(a) It shall be unlawful for any health spa to offer, advertise, or execute or cause to be executed by the buyer any health spa contract in this State unless the health spa at the time of the offer, advertisement, sale or execution of a health spa contract has been properly registered with the Director.

(b) (1) Prior to advertising or selling pre-opening contracts, every health spa shall register with the Director and shall notify the Director of the proposed location of the health spa for which pre-opening contracts will be solicited;

(2) The registration shall include the address, ownership, directors, corporate officers and parent corporation, if any, date of first sales and date of first opening of the health spa;

(3) The registration shall be renewed annually; and

(4) Each separate location where health spa services are offered shall be considered a separate health spa and shall file a separate registration even though the separate locations are owned or operated by the same owner, unless the spa offers all members fully interchangeable, comparable services at a separate location within a 15-mile radius.

(c) A bond or letter of credit in the amount of $50,000 shall be posted by each health spa prior to advertising or selling pre-opening contracts. The bond with corporate surety from a company authorized to transact business in the State or the letter of credit from a bank insured by the Federal Deposit Insurance Corporation shall be filed and maintained with the Director. After a health spa has opened its facilities and been in operation for 90 days, the health spa may make application to the Director to cancel or terminate the bond or letter of credit. Unless the health spa has been cited for a violation of this chapter pursuant to the authority granted to the Attorney General or the Director by Chapter 25 of Title 29 or to the Attorney General by § 4220 of this title, the Director shall give consent to terminate the bond or letter of credit within 30 days after receiving the health spa’s application.

(d) Upon its application to terminate the bond or letter of credit, the health spa shall pay all fees in accordance with the schedule set forth by § 4204 of this title.

(e) The bond or letter of credit required by this section shall be in favor of the State for the benefit of:

(1) Any buyer injured by having paid money for a health spa contract in a facility which fails to open within 9 months after the date upon which the buyer and the health spa entered into a contract or which substantially fails to provide the services described in the health spa contract;

(2) Any buyer injured as a result of a violation of this chapter.

66 Del. Laws, c. 395, § 1; 69 Del. Laws, c. 291, § 98(a); 70 Del. Laws, c. 186, § 1; 77 Del. Laws, c. 282, § 10.