When used in this chapter, unless the context otherwise requires:
(a) "Commissioner" means the Auditor of the State of West Virginia.
(b) "Agent" means any individual other than a broker-dealer who represents a broker-dealer
or issuer in effecting or attempting to effect purchases or sales of securities. "Agent" does
not include an individual who represents an issuer in: (1) Effecting transactions in a security
exempted by subdivision (1), (2), (3), (10) or (11), subsection (a), section four hundred two of
this article; (2) effecting transactions exempted by subsection (bu), section four hundred two
of this article; (3) effecting transactions in a covered security as described in section
18(b)(3) and section 18(b)(4)(d) of the Securities Act of 1933; (4) effecting transactions with
existing employees, partners or directors of the issuer if no commission or other
remuneration is paid or given, directly or indirectly, for soliciting any person in this state; or
(5) effecting transactions in this state limited to those transactions described in section
15(h)(2) of the Securities Exchange Act of 1934. A lpartner, officer or director of a broker-
dealer or issuer, or a person occupying a simislar status or performing similar functions, is an
agent only if he or she otherwise comes within this definition.
(c) "Broker-dealer" means any persogn engaged in the business of effecting transactions in
securities for the account of others or for his or her own account. "Broker-dealer" does not
include: (1) An agent; (2) an issuer; (3) a bank, savings institution or trust company; or (4) a
person who has no place of business in this state if: (A) He or she effects transactions in this
state exclusively with or through: (i) The issuers of the securities involved in the
transactions; (ii) other broker-dealers; or (iii) banks, savings institutions, trust companies,
insurance companies, investment companies as defined in the Investment Company Act of
1940, pension or profit-sharing trusts or other financial institutions or institutional buyers,
whether acting for themselves or as trustees; or (B) during any period of twelve consecutive
months he or she does not direct more than fifteen offers to sell or buy into this state in any
manWner to persons other than those specified in subparagraph (A), paragraph (4) of this
subdivision, whether or not the offeror or any of the offerees is then present in this state.
(d) "Fraud", "deceit" and "defraud" are not limited to common-law deceit.
(e) "Guaranteed" means guaranteed as to payment of principal, interest or dividends.
(f) "Federal-covered adviser" means a person who is: (1) Registered under section 203 of the
Investment Advisers Act of 1940 or (2) is excluded from the definition of "investment
advisor" under section two hundred two-a (11) of the Investment Advisers Act of 1940.
(g) "Investment adviser" means any person who, for compensation, engages in the business
of advising others, either directly or through publications or writings, as to the value of
securities or as to the advisability of investing in, purchasing or selling securities or who, for
compensation and as a part of a regular business, issues or promulgates analyses or reports
concerning securities. "Investment adviser" also includes financial planners and other
persons who, as an integral component of other financially related services, provide the
foregoing investment advisory services to others for compensation and as part of a business
or who hold themselves out as providing the foregoing investment advisory services to
others for compensation. "Investment adviser" does not include: (1) A bank, savings
institution or trust company; (2) a lawyer, accountant, engineer or teacher whose
performance of those services is solely incidental to the practice of his or heer profession; (3)
a broker-dealer whose performance of these services is solely incidental to the conduct of his
or her business as a broker-dealer and who receives no special compenrsation for them; (4) a
publisher, employee or columnist of a newspaper, news magazine or business or financial
publication or an owner, operator, producer or employee of a cable, radio or television
network, station or production facility if, in either case, the financial or business news
published or disseminated is made available to the general ptublic and the content does not
consist of rendering advice on the basis of the specific investment situation of each client;
(5) a person whose advice, analyses or reports relate only to securities exempted by
subdivision (1), subsection (a), section four hundred two of this article; (6) a person who has
no place of business in this state if: (A) His or her only clients in this state are other
investment advisers, broker-dealers, banks, savings institutions, trust companies, insurance
companies, investment companies as defined in the Investment Company Act of 1940,
pension or profit-sharing trusts or other financial institutions or institutional buyers,
whether acting for themselves or as trustees; or (B) during any period of twelve consecutive
months he or she does not have more than five clients who are residents of this state other
than those specified in subparagraph (A), paragraph (6), of this subdivision, whether or not
he or she or any of the persons to whom the communications are directed is then present in
this state; (7) an investment adviser representative; (8) a "federal-covered adviser"; or (9)
such other persons not within the intent of this paragraph as the commissioner may by rule
or order designate.
(h) "Investment adviser representative" means any partner, officer, director of or a person
occupying a similar status or performing similar functions or other individual, except clerical
or ministerial personnel, who is employed by or associated with an investment adviser that is
registered or required to be registered under this chapter or who has a place of business
located in this state and is employed by or associated with a federal-covered adviser; and
including clerical or ministerial personnel, who does any of the following: (1) Makes any
recommendations or otherwise renders advice regarding securities; (2) manages accounts or
portfolios of clients; (3) determines which recommendation or advice regarding securities
should be given; (4) solicits, offers or negotiates for the sale of or sells investment advisory
services unless the person is registered as an agent pursuant to this article; or (5) supervises
employees who perform any of the foregoing unless the person is registered as an agent
pursuant to this article.
