Current through Register Vol. 46, No. 52, December 24, 2024
(a)
The offering plan and the exhibits described below shall be submitted to the
New York Department of Law, Real Estate Finance Bureau, 28 Liberty Street, New
York, NY 10005.
(b) The exhibits
shall accompany the offering plan submitted to the Department of Law and shall
be subject to the requirements and sanctions of article 23-A of the General
Business Law. Whenever an exhibit document is marked "original" on the list set
forth in subdivision (c) of this section, it means that the document must be
duly executed, original document. Whenever a document is marked "copy" on the
list set forth in subdivision (c) of this section, it means that a true and
complete copy of the document must be included.
(c) The offering plan and exhibits submitted
pursuant to this Part must contain the following components and be in the
following format:
(1) A transmittal letter
addressed to the Department of Law that is signed and affirmed under penalty of
perjury by the attorney for the sponsor, containing the unqualified statements
required by section
21.4(a) of this
Part. The transmittal letter must expressly indicate any exhibit that is not
included and set forth the reasons for the omission. Exemptions requested
pursuant to section
21.1(i) of this
Part must be annexed to an be submitted with the transmittal letter. Pursuant
to section
21.3(q) of this
Part, the transmittal letter must note whether the offering plan contains any
description of or reference to a wraparound mortgage on the property.
(2) One paper copy of a typed or printed,
bound offering plan and one digital copy of the offering plan.
(3) One paper copy and one digital copy of
parts A (Certifications) and B (General) of the exhibits. The paper copy of the
exhibits shall be indexed with numbered tabs and secured in folders so that
documents can be removed easily. In addition, conformed copies of the
certifications must appear in the offering plan.
(i) Part A of the exhibits (Certifications)
shall consist of the following documents:
(a)
(A-1) index of documents in parts A and
B;
(b)
(A-2) certification by sponsor and sponsor's
principals (orig.);
(c)
(A-3) certification by sponsor's engineer or
architect (orig.);
(d)
(A-4) certification by expert as to adequacy
of projected income and expenses of the cooperative for the first year of
cooperative operation (orig.).
(ii) Part B of the exhibits (General) shall
consist of the following documents:
(a)
(B-1) projections from qualified experts or
the local suppliers of the consumption, and total cost for furnishing heat, hot
water, electricity and other utilities to the building including public areas.
If shareholders directly pay the cost of heating their own units, include
similar projections for heat, hot water and electricity for individual units;
(b)
(B-2) copy of title company report dated
within 30 days of submission;
(c)
(B-3)
copy of proposed management agreement;
(d)
(B-4)
copies of any contract which will be binding on the apartment corporation for
$2,500 or more per year;
(e)
(B-5)
copy of letter from an insurance company or its authorized agent, stating
proposed insurance coverage and amounts, the applicable tariff classifications,
and the annual premium or premiums.
(f)
(B-6)
copy of an opinion from a licensed insurance broker, insurance appraiser or
real estate appraiser concerning adequacy of coverage to avoid being a
co-insurer and/or the adequacy of coverage to replace the building.
(g)
(B-7) copy of section 352-a/352-b Designation
of Secretary of State as agent (applicable only to out-of-state issuers,
sponsors, principals and/or selling agents).
(h)
(B-8)
if the plan involves construction or rehabilitation and one is available, an
estimate of the assessed valuation after completion of construction or
rehabilitation from the local tax assessor. If applicable but not available, an
estimate of the assessed valuation after completion of construction or
rehabilitation from a real estate broker, appraiser, attorney or other
professional familiar with the tax assessment practices in the locality in
which the property is located;
(i)
(B-9)
for cooperatives located outside of New York, copy of statutes and regulations
governing cooperatives and evidence of compliance with that law;
(j)
(B-10) copy of the mortgage and note or bond
required by sponsor if sponsor is offering financing or required by a mortgage
lender procured by sponsor together with any other document which significantly
affects a purchaser's obligations for financing offered or procured by sponsor.
If the documents are not available at the time of submission to the Department
of Law, so indicate and forward when available;
(k)
(B-11)
copy of Certificate of Incorporation and receipt from Secretary of State for
the apartment corporation;
(l)
(B-12)
copy of specimen stock certificate. Include any restrictions on transferring
and any endorsements;
(m)
(B-13)
copy of any mortgage and note or bond that will be a lien on the property after
closing or which presently encumbers the property;
(n)
(B-14)
copy of any mortgage financing commitment letter;
(o)
(B-15)
copies of professional and commercial leases;
(p)
(B-16)
copy of contract of sale or exchange between the sponsor and the apartment
corporation that conforms to the contract described in the offering
plan;
(q)
(B-17) other material document(s), each of
which should be described in the transmittal letter,
e.g.,
copy of regulatory agreement with a government agency;
(r)
(B-18)
Copy of the escrow agreement between the sponsor and the attorney(s) acting as
escrow agent. If the model form is not used, so indicate. Copy of bank forms to
be used to open any escrow account;
(s) *(B-19) Copy of surety bonds or letter of
credit proposed to secure down payments and any underlying agreement or related
agreement, and any undertaking called for in the regulations or proposed to be
furnished.
