Haw. Code R. § 16-106-4 - Registration required; developer, acquisition agent, sales agent, OPC, plan manager, exchange agent, sales agent employees, and independent contractors
(a) In addition to
the requirements set forth in section
514E-9, HRS,
a developer shall file the following with the director for the purpose of
registering the time share plan to be offered by the developer; provided that
an application submitted by a developer who has only an option to purchase
property to be offered under a time share plan shall not be acceptable; and
provided further that no application shall be deemed complete, nor shall the
same be accepted for registration, unless the prescribed information is
provided separately tabbed and numbered in the exact order as follows:
(1) An application for registration on a form
prescribed by the director;
(3) A current
financial statement not more than ninety days old at the time of submission of
the application, prepared in accordance with generally accepted accounting
principles and certified by the developer or a certified public accountant to
be true and correct in all respects and to fairly, completely, and accurately
represent the financial condition of the subject thereof as of the respective
date thereof; provided that in lieu of this financial statement, an audited
financial report may be submitted if it is the most current report of the
subject thereof and is not more than fifteen months old at the time of
submission of the application. Any false, misleading, or fraudulent financial
statement or report submitted by the developer shall be grounds for
cancellation, suspension, or revocation of a registration;
(4) For each unit to be registered under the
time share plan, a policy of title insurance, preliminary title report,
abstract of title, or certificate of title not more than sixty days old at the
time of submission of the application; provided that the policy of title
insurance, preliminary title report, abstract of title, or certificate of title
discloses the status of ownership of the unit and any and all liens and
encumbrances affecting the unit;
(5) Copies of all encumbrances against title
to each unit to be registered under the time share plan;
(6) If a corporation, a certified copy of the
articles of incorporation and bylaws thereof; if a partnership or joint
venture, a certified copy of the partnership registration and partnership
agreement;
(7) If a corporation,
partnership, or joint venture, a certificate of good standing issued by the
business registration division of the department not more than thirty days
before the date of submission of the application;
(8) A copy of an executed escrow agreement
meeting the requirements of chapter 514E, HRS, and as provided for in
subchapter 9;
(9) The name and
address of the person in the State authorized to receive service of process on
behalf of the developer; provided that written notification of any change of
this name or address shall be submitted to the director within twenty days of
any change;
(10) As required by
section 16-106-45, confirmation by the respective county that the time share
plan meets the geographic limitation requirements of section
514E-5,
HRS; provided that this confirmation of zoning shall be obtained from the
respective county not more than thirty days before the date of submission of
the application. The director shall prescribe a form to be completed by the
proper county authority evidencing this confirmation of zoning;
(11) A complete statement as to the manner in
which the time share plan complies with the requirements of section
514E-6,
HRS, governing time sharing in projects;
(12) A complete statement, including a
specific citation to the appropriate provision of section
514E-19,
HRS, of the method which the developer intends to use to protect purchasers
against underlying blanket liens; provided that the statement required under
this subsection shall not be deemed complete unless it includes both sufficient
detail to enable the director to determine the precise means by which the
requisite protection will be provided and copies of all pertinent agreements
and materials relevant to the proposed method of protection;
(13) As required by sections 16-106-25 and
16-106-26, if the time share plan is a "preexisting plan" as defined in this
chapter, evidence of the creation of the plan prior to June 29, 1980, and the
filing of the plan not later than December 31, 1980, and the number of
interests in the plan, if any, which were previously sold;
(14) If applicable, a copy of the declaration
of horizontal property regime for the subject property, as recorded and
subsequently amended, the bylaws of the association of apartment owners and
house rules of the association, and for any project which is not registered
with the state real estate commission under chapter 514A, HRS, a copy of the
project's condominium map;
(15) If
applicable, a copy of the declaration of covenants, conditions and
restrictions, as recorded and subsequently amended, which establishes the time
share plan;
(16) A copy of the
petition and charter of incorporation for the time share owners association
required by section
514E-29,
HRS, accepted by the department, as well as the bylaws of the association or
club;
(17) A completed specimen
copy of the notice of mutual right of cancellation of time share purchase
prescribed in section 16-106-20(c);
(18) A completed specimen copy of the
reservation agreement, contract of sale, or agreement of sale to be used in
connection with the sale of time share interests;
(19) If applicable, a completed specimen copy
of the deed, lease, or other instrument to be used to convey the property to
the purchaser;
(20) A specimen copy
of the purchaser's declaration of understanding of the plan and the contract,
if any;
(21) A copy of the executed
management agreement;
(22) A copy
of each executed sales agency or broker listing agreement; provided that the
commission schedule may be omitted from such agreement;
(23) A copy of the executed contract with an
exchange agent, if applicable;
(24)
As required by section 16-106-38, copies of any advertising or promotional
materials to be used in connection with the marketing of time share interests;
and
(25) The registration fee.
