168 BAY 49 STREET

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imple, the Owner may mortgage such Unit and become individually liable for the payment of the principal and any finance charges or interest on such mortgage indebtedness. b. It is the opinion of HC Law & Associates P.C. (“Tax Counsel”) that a Unit Owner who uses his Unit as a personal residence, will, under present law, for Federal, New York State and New York City income tax purposes, be entitled to a deduction for mortgage interest and real estate taxes in the year paid in the case of cash basis taxpayers or accrued in the case of other taxpayers, subject to certain exceptions and limitations which are more particularly discussed in the Tax Counsel’s Tax Opinion. Purchasers who are individuals should note that mortgage interest is deductible generally only with respect to (a) secured debt used to acquire, construct or substantially improve a principal or second residence (or which constitutes a refinancing of such debt) (up to a total indebtedness of $750,000). Interes

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of a Residential Condominium Unit of 168 Bay 49 th Street Condominium may deduct from his federal income taxes all interest payme nts made on the mortgage indebtedness and real estate taxes in the year paid or accrued covering his Condominium Unit under Section 164 and163 of the Internal Revenue Code of 1986, respectively. Rev. Rul. 64- 31 1964-1 C.B.300. It is to be noted that for fe deral income tax purposes, should an owner not use his Condominium Unit as a personal residence, but rather as an investment, he may be subject to overall limitations on the deductibility of investment interest. The owner of a residential Unit who is a vet eran of the United States Armed Forces may be entitled to a veteran’s exemption covering part of the real estate taxes otherwise assessed against his Unit. N.Y. Real Property Tax Law Section 458. In December of 2017, the Tax Cuts and Jobs Act of 2017 was enacted into law. The new law capped the state and local income tax deduction for p

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................. 118 SECTION XXII OPINION OF COUNSEL..................................................................... 123 SECTION XXIII(A) WORKING CAPITAL FUND ..................................................... 133 SECTION XXIII(B) RESERVE FUND .......................................................................... 135 SECTION XXIV MANAGEMENT AGREEMENT, CONTRACTS AND LEASES .... 136 SECTION XXV IDENTITY OF PARTIES ................................................................ 138 SECTION XXVI REPORTS TO UNIT OWNERS ANDDOCUMENTS ON FILE ... 140 SECTION XXVII GENERAL ......................................................................................... 141 SECTION XXVIII SPONSOR’S STATEMENT OF BUILDING CONDITION ....... 143 Part II ................................................................................................................................. 144 SECTION XXIX DESCRIPTION OF PROPERTY AND SPECIFICATIONS ......... 145 SECTI

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mprovements to the Common Elements, or (ii) assess any Common Charge for the creation of, addition to or replacement of all or part of a reserve, a working capital, contingency or surplus fund, or (iii) borrow money on behalf of the Condominium (except where necessary to perform work required by law and existing reserves are insufficient to pay for same), or (iv) increase or decrease the number of, or change the kind of, employees initially employed for the Condominium, or (v) enter into any service or maintenance contrac t for work or otherwise provide services in excess of those initially contracted for the Condominium, or (iv) exercise a right of first refusal to lease or purchase a Unit provided, however, that Sponsor’s written consent is not necessary to perform any fu nction or take any action described above, if and only if, the performance of such function or the carrying out of such an action is necessary (and no other alternative is available) to enable the Condomi

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aration affecti ng the rights of Sponsor shall take place without the written consent of the Sponsor. (See “Rights and Obligations of Sponsor”) 19. Working Capital and Reserve Fund . A Purchaser of a Unit shall be required to make a contribution at the Closing of Title to his Unit to the Working Capital Fund of the Condominium equal to one (1) month’s Common Charge. The Condominium budget set forth in Section VII, Schedule B includes as aline item a reserve fund of $1,700.00, to be collected out of the common charges paidby the Unit Owners at the time of the Closing of Title. The Reserve Fund, plus any budgeted yearly Reserve Fund may not be sufficient to provide for needed capital expenditures within five (5) years following the First Closing under the Plan. 13 NYCRR Section 20.3 (z)(6). If the Reserve Fund isn’t sufficient, the Condominium Board may impose assessments on Unit Owners. PROSPECTIVE PURCHASERS SHOULD THEREFORE CAREFULLLY CONSIDER SUCH RISK