(i) "Issuer" means any person who issues or proposes to issue any security, except that: (1)
With respect to certificates of deposit, voting-trust certificates or collateral-trust certificates
or with respect to certificates of interest or shares in an unincorporated investment trust not
having a board of directors or persons performing similar functions or of the fixed, restricted
management or unit type, the term "issuer" means the person or persons performing the
acts and assuming the duties of depositor or manager pursuant to the provisions of the trust
or other agreement or instrument under which the security is issued; and (2) with respect to
certificates of interest or participation in oil, gas or mining titles or leases or in payments out
of production under such titles or leases, there is not considered to be any "issuer".
(j) "Nonissuer" means not, directly or indirectly, for the benefit of the issuer.
(k) "Person" means an individual, a corporation, a partnership, an association, a joint-stock
company, a trust where the interests of the beneficiaries are eviduenced by a security, an
unincorporated organization, a government or a political subdivision of a government.
(l) (1) "Sale" or "sell" includes every contract of sale of, contract to sell, or disposition of a
security or interest in a security for value; a
(2) "Offer" or "offer to sell" includes every attempt lor offer to dispose of, or solicitation of an
offer to buy, a security or interest in a securitsy for value;
(3) Any security given or delivered with, ori as a bonus on account of, any purchase of
securities or any other thing is considered to constitute part of the subject of the purchase
and to have been offered and sold for value;
(4) A purported gift of assessable stock is considered to involve an offer and sale;
(5) Every sale or offer of a warrant or right to purchase or subscribe to another security of
the same or another issuer, as well as every sale or offer of a security which gives the holder
a present or future r ight or privilege to convert into another security of the same or another
issuer, is consVidered to include an offer of the other security;
(6) The terms defined in this subdivision do not include: (A) Any bona fide pledge or loan; (B)
any stock dividend, whether the corporation distributing the dividend is the issuer of the
stock or not, if nothing of value is given by stockholders for the dividend other than the
surrender of a right to a cash or property dividend when each stockholder may elect to take
the dividend in cash or property or in stock; (C) any act incident to a class vote by
stockholders, pursuant to the certificate of incorporation or the applicable corporation
statute, on a merger, consolidation, reclassification of securities or sale of corporate assets
in consideration of the issuance of securities of another corporation; or (D) any act incident
to a judicially approved reorganization in which a security is issued in exchange for one or
more outstanding securities, claims or property interests, or partly in such exchange and
partly for cash.
(m) "Securities Act of 1933", "Securities Exchange Act of 1934", "Public Utility Holding
Company Act of 1935" and "Investment Company Act of 1940" mean the federal statutes of
those names as amended before the effective date of this chapter. The National Securities
Markets Improvement Act of 1996 ("NSMIA") means the federal statute which makes certain
amendments to the Securities Act of 1933, the Securities Exchange Act of 1934, the
Investment Company Act of 1940 and the Investment Advisers Act of 1940.
(n) "Security" means any note; stock; treasury stock; bond; debenture; evidence of
indebtedness; certificate of interest or participation in any profit-sharing agreement;
collateral-trust certificate; preorganization certificate or subscription; transeferable share;
investment contract; voting-trust certificate; certificate of deposit for a security; viatical
settlement contract; certificate of interest or participation in an oil, gasr or mining title or
lease or in payments out of production under such a title or lease; or, in general, any interest
or instrument commonly known as a "security" or any certificate of interest or participation
in, temporary or interim certificate for, receipt for, guarantee of or warrant or right to
subscribe to or purchase any of the foregoing. "Security" doets not include any insurance or
endowment policy or annuity contract under which an insurance company promises to pay
money either in a lump sum or periodically for life or some other specified period: Provided,
That "security" does include insurance or endowment policies or annuity contracts that are
viatical settlement contracts or agreements for the purchase, sale, assignment, transfer,
devise or bequest of any portion of a death benefit or ownership of a life insurance policy or
certificate that is less than the expected death benefit of the life insurance policy or
certificate.
(o) "Federal-covered security" means any security that is a covered security under section
18(b) of the Securities Act of 1e933, as amended by the National Securities Markets
Improvement Act of 1996, or rules promulgated thereunder.
(p) "State" means any state, territory or possession of the United States, the District of
Columbia and Puerto Rico.
(q) "Branch office" means any location other than the main office, identified to the public,
customers or clients as a location where a broker-dealer or investment adviser or federal-
covWered adviser conducts a securities or investment adviser business. Branch office does not
include:
(1) A location identified solely in a telephone directory line listing or on a business card or
letterhead if: (A) The listing, card or letterhead also includes the address and telephone
number of the broker-dealer or investment adviser or federal covered adviser where the
individuals conducting business from the location are directly supervised; and (B) no more
than one agent or investment adviser representative transacts business on behalf of the
broker-dealer or investment adviser or federal-covered adviser from an identified location;
or
(2) Any other location as the commissioner may determine.‹ Prev All West Virginia sections Next ›
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