                  
15       the aggregate of those options;                                                                                   
16 (11)  the dates of, parties to, and general effect, concisely stated, of                                                
17 each managerial or other material contract made or to be made other than in the                                         
18 ordinary course of business to be performed in whole or in part at or after the filing of                               
19 the registration statement or that was made within the previous two years, and a copy                                   
20       of each contract;                                                                                                 
21 (12)  a description of any pending litigation, action, or proceeding to                                                 
22 which the issuer is a party and that materially affects the issuer's business or assets and                             
23       any litigation, action, or proceeding known to be contemplated;                                                   
24 (13)  a copy of any prospectus, pamphlet, circular, form letter,                                                        
25 advertisement, or other sales literature intended as of the effective date of the                                       
26 registration statement to be used in connection with the offering and any solicitation of                               
27       interest used in compliance with AS 45.56.210(17)(B);                                                             
28 (14)  a specimen or copy of the security being registered, unless the                                                   
29 security is uncertificated; a copy of the issuer's articles of incorporation and bylaws or                              
30 their substantial equivalents, in effect; and a copy of any indenture or other instrument                               
31       covering the security to be registered;                                                                           
01 (15)  a signed or conformed copy of an opinion of counsel concerning                                                    
02 the legality of the security being registered, with an English translation if the opinion                               
03 is in a language other than English, that states whether the security when sold will be                                 
04 validly issued, fully paid, nonassessable, and, if a debt security, a binding obligation of                             
05       the issuer;                                                                                                       
06 (16)  a signed or conformed copy of a consent of any accountant,                                                        
07 engineer, appraiser, or other person whose profession gives authority for a statement                                   
08 made by the person if the person is named as having prepared or certified a report or                                   
09 valuation, other than an official record, that is public, and that is used in connection                                
10       with the registration statement;                                                                                  
11 (17)  a balance sheet of the issuer as of a date within four months                                                     
12 before the filing of the registration statement; a statement of income and a statement of                               
13 cash flows for each of the three fiscal years preceding the date of the balance sheet and                               
14 for any period between the close of the immediately previous fiscal year and the date                                   
15 of the balance sheet, or for the period of the issuer's and any predecessor's existence if                              
16 less than three years; and, if any part of the proceeds of the offering is to be applied to                             
17 the purchase of a business, the financial statements that would be required if that                                     
18       business were the registrant; and                                                                                 
19 (18)  any additional information or records required by a regulation                                                    
20       adopted or order issued under this chapter.                                                                       
21 (c)  A registration statement under this section becomes effective when the                                             
22       administrator orders that the registration is effective.                                                          
23 (d)  A regulation adopted or order issued under this chapter may require as a                                           
24 condition of registration under this section that a prospectus containing a specified part                              
25 of the information or record specified in (b) of this section be sent or given to each                                  
26       person to which an offer is made before or concurrently with the earliest of                                      
27 (1)  the first offer made in a record to the person other than by means of                                              
28 a public advertisement, by or for the account of the issuer or another person on whose                                  
29 behalf the offering is being made or by an underwriter or broker-dealer that is offering                                
30 part of an unsold allotment or subscription taken by the person as a participant in the                                 
31       distribution;                                                                                                     
01                 (2)  the confirmation of a sale made by or for the account of the person;                               
02                 (3)  payment under the sale; or                                                                         
03                 (4)  delivery of the security under the sale.                                                           
04            Sec. 45.56.320. Securities registration filings. (a) A registration statement                              
05       may be filed by the issuer, a person on whose behalf the offering is to be made, or a                             
06       broker-dealer registered under this chapter.                                                                      
07            (b)  A person filing a registration statement shall pay a filing fee established by                          
08       a regulation adopted under this chapter and consent to service of process as described                            
09       under AS 45.56.630.                                                                                               
10 (c)  A registration statement filed under AS 45.56.305 or 45.56.310 must                                                
11       specify                                                                                                           
12                 (1)  the amount of securities to be offered in this state;                                              
13 (2)  the states in which a registration statement or similar record in                                                  
14       connection with the offering has been or is to be filed; and                                                      
15 (3)  any adverse order, judgment, or decree issued in connection with                                                   
16 the offering by a state securities regulator, the Securities and Exchange Commission,                                   
17       or a court.                                                                                                       
18 (d)  A record filed under this chapter or former AS 45.55 within five years                                             
19 preceding the filing of a registration statement may be incorporated by reference in the                                
20       registration statement to the extent that the record is currently accurate.                                       
21 (e)  In the case of a nonissuer distribution, information or a record may not be                                        
22 required under (i) of this section or AS 45.56.310 unless it is known to the person                                     
23 filing the registration statement or to the person on whose behalf the distribution is to                               
24 be made or unless it can be furnished by those persons without unreasonable effort or                                   
25       expense.                                                                                                          
26 (f)  A regulation adopted or order issued under this chapter may require as a                                           
27 condition of registration that a security issued within the previous five years or to be                                
28 issued to a promoter for a consideration substantially less than the public offering                                    
29 price or to a person for a consideration other than cash be deposited in escrow and that                                
30 the proceeds from the sale of the registered security in this state be impounded until                                  
31 the issuer receives a specified amount from the sale of the security, either in this state                              
01 or elsewhere. The conditions of any escrow or impoundment required under this                                           
02 subsection may be established by a regulation adopted or order issued under this                                        
03 chapter, but the administrator may not reject a depository institution solely because of                                
04       its location in another state.                                                                                    
05 (g)  A regulation adopted or order issued under this chapter may require as a                                           
06 condition of registration that a security registered under this chapter be sold only on a                               
07 specified form of subscription or sale contract and that a signed or conformed copy of                                  
08 each contract be filed under this chapter or preserved for a period specified by the                                    
09       regulation or order, not to exceed five years.                                                                    
10 (h)  Except while a stop order is in effect under AS 45.56.360, a registration                                          
11 statement is effective for one year after the effective date of the registration statement                              
12 or for any longer period designated in an order under this chapter during which the                                     
13 security is being offered or distributed in a nonexempted transaction by or for the                                     
14 account of the issuer or other person on whose behalf the offering is being made or by                                  
15 an underwriter or broker-dealer that is still offering part of an unsold allotment or                                   
16 subscription taken as a participant in the distribution. For the purposes of a nonissuer                                
17 transaction, all outstanding securities of the same class identified in the registration                                
18 statement as a security registered under this chapter are considered to be registered                                   
19 while the registration statement is effective. If any securities of the same class are                                  
20 outstanding, a registration statement may not be withdrawn until one year after the                                     
21 effective date of the registration statement. A registration statement may be withdrawn                                 
22       only with the approval of the administrator.                                                                      
23 (i)  While a registration statement is effective, a regulation adopted or order                                         
24 issued under this chapter may require the person that filed the registration statement to                               
25 file reports, not more often than quarterly, to keep the information or other record in                                 
26 the registration statement reasonably current and to disclose the progress of the                                       
27       offering.                                                                                                         
28 (j)  A registration statement may be amended after the effective date of the                                            
29 registration statement. The post-effective amendment becomes effective when the                                         
30 administrator so orders. If a post-effective amendment is made to increase the number                                   
31 of securities specified to be offered or sold, the person filing the amendment shall pay                                
01 a registration fee established by a regulation adopted under this chapter. A post-                                      
02 effective amendment relates back to the date of the offering of the additional securities                               
03 being registered if, within one year after the date of the sale, the amendment is filed                                 
04       and the additional registration fee is paid.                                                                      
05 Sec. 45.56.330. Notice filing of federal covered securities. (a) With respect to                                      
06 a federal covered security, as defined in 15 U.S.C. 77r(b) (Securities Act of 1933), that                               
07 is not otherwise exempt under AS 45.56.205 - 45.56.250, a regulation adopted or order                                   
08       issued under this chapter may require the filing of any or all of the following records:                          
09                 (1)  before the initial offer of a federal covered security in this state, all                          
10 records that are part of a federal registration statement filed with the Securities and                                 
11 Exchange Commission under 15 U.S.C. 77a - 77aa (Securities Act of 1933), a consent                                      
12 to service of process complying with AS 45.56.630 signed by the issuer, and the                                         
13       payment of a fee established in a regulation adopted under this chapter;                                          
14 (2)  after the initial offer of the federal covered security in this state, all                                         
15 records that are part of an amendment to a federal registration statement filed with the                                
16 Securities and Exchange Commission under 15 U.S.C. 77a - 77aa (Securities Act of                                        
17       1933); and                                                                                                        
18 (3)  to the extent necessary or appropriate to compute fees, a report of                                                
19 the value of the federal covered securities sold or offered to persons present in this                                  
20 state if the sales data are not included in records filed with the Securities and                                       
21 Exchange Commission and payment of a fee established in a regulation adopted under                                      
22       this chapter.                                                                                                     
23 (b)  A notice filing under (a) of this section is effective for one year                                                
24 commencing on the later of the notice filing or the effectiveness of the offering filed                                 
25 with the Securities and Exchange Commission. On or before expiration, the issuer                                        
26 may renew a notice filing by filing with the Securities and Exchange Commission a                                       
27 copy of those records filed by the issuer that are required by a regulation adopted or                                  
28 order issued under this chapter to be filed and by paying a renewal fee established in a                                
29 regulation adopted under this chapter. A previously filed consent to service of process                                 
30 complying with AS 45.56.630 may be incorporated by reference in a renewal. A                                            
31 renewed notice filing becomes effective upon the expiration of the filing being                                         
01       renewed.                                                                                                          
02 (c)  With respect to a security that is a federal covered security under 15 U.S.C.                                      
03 77r(b)(4)(D) (Securities Act of 1933), a regulation adopted under this chapter may                                      
04 require a notice filing by or on behalf of an issuer to include a copy of Form D,                                       
05 including the Appendix, as adopted by the Securities and Exchange Commission, and                                       
06 a consent to service of process complying with AS 45.56.630 signed by the issuer not                                    
07 later than 15 days after the first sale of the federal covered security in this state and the                           
08 payment of a fee established in a regulation adopted under this chapter; and the                                        
09 payment of a fee established in a regulation adopted under this chapter for any late                                    
10       filing.                                                                                                           
11 (d)  Except with respect to a federal covered security under 15 U.S.C. 77r(b)(1)                                        
12 (Securities Act of 1933), if the administrator finds that there is a failure to comply                                  
13 with a notice or fee requirement of this section, the administrator may issue a stop                                    
14 order suspending the offer and sale of a federal covered security in this state. If the                                 
15 deficiency is corrected, the stop order is void as of the time of its issuance and a                                    
16       penalty may not be imposed by the administrator.                                                                  
17 Sec. 45.56.340. Viatical settlement interests. (a) Before the sale of a viatical                                      
18 settlement interest, an issuer shall provide a prospective buyer with information that is                               
19 sufficient to make an informed investment decision. The issuer shall also provide the                                   
20 information to the administrator upon request if the issuer is not otherwise required to                                
21 file the information with the administrator. In this subsection, "information that is                                   
22 sufficient to make an informed investment decision" includes state-mandated                                             
23 disclosure forms and a disclosure of any significant factors that may affect the                                        
24       outcome of the investment.                                                                                        
25 (b)  Except as may be required in the course of conduct of the responsibilities                                         
26 of the administrator, an issuer of a viatical settlement interest may not disclose to                                   
27 another person the identity of the viator or insured of the insurance policy that is the                                
28 subject of the viatical settlement interest. The viator may waive this prohibition                                      
29       against disclosure if the waiver is in writing and signed by the viator.                                          
30 (c)  The administrator shall regulate transactions between a viatical settlement                                        
31 provider or person acting as an agent of a viatical settlement provider and a                                           
01       subsequent investor, while the authority of the director of the division of insurance                             
02       extends to the regulation of viatical settlement contracts under AS 21.96.110.                                    
03            (d)  In this section,                                                                                        
04                 (1)  "viatical settlement contract" has the meaning given in                                            
05       AS 21.96.110(h);                                                                                                  
06                 (2)  "viatical settlement interest"                                                                     
07                      (A)  means the entire interest or any fractional interest in a life                                
08            insurance policy or in the death benefit under a life insurance policy that is the                           
09            subject of a viatical settlement contract;                                                                   
10 (B)  does not include the initial purchase from the viator by a                                                         
11            viatical settlement provider;                                                                                
12 (3)  "viatical settlement provider" has the meaning given in                                                            
13       AS 21.96.110(h);                                                                                                  
14                 (4)  "viator" has the meaning given in AS 21.96.110(h).                                                 
15 Sec. 45.56.350. Waiver and modification. The administrator may waive or                                               
16 modify, in whole or in part, any or all of the requirements of AS 45.56.305 and                                         
17 45.56.320 or the requirement of any information or record in a registration statement                                   
18       or in a periodic report filed under AS 45.56.320(i).                                                            
19 Sec. 45.56.360. Denial, suspension, and revocation of securities                                                      
20 registration. (a) The administrator may issue a stop order denying effectiveness to, or                               
21 suspending or revoking the effectiveness of, a registration statement if the                                            
22       administrator finds that the order is in the public interest and that                                             
23 (1)  the registration statement as of the effective date of the registration                                            
24 statement or before the effective date in the case of an order denying effectiveness, an                                
25 amendment under AS 45.56.320(j) as of the effective date of the amendment, or a                                         
26 report under AS 45.56.320(i) is incomplete in a material respect or contains a                                          
27 statement that, in the light of the circumstances under which it was made, was false or                                 
28       misleading with respect to a material fact;                                                                       
29 (2)  this chapter or a regulation adopted, order issued, or condition                                                   
30 imposed under this chapter has been wilfully violated in connection with the offering                                   
31       by                                                                                                                
01                      (A)  the person filing the registration statement;                                                 
02                      (B)  the issuer, a partner, officer, or director of the issuer or a                                
03            person having a similar status or performing a similar function;                                             
04                      (C)  a promoter of the issuer;                                                                     
05                      (D)  a person directly or indirectly controlling or controlled by                                  
06            the issuer, but only if the person filing the registration statement is directly or                          
07            indirectly controlled by or acting for the issuer; or                                                        
08                      (E)  an underwriter;                                                                               
09                 (3)  the security registered or sought to be registered is the subject of a                             
10 permanent or temporary injunction of a court of competent jurisdiction or an                                            
11 administrative stop order or similar order issued under any federal, foreign, or state                                  
12 law other than this chapter applicable to the offering; the administrator may not                                       
13 institute a proceeding against an effective registration statement under this paragraph                                 
14 more than one year after the date of the order or injunction on which it is based, and                                  
15 the administrator may not issue an order under this paragraph based on an order or                                      
16 injunction issued under the securities act of another state unless the order or injunction                              
17 was based on conduct that would constitute, as of the date of the order, a ground for a                                 
18       stop order under this section;                                                                                    
19 (4)  the issuer's enterprise or method of business includes or would                                                    
20       include activities that are unlawful where performed;                                                             
21 (5)  with respect to a security sought to be registered under                                                           
22 AS 45.56.305, there has been a failure to comply with the undertaking required by                                       
23       AS 45.56.305(b)(3);                                                                                               
24 (6)  the applicant or registrant has not paid the filing fee; the                                                       
25 administrator shall void the order if the deficiency is corrected and the order was                                     
26       based solely on the nonpayment of the filing fee; or                                                              
27                 (7)  the offering                                                                                       
28 (A)  will work or tend to work a fraud on purchasers or would                                                           
29            operate to work or tend to work a fraud on purchasers;                                                       
30 (B)  has been or would be made with unreasonable amounts of                                                             
31 underwriters' and sellers' discounts, commissions, or other compensation, or                                            
01            promoters' profits or participations, or unreasonable amounts or kinds of                                    
02            options; or                                                                                                  
03                      (C)  is being made on terms that are unfair, unjust, or                                            
04            inequitable.                                                                                                 
05            (b)  To the extent practicable, the administrator shall, by a regulation adopted                             
06       or order issued under this chapter, publish standards that provide notice of conduct                              
07       that violates (a)(7) of this section.                                                                             
08            (c)  The administrator may not institute a stop order proceeding against an                                  
09       effective registration statement based on conduct or a transaction known to the                                   
10 administrator when the registration statement became effective unless the proceeding                                    
11       is instituted within 30 days after the registration statement became effective.                                   
12 (d)  The administrator may summarily revoke, deny, postpone, or suspend the                                             
13 effectiveness of a registration statement pending final determination of an                                             
14 administrative proceeding. Upon the issuance of the order, the administrator shall                                      
15 promptly notify each person specified in (e) of this section that the order has been                                    
16 issued, the reasons for the revocation, denial, postponement, or suspension, and that,                                  
17 within 15 days after the receipt of a request in a record from the person, the matter will                              
18 be scheduled for a hearing. If, within 30 days after the date of service of the order, a                                
19 hearing is not requested and none is ordered by the administrator, the order becomes                                    
20 final. If a hearing is requested or ordered, the administrator, after notice of and                                     
21 opportunity for hearing for each person subject to the order, may modify or vacate the                                  
22       order or extend the order until final determination.                                                              
23            (e)  A stop order may not be issued under this section without                                               
24 (1)  appropriate notice to the applicant or registrant, the issuer, and the                                             
25       person on whose behalf the securities are to be or have been offered;                                             
26 (2)  an opportunity for hearing conducted in the manner provided in                                                     
27       AS 45.56.650(c); and                                                                                              
28                 (3)  findings of fact and conclusions of law in a record.                                               
29 (f)  The administrator may modify or vacate a stop order issued under this                                              
30 section if the administrator finds that the conditions that caused its issuance have                                    
31 changed or that it is necessary or appropriate in the public interest or for the protection                             
01       of investors.                                                                                                     
02       Article 4. Broker-Dealers, Agents, Investment Advisers, Investment Adviser                                      
03            Representatives, and Federal Covered Investment Advisers.                                                  
04 Sec. 45.56.405. Broker-dealer registration requirement and exemptions.                                                
05 (a) A person may not transact business in this state as a broker-dealer unless the                                      
06 person is registered under this chapter as a broker-dealer or is exempt from registration                               
07       as a broker-dealer under (b) of this section.                                                                     
08            (b)  The following persons are exempt from the registration requirement of (a)                               
09       of this section:                                                                                                  
10 (1)  a broker-dealer without a place of business in this state if the                                                   
11       broker-dealer's only transactions effected in this state are with                                                 
12                      (A)  the issuer of the securities involved in the transactions;                                    
13 (B)  a broker-dealer registered as a broker-dealer under this                                                           
14            chapter or not required to be registered as a broker-dealer under this chapter;                              
15                      (C)  an institutional investor;                                                                    
16 (D)  a nonaffiliated federal covered investment adviser with                                                            
17 investments under management in excess of $100,000,000 acting for the                                                   
18            account of others under discretionary authority in a signed record;                                          
19 (E)  a bona fide preexisting customer whose principal place of                                                          
20 residence is not in this state if the person is registered as a broker-dealer under                                     
21 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934) or not required to be                                            
22 registered under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934) and                                             
23 is registered under the securities act of the state in which the customer                                               
24            maintains a principal place of residence;                                                                    
25 (F)  a bona fide preexisting customer whose principal place of                                                          
26 residence is in this state but who was not present in this state when the                                               
27            customer relationship was established if                                                                     
28 (i)  the broker-dealer is registered under 15 U.S.C. 78a -                                                              
29 78pp (Securities Exchange Act of 1934) or not required to be registered                                                 
30 under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934) and is                                                     
31 registered under the securities act of the state in which the customer                                                  
01                 relationship was established and where the customer had maintained a                                    
02                 principal place of residence; and                                                                       
03 (ii)  within 45 days after the customer's first transaction                                                             
04 in this state, the person files an application for registration as a broker-                                            
05 dealer in this state and a further transaction is not effected more than 75                                             
06 days after the date on which the application is filed, or, if earlier, the                                              
07 date on which the administrator notifies the person that the                                                            
08 administrator has denied the application for registration or has stayed                                                 
09                 the pendency of the application for good cause;                                                         
10 (G)  not more than three customers in this state during the                                                             
11 previous 12 months, in addition to those customers specified in (A) - (F) of this                                       
12 paragraph and under (H) of this paragraph if the broker-dealer is registered                                            
13 under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934) or not required                                            
14 to be registered under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934)                                           
15 and is registered under the securities act of the state in which the broker-dealer                                      
16            has its principal place of business; and                                                                     
17 (H)  any other person exempted by a regulation adopted or order                                                         
18            issued under this chapter; and                                                                               
19 (2)  a person that deals solely in United States government securities                                                  
20 and is supervised as a dealer in government securities by the Board of Governors of                                     
21 the Federal Reserve System, the United States Comptroller of the Currency, or the                                       
22       Federal Deposit Insurance Corporation.                                                                            
23 (c)  A broker-dealer or an issuer engaged in offering, offering to purchase,                                            
24 purchasing, or selling securities in this state may not, directly or indirectly, employ or                              
25 associate with an individual to engage in an activity related to securities transactions in                             
26 this state if the registration of the individual is suspended or revoked or the individual                              
27 is barred from employment or association with a broker-dealer, an issuer, an                                            
28 investment adviser, or a federal covered investment adviser by an order of the                                          
29 administrator under this chapter, the Securities and Exchange Commission, or a self-                                    
30 regulatory organization. A broker-dealer or issuer does not violate this subsection if                                  
31 the broker-dealer or issuer did not know and, in the exercise of reasonable care, could                                 
01       not have known of the suspension, revocation, or bar. Upon request from a broker-                                 
02       dealer or issuer and for good cause, an order under this chapter may modify or waive,                             
03       in whole or in part, the application of the prohibitions of this subsection to the broker-                        
04       dealer.                                                                                                           
05 Sec. 45.56.410. Limited registration of Canadian broker-dealers and                                                   
06 agents. (a) If a broker-dealer is registered under this section and its principal office is                           
07 located in a province or territory of Canada that provides at least equivalent                                          
08 registration for a broker-dealer that is resident in the United States, a broker-dealer                                 
09 that is resident in Canada and does not have an office or other physical presence in this                               
10 state may effect transactions in securities with or for or induce or attempt to induce the                              
11       purchase or sale of a security by a person from Canada who is                                                     
12 (1)  temporarily resident in this state and with whom the Canadian                                                      
13 broker-dealer had a bona fide broker-dealer-client relationship before the person                                       
14       entered the United States; or                                                                                     
15 (2)  resident in this state and whose transactions are in a self-directed                                               
16 tax-advantaged retirement plan in Canada if the person is the holder of or contributor                                  
17       to the plan.                                                                                                      
18 (b)  An agent who represents a Canadian broker-dealer registered under this                                             
19 section may, if the agent is registered under this section, effect transactions in                                      
20       securities in this state as permitted for the broker-dealer under (a) of this section.                            
