Substitute House Bill No. 5276
          Substitute House Bill No. 5276

              PUBLIC ACT NO. 98-177


AN  ACT  CONCERNING  TECHNICAL  REVISIONS  TO  THE
BANKING LAW OF CONNECTICUT AND THE SECURITIES  AND
BUSINESS INVESTMENTS LAW OF CONNECTICUT.


    Be  it  enacted  by  the  Senate  and House of
Representatives in General Assembly convened:
    Section  1.  Section  36a-275  of  the general
statutes, as amended by section 1  of  public  act
97-35,   is   repealed   and   the   following  is
substituted in lieu thereof:
    (a) As used  in  this  section, the term "debt
securities" means (1)  any  marketable  obligation
evidencing indebtedness of  any person in the form
of direct, assumed  or  guaranteed bonds, notes or
debentures    commonly   known    as    investment
securities;  (2)  any   obligation  identified  by
certificates  of  participation   in   investments
described in subdivision (1) of [subsection (a) of
this  section]  THIS   SUBSECTION   in   which   a
Connecticut bank could  invest  directly;  or  (3)
repurchase agreements and  the  term  "debt mutual
fund" means a  partnership  interest in, shares of
stock of, units of beneficial interest in or other
ownership interest in  any  one investment company
registered under the  Investment  Company  Act  of
1940,  as from  time  to  time  amended,  commonly
described as mutual  funds,  money  market  funds,
investment trusts or business trusts, provided the
portfolios of such  investment  companies  consist
solely of investments described in subdivision (1)
of  [subsection  (a)   of   this   section]   THIS
SUBSECTION.
    Sec.   2.   Section  36a-316  of  the  general
statutes  is  repealed  and   the   following   is
substituted in lieu thereof:
    As   used  in  sections  36a-315  to  36a-323,
inclusive:
    (1)   "Annual   percentage   yield"   means  a
percentage rate reflecting  the  total  amount  of
interest  paid  on  funds  in  a  deposit  account
calculated in compliance with the Federal Truth in
Savings Act, Subtitle F of Title II of the Federal
Deposit Insurance Corporation Improvement  Act  of
1991,  Public  Law  102-242,  and  the regulations
promulgated  thereunder,  as  from  time  to  time
amended.
    (2)  "Deliver"  means  deliver  in  person  or
place in the United States mail with  first  class
postage properly affixed.
    (3)   "Deposit"   means  any  demand  deposit,
savings deposit or club deposit, any deposit  into
a   time   account   as  defined  in  [subsection]
SUBDIVISION (18) of this section, and the  payment
on  a  share or time share at a Connecticut credit
union or federal credit union.
    (4)  "Deposit  account" means any account at a
financial institution into which a deposit is made
(A)  which  is  in the name of one or more natural
persons; (B) in which,  with  regard  to  a  trust
account, the entire beneficial interest is held by
one or more natural persons, and  (C)  into  which
deposits  may  be made. "Deposit account" does not
include a general or limited  partnership  account
or a sole proprietorship business account.
    (5)  "Deposit  contract"  means  the  contract
between a financial institution  and  a  depositor
that  sets forth the terms, conditions, duties and
obligations relating to a deposit account.
    (6)  "Deposit  account  charge" means a charge
which may be imposed on a depositor for  utilizing
the   services   of  a  financial  institution  in
connection with a  deposit  account,  including  a
charge  for:  (A)  Stop  payment orders; (B) items
drawn on a deposit account which  are  dishonored;
(C)  providing  the  depositor  with a copy of any
record relating to a deposit account; (D) the  use
of  checks, negotiable orders of withdrawal, share
drafts or other items, devices or methods that may
be used to withdraw moneys from a deposit account;
and (E) maintaining a deposit account, such  as  a
service charge.
    (7)  "Deposit  account  disclosures" means the
following information with  regard  to  a  deposit
account:  (A)  The  interest rate, if any, paid on
funds deposited in the  account;  (B)  the  annual
percentage  yield, if any, paid on funds deposited
in the  account;  (C)  the  frequency  with  which
interest will be compounded and the frequency with
which interest will be credited  to  the  account;
(D)  the minimum amount which must be deposited in
such account to open such account; (E) the minimum
balance,  if  any, that must be maintained to earn
the annual percentage yield; and (F) any condition
relating  to  maintenance of a minimum balance for
any part of the earning  period  which  may  cause
interest not to be credited to such account at the
end of the earning period.