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as liability insurance with respect to occurrences in or about the Unit. Each Purchaser of a Unit will be required to make a contribution to the Working Capital of the Condominium. Such contribution, to be made at Closing of the Unit, shall be in an amount equal to one (1) month’s Common Charge in effect at Closing for each Unit purchased. However, the Reserve Fund, plus any budgeted yearly Reserve Fund may not be sufficient to provide for needed capital expenditures within five (5) years following the First Closing under the Plan. PROSPECTIVE PURCHASERS SHOULD THEREFORE CAREFULLLY CONSIDER SUCH RISK IN THEIR DETERMINATION AS TO WHETHER TO PURCHASE A UNIT. (See the Section in Part I of the Plan entitled “Working Capital Fund and Reserve Fund”). Electricity meters will be installed for each Unit. A separate electricity meter is provided for the Building. A water meter is provided for the entire Buildin g. Each Unit Owner will receive his own utility bills for el

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State and New York City transfer taxes, and “Mansion Tax”, if applicable, and the amount equal to one (1) month’s common charge as contribution to Working Capital Fund. For a complete explanation of closing costs associated with the transfer of title to the Units, see the Section in Part I of the Offering Plan entitled “Unit Closing Costs and Adjustments.” The closing costs are in addition to the purchase price of each Unit. 4. The Common Interest of each Unit has been based upon expected value of each Unit taking fl oor space into consideration, subject to the location of such space and the additional factors of relative value to other space in the Condominium, the uniqueness of the Unit, the availability of Common Elements for exclusive or shared use, and the overall dimensions of the particular Unit pursuant to

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urance $3,000.00 Management Fee $5,000.00 Legal Fees and Audit Fees $1,700.00 Capital Reserve Fund $1,700.00 TOTAL PROJECTED EXPENSES $28,600.00

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Suite 6A, Flushing NY 11354, dated August 31, 2020. Unit Owners wil l share these costs based on their respective Common Interests. 10. Capital Reserve Fund ($1,700.00) This budgeted amount is intended to be for future major capital repairs or replacement items. This fund will be maintained and funded out of the payment of monthly common charges. However, there is no guarantee that this amount will cover the cost of repairing or replacing any or all capital items. The Unit Owners will share these costs based on their respective Common Interests. ****** The foregoing proje cted budget may be modified from time to time prior to the commencement of, or during, Condominium operation to add or increase one or more items of operating expense. If additional funds are required over and above these funds, it may be necessary to inc rease Common Charges or separately assess all Unit Owners. The Unit Owners will share these costs based on their respective Common Intere

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his Unit. Recording fees, title costs and taxes are based on rates in effect on the date of the Plan and are subject to change without notice. 1. Working Capital Fund. A Contribution to the Working Capital Fund of the Condominium in an am ount equal to one (1) month’s Common Charges then applicable to each Unit being purchased. 2. Title Insurance . A purchaser may obtain title insurance from any reputable New York title insurance company selected by Purchaser without any penalty. Sponsor make s no representation or warranty regarding the terms of any such insurance. (i) If Purchaser elects to obtain fee title insurance, Purchaser will pay the premium therefore, which will vary depending upon the amount requested. Title insurance should be ca lculated at a discounted rate (fee bulk rate) of the standard fee policy rates. (ii) If Purchaser elects to simultaneously obtain both fee title insurance and mortgage title insurance, the premium for the fee title insurance wi

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mprovements to the Common Elements, or (ii) assess any Common Charge for the creation of, addition to or replacement of all or part of a reserve, a working capital, contingen cy or surplus fund, or (iii) borrow money on behalf of the Condominium (except where necessary to perform work required by law and existing reserves are insufficient to pay for same), or (iv) increase or decrease the number of, or change the kind of, emplo yees initially employed for the Condominium, or (v) enter into any service or maintenance contract for work or otherwise provide services in excess of those initially contracted for the Condominium, or (iv) exercise a right of first refusal to lease or pur chase a Unit provided, however, that Sponsor’s written consent is not necessary to perform any function or take any action described above, if and only if, the performance of such function or the carrying out of such an action is necessary (and no other alternative is available) to enable the Condo

