Section 38: Public offering statements; furnishing to purchaser; contents
Section 38. (a) A public offering statement shall be written in clear and concise language and shall contain or fully and accurately disclose:
(1) the name and principal address of the developer and the location of the time-share property;
(2) a general description of the time-share property and the time-share units, including without limitation the number of units in the time-share property and in any project of which said time-share property is a part, and the schedule of commencement and completion of all improvements, and a copy of the current price list;
(3) as to all units owned or offered by the developer in the same project:
(i) the types and number of units;
(ii) identification of units that are time-share units;
(iii) the types and durations of the time-shares;
(iv) the maximum number of units that may become part of the time-share property; and
(v) a statement of the maximum number of time-shares that may be created or that there is no maximum;
(4) copies of and a brief narrative description of the significant features of the time-share instrument and any documents referred to therein, other than any plats and plans, copies of any contracts or leases to be signed by purchasers at closing, and a brief narrative description of any contracts or leases subject to cancellation by the time-share owners under section twenty-three;
(5) the identity of the managing entity and the manner, if any, whereby the developer or the owners of the time-share units may change the managing entity or its control;
(6) a current balance sheet and a projected budget for the association, if there is an association, either within or as an exhibit to the public offering statement, for one year after the date of the first transfer to a purchaser, and thereafter the current budget, a statement of who prepared the budget, and a statement of the budgetary assumptions concerning occupancy and inflation factors. The budget shall 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 of any other reserves;
(iii) the projected time-share expense liability by category of expenditures for the time-share units; and
(iv) the projected time-share expense liability for each time-share;
(7) a description of (i) the nature and purposes of all charges, dues, maintenance fees, and other expenses that may be assessed, (ii) the current amounts assessed, (iii) the method and formula for changes, and (iv) the method and formula for allocating said expenses between the time-share owners and the developer or managing entity or any affiliate of either of them and the method and formula for allocating said expenses between time-share property and the person who owns or controls any property in the project which is not a time-share unit or used solely as an appurtenance thereto;
(8) any services which the developer provides or expenses he pays and which he expects may become at any subsequent time a time-share expense of the time-shares, and the projected time-share expense liability attributable to each of said services or expenses for each time-share;
(9) any initial or special fee due from the purchaser at closing, together with a description of the purpose of the fee and the method of its calculation;
(10) a statement describing the existence of and the effect on the time-share owners of liens, defects, or encumbrances on or affecting the title to the time-share units;
(11) a statement as to whether or not title insurance is available, the charge for title insurance, if available and a copy of a specimen title insurance policy, if available;
(12) a description of any financing offered by the developer;
(13) the terms and significant limitations of any warranties provided by the developer, including statutory warranties and limitations on the enforcement thereof or on damages;
(14) a statement that:
(i) within three business days after the date of receipt of a public offering statement, a purchaser may cancel any contract for purchase of a time-share from a developer;
(ii) if a developer fails to provide a public offering statement to a purchaser at least five business days before the delivery of a deed, notice of time-share lease or time-share license, whichever is applicable, the purchaser is entitled, in addition to any other remedy, to recover from the developer an amount equal to ten per cent of the sales price of the time-share;
(iii) if a purchaser receives the public offering statement more than three business days before the date of signing a contract, he cannot cancel the contract for failure timely to receive the public offering statement;
(iv) the creation, management and sale of time-share units and the contents of this public offering statement are regulated by this chapter and a violation of the provisions of this chapter shall give a purchaser a right of action as provided in section forty-nine. Said statement shall be printed in bold face type; and
(v) a time-share deed or notice of a time-share lease or time-share license shall be recorded in the registry of deeds or land registration office for the district in which the time-share property is located in order to protect the purchaser.
(15) a statement of any unsatisfied judgments against the developer or the managing entity, the status of any pending actions involving the sale or management of real estate to which the developer or an affiliate of the developer or the managing entity or an affiliate of the managing entity is a defending party, and the status of any pending actions of which the developer has actual knowledge, of significance to the time-share units;
(16) a statement that any deposit made in connection with the purchase of a time-share shall be held in an escrow account until expiration of the time for rescission or cancellation or any later time specified in the contract to purchase the time-share, and shall be returned to the purchaser if the purchaser cancels the contract pursuant to section forty-one;
(17) any restraints on transfer of time-shares or portions thereof;
(18) a description of the insurance coverage provided for the benefit of time-share owners;
(19) any current or expected fees or charges to be paid by time-share owners for the use of any facilities related to the project;
(20) a reasonable description of the furnishings, equipment or appliances provided with each time-share unit or a statement that no furnishings, equipment or appliances shall be provided; and the charge, if any, therefor;
(21) a description of all real estate and facilities owned by the developer, other than time-share units, the rights of time-share owners, if any, to use and occupy said real estate or facilities and the charge if any, therefor;
(22) the extent to which financial arrangements have been provided for completion of all promised improvements pursuant to section fifty-one;
(23) the extent to which a time-share unit may become subject to a tax or other lien arising out of claims against other time-share owners of the same time-share unit;
(24) a description of the rights and remedies provided in the time-share instrument of a time-share owner who is prevented from enjoying exclusive occupancy of a time-share unit by others, or a statement that no such rights and remedies are provided in said instrument; and
(25) all unusual or material circumstances, features and characteristics of the project.
(26) a description of any contractual arrangement requiring a developer to offer its time-share purchasers affiliation with any specific exchange company and the duration of any such requirement.
(b) A developer shall promptly amend (i) the public offering statement to report any material or adverse change in the information required by subsection (a) and section thirty-nine and (ii) the public offering statement or any supplement thereto to report any material or adverse change known to him in the information required by sections fifty-three and fifty-four.