    (8)   Except   as   provided  in  [subsection]
SUBDIVISION (4) of  section  36a-323,  "depositor"
means  any  natural person who is legally entitled
to make withdrawals or sell shares from a  deposit
account  at  a financial institution regardless of
whether  a  penalty  may  be  imposed   for   such
withdrawal or sale.
    (9)  "Earning  period" means the period during
which interest accrues and at  the  end  of  which
accrued  interest is credited to a savings or time
account.
    (10)  "Financial  institution" means any bank,
Connecticut credit union or federal credit union.
    (11)   "Interest"   means  any  payment  to  a
depositor or to a deposit account for the  use  of
funds   in   a   deposit  account,  calculated  by
application of a periodic  rate  to  the  balance.
"Interest" does not include the payment of a bonus
or other consideration worth ten dollars  or  less
given  during a year, the waiver or reduction of a
fee, or the absorption of expenses.
    (12)  "Interest rate" means the annual rate of
interest paid on a deposit account which does  not
reflect  compounding.  For the purposes of deposit
account disclosures,  the  interest  rate  may  be
referred  to  as  the  "annual percentage rate" in
addition to being referred  to  as  the  "interest
rate".
    (13)  "Office" of a financial institution does
not include an automated teller machine  or  point
of sale terminal.
    (14)   "Passbook   savings  account"  means  a
savings account in which the depositor  retains  a
book  or  other  document  in  which the financial
institution records transactions  on  the  savings
account.
    (15)  "Periodic  statement"  means a statement
setting forth information about a deposit account,
other  than  a  time  account  or passbook savings
account, that is provided  to  a  depositor  on  a
regular basis four or more times a year.
    (16)   "Post"   means  to  post  or  otherwise
provide notice in a location so that  such  notice
is easily visible to depositors. With regard to an
office at  which  a  financial  institution  lacks
access  to  space  for posting notices, such as an
office within a retail establishment, "post" means
to make available to any depositor upon request.
    (17)   "Savings   deposit"   means  a  savings
deposit, as defined  in  [subsection]  SUBDIVISION
(54) of section 36a-2, AS AMENDED, and the payment
on shares at a Connecticut credit union or federal
credit union, and a "savings account" is a deposit
account which contains savings deposits.
    (18)   "Time  account"  means  (A)  a  deposit
account with a maturity of at least seven days  in
which  the  depositor  generally  does  not have a
right to make withdrawals for six days  after  the
account  is  opened, unless the deposit is subject
to an early withdrawal penalty of at  least  seven
days'  interest  on  amounts  withdrawn  and (B) a
Connecticut  credit  union  member's  payment   on
shares  which such member agrees in writing not to
withdraw within the time period stated therein  as
described in subsection (g) of section 36a-446.
