MISSISSIPPI LEGISLATURE

1997 Regular Session

To: Judiciary A

By: Representative Perry

AN ACT TO REVISE THE MISSISSIPPI SECURITIES ACT; TO AMEND SECTION 75-71-105, MISSISSIPPI CODE OF 1972, TO REVISE THE DEFINITIONS; TO AMEND SECTION 75-71-109, MISSISSIPPI CODE OF 1972, TO REVISE THE AUTHORITY OF THE SECRETARY OF STATE TO CARRY OUT THE PROVISIONS OF THE CHAPTER; TO AMEND SECTION 75-71-113, MISSISSIPPI CODE OF 1972, TO CLARIFY WHAT SECURITIES REQUIRE THE FILING OF SALES AND ADVERTISING LITERATURE; TO AMEND SECTION 75-71-119, MISSISSIPPI CODE OF 1972, TO REVISE WHAT SECTIONS OF THE CHAPTER APPLY TO OFFERS TO BUY OR SELL IN THIS STATE; TO AMEND SECTION 75-71-303, MISSISSIPPI CODE OF 1972, TO REVISE THE REGISTRATION OF INVESTMENT ADVISERS AND INVESTMENT ADVISER REPRESENTATIVES; TO AMEND SECTION 75-71-305, MISSISSIPPI CODE OF 1972, TO CLARIFY THE EXPIRATION OF REGISTRATION; TO AMEND SECTION 75-71-307, MISSISSIPPI CODE OF 1972, TO CLARIFY THAT FEDERAL COVERED ADVISERS SHALL FILE WITH THE SECRETARY OF STATE; TO AMEND SECTION 75-71-313, MISSISSIPPI CODE OF 1972, TO REVISE THE REGISTRATION FEES; TO AMEND SECTION 75-71-317, MISSISSIPPI CODE OF 1972, TO REVISE THE MINIMUM CAPITAL RULES; TO AMEND SECTION 75-71-319, MISSISSIPPI CODE OF 1972, TO REVISE THE TERMS AND CONDITIONS OF SURETY BONDS; TO AMEND SECTION 75-71-333, MISSISSIPPI CODE OF 1972, TO REVISE THE POST-REGISTRATION REQUIREMENTS; TO AMEND SECTION 75-71-401, MISSISSIPPI CODE OF 1972, TO REVISE THE EXEMPTIONS TO REGISTRATION; TO CODIFY SECTION 75-71-408, MISSISSIPPI CODE OF 1972, TO COVER THE FILING OF FEDERAL COVERED SECURITIES; TO AMEND SECTION 75-71-409, MISSISSIPPI CODE OF 1972, TO REVISE THE FILING FEES; TO AMEND SECTION 75-71-421, MISSISSIPPI CODE OF 1972, TO REVISE THE OFFERING OF CERTAIN FEDERAL COVERED SECURITIES; TO AMEND SECTION 75-71-701, MISSISSIPPI CODE OF 1972, TO CLARIFY SERVICE OF PROCESS; AND FOR RELATED PURPOSES. 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 75-71-105, Mississippi Code of 1972, is amended as follows:

75-71-105. For the purposes of this chapter the following words shall have the following meanings unless the context shall prescribe otherwise:

(a) "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 (1) an issuer in: * * * (A) effecting transactions in a security exempted by clause (1), (2), (3), (10) or (11) of Section 75-71-201; (B) effecting transactions exempted by Section 75-71-203; * * * (C) effecting transactions in a covered security as described in Section 18(b)(3) and 18(b)(4)(D) of the Securities Act of 1933; or (D) 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 (2) a broker-dealer in effecting transactions in this state limited to those transactions described in Section 15(h)(2) of the Securities Exchange Act of 1934. A 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.

(b) "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 (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 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 (12) consecutive months he does not direct more than fifteen (15) offers to sell or buy into the State of Mississippi in any manner to persons other than those specified in clause (A) of this subsection, whether or not the offeror or any of the offerees is then present in this state.

(c) "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 adviser" under Section 202(a)(11) of the Investment Advisers Act of 1940, except that, until October 10, 1999, a federal covered adviser for which a nonpayment or underpayment of a fee has not been promptly remedied following written notification to the adviser of such nonpayment or underpayment shall not be a federal covered adviser.

