59.1-264 - Written disclosure statement required.
§ 59.1-264. Written disclosure statement required.
A. At least forty-eight hours prior to the time the purchaser signs abusiness opportunity contract, or at least forty-eight hours prior to thereceipt of any consideration therefor by the seller, whichever occurs first,the seller shall provide the prospective purchaser with a written document,the cover sheet of which is entitled in at least ten-point boldface capitalletters "DISCLOSURES REQUIRED BY VIRGINIA LAW." Under this title shallappear the following statement in at least ten-point type: "The Commonwealthof Virginia has not reviewed and does not approve, recommend, endorse orsponsor any business opportunity. The information contained in thisdisclosure has not been verified by the Commonwealth. If you have anyquestions about this investment, see an attorney before you sign a contractor agreement." Nothing except the title and required statement shall appearon the cover sheet. The disclosure document shall also contain the following:
1. The name of the seller; whether the seller is doing business as anindividual, partnership, or corporation; the names under which the seller hasdone, is doing or intends to do business in Virginia; and the name of anyparent or affiliated company which is legally obligated to engage in businesstransactions with purchasers.
2. The names, addresses and titles of the seller's officers, directors,trustees, general partners, general managers, principal executives, and anyother person charged with responsibility for the seller's business activitiesrelating to the sale of business opportunities.
3. The length of time the seller has:
a. Sold business opportunities;
b. Sold business opportunities involving the product, products, equipment,supplies, or services currently being offered to the purchaser.
4. A full and detailed description of the actual services that the businessopportunity seller agrees to perform for the purchaser.
5. A copy of a financial statement of the seller, which shall not be olderthan thirteen months, which shall be updated to reflect any material changesin the seller's financial condition.
6. The following statement:
"If the seller fails to deliver the product, products, equipment or suppliesnecessary to begin substantial operation of the business within forty-fivedays of the delivery date stated in your contract, you may notify the sellerin writing of your termination of the contract."
B. If training of any type is promised by the seller, the disclosurestatement shall set forth a complete description of the training and thelength of the training.
C. If the seller promises services to be performed in connection with theplacement of the equipment, product, products, or supplies at any location orat various locations, the disclosure statement must set forth the full natureof those services as well as the nature of the agreements to be made with theowners or managers of the location or locations where the purchaser'sequipment, product, products or supplies will be placed.
D. If the business opportunity seller is required to secure a bond orestablish a trust deposit pursuant to § 59.1-265, the document shall state inat least ten-point type, either:
1. "As required by Virginia law, the seller has secured a bond issued by
.................... (name and address of surety company), a surety company
authorized to do business in this State. Before signing a contract to purchase
this business opportunity, you should check with the surety company to
determine the bond's current status," or
2. "As required by Virginia law, the seller has established a trust account
with .................... (name and address of bank or savings institution).
Before signing a contract to purchase this business opportunity, you should
check with the bank or savings institution to determine the current status of
the trust account."
E. If the seller makes any statement concerning sales or earnings or anyrange of sales or earnings that the purchaser may reasonably expect to bemade through this business opportunity, the document shall disclose:
1. The total number of purchasers of business opportunities within the UnitedStates involving the product, products, equipment, supplies or services beingoffered who, to the seller's knowledge, have actually received earnings inthe amount or range specified, within three years prior to the date of thedisclosure statement, and
2. The total number of purchasers of business opportunities within the UnitedStates involving the product, products, equipment, supplies, or servicesbeing offered within three years prior to the date of the disclosurestatement.
(1979, c. 523.)