    Sec.  3.  Subsection (a) of section 36a-412 of
the general statutes, as amended by section  7  of
public  act  97-223, is repealed and the following
is substituted in lieu thereof:
    (a) (1) Any  out-of-state bank, whether or not
owned or controlled  by  an  out-of-state  holding
company,   may,   with   the   approval   of   the
commissioner, merge or consolidate with or acquire
a branch or  significant part of the assets or ten
per cent or  more  of the stock of a bank provided
such bank has  been  in existence and continuously
operating for at  least  five  years,  unless  the
commissioner waives this  requirement,  where  the
institution  resulting from  any  such  merger  or
consolidation is an  out-of-state  bank,  provided
the laws of  the  home  state of such out-of-state
bank   authorize,   under   conditions   no   more
restrictive than those imposed by the laws of this
state as determined by the commissioner, a bank to
merge or consolidate  with or purchase a branch or
significant part of  the assets or ten per cent or
more of the  stock  of  an out-of-state bank whose
home   state   is   such   state.   Such   merger,
consolidation or acquisition  shall not take place
if the out-of-state  bank,  including  all insured
depository institutions which  are  affiliates  of
the out-of-state bank,  upon  consummation  of the
merger,   consolidation  or   acquisition,   would
control thirty per  cent  or  more  of  the  total
amount   of   deposits   of   insured   depository
institutions   in   this    state,    unless   the
commissioner permits a  greater percentage of such
deposits.  Any  such   merger,   consolidation  or
acquisition of assets  or  stock shall be effected
in  accordance with  and  subject  to  the  filing
requirements and any  limitations  imposed  by the
laws  of  this  state  with  respect  to  mergers,
consolidations and acquisitions between banks. Any
such out-of-state bank that engages in business in
this state shall  comply  with the requirements of
section [33-396] 33-920, AS AMENDED, or subsection
(a)  of  section   33-1210,   AS  AMENDED.  Before
approving  any  such   merger,   consolidation  or
acquisition,  the  commissioner  shall  make  such
considerations,  determinations  and  findings  as
required by the laws of this state with respect to
mergers, consolidations and  acquisitions  between
banks and, in  addition,  shall  consider  whether
such  merger,  consolidation  or  acquisition  can
reasonably be expected  to produce benefits to the
public and whether  such benefits clearly outweigh
possible  adverse  effects,   including,  but  not
limited to, an  undue  concentration  of resources
and   decreased   or   unfair   competition.   The
commissioner  shall  not   approve   such  merger,
consolidation    or   acquisition    unless    the
commissioner considers whether: (A) The investment
and lending policies  of the out-of-state bank, in
the case of  a merger or acquisition of assets, or
the proposed investment  and  lending  policies of
the bank, in  the case of an acquisition of stock,
or of the  institution  that  will  result  from a
consolidation, are consistent  with safe and sound
banking practices and  will benefit the economy of
this state; (B) the services of the bank or branch
to be acquired,  or  of  the institution that will
result from a  merger, or the proposed services of
the   institution  that   will   result   from   a
consolidation, are consistent  with safe and sound
banking practices and  will benefit the economy of
this  state;  (C)  the  merger,  consolidation  or
acquisition   will   not    substantially   lessen
competition in the banking industry of this state;
(D) in the  case  of  a merger or consolidation or
the acquisition of twenty-five per cent or more of
such  stock,  the   out-of-state   bank   (i)  has
sufficient  capital  to   ensure,  and  agrees  to
ensure,  that the  bank  to  be  acquired  or  the
institution that will  result  from  the merger or
consolidation will comply  with applicable minimum
capital  requirements,  and  (ii)  has  sufficient
managerial resources to  operate  the  bank  to be
acquired or the  institution that will result from
the merger or  consolidation  in  a safe and sound
manner;  and  (E)  the  out-of-state  bank  is  in
compliance   with   applicable   minimum   capital
requirements. The commissioner  shall  not approve
such merger, consolidation  or  acquisition unless
the commissioner makes  the  findings  required by
section 36a-34, AS  AMENDED. Any out-of-state bank
that merges or  consolidates  with  or  acquires a
branch pursuant to  this subdivision may establish
additional branches in  this  state  in accordance
with section 36a-145.
