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Public offering statement; general provisions - 68 Pa. Cons. Stat. § 3402Legal Research Home > Pennsylvania Statutes Sponsored Links
§ 3402. Public offering statement; general provisions.
(a) General rule.--Except as provided in subsection (b), a
public offering statement must contain or fully and accurately
disclose:
(1) The name and principal address of the declarant and
of the condominium.
(2) A general description of the condominium, including
without limitation the types, number and declarant's schedule
of commencement and completion of construction of all
buildings, units and amenities. The public offering statement
shall also contain a narrative description of the type and
character of units offered, including a statement of the
degree of completion to be provided or undertaken by the
declarant of such units and the common elements necessary for
use and enjoyment of such units upon the conveyance by the
declarant of the units offered.
(3) The total number of additional units that may be
included in the condominium and the proportion of units the
declarant intends to rent or market in blocks of units to
investors.
(4) A brief narrative description of any options
reserved by a declarant to withdraw withdrawable real estate
under section 3206(1) (relating to contents of declaration;
flexible condominiums) and the expected effects that
withdrawal would have on the remaining portion of the
condominium.
(5) Copies and a brief narrative description of the
significant features of the declaration (other than the plats
and plans), and the bylaws, rules and regulations, the
agreement of sale, copies of any contracts and leases to be
signed by the purchasers prior to or at closing and a brief
narrative description of any other contracts or leases or
agreements of a material nature to the condominium that will
or may be subject to cancellation by the association under
section 3305 (relating to termination of contracts and leases
of declarant).
(6) Any current balance sheet and a projected budget for
the association, either within or as an exhibit to the public
offering statement, for one year after the date of the first
conveyance to a purchaser, and thereafter the current budget
of the association, a statement of who prepared the budget
and a statement of the budget's material assumptions,
including those concerning occupancy and inflation factors.
The budget must include, without limitation:
(i) A statement of the amount, or a statement that
there is no amount, included in the budget as a reserve
for repairs and replacement.
(ii) A statement containing a description of any
provisions made in the budget for reserves for
anticipated material capital expenditures or any other
reserves or, if no provision is made for reserves, a
statement to that effect.
(iii) The projected common expense assessment by
category of expenditures for the association.
(iv) The projected monthly common expense assessment
for each type of unit.
(7) Any:
(i) services not reflected in the budget that the
declarant provides, or expenses that he pays, and that he
expects may become at any subsequent time a common
expense of the association; and
(ii) personal property not owned by the association
but provided by the declarant and being used or to be
used in the operation and enjoyment of the common
elements which is or will be required in connection with
the operation and enjoyment of the common elements after
such personal property is no longer provided by the
declarant, and the projected common expense assessment
for the association and for each type of unit
attributable to each of those services or expenses and
purchase or rental of such personal property.
(8) Any initial or special fee due from the purchaser at
closing together with a description of the purpose and method
of calculating the fee.
(9) A description of any liens, defects or encumbrances
on or affecting the title to the condominium.
(10) A description of any financing for purchasers
offered or arranged by the declarant.
(11) The terms and significant limitations of any
warranties provided by the declarant including statutory
warranties and limitations on the enforcement thereof or on
damages.
(12) A statement in at least ten-point bold face type,
appearing on the first page of the public offering statement,
as follows:
(i) That within 15 days after receipt of a public
offering statement, or within seven days in the case of
the sale of a time-share estate, or an amendment to the
public offering statement that materially and adversely
affects the rights or obligations of the purchaser, the
purchaser, before conveyance, may cancel any contract for
purchase of a unit from a declarant.
(ii) That if a declarant fails to provide a public
offering statement, and any amendments thereto, to a
purchaser before conveying a unit, that purchaser may
recover from the declarant damages as provided in section
3406(c) (relating to purchaser's right to cancel).
(iii) A description of such damages.
(iv) That if a purchaser receives the public
offering statement more than 15 days before signing a
contract, he cannot cancel the contract, or more than
seven days in the case of the sale of a time-share
estate, except that, in accordance with subparagraph (i),
he shall have the right to cancel the contract before
conveyance within 15 days (seven days in the case of the
sale of a time-share estate) after receipt of any
amendment thereto that would have a material and adverse
effect on the rights or obligations of that purchaser.
(13) A statement of any judgments against the
association, the status of any pending suits to which the
association is a party and the status of any pending suits
material to the condominium of which a declarant has actual
knowledge.
