815 ILCS 5/ Illinois Securities Law of 1953.
(815 ILCS 5/1) (from Ch. 121 1/2, par. 137.1) Sec. 1. Short title. This Act may be cited as the Illinois Securities Law of 1953. (Source: P.A. 86‑1475.) |
(815 ILCS 5/2) (from Ch. 121 1/2, par. 137.2) Sec. 2. Definitions. As used in this Act, unless the context otherwise requires, the terms defined in the Sections of this Act that precede Section 3 shall have the meanings therein ascribed. (Source: P.A. 87‑463.) |
(815 ILCS 5/2.2) (from Ch. 121 1/2, par. 137.2‑2) Sec. 2.2. "Issuer" means every person who shall have issued or proposes to issue any security; except that (1) with respect to certificates of deposit, voting‑trust certificates, collateral‑trust certificates, and certificates of interest or shares in an unincorporated investment trust not having a board of directors (or persons performing similar functions), "issuer" means the person or persons performing the acts and assuming the duties of depositor or manager pursuant to the provisions of the trust, agreement or instrument under which such securities are issued; (2) with respect to trusts other than those specified in clause (1) above, where the trustee is a corporation authorized to accept and execute trusts, "issuer" means the entrusters, depositors or creators of the trust and any manager or committee charged with the general direction of the affairs of the trust pursuant to the provisions of the agreement or instrument creating the trust; (3) with respect to equipment trust certificates or like securities, "issuer" means the person to whom the equipment or property is or is to be leased or conditionally sold; and (4) with respect to fractional interests in oil, gas or other mineral lease, right or royalty, "issuer" means the owner of the right or interest therein (whether whole or fractional), in which fractional interests are created by such owner for the purpose of sale. (Source: P.A. 85‑1445.) |
(815 ILCS 5/2.3) (from Ch. 121 1/2, par. 137.2‑3) Sec. 2.3. "Person" means an individual, a corporation, a partnership, an association, a joint stock company, a limited liability company, a limited liability partnership, a trust or any unincorporated organization. As used in this Section, "trust" includes only a trust where the interest or interests of the beneficiary or beneficiaries is a security. (Source: P.A. 90‑70, eff. 7‑8‑97; 90‑655, eff. 7‑30‑98.) |
(815 ILCS 5/2.4) (from Ch. 121 1/2, par. 137.2‑4) Sec. 2.4. "Controlling person" means any person offering or selling a security, or group of persons acting in concert in the offer or sale of a security, owning beneficially (and in the absence of knowledge, or reasonable grounds for belief, to the contrary, record ownership shall for the purposes hereof be presumed to be beneficial ownership) either (i) 25% or more of the outstanding voting securities of the issuer of such security where no other person owns or controls a greater percentage of such securities, or (ii) such number of outstanding securities of the issuer of such security as would enable such person, or group of persons, to elect a majority of the board of directors or other managing body of such issuer. In case of unincorporated issuers, "controlling person" means any person offering or selling a security, or group of persons acting in concert in the offer or sale of a security, who directly or indirectly controls the activities of the issuer. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.5) (from Ch. 121 1/2, par. 137.2‑5) Sec. 2.5. "Sale" or "sell" shall have the full meaning of that term as applied by or accepted in the courts of this State, and shall include every contract of sale or disposition of a security or interest in a security for value. Any security given with or as a bonus on account of any purchase of securities or property shall be conclusively presumed to constitute a part of the subject of such purchase and shall be deemed to have been sold within the meaning of this Section. A privilege to convert a security into another security shall not be deemed a sale of such other security, provided no consideration from the holder in addition to the surrender or cancellation of the convertible security is required to effect the conversion. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.5a) (from Ch. 121 1/2, par. 137.2‑5a) Sec. 2.5a. Offer. "Offer" shall include every offer to sell or otherwise dispose of, or solicitation of an offer to purchase, whether orally or by means of publication, including but not limited to printed and electronic media, a security or interest in a security for value; provided that the term "offer" shall not include preliminary negotiations or agreements between an issuer and any underwriter or among underwriters who are or are to be in privity of contract with an issuer, or the circulation or publication of an identifying statement or circular or preliminary prospectus, as defined by rules or regulations of the Secretary of State. (Source: P.A. 91‑809, eff. 1‑1‑01.) |
