35-8A-2. Definitions of terms.

Terms used in this chapter mean:

(1)    "Agreement," any commercial relationship between a wholesaler and a supplier of a definite duration or indefinite duration, whether written or oral, whereby the wholesaler is granted by the supplier the right to offer and sell the supplier's brands of malt beverages;

(2)    "Ancillary business," any business owned by a wholesaler, a controlling stockholder of a wholesaler, or a controlling partner of a wholesaler, the assets of which are primarily used in transporting, storing, or marketing the brand or brands of malt beverage of the supplier with whom the wholesaler has an agreement; or a business owned by wholesaler, a controlling stockholder of a wholesaler, or a controlling partner of a wholesaler which recycles returnable beverage containers;

(3)    "Controlling stockholder" or "controlling partner," any person with an ownership interest in the wholesaler of fifty percent or more;

(4)    "Designated member," the spouse, child, grandchild, parent, brother, or sister of a deceased individual, who owned an interest in a wholesaler, who inherits the deceased individual's ownership interest under the terms of the deceased individual's will, or who has otherwise, by testamentary device, succeeded the deceased individual in the wholesaler's business, or who inherits such ownership interest under the laws of intestate succession of this state. With respect to an incapacitated individual having an ownership interest in a wholesaler, the term means the person appointed by the court as the conservator of such individual's property. The term also includes the appointed and qualified personal representative and the testamentary trustee of a deceased individual having an ownership interest in a wholesaler;

(5)    "Good cause," the failure to comply substantially with the provisions of an agreement, which provisions are reasonable, of material significance, not unconscionable and are not discriminatory as compared with provisions imposed by the supplier on other similarly-situated wholesalers. The term does not include failure or refusal on the part of a wholesaler or supplier to engage in any trade practice, conduct, or activity which would result in a violation of any federal law or regulation or any laws or rules of this state;

(6)    "Good faith," the duty of each party to any agreement to deal with the other party in a fair, reasonable, and nondiscriminatory manner consistent with reasonable commercial standards of fair dealing;

(7)    "Malt beverages," as defined in subdivision 35-1-1(8) and includes any other beverage obtained by the alcoholic fermentation of an infusion or decoction, or combination of both, in potable brewing water, of malted barley with hops or their parts or their products and with or without other malted cereals, and with or without the addition of unmalted or prepared cereals, other carbohydrates or products prepared therefrom, and with or without the addition of carbon dioxide and with or without other wholesome products suitable for human food consumption;

(8)    "Mutually binding written agreement," a written agreement voluntarily entered into by a supplier and a wholesaler whereby the wholesaler is granted by the supplier the right to offer and sell the supplier's brand of malt beverages, and the supplier and wholesaler have agreed to the essential terms and conditions governing their relationship, which essential terms and conditions shall include the term of the relationship, the rights and obligations of the respective parties with regard to the purchase, handling, distribution, marketing, sale, and quality control of supplier's products, and standards and procedures for amendment and termination of the agreement and for transfer of the wholesaler's business;

(9)    "Reasonable qualifications," those reasonable and nondiscriminatory standards of the supplier which apply to other similarly situated wholesalers of the supplier, or to other owners or managers of other similarly situated wholesalers of the supplier;

(10)    "Successor," any person who replaces a supplier with the right to manufacture, sell, distribute, or import a brand or brands of malt beverages;

(11)    "Supplier," any brewer, fermenter, processor, bottler, packager, or importer of beer located within or without the state or any other person whether located within or without the state who enters into a malt beverage distribution agreement with any wholesaler doing business in the state. The term also includes any successor in interest to the supplier, including any purchaser of assets or stock, any surviving corporation resulting from a merger or liquidation, any receiver or assignee or any trustee of the original supplier;

(12)    "Territory" or "sales territory," the wholesaler's area of sales and service responsibility designated by the supplier;

(13)    "Transfer of wholesaler's business," the voluntary sale, assignment, or other transfer of an amount totaling at least ten percent of the business or control of the business or the assets of the wholesaler, including without limitation the sale or other transfer of stock or assets by merger, consolidation, or dissolution of the wholesalers or the stock of the parent corporation, or the stock or beneficial ownership of any other entity owning or controlling the wholesaler;

(14)    "Wholesaler," any person licensed by this state who imports or causes to be imported into this state, or purchases or causes to be purchased within this state, any malt beverage for sale or resale to retailers licensed by this state.

Source: SL 1990, ch 300, § 2; SL 1999, ch 187, § 7.