    (2)   Any  out-of-state  bank,  other  than  a
foreign  bank,  may,  with  the  approval  of  the
commissioner,   and   in   accordance   with   the
provisions of this  subdivision,  establish  a  de
novo  branch  in  this state, provided the laws of
the  home  state   of   such   out-of-state   bank
authorize,  under  conditions  no more restrictive
than those imposed by the laws of this  state,  as
determined   by   the   commissioner,  a  bank  to
establish a de novo branch in the  home  state  of
such  out-of-state  bank.  Any  such establishment
shall be effected in accordance with  and  subject
to  the  filing  requirements  and any limitations
imposed by section 36a-145. Any such  out-of-state
bank  that engages in business in this state shall
comply with the requirements of  section  [33-396]
33-920,  AS  AMENDED, or subsection (a) of section
33-1210, AS AMENDED.  Before  approving  any  such
establishment,  the  commissioner  shall make such
considerations,  determinations  and  findings  as
required  by  section  36a-145  and,  in addition,
shall  consider  whether  such  establishment  can
reasonably  be expected to produce benefits to the
public and whether such benefits clearly  outweigh
possible   adverse  effects,  including,  but  not
limited to, an undue  concentration  of  resources
and   decreased   or   unfair   competition.   The
commissioner shall not approve such  establishment
unless the commissioner considers whether: (A) The
investment   and   lending   policies    of    the
out-of-state  bank  are  consistent  with safe and
sound  banking  practices  and  will  benefit  the
economy  of  this state; (B) the proposed services
of the branch are consistent with safe  and  sound
banking  practices and will benefit the economy of
this  state;  (C)  the  establishment   will   not
substantially  lessen  competition  in this state;
(D) the out-of-state bank  is  adequately  managed
and  will  continue  to be adequately managed upon
establishment  of  such  branch;   and   (E)   the
out-of-state bank is in compliance with applicable
minimum  capital  requirements.  The  commissioner
shall  not  approve  such establishment unless the
commissioner  makes  the  findings   required   by
section  36a-34,  AS AMENDED. An out-of-state bank
which has established a de  novo  branch  in  this
state  in  accordance  with  this  subdivision may
establish additional branches  in  this  state  in
accordance with section 36a-145.
    (3)   (A)   As   used   in  this  subdivision,
"applicant" means, in the case of  an  acquisition
of  a branch, the acquiring out-of-state bank, and
in the case of a  merger  or  consolidation,  each
out-of-state bank that is a party to the merger or
consolidation.
    (B)   Any  out-of-state  bank,  regardless  of
whether it has a branch in this state,  may  merge
or  consolidate  with  or acquire a branch in this
state of an out-of-state bank that has a branch in
this  state.  On  or  before June 1, 1997, no such
merger, consolidation or  acquisition  shall  take
place  without  the  approval of the commissioner.
The commissioner shall not  approve  such  merger,
consolidation    or    acquisition    unless   the
commissioner considers whether: (i)  Such  merger,
consolidation  or  acquisition  can  reasonably be
expected to produce benefits  to  the  public  and
whether  such  benefits  clearly outweigh possible
adverse effects including, but not limited to,  an
undue  concentration  of  resources,  decreased or
unfair competition, branch closings  and  loss  of
jobs  in  this state; (ii) the proposed investment
and  lending  policies   and   services   of   the
applicant,  in  the  case  of  an acquisition of a
branch, or the resulting out-of-state bank, in the
case  of  a  merger or consolidation, will benefit
the economy of this state; and (iii) the applicant
has  a  record of compliance with the requirements
of the Community Reinvestment Act of 1977, 12  USC
2901,  et  seq.,  as  from  time  to time amended,
sections  36a-30  to  36a-33,  inclusive,  to  the
extent   applicable,   and   applicable   consumer
protection  laws.  The  commissioner   shall   not
approve  such merger, consolidation or acquisition
unless the commissioner finds that the  applicant,
in  the case of an acquisition of a branch, or the
resulting out-of-state bank,  in  the  case  of  a
merger  or  consolidation,  will  provide adequate
services  to  meet  the  banking  needs   of   all
community    residents,    including    low-income
residents and moderate-income  residents,  to  the
extent  permitted  by  its  charter, in accordance
with a plan submitted  by  the  applicant  to  the
commissioner  in  such  form  and  containing such
information as  the  commissioner  requires.  Upon
receiving  the  plan,  the commissioner shall make
the  plan  available  for  public  inspection  and
comment  at  the  Department  of Banking and shall
cause notice of its  submission  and  availability
for  inspection and comment to be published in the
department's weekly bulletin. With the concurrence
of  the commissioner, the applicant shall publish,
in  the  form  of  a  legal  advertisement  in   a
newspaper  having a substantial circulation in the
area,  notice  of  such  plan's   submission   and
availability  for  public  inspection and comment.
