Relating to liquor sales on credit by the holder of a distiller's and rectifier's permit to a wholesaler.

Contracts

Review and Amendment Required. The law relies on the "agreed terms of a contract."

• Distillers: You must ensure your Distribution Agreements explicitly define the payment due date. Vague "handshake" terms are unenforceable under this statute.
• Wholesalers: Negotiate a specific "Cure Period" into your contracts (e.g., "Delinquency occurs if unpaid 5 business days after receipt of written demand"). Without this, a Distiller could theoretically report you to the TABC immediately upon a missed deadline.

Hiring/Training

• Accounts Payable (Wholesalers): Staff must be trained to prioritize Distiller invoices based on contract dates, not standard "Net 30" internal policies. Late payment now carries license suspension risks.
• Accounts Receivable (Distillers): Staff must be trained on the "Demand for Payment" protocol. They cannot report a delinquency to TABC until a formal demand has been sent and ignored.

Reporting & Record-Keeping

New Audit Trail Required. To utilize this enforcement mechanism, Distillers must retain and be prepared to submit:

• 1. The Contract: Proof of the agreed due date.
• 2. The Invoice: Proof of the specific transaction.
• 3. Proof of Demand: A documented paper trail (certified mail or tracked email) proving a demand for payment was sent to the Wholesaler and subsequently ignored.

Fees & Costs

• No New Statutory Fees.
• Potential Costs: Legal fees for contract redrafting. Wholesalers face potential administrative fines or license suspension for non-compliance, based on the TABC's assessment of financial resources and violation history.