New York Codes, Rules and Regulations › Title 13 - DEPARTMENT OF LAW › Chapter II - SECURITIES TRANSACTIONS AND PERSONNEL › Subchapter B - REAL ESTATE SYNDICATES › Part 18 - OCCUPIED COOPERATIVES › Section 18.2 - Procedure for submission

Current through Register Vol. 46, No. 28, July 10, 2024
(a)
				  The proposed offering plan and the exhibits described below shall be submitted
				  to the New York State Department of Law, Real Estate Finance Bureau, 28 Liberty
				  Street, New York, NY 10005.
(b) The
				  exhibits shall accompany the proposed offering plan submitted to the Department
				  of Law and shall be subject to the sanctions of article 23-A of the G.B.L.
				  Whenever an exhibit document is marked "Original" ("Orig") on the list set
				  forth below, it means that at least one document must be a duly executed,
				  original document. Whenever a document is marked "copy" on the list set forth
				  below, it means that a true and complete copy of the document must be
				  included.
(c) The following are to
				  be included when submitting a proposed offering plan pursuant to this Part:
(1) A transmittal letter addressed to the
				  Department of Law that is signed and affirmed by the attorney who prepared the
				  plan, containing the statements required by section
				  18.4(a)  of this
				  Part, without qualification or alteration in substance. As specified in section
				  18.2(c)(4)  of
				  this Part, the transmittal letter must expressly indicate any exhibit that is
				  not included, (apart from those noted) and set forth the reasons for the
				  omission. Exemption applications submitted pursuant to section
				  18.1(k)  of this
				  Part must be annexed to and submitted with the transmittal letter. Omissions
				  and additions to the table of contents must be noted and explained. As
				  specified in section
				  18.3(m)(1)(ii)  of
				  this Part, note if any model form(s) for description of tenants' rights have
				  been used. Pursuant to section
				  18.3(s)  of this
				  Part, the transmittal letter must note whether the offering plan contains or
				  refers or to a short-term mortgage, negative amortization mortgage, wraparound
				  mortgage or other type of mortgage involving any unusual risks. Pursuant to
				  section 18.3(t)(12)  of
				  this Part, the transmittal letter must note financing offered to purchasers
				  which contains any unusual risks. Pursuant to section
				  18.3(bb)(5)(v)  of
				  this Part, the transmittal letter must note whether the offering plan contains
				  any description of or reference to leases with sponsor or affiliates of
				  sponsor.
(2) Staple or clip to the
				  transmittal letter a check (certified or uncertified) for one half of the
				  filing fee under G.B.L. section 352-e(7)(a) (a nonrefundable deposit) payable
				  to "New York State Department of Law". The filing fee(s) is (are) based on the
				  maximum total of the cash amount of the offering to non-tenant purchasers and
				  of the mortgages that will encumber the property after the closing.
(3) One paper copy of a typed or printed,
				  bound offering plan and one digital copy of the offering plan.
(4) One paper copy of all exhibits to the
				  offering plan and one digital copy of all exhibits to the offering plan. The
				  paper copy of the exhibits shall be in a binder from which documents can be
				  removed easily, and the binder must be indexed with tabs. The cover of the
				  binder must be labeled with the name and the address of the cooperative and the
				  name, address and telephone number of the attorney who prepared the plan. Both
				  the binder and the digital copy must contain an index of the documents. The
				  transmittal letter required by paragraph (l) of this subdivision must note the
				  omission of any exhibit, other than the exceptions stated below and the reason
				  for the omission. If exhibits A-4, B-3, B-4, B-8, B-9, B-10, B-11, B-16, B-17,
				  B-l8, B-19, B-20, B-21, B-22, B-23, B-24 are omitted solely because the exhibit
				  is not applicable to the offering, the omission need not be noted in the
				  transmittal letter.
(i) Part A of the exhibits
				  (Certifications) shall consist of the following documents. Photocopies or
				  conformed copies of the certifications shall appear in the offering plan.
(A-1) Certification by sponsor and sponsor's
				  principals signed by "sponsors" and "principals" as defined in section
				  18.1(c) and (d);
				  see section
				  18.4(b).
				  (Orig)
(A-2) Certification by
				  sponsor's engineer or architect concerning the description of the property and
				  building condition in Part II of the plan and at Exhibit C-1; see section
				  18.4(c).
				  (Orig)
(A-3) Certification by
				  expert as to adequacy of projected income and expenses for the first year of
				  cooperative operation; see section
				  18.4(d).
				  (Orig)
(ii) Part B of
				  the exhibits (General) shall consist of the following documents:
(B-1) Title company report, including a
				  report on housing or building code violations of record, dated or updated
				  within 90 days of submission. (Orig.)
(B-2) Proposed management agreement.
				  (Orig.)