The notice shall state  that  the  inspection  and
comment  period  will  last for a period of thirty
business days from the date  of  publication.  The
commissioner shall not make such finding until the
expiration of such thirty-day  period.  In  making
such   finding,  the  commissioner  shall,  unless
clearly  inapplicable,   consider,   among   other
factors,  whether  the  plan  identifies  specific
unmet credit and consumer  banking  needs  in  the
local  community and specifies how such needs will
be satisfied, provides for sufficient distribution
of  banking  services  among branches or satellite
devices,   or   both,   located   in    low-income
neighborhoods,  contains  adequate assurances that
banking   services   will   be   offered   on    a
nondiscriminatory   basis   and   demonstrates   a
commitment to extend  credit  for  housing,  small
business   and  consumer  purposes  in  low-income
neighborhoods. Any such merger,  consolidation  or
acquisition  which  received  all required federal
bank regulatory approvals on or before February 7,
1996,  shall  not  be  subject to the approval and
filing requirements of this subdivision.
    (4)  (A)  Except  as provided in this section,
any branch in this state of an out-of-state  bank,
other   than  a  federally-chartered  out-of-state
bank, may exercise all the powers possessed  by  a
Connecticut  bank and the laws of this state shall
apply to such branch to the same  extent  as  such
laws  apply to a branch of a Connecticut bank, and
such  out-of-state  bank  may  not   conduct   any
activity  at  such  branch that is not permissible
for a Connecticut bank. The following  laws  shall
not  apply  to  such  branch:  Sections 36a-65, AS
AMENDED, 36a-98,  36a-261,  36a-262,  36a-285,  AS
AMENDED,  unless,  at the time of the acquisition,
the acquired bank exercised the authority  granted
by  such  section,  36a-738  and  36a-739.  If the
commissioner determines  that  a  branch  in  this
state  of such out-of-state bank is being operated
in violation of any applicable law of  this  state
or   in   an   unsafe   and  unsound  manner,  the
commissioner  may  take  any  enforcement   action
authorized   under   this   title   against   such
out-of-state bank to the same extent  as  if  such
branch  were  a  Connecticut  bank,  provided, the
commissioner shall promptly give  notice  of  such
action to the home state banking regulator of such
out-of-state bank and, to the extent  practicable,
shall consult and cooperate with such regulator in
pursuing and resolving such action.
    (B)  The laws of this state shall apply to any
branch in  this  state  of  a  federally-chartered
out-of-state  bank to the same extent as such laws
would apply if the branch were a federal bank. The
following  laws  shall apply to any branch in this
state of a federally-chartered  out-of-state  bank
to  the same extent as such laws apply to a branch
of a Connecticut bank: (i) Community  reinvestment
laws   including   sections   36a-30   to  36a-33,
inclusive, (ii) consumer protection laws including
sections   36a-290   to   36a-304,  inclusive,  AS
AMENDED, 36a-306,  36a-307,  36a-315  to  36a-323,
inclusive,   36a-645  to  36a-647,  inclusive,  AS
AMENDED, 36a-690, 36a-695 to  36a-700,  inclusive,
AS AMENDED, 36a-705 to 36a-707, inclusive, 36a-715
to 36a-718, inclusive, 36a-725,  36a-726,  36a-755
to   36a-759,   inclusive,   36a-770  to  36a-788,
inclusive,  and  36a-800  to  36a-810,  inclusive,
(iii) fair lending laws including sections 36a-16,
36a-737, 36a-740 and 36a-741, and  (iv)  branching
laws including sections 36a-23 and 36a-145.
    (5)  Any  out-of-state  bank  that  merges  or
consolidates with or acquires the assets of a bank
or  establishes  in  this  state  a de novo branch
shall  be   subject   to   the   supervision   and
examination   of   the  commissioner  pursuant  to
regulations  adopted  by   the   commissioner   in
accordance  with chapter 54 and shall make reports
to the commissioner as required  by  the  laws  of
this  state.  The  commissioner  may  examine  and
supervise the Connecticut  branches  of  any  such
out-of-state  bank  and  may enter into agreements
with other state or federal banking regulators  or
similar regulators in a foreign country concerning
such examinations or supervision.  The  provisions
of  this  section  apply to the acquisition of the
assets of any bank from the receiver of such  bank
by any out-of-state bank.