(815 ILCS 5/2.6) (from Ch. 121 1/2, par. 137.2‑6) Sec. 2.6. "Underwriter" means any person who has purchased a security from an issuer or a controlling person with a view to, or who offers or sells a security for an issuer or a controlling person in connection with, the distribution thereof, or who participates or has a participation in the direct or indirect underwriting of such distribution; but such term shall not include a person whose interest is limited to a commission or discount from an underwriter or dealer not in excess of the usual and customary distributors' or sellers' commission or discount. An underwriter shall be deemed to be no longer an underwriter of a security after he or she has completely disposed of his or her allotment of such security or, if he or she did not purchase the security, after he or she has ceased to offer and sell such security for the issuer or controlling person. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.7) (from Ch. 121 1/2, par. 137.2‑7) Sec. 2.7. "Dealer" means any person, other than a salesperson, or controlling person and other than a bank organized under the banking laws of this State or of the United States or other than a trust company organized under the laws of this State or other than a regular employee of such bank or trust company, who engages in this State, either for all or part of his or her time, directly or indirectly, as agent, broker or principal, in the business of offering, selling, buying and selling, or otherwise dealing or trading in securities issued by another person, any government or political subdivision or instrumentality thereof. (Source: P.A. 86‑368.) |
(815 ILCS 5/2.8) (from Ch. 121 1/2, par. 137.2‑8) Sec. 2.8. "Registered dealer" means a dealer registered under Section 8 of this Act. (Source: Laws 1961, p. 3663.) |
(815 ILCS 5/2.8a) (from Ch. 121 1/2, par. 137.2‑8a) Sec. 2.8a. "Principal of a dealer" means any officer, director, partner, member, trustee or manager of such dealer who is responsible for the supervision of the securities activities in this State of salespersons and for management of the daily business operations in this State of such dealer. (Source: P.A. 85‑1445.) |
(815 ILCS 5/2.9) (from Ch. 121 1/2, par. 137.2‑9) Sec. 2.9. "Salesperson" means an individual, other than an issuer or a dealer, employed or appointed or authorized by a dealer, issuer or controlling person to offer, purchase or sell securities in this State. The partners or officers of a dealer or issuer shall not be deemed to be salespersons within the meaning of this definition if they are not or have not been regularly engaged in securities offering, purchasing or selling activities other than transactions for their own respective accounts. No individual shall be deemed to be a salesperson solely by reason of effecting transactions in a covered security to qualified purchasers as described in Section 18(b)(3) of the Federal 1933 Act, effecting transactions in a covered security as described in Section 18(b)(4)(D) of the Federal 1933 Act, or engaging in offers or effecting sales of securities to employees of the issuer of such securities or to employees of the parent or any majority owned subsidiary of such issuer, provided that such individual is an employee of such issuer, parent or subsidiary who has not been employed primarily to make such offers or sales and who receives no special compensation, directly or indirectly, for or on account of any such offer or sale. "Salesperson" also means a limited Canadian salesperson. "Salesperson" also means an individual who, in this State, communicates with members of the public to identify prospective customers for the purpose of soliciting the purchase or sale of securities or related services. (Source: P.A. 90‑70, eff. 7‑8‑97; 90‑667, eff. 7‑30‑98; 91‑809, eff. 1‑1‑01.) |
(815 ILCS 5/2.10) (from Ch. 121 1/2, par. 137.2‑10) Sec. 2.10. "Registered salesperson" means a salesperson registered under Section 8 of this Act. "Registered salesperson" also means a registered limited Canadian salesperson. (Source: P.A. 90‑70, eff. 7‑8‑97.) |
(815 ILCS 5/2.10a) Sec. 2.10a. Telephone solicitor. "Telephone solicitor" means a natural person who makes or causes to be made an unsolicited telephone call with the intent to offer or sell a security. (Source: P.A. 90‑667, eff. 7‑30‑98.) |