21 (c)  Subject to the requirements of (a) of this section, a Canadian broker-dealer                                       
22       may register under this section if the broker-dealer                                                              
23 (1)  files an application in the form required by the jurisdiction in which                                             
24       the broker-dealer has its principal office;                                                                       
25                 (2)  files a written consent to service of process under AS 45.56.630;                                  
26 (3)  is registered as a broker or dealer in good standing in the                                                        
27 jurisdiction from which the broker-dealer is effecting transactions into this state and                                 
28       files evidence of the registration; and                                                                           
29 (4)  is a member of a self-regulating organization or stock exchange in                                                 
30       Canada.                                                                                                           
31 (d)  An agent may register under this section to effect transactions in securities                                      
01       in this state if the agent represents a Canadian broker-dealer that is registered under                           
02       this section, and the agent                                                                                       
03                 (1)  files an application in the form required by the jurisdiction in which                             
04       the broker-dealer has its principal office;                                                                       
05                 (2)  files a written consent to service of process under AS 45.56.630;                                  
06       and                                                                                                               
07                 (3)  is registered and files evidence of good standing in the jurisdiction                              
08       from which the agent is effecting transactions into this state.                                                   
09            (e)  Registration under this section becomes effective on the 30th day after an                              
10 application is filed unless it is made effective earlier by the administrator or a denial                               
11       order is in effect and a proceeding is pending under AS 45.56.485.                                                
12            (f)  A Canadian broker-dealer registered under this section shall                                            
13 (1)  maintain provincial or territorial registration and membership in                                                  
14       good standing in a self-regulating organization or stock exchange;                                                
15 (2)  provide the administrator on request with books and records                                                        
16       relating to its business in this state as a broker-dealer;                                                        
17 (3)  inform the administrator promptly of any criminal action taken                                                     
18 against the broker-dealer or of any finding or sanction imposed on the broker-dealer as                                 
19 a result of regulatory action, including that of a self-regulating organization, involving                              
20       fraud, theft, deceit, misrepresentation, or similar conduct; and                                                  
21 (4)  disclose to its clients in this state that the broker-dealer and its                                               
22       agents are not subject to the full regulatory requirements of this chapter.                                       
23            (g)  An agent of a Canadian broker-dealer registered under this section shall                                
24                 (1)  maintain provincial or territorial registration in good standing; and                              
25 (2)  inform the administrator promptly of any criminal action taken                                                     
26 against the agent or of any finding or sanction imposed on the broker-dealer or agent                                   
27 as a result of regulatory action, including that of a self-regulating organization,                                     
28       involving fraud, theft, deceit, misrepresentation, or similar conduct.                                            
29 (h)  A Canadian broker-dealer or agent registered under this section may renew                                          
30 its registration by filing by midnight on December 31 of each year the most recent                                      
31 renewal application, if any, filed in the jurisdiction in which the broker-dealer or agent                              
01       has its principal office or, if a renewal application is not required, the most recent                            
02       application filed under (c)(1) or (d)(1) of this section.                                                         
03            (i)  An applicant for registration or renewal registration under this section shall                          
04       pay the fee for broker-dealers and agents required by this chapter.                                               
05            (j)  A Canadian broker-dealer or agent registered under this section may not                                 
06       effect transactions in this state except                                                                          
07                 (1)  as permitted under (a) or (b) of this section;                                                     
08                 (2)  with or through                                                                                    
09                      (A)  the issuers of the securities involved in the transactions;                                   
10                      (B)  other broker-dealers; or                                                                      
11 (C)  banks, savings institutions, trust companies, insurance                                                            
12 companies, investment companies as defined in 15 U.S.C. 80a-3 (Investment                                               
13 Company Act of 1940), pension or profit-sharing trusts, or other financial                                              
14 institutions or institutional buyers, whether acting for themselves or as trustees;                                     
15            or                                                                                                           
16                 (3)  as otherwise permitted by this chapter.                                                            
17 (k)  A Canadian broker-dealer or agent registered under this section and acting                                         
18 in accordance with the limitations in (j) of this section is exempt from all of the                                     
19 requirements of this chapter except the anti-fraud provisions under AS 45.56.505 and                                    
20 the requirements of this section. The registration of a Canadian broker-dealer or agent                                 
21 under this section may not be denied, suspended, or revoked except in accordance with                                   
22 the provisions of AS 45.56.485 for a breach of the anti-fraud provisions under                                          
23       AS 45.56.505 or the requirements of this section.                                                                 
24 (l)  In this section, "Canadian broker-dealer" means a broker-dealer that has its                                       
25       principal office in a province or territory of Canada.                                                            
26 Sec. 45.56.420. Registration exemption for merger and acquisition broker.                                             
27 (a) Except as provided in (b) and (c) of this section, a merger and acquisition broker is                               
28       exempt from registration under AS 45.56.405.                                                                      
29 (b)  A merger and acquisition broker is not exempt from registration under                                              
30       AS 45.56.405 if the broker                                                                                        
31 (1)  directly or indirectly, in connection with the transfer of ownership                                               
01 of an eligible privately held company, receives, holds, transmits, or has custody of the                                
02       funds or securities to be exchanged by the parties to the transaction;                                            
03 (2)  engages on behalf of an issuer in a public offering of any class of                                                
04 securities that is registered, or is required to be registered, with the United States                                  
05 Securities and Exchange Commission under 15 U.S.C. 78l(b) (Securities Exchange                                          
06 Act of 1934) or with respect to which the issuer files, or is required to file, periodic                                
07 information, documents, and reports under 15 U.S.C. 78o(d) (Securities Exchange Act                                     
08       of 1934); or                                                                                                      
09 (3)  engages on behalf of any party in a transaction involving a public                                                 
10       shell company.                                                                                                    
11 (c)  A merger and acquisition broker is not exempt from registration under                                              
12       AS 45.56.405 if the broker is subject to                                                                          
13 (1)  suspension or revocation of registration under 15 U.S.C. 78o(b)(4)                                                 
14       (Securities Exchange Act of 1934);                                                                                
15 (2)  a statutory disqualification described in 15 U.S.C. 78c(a)(39)                                                     
16       (Securities Exchange Act of 1934);                                                                                
17 (3)  a disqualification established by the rules adopted by the United                                                  
18 States Securities and Exchange Commission under Public Law 112-106, sec. 302(d),                                        
19       for 15 U.S.C. 77d (Dodd-Frank Wall Street Reform and Consumer Protection Act); or                                 
20 (4)  a final order described in 15 U.S.C. 78o(b)(4)(H) (Securities                                                      
21       Exchange Act of 1934).                                                                                            
22 (d)  This section may not be construed to limit any other authority of the                                              
23 department to exempt any person, or any class of persons, from a provision of this                                      
24       chapter, or a provision of a rule or regulation adopted under this chapter.                                       
25            (e)  In this section,                                                                                        
26 (1)  "control" means the power, directly or indirectly, to direct the                                                   
27 management or policies of a company, whether through ownership of securities, by                                        
28       contract, or otherwise; there is a presumption of control for any person who                                      
29 (A)  is a director, general partner, limited liability company                                                          
30 member, limited liability company manager, an officer who exercises                                                     
31 executive responsibility, or an officer who has status or functions similar to an                                       
01            officer who exercises executive responsibility;                                                              
02                      (B)  has the right to vote 20 percent or more of a class of voting                                 
03            securities or the power to sell or direct the sale of 20 percent or more of a class                          
04            of voting securities; or                                                                                     
05                      (C)  in the case of a partnership or limited liability company,                                    
06            has the right to receive upon dissolution, or has contributed, 20 percent or more                            
07            of the capital;                                                                                              
08                 (2)  "eligible privately held company" means a company that                                             
09                      (A)  does not have any class of securities registered, or required                                 
10 to be registered, with the United States Securities and Exchange Commission                                             
11 under 15 U.S.C. 78l(b) (Securities Exchange Act of 1934), or with respect to                                            
12 which the company files, or is required to file, periodic information,                                                  
13 documents, and reports under 15 U.S.C. 78o(d) (Securities Exchange Act of                                               
14            1934); and                                                                                                   
15 (B)  in the fiscal year ending immediately before the fiscal year                                                       
16 in which the services of the merger and acquisition broker are initially engaged                                        
17 with respect to the securities transaction, meets either or both of the following                                       
18 conditions, determined in accordance with the historical financial accounting                                           
19            records of the company:                                                                                      
20 (i)  the earnings of the company before interest, taxes,                                                                
21                 depreciation, and amortization are less than $25,000,000;                                               
22 (ii)  the gross revenue of the company is less than                                                                     
23                 $250,000,000;                                                                                           
24 (3)  "merger and acquisition broker" means a broker, and a person                                                       
25 associated with the broker, engaged in the business of effecting securities transactions                                
26 solely in connection with the transfer of ownership of an eligible privately held                                       
27 company, regardless of whether that broker acts on behalf of a seller or buyer, through                                 
28 the purchase, sale, exchange, issuance, repurchase, or redemption of, or a business                                     
29 combination involving, securities or assets of the eligible privately held company, if                                  
30       the broker reasonably believes that                                                                               
31 (A)  upon consummation of the transaction, a person acquiring                                                           
01 securities or assets of the eligible privately held company, acting alone or in                                         
02 concert, will control and, directly or indirectly, be active in the management of                                       
03 the eligible privately held company or the business conducted with the assets                                           
04            of the eligible privately held company; and                                                                  
05 (B)  if a person is offered securities in exchange for securities or                                                    
06 assets of the eligible privately held company, the person will, before becoming                                         
07 legally bound to consummate the transaction, receive or have reasonable                                                 
08 access to the most recent fiscal year-end financial statements of the issuer of                                         
09 the securities as customarily prepared by its management in the normal course                                           
10 of operations and, if the financial statements of the issuer are audited,                                               
11 reviewed, or compiled, any related statement by the independent accountant; a                                           
12 balance sheet dated not more than 120 days before the date of the exchange                                              
13 offer; and information pertaining to the management, business, results of                                               
14 operations for the period covered by the foregoing financial statements, and                                            
15            any material loss contingencies of the issuer;                                                               
16 (4)  "public shell company" means a company that, at the time of a                                                      
17       transaction with an eligible privately held company,                                                              
18 (A)  has any class of securities registered, or required to be                                                          
19 registered, with the United States Securities and Exchange Commission under                                             
20 15 U.S.C. 78l(b), or with respect to which the company files, or is required to                                         
21            file, periodic information, documents, and reports under 15 U.S.C. 78o(d);                                   
22                      (B)  has no assets or has nominal operations; and                                                  
23                      (C)  has                                                                                           
24                           (i)  no assets or has nominal assets;                                                         
25 (ii)  assets consisting solely of cash and cash                                                                         
26                 equivalents; or                                                                                         
27 (iii)  assets consisting of any amount of cash and cash                                                                 
28                 equivalents and nominal other assets.                                                                   
29 Sec. 45.56.430. Agent registration requirement and exemptions. (a) An                                                 
30 individual may not transact business in this state as an agent unless the individual is                                 
31 registered under this chapter as an agent or is exempt from registration as an agent                                    
01       under (b) of this section.                                                                                        
02            (b)  The following individuals are exempt from the registration requirement of                               
03       (a) of this section:                                                                                              
04                 (1)  an individual who represents a broker-dealer in effecting                                          
05       transactions in this state limited to those described in 15 U.S.C. 78o(i);                                        
06                 (2)  an individual who represents a broker-dealer that is exempt under                                  
07       AS 45.56.405(b) or 45.56.410;                                                                                     
08                 (3)  an individual who represents an issuer with respect to an offer or                                 
09       sale of the issuer's own securities or those of the issuer's parent or any of the issuer's                        
10 subsidiaries and who is not compensated in connection with the individual's                                             
11 participation by the payment of commissions or other remuneration based, directly or                                    
12       indirectly, on transactions in those securities;                                                                  
13 (4)  an individual who represents an issuer and who effects transactions                                                
14 in the issuer's securities exempted by AS 45.56.210, other than AS 45.56.210(11) and                                    
15       (14);                                                                                                             
16 (5)  an individual who represents an issuer that effects transactions                                                   
17 solely in federal covered securities of the issuer, but an individual who effects                                       
18 transactions in a federal covered security under 15 U.S.C. 77r(b)(3) or (b)(4)(D)                                       
19 (Securities Act of 1933) is not exempt if the individual is compensated in connection                                   
20 with the agent's participation by the payment of commissions or other remuneration                                      
21       based, directly or indirectly, on transactions in those securities;                                               
22 (6)  an individual who represents a broker-dealer registered in this state                                              
23 under AS 45.56.405(a) or exempt from registration under AS 45.56.405(b) in the offer                                    
24 and sale of securities for an account of a nonaffiliated federal covered investment                                     
25 adviser with investments under management in excess of $100,000,000 acting for the                                      
26       account of others under discretionary authority in a signed record;                                               
27 (7)  an individual who represents an issuer in connection with the                                                      
28       purchase of the issuer's own securities;                                                                          
29 (8)  an individual who represents an issuer and who restricts                                                           
30       participation to performing clerical or ministerial acts; or                                                      
31 (9)  any other individual exempted by a regulation adopted or order                                                     
01       issued under this chapter.                                                                                        
02            (c)  The registration of an agent is effective only while the agent is employed                              
03       by or associated with a broker-dealer registered under this chapter or an issuer that is                          
04       offering, selling, or purchasing the issuer's securities in this state.                                           
05 (d)  A broker-dealer or an issuer engaged in offering, selling, or purchasing                                           
06 securities in this state may not employ or associate with an agent who transacts                                        
07 business in this state on behalf of broker-dealers or issuers unless the agent is                                       
08 registered under (a) of this section or exempt from registration under (b) of this                                      
09       section.                                                                                                          
10 (e)  An individual may not act as an agent for more than one broker-dealer or                                           
11 one issuer at a time, unless the broker-dealer or the issuer for which the agent acts is                                
12 affiliated by direct or indirect common control or is authorized by a regulation or order                               
13       issued under this chapter.                                                                                        
14 Sec. 45.56.435. Investment adviser registration requirement and                                                       
15 exemptions. (a) A person may not transact business in this state as an investment                                     
16 adviser unless the person is registered under this chapter as an investment adviser or is                               
17       exempt from registration as an investment adviser under (b) of this section.                                      
18 (b)  The following persons are exempt from the registration requirement in (a)                                          
19       of this section:                                                                                                  
20 (1)  a person without a place of business in this state that is registered                                              
21 under the securities act of the state in which the person has the person's principal place                              
22       of business if the person's only clients in this state are                                                        
23 (A)  federal covered investment advisers, investment advisers                                                           
24            registered under this chapter, or broker-dealers registered under this chapter;                              
25                      (B)  institutional investors;                                                                      
26 (C)  bona fide preexisting clients whose principal places of                                                            
27 residence are not in this state if the investment adviser is registered under the                                       
28 securities act of the state in which the clients maintain principal places of                                           
29            residence; or                                                                                                
30 (D)  exempt by a regulation adopted or order issued under this                                                          
31            chapter;                                                                                                     
01 (2)  a person without a place of business in this state if the person has                                               
02 had, during the preceding 12 months, not more than five clients that are resident in this                               
03       state in addition to those specified under (1) of this subsection; or                                             
04 (3)  any other person exempted by a regulation adopted or order issued                                                  
05       under this chapter.                                                                                               
06 (c)  An investment adviser may not, directly or indirectly, employ or associate                                         
07 with an individual to engage in an activity related to investment advice in this state if                               
08 the registration of the individual is suspended or revoked or the individual is barred                                  
09 from employment or association with an investment adviser, federal covered                                              
10 investment adviser, or broker-dealer by an order under this chapter, the Securities and                                 
11 Exchange Commission, or a self-regulatory organization, unless the investment                                           
12 adviser did not know and, in the exercise of reasonable care, could not have known of                                   
13 the suspension, revocation, or bar. Upon request from the investment adviser and for                                    
14 good cause, the administrator may by order, waive, in whole or in part, the application                                 
15       of the prohibitions of this subsection to the investment adviser.                                                 
16 (d)  An investment adviser may not employ or associate with an individual                                               
17 required to be registered under this chapter as an investment adviser representative                                    
18 who transacts business in this state on behalf of the investment adviser unless the                                     
19 individual is registered under AS 45.56.440(a) or is exempt from registration under                                     
20       AS 45.56.440(b).                                                                                                  
21 Sec. 45.56.440. Investment adviser representative registration requirement                                            
22 and exemptions. (a) An individual may not transact business in this state as an                                       
23 investment adviser representative unless the individual is registered under this chapter                                
24 as an investment adviser representative or is exempt from registration as an investment                                 
25       adviser representative under (b) of this section.                                                                 
26 (b)  The following individuals are exempt from the registration requirement of                                          
27       (a) of this section:                                                                                              
28 (1)  an individual who is employed by or associated with an investment                                                  
29 adviser that is exempt from registration under AS 45.56.435(b) or a federal covered                                     
30 investment adviser that is excluded from the notice filing requirements of                                              
31       AS 45.56.445; and                                                                                                 
01 (2)  any other individual exempted by a regulation adopted or order                                                     
02       issued under this chapter.                                                                                        
03 (c)  The registration of an investment adviser representative is not effective                                          
04 while the investment adviser representative is not employed by or associated with an                                    
05 investment adviser registered under this chapter or a federal covered investment                                        
06       adviser that has made or is required to make a notice filing under AS 45.56.445.                                  