    Sec.  4.  Subsection (a) of section 36a-425 of
the general statutes is repealed and the following
is substituted in lieu thereof:
    (a)  Except  as  otherwise  provided  in  this
title,  no  foreign  banking   corporation   shall
transact  in this state the business authorized by
its certificate of incorporation or by the laws of
the  state  under  which  it was organized, unless
empowered to do so by any provision of the general
statutes   or  any  special  act  of  this  state;
provided, without excluding other activities which
may  not  constitute  transacting business in this
state, no such foreign banking  corporation  shall
be  deemed  to be doing or transacting business in
this state for purposes of this section by  reason
of  its  acting  as  an  investment adviser to the
State Treasurer or by reason of its  making  loans
whether secured or unsecured. For purposes of this
section, "foreign  banking  corporation"  means  a
banking  corporation  which is organized under the
laws of or has its principal office in  any  state
other  than  Connecticut  or  any foreign country.
Notwithstanding the provisions of this subsection,
a  foreign  banking  corporation  which  transacts
business in this state for the purposes of section
33-920, AS AMENDED, or [subsection (a) of] section
33-1210,  AS  AMENDED,  shall  comply   with   the
requirements  of [such sections] SUBSECTION (a) OF
SECTION  33-920  OR  SUBSECTION  (a)  OF   SECTION
33-1210.
    Sec.   5.   Section  36a-695  of  the  general
statutes  is  repealed  and   the   following   is
substituted in lieu thereof:
    As  used  in  sections  36a-695  to  [36a-699]
36a-699e,  inclusive,  AS  AMENDED,   unless   the
context otherwise requires:
    (1)  "Consumer"  means  an  individual seeking
credit for personal, family or household purposes;
    (2)  "Creditor"  means  any person who extends
credit in the ordinary course of business;
    (3)  "Credit report" means any written or oral
report,  recommendation  or  representation  of  a
credit  rating agency as to the credit worthiness,
credit  standing,  or  credit  capacity   of   any
consumer,  and  includes  any information which is
sought or given for the purpose of serving as  the
basis for determining eligibility for credit to be
used primarily for personal, family  or  household
purposes;
    (4)  "Credit  rating  agency" means any person
whose business is the assembling and evaluating of
information  as  to the credit standing and credit
worthiness of a  consumer,  for  the  purposes  of
furnishing  credit  reports, for monetary fees and
dues to third parties.
    Sec.   6.   Section   36b-3   of  the  general
statutes, as amended by section 1  of  public  act
97-220,   is   repealed   and   the  following  is
substituted in lieu thereof:
    As   used   in   sections   36b-2  to  36b-33,
inclusive,  AS   AMENDED,   unless   the   context
otherwise requires:
    (1)  "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
(A) effecting transactions in a security  exempted
by subdivision (1), (2), (3), (4), (6), (9), (10),
(11) or (21) of subsection (a) of section  36b-21,
AS AMENDED, (B) effecting transactions exempted by
subsection (b)  of  section  36b-21,  AS  AMENDED,
except  for  transactions exempted by subdivisions
(9),  (12)  or  (13)  of  said   subsection,   (C)
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 (D) effecting transactions in
any   covered   security,   except   for   covered
securities within the meaning of Sections 18(b)(2)
or 18(b)(4)(D) of  the  Securities  Act  of  1933.
"Agent"  does  not  include such other persons not
within the intent of this [subsection] SUBDIVISION
as  the  commissioner  may  by regulation or order
determine. A general partner, officer or  director
of   a   broker-dealer  or  issuer,  or  a  person
occupying a similar status or  performing  similar
functions,  is an agent only if he otherwise comes
within this definition and any  compensation  that
he  receives  is directly or indirectly related to
purchases or sales of securities.
    (2)  "Associated person" has the meaning given
to that term in Section 3(a)(21) of the Securities
Exchange Act of 1934.
    (3)  "Blank  check  company" means any company
that (A) devotes substantially all of its  efforts
to  establishing  a  new business in which planned
principal operations have not commenced  or,  that
has  commenced  planned  principal operations, but
has not derived significant revenue therefrom; and
(B)  has  no  specific business plan or purpose or
has indicated that its business plan is to  engage
in  a  merger  or acquisition with an unidentified
company or companies, or other entity or person.