(14) A statement that any deposit made in connection
with the purchase of a unit will be held in an escrow account
in accordance with the provisions of section 3408 (relating
to escrow of deposits) and will be returned to the purchaser
if the purchaser cancels the contract pursuant to section
3406.
(15) Any restraints on alienation of any portion of the
condominium.
(16) A description of all insurance coverage provided or
intended to be provided if such insurance is not then in
effect for the benefit of unit owners, including the types
and extent of coverage and the extent to which such coverage
includes or excludes improvements or betterments made to
units.
(17) Any current or expected fees or charges to be paid
by unit owners for the use of the common elements and other
facilities related to the condominium.
(18) The extent to which financial arrangements have
been provided for completion of all improvements labeled
"MUST BE BUILT" pursuant to section 3414 (relating to
declarant's obligation to complete and restore).
(19) All unusual and material circumstances, features
and characteristics of the condominium and the units.
(20) In the case of a leasehold condominium, at least
the following information:
(i) The name and address of each lessor and his
assignee, if any.
(ii) Any relationship between the declarant and any
lessor or assignee.
(iii) A description of the leased property.
(iv) The rent and any provision in the lease for
increases in the rent and any other charges or payments
required to be paid by the lessee under the lease.
(v) Whether the lessee has any right to terminate
the lease.
(vi) The information contained in the declaration as
required by section 3207(a) (relating to leasehold
condominiums).
(vii) The following notice in bold type: "Purchasers
should be aware that this is a leasehold condominium and
the purchaser's interest therein may be less valuable
than a fee interest, may depreciate over time and may be
of questionable marketability."
(21) A statement containing a declaration as to the
present condition of all structural components and major
utility installations in the subject property, including the
dates of construction, installation and major repairs if
known or ascertainable, and the expected useful life of each
item, together with the estimated cost (in current dollars)
of replacing each of the same.
(22) A description of how votes are allocated among the
units and a statement as to whether cumulative or class
voting is permitted and, if so, under what circumstances.
Such statement shall also explain the operation of such
cumulative or class voting.
(23) A description of any circumstances under which the
association is to become a master association or part of a
master association.
(24) A statement of all governmental approvals and
permits required for the use and occupancy of the condominium
indicating the name and expiration date of each such approval
or permit that has been obtained and, as to any governmental
approvals or permits that have not been obtained, a statement
indicating when each such permit or approval is expected to
be obtained and the person who shall bear the expense of
obtaining each such permit or approval.
(25) A statement as to whether there are any outstanding
and uncured notices of violations of governmental
requirements and, if there are any such notices of
violations, a description of the alleged violation and a
statement indicating when each violation is expected to be
cured and the person who shall bear the expense of curing
such violation.
(26) A statement as to whether the declarant has
knowledge of any one or more of the following:
(i) Hazardous conditions, including contamination
affecting the condominium site by hazardous substances,
hazardous wastes or the like, or the existence of
underground storage tanks for petroleum products or other
hazardous substances.
(ii) Any investigation conducted to determine the
presence of hazardous conditions on or affecting the
condominium site.
(iii) Any finding or action recommended to be taken
in the report of any such investigation or by any
governmental body, agency or authority in order to
correct any hazardous conditions, and any action taken
pursuant to those recommendations.
If the declarant has no knowledge of such matters, the
declarant shall make a statement to that effect. Declarant
shall also set forth the address and phone number of the
regional offices of the Department of Environmental Resources
and the United States Environmental Protection Agency where
information concerning environmental conditions affecting the
condominium site may be obtained.
(b) Exceptions.--If a condominium composed of not more than
12 units is not a flexible condominium and no power is reserved
to a declarant to make the condominium part of a larger
condominium, group of condominiums or other real estate, a
public offering statement may but need not include the
information otherwise required by subsection (a)(3), (4) and
(18) and the narrative descriptions of documents required by
subsection (a)(5).
(c) Amendment for material change in information.--A
declarant promptly shall amend the public offering statement to
report any material change in the information required by this
section.
(Dec. 18, 1992, P.L.1279, No.168, eff. 45 days)
References in Text. The Department of Environmental
Resources, referred to in subsec. (a), was abolished by Act 18
of 1995. Its functions were transferred to the Department of
Conservation and Natural Resources and the Department of
Environmental Protection.
Cross References. Section 3402 is referred to in sections
3102, 3320, 3401, 3403, 3404, 3407, 3410, 3414 of this title.
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Last modified: November 27, 2007 |