Ala. Admin. Code r. 790-X-4-.05

Current through Register Vol. 43, No. 1, October 31, 2024

Section 790-X-4-.05 - Public Offering Statement Requirements

(1) Effective October 1, 1985, it shall be required that any person selling or attempting to sell a timeshare interval in any timeshare plan located or registered in Alabama provide the prospective buyer with a public offering statement prior to the buyer's signing any sale documents or committing himself in any manner to purchase a timeshare interval. The public offering statement shall contain at least the following:

(a) A cover page stating:

1. The name and address of the timeshare project;

2. The name and address of the developer of the project;

3. The following in conspicuous type:

"THIS PUBLIC OFFERING STATEMENT CONTAINS IMPORTANT INFORMATION WHICH SHOULD BE CONSIDERED PRIOR TO ACQUIRING A TIMESHARE INTERVAL."

"THE STATEMENTS CONTAINED HEREIN ARE SUMMARY IN NATURE. A PROSPECTIVE PURCHASER SHOULD REFER TO ALL DOCUMENTS AND OTHER ITEMS REFERENCED IN THIS PUBLIC OFFERING STATEMENT FOR MORE DETAILED INFORMATION."

"ORAL REPRESENTATIONS SHOULD NOT BE RELIED ON AS CORRECT STATEMENTS. REFER TO THIS DOCUMENT FOR CORRECT REPRESENTATIONS."

(b) A separate table of contents;

(c) A detailed description of the timesharing plan being offered, including a description of the accommodations and amenities in existence and those which are planned as part of the future development of the project. The number of timeshare intervals being sold, the total number of units available, a description of the various types of units available, the date by which each unit shall be fully available for occupancy, and the date by which each amenity shall be fully available for use shall be included;

(d) The total financial obligation of a purchaser including the initial purchase price, any interest charges, any costs of completing or recording the transaction, and any additional charges for which the purchaser may be or become subject;

(e) A copy of the documents, including but not limited to a condominium declaration, which established the timesharing plan;

(f) A copy of any purchase contract, lease, and/or any other contract to be signed by the purchaser as part of, or as a result of, the purchase;

(g) The name and address of the entity managing the plan being offered and the manner, if any, by which the managing entity or the duties of the managing entity may be changed by the seller;

(h) A copy of the rules, regulations, conditions or limitations regarding the use of the accommodations or facilities by purchasers;

(i) Any restrictions or condition on the transfer of the timeshare interval by a purchaser;

(j) An explanation of the purchaser's right to cancel;

(k) A copy of all escrow agreements pertaining to the timesharing plan;

(l) A detailed description of the status of the title to the real property underlying the timesharing plan, including a statement as to the existence and place of recording of each deed to the real property held by the seller, and a description of any lien, defect, judgment or other encumbrance affecting title to the property and a statement as to the place, book and page of recording of any recorded mortgage, note, lien, or other encumbrance against the property;

(m) A description of the insurance coverage provided for the benefit of purchasers, including the policy number(s), the amount of any type of coverage, and the company or companies providing the coverage;

(n) If maintenance fees are to be charged, then a projected budget of all items subject to the maintenance assessment must be included along with a description of any and all contracts for any service included as a maintenance expense;

(o) If the timesharing plan is an ownership plan, then a description of how the purchaser's title will be made free of any blanket mortgage on the project property, as well as a description of any nondisturbance agreement pertaining to the purchaser's rights, and the place, book and page of recording of any mortgage release provision, executed partial release, or nondisturbance agreement pertaining to the property being offered the prospective purchaser, must be included;

(p) If the timesharing plan is a lease plan, the following in conspicuous type: "THE PLAN FOR WHICH YOU ARE PAYING DOES NOT GIVE YOU ANY OWNERSHIP OF YOUR UNIT. YOU ARE GETTING ONLY A LEASE AND THE RIGHT TO USE YOUR UNIT UNDER THAT LEASE. ANY FINANCIAL PROBLEMS OF THE PRESENT OWNER OR ANY PRIOR OWNER COULD RESULT IN YOU LOSING YOUR INTEREST ENTIRELY BY FORECLOSURE OF A MORTGAGE, ENFORCEMENT OF A LIEN, BANKRUPTCY, OR OTHER MEANS."

(2) Each timeshare seller shall obtain and keep in his business records a signed, dated receipt acknowledging delivery of the public offering statement to each prospective purchaser.

Ala. Admin. Code r. 790-X-4-.05

Filed August 15, 1985. Amended: Filed May 17, 1988.

Authors: Edward George, Charles R. Sowell, Pat Anderson. Statutory Authority:Code of Ala. 1975, §§ 34-27-8, 34-27-51.