Pursuant to section 514E-10.5, HRS, the director may contract with private consultants in connection with the review of the filing required of time share developers under section 514E-10(a), HRS, and this section, the cost of the review to be borne by each developer; provided that this review shall not affect the consultant review authorized under section 514E-27, HRS, which the director may request for filings which encompass alternative arrangements for purchaser protection. The consultant fees are in addition to the registration fees specified in chapter 16-53, Hawaii Administrative Rules.
(b) An
acquisition agent, including the developer if it is also the acquisition agent,
conducting business in the State shall not solicit or encourage others to
attend a time share sales presentation or to contact a time share sales agent
or developer whether the time share plan includes any unit located in the State
or out-of-state, unless the acquisition agent submits an application for
registration to the director and the director accepts the application; provided
that the acquisition agent shall submit a separate application for each time
share plan with respect to which the acquisition agent is providing prospective
purchasers; and provided further that no application shall be deemed complete,
nor shall the same be accepted for registration, unless the prescribed
information is provided separately tabbed and numbered in the exact order as
follows:
(1) An application for registration
on a form prescribed by the director; provided that the application shall
include, but not be limited to, the following:
(A) The name of the time share plan with
respect to which the acquisition agent is providing prospective
purchasers;
(B) The principal
office address and telephone number of the acquisition agent; and
(C) If a corporation, the name, address, and
telephone number of its responsible managing employee;
(2) Satisfactory evidence that the
acquisition agent is bonded as required by section 16-106-40.1 to cover any
violation by the acquisition agent of any solicitation ordinances or other
regulations governing the use of the premise or premises in which the time
share plan is promoted; or evidence that the acquisition agent is currently
licensed pursuant to chapter 467, HRS, as a real estate salesperson or a real
estate broker;
(3) As required by
section 16-106-8(a), an alphabetized list of the names, addresses, and
telephone numbers of all employees and independent contractors who will be
engaged in contacting persons who may be interested in purchasing time share
interests in the time share plan, and, if any of these employees and
independent contractors is licensed pursuant to chapter 467, HRS, as a real
estate salesperson or a real estate broker, evidence that the employee or
independent contractor is so licensed;
(4) A copy of the executed agency agreement
applicable to the time share plan;
(5) The name and address of the person in the
State authorized to receive service of process on behalf of the acquisition
agent; provided that written notification of any change of this name or address
shall be submitted to the director within twenty days of any change;
(6) If a corporation, partnership, or joint
venture, a certificate of good standing issued by the business registration
division of the department not more than thirty days before the date of
submission of the application; and
(7) The registration fee.
An acquisition agent shall submit, for each employee or independent contractor who will be acting as an OPC by contacting persons who may be interested in purchasing interests in the time share plan, an application for registration on a form prescribed by the director and signed by the prospective employee or independent contractor and the registration fee.
(c) A sales
agent, including the developer if it is also the sales agent, conducting
business in the State shall not sell or offer to sell any interest or interests
in a time share plan for a developer whether the time share plan includes any
unit located in the State or out-of-state, unless the sales agent submits an
application for registration to the director and the director accepts the
application; provided that the sales agent shall submit a separate application
for each time share plan with respect to which the sales agent is offering or
selling time share interests; and provided further that no application shall be
deemed complete, nor shall the same be accepted for registration, unless the
prescribed information is provided separately tabbed and numbered in the exact
order as follows:
(1) An application for
registration on a form prescribed by the director; provided that the
application shall include, but not be limited to, the following:
(A) The name of the time share plan with
respect to which the sales agent is selling time share interests;
(B) The principal office address and
telephone number of the sales agent; and
(C) If a corporation, the name, address, and
telephone number of its responsible managing employee;
(2) Evidence that the sales agent is
currently licensed pursuant to chapter 467, HRS, as a real estate salesperson
or a real estate broker;
(3) As
required by section 16-106-8(a), an alphabetized list of the names, addresses,
and telephone numbers of all employees and independent contractors who will be
engaged in offering or selling interests in the time share plan, as well as
evidence that each of these individuals is currently licensed pursuant to
chapter 467, HRS, as a real estate salesperson or a real estate
broker;
(4) A copy of the executed
sales agency or brokerage agreement applicable to the time share plan; provided
that the commission schedule may be omitted from such agreement;
(5) A copy of the executed escrow agreement
meeting the requirements of chapter 514E, HRS, and as provided for in
subchapter 9;
(6) The name and
address of the person in the State authorized to receive service of process on
behalf of the sales agent; provided that written notification of any change of
this name or address shall be submitted to the director within twenty days of
any change;
(7) If a corporation,
partnership, or joint venture, a certificate of good standing issued by the
business registration division of the department not more than thirty days
before the date of submission of the application; and
(8) The registration fee.