(B-3) Copies of any
				  contract which:
(a) will be binding on the
				  apartment corporation for $2,500 or more per year;
(b) has a term in excess of two years;
				  or
(c)  is with sponsor, a business
				  affiliate of the sponsor or a principal of the sponsor.
(B-4) Copy of letter from an insurance
				  company or its authorized agent, stating proposed insurance coverage and
				  amounts, and the annual premium or premiums.
(B-5) Copy of an opinion from an independent,
				  licensed insurance broker, insurance appraiser or real estate appraiser
				  representing that the fire insurance coverage budgeted in the plan is adequate
				  (
a
) so that the insured shall not be a coinsurer if policy
				  contains a coinsurance provision, or (
b
) to cover replacement
				  cost if policy is for an agreed amount which waives coinsurance.
(B-6) Copy of § 352-a/§ 352-b
				  Designation of Secretary of State as agent (applicable only to out-of-state
				  issuers, sponsors, principals and/or selling agents).
(B-7) For cooperatives located outside of New
				  York, New Jersey, Florida, Pennsylvania and Connecticut, copy of statutes and
				  regulations concerning the registration and formation of cooperatives. All
				  cooperatives located outside of New York must include evidence of compliance
				  with local laws and regulations concerning registration and formation of
				  cooperatives.
(B-8) Copy of the
				  form of promissory note and mortgage on the proprietary lease, security
				  agreement, stock power, assignment of lease and recognition agreement required
				  by sponsor if the plan offers financing, together with any other document which
				  significantly affects a purchaser's obligations for financing offered by
				  sponsor.
(B-9) Copy of certificate
				  of incorporation and receipt from Secretary of State for the apartment
				  corporation, if available.
(B-10)
				  Copy of specimen stock certificate. Include any restrictions on transferring
				  and any other endorsements.
(B-11)
				  Copy of any mortgage and note or bond that will be a lien on the property after
				  closing or which presently encumbers the property.
(B-12) Copy of any mortgage financing
				  commitment letter and amendments or extensions of the commitment
				  letter.
(B-13) Copies of present
				  and proposed professional and commercial leases, and any concession
				  agreements.
(B-14) Copy of contract
				  of sale or exchange between the sponsor and the apartment corporation that
				  conforms to the contract described in the offering plan, and copy of proposed
				  deed to the apartment corporation.
(B-15) Rent roll certified by the sponsor,
				  managing agent or current owner, as of a date that is within 60 days prior to
				  submission, including the name of each tenant, apartment number, rent, term and
				  termination date of lease, and status under any rent regulatory laws.
(B-16) If the building receives tax abatement
				  or exemption benefits, copy of proof of the level and duration of benefits
				  described in the plan.
(B-17) Copy
				  of sponsor's or present owner's deed to the property, and copy of contract of
				  sale between owner and sponsor if sponsor is contract vendee.
(B-18) Copy of any other material
				  document(s), each of which should be described in the transmittal letter,
e.g.,
copy of regulatory agreement with a government
				  agency.
(B-19) 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.
(iii) Part C of the exhibits (Engineering)
				  shall consist of the following documents:
(C-1) Architect's or engineer's detailed
				  description of the property and building condition, with the architect's or
				  engineer's seal and original signature. The description must be dated within 90
				  days of submission to the Department of Law and conform to the requirements of
				  section 18.7  of this Part; see Exhibit
				  A-2.
(C-2) Copy of currently valid
				  temporary, partial or permanent certificate of occupancy. If a certificate of
				  occupancy is not available because the building was constructed before the
				  municipality began to issue certificates of occupancy, include a representation
				  from sponsor that the proposed use by the apartment corporation is identical to
				  the present use of the building.
(iv) Part D of the exhibits (Other
				  Information) shall consist of the following documents:
(D-1) 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 and a copy of the form is submitted as Exhibit
				  D-1.
(D-2) Signed M-10 form(s), for
				  the sponsoring entity, which shall include all officers, directors, partners or
				  principals who are "dealers" for purposes of G.B.L. section 359-e (Orig). Forms
				  do not have to be submitted if currently valid registration forms are on file
				  with the Department of Law from prior offerings and a representation to that
				  effect is stated in Exhibit D-2 (Orig).
(D-3) 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).
(D-4) Sponsor's
				  affidavit that sponsor's net worth is or will be sufficient to meet the
				  requirements of G.B.L. section 352-k and all of the unsecured obligations
				  sponsor assumes in the offering plan, including sponsor's obligations for
				  unsold shares (Orig).
(D-5) An
				  affidavit from sponsor and principals of sponsor, as defined in section
				  18.1(c) and (d) 
				  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 addresses of the realty and approximate date the offering plan
				  was filed, and the date of the closing for cooperatives or the date of first
				  closing for condominiums (Orig).
(D-6) Completed statistical information card
				  (available from the Department of Law).