{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/59.1-306.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/59.1-306.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/59.1-306.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/59.1-306.html"}],"law_id":63585,"edition_id":1,"section_id":63585,"structure_id":13741,"section_number":"59.1-306","catch_line":"Bond or letter of credit required; exception","history":"1984, c. 738; 1985, c. 585; 1990, cc. 392, 433; 1992, c. 117; 2004, c. 988; 2010, c. 439; 2014, c. 459.","full_text":"A\n\nEvery health club, before it enters into a health club contract and accepts any moneys in excess of the prorated monthly fee for the month when the contract is initially executed plus one month’s fees or accepts any initiation fee in excess of $125, shall file and maintain with the Commissioner, in form and substance satisfactory to him, a bond with corporate surety, from a company authorized to transact business in the Commonwealth or a letter of credit from a bank insured by the Federal Deposit Insurance Corporation in the amounts indicated below:\n\t\t\tFor purposes of calculating the number of applicable unexpired health club contracts when determining the required amount of bond or letter of credit, health club contracts entered into on or after January 1, 2005, with a term that exceeds 13 months shall be counted as multiple health club contracts, such that the number of applicable contracts counted with respect thereto shall equal the total of the number of full years and any partial year in its term. However, this paragraph shall not apply (i) to health club contracts that are payable only on a monthly basis and for which the initiation fee is no more than $250 or (ii) if the number of the health club’s contracts in effect with a term that exceeds 13 months is less than 10 percent of the total of its health club contracts.\n\t\t\tThe number of applicable unexpired contracts shall be separately calculated for each facility.\n\t\t\tA health club shall file a separate bond or letter of credit with respect to each separate facility, even though the separate facilities are owned or operated by the same health club.\n\t\t\tHowever, no health club shall be required to file with the Commissioner bonds or letters of credit in excess of $300,000. If the $300,000 limit is applicable, then the bonds or letters of credit filed by the health club shall apply to all facilities owned or operated by the same health club.B\n\nA health club may sell health club contracts of up to 36 months’ duration for a facility for which a health club has not filed a bond or letter of credit so long as the amount of payment actually charged, due or received under the health club contracts each month by the health club or any holder thereunder does not exceed the monthly fee calculated pursuant to the definition thereof in § 59.1-296, with the exception that the payment actually charged may include a maximum initiation fee of $125 for health club contracts of 13 months or more in duration.","order_by":null,"text":{"0":{"id":231643,"text":"Every health club, before it enters into a health club contract and accepts any moneys in excess of the prorated monthly fee for the month when the contract is initially executed plus one month’s fees or accepts any initiation fee in excess of $125, shall file and maintain with the Commissioner, in form and substance satisfactory to him, a bond with corporate surety, from a company authorized to transact business in the Commonwealth or a letter of credit from a bank insured by the Federal Deposit Insurance Corporation in the amounts indicated below:\n\t\t\tFor purposes of calculating the number of applicable unexpired health club contracts when determining the required amount of bond or letter of credit, health club contracts entered into on or after January 1, 2005, with a term that exceeds 13 months shall be counted as multiple health club contracts, such that the number of applicable contracts counted with respect thereto shall equal the total of the number of full years and any partial year in its term. However, this paragraph shall not apply (i) to health club contracts that are payable only on a monthly basis and for which the initiation fee is no more than $250 or (ii) if the number of the health club’s contracts in effect with a term that exceeds 13 months is less than 10 percent of the total of its health club contracts.\n\t\t\tThe number of applicable unexpired contracts shall be separately calculated for each facility.\n\t\t\tA health club shall file a separate bond or letter of credit with respect to each separate facility, even though the separate facilities are owned or operated by the same health club.