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mprovements to the Common Elements, or (ii) assess any Common Charge for the creation of, addition to or replacement of all or part of a reserve, a working capital, contingency or surplus fund, or (iii) borrow money on behalf of the Condominium (except where necessary to perform work required by law and existing reserves are insufficient to pay for same), or (iv) inc rease or decrease the number of, or change the kind of, employees initially employed for the Condominium, or (v) enter into any service or maintenance contract for work or otherwise provide services in excess of those initially contracted for the Condomini um, or (iv) exercise a right of first refusal to lease or purchase a Unit provided, however, that Sponsor’s written consent is not necessary to perform any function or take any action described above, if and only if, the performance of such function or the carrying out of such an action is necessary (and no other alternative is available) to enable the Condo

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ade, the Condominium will remain liable for Federal income tax on any taxable income it may have fr om other sources such as interest earned on any reserve fund (less expenses directly connected with the production of such income). b. If the Condominium does not qualify as a “homeowner association”, or if it does but chooses not to make the necessary election, it will be taxable as a corporation for Federal and New York State income tax purposes. c. The qualification of an organization as a “homeowners association” is determined annually at the close of each taxable year, and it is possible that if the Condominium does not qualify in one year, it may nevertheless qualify in one or more future years. d. There is a requirement to qualify under Section 528 that the squarefootage of the non -residential portions of the Condominium does not exceed 15% of the totalsquare footage. The Condominium will not be eligible to be treated as a tax exemptorganization under Section 528 of

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133 SECTION XXIII(A) WORKING CAPITAL FUND Working Capital Fund At closing of title, each Purchaser of a Unit shall be required to contribute a sum equal to one (1) month’s Common Charges to the Working Capital Fund of the Condominium (“Working Capital Funds”). The Working Capital Fund will be held for initial working capital, repairs, insurance premiums, and other operating expenses incurred by the Condominium prior to the time that sufficient monthly Common Charges have accrued to pay such expenses. Neither the Department of Law nor other g overnment agency has passed upon the adequacy of the working capital fund. 13 NYCRR Section 20.3(z)(2). No representation or warranty is made that the Working Capital Fund will be, or is intended to be, adequate to cover current or future expenses, includ ing repairs, replacements or major improvements, for the first or any subsequent year of Condominium operation. If additional funds are required over and above the Workin

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resents that it has the financial resources to satisfy its obligations under this Plan. While Sponsor is in control of the Condominium Board, the Working Capital Fund will be kept in a separate account and will not be used to reduce Common Charges. If any portion of the Working Capital Fund is used during this period to pay for items in the budget set forth in Schedule B, such amounts will be repaid out of Common Charges collected.

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135 SECTION XXIII(B) RESERVE FUND Reserve Fund Under the provisions of the By -laws, the Condominium Board has the right to establish a Reserve Fund for capital replacements or repairs. The Condominium budget set forth in Section VII, Schedule B includes as a line item a reserve fund of $1,700.00, to be collected out of the common charges paid by the Unit Owners. There is no separate reserve fund other than the one included in the budget. The reserve fund is to be used for future capital repairs, replacements or improvements. The Condominium Board will be able to utilize the funds in the Reserve Fund at any time and, accordingly, no representation or warranty can be made and no assurance can be given as to the exact amount of funds available at any specific time. However, in no event while the sponsor is in control of the Board of Managers, the reserve fund or working capital fund will be used to reduce projected common charges in the Plan or to pay any Co