    (4)  "Branch  office" means any location other
than the main office, identified by any  means  to
the  public, customers or clients as a location at
which  a  broker-dealer  or   investment   adviser
conducts   a  securities  or  investment  advisory
business. "Branch office" does not include  (A)  a
location   identified   solely   in   a  telephone
directory line listing or on a  business  card  or
letterhead if (i) the listing, card, or letterhead
also sets forth the address and  telephone  number
of  a  Connecticut  office of the broker-dealer or
investment   adviser   from   which    individuals
conducting  business from such identified location
are directly supervised, and (ii) no more than one
agent   or   investment  adviser  agent  transacts
business  on  behalf  of  the   broker-dealer   or
investment  adviser from such identified location,
or (B) any other location not within the intent of
this  [subsection] SUBDIVISION as the commissioner
may determine.
    (5)  "Broker-dealer"  means any person engaged
in  the  business  of  effecting  transactions  in
securities  for  the  account of others or for his
own account. "Broker-dealer" does not include  (A)
an  agent,  (B)  an  issuer,  (C) a bank and trust
company, a national banking association, a savings
bank,  a  savings  and loan association, a federal
savings and loan association, a  credit  union,  a
federal  credit  union,  or a trust company, (D) a
person who has no place of business in this  state
if   he   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) a  bank  and  trust
company, a national banking association, a savings
bank, a savings and loan  association,  a  federal
savings  and  loan  association, a credit union, a
federal  credit  union,  a   trust   company,   an
insurance   company,   an  investment  company  as
defined in the Investment Company Act of  1940,  a
pension   or   profit-sharing   trust,   or  other
financial  institution  or  institutional   buyer,
whether  acting  for  itself or as trustee, or (E)
such other persons not within the intent  of  this
[subsection]  SUBDIVISION  as the commissioner may
by regulation or order determine.
    (6)  "Commissioner"  means the Commissioner of
Banking or any person appointed or  designated  by
the Commissioner of Banking to administer sections
36b-2 to 36b-33, inclusive, AS AMENDED.
    (7)  "Covered  security" has the meaning given
to that term in Section 18(b)  of  the  Securities
Act of 1933.
    (8)  "Fraud",  "deceit"  and "defraud" are not
limited to common-law deceit.
    (9)   "Guaranteed"   means  guaranteed  as  to
payment of principal, interest or dividends.
    (10)  "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" does
not include  (A)  a  bank  and  trust  company,  a
national  banking  association,  a savings bank, a
savings and loan association,  a  federal  savings
and  loan  association,  a credit union, a federal
credit union or a trust  company;  (B)  a  lawyer,
accountant, engineer, or teacher whose performance
of these services  is  solely  incidental  to  the
practice  of  his  profession; (C) a broker-dealer
whose performance  of  these  services  is  solely
incidental  to  the  conduct  of his business as a
broker-dealer  and   who   receives   no   special
compensation for them; (D) a publisher of any bona
fide newspaper,  news  magazine,  or  business  or
financial  publication  of  general,  regular, and
paid  circulation;  (E)  a  person  whose  advice,
analyses  or  reports  relate  only  to securities
exempted by subdivision (1) of subsection  (a)  of
section  36b-21,  AS  AMENDED;  (F)  any insurance
company under the  supervision  of  the  Insurance
Commissioner  or any affiliate thereof, as defined
in  subsection  (b)  of  section   38a-129,   when
providing  services  to  separate accounts of that
insurance   company   or   registered   investment
companies  all  of  whose shares are owned by such
insurance  company  or   its   insurance   company
affiliates  or  by  the  separate accounts of that
insurance  company  or   its   insurance   company
affiliates;  and (G) such other persons not within
the intent of this [subsection] SUBDIVISION as the
commissioner may by regulation or order designate.
    (11)  "Investment  adviser agent" includes any
individual, other than an investment adviser, or a
sole   proprietor   of   an   investment  adviser,
employed, appointed or authorized by an investment
adviser  to  solicit  business from any person for
such  investment  adviser,  within  or  from  this
state,  and  who  receives  compensation  or other
remuneration, directly  or  indirectly,  for  such
solicitation.  An  officer, partner or director of
an investment adviser, or an individual  occupying
a  similar status or performing similar functions,
is  an  investment  adviser  agent  only   if   he
otherwise comes within this definition.