\n\t\t\tHowever, no health club shall be required to file with the Commissioner bonds or letters of credit in excess of $300,000. If the $300,000 limit is applicable, then the bonds or letters of credit filed by the health club shall apply to all facilities owned or operated by the same health club.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":231644,"text":"A health club may sell health club contracts of up to 36 months’ duration for a facility for which a health club has not filed a bond or letter of credit so long as the amount of payment actually charged, due or received under the health club contracts each month by the health club or any holder thereunder does not exceed the monthly fee calculated pursuant to the definition thereof in § 59.1-296, with the exception that the payment actually charged may include a maximum initiation fee of $125 for health club contracts of 13 months or more in duration.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A"}},"ancestry":[{"id":13741,"edition_id":1,"name":"Virginia Health Club Act","identifier":"24","label":"chapter","depth":2,"order_by":1,"parent_id":12809,"metadata":{},"date_created":"2026-06-26 03:45:45","date_modified":"2026-06-26 03:45:45","permalink":{"id":260589,"object_type":"structure","relational_id":13741,"identifier":"24","token":"59.1\/24","url":"\/59.1\/24\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12809,"edition_id":1,"name":"Trade and Commerce","identifier":"59.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:54","date_modified":"2026-06-26 03:43:54","permalink":{"id":259521,"object_type":"structure","relational_id":12809,"identifier":"59.1","token":"59.1","url":"\/59.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":65021,"structure_id":13741,"section_number":"59.1-294","catch_line":"Short title","url":"\/59.1-294\/","token":"59.1\/24\/59.1-294","metadata":false},{"id":79666,"structure_id":13741,"section_number":"59.1-295","catch_line":"Statement of purpose","url":"\/59.1-295\/","token":"59.1\/24\/59.1-295","metadata":false},{"id":77481,"structure_id":13741,"section_number":"59.1-296","catch_line":"Definitions","url":"\/59.1-296\/","token":"59.1\/24\/59.1-296","metadata":false},{"id":62798,"structure_id":13741,"section_number":"59.1-296.1","catch_line":"Registration; fees","url":"\/59.1-296.1\/","token":"59.1\/24\/59.1-296.1","metadata":false},{"id":73004,"structure_id":13741,"section_number":"59.1-296.2","catch_line":"Contracts sold on prepayment basis","url":"\/59.1-296.2\/","token":"59.1\/24\/59.1-296.2","metadata":false},{"id":84951,"structure_id":13741,"section_number":"59.1-296.2:1","catch_line":"Prepayment contracts; prohibited practices; relocation; refund","url":"\/59.1-296.2_1\/","token":"59.1\/24\/59.1-296.2_1","metadata":false},{"id":81442,"structure_id":13741,"section_number":"59.1-296.2:2","catch_line":"Automated external defibrillator required","url":"\/59.1-296.2_2\/","token":"59.1\/24\/59.1-296.2_2","metadata":false},{"id":84485,"structure_id":13741,"section_number":"59.1-296.3","catch_line":"Initiation fees","url":"\/59.1-296.3\/","token":"59.1\/24\/59.1-296.3","metadata":false},{"id":54962,"structure_id":13741,"section_number":"59.1-297","catch_line":"Right of cancellation","url":"\/59.1-297\/","token":"59.1\/24\/59.1-297","metadata":false},{"id":63583,"structure_id":13741,"section_number":"59.1-297.1","catch_line":"Payment and calculation of refunds","url":"\/59.1-297.1\/","token":"59.1\/24\/59.1-297.1","metadata":false},{"id":59624,"structure_id":13741,"section_number":"59.1-297.2","catch_line":"Automatic termination of a health club contract","url":"\/59.1-297.2\/","token":"59.1\/24\/59.1-297.2","metadata":false},{"id":85709,"structure_id":13741,"section_number":"59.1-298","catch_line":"Notice to buyer","url":"\/59.1-298\/","token":"59.1\/24\/59.1-298","metadata":false},{"id":75243,"structure_id":13741,"section_number":"59.1-299","catch_line":"Duration of contract","url":"\/59.1-299\/","token":"59.1\/24\/59.1-299","metadata":false},{"id":67031,"structure_id":13741,"section_number":"59.1-300","catch_line":"Provisions of this chapter not exclusive","url":"\/59.1-300\/","token":"59.1\/24\/59.1-300","metadata":false},{"id":69302,"structure_id":13741,"section_number":"59.1-301","catch_line":"Noncomplying contract voidable","url":"\/59.1-301\/","token":"59.1\/24\/59.1-301","metadata":false},{"id":54742,"structure_id":13741,"section_number":"59.1-302","catch_line":"Fraud rendering contract void","url":"\/59.1-302\/","token":"59.1\/24\/59.1-302","metadata":false},{"id":67696,"structure_id":13741,"section_number":"59.1-303","catch_line":"Waiver