Texas Business & Commerce Code - Section 38.153. Disclosure Of Certain Sales Information
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Texas Lawyer > Business & Commerce Code > Texas Business & Commerce Code - Section 38.153. Disclosure Of Certain Sales Information
§ 38.153. DISCLOSURE OF CERTAIN SALES INFORMATION. The
registration statement must be accompanied by:
(1) a description of the items the seller is offering
for sale;
(2) a copy of all sales information and literature,
including scripts, outlines, instructions, and information
regarding the conduct of telephone solicitations, sample
introductions, sample closings, product information, and contest
or premium-award information, provided by the seller to
salespersons or about which the seller informs salespersons;
(3) a copy of all written material the seller sends to
any purchaser;
(4) if the seller represents or implies, or directs
salespersons to represent or imply, to purchasers that the
purchaser will receive a specific item, including a certificate
that the purchaser must redeem to obtain the item described in the
certificate, or one or more items from among designated items,
whether the items are designated as gifts, premiums, bonuses,
prizes, or otherwise:
(A) a list of the items described;
(B) the value of each item and the basis for the
valuation;
(C) the price paid by the seller to its supplier
for each item and the name, address, and telephone number of each
item's supplier;
(D) if the purchaser is to receive fewer than all
of the items described by the seller:
(i) the manner in which the seller decides
which item a particular purchaser is to receive;
(ii) for each item, the odds of a single
purchaser's receiving the item; and
(iii) the name and address of each
recipient who has received, during the preceding 12 months or, if
the seller has not been in business that long, during the period the
seller has been in business, the item having the greatest value and
the item with the smallest odds of being received; and
(E) all rules, regulations, and terms a purchaser
must meet to receive the item;
(5) if the seller is offering an item that the seller
does not manufacture or supply:
(A) the name, address, and telephone number of
each of the seller's suppliers and a description of each item
provided by the supplier;
(B) if the possession of the item is to be
retained by the seller or will not be transferred to the purchaser
until the purchaser has paid in full:
(i) the address of each location where the
item will be kept;
(ii) if not kept on premises owned by the
seller or at an address registered under Section 38.151(8) or (9),
the name of the owner of the business at which the item will be kept;
and
(iii) a copy of any contract or other
document that evidences the seller's right to store the item at the
address designated under Subparagraph (ii);
(C) if the seller is not selling the item from its
own inventory but purchases the item to fill an order already taken
from a purchaser, copies of all contracts or other documents
evidencing the seller's ability to call on suppliers to fill the
seller's orders;
(D) if the seller represents to purchasers that
the seller has insurance or a surety bond relating to a purchaser's
purchase of an item, a copy of each insurance policy and bond; and
(E) if the seller makes a representation as to
the post-purchase earning or profit potential of an item, data to
substantiate the claims made and, if the representation relates to
previous sales made by the seller or a related entity,
substantiating data based on the experiences of at least 50 percent
of the persons who purchased that particular type of item from the
seller or related entity during the preceding six months or, if the
seller or related entity has not been in business that long, during
the period the seller or related entity has been in business,
including:
(i) the period the seller or related entity
has been selling the particular type of item being offered;
(ii) the number of purchasers of the item
from the seller or related entity known to the seller or related
entity to have made at least the same earnings or profit as those
represented; and
(iii) the percentage that the number
disclosed under Subparagraph (ii) represents of the total number of
purchasers from the seller or related entity of the particular type
of item offered; and
(6) if the seller is offering to sell an interest in an
oil, gas, or mineral field, well, or exploration site:
(A) the seller's ownership interest, if any, in
each field, well, or site being offered for sale;
(B) the total number of interests to be sold in
each field, well, or site being offered for sale; and
(C) if, in selling an interest in any particular
field, well, or site, reference is made to an investigation of the
field, well, or site by the seller or anyone else:
(i) the name, business address, telephone
number, and professional credentials of the person who made the
investigation; and
(ii) a copy of the report and other
documents relating to the investigation prepared by the person.
Added by Acts 1997, 75th Leg., ch. 1008, § 2, eff. Sept. 1, 1997.
Section: 38.104 38.105 38.106 38.107 38.108 38.151 38.152 38.153 38.201 38.202 38.203 38.251 38.252 38.253 38.301
Last modified: August 10, 2007
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