(d) "Federal covered security" means any security that is a covered security under Section 18(b) of the Securities Act of 1933 or rules or regulations promulgated thereunder, except, up through October 10, 1999, or such other date as may be legally permissible, a federal covered security for which a fee has not been paid and promptly remedied following written notification from the Secretary of State to the issuer of the nonpayment or underpayment of such fees, as required by this chapter, shall not be a federal covered security.

(e) "Fraud," "deceit" and "defraud" are not limited to common-law deceit.

(f) "Guaranteed" means guaranteed as to payment of principal, interest or dividends.

(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" does not include (1) an investment adviser representative; (2) a bank, savings institution or trust company; (3) a lawyer, accountant, engineer or teacher whose performance of these services is solely incidental to the practice of his profession; (4) a broker-dealer or his agent 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; (5) a publisher of any bona fide newspaper, news magazine or business or financial publication of general, regular and paid circulation; (6) a person whose advice, analyses or reports relate only to securities exempted by Section 75-71-201(1); (7) a person who is a federal covered adviser; (8) a person who has no place of business in this state if (A) his only clients in this state are other investment advisers, federal covered advisers, broker-dealers, banks, savings institutions, trust companies, insurance companies, investment companies as defined in the Investment Company Act of 1940, employee benefit plans with assets of not less than One Million Dollars ($1,000,000.00), governmental agencies or instrumentalities, whether acting for themselves or as trustees with investment control, or other financial institutions or institutional buyers as are designated by rule or order of the Secretary of State, * * * or (B) during the preceding twelve-month period he has had not * * * more than five (5) clients, other than those specified in clause (A) of this subsection, who are residents of * * * this state; or (8) such other persons not within the intent of this subsection as the Secretary of State 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 * * * 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, or (5) supervises employees who perform any of the foregoing.

(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 evidenced 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.

(2) "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.

(3) Any security given or delivered with, or 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 right or privilege to convert into another security of the same or another issuer, is considered to include an offer of the other security.

(6) The terms defined in this subsection 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 or after the effective date of this chapter.

(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; 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; interest in a limited partnership; 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 under which an insurance company promises to pay a fixed or variable sum of money, or both, either in a lump sum or periodically for life or some other specified period.

(o) "State" means any state, territory or possession of the United States, the District of Columbia and Puerto Rico.

SECTION 2. Section 75-71-109, Mississippi Code of 1972, is amended as follows:

75-71-109. (a) The Secretary of State may from time to time make, amend and rescind such rules, forms and orders as are necessary to carry out the provisions of this chapter, including rules and forms governing registration statements, fees, applications and reports, and defining any terms, whether or not used in this chapter, insofar as the definitions are not inconsistent with the provisions of this chapter. For the purpose of rules and forms, the Secretary of State may classify securities, persons and matters within his jurisdiction, and prescribe different requirements for different classes. The Secretary of State may by rule adopt exemptions from the registration requirements of Sections 75-71-301 and 75-71-401 where such exemptions are consistent with the public interest and with the purpose fairly intended by the policy and provisions of this chapter.

(b) No rule, form or order may be made, amended or rescinded unless the Secretary of State finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of this chapter. In prescribing rules and forms the Secretary of State may cooperate with the securities administrators of the other states and the securities and exchange commission with a view to effectuating the policy of this chapter to achieve maximum uniformity in the form and content of registration statements, applications and reports wherever practicable.

(c) The Secretary of State may by rule or order prescribe (1) the form and content of financial statements required under this chapter, (2) the circumstances under which consolidated financial statements shall be filed, and (3) whether any required financial statements shall be certified by independent or certified public accountants. All financial statements shall be prepared in accordance with generally accepted accounting practices.

(d) All rules and forms of the Secretary of State shall be published.

(e) No provision of this chapter imposing any liability applies to any act done or omitted in good faith in conformity with any rule, form or order of the Secretary of State, notwithstanding that the rule, form or order may later be amended or rescinded or be determined by judicial or other authority to be invalid for any reason.

(f) Every hearing in an administrative proceeding shall be public unless the Secretary of State in his discretion grants a request joined in by all the respondents that the hearing be conducted privately.