of provisions void and unenforceable","url":"\/59.1-303\/","token":"59.1\/24\/59.1-303","metadata":false},{"id":66423,"structure_id":13741,"section_number":"59.1-304","catch_line":"Notice of preservation of buyers' rights","url":"\/59.1-304\/","token":"59.1\/24\/59.1-304","metadata":false},{"id":72661,"structure_id":13741,"section_number":"59.1-305","catch_line":"Prohibition against assignment of health club contract cutting off buyer's right of action or defense against seller; conditions","url":"\/59.1-305\/","token":"59.1\/24\/59.1-305","metadata":false},{"id":63585,"structure_id":13741,"section_number":"59.1-306","catch_line":"Bond or letter of credit required; exception","url":"\/59.1-306\/","token":"59.1\/24\/59.1-306","metadata":false},{"id":84158,"structure_id":13741,"section_number":"59.1-307","catch_line":"Bond or letter of credit; persons protected","url":"\/59.1-307\/","token":"59.1\/24\/59.1-307","metadata":false},{"id":68743,"structure_id":13741,"section_number":"59.1-308","catch_line":"Change in ownership of health club","url":"\/59.1-308\/","token":"59.1\/24\/59.1-308","metadata":false},{"id":80382,"structure_id":13741,"section_number":"59.1-308.1","catch_line":"Production of records","url":"\/59.1-308.1\/","token":"59.1\/24\/59.1-308.1","metadata":false},{"id":65301,"structure_id":13741,"section_number":"59.1-308.2","catch_line":"Investigations","url":"\/59.1-308.2\/","token":"59.1\/24\/59.1-308.2","metadata":false},{"id":66761,"structure_id":13741,"section_number":"59.1-309","catch_line":"Enforcement; penalties","url":"\/59.1-309\/","token":"59.1\/24\/59.1-309","metadata":false},{"id":73149,"structure_id":13741,"section_number":"59.1-310","catch_line":"Applicability","url":"\/59.1-310\/","token":"59.1\/24\/59.1-310","metadata":false}],"previous_section":{"id":72661,"structure_id":13741,"section_number":"59.1-305","catch_line":"Prohibition against assignment of health club contract cutting off buyer's right of action or defense against seller; conditions","url":"\/59.1-305\/","token":"59.1\/24\/59.1-305","metadata":false},"next_section":{"id":84158,"structure_id":13741,"section_number":"59.1-307","catch_line":"Bond or letter of credit; persons protected","url":"\/59.1-307\/","token":"59.1\/24\/59.1-307","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/59.1-306\/","history_text":"

This law was first created in 1984. The record of its establishment is cataloged in chapter 738 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1984 \u201cActs\u201d aren\u2019t available online. It has been modified 6 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1985, chapter 585; in 1990, chapters 392 and 433; in 1992, chapter 117; in 2004, chapter 988<\/a>; in 2010, chapter 439<\/a>; in 2014, chapter 459<\/a>.<\/p>","references":[{"id":62798,"section_number":"59.1-296.1","catch_line":"Registration; fees","order_by":null,"url":"\/59.1-296.1\/"},{"id":84951,"section_number":"59.1-296.2:1","catch_line":"Prepayment contracts; prohibited practices; relocation; refund","order_by":null,"url":"\/59.1-296.2_1\/"},{"id":84158,"section_number":"59.1-307","catch_line":"Bond or letter of credit; persons protected","order_by":null,"url":"\/59.1-307\/"}],"refers_to":[{"id":77481,"section_number":"59.1-296","catch_line":"Definitions","order_by":null,"url":"\/59.1-296\/"}],"permalink":{"id":260667,"object_type":"law","relational_id":63585,"identifier":"59.1-306","token":"59.1\/24\/59.1-306","url":"\/59.1-306\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/59.1-306\/","token":"59.1\/24\/59.1-306","dublin_core":{"Title":"Bond or letter of credit required; exception","Type":"Text","Format":"text\/html","Identifier":"\u00a7 59.1-306","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Every health club, before it enters into a health club contract<\/span> and accepts any moneys in excess of the prorated monthly fee<\/span> for the month when the contract is initially executed plus one month’s fees or accepts any initiation fee<\/span> in excess of $125, shall file and maintain with the Commissioner<\/span>, in form and substance satisfactory to him, a bond<\/span> with corporate surety<\/span>, from a company authorized to transact business in the Commonwealth or a letter of credit from a bank insured by the Federal Deposit Insurance Corporation in the amounts indicated below:\n\t\t\tFor purposes of calculating the number of applicable unexpired health club contracts<\/span> when determining the required amount of bond<\/span> or letter of credit, health club contracts<\/span> entered into on or after January 1, 2005, with a term that exceeds 13 months shall be counted as multiple health club contracts<\/span>, such that the number of applicable contracts counted with respect thereto shall equal the total of the number of full years and any partial year in its term. However, this paragraph shall not apply (i) to health club contracts<\/span> that are payable only on a monthly basis and for which the initiation fee<\/span> is no more than $250 or (ii) if the number of the health club’s contracts in effect with a term that exceeds 13 months is less than 10 percent of the total of its health club contracts<\/span>.