Conn. Gen. Stat. § 36a-861

Current with legislation from the 2024 Regular and Special Sessions.

Section 36a-861 - Definitions

As used in this section and sections 36a-862 to 36a-872, inclusive:

(1) "Commercial financing" means any extension of sales-based financing by a provider in an amount not exceeding two hundred fifty thousand dollars, the proceeds of which the recipient does not intend to use primarily for personal, family or household purposes;

(2) "Commercial financing broker" means a person, other than a financer, who, for compensation or the expectation of compensation, offers, or offers to obtain, commercial financing for a recipient from a provider that is not exempt;

(3) "Finance charge" means the cost of financing expressed as a dollar amount, including (A) any charge payable directly or indirectly by the recipient and imposed directly or indirectly by the provider as an incident to, or a condition of, the extension of financing, and (B) all charges that would be included under the definition of "finance charge" in 12 CFR 1026.4, as amended from time to time, as if the transaction were subject to said section;

(4) "Financer" means a person who provides, or will provide, commercial financing to a recipient;

(5) "Person" means an individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust or unincorporated organization, including, but not limited to, a sole proprietorship;

(6) "Provider" means a person who extends a specific offer of commercial financing to a recipient and includes, unless otherwise exempt under this section, a commercial financing broker, but does not include any (A) bank, out-of-state bank, bank holding company, Connecticut credit union, federal credit union, out-of-state credit union or any subsidiary or affiliate of the foregoing, as those terms are defined in section 36a-2, (B) person acting in such person's capacity as a technology services provider to an entity exempt under this section for use as part of the exempt entity's commercial financing program, provided such person has no interest, arrangement or agreement to purchase any interest in the commercial financing extended by the exempt entity in connection with such program, (C) lender regulated under the federal Farm Credit Act, 12 USC 2001 et seq., as amended from time to time, (D) person or provider who extends or brokers a commercial financing transaction secured by real property, (E) person or provider who extends or brokers a lease, as defined in section 42a-2A-102, (F) person or provider who extends or brokers a purchase-money obligation, as defined in section 42a-9-103a, (G) person or provider who extends not more than five commercial financing transactions in this state in a twelve-month period, (H) person or provider who extends or brokers a commercial financing transaction entered into pursuant to a commercial financing agreement or commercial open-end credit plan of at least fifty thousand dollars, in which the recipient is (i) a dealer, as defined in section 14-1, or an affiliate of such a dealer, or (ii) a motor vehicle rental company, or an affiliate of such a company, or (I) person or provider who extends or brokers a commercial financing transaction in connection with the sale of products or services that such person or provider manufactures, licenses or distributes, or whose parent company, subsidiary or affiliate manufactures, licenses or distributes;

(7) "Recipient" means a person, or the authorized representative of a person, who applies for commercial financing and is made a specific offer of commercial financing by a provider, but does not include a person acting as a commercial financing broker;

(8) "Sales-based financing" means a transaction that is repaid by the recipient to the provider over time (A) as a percentage of sales or revenue, in which the payment amount may increase or decrease according to the volume of sales made or revenue received by the recipient, or (B) according to a fixed payment mechanism that provides for a reconciliation process that adjusts the payment to an amount that is a percentage of sales or revenue; and

(9) "Specific offer" means the specific terms of commercial financing, including, but not limited to, a price or amount, that is quoted to a recipient based on information obtained from or about the recipient, which, if accepted by the recipient, would be binding on the provider, subject to any specific requirements stated in such terms.

Conn. Gen. Stat. § 36a-861

Added by P.A. 23-0201,S. 1 of the Connecticut Acts of the 2023 Regular Session, eff. 7/1/2024.