Sec. 1. 32 MRSA §10301, sub-§2, as amended by PL 1997, c. 168, §1, is further amended to read:

2. Employment of unlicensed persons. It is unlawful for any issuer or broker-dealer licensed under this Act to employ or contract with a person as a sales representative in this State unless the sales representative is licensed or exempt from licensing under this Act.

Sec. 2. 32 MRSA §10301, sub-§3, as amended by PL 1989, c. 542, §8, is further amended to read:

3. Employment of suspended or barred persons. It is unlawful for a broker-dealer, investment adviser or an issuer engaged in offering securities in this State in connection with any of the broker-dealer's, investment adviser's or issuer's securities activities in this State to employ or contract with any person who is then suspended or barred from association with a broker- dealer or investment adviser by the administrator. No broker- dealer, investment adviser or issuer may be deemed to have violated this subsection if the broker-dealer, investment adviser or issuer sustains the burden of proof that the broker-dealer, investment adviser or issuer did not know and in the exercise of reasonable care could not have known of the suspension or bar. Upon request from a broker-dealer, investment adviser or issuer and for good cause shown, the administrator, by order, may waive the prohibition of this subsection with respect to a particular person then suspended or barred.

Sec. 3. 32 MRSA §10302, sub-§2, ķA-2 is enacted to read:

A-2.__A sales representative acting for a broker-dealer licensed under section 10301, subsection 1, in effecting in this State transactions exclusively with financial and institutional investors acting for themselves or in a fiduciary capacity.

Sec. 4. 32 MRSA §10306, sub-§3, as enacted by PL 1985, c. 400, §2, is amended to read:

3. Branch offices. For purposes of this section, a "branch "Branch office" means each any office of a broker-dealer or investment adviser located in this State, other than the principal office of the broker-dealer in this State from which 3 or more sales representatives transact business or investment adviser.