APPENDIX 1.-S. 2672, EXPLANATION, AND AGENCY REPORTS (The amended bill, a section-by-section explanation, and reports from the Commerce Department and the Deputy Attorney General follow.) Referred to the Committee on Banking and Currency and ordered to be printed AMENDMENT (IN THE NATURE OF A SUBSTITUTE) Intended to be proposed by Mr. to S. 2672, 1 a bill to provide full and fair disclosure of the nature of inter- Be it enacted by the Senate and House of Representa- 4 Full Disclosure Act". 5 DEFINITIONS 6 SEC. 2. For the purposes of this Act, the term— 7 (1) "Commission" means the Securities and Exchange 8 Commission; 243 2 1 (2) "Person” means an individual, firm, partnership, 2 association, corporation, trust, or estate; 3 (3) "Subdivision" and "subdivided lands" means any 4 land which is divided or proposed to be divided into twenty5 five or more lots, parcels, units or interests, whether con6 tiguous or not, for the purpose of offer, sale, or lease as part 7 of a common promotional plan; 8 (4) "Developer" means any person (i) who, having an 9 interest in land, causes it, directly or indirectly, to be divided 10 into a subdivision, or who acquires an interest in a subdivi11 sion, and (ii) who, directly or indirectly, sells or leases, or 12 offers to sell or lease, or advertises for sale or lease any inter13 est, lot, or parcel in such subdivision; 14 (5) "Agent" means any person who represents, or acts 15 for or on behalf of, a developer in selling or leasing, or 16 offering to sell or lease, any interest, lot, or parcel in a 17 subdivision; but shall not include an attorney at law whose 18 representation of another person consists solely of rendering 19 legal services; 20 222 (6) "Blanket encumbrance" means a trust deed, mort 21 gage, or any other lien or encumbrance, including an option 22 or contract to sell or trust agreement, affecting a subdivision 23 or affecting more than one lot or parcel offered within a 24 subdivision; except that such term shall not include any lien 1 3 or other encumbrance arising as the result of the imposition 2 of any tax or assessment by any public authority; 3 (7) "Interstate commerce" means trade or commerce 4 among the several States, or between the District of Colum5 bia or any possession of the United States and any State or 6 other possession, or between any foreign country and any 7 State, possession, or the District of Columbia, or within 8 the District of Columbia; 9 (8) "Investors" means actual and prospective pur10 chasers or lessees of any interest, lot, or parcel in any 11 subdivision; 23 12 (9) "Prospectus" means a written brochure or circular 13 meeting the requirements of section 8 of this Act; 14 15 16 17 (10) "Offer" includes every inducement, solicitation, or attempt to encourage a person to acquire an interest in a subdivision; (11) "Sale" or "sell" means any contract of sale or 18 disposition for value of an interest in a subdivision. EXEMPTIONS SEC. 3. (a) The provisions of this Act shall not apply (1) the sale or lease of real estate not pursuant to a common promotional plan to offer or sell 25 or more parcels of subdivided land. 1 2 3 4 5 6 7 8 9 10 11 122 13 14 15 16 17 18 19 20 4 (2) the sale or lease of any improved land on which there is a residential, commercial, or industrial building, or to the sale or lease of land under a contract obligating the seller to erect a dwelling thereon within a period of two years. (3) the sale of real estate under or pursuant to court order; (4) the sale of evidences of indebtedness secured by a mortgage or deed of trust on real estate; (5) the sale of securities issued by a real estate investment trust regulated under any State or Federal statute; (6) offers to sell or dispositions by any government or government agency; (7) offers to sell and dispositions of cemetery lots or interests; (8) any interest, lot, or parcel which is a part of a subdivision within, and offered and sold only to persons resident within, a single State or territory, where the developer of such subdivision is a person resident and 21 doing business within, or, if a corporation, incorporated 2235 23 24 25 by and doing business within, such State or territory. (b) The Commission may from time to time by its rules and regulations, and subject to such terms and condi tions as may be prescribed therein, exempt from the pro |