07 (d)  An individual may transact business as an investment adviser                                                       
08 representative for more than one investment adviser or federal covered investment                                       
09 adviser unless a regulation adopted or order issued under this chapter prohibits or                                     
10 limits an individual from acting as an investment adviser representative for more than                                  
11       one investment adviser or federal covered investment adviser.                                                     
12 (e)  An individual acting as an investment adviser representative may not,                                              
13 directly or indirectly, conduct business in this state on behalf of an investment adviser                               
14 or a federal covered investment adviser if the registration of the individual as an                                     
15 investment adviser representative is suspended or revoked or the individual is barred                                   
16 from employment or association with an investment adviser or a federal covered                                          
17 investment adviser by an order under this chapter, the Securities and Exchange                                          
18 Commission, or a self-regulatory organization. Upon request from a federal covered                                      
19 investment adviser and for good cause, the administrator may by order, waive, in                                        
20 whole or in part, the application of the requirements of this subsection to the federal                                 
21       covered investment adviser.                                                                                       
22 (f)  An investment adviser registered under this chapter, a federal covered                                             
23 investment adviser that has filed a notice under AS 45.56.445, or a broker-dealer                                       
24 registered under this chapter is not required to employ or associate with an individual                                 
25 as an investment adviser representative if the only compensation paid to the individual                                 
26 for a referral of investment advisory clients is paid to an investment adviser registered                               
27 under this chapter, a federal covered investment adviser who has filed a notice under                                   
28 AS 45.56.445, or a broker-dealer registered under this chapter with which the                                           
29       individual is employed or associated as an investment adviser representative.                                     
30 Sec. 45.56.445. Federal covered investment adviser notice filing                                                      
31 requirement. (a) Except with respect to a federal covered investment adviser                                          
01       described in (b) of this section, a federal covered investment adviser may not transact                           
02       business in this state as a federal covered investment adviser unless the federal                                 
03       covered investment adviser complies with (c) of this section.                                                     
04            (b)  The following federal covered investment advisers are not required to                                   
05       comply with (c) of this section:                                                                                  
06                 (1)  a federal covered investment adviser without a place of business in                                
07       this state if the only clients of the federal covered investment adviser in this state are                        
08                      (A)  federal covered investment advisers, investment advisers                                      
09            registered under this chapter, and broker-dealers registered under this chapter;                             
10                      (B)  institutional investors;                                                                      
11 (C)  bona fide preexisting clients whose principal places of                                                            
12            residence are not in this state; or                                                                          
13 (D)  other clients specified by a regulation adopted or order                                                           
14            issued under this chapter;                                                                                   
15 (2)  a federal covered investment adviser without a place of business in                                                
16 this state if the person has had, during the preceding 12 months, not more than five                                    
17 clients that are resident in this state in addition to those specified under (1) of this                                
18       subsection; and                                                                                                   
19 (3)  any other person excluded by a regulation adopted or order issued                                                  
20       under this chapter.                                                                                               
21 (c)  A person acting as a federal covered investment adviser not excluded                                               
22 under (b) of this section shall file a notice, a consent to service of process complying                                
23 with AS 45.56.630, and the records that have been filed with the Securities and                                         
24 Exchange Commission under 15 U.S.C. 80b-1 - 80b-21 (Investment Advisers Act of                                          
25 1940) as required by a regulation adopted or order issued under this chapter and shall                                  
26       pay the fees specified in AS 45.56.470.                                                                           
27            (d)  The notice under (c) of this section becomes effective upon filing.                                     
28 Sec. 45.56.450. Registration by broker-dealer, agent, investment adviser,                                             
29 and investment adviser representative. (a) A person shall register as a broker-dealer,                                
30 agent, investment adviser, or investment adviser representative by filing an application                                
31 and a consent to service of process complying with AS 45.56.630 and by paying the                                       
01       fee specified in AS 45.56.470 and any reasonable fees charged by the designee of the                              
02       administrator for processing the filing. The application must contain                                             
03                 (1)  the information or record required for the filing of a uniform                                     
04       application; and                                                                                                  
05                 (2)  upon request by the administrator, any other financial or other                                    
06       information or record that the administrator determines is appropriate.                                           
07            (b)  If the information or record contained in an application filed under (a) of                             
08       this section is or becomes inaccurate or incomplete in a material respect, the registrant                         
09       shall promptly file a correcting amendment.                                                                       
10 (c)  If an order is not in effect, and a proceeding is not pending under                                                
11 AS 45.56.485, and the administrator has not initiated an investigation, registration                                    
12 becomes effective at noon on the 45th day after a completed application is filed, unless                                
13 the registration is denied. A regulation adopted or order issued under this chapter may                                 
14 set an earlier effective date or may defer the effective date until noon on the 45th day                                
15       after the filing of any amendment completing the application.                                                     
16 (d)  A registration is effective until midnight on December 31 of the year for                                          
17 which the application for registration is filed. Unless an order is in effect under                                     
18 AS 45.56.485, a registration may be automatically renewed each year by filing the                                       
19 records required by a regulation adopted or order issued under this chapter, by paying                                  
20 the fee specified in AS 45.56.470, and by paying costs charged by the designee of the                                   
21       administrator for processing the filings.                                                                         
22 (e)  A regulation adopted or order issued under this chapter may impose other                                           
23 conditions, not inconsistent with 15 U.S.C. 77b, 77c, 77e, 77f, 77r, 77z-3, 77ddd, 78b                                  
24 - 78d, 78g, 78h, 78n, 78o, 78q, 78bb, 78ee, 78kk, 78mm, 80a-2, 80a-3, 80a-6, 80a-12,                                    
25 80a-24, 80a-26, 80a-27, 80a-29, 80a-30, 80a-34, 80a-51, 80a-54, 80a-60, 80a-63, 80b-                                    
26 2, 80b-3a, 80b-5, 80b-10, 80b-18a, and 80b-20, and 29 U.S.C. 1002 (National                                             
27 Securities Markets Improvement Act of 1996). An order issued under this chapter may                                     
28 waive, in whole or in part, specific requirements in connection with registration that                                  
29       are in the public interest and for the protection of investors.                                                   
30 Sec. 45.56.455. Succession and change in registration of broker-dealer or                                             
31 investment adviser. (a) A broker-dealer or investment adviser may succeed to the                                      
01 current registration of another broker-dealer or investment adviser or a notice filing of                               
02 a federal covered investment adviser, and a federal covered investment adviser may                                      
03 succeed to the current registration of an investment adviser or notice filing of another                                
04 federal covered investment adviser, by filing as a successor an application for                                         
05 registration under AS 45.56.405 or 45.56.435 or a notice under AS 45.56.445 for the                                     
06       unexpired portion of the current registration or notice filing.                                                   
07 (b)  A broker-dealer or investment adviser that changes its form of                                                     
08 organization or state of incorporation or organization may continue its registration by                                 
09 filing an amendment to its registration if the change does not involve a material                                       
10 change in its financial condition or management. The amendment becomes effective                                        
11 when filed or on a date designated by the registrant in its filing. The new organization                                
12 is a successor to the original registrant for the purposes of this chapter. If there is a                               
13 material change in financial condition or management, the broker-dealer or investment                                   
14 adviser shall file a new application for registration. A predecessor registered under this                              
15 chapter shall stop conducting its securities business other than winding down                                           
16 transactions and shall file for withdrawal of broker-dealer or investment adviser                                       
17       registration within 45 days after filing its amendment to effect succession.                                      
18 (c)  A broker-dealer or investment adviser that changes its name may continue                                           
19 its registration by filing an amendment to its registration. The amendment becomes                                      
20       effective when filed or on a date designated by the registrant.                                                   
21 (d)  A change of control of a broker-dealer or investment adviser may be made                                           
22       in accordance with a regulation adopted or order issued under this chapter.                                       
23 Sec. 45.56.460. Termination of employment or association of agent and                                                 
24 investment adviser representative and transfer of employment or association. (a)                                      
25 If an agent registered under this chapter terminates employment by or association with                                  
26 a broker-dealer or issuer, or if an investment adviser representative registered under                                  
27 this chapter terminates employment by or association with an investment adviser or                                      
28 federal covered investment adviser, or if either registrant terminates activities that                                  
29 require registration as an agent or investment adviser representative, the broker-dealer,                               
30 issuer, investment adviser, or federal covered investment adviser shall promptly file a                                 
31 notice of termination. The registrant may file the notice of termination if the registrant                              
01 learns that the broker-dealer, issuer, investment adviser, or federal covered investment                                
02       adviser has not filed the notice.                                                                                 
03 (b)  If an agent registered under this chapter terminates employment by or                                              
04 association with a broker-dealer registered under this chapter and begins employment                                    
05 by or association with another broker-dealer registered under this chapter, or if an                                    
06 investment adviser representative registered under this chapter terminates employment                                   
07 by or association with an investment adviser registered under this chapter or a federal                                 
08 covered investment adviser that has filed a notice under AS 45.56.445 and begins                                        
09 employment by or association with another investment adviser registered under this                                      
10 chapter or a federal covered investment adviser that has filed a notice under                                           
11 AS 45.56.445, then, within 30 days after the termination, upon the filing by or on                                      
12 behalf of the registrant of an application for registration that complies with the                                      
13 requirement of AS 45.56.450(a) and payment of the filing fee required under                                             
14       AS 45.56.470, the registration of the agent or investment adviser representative is                               
15 (1)  immediately effective as of the date of the completed filing, if the                                               
16 agent's record or successor record in the Central Registration Depository operated by                                   
17 the Financial Industry Regulatory Authority or the investment adviser representative's                                  
18 record or successor record in the Investment Adviser Registration Depository operated                                   
19 by the Financial Industry Regulatory Authority does not contain a new or amended                                        
20       disciplinary disclosure within the previous 12 months; or                                                         
21 (2)  temporarily effective as of the date of the completed filing, if the                                               
22 agent's record or successor record in the Central Registration Depository operated by                                   
23 the Financial Industry Regulatory Authority or the investment adviser representative's                                  
24 record or successor record in the Investment Adviser Registration Depository operated                                   
25 by the Financial Industry Regulatory Authority contains a new or amended                                                
26       disciplinary disclosure within the preceding 12 months.                                                           
27 (c)  The administrator may withdraw a temporary registration if there are or                                            
28 were grounds for discipline as specified in AS 45.56.485 and the administrator does so                                  
29 within 30 days after the filing of the application. If the administrator does not                                       
30 withdraw the temporary registration within the 30-day period, registration becomes                                      
31       automatically effective on the 31st day after filing.                                                             
01 (d)  The administrator may prevent the effectiveness of a transfer of an agent                                          
02 or investment adviser representative under (b)(1) or (2) of this section based on the                                   
03       public interest and the protection of investors.                                                                  
04 (e)  If the administrator determines that a registrant or applicant for registration                                    
05 is no longer in existence, has ceased to act as a broker-dealer, agent, investment                                      
06 adviser, or investment adviser representative, is the subject of an adjudication of                                     
07 incapacity, is subject to the control of a committee, conservator, or guardian, or cannot                               
08 reasonably be located, a regulation adopted or order issued under this chapter may                                      
09 require that the registration be cancelled or terminated or the application be denied.                                  
10 The administrator may reinstate a cancelled or terminated registration, with or without                                 
11       hearing, and may make the registration retroactive.                                                               
12 Sec. 45.56.465. Withdrawal of registration of broker-dealer, agent,                                                   
13 investment adviser, and investment adviser representative. Withdrawal of                                              
14 registration by a broker-dealer, agent, investment adviser, or investment adviser                                       
15 representative becomes effective 60 days after the filing of the application to withdraw                                
16 or within any shorter period as provided by a regulation adopted or order issued under                                  
17 this chapter unless a revocation or suspension proceeding is pending when the                                           
18 application is filed. If a proceeding is pending, withdrawal becomes effective when                                     
19 and upon the conditions required by a regulation adopted or order issued under this                                     
20 chapter. The administrator may institute a revocation or suspension proceeding under                                    
21 AS 45.56.485 within one year after the withdrawal became effective automatically and                                    
22 issue a revocation or suspension order as of the last date on which registration was                                    
23       effective if a proceeding is not pending.                                                                         
24 Sec. 45.56.470. Fees. (a) The administrator shall establish fees by regulation                                        
25       for                                                                                                               
26 (1)  an initial filing of an application as a broker-dealer and renewal of                                              
27       an application by a broker-dealer for registration;                                                               
28 (2)  an application for registration as an agent and renewal of                                                         
29       registration as an agent;                                                                                         
30 (3)  an application for registration as an investment adviser and renewal                                               
31       of registration as an investment adviser;                                                                         
01                 (4)  an application for registration as an investment adviser                                           
02       representative, a renewal of registration as an investment adviser representative, and a                          
03       change of registration as an investment adviser representative; and                                               
04                 (5)  an initial fee and annual notice fee for a federal covered investment                              
05       adviser required to file a notice under AS 45.56.445.                                                             
06            (b)  A person required to pay a filing or notice fee under this section may                                  
07       transmit the fee through or to a designee as provided by a regulation adopted or order                            
08       issued under this chapter.                                                                                        
09            (c)  The administrator may establish other fees by regulation as necessary to                                
10       administer this chapter.                                                                                          
11 Sec. 45.56.475. Post registration requirements. (a) Subject to 15 U.S.C.                                              
12 78o(i) or 80b-18a, a regulation adopted or order issued under this chapter may                                          
13 establish minimum financial requirements for broker-dealers registered or required to                                   
14 be registered under this chapter and investment advisers registered or required to be                                   
15       registered under this chapter.                                                                                    
16 (b)  Subject to 15 U.S.C. 78o(i) or 80b-18a, a broker-dealer registered or                                              
17 required to be registered under this chapter and an investment adviser registered or                                    
18 required to be registered under this chapter shall file the financial reports required by a                             
19 regulation adopted or order issued under this chapter. If the information contained in a                                
20 record filed under this subsection is or becomes inaccurate or incomplete in a material                                 
21       respect, the registrant shall promptly file a correcting amendment.                                               
22            (c)  Subject to 15 U.S.C. 78o(i) or 80b-18a,                                                                 
23 (1)  a broker-dealer registered or required to be registered under this                                                 
24 chapter and an investment adviser registered or required to be registered under this                                    
25 chapter shall make and maintain the accounts, correspondence, memoranda, papers,                                        
26 books, and other records required by a regulation adopted or order issued under this                                    
27       chapter;                                                                                                          
28 (2)  broker-dealer records required to be maintained under (1) of this                                                  
29 subsection may be maintained in any form of data storage acceptable under 15 U.S.C.                                     
30       78q(a) if they are readily accessible to the administrator; and                                                   
31 (3)  investment adviser records required to be maintained under (1) of                                                  
01 this subsection may be maintained in any form of data storage required by a regulation                                  
02       adopted or order issued under this chapter.                                                                       
03 (d)  The records of a broker-dealer registered or required to be registered under                                       
04 this chapter and of an investment adviser registered or required to be registered under                                 
05 this chapter are subject to the reasonable periodic, special, or other audits or                                        
06 inspections by a representative of the administrator, in or outside this state, that the                                
07 administrator considers necessary or appropriate in the public interest and for the                                     
08 protection of investors. An audit or inspection may be made at any time and without                                     
09 prior notice. The administrator may copy and remove for audit or inspection copies of                                   
10 all records the administrator reasonably considers necessary or appropriate to conduct                                  
11 the audit or inspection. The administrator may assess a reasonable charge for                                           
12       conducting an audit or inspection under this subsection.                                                          
13 (e)  Subject to 15 U.S.C. 78o(i) or 80b-18a, a regulation adopted or order                                              
14 issued under this chapter may require a broker-dealer or investment adviser that has                                    
15 custody of or discretionary authority over funds or securities of a customer or client to                               
16 obtain insurance or post a bond or other satisfactory form of security in an amount                                     
17 established by a regulation adopted under this chapter. The administrator may                                           
18 determine the requirements of the insurance, bond, or other satisfactory form of                                        
19 security. Insurance or a bond or other satisfactory form of security may not be required                                
20 of a broker-dealer registered under this chapter whose net capital exceeds, or of an                                    
21 investment adviser registered under this chapter whose minimum financial                                                
22 requirements exceed, the amounts required by a regulation adopted or order issued                                       
23 under this chapter. The insurance, bond, or other satisfactory form of security must                                    
24 permit an action by a person to enforce any liability on the insurance, bond, or other                                  
25 satisfactory form of security if instituted within the time limitations in                                              
26       AS 45.56.660(j)(2).                                                                                               
27 (f)  Subject to 15 U.S.C. 78o(i) or 80b-18a, an agent may not have custody of                                           
28 funds or securities of a customer except under the supervision of a broker-dealer, and                                  
29 an investment adviser representative may not have custody of funds or securities of a                                   
30 client except under the supervision of an investment adviser or a federal covered                                       
31 investment adviser. A regulation adopted or order issued under this chapter may                                         
01 prohibit, limit, or impose conditions on a broker-dealer regarding custody of funds or                                  
02 securities of a customer and on an investment adviser regarding custody of securities                                   
03       or funds of a client.                                                                                             
04 (g)  With respect to an investment adviser registered or required to be                                                 
05 registered under this chapter, a regulation adopted or order issued under this chapter                                  
06 may require that information or other records be furnished or disseminated to clients                                   
07 or prospective clients in this state as necessary or appropriate in the public interest and                             
08       for the protection of investors and advisory clients.                                                             
09 (h)  A regulation adopted or order issued under this chapter may require an                                             
10 individual registered under AS 45.56.430 or 45.56.440 to participate in a continuing                                    
11 education program approved by the Securities and Exchange Commission and                                                
12 administered by a self-regulatory organization, or, in the absence of a continuing                                      
13 education program, a regulation adopted or order issued under this chapter may                                          
14       require continuing education for an individual registered under AS 45.56.440.                                     
15 Sec. 45.56.480. Protecting older and vulnerable adults from financial                                                 
16 exploitation. (a) If a broker-dealer, investment adviser, or qualified individual                                     
17 reasonably believes that the financial exploitation of a covered adult may have                                         
18 occurred, may have been attempted, or is being attempted, the broker-dealer,                                            
19 investment adviser, or qualified individual shall notify adult protective services and                                  
20 the administrator not later than five days after the broker-dealer, investment adviser, or                              
21 qualified individual develops the reasonable belief that the financial exploitation or                                  
22 attempted financial exploitation has or may have occurred, or is being attempted,                                       
23 except that the broker-dealer, investment adviser, or qualified individual shall notify                                 
24 adult protective services and the administrator immediately upon confirmation of the                                    
25       financial exploitation or attempted financial exploitation of the covered adult.                                  