\n\t\t\tThe number of applicable unexpired contracts shall be separately calculated for each facility<\/span>.\n\t\t\tA health club shall file a separate bond<\/span> or letter of credit with respect to each separate facility<\/span>, even though the separate facilities are owned or operated by the same health club.\n\t\t\tHowever, no health club shall be required to file with the Commissioner<\/span> bonds<\/span> or letters of credit in excess of $300,000. If the $300,000 limit is applicable, then the bonds<\/span> or letters of credit filed by the health club shall apply to all facilities owned or operated by the same health club. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> A health club may sell health club contracts<\/span> of up to 36 months’ duration for a facility<\/span> for which a health club has not filed a bond<\/span> or letter of credit so long as the amount of payment actually charged, due or received under the health club contracts<\/span> each month by the health club or any holder thereunder does not exceed the monthly fee<\/span> calculated pursuant to the definition thereof in § 59.1-296<\/a>, with the exception that the payment actually charged may include a maximum initiation fee<\/span> of $125 for health club contracts<\/span> of 13 months or more in duration. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nBOND OR LETTER OF CREDIT REQUIRED; EXCEPTION (\u00a7 59.1-306)\n\nA. Every health club, before it enters into a health club contract and accepts\nany moneys in excess of the prorated monthly fee for the month when the contract\nis initially executed plus one month’s fees or accepts any initiation fee\nin excess of $125, shall file and maintain with the Commissioner, in form and\nsubstance satisfactory to him, a bond with corporate surety, from a company\nauthorized to transact business in the Commonwealth or a letter of credit from a\nbank insured by the Federal Deposit Insurance Corporation in the amounts\nindicated below:\n\t\t\tFor purposes of calculating the number of applicable unexpired health club\ncontracts when determining the required amount of bond or letter of credit,\nhealth club contracts entered into on or after January 1, 2005, with a term that\nexceeds 13 months shall be counted as multiple health club contracts, such that\nthe number of applicable contracts counted with respect thereto shall equal the\ntotal of the number of full years and any partial year in its term. However,\nthis paragraph shall not apply (i) to health club contracts that are payable\nonly on a monthly basis and for which the initiation fee is no more than $250 or\n(ii) if the number of the health club’s contracts in effect with a term\nthat exceeds 13 months is less than 10 percent of the total of its health club\ncontracts.\n\t\t\tThe number of applicable unexpired contracts shall be separately calculated\nfor each facility.\n\t\t\tA health club shall file a separate bond or letter of credit with respect to\neach separate facility, even though the separate facilities are owned or\noperated by the same health club.\n\t\t\tHowever, no health club shall be required to file with the Commissioner bonds\nor letters of credit in excess of $300,000. If the $300,000 limit is applicable,\nthen the bonds or letters of credit filed by the health club shall apply to all\nfacilities owned or operated by the same health club.\n\nB. A health club may sell health club contracts of up to 36 months’\nduration for a facility for which a health club has not filed a bond or letter\nof credit so long as the amount of payment actually charged, due or received\nunder the health club contracts each month by the health club or any holder\nthereunder does not exceed the monthly fee calculated pursuant to the definition\nthereof in § 59.1-296, with the exception that the payment actually charged\nmay include a maximum initiation fee of $125 for health club contracts of 13\nmonths or more in duration.\n\nHISTORY: 1984, c. 738; 1985, c. 585; 1990, cc. 392, 433; 1992, c. 117; 2004, c.\n988; 2010, c. 439; 2014, c. 459.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}