§484-8.5  Preliminary order of registration. 
(a)  The director shall enter a preliminary order of registration when:



(1)  The director receives a request therefor together
with a complete application for registration containing all information
required under this chapter, including, without limitation, all standardized
application forms prescribed by the director;



(2)  The director affirmatively determines, upon
inquiry and examination, that the applicable requirements of section 484-7 have
been met except for some particular requirement or requirements which is, or
are, at the time not fulfilled, but which reasonably may be expected to be
fulfilled; and



(3)  Preliminary subdivision approval has been granted
by the county in which the land is situated.



No preliminary order of registration shall be issued
unless the director is satisfied that the public offering statement adequately
discloses all matters required by section 484-6(a) and the rules adopted by the
director hereunder.



(b)  If the director determines upon inquiry
and examination that any of the requirements for issuance of a preliminary
order of registration have not been met, the director shall notify the
applicant that the application for a preliminary order of registration must be
corrected in the particulars specified within forty-five days.  If the
requirements are not met within the time allowed the director shall enter an
order rejecting the registration, which order shall include the findings of
fact upon which the order is based.  The order rejecting the registration shall
not become effective for twenty days during which time the applicant may
petition for reconsideration and shall be entitled to a hearing.



(c)  Upon issuance by the director of a
preliminary order of registration, the subdivider may solicit and accept
binding sales contracts (subject to any rights of rescission in favor of the
purchaser as set forth in this chapter) or nonbinding reservation agreements to
purchase the subdivided lands, notwithstanding any law requiring that final
subdivision approval be granted prior to the offer or sale of subdivided lands;
provided that all earnest money deposits, if any, received by the subdivider or
the subdivider's agents shall take the form of a check or other instrument
within the meaning of article 3 of chapter 490 and shall be payable to the
escrow agent, and that no cash shall be accepted by the subdivider or the
subdivider's agents.



(d)  All sums paid by purchasers and
prospective purchasers prior to the time the director issues a final order
registering the subdivided lands shall be placed in an escrow account under an
escrow agreement which provides that no disbursements shall be made from such
escrow account to or on behalf of the subdivider until the director enters a
final order registering the subdivided lands and the requirements of sections
484-8.7 and 484-8.6(b) and (c) have been met.  However, the subdivider or the
subdivider's agents may hold, until the expiration of the seven-day
cancellation period provided by section 484-7(6) or any longer purchaser
cancellation period (not exceeding sixty days) provided in the sales contract,
any instrument made by a purchaser:



(1)  For which subsequent holders may not claim
holder-in-due-course status within the meaning of article 3 of chapter 490; or



(2)  Where the payee is the escrow agent.



(e)  Rights under contracts for the sale of
subdivided lands, although binding on the purchasers, may not be enforced
against the purchasers so as to require the purchasers to close until:



(1)  A final order of registration is entered by the
director; and



(2)  The purchasers have had a full opportunity to
obtain a refund of any sums paid and a release from the purchasers' obligations
under the purchasers' sales contracts in accordance with section 484-8.7 or
section 484-8.6(b) or (c). [L 1983, c 175, pt of §8; am L 1992, c 132, §8]