26 (b)  The requirements of (a) of this section may not be construed to require                                            
27 more than one notification for each occurrence of exploitation or attempted                                             
28       exploitation.                                                                                                     
29 (c)  If a broker-dealer, investment adviser, or qualified individual reasonably                                         
30 believes that financial exploitation of a covered adult may have occurred, may have                                     
31 been attempted, or is being attempted, a broker-dealer, investment adviser, or qualified                                
01 individual may notify a person whom the covered adult previously designated to be                                       
02 notified about financial matters of the covered adult, as well as any other person                                      
03 allowed under state or federal law or regulation, or the rules of a self-regulatory                                     
04 organization, except that the broker-dealer, investment adviser, or qualified individual                                
05 may not notify a person that is suspected of engaging in financial exploitation or other                                
06       abuse of the covered adult.                                                                                       
07 (d)  A broker-dealer or investment adviser may delay a disbursement from an                                             
08 account of a covered adult or from an account on which a covered adult is a                                             
09       beneficiary if                                                                                                    
10 (1)  the broker-dealer, investment adviser, or qualified individual                                                     
11 reasonably believes, after initiating an internal review of the requested disbursement                                  
12 and the suspected financial exploitation of a covered adult, that the requested                                         
13       disbursement may result in financial exploitation of the covered adult; and                                       
14                 (2)  the broker-dealer or investment adviser                                                            
15 (A)  within two business days after receiving the request for                                                           
16 disbursement, provides written notification of the delay and the reason for the                                         
17 delay to all persons authorized to transact business on the account, except to a                                        
18 person that the broker-dealer, investment adviser, or qualified individual                                              
19 reasonably believes has engaged in suspected or attempted financial                                                     
20            exploitation of the covered adult;                                                                           
21 (B)  within two business days after receiving the request for                                                           
22            disbursement, notifies adult protective services and the administrator; and                                  
23 (C)  continues as necessary an internal review of the suspected                                                         
24 or attempted financial exploitation of the covered adult and, within seven                                              
25 business days after receiving the request for disbursement, reports the status of                                       
26 the investigation to adult protective services and the administrator, and                                               
27 provides additional status updates to the administrator and adult protective                                            
28            services upon request.                                                                                       
29 (e)  A disbursement delay under (d) of this section expires when the earlier of                                         
30       the following events occurs:                                                                                      
31 (1)  the broker-dealer or investment adviser determines that the                                                        
01       disbursement will not result in financial exploitation of the covered adult;                                      
02                 (2)  15 business days after the date on which the broker-dealer or                                      
03       investment adviser first delayed the disbursement, unless                                                         
04 (A)  adult protective services or the administrator requests that                                                       
05 the broker-dealer or investment adviser extend the delay, in which case the                                             
06 delay expires 25 business days after the date on which the broker-dealer or                                             
07            investment adviser first delayed disbursement; or                                                            
08                      (B)  adult protective services, the administrator, or the superior                                 
09            court terminates the delay.                                                                                  
10 (f)  Adult protective services, the administrator, the broker-dealer or                                                 
11 investment adviser that initiated the delay under (d) or (e) of this section, or another                                
12 interested person may petition the superior court for an order extending a                                              
13 disbursement delay or providing other relief to a covered adult, and the superior court                                 
14       may enter an order providing the requested relief.                                                                
15 (g)  A broker-dealer or investment adviser shall provide access to or copies of                                         
16 records that are relevant to the suspected or attempted financial exploitation of a                                     
17 covered adult to adult protective services and to state law enforcement agencies as part                                
18 of a referral to adult protective services or an investigation. The records that may be                                 
19 accessed or copied under this subsection include records relating to past transactions                                  
20 that may have involved financial exploitation of the covered adult as well as records                                   
21 relating to the most recent transaction that may involve financial exploitation of the                                  
22 covered adult. Records made available to agencies under this subsection are not public                                  
23 records as defined in AS 40.25.220. This subsection does not limit or impede the                                        
24 authority of the administrator to access or examine the books and records of broker-                                    
25       dealers and investment advisers as otherwise provided by law.                                                     
26 (h)  A broker-dealer, investment adviser, or qualified individual acting in good                                        
27 faith and exercising reasonable care under (a) - (g) of this section is immune from                                     
28 administrative or civil liability for a notification, disclosure, disbursement delay, or                                
29       record sharing under (a) - (g) of this section.                                                                   
30 (i)  The following constitute the financial exploitation of a covered adult under                                       
31       this section:                                                                                                     
01                 (1)  the wrongful or unauthorized taking, withholding, appropriation, or                                
02       use of the money, assets, or other property of a covered adult; or                                                
03                 (2)  an act or omission of a person, including an act or omission made                                  
04       through the use of a power of attorney, guardianship, or conservatorship of a covered                             
05       adult, to                                                                                                         
06 (A)  obtain control, through deception, intimidation, or undue                                                          
07 influence, over the covered adult's money, assets, or other property to deprive                                         
08 the covered adult of the ownership, use, benefit, or possession of the covered                                          
09            adult's money, assets, or other property; or                                                                 
10 (B)  convert the ownership, use, benefit, or possession of the                                                          
11            covered adult's money, assets, or other property to another person.                                          
12            (j)  In this section,                                                                                        
13 (1)  "adult protective services" means the agency that has the                                                          
14       responsibility for providing protective services for adults; in this paragraph,                                   
15                      (A)  "agency" has the meaning given in AS 44.64.200;                                               
16 (B)  "protective services" has the meaning given in                                                                     
17            AS 47.24.900;                                                                                                
18                 (2)  "covered adult" means a natural person who is                                                      
19                      (A)  60 years of age or older; or                                                                  
20                      (B)  a vulnerable adult;                                                                           
21 (3)  "qualified individual" means an agent, investment adviser                                                          
22 representative, or other person who is acting in a supervisory, compliance, or legal                                    
23       capacity for a broker-dealer or investment adviser.                                                               
24 Sec. 45.56.485. Denial, revocation, suspension, withdrawal, restriction,                                              
25 condition, or limitation of registration. (a) If the administrator finds that the order is                            
26 in the public interest and (d) of this section authorizes the action, an order issued under                             
27 this chapter may deny an application, or may condition or limit registration of an                                      
28 applicant to be a broker-dealer, agent, investment adviser, or investment adviser                                       
29 representative, and, if the applicant is a broker-dealer or investment adviser, of a                                    
30 partner, officer, director, or person having a similar status or performing similar                                     
31 functions, or a person directly or indirectly in control, of the broker-dealer or                                       
01       investment adviser.                                                                                               
02 (b)  If the administrator finds that the order is in the public interest and (d) of                                     
03 this section authorizes the action, an order issued under this chapter may revoke,                                      
04 suspend, condition, or limit the registration of a registrant, and, if the registrant is a                              
05 broker-dealer or investment adviser, of a partner, officer, director, or person having a                                
06 similar status or performing similar functions, or a person directly or indirectly in                                   
07 control, of the broker-dealer or investment adviser. However, the administrator may                                     
08       not                                                                                                               
09 (1)  institute a revocation or suspension proceeding under this                                                         
10 subsection based on an order issued under a law of another state that is reported to the                                
11 administrator or a designee of the administrator more than three years after the date of                                
12       the order on which it is based; or                                                                                
13 (2)  under (d)(5)(A) and (B) of this section, issue an order based on an                                                
14 order issued under the securities act of another state unless the other order was based                                 
15 on conduct for which (d) of this section would authorize the action had the conduct                                     
16       occurred in this state.                                                                                           
17 (c)  If the administrator finds that the order is in the public interest and (d)(1) -                                   
18 (6), (8) - (10), (12), or (13) of this section authorize the action, an order under this                                
19 chapter may censure, impose a bar, or impose a civil penalty of not more than                                           
20 $100,000 for a single violation on a registrant and, if the registrant is a broker-dealer                               
21 or investment adviser, on a partner, officer, director, or person having a similar status                               
22 or performing similar functions, or on a person directly or indirectly in control of the                                
23       broker-dealer or investment adviser.                                                                              
24            (d)  A person may be disciplined under (a) - (c) of this section if the person                               
25 (1)  has filed, within the previous 10 years under this chapter or former                                               
26 AS 45.55, an application for registration in this state that, as of the effective date of                               
27 registration or as of any date after filing in the case of an order denying effectiveness,                              
28 was incomplete in any material respect or contained a statement that, in light of the                                   
29 circumstances under which it was made, was false or misleading with respect to a                                        
30       material fact;                                                                                                    
31 (2)  wilfully violated or wilfully failed to comply with this chapter or                                                
01 former AS 45.55 or a regulation adopted or order issued under this chapter or former                                    
02       AS 45.55 within the previous 10 years;                                                                            
03 (3)  has been convicted of a felony or within the previous 10 years has                                                 
04 been convicted of a misdemeanor involving a security, a commodity future or option                                      
05 contract, or an aspect of a business involving securities, commodities, investments,                                    
06       franchises, insurance, banking, or finance;                                                                       
07 (4)  is enjoined or restrained by a court of competent jurisdiction in an                                               
08 action instituted by the administrator under this chapter or former AS 45.55, by a state,                               
09 by the Securities and Exchange Commission, or by the United States from engaging in                                     
10 or continuing an act, practice, or course of business involving an aspect of a business                                 
11 involving securities, commodities, investments, franchises, insurance, banking, or                                      
12       finance;                                                                                                          
13 (5)  is the subject of an order issued after notice and opportunity for                                                 
14       hearing by                                                                                                        
15 (A)  the securities or other financial services regulator of a state                                                    
16 or the Securities and Exchange Commission or other federal agency denying,                                              
17 revoking, barring, or suspending registration as a broker-dealer, agent,                                                
18 investment adviser, federal covered investment adviser, or investment adviser                                           
19            representative;                                                                                              
20 (B)  the securities regulator of a state or the Securities and                                                          
21 Exchange Commission against a broker-dealer, agent, investment adviser,                                                 
22            investment adviser representative, or federal covered investment adviser;                                    
23 (C)  the Securities and Exchange Commission or a self-                                                                  
24 regulatory organization suspending or expelling the registrant from                                                     
25            membership in the self-regulatory organization;                                                              
26 (D)  a court adjudicating a United States Postal Service fraud                                                          
27            order;                                                                                                       
28 (E)  the insurance regulator of a state denying, suspending, or                                                         
29            revoking registration as an insurance agent; or                                                              
30 (F)  a depository institution or financial services regulator                                                           
31 suspending or barring the person from the depository institution or other                                               
01            financial services business;                                                                                 
02 (6)  is the subject of an adjudication or determination, after notice and                                               
03 opportunity for hearing, by the Securities and Exchange Commission, the Commodity                                       
04 Futures Trading Commission, the Federal Trade Commission, a federal depository                                          
05 institution regulator, or a depository institution, insurance, or other financial services                              
06 regulator of a state that the person wilfully violated 15 U.S.C. 77a - 77aa (Securities                                 
07 Act of 1933), 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934), 15 U.S.C. 80b-                                    
08 1 - 80b-21 (Investment Advisers Act of 1940), 15 U.S.C. 80a-1 - 80a-64 (Investment                                      
09 Company Act of 1940), or 7 U.S.C. 1 - 27 (Commodity Exchange Act), the securities                                       
10 or commodities law of a state, or a federal or state law under which a business                                         
11       involving investments, franchises, insurance, banking, or finance is regulated;                                   
12 (7)  is insolvent, either because the person's liabilities exceed the                                                   
13 person's assets or because the person cannot meet the person's obligations as they                                      
14 mature, but the administrator may not enter an order against an applicant or registrant                                 
15       under this paragraph without a finding of insolvency as to the applicant or registrant;                           
16 (8)  refuses to allow or otherwise impedes the administrator from                                                       
17 conducting an audit or inspection under AS 45.56.475(d) or refuses access to a                                          
18       registrant's office to conduct an audit or inspection under AS 45.56.475(d);                                      
19 (9)  has failed to reasonably supervise an agent, investment adviser                                                    
20 representative, or other individual, if the agent, investment adviser representative, or                                
21 other individual was subject to the person's supervision and committed a violation of                                   
22 this chapter or former AS 45.55 or a regulation adopted or order issued under this                                      
23       chapter or former AS 45.55;                                                                                       
24 (10)  has not paid the proper filing fee within 30 days after having been                                               
25 notified by the administrator of a deficiency, but the administrator shall vacate an                                    
26       order under this paragraph when the deficiency is corrected;                                                      
27                 (11)  after notice and opportunity for a hearing, has been found                                        
28 (A)  by a court of competent jurisdiction to have wilfully                                                              
29 violated the laws of a foreign jurisdiction under which the business of                                                 
30 securities, commodities, investment, franchises, insurance, banking, or finance                                         
31            is regulated;                                                                                                
01 (B)  to have been the subject of an order of a securities regulator                                                     
02 of a foreign jurisdiction denying, revoking, or suspending the right to engage                                          
03 in the business of securities as a broker-dealer, agent, investment adviser,                                            
04            investment adviser representative, or similar person; or                                                     
05 (C)  to have been suspended or expelled from membership by or                                                           
06 participation in a securities exchange or securities association operating under                                        
07            the securities laws of a foreign jurisdiction;                                                               
08 (12)  is the subject of a cease and desist order issued by the Securities                                               
09 and Exchange Commission or issued under the securities, commodities, investment,                                        
10       franchise, banking, finance, or insurance laws of a state;                                                        
11 (13)  has engaged in dishonest or unethical practices in the securities,                                                
12       commodities, investment, franchise, banking, finance, or insurance business;                                      
13 (14)  is not qualified based on factors that may include training,                                                      
14 experience, and knowledge of the securities business; however, in the case of an                                        
15 application by an agent for a broker-dealer that is a member of a self-regulatory                                       
16 organization or by an individual for registration as an investment adviser                                              
17 representative, a denial order may not be based on this paragraph if the individual has                                 
18 successfully completed all examinations required by (e) of this section; the                                            
19 administrator may require an applicant for registration under AS 45.56.430 or                                           
20 45.56.440 who has not been registered in a state within the two years preceding the                                     
21       filing of an application in this state to complete successfully an examination; or                                
22 (15)  is a person whose license renewal is denied under AS 14.43.148                                                    
23       or whose license issuance or renewal is denied under AS 25.27.244.                                                
24 (e)  A regulation adopted or order issued under this chapter may require that an                                        
25 examination, including an examination developed or approved by an organization of                                       
26 securities regulators, be successfully completed by a class of individuals or all                                       
27 individuals. An order issued under this chapter may waive, in whole or in part, an                                      
28 examination as to an individual and a regulation adopted under this chapter may                                         
29 waive, in whole or in part, an examination as to a class of individuals if the                                          
30 administrator determines that the examination is not necessary or appropriate in the                                    
31       public interest and for the protection of investors.                                                              
01 (f)  The administrator may suspend or deny an application summarily; restrict,                                          
02 condition, limit, or suspend a registration; or censure, bar, or impose a civil penalty on                              
03 a registrant before final determination of an administrative proceeding. Upon the                                       
04 issuance of an order, the administrator shall promptly notify each person subject to the                                
05 order that the order has been issued, the reasons for the action, and that, within 15 days                              
06 after the receipt of a request in a record from the person, the matter will be scheduled                                
07 for a hearing. If a hearing is not requested and none is ordered by the administrator                                   
08 within 30 days after the date of service of the order, the order becomes final by                                       
09 operation of law. If a hearing is requested or ordered, the administrator, after notice of                              
10 and opportunity for hearing to each person subject to the order, may modify or vacate                                   
11       the order or extend the order until final determination.                                                          
12 (g)  An order may not be issued under this section, except under (f) of this                                            
13 section, without appropriate notice to the applicant or registrant, and an opportunity                                  
14       for hearing under AS 45.56.650(c).                                                                                
15 (h)  A person that controls, directly or indirectly, a person not in compliance                                         
16 with this section may be disciplined by order of the administrator under (a) - (c) of this                              
17 section to the same extent as the noncomplying person, unless the controlling person                                    
18 did not know, and in the exercise of reasonable care could not have known, of the                                       
19       existence of conduct that is a ground for discipline under this section.                                          
20 (i)  The administrator may not institute a proceeding under (a) - (c) of this                                           
21 section based solely on material facts actually known by the administrator unless an                                    
22 investigation or the proceeding is instituted within one year after the administrator                                   
23       actually acquires knowledge of the material facts.                                                                
24                      Article 5. Fraud and Liabilities.                                                                
25 Sec. 45.56.505. General fraud. A person may not, in connection with the                                               
26       offer, sale, or purchase of a security, directly or indirectly,                                                   
27                 (1)  employ a device, scheme, or artifice to defraud;                                                   
28 (2)  make an untrue statement of a material fact or omit to state a                                                     
29 material fact necessary to make the statements made, in light of the circumstances                                      
30       under which they were made, not misleading; or                                                                    
31 (3)  engage in an act, practice, or course of business that operates or                                                 
01       would operate as a fraud or deceit on another person.                                                             
02 Sec. 45.56.510. Prohibited conduct in providing investment advice. (a) A                                              
03 person that advises others for compensation, either directly or indirectly or through                                   
04 publications or writings, as to the value of securities or the advisability of investing in,                            
05 purchasing, or selling securities or that, for compensation and as part of a regular                                    
06       business, issues or adopts analyses or reports relating to securities may not                                     
07                 (1)  employ a device, scheme, or artifice to defraud another person; or                                 
08                 (2)  engage in an act, practice, or course of business that operates or                                 
09       would operate as a fraud or deceit on another person.                                                             
10 (b)  A regulation adopted under this chapter may define an act, practice, or                                            
11 course of business of an investment adviser or an investment adviser representative,                                    
12 other than a supervised person of a federal covered investment adviser, as fraudulent,                                  
13 deceptive, or manipulative and may prescribe means reasonably designed to prevent                                       
14 investment advisers and investment adviser representatives, other than supervised                                       
15 persons of a federal covered investment adviser, from engaging in acts, practices, and                                  
16       courses of business defined as fraudulent, deceptive, or manipulative.                                            
17 (c)  A regulation adopted under this chapter may specify the contents of an                                             
18 investment advisory contract entered into, extended, or renewed by an investment                                        
19       adviser.                                                                                                          
20 Sec. 45.56.520. Misleading filings. A person may not, in a document filed                                             
21 with the administrator or in a proceeding under this chapter, make or cause to be made                                  
22 an untrue statement of a material fact or omit to state a material fact necessary in order                              
23 to make the statements made, in the light of the circumstances under which they are                                     
24       made, not misleading.                                                                                             
25 Sec. 45.56.530. Misrepresentations concerning registration or exemption.                                              
26 The filing of an application for registration, a registration statement, a notice filing                                
27 under this chapter, the registration of a person, the notice filing by a person, or the                                 
28 registration of a security under this chapter does not constitute a finding by the                                      
29 administrator that a record filed under this chapter is true, complete, and not                                         
30 misleading. The filing or registration or the availability of an exemption, exception,                                  
31 preemption, or exclusion for a security or a transaction does not mean that the                                         
01 administrator has passed on the merits or qualifications of, or recommended or given                                    
02 approval to, a person, security, or transaction. A person may not make, or cause to be                                  
03 made, to a purchaser, customer, client, or prospective customer or client a                                             
04       representation inconsistent with this section.                                                                    
05 Sec. 45.56.540. Evidentiary burden. (a) In a civil action or administrative                                           
06 proceeding under this chapter, a person claiming an exemption, exception,                                               
07       preemption, or exclusion has the burden to prove the applicability of the claim.                                  
08 (b)  In a criminal proceeding under this chapter, an exemption, exception,                                              
09 preemption, or exclusion claimed by the defendant is an affirmative defense. In this                                    
10       subsection, "affirmative defense" has the meaning given in AS 11.81.900.                                          
11 Sec. 45.56.550. Filing of sales and advertising literature. (a) Except as                                             
12 otherwise provided in (b) of this section, a regulation adopted or order issued under                                   
13 this chapter may require the filing of a prospectus, pamphlet, circular, form letter,                                   
14 advertisement, sales literature, or other advertising record relating to a security or                                  
15 investment advice, addressed or intended for distribution to prospective investors,                                     
16 including clients or prospective clients of a person registered or required to be                                       
17       registered as an investment adviser under this chapter.                                                         
18 (b)  This section does not apply to sales and advertising literature specified in                                       
19 (a) of this section that relates to a federal covered security, a federal covered                                       
20 investment adviser, or a security or transaction exempted by AS 45.56.205, 45.56.210,                                   
21       45.56.220, or 45.56.240, except as required under AS 45.56.205(7).                                                
22 (c)  The administrator may by regulation or order prohibit the publication,                                             
23       circulation, or use of any advertising considered false or misleading.                                            
24 Sec. 45.56.560. Qualified immunity. A broker-dealer, agent, investment                                                
25 adviser, federal covered investment adviser, or investment adviser representative is not                                
26 liable to another broker-dealer, agent, investment adviser, federal covered investment                                  
27 adviser, or investment adviser representative for defamation relating to a statement                                    
28 that is contained in a record required by the administrator, a designee of the                                          
29 administrator, the Securities and Exchange Commission, or a self-regulatory                                             
30 organization, unless the person knew, or should have known at the time the statement                                    
31 was made, that it was false in a material respect or the person acted in reckless                                       
01       disregard of the statement's truth or falsity.                                                                    
02                 Article 6. Administration and Judicial Review.                                                        
03            Sec. 45.56.605. Administration. (a) The department shall administer this                                   
04       chapter.                                                                                                          
05 (b)  The administrator or an officer, employee, or designee of the administrator                                        
06 may not use for personal benefit or the benefit of others records or other information                                  
07 obtained by or filed with the administrator that is not public under AS 45.56.615(b).                                   
