(1) The minimum purchase or initial subscription to an oil, gas, petroleum or mineral participation plan may not be less than $5,000 and must be payable in full by the purchaser directly to the issuer within twelve (12) months from the date on which the program commences. The initial subscription shall not provide for the offering of financing by the issuer or the issuer’s sales agents either directly or indirectly.
    (2) Compensation to broker/dealers shall be a cash commission. Indeterminate compensation to broker/dealers, such as overriding interests and net profit interests are not acceptable in the absence of a firm underwriting. Warrants or options to broker/dealers are not acceptable in the absence of a firm underwriting.
    (3) Sponsor’s history of operations for the past five (5) years or for such period of time as the Sponsor has been engaged in the business shall be fully disclosed, and when applicable, income for each program shall be scheduled.
    (4) All properties that are acquired by a plan from the Sponsor or affiliate at a consideration other than cost, must have such purchase price established by qualified independent petroleum engineers. If the property is unproductive and/or unexplored, then the value shall be determined by a qualified independent expert.
    (5) Annual audited financial reports and tax information shall be furnished to investors in a form which may be used in the preparation of their individual tax returns. Report of the value of an investor’s interest shall be based on an independent petroleum engineer’s appraisal of the status of the properties.
Rulemaking Authority 517.03 FS. Law Implemented 517.081(7) FS. History-New 9-20-82, Formerly 3E-20.11, 3E-700.12, 3E-700.012.