(815 ILCS 5/2.11) (from Ch. 121 1/2, par. 137.2‑11) Sec. 2.11. Investment adviser. "Investment adviser" means any person who, for compensation, engages in this State 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, in this State for direct or indirect compensation and as part of a regular advisory business, issues or promulgates analyses or reports concerning securities or any financial planner or other person who, as an integral component of other financially related services, provides the foregoing investment advisory services to others for compensation and as part of a business or who holds himself or herself out as providing the foregoing investment advisory services to others for compensation; but "investment adviser" does not include: (1) a bank or trust company, or the regular employees of a bank or trust company; (2) any lawyer, accountant, engineer, geologist or teacher (i) whose performance of such services is solely incidental to the practice of his or her profession or (ii) who: (A) does not exercise investment discretion with | ||
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(B) does not accept or receive, directly or | ||
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(C) does not advise on the purchase or sale of | ||
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(3) any registered dealer or partner, officer, director or regular employee of a registered dealer, or registered salesperson, whose performance of these services, in each case, is solely incidental to the conduct of the business of the registered dealer or registered salesperson, as the case may be, and who receives no special compensation, directly or indirectly, for such services; (4) any publisher or regular employee of such publisher of a bona fide newspaper, news magazine or business or financial publication of regular and established paid circulation; (5) any person whose advice, analyses or reports relate only to securities which are direct obligations of, or obligations guaranteed as to principal or interest by, the United States, any state or any political subdivision of any state, or any public agency or public instrumentality of any one or more of the foregoing; (5.5) any person who is a federal covered investment adviser; or (6) any other persons who are not within the intent of this Section as the Secretary of State may designate by rules and regulations or order. (Source: P.A. 90‑70, eff. 7‑8‑97.) |
(815 ILCS 5/2.12) (from Ch. 121 1/2, par. 137.2‑12) Sec. 2.12. "Registered investment adviser" means an investment adviser registered under Section 8 of this Act. (Source: Laws 1961, p. 3663.) |
(815 ILCS 5/2.12a) (from Ch. 121 1/2, par. 137.2‑12a) Sec. 2.12a. "Principal of an investment adviser" means any officer, director, partner, member, trustee or manager of such investment adviser who is responsible for the supervision of the registered representatives in this State of such investment adviser, and for management of the daily business operations in this State of such investment adviser. (Source: P.A. 85‑1445.) |
(815 ILCS 5/2.12b) (from Ch. 121 1/2, par. 137.2‑12b) Sec. 2.12b. Investment adviser representative. "Investment adviser representative" means, with respect to an investment adviser who is required to register under this Act, any partner, officer, director of (or a person occupying a similar status or performing similar functions), or other natural person employed by or associated with an investment adviser, except clerical or ministerial personnel, who in this State: (1) makes any recommendations or otherwise renders | ||
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(2) manages accounts or portfolios of clients; (3) determines what recommendation or advice | ||
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(4) supervises any employee who performs any of the | ||
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(5) solicits, refers, offers, or negotiates for the | ||
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With respect to a federal covered investment adviser, "investment adviser representative" means any person who is an investment adviser representative with a place of business in this State as such terms are defined by the Securities and Exchange Commission under Section 203A of the Federal 1940 Investment Advisers Act. (Source: P.A. 90‑70, eff. 7‑8‑97; 90‑667, eff. 7‑30‑98; 91‑809, eff. 1‑1‑01.) |
(815 ILCS 5/2.12c) Sec. 2.12c. Registered investment adviser representative. "Registered investment adviser representative" means an investment adviser representative registered under Section 8 of this Act. (Source: P.A. 90‑70, eff. 7‑8‑97.) |
