This chapter does not apply to any of the following:
1.Building and loan associations, state or national banks, insurance companies and
associations, and mutual or cooperative telephone companies organized under chapter 491
which have been determined to be exempt from taxation under section 501(c)(12) of the
Internal Revenue Code.
2.Corporationsandcooperativeassociationssubjecttoregulationunderchapter497,498,
or 499.
3.The sale of membership camping contracts by persons or entities registered or exempt
under chapter 557B.
4.The sale of physical exercise club contracts by persons or entities registered under
chapter 552.
5.Corporations, partnerships, unincorporated associations, or other business enterprises
which sell or offer for sale memberships to an individual or to a family unit
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This chapter does not apply to any of the following:
1. Building and loan associations, state or national banks, insurance companies and
associations, and mutual or cooperative telephone companies organized under chapter 491
which have been determined to be exempt from taxation under section 501(c)(12) of the
Internal Revenue Code.
2. Corporationsandcooperativeassociationssubjecttoregulationunderchapter497,498,
or 499.
3. The sale of membership camping contracts by persons or entities registered or exempt
under chapter 557B.
4. The sale of physical exercise club contracts by persons or entities registered under
chapter 552.
5. Corporations, partnerships, unincorporated associations, or other business enterprises
which sell or offer for sale memberships to an individual or to a family unit for consideration
of no more than fifty dollars for a one-year period. Consideration for this purpose includes
but is not limited to the amount of any required purchase under the terms of the contract.
6. a. The sale of goods or services by corporations, partnerships, unincorporated
associations, or other business enterprises which sell products to direct sellers as defined
by section 3508 of the Internal Revenue Code, where the initial contract establishing the
relationship with the direct seller is terminable at will by either party, and where the
corporation, partnership, unincorporated association, or other business enterprise offers to
repurchase the products at reasonable commercial terms.
b. For purposes of this subsection, “reasonable commercial terms” includes the
repurchase of all unencumbered products which are in an unused, commercially resalable
condition within one year from the direct seller’s date of purchase. The repurchase shall
be at a price not less than ninety percent of the original net cost to the direct seller of the
products being returned. “Original net cost” means the amount actually paid by the direct
seller for the products, less any consideration received by the direct seller for the purchase
of the products being returned. Products which are no longer marketed by a program shall
be deemed resalable if the products are otherwise in an unused, commercially resalable
condition and are returned to the seller within one year from the direct seller’s date of
§552A.2, BUYING CLUB MEMBERSHIPS 2
purchase, provided, however, that products which are no longer marketed by a program
shall not be deemed resalable if the products are sold to direct sellers as nonreturnable,
discontinued, seasonal, or special promotion items and the nonreturnable nature of the
product was clearly disclosed to the direct seller prior to purchase.