08 This chapter does not authorize the administrator or an officer, employee, or designee                                  
09 of the administrator to disclose the record or information, except in accordance with                                   
10       AS 45.56.615(c), 45.56.620, or 45.56.645.                                                                         
11 (c)  This chapter does not create or diminish a privilege or exemption that                                             
12       exists at common law, by statute or regulation, or otherwise.                                                     
13 (d)  The administrator may develop and implement investor education                                                     
14 initiatives to inform the public about investing in securities, with particular emphasis                                
15 on the prevention and detection of securities fraud. In developing and implementing                                     
16 these initiatives, the administrator may collaborate with public and nonprofit                                          
17 organizations with an interest in investor education. The administrator may accept a                                    
18 grant or donation from a person that is not affiliated with the securities industry or                                  
19 from a nonprofit organization, regardless of whether the organization is affiliated with                                
20 the securities industry, to develop and implement investor education initiatives. This                                  
21 subsection does not authorize the administrator to require participation or monetary                                    
22       contributions of a registrant in an investor education program.                                                   
23 Sec. 45.56.610. Administrative files and opinions. (a) The administrator shall                                        
24 maintain, or designate a person to maintain, a register of applications for registration                                
25 of securities; registration statements; notice filings; applications for registration of                                
26 broker-dealers, agents, investment advisors, and investment adviser representatives;                                    
27 notice filings by federal covered investment advisors that are or have been effective                                   
28 under this chapter or former AS 45.55; notices of claims of exemption from                                              
29 registration or notice filing requirements contained in a record; orders issued under                                   
30 this chapter or former AS 45.55; and interpretative opinions or no-action                                               
31 determinations issued under this chapter. The register must be kept according to the                                    
01       existing retention schedule mandated by the department.                                                           
02            (b)  The administrator shall make all regulations, forms, interpretative                                     
03       opinions, and orders available to the public.                                                                     
04 (c)  The administrator shall furnish a copy of a record that is a public record or                                      
05 a certification that the public record does not exist to a person upon request. A copy of                               
06 the record certified or a certificate by the administrator of a record's nonexistence is                                
07       prima facie evidence of a record or its nonexistence.                                                             
08            Sec. 45.56.615. Public records; confidentiality. (a) Except as otherwise                                   
09       provided in (b) of this section, records obtained by the administrator or filed under this                        
10 chapter, including a record contained in or filed with a registration statement,                                        
11 application, notice filing, or report are public records and are available for public                                   
12       examination under AS 40.25.100 - 40.25.295 (Alaska Public Records Act).                                         
13 (b)  The following records are not public records under AS 40.25.100 -                                                  
14 40.25.295 (Alaska Public Records Act) and are not available for public examination                                      
15       under (a) of this section:                                                                                        
16 (1)  a record obtained by the administrator in connection with an audit,                                                
17 examination or inspection under AS 45.56.475(d) or an investigation under                                               
18       AS 45.56.645;                                                                                                     
19 (2)  a part of a record filed in connection with a registration statement                                               
20 under AS 45.56.105 and 45.56.305 - 45.56.320 or a record under AS 45.56.475(d) that                                     
21 contains trade secrets or confidential information if the person filing the registration                                
22 statement or report has asserted a claim of confidentiality or privilege that is                                        
23       authorized by law;                                                                                                
24 (3)  a record that is not required to be provided to the administrator or                                               
25 filed under this chapter and is provided to the administrator only on the condition that                                
26       the record may not be subject to public examination or disclosure;                                                
27 (4)  a nonpublic record received from a person specified in                                                             
28       AS 45.56.620(a); and                                                                                              
29 (5)  a social security number, residential address unless used as a                                                     
30 business address, and residential telephone number unless used as a business                                            
31       telephone number, contained in a record that is filed.                                                            
01 (c)  If disclosure is for the purpose of a civil, administrative, or criminal                                           
02 investigation, action, or proceeding or to a person specified in AS 45.56.620(a), the                                   
03 administrator may disclose a record obtained in connection with an audit or inspection                                  
04 under AS 45.56.475(d) or a record obtained in connection with an investigation under                                    
05       AS 45.56.645.                                                                                                     
06 Sec. 45.56.620. Uniformity and cooperation with other agencies. (a) The                                               
07 administrator may cooperate, coordinate, consult, and, subject to AS 45.56.615, share                                   
08 records and information with the securities regulator of another state, Canada, a                                       
09 Canadian province or territory, a foreign jurisdiction, the Securities and Exchange                                     
10 Commission, the United States Department of Justice, the Commodity Futures                                              
11 Trading Commission, the Federal Trade Commission, the Securities Investor                                               
12 Protection Corporation, a self-regulatory organization, a national or international                                     
13 organization of securities regulators, a federal or state banking and insurance                                         
14 regulator, and a governmental law enforcement agency to bring about greater                                             
15 uniformity in securities matters among the federal government, self-regulatory                                          
16       organizations, states, and foreign governments.                                                                   
17 (b)  In cooperating, coordinating, consulting, and sharing records and                                                  
18 information under this section and in acting by regulation, order, or waiver under this                                 
19 chapter, the administrator may take into consideration in carrying out the public                                       
20       interest the following general policies:                                                                          
21 (1)  maximizing effectiveness of regulation for the protection of                                                       
22       investors;                                                                                                        
23 (2)  maximizing uniformity in federal and state regulatory standards;                                                   
24       and                                                                                                               
25 (3)  minimizing burdens on the business of capital formation, without                                                   
26       adversely affecting essentials of investor protection.                                                            
27 (c)  The cooperation, coordination, consultation, and sharing of records and                                            
28       information authorized by this section includes                                                                   
29 (1)  establishing or employing one or more designees as a central                                                       
30 depository for registration and notice filings under this chapter and for records                                       
31       required or allowed to be maintained under this chapter;                                                          
01                 (2)  developing and maintaining uniform forms;                                                          
02                 (3)  conducting a joint examination or investigation;                                                   
03                 (4)  holding a joint administrative hearing;                                                            
04                 (5)  instituting and prosecuting a joint civil or administrative                                        
05       proceeding;                                                                                                       
06                 (6)  sharing and exchanging personnel;                                                                  
07                 (7)  coordinating registrations under AS 45.56.105 and 45.56.405 -                                      
08       45.56.440 and exemptions under AS 45.56.240;                                                                      
09                 (8)  sharing and exchanging records, subject to AS 45.56.615;                                           
10 (9)  formulating regulations, statements of policy, guidelines, forms,                                                  
11       and interpretative opinions and releases;                                                                         
12                 (10)  formulating common systems and procedures;                                                        
13 (11)  notifying the public of proposed regulations, forms, statements of                                                
14       policy, and guidelines;                                                                                           
15 (12)  attending conferences and other meetings among securities                                                         
16 regulators, that may include representatives of governmental and private sector                                         
17 organizations involved in capital formation, considered necessary or appropriate to                                     
18       promote or achieve uniformity; and                                                                                
19 (13)  developing and maintaining a uniform exemption from                                                               
20 registration for small issuers and taking other steps to reduce the burden of raising                                   
21       investment capital by small businesses.                                                                           
22 Sec. 45.56.625. Securities investor education and training fund. The                                                  
23 securities investor education and training fund is created as a special fund in the                                     
24 general fund to provide funds for the purposes specified in 45.56.605(d). The                                           
25 legislature may appropriate 33 percent of the money received by this state from civil                                   
26 penalties under this chapter into the fund for securities investor education and training.                              
27 Nothing in this section exempts money deposited into the fund from the requirements                                     
28       of AS 37.07 (Executive Budget Act) or dedicates money for a specific purpose.                                     
29 Sec. 45.56.630. Service of process. (a) A consent to service of process                                               
30 complying with this section required by this chapter shall be signed and filed in the                                   
31 form required by a regulation adopted or order issued under this chapter. A consent                                     
01 appointing the administrator the person's agent for service of process in a noncriminal                                 
02 action or proceeding against the person or the person's successor or personal                                           
03 representative under this chapter or a regulation adopted or order issued under this                                    
04 chapter after the consent is filed has the same force and validity as if the service were                               
05 made personally on the person filing the consent. A person that has filed a consent                                     
06 under this subsection in connection with a previous application for registration or                                     
07       notice filing need not file an additional consent.                                                                
08 (b)  If a person, including a nonresident of this state, engages in an act,                                             
09 practice, or course of business prohibited or made actionable by this chapter or a                                      
10 regulation adopted or order issued under this chapter and the person has not filed a                                    
11 consent to service of process under (a) of this section, the act, practice, or course of                                
12 business constitutes the appointment of the administrator as the person's agent for                                     
13 service of process in a noncriminal action or proceeding against the person or the                                      
14       person's successor or personal representative.                                                                    
15 (c)  Service under (a) or (b) of this section may be made by providing a copy of                                        
16       the process to the office of the administrator, but the service is not effective unless                           
17 (1)  the plaintiff, which may be the administrator, promptly sends                                                      
18 notice of the service and a copy of the process, return receipt requested, to the                                       
19 defendant or respondent at the address set out in the consent to service of process or, if                              
20 a consent to service of process has not been filed, at the last known address, or takes                                 
21       other reasonable steps to give notice; and                                                                        
22 (2)  the plaintiff files an affidavit of compliance with this subsection in                                             
23 the action or proceeding on or before the return day of the process, if any, or within                                  
24 the time that the court, or the administrator in a proceeding before the administrator,                                 
25       allows.                                                                                                           
26 (d)  Service under (c) of this section may be used in a proceeding before the                                           
27 administrator or by the administrator in a civil action in which the administrator is the                               
28       moving party.                                                                                                     
29 (e)  If process is served under (c) of this section, the court, or the administrator                                    
30 in a proceeding before the administrator, shall order continuances as are necessary or                                  
31       appropriate to afford the defendant or respondent reasonable opportunity to defend.                               
01            Sec. 45.56.635. Applicability of the chapter. (a) Unless the persons are                                   
02       exempt elsewhere in this chapter, this chapter applies to persons who buy or offer to                             
03       buy when an offer to                                                                                              
04                 (1)  buy is made in this state; or                                                                      
05                 (2)  sell is made and accepted in this state.                                                           
06            (b)  Unless the person is exempt elsewhere in this chapter, this chapter applies                             
07       to a person who sells or offers to sell when an offer to                                                          
08                 (1)  sell is made in this state; or                                                                     
09                 (2)  buy is made and accepted in this state.                                                            
10 (c)  For the purpose of this section, an offer to sell or to buy is made in this                                        
11       state, whether or not either party is then present in this state, when the offer                                  
12                 (1)  originates from this state;                                                                        
13 (2)  is directed by the offeror to this state and received at the place to                                              
14       which it is directed or at a post office in this state in the case of a mailed offer;                             
15 (3)  is for an interest or participation in an oil, gas, or mining right, title,                                        
16 or lease on land in this state, including submerged land, regardless of where the offer                                 
17       is made;                                                                                                          
18 (4)  is for an interest or participation in payments out of production                                                  
19 under an oil, gas, or mining right, title, or lease on land in this state, including                                    
20       submerged land, regardless of where the offer is made;                                                            
21 (5)  is for an interest or participation in real property located in this                                               
22 state, or in a corporation, a partnership, a limited liability company, a limited                                       
23 partnership, a limited liability partnership, an association, or a joint-stock company;                                 
24 jurisdiction under this paragraph may be exercised only when the exercise is                                            
25       consistent with the constitution of this state or of the United States.                                           
26 (d)  For the purpose of this section, an offer to buy or to sell is accepted in this                                    
27 state when acceptance is communicated to the offeror in this state and has not                                          
28 previously been communicated to the offeror, orally or in writing, outside this state.                                  
29 Acceptance is communicated to the offeror in this state, whether or not either party is                                 
30 then present in this state, when the offeree directs the acceptance to the offeror in this                              
31 state reasonably believing the offeror to be in this state and the acceptance is received                               
01       at the place to which it is directed or, in the case of a mailed acceptance, at a post                            
02       office in this state.                                                                                             
03 (e)  This chapter applies to investment advisers, federal covered advisers, and                                         
04 investment adviser representatives when any act instrumental in effecting prohibited                                    
05 conduct is done in this state, regardless of whether either party is then present in this                               
06       state.                                                                                                            
07            Sec. 45.56.640. Regulations, forms, orders, interpretative opinions, and                                   
08       hearings. (a) The administrator may                                                                             
09                 (1)  issue forms and orders; after notice and comment, adopt and amend                                  
10 regulations necessary or appropriate to carry out this chapter; and repeal regulations,                                 
11 including regulations and forms governing registration statements, applications, notice                                 
12       filings, reports, and other records;                                                                              
13 (2)  by regulation, define terms, whether or not used in this chapter, but                                              
14       those definitions may not be inconsistent with this chapter; and                                                  
15 (3)  by regulation, classify securities, persons, and transactions and                                                  
16       adopt different requirements for different classes.                                                               
17 (b)  Under this chapter, a regulation or form may not be adopted or amended,                                            
18 or an order issued or amended, unless the administrator finds that the regulation, form,                                
19 order, or amendment is necessary or appropriate in the public interest or for the                                       
20 protection of investors and is consistent with the purposes intended by this chapter. In                                
21 adopting, amending, and repealing regulations and forms, AS 45.56.620 applies to                                        
22 achieve uniformity among the states and coordination with federal laws in the form                                      
23 and content of registration statements, applications, reports, and other records,                                       
24       including the adoption of uniform rules, forms, and procedures.                                                   
25 (c)  Subject to 15 U.S.C. 78o(i) and 80b-18a, the administrator may require                                             
26 that a financial statement filed under this chapter be prepared in accordance with                                      
27 generally accepted accounting principles in the United States and comply with other                                     
28 requirements specified by regulation adopted or order issued under this chapter. A                                      
29       regulation adopted or order issued under this chapter may establish                                               
30 (1)  subject to 15 U.S.C. 78o(i) and 80b-18a, the form and content of                                                   
31       financial statements required under this chapter;                                                                 
01                 (2)  whether unconsolidated financial statements must be filed; and                                     
02 (3)  whether required financial statements must be audited by an                                                        
03       independent certified public accountant.                                                                          
04 (d)  The administrator may provide interpretative opinions or issue                                                     
05 determinations that the administrator will not institute a proceeding or an action under                                
06 this chapter against a specified person for engaging in a specified act, practice, or                                   
07 course of business if the determination is consistent with this chapter. A regulation                                   
08 adopted or order issued under this chapter may establish a reasonable charge for                                        
09 interpretative opinions or determinations that the administrator will not institute an                                  
10       action or a proceeding under this chapter.                                                                        
11 (e)  A hearing in an administrative proceeding under this chapter shall be                                              
12 conducted in public unless the administrative law judge or the administrator for good                                   
13 cause consistent with this chapter determines that the hearing may not be conducted in                                  
14       public.                                                                                                           
15 (f)  AS 44.62 (Administrative Procedure Act) applies to all regulations adopted                                         
16       or authorized under this chapter.                                                                                 
17            Sec. 45.56.645. Investigations and subpoenas. (a) The administrator may                                    
18 (1)  conduct public or private investigations in or outside of this state                                               
19 that the administrator considers necessary or appropriate to determine whether a                                        
20 person has violated, is violating, or is about to violate this chapter or a regulation                                  
21 adopted or order issued under this chapter, or to aid in the enforcement of this chapter                                
22       or in the adoption of regulations and forms under this chapter;                                                   
23 (2)  require or permit a person to testify, file a statement, or produce a                                              
24 record, under oath or otherwise as the administrator determines, as to all the facts and                                
25 circumstances concerning a matter to be investigated or about which an action or                                        
26       proceeding is to be instituted; and                                                                               
27 (3)  publish a record concerning an action, proceeding, or an                                                           
28 investigation under, or a violation of, this chapter or a regulation adopted or order                                   
29 issued under this chapter if the administrator determines it is necessary or appropriate                                
30       in the public interest and for the protection of investors.                                                       
31 (b)  For the purpose of an investigation under this chapter, the administrator or                                       
01 the designated officer of the administrator may administer oaths and affirmations,                                      
02 subpoena witnesses, seek compulsion of attendance, take evidence, require the filing                                    
03 of statements, and require the production of any records that the administrator                                         
04       considers relevant or material to the investigation.                                                              
05 (c)  If a person does not appear or refuses to testify, file a statement, produce                                       
06 records, or otherwise obey a subpoena as required by the administrator under this                                       
07 chapter, the administrator may refer the matter to the attorney general, who may bring                                  
08 an action in the superior court or a court of another state to enforce compliance. The                                  
09       court may                                                                                                         
10                 (1)  hold the person in contempt;                                                                       
11                 (2)  order the person to appear before the administrator;                                               
12 (3)  order the person to testify about the matter under investigation or in                                             
13       question;                                                                                                         
14                 (4)  order the production of records;                                                                   
15 (5)  grant injunctive relief, including restricting or prohibiting the offer                                            
16       or sale of securities or the providing of investment advice;                                                      
17 (6)  impose a civil penalty of not more than $100,000 for a single                                                      
18       violation; and                                                                                                    
19                 (7)  grant any other necessary or appropriate relief.                                                   
20 (d)  This section does not preclude a person from applying to the superior court                                        
21 or a court of another state for relief from a request to appear, testify, file a statement,                             
22       produce records, or obey a subpoena.                                                                              
23 (e)  A person is not excused from attending, testifying, filing a statement,                                            
24 producing a record or other evidence, or obeying a subpoena of the administrator                                        
25 under this chapter or in an action or proceeding instituted by the administrator under                                  
26 this chapter on the ground that the required testimony, statement, record, or other                                     
27 evidence, directly or indirectly, may tend to incriminate the individual or subject the                                 
28 individual to a criminal fine, penalty, or forfeiture. If the person refuses to testify, file                           
29 a statement, or produce a record or other evidence based on the individual's privilege                                  
30 against self-incrimination, the administrator may apply to the superior court to compel                                 
31 the testimony, the filing of the statement, the production of the record, or the giving of                              
01 other evidence. The testimony, record, or other evidence compelled under an order of                                    
02 the superior court may not be used, directly or indirectly, against the individual in a                                 
03 criminal case, except in a prosecution for perjury, contempt, or otherwise failing to                                   
04       comply with the order.                                                                                            
05 (f)  At the request of the securities regulator of another state or a foreign                                           
06 jurisdiction, the administrator may provide assistance if the requesting regulator states                               
07 that it is conducting an investigation to determine whether a person has violated, is                                   
08 violating, or is about to violate a law or regulation of the other state or foreign                                     
09 jurisdiction relating to securities matters that the requesting regulator administers or                                
10 enforces. The administrator may provide the assistance by using the authority to                                        
11 investigate and the powers conferred by this section as the administrator determines is                                 
12 necessary or appropriate. The assistance may be provided without regard to whether                                      
13 the conduct described in the request would also constitute a violation of this chapter or                               
14 other law of this state if occurring in this state. In deciding whether to provide the                                  
15 assistance, the administrator may consider whether the requesting regulator is                                          
16 permitted and has agreed to provide assistance reciprocally within its state or foreign                                 
17 jurisdiction to the administrator on securities matters when requested, whether                                         
18 compliance with the request would violate or prejudice the public policy of this state,                                 
19 and the availability of resources and employees of the administrator to carry out the                                   
20       request for assistance.                                                                                           
21 Sec. 45.56.650. Administrative enforcement. (a) If the administrator                                                  
22 determines that a person has engaged, is engaging, or is about to engage in an act,                                     
23 practice, or course of business constituting a violation of this chapter or a regulation                                
24 adopted or order issued under this chapter or that a person has materially aided, is                                    
25 materially aiding, or is about to aid materially an act, practice, or course of business                                
26 constituting a violation of this chapter or a regulation adopted or order issued under                                  
27       this chapter, the administrator may issue an order                                                                
28 (1)  directing the person to cease and desist from engaging in the act,                                                 
29 practice, or course of business or to take other action necessary or appropriate to                                     
30       comply with this chapter;                                                                                         
31 (2)  denying, suspending, revoking, or conditioning the exemptions for                                                  
01 a broker-dealer under AS 45.56.405(b)(1)(D) or (F) or an investment adviser under                                       
02       AS 45.56.435(b)(1)(C); or                                                                                         
03 (3)  denying, suspending, conditioning, or limiting an exemption as                                                     
04       provided under AS 45.56.250.                                                                                      
05 (b)  An order under (a) of this section is effective on the date of issuance. Upon                                      
06 issuance of the order, the administrator shall promptly serve each person subject to the                                
