(a) A 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, that the seller provides to salespersons or about which the seller informs salespersons;
(3) a copy of all written material the seller sends to any purchaser; and
(4) as applicable, the information and documents specified by Subsections (b) through (h).
(b) If the seller represents or implies, or directs a salesperson to represent or imply, to a purchaser 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, regardless of whether the items are designated as gifts, premiums, bonuses, or prizes or otherwise, the registration statement must be accompanied by:
(1) a list of the items described;
(2) the value of each item and the basis for the valuation;
(3) the price the seller paid for each item to the seller's supplier and the name, address, and telephone number of each item's supplier;
(4) all rules and terms a purchaser must meet to receive the item; and
(5) if the purchaser will not receive all of the items described by the seller:
(A) the manner in which the seller decides which item a particular purchaser is to receive;
(B) for each item, the odds of a single purchaser receiving the item; and
(C) the name and address of each purchaser who has received, during the preceding 12 months, the item with the greatest value and the item with the lowest odds of being received.
(c) If the seller is offering an item that the seller does not manufacture or supply, the registration statement must be accompanied by:
(1) the name, address, and telephone number of each of the seller's suppliers;
(2) a description of each item provided by each supplier named in Subdivision (1); and
(3) as applicable, the information and documents specified by Subsections (d) through (g).
(d) If the seller is offering an item that the seller does not manufacture or supply and 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, the registration statement must be accompanied by:
(1) the address of each location where the item will be kept;
(2) if the item is not kept on premises owned by the seller or at an address registered under Section 302.151 (8) or (9), the name of the owner of the business at which the item will be kept; and
(3) a copy of any contract or other document that evidences the seller's right to store the item at the address designated under Subdivision (2).
(e) If the seller is offering an item that the seller does not manufacture or supply and the seller is not selling the item from the seller's own inventory but purchases the item to fill an order previously taken from a purchaser, the registration statement must be accompanied by a copy of each contract or other document that evidences the seller's ability to call on suppliers to fill the seller's orders.
(f) If the seller is offering an item that the seller does not manufacture or supply and the seller represents to purchasers that the seller has insurance or a surety bond relating to a purchaser's purchase of an item, the registration statement must be accompanied by a copy of each insurance policy or bond.
(g) If the seller is offering an item that the seller does not manufacture or supply and the seller makes a representation regarding the post-purchase earning or profit potential of an item, the registration statement must be accompanied by:
(1) data to substantiate the claims made; and
(2) 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 purchasers of that particular type of item from the seller or related entity during the preceding six months, including:
(A) the period the seller or related entity has been selling the particular type of item being offered;
(B) the number of purchasers of the item known to the seller or related entity to have made at least the same earnings or profit as those represented; and
(C) the percentage that the number disclosed under Paragraph (B) represents of the total number of purchasers from the seller or related entity of the particular type of item offered.
(h) If the seller is offering to sell an interest in an oil, gas, or mineral field, well, or exploration site, the registration statement must be accompanied by:
(1) any ownership interest of the seller in each field, well, or site being offered for sale;
(2) the total number of interests to be sold in each field, well, or site being offered for sale; and
(3) 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:
(A) the name, business address, telephone number, and professional credentials of the person who conducted the investigation; and
(B) a copy of the report and other documents relating to the investigation prepared by the person who conducted the investigation.
Added by Acts 2007, 80th Leg., R.S., Ch. 885 (H.B. 2278 ), Sec. 2.01, eff. April 1, 2009.
SUBCHAPTER E. ADDITIONAL INFORMATION FROM SELLER