SECTION 3. Section 75-71-113, Mississippi Code of 1972, is amended as follows:

75-71-113. The Secretary of State by rule or order may require the filing of any prospectus, pamphlet, circular, form letter, advertisement, or other sales literature or advertising communication addressed or intended for distribution to prospective investors, including clients or prospective clients of an investment adviser, unless the security or transaction is exempted under Article 3 of this chapter or is a federal covered security.

SECTION 4. Section 75-71-119, Mississippi Code of 1972, is amended as follows:

75-71-119. (a) Sections 75-71-117, 75-71-301(a), 75-71-401, 75-71-408, 75-71-501 and 75-71-717 through 75-71-731 apply to persons who sell or offer to sell when (1) an offer to sell is made in this state, or (2) an offer to buy is made and accepted in this state.

(b) Sections 75-71-117, 75-71-301(a) and 75-71-501 apply to persons who buy or offer to buy when (1) an offer to buy is made in this state, or (2) an offer to sell is made and accepted in this state.

(c) For the purpose of this section, an offer to sell or to buy is made in this state, whether or not either party is then present in this state, when the offer (1) originates from this state, or (2) is directed by the offeror to this state and received at the place to which it is directed (or at any post office in this state in the case of a mailed offer).

(d) For the purpose of this section, an offer to buy or to sell is accepted in this state when acceptance (1) is communicated to the offeror in this state and (2) has not previously been communicated to the offeror, orally or in writing, outside this state; and acceptance is communicated to the offeror in this state, whether or not either party is then present in this state, when the offeree directs it to the offeror in this state reasonably believing the offeror to be in this state, and it is received at the place to which it is directed (or at any post office in this state in the case of a mailed acceptance).

(e) An offer to sell or to buy is not made in this state when (1) the publisher circulates or there is circulated on his behalf in this state any bona fide newspaper or other publication of general, regular and paid circulation which is not published in this state, or which is published in this state but has had more than two-thirds (2/3) of its circulation outside this state during the past twelve (12) months, or (2) a radio or television program originating outside this state is received in this state.

(f) Sections 75-71-117 and 75-71-303, as well as Section 75-71-503, so far as investment advisers and investment adviser representatives are concerned, apply when any act instrumental in effecting prohibited conduct is done in this state, whether or not either party is then present in this state.

SECTION 5. Section 75-71-303, Mississippi Code of 1972, is amended as follows:

75-71-303. (a) It is unlawful for any person to transact business in this state as an investment adviser or as an investment adviser representative unless (1) he is so registered under this chapter; or (2) he is registered as a broker-dealer or an agent of a broker-dealer * * *.

(b) It is unlawful for any: (1) person required to be registered as an investment adviser under this chapter to employ an investment adviser representative unless the investment adviser representative is registered under this chapter, provided that the registration of an investment adviser representative is not effective during any period when he is not employed by an investment adviser registered under this chapter; or (2) federal covered adviser to employ, supervise or associate with an investment adviser representative having a place of business located in this state, unless such investment adviser representative is registered under this chapter or is exempt from registration. When an investment adviser representative begins or terminates employment with an investment adviser, the investment adviser, in the case of Section 75-71-303(b)(1), or the investment adviser representative in the case of Section 75-71-303(b)(2), shall promptly notify the Secretary of State.

SECTION 6. Section 75-71-305, Mississippi Code of 1972, is amended as follows:

75-71-305. Every registration or notice filing shall expire on the thirty-first day of December in every year unless renewed.

SECTION 7. Section 75-71-307, Mississippi Code of 1972, is amended as follows:

75-71-307. A broker-dealer, agent, investment adviser or investment adviser representative may obtain an initial or renewal registration by filing with the Secretary of State or his designee an application, together with a consent to service of process pursuant to Section 75-71-701. The application shall contain whatever information the Secretary of State by rule requires concerning such matters as (1) the applicant's form and place of organization; (2) the applicant's proposed method of doing business; (3) the qualifications and business history of the applicant; in the case of a broker-dealer or investment adviser, the qualifications and business history of any partner, officer or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the broker-dealer or investment adviser; (4) any injunction or administrative order or conviction of a misdemeanor involving a security or any aspect of the securities business and any conviction of a felony; and (5) the applicant's financial condition and history.