07 order with a copy of the order and a notice that the order has been entered. The order                                  
08 must include a statement of any civil penalty, restitution, or costs of investigation the                               
09 administrator will seek, a statement of the reasons for the order, and notice that, within                              
10 15 days after receipt of a request in a record from the person, the matter will be                                      
11 scheduled for a hearing. If a person subject to the order does not request a hearing and                                
12 none is ordered by the administrator within 30 days after the date of service of the                                    
13 order, the order, including the imposition of a civil penalty, the imposition of                                        
14 restitution, or requirement for payment of the costs of investigation sought in a                                       
15 statement in the order, becomes final as to that person by operation of law. If a hearing                               
16 is requested or ordered, the administrator, after notice of and opportunity for hearing                                 
17 provided to each person subject to the order, may modify or vacate the order or extend                                  
18       it until final determination.                                                                                     
19 (c)  If a hearing is requested or ordered under (b) of this section, a hearing shall                                    
20 be conducted by the office of administrative hearings (AS 44.64.010), and                                               
21       AS 44.64.040 - 44.64.200 apply to and govern the hearing.                                                         
22 (d)  In a final order under (b) of this section, the administrator may impose a                                         
23 civil penalty of not more than $100,000 for a single violation, unless the violation of                                 
24 this chapter is against an older person or a vulnerable adult. In addition to a civil                                   
25 penalty imposed under this subsection, a person or entity who engages in conduct                                        
26 prohibited under this chapter against an older person or a vulnerable adult may be                                      
27 liable for an additional civil penalty of treble statutory damages. In determining                                      
28 whether to impose a supplemental civil penalty under this subsection, the                                               
29 administrator shall consider, in addition to other appropriate factors, the extent to                                   
30       which the following factors are present:                                                                          
31 (1)  whether the respondent knew that the respondent's conduct was                                                      
01       directed to an older person or a vulnerable adult;                                                                
02                 (2)  whether the respondent's conduct caused an older person or a                                       
03       vulnerable adult to suffer                                                                                        
04                      (A)  severe loss or encumbrance of a primary residence,                                            
05            principal employment, or source of income; or                                                                
06                      (B)  substantial loss of property set aside for retirement or for                                  
07            personal and family care and maintenance; or                                                                 
08                 (3)  whether the respondent's conduct caused substantial loss of                                        
09       payments received under a pension or retirement plan or a government benefits                                     
10       program.                                                                                                          
11            (e)  In a final order under (b) of this section, the administrator may                                       
12 (1)  impose restitution to any person in interest for any money or                                                      
13 property, real or personal, that may have been acquired or transferred in violation of                                  
14       this chapter;                                                                                                     
15 (2)  charge the actual cost of an investigation or proceeding for a                                                     
16       violation of this chapter or a regulation adopted or order issued under this chapter; and                         
17 (3)  deny the violator of the use of any exemptions listed under this                                                   
18       chapter.                                                                                                          
19 (f)  The administrator may petition the superior court to enter a judgment                                              
20 against a person who is a respondent in the order for the amount of the civil penalty                                   
21 levied against the person. Subject to AS 44.62.570, the filing of the petition for a                                    
22 judgment does not reopen the final order to further substantive review. A judgment                                      
23 entered under this subsection may be executed on and levied under in the manner                                         
24       provided in AS 09.35.                                                                                             
25 (g)  If a person does not comply with an order under this section, the                                                  
26 administrator may petition a court of competent jurisdiction to enforce the order. The                                  
27 court may not require the administrator to post a bond in an action or proceeding under                                 
28 this section. If the court finds, after service and opportunity for hearing, that the person                            
29 was not in compliance with the order, the court may adjudge the person in civil                                         
30 contempt of the order. The court may impose a further civil penalty against the person                                  
31 for contempt in an amount not less than $5,000 but not greater than $100,000 for each                                   
01 violation and may grant any other relief the court determines is just and proper in the                                 
02       circumstances.                                                                                                    
03 Sec. 45.56.655. Civil enforcement. (a) If the administrator believes that a                                           
04 person has engaged, is engaging, or is about to engage in an act, practice, or course of                                
05 business constituting a violation of this chapter or a regulation adopted or order issued                               
06 under this chapter, or that a person has engaged, is engaging, or is about to engage in                                 
07 an act, practice, or course of business that materially aids a violation of this chapter or                             
08 a regulation adopted or order issued under this chapter, the administrator may maintain                                 
09 an action in the superior court to enjoin the act, practice, or course of business and to                               
10 enforce compliance with this chapter or a regulation adopted or order issued under this                                 
11       chapter.                                                                                                          
12            (b)  In an action under this section and on a proper showing, the court may                                  
13 (1)  issue a permanent or temporary injunction, restraining order, or                                                   
14       declaratory judgment;                                                                                             
15                 (2)  order other appropriate or ancillary relief, which may include                                     
16 (A)  an asset freeze, accounting, writ of attachment, writ of                                                           
17 general or specific execution, and appointment of a receiver or conservator that                                        
18            may be the administrator for the defendant or the defendant's assets;                                        
19 (B)  ordering the administrator to take charge and control of a                                                         
20 defendant's property, including investment accounts and accounts in a                                                   
21 depository institution, rents, and profits; to collect debts; and to acquire and                                        
22            dispose of property;                                                                                         
23 (C)  imposing a civil penalty of not more than $100,000 for a                                                           
24 single violation, unless the violation of this chapter is against an older person                                       
25 or a vulnerable adult; in determining whether to impose a supplemental civil                                            
26 penalty for a violation of this chapter against an older person or a vulnerable                                         
27 adult, the court shall consider, in addition to other appropriate factors, the                                          
28            extent to which the following factors are present:                                                           
29 (i)  whether the respondent knew that the respondent's                                                                  
30                 conduct was directed to an older person or a vulnerable adult;                                          
31 (ii)  whether the respondent's conduct caused an older                                                                  
01 person or a vulnerable adult to suffer severe loss or encumbrance of a                                                  
02 primary residence, principal employment, or source of income; or                                                        
03 substantial loss of property set aside for retirement or for personal and                                               
04                 family care and maintenance; or                                                                         
05 (iii)  whether the respondent's conduct caused                                                                          
06 substantial loss of payments received under a pension or retirement                                                     
07                 plan or a government benefits program;                                                                  
08 (D)  imposing an order of rescission, or disgorgement directed                                                          
09 to a person that has engaged in an act, practice, or course of business                                                 
10 constituting a violation of this chapter or former AS 45.55 or a regulation                                             
11            adopted or order issued under this chapter or former AS 45.55;                                               
12 (E)  imposing an order of restitution to any person in interest for                                                     
13 any money or property, real or personal, that may have been acquired or                                                 
14            transferred in violation of this chapter; and                                                                
15 (F)  ordering the payment of prejudgment and post judgment                                                              
16            interest; or                                                                                                 
17                 (3)  order other relief that the court considers appropriate.                                           
18 (c)  The administrator may not be required to post a bond in an action or                                               
19       proceeding under this chapter.                                                                                    
20 (d)  After an order issued by the court under (b) of this section becomes final                                         
21 and all rights of appeal are exhausted, the administrator may petition the superior court                               
22 to enter a judgment against a person who is a respondent in the order for the amount of                                 
23 the civil penalty levied against the person. Subject to AS 44.62.570, the filing of the                                 
24 petition for a judgment does not reopen the final order to further substantive review. A                                
25 judgment entered under this subsection may be executed on and levied under in the                                       
26       manner provided in AS 09.35.                                                                                      
27 Sec. 45.56.660. Civil liability. (a) Enforcement of civil liability under this                                        
28 section is subject to P.L. 105-353 (Securities Litigation Uniform Standards Act of                                      
29       1998).                                                                                                            
30 (b)  A person is liable to the purchaser if the person sells a security in violation                                    
31 of AS 45.56.105, or by means of an untrue statement of a material fact or an omission                                   
01 to state a material fact necessary to make the statement made, in light of the                                          
02 circumstances under which it is made, not misleading, the purchaser not knowing the                                     
03 untruth or omission and the seller not sustaining the burden of proof that the seller did                               
04 not know and, in the exercise of reasonable care, could not have known of the untruth                                   
05       or omission. An action under this subsection is governed by the following:                                        
06 (1)  the purchaser may maintain an action to recover the consideration                                                  
07 paid for the security, less the amount of any income received on the security, and                                      
08 interest at the legal rate of interest under AS 09.30.070, or eight percent a year,                                     
09 whichever is greater, from the date of the purchase, costs, and attorney fees as                                        
10 determined by the court, upon the tender of the security, or for actual damages as                                      
11       provided in (3) of this subsection;                                                                               
12 (2)  the tender referred to in (1) of this subsection may be made any                                                   
13 time before entry of judgment; tender requires only notice in a record of ownership of                                  
14 the security and willingness to exchange the security for the amount specified; a                                       
15 purchaser that no longer owns the security may recover actual damages as provided in                                    
16       (3) of this subsection;                                                                                           
17 (3)  actual damages in an action arising under this subsection are the                                                  
18 amount that would be recoverable upon a tender less the value of the security when the                                  
19 purchaser disposed of it, and interest at the legal rate of interest under AS 09.30.070,                                
20 or eight percent a year, whichever is greater, from the date of the purchase, costs, and                                
21       attorney fees as determined by the court.                                                                         
22 (c)  A person is liable to the seller if the person buys a security by means of an                                      
23 untrue statement of a material fact or omission to state a material fact necessary to                                   
24 make the statement made, in light of the circumstances under which it is made, not                                      
25 misleading, the seller not knowing of the untruth or omission, and the purchaser not                                    
26 sustaining the burden of proof that the purchaser did not know and, in the exercise of                                  
27 reasonable care, could not have known of the untruth or omission. An action under                                       
28       this subsection is governed by the following:                                                                     
29 (1)  the seller may maintain an action to recover the security and any                                                  
30 income received on the security, costs, and attorney fees as determined by the court,                                   
31 upon the tender of the purchase price, or for actual damages as provided in (3) of this                                 
01       subsection;                                                                                                       
02 (2)  the tender referred to in (1) of this subsection may be made any                                                   
03 time before entry of judgment; tender requires only notice in a record of the present                                   
04 ability to pay the amount tendered and willingness to take delivery of the security for                                 
05 the amount specified; if the purchaser no longer owns the security, the seller may                                      
06       recover actual damages as provided in (3) of this subsection;                                                     
07 (3)  actual damages in an action arising under this subsection are the                                                  
08 difference between the price at which the security was sold and the value the security                                  
09 would have had at the time of the sale in the absence of the purchaser's conduct                                        
10 causing liability, and interest at the legal rate of interest under AS 09.30.070, or eight                              
11 percent a year, whichever is greater, from the date of the sale of the security, costs,                                 
12       and attorney fees as determined by the court.                                                                     
13 (d)  A person acting as a broker-dealer or agent that sells or buys a security in                                       
14 violation of AS 45.56.405(a), 45.56.435(a), or 45.56.530 is liable to the customer. The                                 
15 customer, if a purchaser, may maintain an action for recovery of actual damages as                                      
16 specified in (b)(1) - (3) of this section or, if a seller, for a remedy as specified in (c)(1)                          
17       - (3) of this section.                                                                                            
18 (e)  A person acting as an investment adviser or investment adviser                                                     
19 representative that provides investment advice for compensation in violation of                                         
20 AS 45.56.435(a), 45.56.440(a), or 45.56.530 is liable to the client. The client may                                     
21 maintain an action to recover the consideration paid for the advice, interest at the legal                              
22 rate of interest under AS 09.30.070, or eight percent a year, whichever is greater, from                                
23       the date of payment, costs, and attorney fees as determined by the court.                                         
24 (f)  A person that receives, directly or indirectly, any consideration for                                              
25 providing investment advice to another person and that employs a device, scheme, or                                     
26 artifice to defraud the other person or engages in an act, practice, or course of business                              
27 that operates or would operate as a fraud or deceit on the other person is liable to the                                
28       other person. An action under this subsection is governed by the following:                                       
29 (1)  the person defrauded may maintain an action to recover the                                                         
30 consideration paid for the advice and the amount of any actual damages caused by the                                    
31 fraudulent conduct, interest at the legal rate of interest under AS 09.30.070, or eight                                 
01       percent a year, whichever is greater, from the date of the fraudulent conduct, costs,                             
02       and reasonable attorney fees as determined by the court, less the amount of any                                   
03       income received as a result of the fraudulent conduct;                                                            
04                 (2)  this subsection does not apply to a broker-dealer or its agents if the                             
05       investment advice provided is solely incidental to transacting business as a broker-                              
06       dealer and special compensation is not received for the investment advice.                                        
07            (g)  The following persons are liable jointly and severally with and to the same                             
08       extent as persons liable under (b) - (f) of this section:                                                         
09                 (1)  a person that directly or indirectly controls a person liable under (b)                            
10 - (f) of this section, unless the controlling person sustains the burden of proof that the                              
11 person did not know and, in the exercise of reasonable care, could not have known of                                    
12       the existence of conduct because of which the liability is alleged to exist;                                      
13 (2)  an individual who is a managing partner, executive officer, or                                                     
14 director of a person liable under (b) - (f) of this section, including an individual having                             
15 a similar status or performing similar functions, unless the individual sustains the                                    
16 burden of proof that the individual did not know and, in the exercise of reasonable                                     
17 care, could not have known of the existence of conduct because of which the liability                                   
18       is alleged to exist;                                                                                              
19 (3)  an individual who is an employee of or associated with a person                                                    
20 liable under (b) - (f) of this section and who materially aids the conduct giving rise to                               
21 the liability, unless the individual sustains the burden of proof that the individual did                               
22 not know and, in the exercise of reasonable care, could not have known of the                                           
23       existence of conduct because of which the liability is alleged to exist; and                                      
24 (4)  a person that is a broker-dealer, agent, investment adviser, or                                                    
25 investment adviser representative that materially aids the conduct giving rise to the                                   
26 liability under (b) - (f) of this section, unless the person sustains the burden of proof                               
27 that the person did not know and, in the exercise of reasonable care, could not have                                    
28       known of the existence of conduct because of which the liability is alleged to exist.                             
29 (h)  A person liable under this section has a right of contribution as in cases of                                      
30       contract against any other person liable under this section for the same conduct.                                 
31 (i)  A cause of action under this section survives the death of an individual who                                       
01       might have been a plaintiff or defendant.                                                                         
02            (j)  A person may not obtain relief under (b) of this section                                                
03                 (1)  for a violation of AS 45.56.105, or under (d) or (e) of this section,                              
04       unless the action is instituted within three years after the violation occurred; or                               
05                 (2)  other than for a violation of AS 45.56.105, or under (c) or (f) of this                            
06       section, unless the action is instituted within the earlier of two years after discovery of                       
07       the facts constituting the violation or five years after the violation.                                           
08            (k)  A person that has made, or has engaged in the performance of, a contract                                
09       in violation of this chapter or a regulation adopted or order issued under this chapter or                        
10 that has acquired a purported right under the contract with knowledge of conduct                                        
11 because of which its making or performance was in violation of this chapter may not                                     
12       base an action on the contract.                                                                                   
13 (l)  A condition, stipulation, or provision binding a person purchasing or                                              
14 selling a security or receiving investment advice to waive compliance with this chapter                                 
15       or a regulation adopted or order issued under this chapter is void.                                               
16 (m)  The rights and remedies provided by this chapter are in addition to any                                            
17 other rights or remedies that may exist, but this chapter does not create a cause of                                    
18       action not specified in this section or AS 45.56.475(e).                                                          
19 Sec. 45.56.665. Rescission offers. (a) A purchaser, seller, or recipient of                                           
20       investment advice may not maintain an action under AS 45.56.660 if                                                
21 (1)  the purchaser, seller, or recipient of investment advice receives, in                                              
22       a record, before the action is instituted,                                                                        
23 (A)  an offer stating the respect in which liability under                                                              
24 AS 45.56.660 may have arisen and fairly advising the purchaser, seller, or                                              
25 recipient of investment advice of that person's rights in connection with the                                           
26 offer and any financial or other information necessary to correct all material                                          
27 misrepresentations or omissions in the information that was required by this                                            
28 chapter to be furnished to that person at the time of the purchase, sale, or                                            
29            investment advice;                                                                                           
30 (B)  if the basis for relief under this section may have been a                                                         
31 violation of AS 45.56.660(b), an offer to repurchase the security for cash,                                             
01 payable on delivery of the security, equal to the consideration paid, and interest                                      
02 at the legal rate of interest under AS 09.30.070, or eight percent a year,                                              
03 whichever is greater, from the date of the purchase, less the amount of any                                             
04 income received on the security, or, if the purchaser no longer owns the                                                
05 security, an offer to pay the purchaser, upon acceptance of the offer, damages                                          
06 in an amount that would be recoverable upon a tender, less the value of the                                             
07 security when the purchaser disposed of it, and interest at the legal rate of                                           
08 interest under AS 09.30.070, or eight percent a year, whichever is greater, from                                        
09 the date of the purchase in cash equal to the damages computed in the manner                                            
10            provided in this subparagraph;                                                                               
11 (C)  if the basis for relief under this section may have been a                                                         
12 violation of AS 45.56.660(c), an offer to tender the security, on payment by the                                        
13 seller of an amount equal to the purchase price paid, less income received on                                           
14 the security by the purchaser and interest at the legal rate of interest under                                          
15 AS 09.30.070, or eight percent a year, whichever is greater, from the date of                                           
16 the sale, or, if the purchaser no longer owns the security, an offer to pay the                                         
17 seller, upon acceptance of the offer, in cash, damages in the amount of the                                             
18 difference between the price at which the security was purchased and the value                                          
19 the security would have had at the time of the purchase in the absence of the                                           
20 purchaser's conduct that may have caused liability and interest at the legal rate                                       
21 of interest in AS 09.30.070, or eight percent a year, whichever is greater, from                                        
22            the date of the sale;                                                                                        
23 (D)  if the basis for relief under this section may have been a                                                         
24 violation of AS 45.56.660(d); and if the customer is a purchaser, an offer to                                           
25 pay as specified in (B) of this paragraph; or, if the customer is a seller, an offer                                    
26            to tender or to pay as specified in (C) of this paragraph;                                                   
27 (E)  if the basis for relief under this section may have been a                                                         
28 violation of AS 45.56.660(e), an offer to reimburse in cash the consideration                                           
29 paid for the advice and interest at the legal rate of interest under AS 09.30.070,                                      
30            or eight percent a year, whichever is greater, from the date of payment; or                                  
31 (F)  if the basis for relief under this section may have been a                                                         
01 violation of AS 45.56.660(f), an offer to reimburse in cash the consideration                                           
02 paid for the advice, the amount of any actual damages that may have been                                                
03 caused by the conduct, and interest at the legal rate of interest under                                                 
04 AS 09.30.070, or eight percent a year, whichever is greater, from the date of                                           
05            the violation causing the loss;                                                                              
06 (2)  the offer under (1) of this subsection states that it must be accepted                                             
07 by the purchaser, seller, or recipient of investment advice within 30 days after the date                               
08 of its receipt by the purchaser, seller, or recipient of investment advice or any shorter                               
09       period of not less than three days that the administrator, by order, specifies;                                   
10 (3)  the offeror has the present ability to pay the amount offered or to                                                
11       tender the security under (1) of this subsection;                                                                 
12 (4)  the offer under (1) of this subsection is delivered to the purchaser,                                              
13 seller, or recipient of investment advice or sent in a manner that ensures receipt by the                               
14       purchaser, seller, or recipient of investment advice; and                                                         
15 (5)  the purchaser, seller, or recipient of investment advice that accepts                                              
16 the offer under (1) of this subsection, in a record, within the period specified under (2)                              
17       of this subsection, is paid in accordance with the terms of the offer.                                            
18 (b)  The offer under this section shall be filed with the administrator 10                                              
19 business days before the offering and conform in form and content with a regulation                                     
20       adopted under this chapter.                                                                                       
21 Sec. 45.56.670. Criminal enforcement. (a) A person who intentionally                                                  
22 violates this chapter, except AS 45.56.550 or the notice filing requirements of                                         
23 AS 45.56.330 or 45.56.445, is guilty of a class C felony punishable by imprisonment                                     
24       under AS 12.55.125 or by a fine of not more than $100,000, or by both.                                            
25 (b)  A person who intentionally alters, destroys, shreds, mutilates, or conceals a                                      
26 record, document, or other object, or attempts to do so, with the intent to alter or                                    
27 impair the record, document, or object for use in an official proceeding under this                                     
28 chapter, is guilty of a class C felony. A person convicted of violating this subsection is                              
29 punishable by imprisonment as provided in AS 12.55.125, by a fine of not more than                                      
30       $500,000, or by both.                                                                                             
31 (c)  The attorney general, with or without a reference from the administrator,                                          
01       may institute criminal proceedings under this chapter.                                                            
02            (d)  This chapter does not limit the power of this state to punish a person for                              
03       conduct that constitutes a crime under other laws of this state.                                                  
04            (e)  In this section, "intentionally" has the meaning given in AS 11.81.900(a).                              
