(a) Disclosures. A Public Offering Statement shall disclose fully and accurately the characteristics of the conversion condominium development and the units therein and all unusual and material circumstances and features affecting the development. The Public Offering Statement shall not intentionally omit any material fact or contain any untrue statement of a material fact and shall contain the following:
(1) A statement indicating the names and addresses of:
A. The developer, and the legal and beneficial owner, if different, of the land and improvements, including all general partners, in the case of a partnership, or all directors and owners of ten percent or more of the beneficial interest in stock, in the case of a corporation; and
B. The mortgagees, principal sales and management agents, attorneys, accountants, architects, engineers and contractors.
(2) A description of all condominium property and improvements, including the following:
A. A general merit or description stating the total number of units, a description of the types of units, the price of each type of unit, and all appliances and personal property included with each unit;
B. A description of all of the common areas and facilities and the share of ownership of each unit in the common areas and facilities. Limited common areas and facilities, if any, and their ownership shall also be indicated.
C. A site plan showing the location and dimensions of the conversion condominium development and the land that occupies the development, together with all capital improvements thereof, the typical floor plan and typical individual unit plans, including dimensions;
D. A description of each of the capital improvements contemplated but not yet completed by the developer, including the type and quality of materials to be used, the estimated cost and the dates by which such capital improvements shall be completed;
E. A description of the nature and ownership of all improvements and sublots occupying the same zoning lot, but which are not part of the conversion condominium development, and the location, nature and ownership of the easements, streets, roads, driveways and parking facilities which are associated with the development;
F. A statement as to the maximum number of units the developer intends to retain ownership of or to transfer to persons who do not intend to reside in such units;
G. A statement disclosing whether or not any unit or common areas or facilities in the conversion condominium development may be used for commercial purposes, the nature and extent of such uses and the effect of such uses, if any, on the unit owners;
H. A description of the nature of any restraint on the free alienability or use of all or any part of the conversion condominium development, excluding residential zoning use. If there is a restriction upon the free sale, transfer, conveyance, encumbrance or leasing of a unit, the following statement shall be inserted in a type size and style equal to at least twenty point bold type:
THE SALE, LEASE OR TRANSFER OF UNITS (NUMBERS) ARE RESTRICTED OR CONTROLLED.
Immediately following this statement, there shall appear a reference to the documents and the articles, paragraphs and pages thereof where the restriction, limitation or control on the sale, lease or transfer of units is set forth or described in detail.
I. A description of all restrictions, notices, lis pendens and encumbrances of record, and a statement of any pending or threatened litigation concerning the conversion condominium development; and
J. A report by the developer stating the age, condition and the developer's opinion of the remaining useful life of structural elements and mechanical and supporting systems, together with the developer's estimate of repair and replacement costs projected for five years from the date of the filing of the declaration.
(3) Estimated financial statements, including the following:
A. A two-year estimated operating budget, revised and updated at least every six months, of annual expenditures necessary to operate and maintain the common areas and facilities of the conversion condominium development, specifically stating the assumptions and bases on which each item included in such budget was formulated. The developer may be held financially responsible for any intentional misrepresentation in such budget. The budget shall include at least the following costs, if applicable:
1. Operating costs.
Utilities
Heating fuels
Janitorial services
Trash and garbage disposal
Ground and building maintenance
Security
Maintenance and operation of recreational and other facilities
Building insurance
Elevator maintenance
Sidewalk and street maintenance
Other operating costs
2. Management costs.
Accounting and bookkeeping services
Legal services
Management fees
Other management costs
3. Reserve costs as certified by a certified public accounting firm.
Reserve for unexpected repair work
Reserve for replacement and upkeep of common areas and facilities
Other reserve funds
If no reserve is provided for one or more of the applicable reserve costs, the following statement shall be inserted in a type size and style equal to at least twenty point bold type:
THE DEVELOPER HAS NOT PROVIDED A RESERVE FOR CERTAIN POSSIBLE FUTURE COSTS OF THE CONDOMINIUM IN HIS BUDGET. ACCORDINGLY, IT MAY BE NECESSARY TO PROVIDE FOR A SPECIAL ASSESSMENT TO ALL CONDOMINIUM UNIT OWNERS TO PAY FOR SUCH COSTS SHOULD THEY OCCUR.