Except with respect to advisers whose only clients are those described in Section 75-71-105(g)(8) of this chapter, it is unlawful for any federal covered adviser to conduct advisory business in this state unless, prior to acting as a federal covered adviser in this state, such person files such documents as have been filed with the United States Securities and Exchange Commission with the Secretary of State, as the Secretary of State may by rule or otherwise require, and a fee and consent to service of process, as the Secretary of State, by rule or otherwise, may require.

SECTION 8. Section 75-71-313, Mississippi Code of 1972, is amended as follows:

75-71-313. (a) Every applicant for initial or renewal registration shall pay a registration fee as required by the Secretary of State in the case of a broker-dealer or agent.

(b) Every applicant for initial or renewal registration as an investment adviser or as an investment adviser representative who is subject to registration under this act shall pay a registration fee as required by the Secretary of State.

(c) Every person acting as a federal covered adviser in this state shall pay an initial and renewal notice filing fee as required by the Secretary of State.

SECTION 9. Section 75-71-317, Mississippi Code of 1972, is amended as follows:

75-71-317. The Secretary of State may by rule or otherwise require a minimum capital for registered broker-dealers, subject to the limitations of Section 15 of the Securities and Exchange Act of 1934, and establish minimum financial requirements for investment advisers, subject to the limitations of Section 222 of the Investment Advisers Act of 1940, which may include different requirements for those investment advisers who maintain custody of clients' funds or securities or who have discretionary authority over same and those investment advisers who do not.

SECTION 10. Section 75-71-319, Mississippi Code of 1972, is amended as follows:

75-71-319. (1) The Secretary of State may by rule or otherwise require registered broker-dealers, agents and investment advisers to post * * * bonds, in amounts as he may prescribe, subject to the limitations of Section 15 of the Securities Exchange Act of 1934 (for broker-dealers) and Section 222 of the Investment Advisers Act of 1940 (for investment advisers), and may determine their condition.

(2) Every bond shall provide that no suit may be maintained to enforce any liability on the bond unless brought within two (2) years after the sale or other act upon which it is based, except that if the person entitled to bring such suit shall die before the expiration of the time herein limited therefor, such suit may be commenced by the executor or administrator of the deceased person after the expiration of such time but within one (1) year after the death of such person.

SECTION 11. Section 75-71-333, Mississippi Code of 1972, is amended as follows:

75-71-333. (a) Books and accounts. Every registered broker-dealer and investment adviser shall make and keep such accounts, correspondence, memoranda, papers, books and other records as the Secretary of State * * * prescribes by rule or otherwise, not to exceed the limitations provided in Section 15 of the Securities Exchange Act of 1934 (in the case of a broker-dealer) and Section 222 of the Investment Advisers Act of 1940 (in the case of an investment adviser). All records so required, with respect to a registered investment adviser, shall be preserved for such period as the Secretary of State * * * prescribes by rule or otherwise.

(b) Financial reports. Every registered broker-dealer and investment adviser shall file such financial reports as the Secretary of State * * * prescribes by rule or otherwise, not to exceed the limitations provided in Section 15 of the Securities Exchange Act of 1934 (in the case of a broker-dealer) and Section 222 of the Investment Advisers Act of 1940 (in the case of an investment adviser).

(c) Corrections. If the information contained in any document filed with the Secretary of State is or becomes inaccurate or incomplete in any material respect, the registrant or federal covered adviser shall promptly file a correcting amendment if the document is filed with respect to a registrant or when such amendment is required to be filed with the United States Securities and Exchange Commission if the document is filed with respect to a federal covered adviser, unless notification of the correction has been given under Section 75-71-301.

(d) Inspection Power. All of the records referred to in subsection (a) of this section are subject at any time to such reasonable periodic, special or other examinations by representatives of the Secretary of State, within or without the State of Mississippi, as the Secretary of State deems necessary or appropriate in the public interest or for the protection of investors.

SECTION 12. Section 75-71-401, Mississippi Code of 1972, is amended as follows:

75-71-401. Except as provided for in Section 75-71-109(a), it is unlawful for any person to offer or sell any security in the State of Mississippi unless (1) it is registered under this chapter, * * * (2) the security or transaction is exempted under Article 3 of this chapter, or (3) it is a federal covered security.

