Sec. 5-10. Exemptions.
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/il/chapter-815/act-602/5-10A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Sec. 5-10. Exemptions. Registration pursuant to Section 5-30 shall not apply to any of the following:
(a)Any offer or sale of a business opportunity for which the immediate cash payment made by the purchaser for any business opportunity is at least $25,000 if the immediate cash payment does not exceed 20% of the purchaser's net worth as determined exclusive of principal residence, furnishings therein, and automobiles; provided, however, the Secretary of State may by rule or regulation withdraw or further condition the availability of this exemption.
(b)Any offer or sale of a business opportunity which the seller does not advertise, solicit, or sell for an initial payment to the seller or a person recommended by the seller exceeding $500.
(c)Any offer or sale of a business opportunity where the seller has a net worth of not less than $1,000,000 as determined on the basis of the seller's most recent audited financial statement, prepared within 13 months of the first offer in this State. Net worth may be determined on a consolidated basis where the seller is at least 80% owned by one person and that person expressly guarantees the obligations of the seller with regard to the offer or sale of any business opportunity claimed to be exempt under this subsection. The Secretary of State may by rule or regulation withdraw or further condition the availability of this exemption.
(d)Any offer or sale of a business opportunity where the purchaser has a net worth of not less than $250,000. Net worth shall be determined exclusive of principal residence, furnishings therein, and automobiles. The Secretary of State may by rule or regulation withdraw or further condition the availability of this exemption.
(e)Any offer or sale of a business opportunity where the purchaser is a bank, savings and loan association, trust company, insurance company, credit union, or investment company as defined by the federal Investment Company Act of 1940, pension or profit sharing trust, or other financial institution or institutional buyer, or a dealer registered under the Illinois Securities Law of 1953, where the purchaser is acting for itself or in a fiduciary capacity.
(f)Any offer or sale of a business opportunity which is defined as a franchise under the Franchise Disclosure Act of 1987 provided that the seller delivers to each purchaser 14 days prior to the earlier of the execution by a purchaser of any contract or agreement imposing a binding legal obligation on the purchaser or the payment by a purchaser of any consideration in connection with the offer or sale of the business opportunity, a disclosure document prepared in accordance with the requirements of Section 16 of the Illinois Franchise Disclosure Act of 1987, as it may be amended.
(g)Any offer or sale of a business opportunity for which the cash payment required to be made by a purchaser for any business opportunity does not exceed $500 and the payment is made for the not-for-profit sale of sales demonstration equipment, material, or samples or the payment is made for product inventory sold to the purchaser at a bona fide wholesale price.
(h)Any offer or sale of a business opportunity which the Secretary of State exempts by order or a class of business opportunities which the Secretary of State exempts by rule or regulation upon the finding that such exemption would not be contrary to public interest and that registration would not be necessary or appropriate for the protection of purchasers.