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or Qualified Entity in that classification. A property may not be
transferred under the ROFR process for less than the Minimum Purchase
Price, but if the sequential negotiation created by statute yields
a higher price, the higher price is permitted.
(f) Satisfaction of ROFR.
(1) A Development Owner that has posted a Property
under the ROFR process is deemed to have satisfied the ROFR requirements
in the following circumstances:
(A) The Development Owner does not receive any bona
fide offers at or above the posted ROFR offer price (or, in the case
of a posted minimum purchase price, at the price yielded by the sequential
negotiation) from a Qualified Nonprofit Organization or Qualified
Entity during the required ROFR posting period;
(B) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), the Development Owner
accepts the offer, the Qualified Nonprofit Organization or Qualified
Entity fails to close the purchase, the failure is determined to not
be the fault of the Development Owner, and the Development Owner received
no other bona fide offers from a Qualified Nonprofit Organization
or Qualified Entity during the required ROFR posting period;
(C) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), the Qualified Nonprofit
Organization or Qualified Entity is not approved by the Department
during the ownership transfer review due to issues identified during
the Previous Participation Review process pursuant to Chapter 1, Subchapter
C of this title (relating to Previous Participation and Executive
Award Review and Advisory Committee), and the Development Owner received
no other bona fide offers at or above the posted ROFR offer price
(or, in the case of a posted minimum purchase price, at the price
yielded by the sequential negotiation) from a Qualified Nonprofit
Organization or Qualified Entity during the required ROFR posting
period; or
(D) An offer from a Qualified Nonprofit Organization
or Qualified Entity is received at a price below the posted ROFR offer
price, and the Development Owner received no other bona fide offers
from a Qualified Nonprofit Organization or Qualified Entity during
the required ROFR posting period at or above the posted ROFR offer
price; or
(2) A Development Owner with a LURA that identifies
a specific Qualified Nonprofit Organization or Qualified Entity to
be the beneficiary of the ROFR will satisfy the ROFR if:
(A) The identified beneficiary is in existence and
conducting business;
(B) The Development Owner offers the Development to
the identified beneficiary pursuant to the terms of the ROFR;
(C) If the ROFR includes a priority for a certain type
of Qualified Entity (such as a CHDO) to have the first opportunity
make an offer to acquire the Development, the identified beneficiary
meets such classification; and
(D) The identified entity declines to purchase the
Development in writing, and such evidence is submitted to and approved
by the Department.
(g) Non-Satisfaction of ROFR. A Development Owner that
has posted a Property under the ROFR process does not satisfy the
ROFR requirements in the following circumstances:
(1) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), and the Development
Owner does not accept the offer;
(2) The LURA identifies a specific Qualified Nonprofit
Organization or Qualified Entity to be the beneficiary of the ROFR,
and such entity no longer exists or is no longer conducting business
and the Development Owner received other bona fide offers at or above
the posted ROFR offer price (or, in the case of a posted minimum purchase
price, at the price yielded by the sequential negotiation) from a
Qualified Nonprofit Organization or Qualified Entity during the ROFR
posting period and fails to accept any of such other offers;
(3) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), the Development Owner
accepts the offer, the Qualified Nonprofit Organization or Qualified
Entity fails to close the purchase, the failure is determined to not
be the fault of the Development Owner, the Development Owner received
other bona fide offers from a Qualified Nonprofit Organization or
Qualified Entity during the ROFR posting period and then fails to
accept any of such other offers;
(4) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), the Development Owner
accepts the offer, the Qualified Nonprofit Organization or Qualified
Entity fails to close the purchase, and such failure is determined
to be the fault of the Development Owner;
(5) A bona fide offer from a Qualified Nonprofit Organization
or Qualified Entity is received at or above the posted ROFR offer
price (or, in the case of a posted minimum purchase price, at the
price yielded by the sequential negotiation), the Qualified Nonprofit
Organization or Qualified Entity is not approved by the Department
during the ownership transfer review due to issues identified during
the Previous Participation Review process pursuant to Chapter 1, Subchapter
C of this title (relating to Previous Participation and Executive
Award Review and Advisory Committee), the Development Owner received
other bona fide offers from a Qualified Nonprofit Organization or
Qualified Entity during the ROFR posting period and fails to accept
any of such other offers; or
(6) An offer from a Qualified Nonprofit Organization
or Qualified Entity is received at a price below the posted ROFR offer
price, the Development Owner received other bona fide offers from
a Qualified Nonprofit Organization or Qualified Entity during the
ROFR posting period at or above the posted ROFR offer price (or, in
the case of a posted minimum purchase price, at the price yielded
by the sequential negotiation), and the Development Owner fails to
accept any of such offers.
(h) Activities Following ROFR.
(1) If a Development Owner satisfies the ROFR requirement
pursuant to subsection (f)(1) - (2) of this section, it may request
a Preliminary Qualified Contract (if such opportunity is available
under §10.408 of this Subchapter) or proceed with the sale to
an entity that is not a Qualified Nonprofit Organization or Qualified
Entity at or above the ROFR offer price (or, in the case of a posted
minimum purchase price, at the price yielded by the sequential negotiation).
(2) Following notice that the ROFR requirement has
been met, if the Development Owner does not post the Property for
Qualified Contract in accordance with §10.408 of this Subchapter
or sell the Property to an entity that is not a Qualified Nonprofit
Organization or Qualified Entity within 24 months of the Department's
written indication that the ROFR has been satisfied, the Development
Owner must follow the ROFR process for any subsequent transfer.
(3) If the Department determines that the ROFR requirement
has not been met during the ROFR posting period, the Owner may not
re-post under this provision at a ROFR offer price that is higher
than the originally posted ROFR offer price until 24 months has expired
from the Department's written indication that the ROFR has not been
satisfied. The Development Owner may market the Property for sale
and sell the Property to a Qualified Nonprofit Organization or Qualified
Entity during this 24 month period in accordance with subsection (a)(1)
of this section.
(i) Sale and closing.
(1) Prior to closing a sale of the Property, the Development
Owner must obtain Department approval of the transfer through the
ownership transfer process in accordance with §10.406 of this
Subchapter (relating to Ownership Transfers (§2306.6713)). The
request should include, among other required transfer documents outlined
in the Post Award Activities Manual, the final sales contract with
all amendments.
(2) If the closing price is materially less than the
ROFR offering price or the terms and conditions of the sale change
materially from what was submitted in the ROFR posting, in the Department's
sole determination, the Development Owner must go through the ROFR
process again with a revised ROFR offering price equal to the reduced
closing price or adjusted terms and conditions based upon the revised
terms, before disposing of the Property.
(j) Appeals. A Development Owner may appeal a staff
decision in accordance with §11.902 of this title (relating to
Appeals Process).
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