SECTION 13. The following shall be codified as Section 75-71-408, Mississippi Code of 1972:

75-71-408. (a) The Secretary of State, by rule or otherwise, may require the filing of any or all of the following documents with respect to a covered security under Section 18(b)(2) of the Securities Act of 1933:

(1) Prior to the initial offer of such federal covered security in this state, all documents that are part of a federal registration statement filed with the United States Securities and Exchange Commission under the Securities Act of 1933, together with a consent to service of process signed by the issuer and with the filing fee calculated in the manner provided in Section 75-71-409.

(2) After the initial offer of such federal covered security in this state, all documents that are part of an amendment to a federal registration statement filed with the United States Securities and Exchange Commission under the Securities Act of 1933, which shall be filed concurrently with the Secretary of State.

(3) An annual or periodic report of the value of such federal covered securities offered or sold in this state, together with the report fee set forth in Section 75-71-421 and a filing fee calculated in the manner provided in Section 75-71-409.

(b) With respect to any security that is a covered security under Section 18(b)(4)(D) of the Securities Act of 1933, the Secretary of State, by rule or otherwise, may require the issuer to file a notice on SEC Form D and a consent to service of process signed by the issuer no later than fifteen (15) days after the first sale of such covered security in this state, together with a filing fee to be set by rule.

(c) The Secretary of State, by rule or otherwise, may require the filing of any document filed with the United States Securities and Exchange Commission under the Securities Act of 1933, with respect to a covered security under Section 18(b)(3) or (4) of the Securities Act of 1933, together with a filing fee to be set by rule.

(d) The Secretary of State may issue an order suspending the offer and sale of a covered security, except a covered security under Section 18(b)(1) of the Securities Act of 1933, if he finds that: (1) the order is in the public interest and (2) there is a failure to comply with any condition established under this section.

(e) The Secretary of State, by rule or otherwise, may waive any or all of the provisions of this section, except for fees.

SECTION 14. Section 75-71-409, Mississippi Code of 1972, is amended as follows:

75-71-409. At the time the registration * * * of a securities offering or notification of a securities offering pursuant to Section 75-71-408(a) is filed, every person filing such registration or notification shall pay a filing fee of one-tenth of one percent (1/10 of 1%) of the dollar amount to be registered, with the minimum fee to be One Hundred Fifty Dollars ($150.00) and the maximum fee to be One Thousand Dollars ($1,000.00).

When a registration * * * is withdrawn before the effective date or a preeffective stop order is entered under Sections 75-71-425 through 75-71-431, the Secretary of State shall retain the greater of One Hundred Fifty Dollars ($150.00) or forty percent (40%) of the fee.

The Secretary of State may by rule or otherwise set a fee for changing the name of an issuer or offering filed with his office.

SECTION 15. Section 75-71-421, Mississippi Code of 1972, is amended as follows:

75-71-421. So long as a registration statement is effective or an offering of federal covered securities pursuant to Section 75-71-408(a) continues, the Secretary of State may by rule or order require the person who filed the registration statement or notice, as the case may be, to file reports, not more often than quarterly, to keep reasonably current the information contained in the registration statement or notice, as the case may be, and to disclose the progress of the offering. The Secretary of State may by rule assess a fee not to exceed Fifty Dollars ($50.00) to be paid when the required report is filed.

SECTION 16. Section 75-71-701, Mississippi Code of 1972, is amended as follows:

75-71-701. Every applicant for registration under this chapter and every issuer which proposes to offer a security in this state through any person acting on an agency basis in the common-law sense shall file with the Secretary of State, in such form as he by rule prescribes, an irrevocable consent appointing the secretary of state or his successor in office to be his attorney to receive service of any lawful process in any noncriminal suit, action or proceeding against him or his successor, executor or administrator which arises under this chapter or any rule or order hereunder after the consent has been filed, with the same force and validity as if served personally on the person filing the consent. A person who has filed such a consent in connection with a previous registration or notice filing need not file another. Service may be made by leaving a copy of the process in the office of the Secretary of State, but it is not effective unless (1) the plaintiff, who may be the Secretary of State in a suit, action or proceeding instituted by him, forthwith sends notice of the service and a copy of the process by registered mail to the defendant or respondent at his last address on file with the Secretary of State, and (2) the plaintiff's affidavit of compliance with this section is filed in the case on or before the return day of the process, if any, or within such further time as the court allows.

SECTION 17. This act shall take effect and be in force from and after its passage.