2017 Arizona Revised Statutes
Title 44 - Trade and Commerce
§ 44-1801 Definitions
In this chapter and chapter 13 of this title, unless the context otherwise requires:
1. " Blind pool offering" means an offering in which either:
(a) The offering materials do not describe specific operational plans.
(b) Eighty per cent or more of the net offering proceeds are not specifically allocated for the purchase, construction or development of identified property or products, for the payment of indebtedness or overhead expenses, or for other activities set forth in the issuer's business plan.
2. " Commission" means the Arizona corporation commission.
3. " Commodity" means any agricultural, grain or livestock product or by-product, any metal or mineral including a precious metal, any gem or gemstone whether characterized as precious, semiprecious or otherwise, any fuel whether liquid, gaseous or otherwise, any foreign currency and all other goods, articles, products or items of any kind. Commodity does not include a numismatic coin with a fair market value at least fifteen per cent higher than the value of the metal it contains, real property or any timber, agricultural or livestock product grown or raised on real property and offered or sold by the owner or lessee of such real property, or any work of art offered or sold by art dealers, at public auction or offered or sold through a private sale by the owner.
4. " Commodity exchange act" means the act of Congress known as the commodity exchange act (7 United States Code, chapter 1).
5. " Commodity futures trading commission" means the independent regulatory agency established by Congress to administer the commodity exchange act.
6. " Commodity investment contract" means any account, agreement or contract for the purchase or sale, primarily for speculation or investment purposes and not for use or consumption by the offeree or purchaser, of one or more commodities, whether for immediate or subsequent delivery or whether delivery is intended by the parties, and whether characterized as a cash contract, deferred shipment or deferred delivery contract, forward contract, futures contract, installment or margin contract, leverage contract or otherwise. Any commodity investment contract offered or sold, in the absence of evidence to the contrary, is presumed to be offered or sold for speculation or investment purposes. A commodity investment contract does not include any contract or agreement which requires, and under which the purchaser receives, within twenty-eight calendar days after the payment in good funds of any portion of the purchase price, physical delivery of the total amount of each commodity to be purchased under the contract or agreement.
7. " Commodity option" means any account, agreement or contract giving a party to the account, agreement or contract the right but not the obligation to purchase or sell one or more commodities or one or more commodity investment contracts, whether characterized as an option, privilege, indemnity, bid, offer, put, call, advance guaranty, decline guaranty or otherwise.
8. " CRD system" means the central registration depository system of the national association of securities dealers, incorporated.
9. " Dealer" :
(a) Means a person who directly or indirectly engages full-time or part-time in this state as agent, broker or principal in the business of offering, buying, selling or otherwise dealing or trading in securities issued by another person, and who is not a salesman for a registered dealer or is not a bank or savings institution the business of which is supervised and regulated by an agency of this state or the United States.
(b) Means an issuer, other than an investment company, who, directly or through an officer, director, employee or agent who is not registered as a dealer under this chapter, engages in selling securities issued by such issuer.
(c) Does not include a person who sells or offers to sell securities exclusively to dealers registered under this chapter, and who has no place of business within this state.
(d) Does not include a person who buys or sells securities for his own account, either individually or in a fiduciary capacity, but not as part of a regular business.
10. " Director" means the director of the securities division of the commission.
11. " Division" means the securities division of the commission.
12. " Federal covered security" means any security described as a covered security in section 18 of the securities act of 1933.
13. " Issuer" means any person who issues or proposes to issue any security, except:
(a) With respect to certificates of deposit, voting-trust certificates, collateral-trust certificates, certificates of interest or shares in an unincorporated investment trust, whether or not 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 such securities are issued.
(b) With respect to equipment-trust certificates or like securities, issuer means the person by whom the equipment or property is or is to be used.
(c) With respect to fractional interests in any oil, gas or other mineral lease, permit, claim or right, issuer means the owner thereof or of any interest therein, whether whole or fractional, fractional interests in which are created for the purpose of a public offering.
14. " Numismatic coin" :
(a) Means a coin that has all of the following characteristics:
(i) The coin is of interest primarily to coin collectors rather than to speculators or investors in precious metals.
(ii) The fair market value of the coin is determined primarily by its design, subject matter, limited mintage, rarity and relative condition of preservation from wear rather than by its intrinsic precious metal or bullion content.
(iii) The fair market value of the coin is directly related to an individual inspection and grading of its relative condition according to an established system of numismatic standards promulgated independently of the offerer of the coin.
(iv) With the exception of proof, mint and commemorative coins, the coin is minted or manufactured under authority of the issuing government for the purpose of being used as legal tender.
(b) Does not include a coin that has at least one of the following characteristics:
(i) The coin is minted, manufactured or advertised for sale primarily to persons who seek to invest or speculate in precious metals rather than to coin collectors or for use in commerce as legal tender.