(815 ILCS 5/2.13) (from Ch. 121 1/2, par. 137.2‑13) Sec. 2.13. "Effective date" when used with respect to a registration under the Federal 1933 Act means the date and time as of which a statement for the registration of securities under said Act first becomes effective or, upon the election of an applicant for registration under subsection A of Section 5, subsection A of Section 6 or subsection A of Section 7 of this Act, the date and time as of which a post‑effective amendment to the registration statement filed under the Federal 1933 Act relating to such securities becomes effective; provided that in the case of securities initially registered under the Federal 1933 Act for the invitation of competitive bids, "effective date" shall mean the date upon which a post‑effective amendment to the registration statement filed under the Federal 1933 Act relating to such securities becomes effective for the first offering of such securities otherwise than for such invitation or, upon the election of any applicant for registration under subsection A of Section 5, subsection A of Section 6 or subsection A of Section 7 of this Act, the date and time as of which a subsequent post‑effective amendment filed under the Federal 1933 Act relating to such securities becomes effective. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.14) (from Ch. 121 1/2, par. 137.2‑14) Sec. 2.14. "Face amount certificate contract" means any form of "face amount certificate" or "periodic payment plan certificate" (as so designated and defined under the Federal Investment Company Act of 1940) and shall also mean any form of annuity contract (other than an annuity contract issued by a life insurance company authorized to transact business in this State), or installment face amount certificate contract, or installment face amount certificate, or installment participation certificate, or installment face amount certificate bond, or similar security evidencing an obligation on the part of the issuer to pay a stated or determinable sum or sums at a fixed or determinable date or dates more than twenty‑four months after the date of issuance, or to pay the proceeds of liquidation of an interest in certain specified securities or in a unit or fund, upon the payment of a single lump sum at the date of issuance, or in consideration of the payment of periodic installments of a stated or determinable amount. (Source: Laws 1961, p. 3663.) |
(815 ILCS 5/2.15) (from Ch. 121 1/2, par. 137.2‑15) Sec. 2.15. "Investment fund shares" means securities issued by persons known as "investment funds" or "investment companies" or "investment trusts" but such term shall not include securities issued by persons not within the intent of this Section as the Secretary of State may designate by rules and regulations or order. (Source: Laws 1961, p. 3663.) |
(815 ILCS 5/2.16) (from Ch. 121 1/2, par. 137.2‑16) Sec. 2.16. "Securities Director" means the chief administrator of the Securities Department, appointed by the Secretary of State. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.17) (from Ch. 121 1/2, par. 137.2‑17) Sec. 2.17. "Federal 1933 Act" means the Act of the Congress of the United States known as the Securities Act of 1933, as amended. (Source: P.A. 80‑556.) |
(815 ILCS 5/2.17a) (from Ch. 121 1/2, par. 137.2‑17a) Sec. 2.17a. "Federal 1934 Act" means the Act of Congress of the United States known as the Securities Exchange Act of 1934, as amended. (Source: P.A. 85‑1445.) |
(815 ILCS 5/2.17b) (from Ch. 121 1/2, par. 137.2‑17b) Sec. 2.17b. Federal 1974 Act. "Federal 1974 Act" means the Act of Congress of the United States known as the Commodity Exchange Act, as amended. (Source: P.A. 89‑209, eff. 1‑1‑96; 90‑70, eff. 7‑8‑97.) |
(815 ILCS 5/2.17c) (from Ch. 121 1/2, par. 137.2‑17c) Sec. 2.17c. "Federal Bankruptcy Code" means the Act of Congress of the United States known as the Bankruptcy Code of 1978, as amended. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.17d) (from Ch. 121 1/2, par. 137.2‑17d) Sec. 2.17d. "Federal 1940 Investment Company Act" means the Act of Congress of the United States known as the Investment Company Act of 1940, as amended. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.17e) (from Ch. 121 1/2, par. 137.2‑17e) Sec. 2.17e. "Federal 1940 Investment Advisers Act" means the Act of Congress of the United States known as the Investment Advisers Act of 1940, as amended. (Source: P.A. 84‑869.) |
(815 ILCS 5/2.17f) Sec. 2.17f. Federal 1996 Act. "Federal 1996 Act" means the Act of Congress of the United States known as the National Securities Markets Improvement Act of 1996. (Source: P.A. 90‑70, eff. 7‑8‑97.) |
(815 ILCS 5/2.18) (from Ch. 121 1/2, par. 137.2‑18) Sec. 2.18. "Clearing corporation" means a clearing corporation as defined in Section 8‑102 of the Uniform Commercial Code, as amended. (Source: P.A. 79‑1176.) |
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