    (12)  "Issuer"  means any person who issues or
proposes to issue any security;  except  that  (A)
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,  "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 (B) 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, "issuer" means the
owner of any such title, lease, right or interest,
whether  whole or fractional, who creates or sells
fractional interests therein.
    (13)   "Nonissuer"   means   not  directly  or
indirectly for the benefit of the issuer.
    (14)   "Person"   means   an   individual,   a
corporation,  a  limited  liability   company,   a
partnership,   an   association,   a   joint-stock
company,  a  trust  where  the  interests  of  the
beneficiaries  are  evidenced  by  a  security, an
unincorporated organization,  a  government  or  a
political subdivision of a government.
    (15)  (A)  "Sale"  or  "sell"  includes  every
contract  of  sale  of,  contract  to   sell,   or
disposition  of,  a  security  or  interest  in  a
security for value. (B) "Offer" or "offer to sell"
includes  every attempt or offer to dispose of, or
solicitation of an offer to  buy,  a  security  or
interest in a security for value. (C) Any security
given or delivered with, or as a bonus on  account
of,  any purchase of securities or any other thing
shall be conclusively  presumed  to  constitute  a
part  of  the subject of such purchase and to have
been  sold  for  value.  (D)   Nothing   in   this
[subsection]  SUBDIVISION  shall limit or diminish
the full meaning  of  the  terms  "sale",  "sell",
"offer"  or  "offer  to  sell" as construed by the
courts of this state.  (E)  A  purported  gift  of
assessable stock is considered to involve an offer
and sale. (F) 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 right or privilege to  convert
into  another  security  of  the  same  or another
issuer, is considered to include an offer  of  the
other  security.  (G)  The  terms  defined in this
[subsection] SUBDIVISION do not include:  (i)  Any
bona fide pledge or loan; (ii) 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; (iii) any act incident to a class  vote  by
security   holders   on   a  merger,  exchange  of
securities    for    securities,    consolidation,
reclassification  of securities, or sale of assets
in consideration of the issuance of securities  or
securities  and  cash of another person other than
an individual;  or  (iv)  any  security  which  is
issued  in  exchange  for  one  or  more bona fide
outstanding   securities,   claims   or   property
interests,  or  partly in such exchange and partly
for cash, where the terms and conditions  of  such
issuance and exchange are approved by any state or
federal court.
    (16)  "Securities  Act  of  1933", "Securities
Exchange Act of  1934",  "Public  Utility  Holding
Company  Act of 1935", "Investment Advisers Act of
1940" and "Investment Company Act  of  1940"  mean
the  federal statutes of those names, as from time
to time amended.
    (17)   "Security"   means   any  note,  stock,
treasury  stock,  bond,  debenture,  evidence   of
indebtedness,    certificate    of   interest   or
participation  in  any  profit-sharing  agreement,
interests   of   limited  partners  in  a  limited
partnership,     collateral-trust     certificate,
preorganization   certificate   or   subscription,
transferable    share,    investment     contract,
voting-trust  certificate,  certificate of deposit
for  a  security,  certificate  of   interest   or
participation  in  an  oil, gas 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" does
not  include  any insurance or endowment policy or
annuity contract issued by  an  insurance  company
which  is  subject  to regulation by the Insurance
Commissioner.
    (18)  "Shell  company"  or  "dormant  company"
means any company which does not  pursue  nor  has
the  financial  capacity to pursue a business plan
or purpose.
    (19)  "State"  means  any  state, territory or
possession of the United States, the  District  of
Columbia and Puerto Rico.
    Sec.   7.   Section  42-100b  of  the  general
statutes  is  repealed  and   the   following   is
substituted in lieu thereof:
    As  used  in  section  42-100c, "retail credit
transaction" includes any agreement or transaction
for the retail sale of goods or services which are
used or bought primarily for personal,  family  or
household  purposes,  but  [it]  does  not include
transactions covered by chapter 4 of the  Consumer
Credit  Protection  Act,  [as  defined  in section
36a-676] 15 USC 1666 ET SEQ., AS FROM TIME TO TIME
AMENDED.

Approved June 4, 1998