(ii) The coin is advertised or sold with the expectation that it will be purchased or traded for its intrinsic precious metal or bullion content.
(iii) The price of the coin is directly related to the spot market price of its intrinsic precious metal or bullion content.
(iv) The coin is generally not used as legal tender.
(v) The quantity of mintage or manufacture of the coin is based on market demand.
(vi) The coin is not sought for its design, subject matter, limited mintage, rarity or relative condition of preservation from wear, but instead is sought for the value of its intrinsic precious metal or bullion content.
15. " Offer to sell" or " offer for sale" means an attempt or offer to dispose of, or solicitation of an order or offer to buy, a security or interest in a security for value or any sale or offer for sale of a warrant or right to subscribe to another security of the same issuer or of another issuer. Any sale or offer for sale of a security which gives the holder thereof a present or future right or privilege to convert such security into another security of the same issuer or of another issuer shall be deemed an offer to sell the security to be acquired pursuant to such right or privilege, but the existence thereof shall not be construed as affecting the registration or exemption under this chapter of the security to which it attaches.
16. " Person" means an individual, corporation, partnership, association, joint stock company or trust, limited liability company, government or governmental subdivision or agency or any other unincorporated organization.
17. " Precious metal" means the following in either coin, bullion or other form:
18. " Real property investment contract" means a contract for the sale or purchase of a promissory note secured directly or collaterally by a mortgage, deed of trust or other lien on real property, including a contract as defined by section 33-741, or any agreement, arrangement or understanding in connection with such note, lien or contract in which a person agrees, implies to do or does any of the following, whether or not the investor is aware that any of the following actions are contemplated or taken:
(a) Guarantee the note, lien or contract against loss at any time.
(b) Promise to provide a market for the sale of the note, lien or contract, in connection with a sale or purchase.
(c) Offer to accept or accept funds for investment in notes or contracts secured directly or indirectly by a lien on real property, where the real property is unspecified at the time of investment.
(d) Pay any interest or premium for a period before actual purchase and delivery of the note or contract.
(e) Pay any money to an investor if the note or contract is in arrears.
(f) Guarantee that principal or interest will be paid in conformity with the terms of the note or contract.
(g) Accept, from time to time, partial payment toward the purchase of the note or contract.
(h) Promise to repurchase the note or contract, in connection with sale or purchase.
19. " Registered dealer" means a dealer registered under this chapter.
20. " Registered salesman" means a salesman registered under this chapter.
21. " Sale" or " sell" means a sale or any other disposition of a security or interest in a security for value, and includes a contract to make such sale or disposition. A security given or delivered with, or as a bonus on account of, a purchase of securities or other thing shall be conclusively presumed to constitute a part of the subject of the purchase and to have been sold for value.
22. " Salesman" means an individual, other than a dealer, employed, appointed or authorized by a dealer to sell securities in this state. The partners or executive officers of a registered dealer shall not be deemed salesmen within the meaning of this definition.
23. " SEC" means the United States securities and exchange commission.
24. " Securities act of 1933" means the act of Congress known as the securities act of 1933.
25. " Securities exchange act of 1934" means the act of Congress known as the securities exchange act of 1934.
26. " Security" means any note, stock, treasury stock, bond, commodity investment contract, commodity option, 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, viatical or life settlement investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas or other mineral rights, real property investment contract 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.
27. " Self-regulatory organization" or " SRO" means any national securities or commodities exchange, registered association or registered clearing agency.
28. " Underwriter" means a person who has acquired from an issuer with a view to, or sells for an issuer in connection with, the distribution of any securities or participates or has a direct or indirect participation in such undertaking, or participates or has a participation in the direct or indirect underwriting of such undertaking. Underwriter shall not include a person whose interest is limited to a commission from an underwriter or dealer not in excess of the usual and customary distributor's or seller's commission.
29. " Viatical or life settlement investment contract" means an agreement for consideration for the purchase, assignment, transfer, sale, devise or bequest of any portion of the death benefit under or ownership of either an insurance policy or certificate of insurance. A viatical or life settlement investment contract does not include:
(a) Any agreement for the original issuance of an insurance policy or certificate of insurance.
(b) An assignment, transfer, sale, devise or bequest of a death benefit under or ownership of either an insurance policy or certificate of insurance by the original owner or a person who has an insurable interest in the insured pursuant to section 20-1104 to any of the following:
(i) The insured.
(ii) A person who has an insurable interest in the insured pursuant to section 20-1104.
(iii) A dealer.
(iv) A person who is engaged in the business of purchasing the death benefit under or ownership of either insurance policies or certificates of insurance.
(c) An assignment of an insurance policy or certificate of insurance to any bank, savings bank, savings and loan association, credit union or other licensed lending institution as collateral for a loan.
(d) The exercise of accelerated benefits pursuant to the life insurance policy.