05 Sec. 45.56.675. Judicial review. (a) A person may obtain judicial review by                                           
06 the superior court of a final order issued by the administrator under this chapter by                                   
07 filing a notice of appeal in accordance with the applicable rules of court governing                                    
08 appeals in civil matters. The notice of appeal shall be filed within 30 days after the                                  
09       order becomes final under AS 44.64.060.                                                                           
10 (b)  A regulation adopted under this chapter is subject to judicial review under                                        
11       AS 44.62.300.                                                                                                     
12            Article 7. Miscellaneous and Additional General Provisions.                                                
13 Sec. 45.56.710. Reimbursement of expenses incident to examination or                                                  
14 investigation. (a) The administrator may require an issuer, broker-dealer, agent,                                     
15 investment adviser representative, federal covered adviser, or investment adviser to                                    
16 reimburse the administrator for actual travel expenses and per diem incurred in                                         
17       connection with an examination or investigation under this chapter.                                               
18 (b)  The administrator may by regulation or order adopt a schedule of charges                                           
19 for examination and investigation of issuers, broker-dealers, agents, investment                                        
20       adviser representatives, federal covered advisers, and investment advisers.                                       
21 (c)  If an issuer, broker-dealer, agent, investment adviser representative, federal                                     
22 covered adviser, or investment adviser fails to pay the fees and expenses provided for                                  
23 in this section, the fees and expenses shall be paid out of funds of the administrator in                               
24 the same manner as other disbursements made by the administrator. The amounts paid                                      
25 from the funds of the administrator are a lien on all of the assets and property of the                                 
26 issuer, broker-dealer, agent, investment adviser representative, federal covered                                        
27 adviser, or investment adviser, and the amount may be recovered by the attorney                                         
28       general on behalf of this state.                                                                                  
29 (d)  Failure of the issuer, broker-dealer, agent, investment adviser                                                    
30 representative, federal covered adviser, or investment adviser to pay fees and expenses                                 
31 under this section is a willful violation of this chapter, and the violation falls within                               
01       the provisions of AS 45.56.350, 45.56.440, and 45.56.615.                                                         
02 Sec. 45.56.720. Electronic records and signatures. This chapter modifies,                                             
03 limits, and supersedes 15 U.S.C. 7001 - 7031 (Electronic Signatures in Global and                                       
04 National Commerce Act), but does not modify, limit, or supersede 15 U.S.C. 7001(c)                                      
05 or authorize electronic delivery of any of the notices described in 15 U.S.C. 7003(b).                                  
06 This chapter authorizes the filing of records and signatures, when specified by                                         
07 provisions of this chapter or by a regulation adopted or order issued under this chapter,                               
08       in a manner consistent with 15 U.S.C. 7004(a).                                                                    
09 Sec. 45.56.730. References to federal statutes. In this chapter, a reference to                                       
10 the following federal statutes, including a statute within a spanned reference, means                                   
11 those statutes and the rules and regulations adopted under those statutes, as in effect on                              
12       the date of enactment of this chapter:                                                                            
13                 (1)  7 U.S.C. 1 - 27 (Commodity Exchange Act);                                                          
14                 (2)  15 U.S.C. 77a - 77aa (Securities Act of 1933);                                                     
15 (3)  15 U.S.C. 77b, 77k, 77m, 77p, 77r, 77v, 77z-1 - 77z-3, 77aa,                                                       
16 77ccc, 77ddd, 77mmm, 77sss, 78a, 78c, 78d, 78g, 78n, 78o, 78o-4, 78o-5, 78s, 78t,                                       
17 78u, 78u-4, 78z, 78bb, 78ee, 78kk, 78ll, 80a-2, 80a-3, 80a-12, 80a-18, 80a-29, 80a-30,                                  
18       80b-3, and 80b-18a (Securities Litigation Uniform Standards Act of 1998);                                         
19                 (4)  15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934);                                            
20                 (5)  15 U.S.C. 80a-1 - 80a-64 (Investment Company Act of 1940);                                         
21                 (6)  15 U.S.C. 80b-1 - 80b-21 (Investment Advisers Act of 1940);                                        
22                 (7)  15 U.S.C. 661 - 697g (Small Business Investment Act of 1958);                                      
23 (8)  15 U.S.C. 7001 - 7031 (Electronic Signatures in Global and                                                         
24       National Commerce Act);                                                                                           
25                 (9)  26 U.S.C. (Internal Revenue Code);                                                                 
26 (10)  29 U.S.C. 1001 - 1461 (Employee Retirement Income Security                                                        
27       Act of 1974);                                                                                                     
28                 (11)  42 U.S.C. 16451 - 16481 (Energy Policy Act of 2005).                                              
29 Sec. 45.56.740. References to federal agencies. A reference in this chapter to                                        
30 an agency or department of the United States is also a reference to a successor agency                                  
31       or department.                                                                                                    
01 Sec. 45.56.900. Definitions. In this chapter, unless the context otherwise                                            
02       requires,                                                                                                         
03 (1)  "administrator" means the commissioner of commerce, community,                                                     
04       and economic development or a designee of the commissioner;                                                       
05 (2)  "agent" means an individual, other than a broker-dealer, who                                                       
06 represents a broker-dealer in effecting or attempting to effect purchases or sales of                                   
07 securities or represents an issuer in effecting or attempting to effect purchases or sales                              
08 of the issuer's securities; however, a partner, officer, or director of a broker-dealer or                              
09 issuer, or an individual having a similar status or performing similar functions is an                                  
10 agent only if the individual otherwise comes within the term; "agent" does not include                                  
11       an individual excluded by a regulation adopted or order issued under this chapter;                                
12                 (3)  "bank" means                                                                                       
13 (A)  a banking institution organized under the laws of the                                                              
14            United States;                                                                                               
15                      (B)  a member bank of the Federal Reserve System;                                                  
16 (C)  any other banking institution, whether incorporated or not,                                                        
17 doing business under the laws of a state or of the United States, a substantial                                         
18 portion of the business of which consists of receiving deposits or exercising                                           
19 fiduciary powers similar to those permitted to be exercised by national banks                                           
20 under the authority of the United States Comptroller of the Currency under 12                                           
21 U.S.C. 92a, that is supervised and examined by a state or federal agency                                                
22 having supervision over banks, and that is not operated for the purpose of                                              
23            evading this chapter; and                                                                                    
24 (D)  a receiver, conservator, or other liquidating agent of any                                                         
25            institution or firm included in (A), (B), or (C) of this paragraph;                                          
26 (4)  "broker-dealer" means a person engaged in the business of                                                          
27 effecting transactions in securities for the accounts of others or for the person's own                                 
28       account; "broker-dealer" does not include                                                                         
29                      (A)  an agent;                                                                                     
30                      (B)  an issuer;                                                                                    
31 (C)  a bank, trust company organized or chartered under the                                                             
01 laws of this state, or savings institution if its activities as a broker-dealer are                                     
02 limited to those specified in 15 U.S.C. 78c(a)(4)(B)(i) - (vi), (viii) - (x), and                                       
03 (xi) if limited to unsolicited transactions, or 15 U.S.C. 78c(a)(5)(B) and (C), or                                      
04            a bank that satisfies the conditions described in 15 U.S.C. 78c(a)(4);                                       
05                      (D)  an international banking institution; or                                                      
06                      (E)  a person excluded by a regulation adopted or order issued                                     
07            under this chapter;                                                                                          
08                 (5)  "defraud" includes engaging in common law deceit;                                                  
09                 (6)  "department" means the Department of Commerce, Community,                                          
10       and Economic Development;                                                                                         
11                 (7)  "depository institution" means                                                                     
12                      (A)  a bank; or                                                                                    
13 (B)  a savings institution, trust company, credit union, or similar                                                     
14 institution that is organized or chartered under the laws of a state or of the                                          
15 United States, authorized to receive deposits and supervised and examined by                                            
16 an official or agency of a state or the United States if its deposits or share                                          
17 accounts are insured to the maximum amount authorized by statute by the                                                 
18 Federal Deposit Insurance Corporation, the National Credit Union Share                                                  
19 Insurance Fund, or a successor authorized by federal law; "depository                                                   
20            institution" does not include                                                                                
21 (i)  an insurance company or other organization                                                                         
22                 primarily engaged in the business of insurance;                                                         
23                           (ii)  a Morris Plan bank; or                                                                  
24 (iii)  an industrial loan company that is not an "insured                                                               
25 depository institution" as defined in 12 U.S.C. 1813(c)(2) (Federal                                                     
26                 Deposit Insurance Act), or any successor federal statute;                                               
27 (8)  "federal covered investment adviser" means a person registered                                                     
28       under 15 U.S.C. 80b-1 - 80b-21 (Investment Advisers Act of 1940);                                                 
29 (9)  "federal covered security" means a security that is, or upon                                                       
30 completion of a transaction will be, a covered security under 15 U.S.C. 77r(b)                                          
31       (Securities Act of 1933) or rules or regulations adopted under that provision;                                    
01                 (10)  "filing" means the receipt under this chapter of a record by the                                  
02       administrator or a designee of the administrator;                                                                 
03                 (11)  "former AS 45.55" means AS 45.55 as the provisions under that                                     
04       chapter read on the day before the effective date of this section;                                                
05                 (12)  "fraud" and "deceit" include common law deceit;                                                   
06                 (13)  "guaranteed" means guaranteed as to payment of all principal and                                  
07       all interest;                                                                                                     
08                 (14)  "institutional investor" means any of the following, whether                                      
09       acting for itself or for others in a fiduciary capacity:                                                          
10 (A)  a depository institution, a trust company organized or                                                             
11            chartered under the laws of this state, or an international banking institution;                             
12                      (B)  an insurance company;                                                                         
13                      (C)  a separate account of an insurance company;                                                   
14 (D)  an investment company as defined in 15 U.S.C. 80a-1 -                                                              
15            80a-64 (Investment Company Act of 1940);                                                                     
16 (E)  a broker-dealer registered under 15 U.S.C. 78a  78pp                                                              
17            (Securities Exchange Act of 1934);                                                                           
18 (F)  an employee pension, profit-sharing, or benefit plan if the                                                        
19 plan has total assets in excess of $10,000,000 or its investment decisions are                                          
20 made by a named fiduciary, as defined in 29 U.S.C. 1102(a)(2) (Employee                                                 
21 Retirement Income Security Act of 1974), that is a broker-dealer registered                                             
22 under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934), an investment                                             
23 adviser registered or exempt from registration under 15 U.S.C. 80b-1 - 80b-21                                           
24 (Investment Advisers Act of 1940), an investment adviser registered under this                                          
25            chapter, a depository institution, or an insurance company;                                                  
26 (G)  a plan established and maintained by a state, a political                                                          
27 subdivision of a state, or an agency or instrumentality of a state or a political                                       
28 subdivision of a state for the benefit of its employees if the plan has total assets                                    
29 in excess of $10,000,000 or its investment decisions are made by a legally                                              
30 designated public official or by a named fiduciary, as defined in 29 U.S.C.                                             
31 1102(a)(2) (Employee Retirement Income Security Act of 1974), that is a                                                 
01 broker-dealer registered under 15 U.S.C. 78a - 78pp (Securities Exchange Act                                            
02 of 1934), an investment adviser registered or exempt from registration under                                            
03 15 U.S.C. 80b-1 - 80b-21 (Investment Advisers Act of 1940), an investment                                               
04 adviser registered under this chapter, a depository institution, or an insurance                                        
05            company;                                                                                                     
06 (H)  a trust if that trust has total assets in excess of $10,000,000,                                                   
07 the trustee of the trust is a depository institution, and the participants in the                                       
08 trust are exclusively plans of the types identified in (F) or (G) of this                                               
09 paragraph, regardless of the size of their assets, except a trust that includes as                                      
10 participants self-directed individual retirement accounts or similar self-directed                                      
11            plans;                                                                                                       
12 (I)  an organization described in 26 U.S.C. 501(c)(3) (Internal                                                         
13 Revenue Code), corporation, Massachusetts trust or similar business trust,                                              
14 limited liability company, or partnership, not formed for the specific purpose                                          
15            of acquiring the securities offered, with total assets in excess of $10,000,000;                             
16 (J)  a small business investment company licensed by the                                                                
17 United States Small Business Administration under 15 U.S.C. 681(c) (Small                                               
18            Business Investment Act of 1958) with total assets in excess of $10,000,000;                                 
19 (K)  a private business development company as defined in 15                                                            
20 U.S.C. 80b-2(a)(22) (Investment Advisers Act of 1940) with total assets in                                              
21            excess of $10,000,000;                                                                                       
22 (L)  a federal covered investment adviser acting for its own                                                            
23            account;                                                                                                     
24 (M)  a qualified institutional buyer, as defined in 17 C.F.R.                                                           
25 230.144A, other than 17 C.F.R. 230.144A(a)(1)(i)(H), adopted under 15                                                   
26            U.S.C. 77a - 77aa (Securities Act of 1933);                                                                  
27 (N)  a major United States institutional investor, as defined in                                                        
28 17 C.F.R. 240.15a-6(b)(4)(i), adopted under 15 U.S.C. 78a - 78pp (Securities                                            
29            Exchange Act of 1934);                                                                                       
30 (O)  any other person, other than an individual, of institutional                                                       
31 character with total assets in excess of $10,000,000 not organized for the                                              
01            specific purpose of evading this chapter; or                                                                 
02                      (P)  any other person specified by regulation adopted or order                                     
03            issued under this chapter;                                                                                   
04 (15)  "insurance company" means a company organized as an insurance                                                     
05 company whose primary business is writing insurance or reinsuring risks underwritten                                    
06 by insurance companies and that is subject to supervision by the insurance                                              
07       commissioner or a similar official or agency of a state;                                                          
08                 (16)  "insured" means insured as to payment of all principal and all                                    
09       interest;                                                                                                         
10 (17)  "international banking institution" means an international                                                        
11 financial institution of which the United States is a member and whose securities are                                   
12       exempt from registration under 15 U.S.C. 77a - 77aa (Securities Act of 1933);                                     
13 (18)  "investment adviser" means a person that, for compensation,                                                       
14 engages in the business of advising others, either directly or through publications or                                  
15 writings, as to the value of securities or the advisability of investing in, purchasing, or                             
16 selling securities or that, for compensation and as a part of a regular business, issues or                             
17 produces analyses or reports concerning securities; "investment adviser" includes a                                     
18 financial planner or other person that, as an integral component of other financially                                   
19 related services, provides investment advice to others for compensation as part of a                                    
20 business or that holds itself out as providing investment advice to others for                                          
21       compensation; "investment adviser" does not include                                                               
22                      (A)  an investment adviser representative;                                                         
23 (B)  a lawyer, accountant, engineer, or teacher whose                                                                   
24 performance of investment advice is solely incidental to the practice of the                                            
25            person's profession;                                                                                         
26 (C)  a broker-dealer or its agents whose performance of                                                                 
27 investment advice is solely incidental to the conduct of business as a broker-                                          
28 dealer and that does not receive special compensation for the investment                                                
29            advice;                                                                                                      
30 (D)  a publisher of a bona fide newspaper, news magazine, or                                                            
31            business or financial publication of general and regular circulation;                                        
01                      (E)  a federal covered investment adviser;                                                         
02                      (F)  a bank, a trust company organized or chartered under the                                      
03            laws of this state, or a savings institution;                                                                
04                      (G)  any other person that is excluded by 15 U.S.C. 80b-1 - 80b-                                   
05            21 (Investment Advisers Act of 1940) from the definition of investment                                       
06            adviser; or                                                                                                  
07                      (H)  any other person excluded by a regulation adopted or order                                    
08            issued under this chapter;                                                                                   
09                 (19)  "investment adviser representative" means an individual                                           
10 employed by or associated with an investment adviser or federal covered investment                                      
11 adviser and who makes any recommendations or otherwise gives investment advice                                          
12 regarding securities, manages accounts or portfolios of clients, determines which                                       
13 recommendation or advice regarding securities should be given, provides investment                                      
14 advice or offers to provide investment advice, receives compensation to solicit, offer,                                 
15 or negotiate for the sale of or for selling investment advice, or supervises employees                                  
16 who perform any of the foregoing; "investment adviser representative" does not                                          
17       include an individual who                                                                                         
18                      (A)  performs only clerical or ministerial acts;                                                   
19 (B)  is an agent whose performance of investment advice is                                                              
20 solely incidental to the individual's acting as an agent and who does not receive                                       
21            special compensation for investment advisory services;                                                       
22 (C)  is employed by or associated with a federal covered                                                                
23 investment adviser, unless the individual has a place of business in this state, as                                     
24 that term is defined by rule adopted under 15 U.S.C. 80b-3a (Investment                                                 
25            Advisers Act of 1940) and is                                                                                 
26 (i)  an investment adviser representative, as that term is                                                              
27 defined by rule adopted under 15 U.S.C. 80b-3a (Investment Advisers                                                     
28                 Act of 1940); or                                                                                        
29 (ii)  not a supervised person, as that term is defined in 15                                                            
30                 U.S.C. 80b-2(a)(25) (Investment Advisers Act of 1940); or                                               
31 (D)  is excluded by a regulation adopted or order issued under                                                          
01            this chapter;                                                                                                
02                 (20)  "issuer" means a person that issues or proposes to issue a security,                              
03       subject to the following:                                                                                         
04 (A)  the issuer of a voting trust certificate, collateral trust                                                         
05 certificate, certificate of deposit for a security, or share in an investment                                           
06 company without a board of directors or individuals performing similar                                                  
07 functions is the person performing the acts and assuming the duties of                                                  
08 depositor or manager under the trust or other agreement or instrument under                                             
09            which the security is issued;                                                                                
10 (B)  the issuer of an equipment trust certificate or similar                                                            
11 security serving the same purpose is the person by which the property is or will                                        
12 be used or to which the property or equipment is or will be leased or                                                   
13 conditionally sold or that is otherwise contractually responsible for ensuring                                          
14            payment of the certificate;                                                                                  
15 (C)  the issuer of a fractional undivided interest in an oil, gas, or                                                   
16 other mineral lease or in payments out of production under a lease, right, or                                           
17 royalty is the owner of an interest in the lease or in payments out of production                                       
18 under a lease, right, or royalty, whether whole or fractional, that creates                                             
19            fractional interests for the purpose of sale;                                                                
20 (21)  "nonissuer transaction" or "nonissuer distribution" means a                                                       
21       transaction or distribution not directly or indirectly for the benefit of the issuer;                             
22 (22)  "offer to purchase" includes an attempt or offer to obtain, or                                                    
23 solicitation of an offer to sell, a security or interest in a security for value; "offer to                             
24 purchase" does not include a tender offer that is subject to 15 U.S.C. 78n(d)                                           
25       (Securities Exchange Act of 1934);                                                                                
26 (23)  "older person" means a natural person who is 60 years of age or                                                   
27       older;                                                                                                            
28 (24)  "person" means an individual, a corporation, a partnership, a                                                     
29 limited liability company, a limited partnership, a limited liability partnership, an                                   
30 association, a joint-stock company, a trust in which the interests of the beneficiaries                                 
31 are evidenced by a security, an unincorporated organization, a government, or a                                         
01       political subdivision of a government;                                                                            
02                 (25)  "place of business" of a broker-dealer, an investment adviser, or a                               
03       federal covered investment adviser means                                                                          
04 (A)  an office at which the broker-dealer, investment adviser, or                                                       
05 federal covered investment adviser regularly provides brokerage or investment                                           
06 advice or solicits, meets with, or otherwise communicates with customers or                                             
07            clients; or                                                                                                  
08                      (B)  any other location that is held out to the general public as a                                
09            location at which the broker-dealer, investment adviser, or federal covered                                  
10 investment adviser provides brokerage or investment advice or solicits, meets                                           
11            with, or otherwise communicates with customers or clients;                                                   
12 (26)  "price amendment" means the amendment to a registration                                                           
13 statement filed under 15 U.S.C. 77a - 77aa (Securities Act of 1933) or, if an                                           
14 amendment is not filed, the prospectus or prospectus supplement filed under 15 U.S.C.                                   