A sales agent shall submit, for each employee or independent contractor who will be acting as an OPC by contacting persons who may be interested in purchasing interests in the time share plan, an application for registration on a form prescribed by the director and signed by the prospective employee or independent contractor and the registration fee.
A sales agent shall also submit, for each person on the list required by paragraph (3), an application for registration on a form prescribed by the director and signed by the real estate salesperson or broker.
(d) A plan manager,
including the developer if it is also the plan manager, shall not undertake the
duties, responsibilities, and obligations of managing a time share plan sold or
offered for sale in the State, whether the time share plan contains any unit
located in the State or out-of-state, unless the plan manager submits an
application for registration to the director and the director accepts the
application; provided that the plan manager shall submit a separate application
for each time share plan for which the plan manager is offering management
services; and provided further that no application shall be deemed complete,
nor shall the same be accepted for registration, unless the prescribed
information is provided separately tabbed and numbered in the exact order as
follows:
(1) An application for registration
on a form prescribed by the director; provided that the application shall
include, but not be limited to, the following:
(A) The name of the time share plan with
respect to which the plan manager is offering management services;
(B) The principal office address and
telephone number of the plan manager;
(C) If a corporation, the name, address, and
telephone number of its responsible managing employee; and
(D) The address at which all accounting
records, including but not limited to receipts, expenditures, and payment
vouchers, are maintained;
(2) A notarized statement, signed by the
developer and the plan manager, listing the plan manager's duties,
responsibilities, and obligations, which shall include, but not be limited to:
(A) Management and maintenance of each time
share unit;
(B) Assessment and
collection of maintenance fees;
(C)
Payment of real property taxes due on each time share unit as provided in
section
514E-3(a),
HRS;
(D) Supervising and monitoring
occupancy scheduling to assure owners or users of time share interests in each
time share unit that they will be provided with the promised use of the
unit;
(E) Providing time share
owners or users with a copy of the house rules of the building and supervising
the enforcement of these rules; and
(F) Keeping a detailed and accurate record,
in chronological order, of receipts and expenditures relating to the time share
plan with which the plan manager is affiliated;
(3) Satisfactory evidence that the plan
manager is bonded as required by section 16-106-40 to cover any default of the
plan manager or any of the employees of the plan manager of their duties and
responsibilities;
(4) A copy of the
executed management agreement for the time share plan;
(5) The name and address of the person in the
State authorized to receive service of process on behalf of the plan manager;
provided that written notification of any change of this name or address shall
be submitted to the director within twenty days of any change;
(6) If a corporation, partnership, or joint
venture, a certificate of good standing issued by the business registration
division of the department not more than thirty days before the date of
submission of the application; and
(7) The registration fee.
(e) An exchange agent, including
the developer if it is also an exchange agent, shall not operate an exchange
program for a time share plan:
(1) If the time
share plan includes any unit or units located in the State; or
(2) If any time share interest in the time
share plan is offered for sale or sold in the State (whether or not any time
share unit in the time share plan is located in the State);
unless the exchange agent registers under the chapter by filing with the director the information required in section 514E-10(e), HRS, and the registration fee.
(f) All applications for registration
required by this section shall be deemed accepted if the director has not acted
upon the applications within sixty days following receipt of the same; except
that this subsection shall not apply to any application which is incomplete and
does not contain all of the information required to be submitted to the
director under this section.
(g)
Any party required to register under this section shall notify the director in
writing of any material change in any information submitted to the director
within twenty days of any material change. Failure to notify the director of
any material change in the information submitted shall be grounds for
cancellation, suspension, or revocation of a registration.
(h) Any registration required by this section
shall be renewed not later than December 31 of each odd-numbered year. Failure
to complete all renewal requirements before December 31 of each odd-numbered
year shall result in forfeiture of the registration.
(i) The registration of a developer,
acquisition agent, sales agent, OPC, plan manager, exchange agent, or sales
agent employees or independent contractors, or both, may be placed on inactive
status. The information required by this section shall be updated before an
inactive registration will be activated.
(j) The registration fees required by this
section shall be in the form of a cashier's check or certified check made
payable to the "Department of Commerce and Consumer Affairs" in the amount
specified in chapter 16-53, Hawaii Administrative Rules.
(k) A cash bond form shall be prescribed by
the director.
(l) The registration
fee shall be paid upon submission of a registration application. Applications
shall not be accepted for department review unless accompanied by the requisite
fee.
(m) The format for
registration shall be prescribed by the director.
Notes
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