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201 9.5 Purchaser shall make a contribution to the Working Capital Fund of the Condominium, payable to the Condominium Board, in an amount equal to one (1) month’ Common Charges then in effect for each Unit pursuant to the Condominium budget and in accordance with Schedule A in the Plan, as the same may be amended from time to time. 9.6 Purchaser shall make a contribution to the Reserve Fund of the Condominium, payable to the Condominium Board, in an amount equal to one (1) month’s Common Charges then in effect for each Unit pursuant to the Condominium budget and in accordance with Schedule A in the Plan, as the same may be amended from time to time. 9.7 Purchaser shall pay to the Condominium Board the Common Charges for the Unit for the first full month following the month in which title closes. In addition, if Purchaser is a foreign government, a resident representative of a foreign government or such other person or entity otherwise entitled to the immunities

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h amounts as the Condominium Board may deem proper for the operation and maintenance of the Property, including, without limitation, an amount for working capital of the Condominium, for a g eneral operating reserve, for a reserve fund for replacements, and to make up any deficit in the Common Expenses for any prior year. The Common Expenses may also include such amounts as may be required for the purchase or lease by the Condominium Board or its designee, corporate or otherwise, onbehalf of all Unit Owners, of any Unit whose Owner has elected to sell or lease such Unit or of any Unit which is to be sold at a foreclosure or other judicial sale. The Condominium Board shall advise all Unit Owners promptly, in writing, of the amount of Common Charges payable by each of them, respectively, as determined by the Condominium Board, as aforesaid, and shall furnish copies of each budget on which such Common Charges are based to all Unit Owners and to their mortgagees.

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d to indemnify and hold harmless the Condominium Board and the Unit Owners. 13 NYCRR Section 20.3(t)(2). 19. Sponsor will pay all Common Charges, special assessments and real estate taxes with respect to any Unsold Unit(s) owned by Sponsor in accordance with the provisions of the By-laws. Once title is passed to a Unit Owner, the Unit Owner shall be solely responsible for all common charges, special assessments and real estate taxes with respect to such Unit. Sponsor represents to have the financial resources to meet the aforesaid obligations with respect to Unsold Units and to fund same from income generated from projected sales, the rental or leasing of Unsold Units and Sponsor’s other financial resources. No bond or other securi ty will be posted by Sponsor with respect to this obligation. 20. Sponsor will initially procure on behalf of the Condominium Board the fire and casualty insurance pursuant to an agreed amount replacement value policy or in an amount suffi

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se may be made from the funds deposited in the capital and/or expense accounts of the Condominium, or, if such funds are insufficient, by levy of a Special Assessment. The Board may, in its discretion, finance the acquisition of a Unit provided tha t no such mortgage encumbers any portion of the Building other than the Unit being acquired. The Condominium Board shall have the right to release or waive such option without the prior approval or a vote of the Unit Owners. b. Any Unit Owner who wishes to enter into a lease for his Unit shall be required to provide the Condominium Board with a copy of the proposed lease prior to its execution. Any lease entered into must contain a provision that the Lessee is subject to the Declaration, By -Laws and Rules and Regulations of the Condominium. Failure to comply with the above shall be deemed an automatic violation of the By -Laws of the Condominium. A purchaser is free to make a gift of his or her Unit to anyone during his o

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unds are required over and above the Working Capital Fund to cover expenses of the Building, it may be necessary to increase Common Charges or make special assessments. Neither the Department of Law nor any other government agency has passed upon the adequacy of the Working Capital Fund. At the First Closing, Sponsor will apportion with the Condominium the following items as of midnight of the day preceding the First Closing: i. deposits with utility companies, if any, and fees forassignable permits and licenses, if any; ii. charges for electricity and other utilities forthe Common Elements; iii. payments under any service, maintenance and concessioncontracts; iv. cost of fuel on hand (plus sales tax), if any; v. any water charges and sewer rents, if any, payable as CommonCharges; vi. cost of building supplies on hand and equipment at Sponsor’scost (plus sales tax, if any); vii. premiums for transferable insurance policies, if any;

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nal funds are required over and above the Reserve Fund to cover expenses of the Condominium, it may be necessary to increase Common Charges or make special assessment. Neither the Department of Law nor other government agency has passed upon the adequacy of the Reserve Fund.