15 77a - 77aa (Securities Act of 1933) that includes a statement of the offering price,                                    
16 underwriting and selling discounts or commissions, amount of proceeds, conversion                                       
17       rates, call prices, and other matters dependent on the offering price;                                            
18 (27)  "principal place of business" of a broker-dealer or an investment                                                 
19 adviser means the executive office of the broker-dealer or investment adviser from                                      
20 which the officers, partners, or managers of the broker-dealer or investment adviser                                    
21       direct, control, and coordinate the activities of the broker-dealer or investment adviser;                        
22 (28)  "record," except in the phrases "of record," "official record," and                                               
23 "public record," means information that is inscribed on a tangible medium or that is                                    
24       stored in an electronic or other medium and is retrievable in perceivable form;                                   
25 (29)  "sale" includes every contract of sale, contract to sell, or                                                      
26 disposition of a security or interest in a security for value, and "offer to sell" includes                             
27 every attempt or offer to dispose of, or solicitation of an offer to purchase, a security                               
28       or interest in a security for value; both terms include                                                           
29 (A)  a security given or delivered with, or as a bonus because of,                                                      
30 a purchase of securities or any other thing constituting part of the subject of the                                     
31            purchase and having been offered and sold for value;                                                         
01                      (B)  a gift of assessable stock involving an offer and sale; and                                   
02 (C)  a sale or offer of a warrant or right to purchase or subscribe                                                     
03 to another security of the same or another issuer and a sale or offer of a                                              
04 security that gives the holder a present or future right or privilege to convert                                        
05 the security into another security of the same or another issuer, including an                                          
06            offer of the other security;                                                                                 
07                 (30)  "Securities and Exchange Commission" means the United States                                      
08       Securities and Exchange Commission;                                                                               
09                 (31)  "securities business" means a business that provides the services                                 
10       provided by                                                                                                       
11 (A)  investment advisers, federal covered investment advisers,                                                          
12            or investment adviser representatives; or                                                                    
13 (B)  broker-dealers, issuers, or agents of broker-dealers or                                                            
14            issuers;                                                                                                     
15 (32)  "security" means a note; stock; treasury stock; security future;                                                  
16 bond; debenture; evidence of indebtedness; certificate of interest or participation in a                                
17 profit-sharing agreement; collateral trust certificate; preorganization certificate or                                  
18 subscription; transferable share; investment contract; voting trust certificate; certificate                            
19 of deposit for a security; viatical settlement; fractional undivided interest in oil, gas, or                           
20 other mineral rights; put, call, straddle, option, or privilege on a security, certificate of                           
21 deposit, or group or index of securities, including an interest in or based on the value                                
22 of a put, call, straddle, option, or privilege on a security, certificate of deposit, or                                
23 group or index of securities; put, call, straddle, option, or privilege entered into on a                               
24 national securities exchange relating to foreign currency; or, in general, an interest or                               
25 instrument commonly known as a "security"; or a certificate of interest or participation                                
26 in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to                             
27       subscribe to or purchase any of the foregoing; "security"                                                         
28                      (A)  includes                                                                                      
29                           (i)  both a certificated and an uncertificated security;                                      
30 (ii)  an investment in a common enterprise with the                                                                     
31 expectation of profits to be derived primarily from the efforts of a                                                    
01 person other than the investor; in this sub-subparagraph, "common                                                       
02 enterprise" means an enterprise in which the fortunes of the investor are                                               
03 interwoven with those of the person offering the investment, a third                                                    
04                 party, or other investors;                                                                              
05                           (iii)  as an investment contract, among other contracts,                                      
06                 an interest in a limited partnership and a limited liability company, and                               
07                 an investment in a viatical settlement or similar agreement; and                                        
08                           (iv)  a viatical settlement interest;                                                         
09                      (B)  does not include                                                                              
10 (i)  a participation agreement entered under                                                                            
11                 AS 14.40.802 or an insurance or endowment policy subject to AS 21;                                      
12 (ii)  an interest in a contributory or noncontributory                                                                  
13 pension or welfare plan subject to 29 U.S.C. 1001 - 1461 (Employee                                                      
14                 Retirement Income Security Act of 1974);                                                                
15 (33)  "self-regulatory organization" means a national securities                                                        
16 exchange registered under 15 U.S.C. 78a - 78pp (Securities Exchange Act of 1934), a                                     
17 national securities association of broker-dealers registered under 15 U.S.C. 78a - 78pp                                 
18 (Securities Exchange Act of 1934), a clearing agency registered under 15 U.S.C. 78a -                                   
19 78pp (Securities Exchange Act of 1934), or the Municipal Securities Rulemaking                                          
20       Board established under 15 U.S.C. 78o-4 (Securities Exchange Act of 1934);                                        
21 (34)  "sign" means, with present intent to authenticate or adopt a                                                      
22       record,                                                                                                           
23                      (A)  to execute or adopt a tangible symbol; or                                                     
24 (B)  to attach or logically associate with the record an electronic                                                     
25            symbol, sound, or process;                                                                                   
26 (35)  "state" means a state of the United States, the District of                                                       
27 Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular                                    
28       possession subject to the jurisdiction of the United States;                                                      
29                 (36)  "vulnerable adult" has the meaning given in AS 47.24.900.                                         
30 Sec. 45.56.995. Short title. This chapter may be cited as the Alaska Securities                                       
31       Act.                                                                                                              
01    * Sec. 26. AS 45.63.080(a) is amended to read:                                                                     
02            (a)  AS 45.63.010, 45.63.015, 45.63.020, and AS 45.63.030(c) and (d) do not                                  
03       apply to a sale or attempted sale                                                                                 
04                 (1)  of a security regulated under AS 45.56 [AS 45.55] or a security that                           
05       is exempted by AS 45.56.205 [AS 45.55.900] from regulation under AS 45.56                                 
06       [AS 45.55];                                                                                                       
07                 (2)  by a person registered with the United States Securities and                                       
08       Exchange Commission when acting within the scope of the person's Securities and                                   
09       Exchange Commission license;                                                                                      
10 (3)  by an issuer, or a subsidiary of an issuer, of a class of securities that                                          
11       is                                                                                                                
12 (A)  subject to 15 U.S.C. 78a - 78pp [15 U.S.C. 78a - 78lll]                                                        
13            (Securities Exchange Act of 1934); and                                                                       
14 (B)  either registered under 15 U.S.C. 78a - 78pp [15 U.S.C.                                                        
15 78a - 78lll] (Securities Exchange Act of 1934) or exempt from registration                                              
16            under 15 U.S.C. 78l(g)(2)(A) - (C) or (E) - (H);                                                             
17 (4)  by a real estate broker, associate real estate broker, or real estate                                              
18       salesperson licensed under AS 08.88 and acting in a capacity covered by the license;                              
19 (5)  by a person who has a certificate of registration under AS 08.18 to                                                
20 operate as a contractor and is acting in a capacity covered by the certificate of                                       
21       registration;                                                                                                     
22 (6)  by an embalmer or funeral director licensed under AS 08.42 and                                                     
23       acting in a capacity covered by the license;                                                                      
24 (7)  by an insurance agent, general agent, broker, solicitor, or adjuster                                               
25       licensed under AS 21.27 and acting in a capacity covered by the license;                                          
26 (8)  by a person who is primarily soliciting the sale of a subscription to,                                             
27       or advertising in, a newspaper of general circulation;                                                            
28 (9)  by a charitable organization or paid solicitor if the organization or                                              
29 solicitor is registered to make charitable solicitations under AS 45.68 and is acting in a                              
30       capacity that is covered by the registration;                                                                     
31 (10)  by a person who is primarily soliciting the sale of a sound                                                       
01       recording or book                                                                                                 
02                      (A)  if the person                                                                                 
03                           (i)  has no minimum purchase requirements;                                                    
04                           (ii)  provides written notice of the buyer's right to cancel                                  
05                 at any time; and                                                                                        
06                           (iii)  allows the buyer to return the sound recording or                                      
07                 book and obtain a full refund; or                                                                       
08                      (B)  through a membership in a book or record club                                                 
09                           (i)  where the club provides the buyer with a form that                                       
10 the buyer may use to instruct the club not to ship the offered                                                          
11                 merchandise; and                                                                                        
12 (ii)  that is regulated by the Federal Trade Commission                                                                 
13                 as a negative option plan under 16 C.F.R. Part 425;                                                     
14 (11)  by a publisher, or a publisher's agent operating under a written                                                  
15 agreement between a publisher and the agent, who is soliciting the sale of a publisher's                                
16       magazine if                                                                                                       
17 (A)  the buyer has the right to review the magazine and cancel                                                          
18 the subscription for the magazine within seven days after receipt of the                                                
19 magazine or at the time the invoice is received by the buyer, whichever is later;                                       
20 a cancellation request is timely if the request is mailed, properly addressed and                                       
21            postmarked, postage prepaid, within seven days after receipt of the magazine;                                
22 (B)  the right of cancellation and refund is fully disclosed in                                                         
23 writing to the buyer before or at the time the initial invoice is received by the                                       
24            buyer;                                                                                                       
25 (12)  of services provided by a cable television system operating under                                                 
26       a franchise issued by a municipality;                                                                             
27 (13)  by a person who is soliciting for a business, or for an affiliate of a                                            
28       business, that is regulated by the Regulatory Commission of Alaska;                                               
29 (14)  by a person whose solicitation is solely for telephone answering                                                  
30       services provided by the person or the person's employer;                                                         
31 (15)  of property from a mail order catalog that is published on a                                                      
01 regular, periodic basis and that describes or pictures the items for sale and prominently                               
02       provides the specific price of each item;                                                                         
03 (16)  by a supervised financial institution or the parent, subsidiary, or                                               
04 affiliate of a supervised financial institution; in this paragraph, "supervised financial                               
05 institution" means a commercial bank, savings bank, mutual savings bank, trust                                          
06 company, savings and loan association, credit union, industrial loan company,                                           
07 personal property broker, consumer finance lender, commercial finance lender, or                                        
08 other financial institution if the financial institution is subject to regulation by this                               
09       state or the United States;                                                                                       
10                 (17)  by an insurer or the parent, subsidiary, or affiliate of an insurer;                              
11 (18)  by a person who solicits a sale by a contact by telephonic means                                                  
12 without intending to complete the sales presentation during the contact, who does not                                   
13 complete the sales presentation during the contact, and who only completes the sales                                    
14 presentation at a later meeting in person, unless at the later meeting the solicitor                                    
15 attempts to collect payment for property or services delivered before the later meeting;                                
16 (19)  of an item of personal property, including a food product, that is                                                
17 made by hand by an individual, if the sale or attempted sale of the item is made by the                                 
18 individual who made the item; in this paragraph, "made by hand" includes the use of                                     
19 ordinary household devices if the majority of the value of the item is added by the                                     
20       labor of the individual.                                                                                        
21    * Sec. 27. AS 45.66.220 is amended to read:                                                                        
22 Sec. 45.66.220. Exemptions. This chapter does not apply to a sale of or an                                            
23       offer to sell                                                                                                     
24 (1)  a business opportunity if the total amount of the payments to be                                                   
25       made by the buyer under the contract is less than $250;                                                           
26                 (2)  a franchise under 16 C.F.R. Part 436 [16 C.F.R. 436];                                          
27 (3)  an ongoing business operated by the seller that is to be sold in its                                               
28       entirety;                                                                                                         
29 (4)  a business opportunity to an ongoing business if the seller will                                                   
30 provide products, equipment, supplies, or services that are to be sold by the buyer in                                  
31       connection with the buyer's ongoing business;                                                                     
01                 (5)  sales demonstration equipment, materials, or samples for use in                                    
02       sales demonstrations and not for resale, or product inventory sold to the buyer at a                              
03       bona fide wholesale price;                                                                                        
04                 (6)  a business opportunity by an executor, an administrator, a marshal,                                
05       a receiver, a trustee in bankruptcy, or a guardian or conservator, or under a judicial                            
06       sale;                                                                                                             
07                 (7)  a security registered under AS 45.56 [AS 45.55] or a security that                             
08       is exempted by AS 45.56.205 [AS 45.55.900] from registration under AS 45.56                               
09       [AS 45.55];                                                                                                       
10 (8)  a business opportunity if the sale or offer is made by a person                                                    
11 registered with the United States Securities and Exchange Commission when acting                                        
12 within the scope of the person's Securities and Exchange Commission license or by a                                     
13 person registered by the state under AS 45.56 [AS 45.55] when acting within the                                     
14       scope of registration;                                                                                            
15 (9)  a business opportunity by an issuer or a subsidiary of an issuer of a                                              
16       class of securities that is                                                                                       
17 (A)  subject to 15 U.S.C. 78a - 78pp [15 U.S.C. 78a - 78lll]                                                        
18            (Securities Exchange Act of 1934); and                                                                       
19 (B)  registered under 15 U.S.C. 78a - 78pp [15 U.S.C. 78a -                                                         
20 78lll] (Securities Exchange Act of 1934) unless exempt from registration under                                          
21            15 U.S.C. 78l(g)(2)(A) - (C) or (E) - (H);                                                                   
22                 (10)  a business opportunity in which the buyer is                                                      
23 (A)  a bank, savings and loan association, trust company,                                                               
24            insurance company, credit union, or investment company under 15 U.S.C. 80a-                                  
25 1 - 80a-64 (Investment Company Act of 1940), pension or profit sharing trust,                                           
26            or other financial institution or institutional buyer; or                                                    
27                      (B)  a broker-dealer registered under AS 45.56.405 [AS 45.55];                                 
28 (11)  a business opportunity that involves a marketing plan made in                                                     
29 conjunction with the registration of a trademark or service mark under 15 U.S.C. 1051                                   
30 - 1127 (Trademark Act of 1946) if the seller has a minimum net worth of $1,000,000                                      
31 as determined on the basis of the seller's most recent audited financial statement                                      
01 prepared within 13 months of the first offer to sell in this state; net worth may be                                    
02 determined on a consolidated basis if one person owns at least 80 percent of the seller                                 
03 and that one person expressly guarantees the obligations of the seller that arise under                                 
04       the sale or offer claimed to be exempt under this paragraph; or                                                   
05                 (12)  a business opportunity in which either the seller or the buyer is                                 
06       licensed as a real estate broker, associate real estate broker, or real estate salesperson                        
07       under AS 08.88 and the sale or offer is regulated by AS 08.88.                                                    
08    * Sec. 28. AS 45.66.900(11) is amended to read:                                                                    
09                 (11)  "securities or investment laws" means AS 45.56 [AS 45.55]                                     
10 (Alaska Securities Act) or a substantially similar statute of another jurisdiction, 15                              
11 U.S.C. 77a - 77aa [15 U.S.C. 77a - 77bbbb] (Securities Exchange Act of 1933), 15                                
12 U.S.C. 78a - 78pp [15 U.S.C. 78a - 78lll] (Securities Exchange Act of 1934), or 15                                  
13 U.S.C. 80a-1 - 80b-21 (Investment Company Act of 1940/Investment Advisers Act of                                        
14       1940);                                                                                                            
15    * Sec. 29. AS 45.55.010, 45.55.020, 45.55.023, 45.55.025, 45.55.027, 45.55.028, 45.55.030,                         
16 45.55.035, 45.55.040, 45.55.050, 45.55.060, 45.55.070, 45.55.075, 45.55.080, 45.55.090,                                 
17 45.55.100, 45.55.110, 45.55.120, 45.55.150, 45.55.155, 45.55.170, 45.55.175, 45.55.900,                                 
18 45.55.905(c), 45.55.915, 45.55.930, 45.55.935(b), 45.55.970, 45.55.980, and 45.55.995 are                               
19 repealed.                                                                                                               
20    * Sec. 30. The uncodified law of the State of Alaska is amended by adding a new section to                         
21 read:                                                                                                                   
22 INDIRECT COURT RULE AMENDMENTS. (a) The provisions of AS 45.56.630(c)                                                   
23 - (e), enacted by sec. 25 of this Act, have the effect of changing Rules 4 and 5, Alaska Rules                          
24 of Civil Procedure, by allowing service on the administrator in certain cases.                                          
25 (b)  The provisions of AS 45.56.650(f), enacted by sec. 25 of this Act, have the effect                                 
26 of changing Rule 54, Alaska Rules of Civil Procedure, by expanding the definition of                                    
27 judgments to include final judgments of the administrator issued under AS 45.56.650, enacted                            
28 by sec. 25 of this Act.                                                                                                 
29 (c)  The provisions of AS 45.56.650(g), enacted by sec. 25 of this Act, have the effect                                 
30 of changing Rule 90, Alaska Rules of Civil Procedure, by changing the contempt procedure in                             
31 certain cases.                                                                                                          
01       (d)  The provisions of AS 45.56.655(c), enacted by sec. 25 of this Act, have the effect                           
02 of changing Rule 65, Alaska Rules of Civil Procedure, by changing the procedure for                                     
03 injunctions in certain cases by prohibiting requiring the administrator to post a bond.                                 
04       (e)  The provisions of AS 45.56.675(a), enacted by sec. 25 of this Act, have the effect                           
05 of changing Rule 602, Alaska Rules of Appellate Procedure, by changing the time for filing a                            
06 notice of appeal.                                                                                                       
07    * Sec. 31. The uncodified law of the State of Alaska is amended by adding a new section to                         
08 read:                                                                                                                   
09       TRANSITION: REGULATIONS. The Department of Commerce, Community, and                                               
10 Economic Development may adopt regulations necessary to implement AS 45.56, enacted by                                  
11 sec. 25 of this Act. The regulations take effect under AS 44.62 (Administrative Procedure                               
12 Act), but not before the effective date of sec. 25 of this Act.                                                         
13    * Sec. 32. The uncodified law of the State of Alaska is amended by adding a new section to                         
14 read:                                                                                                                   
15 TRANSITION: APPLICATION OF ACT TO EXISTING PROCEEDINGS AND                                                              
16 EXISTING RIGHTS AND DUTIES. (a) Former AS 45.55 exclusively governs all actions or                                      
17 proceedings that are pending on the effective date of sec. 25 of this Act or that may be                                
18 instituted based on conduct occurring before the effective date of sec. 25 of this Act, but a                           
19 civil action may not be maintained to enforce any liability under former AS 45.55, unless                               
20 instituted within any period of limitation that applied when the cause of action accrued or                             
21 within five years after the effective date of sec. 25 of this Act, whichever is earlier.                                
22 (b)  All effective registrations under former AS 45.55 and all administrative orders                                    
23 relating to the registrations, regulations, statements of policy, interpretative opinions,                              
24 declaratory rulings, determinations to take no action, and conditions imposed on the                                    
25 registrations under former AS 45.55 remain in effect while they would have remained in                                  
26 effect if this Act had not been enacted. They are considered to have been filed, issued, or                             
27 imposed under this Act, but are exclusively governed by former AS 45.55, unless removed or                              
28 replaced by the administrator.                                                                                          
29 (c)  Former AS 45.55 exclusively applies to an offer or sale made within one year after                                 
30 the effective date of sec. 25 of this Act under an offering made in good faith before the                               
31 effective date of sec. 25 of this Act based on an exemption available under former AS 45.55.                            
01       (d)  In this section, "former AS 45.55" means AS 45.55 as the provisions under that                               
02 chapter read on the day before the effective date of this section.                                                      
03    * Sec. 33. The uncodified law of the State of Alaska is amended by adding a new section to                         
04 read:                                                                                                                   
05       REVISOR'S INSTRUCTION. The revisor of statutes is requested to change the                                         
06 chapter heading of AS 45.55 from "Alaska Securities Act" to "Alaska Native Claims                                       
07 Settlement Act Corporations Proxy Solicitations and Initial Issuance of Stock."                                         
08    * Sec. 34. The uncodified law of the State of Alaska is amended by adding a new section to                         
09 read:                                                                                                                   
10 CONDITIONAL EFFECT. AS 45.56.630(c) - (e), 45.56.650(f) and (g), 45.56.655(c),                                          
11 and 45.56.675(a), enacted by sec. 25 of this Act, take effect only if sec. 30 of this Act receives                      
12 the two-thirds majority vote of each house required by art. IV, sec. 15, Constitution of the                            
13 State of Alaska.                                                                                                        
14    * Sec. 35. Section 31 of this Act takes effect immediately under AS 01.10.070(c).                                  
15    * Sec. 36. Except as provided in sec. 35 of this Act, this Act takes effect January 1, 2019.                       
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