B. A two-year statement of the estimated common area and facility operating budget for each individual unit and a statement of all additional estimated monthly expenses, for the same period for each unit, to be itemized as utilities, parking, recreational facilities and other anticipated expenses for each unit;
C. A statement as to what financial arrangements, if any, the developer has made to cover the estimated common areas operating budget in the event an insufficient number of units is sold;
D. A statement of the current real estate taxes for each individual unit and the estimated changes in the tax assessment for each unit, assuming the taxes as reappraised are based on the sales price of the real estate; and
E. A statement that:
1. Any deposit made in connection with the purchase or reservation of a unit shall be placed in an escrow account or held in trust until delivered to the developer at closing, delivered to the developer because of the purchaser's default under a contract to purchase the unit, or refunded to the purchaser;
2. A deposit of two thousand dollars ($2,000) or more, held for more than ninety days, shall bear interest at the rate of ten percent per year for any period exceeding ninety days; and
3. Such escrow funds shall not be subject to attachment by the creditors of either the purchaser or the developer.
(4) A description of warranties, including a two-year warranty by the developer covering the full cost of labor and materials for any repair or replacement of the common areas and facilities, and a one-year warranty covering the full cost of labor and materials for any repair or replacement of structural, mechanical or other elements pertaining to each unit, excluding costs necessitated by acts of God. The warranties specified in this section shall commence on the date of the filing of the deed of the first condominium ownership interest transfer in the conversion condominium development to a purchaser in good faith or value. In the case of an appliance furnished by the developer as part of the unit, the valid assignment by the developer of the express or implied warranty of the manufacturer of the appliance shall satisfy the developer's warranty obligation.
All warranties owned by the developer that exceed time periods specified in this section, with respect to any part of the units or common areas and facilities, shall be assigned to the purchaser.
(5) Copies of sales documents and literature pertaining to the condominium, including, but not limited to:
A. The sales brochures and purchase contracts to be used by the developer; and
B. The declaration and the bylaws of the condominium association.
(6) Descriptions of the following documents:
A. Any lease of real or personal property in the conversion condominium development other than a residential lease expiring later than two years after the filing of the Public Offering Statement with the City;
B. Any employment contract, insurance policy or other contract affecting the use, maintenance or access of or to all or part of the development, expiring later than two years after the filing of the Public Offering Statement with the City;
C. Any insurance policy applicable to the development, including the coverage and amount of such policy; and
D. Any management agreement, including the name of the management agent; services to be performed; term; charges; circumstances, if any, under which the charges may be increased; conditions, if any, under which the agreement may be cancelled or terminated; and a statement of the relationship between the developer and the management
firm, if any. The term of such management agreement shall be governed by Ohio R.C. 5311.25(D).
(7) A statement as to recreational facilities, including whether or not, and under what circumstances, the unit owners are required to be members of, support, or participate financially, other than as a part of their common expenses, in recreational facilities such as, but not limited to, health clubs, exercise rooms, tennis courts, swimming pools, party rooms and golf putting greens. If any recreational facility is not part of the common areas, charges for its use shall not exceed charges customarily made for the use of similar facilities in the City or in surrounding communities, and the statement shall so specify. In addition, if any recreational facility is not part of the common areas, the following warning shall be inserted in a type size and style equal to at least twenty point bold type:
THE (HERE NAMED FACILITIES) ARE NOT INCLUDED IN THE COMMON FACILITIES. THESE FACILITIES ARE AVAILABLE TO UNIT OWNERS FOR (HERE DESCRIBED MONTHLY CHARGE AND INVITATION FEE). UNIT OWNERS ARE NOT (AS APPLICABLE) REQUIRED TO PARTICIPATE FINANCIALLY.
(8) A statement as to parking facilities, including a description of the location, ownership and availability to unit owners and to the general public of parking associated with the condominium. If all such parking facilities are not part of the common areas or divided as individual parking spaces among, and designated as being part of, the units, the parking facilities must be legally dedicated to the exclusive use of the conversion condominium development and charges for the use of the parking facilities shall not exceed charges customarily made for the use of similar facilities in the City or surrounding communities, and the statement shall so specify. Further, the following statement shall be inserted in a type size and style equal to at least twenty point bold type:
PARKING FACILITIES ASSOCIATED WITH THIS BUILDING ARE NOT OWNED INDIVIDUALLY OR IN COMMON BY THE UNIT OWNERS.
(9) A statement conspicuously displayed on the first page of each copy of the Public Offering Statement in a type size and style equal to at least twenty point bold type and reading as follows:
WARNING: ORAL REPRESENTATIONS CANNOT BE RELIED UPON AS CORRECTLY STATING THE REPRESENTATIONS OF THE DEVELOPER AND ARE NOT BINDING ON THE DEVELOPER. REFER TO THIS PUBLIC OFFERING STATEMENT FOR CORRECT REPRESENTATIONS.
(10) The signature of the executive officer of the developer to a statement affirming under oath that the Public Offering Statement, including supplements, modifications and amendments thereto, is true, full, complete and correct as he or she truly believes.
(b) Amendments. The developer shall amend the Public Offering Statement from time to time when any material change occurs in matter contained therein. Amendments shall be made as soon as practicable after such material change occurs or as soon as the developer has reason to know of such material change. A Public Offering Statement is not current unless all amendments are incorporated therein.
(c) Promotional Uses. The Public Offering Statement shall not be distributed or used for any promotional purpose before its filing with the City. After such filing, the Public Offering Statement shall be used only in its entirety for promotional purposes, with the exception of sales brochures contained therein.
(Ord. 79-82. Passed 12-11-79.)