13 CRR-NY 200.3NY-CRR
13 CRR-NY 200.3
13 CRR-NY 200.3
200.3 Franchise prospectus registration application.
(a) Completion of application.
An application for registration of the prospectus shall include the following:
(1) facing page, employing form (UFRA-A);
(2) supplemental information page(s) which shall contain a statement as to each franchise salesman employed by the franchisor containing the information as to his identity and litigation history called for by section 200.4(c)(2) and (3) of this Part;
(3) certification of application (UFRA-C);
(4) sales agent disclosure form (UFRA-E); and
(5) two copies of the proposed offering prospectus or offering circular.
The following shall be attached to the application:
(6) one copy of the proposed offering prospectus or offering circular;
(7) two copies of any advertising to be used in connection with the offer or sale of franchises;
(8) a consent to service of process (UFRA-D); and
(9) form of guarantee of performance (UFRA-F).
Each disclosure item should be commented upon by use of a statement which fully incorporates the information required by the item, or which states why such information is not or cannot be furnished.
When the person filing the application for registration is a subfranchisor, the application shall also include the same information concerning the subfranchisor as is required from the franchisor; the franchisor, as well as the subfranchisor, shall execute a signature page.
(d) Signing of application.
The application shall be signed by the chief executive officer or a general partner of the applicant; however, it may be signed by another person holding a power of attorney for such purposes so long as the agent has a personal knowledge of the information contained in the application and prospectus. If signed on behalf of the applicant pursuant to a power of attorney, the application shall include as an exhibit a copy of an authorizing corporate or partnership resolution. The applicant or agent shall attest that: the information contained in the application and the prospectus or offering circular is true; that there are no material omissions or misrepresentations contained therein; and that material information which shall thereafter emerge shall be promptly disclosed by amendment, pursuant to section 200.5 of this Part.
(e) Manually signed consent of accountant.
All applications shall be accompanied by a manually signed consent, or a photocopy of the consent, of the independent public accountant to the use of his audited financial statements as such statements appear in the offering prospectus.
(f) Application to amend the registration.
An amendment to an application filed after the effective date of registration shall consist of the following:
(1) facing page employing form (UFRA-A) and containing the number of the amendment;
(2) certification of application (UFRA-C); and
(3) two copies of the prospectus, as amended, one copy red-lined to show the amendment being made.
(h) Applications and forms shall be filed with, and documents, correspondence and other materials shall be mailed or delivered to, the Bureau of Investor Protection and Securities, New York State Department of Law, 28 Liberty Street, New York, NY 10005.
(i) Department action.
(1) The department shall, not later than 30 days after the submission for filing of a franchise prospectus or not later than 15 days after the submission for filing of an amendment to the prospectus, issue a letter stating that the prospectus or amendment has been accepted for filing, or in the alternative indicating the respect in which the application for registration, the proposed offering prospectus or the amendment, is deficient or otherwise fails to make adequate disclosure. In the event that the franchisor resubmits its application, prospectus or amendment following the issuance of a deficiency letter, the department shall, not later than 30 days following the resubmission of the amendment, issue a letter accepting the prospectus for filing or issue a further deficiency letter. This procedure shall be followed until the prospectus or amendment has been accepted for filing or the franchisor has withdrawn or abandoned its application for registration or amendment.
(2) A franchisor may offer or sell interests in franchises or advertise the same notwithstanding the occurrence of an event which would require an amendment to its prospectus, so long as an application to amend is made as required by law and the regulations, and may continue to offer, sell or advertise during the time that the department is acting upon its application unless otherwise advised by the department.
(3) A franchisor making an offer, selling or advertising following the occurrence of an event requiring an amendment shall advise its offeree, in writing, at the time it supplies the offeree with its registered prospectus, that an event requiring amendment has occurred and that an amendment application has been submitted, or will be submitted to the department within 10 business days of such event, and shall supply its offeree with a copy of its amended prospectus when it has been accepted for filing and registered by the department. Any funds paid by the offeree to the franchisor shall, upon their receipt, be held in trust in a separate bank account and shall remain in trust from that time until 10 business days following the date on which the offeree is supplied a copy of the registered amended prospectus. Prior to receipt by the offeree of the registered amended prospectus or within 10 business days following its receipt of the registered amended prospectus, the offeree may rescind the sale and if it does, the franchisor shall pay the trust funds to the offeree forthwith. If the offeree does not rescind either prior to receipt of the registered amended prospectus, or during the 10-day period following receipt of registered amended prospectus, then its acceptance shall remain in force and the funds shall be released from trust and their disposition shall be subject to the agreement made between the franchisor and offeree. If the department refuses to register the amended prospectus, then the franchisor shall, upon such refusal, immediately pay the trust funds to the offeree.
13 CRR-NY 200.3
Current through November 15, 2018
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