(iii) One copy
of part C of the exhibits (Engineering). Part C of the exhibits shall consist
of the following documents:
(a)
(C-1) copy of approved building plans if
available or if required by General Business Law section 352-e e or if required
by local law. Any specifications required by government agencies having
jurisdiction and copies of all required construction permits from government
agencies having jurisdiction. Except for an offering plan governed by General
Business Law section 352-e e, if the approval of the building plans on the
construction permits are not available at the time of submission of the
offering plan to the Department of Law, so indicate and forward when
available;
(b)
(C-2) architect's or engineer's detailed
description of the physical aspects of the cooperative with the architect's or
engineer's stamp and original signature;
(c)
(C-3)
copy of temporary, partial or permanent certificate of occupancy to be in
effect after construction or rehabilitation, if available. If the certificate
of occupancy is not available at the time of submission of the offering plan to
the Department of Law, so indicate and forward to the Department of Law when
available.
(iv) One copy of part D of the exhibits
(fees, and other information) in a separate folder similarly secured and
indexed. Part D of the exhibits shall consist of the following documents:
(a)
(D-1)
personal or certified checks for filing fees under General Business Law
sections 352-e(7)(a) and 359-e(5) payable to the New York State Department of
Law placed within an envelope at the first tab with form of receipt issued by
the Department of Law. To expedite processing, the sponsor should submit two
checks, each in the amount of one half of the total fee due under General
Business Law section 352-e (7)(a) at the time of submission. Each check for
filing fees should be accompanied by a form of receipt issued by the Department
of Law. One of the two checks will be returned to the sponsor if the Department
of Law issues a deficiency letter;
(b)
(D-2)
signed M-10 form(s), broker-dealer statement, for the selling agents (Orig),
unless exempted by General Business Law section 359-e, and signed M-2 form(s),
salespersons' statements, for all individual employees who act as salespersons
(Orig), unless exempted by General Business Law section 359-e. Forms do not
have to be submitted if currently valid registration forms are on file with the
Department of Law from prior offerings (Orig) and a copy of the form is
submitted as Exhibit D-1;
(c)
(D-3)
signed M-10 form(s), registration for broker-dealer, for the sponsor signed by
all officers, directors, partners or principals. Forms do not have to be
submitted if currently valid registration forms are on file with the Department
of Law from prior public offerings (orig.);
(d)
(D-4)
signed RI-1 form(s), registrant information form(s) concerning prior
convictions, judgments, administrative actions, bankruptcy, employment and
business affiliations for all principals of the sponsor (orig.);
(e)
(D-5) proof of financial responsibility of
sponsor (sponsor's certified statement or affidavit of sponsor's net worth) and
sponsor's certification that its net worth together with the proceeds of firmly
committed construction financing, are sufficient to meet sponsor's unsecured
obligations under the plan to complete all work and meet sponsor's obligations
for unsold shares (orig.);
(f)
(D-6) an
affidavit from sponsor and principals of sponsor, as defined in subdivisions
(c) and (d) of section
21.1 of this Part, stating whether
sponsor and principals of sponsor have taken part in public offerings of
cooperative interests in realty including condominiums in or from New York
which were initially offered during the preceding five years. State the address
of the realty and approximate date of the closing for cooperatives and the
first closing for condominiums;
(g)
(D-7)
exemption application pursuant to General Business Law section 359-e;
(h)
(D-8) completed statistical information
card(s) available from the Department of Law.
(d) Upon
preliminary advice from the Department of Law that the proposed offering plan
may be filed, sponsor must submit:
(1) checks
(certified or uncertified) for the balance of the filing fees, if any, pursuant
to General Business Law section 352-e (7)(a) and by separate check any
additional filing fees pursuant to General Business Law section 359-e (5),
payable to "New York State Department of Law;"
(2) one paper copy of the typed or printed,
bound offering plan and one digital copy of the offering plan with the filing
date left blank (the filing date shall be inserted after receipt of the letter
from the Department of Law accepting the plan for filing; all offering plans
must be dated before being presented to offerees);
(3) a new attorney transmittal letter; see
section 21.4(a) of this
Part. The letter may indicate that exhibits have previously been supplied;
and
(4) if required by the
Department of Law:
(i) a new certification by
sponsor and sponsor's principals; see section
21.4(b) of this
Part;
(ii) a new certification by
sponsor's engineer or architect; see section
21.4(c) of this
Part; and
(iii) a new certification
by sponsor's expert on the adequacy of the budget; see section
21.4(d) of this
Part.
(e) The
plan is filed on the date indicated in the letter from the Department of Law
stating that the plan has been accepted for filing.
(f) The sponsor shall commence the offering
within a reasonable time after the filing and if applicable shall submit an
affidavit of service of the plan and notice on the commercial or professional
tenants within five days of such service.