1. The Administrator may issue an order denying effectiveness to, or suspending or revoking the effectiveness of, a registration statement if the Administrator finds that the order is in the public interest and that:

(a) The registration statement as of its effective date or as of the proposed effective date in the case of an order denying effectiveness, an amendment under subsection 14 or 15 of NRS 90.500, as of its effective date, or a report under subsection 13 of NRS 90.500, is incomplete in any material respect or contains a statement that, in the light of the circumstances under which it was made, was false or misleading with respect to a material fact;

(b) This chapter, or a regulation, order or condition lawfully imposed under this chapter, has been willfully violated in connection with the offering by:

(1) The person filing the registration statement;

(2) The issuer, a partner, officer or director of the issuer, a person occupying similar status or performing similar functions, or a person directly or indirectly controlling or controlled by the issuer, but only if the person filing the registration statement is directly or indirectly controlled by or acting for the issuer; or

(3) An underwriter;

(c) The security registered or sought to be registered is the subject of a permanent or temporary injunction of a court of competent jurisdiction or an administrative order similar to an order under this section entered under any other federal or state law applicable to the offering, except that the Administrator may not:

(1) Institute a proceeding against an effective registration statement under this paragraph more than 1 year after the date of the order or injunction relied on; or

(2) Enter an order under this paragraph on the basis of an order or injunction entered under the securities act of another state unless the order or injunction was based on facts that currently would constitute a ground for an order under this section;

(d) The issuer’s enterprise or method of business includes or would include activities that are illegal where performed;

(e) The offering has worked or tended to work a fraud upon purchasers or would so operate;

(f) The offering has been or would be made with unreasonable amounts of underwriters’ and sellers’ discounts, commissions or other compensation, or promoters’ profits or participation, or unreasonable amounts or kinds of options;

(g) A security sought to be registered pursuant to NRS 90.470 is not eligible for such registration;

(h) With respect to a security sought to be registered pursuant to NRS 90.480, there has been a failure to comply with the undertaking required by paragraph (d) of subsection 2 of that section; or

(i) The applicant or registrant has failed to pay the proper filing fee, but the Administrator may enter only an order denying effectiveness under this paragraph and shall vacate the order if the deficiency is corrected.

2. The Administrator may not institute a proceeding:

(a) Against an effective registration statement on the basis of a fact or transaction known to the Administrator when the registration statement became effective unless the proceeding is instituted within 30 days after the registration statement became effective; or

(b) With respect to a registration filed under NRS 90.470 on the basis of paragraph (e) or (f) of subsection 1.

3. The Administrator may vacate or modify an order entered under this section if the Administrator finds that the conditions which prompted entry have changed or that it is otherwise in the public interest.

(Added to NRS by 1987, 2170; A 1989, 160)