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and maintained a cash deposit account to be known as the "Operating Account" into which shall be deposited the operating portion of all monthly and special assessments as fixed and determined for all Units. Disbursements from said account shall be for the general needs of the operation including, but not limited to, wages, repairs betterments, maintenance and other operating expenses of the Common Elements and for the purchase, lease, saleor other expenses resulting from the purchase or lease of Units. Section 22. Other Accounts. The Board shall maintain any other accounts it shall deem necessary to carry out its purposes. ARTICLE VII SELLING AND LEASING OF UNITS Section 1. General. Each Unit Owner shall sell or lease his Unit in accordance with the provisions of the Plan, the Declaration and these By -laws. Any purported sale or lease consummated in default in the applicable terms hereof shall be voidable at the sole electi on of the Condominium Board, and,

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purtenant Interests. Section 6. Payment of Common Charges. In the event a Unit Owner leases his Unit and there ar e unpaid Common Charges and/or Special Assessments, such unpaid Common Charges and Special Assessments shall be repaid from the proceeds of the rent payments to such Unit Owner. Where the payment of such unpaid Common Charges and/or Special Assessments is made by the grantee or provided for out of the proceeds of the sale, a sale may take place notwithstanding the foregoing. Section 7. Waiver of Right of Partition. In the event a Unit shall be acquired by the Condominium Board or its designee, on behalf of all Unit Owners as tenants in common, all such Unit Owners shall be deemed to have waived all right of partition with respect to such Unit. Section 8. Power of Attorney. At the time of acquiring title to a Unit and as a condition thereof, the new Unit Owner shall duly exec ute, acknowledge and deliver to the representative of his title insurance c

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ted to mortgage, pledge, or hypothecate his Unit unless and until he shall have paid in full to the Condominium Board all unpaid Common Charges and Special Assessments theretofore assessed against such Unit and shall have satisfied all unpaid liens, except the liens of Permitted Mortgages against such Unit. b. No Unit Owner shall execute any mortgage or other document mortgaging, pledging, o r hypothecating title to his Unit without including therein its Appurtenant Interests, it being the intention to prevent any severance of such combined ownership. Any mortgage or other instrument purporting to affect one or more of such interests without including all such interests shall be deemed and taken to include the interest or interests so omitted, even though the latter shall not be expressly mentioned or described therein.

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Mortgagee, the Condominium Board shall promptly report to such Permitted Mortgagee any default by his mortgagor in the payment of Common Charges or Special Assessments or in the observance or performance of any of the provisions of the Condominium Documents as to which the Condominium Board has knowledge then exists. The Condominium Board shall, when giving notice to a Unit Owner of any such default, also send a copy of such notice to his Permitted Mortgagee, if so requ ested. However, the Condominium Board shall have no liability for any failure, through oversight or negligence, in notifying a Permitted Mortgagee of any default by his mortgagor under the Condominium Documents, provided that (i) the Condominium Board sha ll advise such Permitted Mortgagee of the default promptly after discovering such failure (which notice shall in all cases be given within sixty (60) days of such default) and (ii) if the Condominium Board shall foreclose a lien on such mortgagor’s Unit p

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xpenses on First Year Budget. The Water and Sewer is chang ed to $7,400.00, and the Legal Fee and Audit Fee is changed to $1,100.00 and the Capital Reserve Fund is changed to $2,900.00. Annexed hereto Exhibit B is a revised First Year Budget. 4. MORTGAGEE RIGHTS Modifying Section 6 “Rights of Mortgagees and Guarant ors” to Article VIII of By -Laws of the Declaration, to be 1) The mortgagee and guarantor of the mortgage on any unit in a condo project shall be given the right to timely written notice of: i) Any condemnation or casualty loss that affects either a material portion of the project or the unit securing its mortgage; ii) Any proposed action that requires the consent of a specified percentage of mortgagees ; iii) A lapse, cancellation, or material modification of any insurance policy maintained by the homeowners ’ association. 2) Amendments of a material adverse nature to mortgagees shall be agreed to by mortgagees that represent at least 51% of the votes of uni

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urance $3,000.00 Management Fee $5,000.00 Legal Fees and Audit Fees $1,100.00 Capital Reserve Fund $2,900.00 TOTAL PROJECTED EXPENSES $28,600.00