Resort Affiliation And Diners Association Agrmt

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RESORT AFFILIATION AND OWNERS ASSOCIATION AGREEMENT


This RESORT AFFILIATION AND OWNERS ASSOCIATION AGREEMENT ("Agreement") is made and entered into at Indianapolis, Indiana, by and between RESORT CONDOMINIUMS INTERNATIONAL, INC., an Indiana corporation having offices and its principal place of business at One RCI Plaza, 3502 Woodview Trace, Indianapolis, Indiana, U.S.A. ("RCI"), and ASCENSION RESORTS, LTD., a Texas limited partnership, having its principal place of business at 1221 Riverbend, Suite 120, Dallas, Texas 75247, ("Affiliate"), and HILL COUNTRY RESORT CONDOSHARE CLUB, an owners association comprised of the owners of Timeshare Interests at the Resort, having its principal place of business at 1221 Riverbend, Suite 120, Dallas, Texas 75247, ("Association").


RECITALS


A. RCI makes available the RCI Exchange Program to individuals who purchase or acquire Timeshare Interests in RCI Affiliated Resorts. B. Affiliate has developed Timeshare Interests at the resort project(s) described as follows: Name, location and street address of each Resort project affiliated hereby:
(use additional sheets if necessary)


HILL COUNTRY RESORT
Highway 306 Parkview
Canyon Lake, Texas 78133


C. Affiliate and Association have submitted to RCI an Application for Affiliation, a copy of which is incorporated by reference herein in its entirety, and desire the Resort to become an RCI Affiliated Resort, and for Affiliate and Association to offer to Purchasers the opportunity to become RCI Members and to be eligible to participate in the RCI Exchange Program. D. RCI desires the Resort to become an RCI Affiliated Resort and for Affiliate to perform services and duties associated with the RCI Exchange Program in accordance with the provisions of this Agreement until Affiliate transfers its management responsibilities to Association and thereafter, for Association to perform or provide for such services and duties.


NOW THEREFORE, in consideration of the mutual covenants and obligations contained in this Agreement, the parties hereby agree as follows:


ARTICLE 1 - DEFINITIONS


For the purposes of this Agreement, the terms listed below shall, unless the context otherwise requires, bear the following meanings:


1.1 APPLICATION FOR AFFILIATION: The Affiliate's and Association's Application for Resort Affiliation, including any attachments thereto, which is required to be submitted by Affiliate or Association to RCI in connection with this Agreement. 1.2 CONFIRMED EXCHANGE: RCI's written or oral notification to the Resort and RCI Member or Exchange Guest that an exchange has been confirmed and that accommodations at the Resort or another resort have been reserved for use by the RCI Member or Exchange Guest. 1.3 ENROLLMENT APPLICATION: The form of application from time to time prescribed by RCI for the enrollment of Purchasers in the RCI Exchange Program. 1.4 EXCHANGE GUEST(S): Person(s) who have received a Confirmed Exchange to the Resort from RCI. 1.5 MARKS: Those trademarks set forth below, or other trademarks as may be included and licensed by RCI to Affiliate and/or Association from time to time:


RCI
RESORT CONDOMINIUMS INTERNATIONAL
ENDLESS VACATION
SPACEBANK


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1.6 PRESALE: That status where the Resort or a Unit at the Resort is under construction, renovation or refurbishment and is considered by RCI to be not ready for occupancy by an Exchange Guest(s). 1.7 PROSPECTIVE PURCHASER: Prospective purchasers of a Timeshare Interest or other interest at the Resort or any other RCI Affiliated Resort. 1.8 PURCHASERS: Persons who purchase Timeshare Interests in the Resort, including persons who are already RCI Members at time of purchase. 1.9 RCI AFFILIATED RESORTS: Resorts subject to resort affiliation agreements with RCI, including those resorts described in Recital B. 1.10 RCI EXCHANGE PROGRAM: RCI's program of facilitating the exchange of Timeshare Interests. 1.11 RCI PROCEDURES MANUAL: Any manual(s) of policies and/or procedures for affiliates and Associations as published and amended by RCI from time to time. 1.12 RCI SUBSCRIBING MEMBERS OR RCI MEMBERS: Purchasers whose Enrollment Applications are accepted by RCI and who comply with the Terms and Conditions of RCI Membership. 1.13 RCI SUBSCRIPTION FEE: The annual fee from time to time payable by RCI Members in respect of RCI's directory, magazine(s) or other publications and such other benefits incident to the subscription. 1.14 RCI TERMS AND CONDITIONS: Those terms and conditions of RCI membership contained in RCI's Endless Vacation Special Resort Edition magazine as amended from time to time by RCI in its discretion. 1.15 RESELLERS: Any brokers, marketers, marketing companies or management companies engaged by Affiliate or Association. 1.16 RESORT: The resort project(s) or other lodging or vacation accommodation(s): (1) described in Recital B and (2) all subsequent buildings or phases of the resort project(s) or other lodging or vacation accommodation(s) which meet RCI standards. 1.17 TIMESHARE INTERESTS: Possessory, occupancy or usage rights in timeshare resorts or other lodging or vacation accommodation(s), whole-owner condominiums or similar vacation ownership plans. 1.18 UNIT: A unit of accommodation of moveable or immovable property designed for separate occupancy in connection with the use of a Timeshare Interest.


ARTICLE 2 - RCI'S DUTIES AND OBLIGATIONS


2.1 PROVIDE EXCHANGE PROGRAM. RCI shall make the RCI Exchange Program available to RCI Subscribing Members and perform its functions with respect to the RCI Exchange Program in accordance with its obligations under this Agreement, the RCI Terms and Conditions of Membership and the RCI Procedures Manual.


2.2 PROCESS ENROLLMENT APPLICATIONS. RCI shall process, promptly and fairly, Enrollment Applications and will notify Affiliate or Association if RCI rejects an Enrollment Application.


2.3 FEES. If an Enrollment Application is rejected by RCI or is cancelled by the Purchaser as a result of the Purchaser's cancellation or recision of a contract to purchase a Timeshare Interest, RCI will refund fees previously remitted to RCI which correspond to such rejected or cancelled Enrollment Application in accordance with the procedures set forth in the RCI Procedures Manual.


ARTICLE 3 - AFFILIATE'S AND ASSOCIATION'S OBLIGATIONS


3.1 ENROLLMENT APPLICATION AND FEES. During the term of this Agreement and any renewal terms, Affiliate and Association shall on a weekly basis and no later than thirty (30) days after a Purchaser's date of purchase:
3.1.1 submit to RCI a fully completed Enrollment Application for each
Purchaser;
3.1.2 pay to RCI in a form acceptable to RCI and without setoff or
deduction, a sum equal to the number of Purchasers since the
last payment was made multiplied by the applicable fee(s)
required for each Purchaser; and
3.1.3 submit a sales report in a form prescribed by RCI.


3.2 PROMOTION OF EXCHANGE PROGRAM. Affiliate and Association shall in a manner that complies with the terms of this Agreement and the RCI Procedures Manual, promote RCI and the RCI Exchange Program to Purchasers and Prospective Purchasers. Such efforts shall include but not be limited to:
3.2.1 distributing or arranging for the distribution of the Endless
Vacation Special Resort Edition magazine to all Purchasers at
the Resort;
3.2.2 making the Endless Vacation Special Resort Edition magazine
available to all Prospective Purchasers in the Resort; and
3.2.3 encouraging continued membership in the RCI Exchange Program.


3.3 MINIMUM PERFORMANCE REQUIREMENT. Affiliate and Association acknowledge that if Affiliate's or Association's annual Enrollment Applications do not exceed FIFTY (50), or, in the case of an Association, if the Association's enrolled membership is not more than ONE HUNDRED (100), it is not economically viable for RCI to maintain the Affiliation, and this Agreement is likewise terminable at the sole option and discretion of RCI upon sixty (60) days notice to Affiliate and Association.


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3 3.4 PHOTOGRAPH. Affiliate or Association agrees to provide to RCI at least two (2) photographs or representative images of the Resort for non-exclusive use by RCI, at its sole discretion, for the promotion of the RCI Exchange Program. Affiliate or Association represents and warrants to RCI that: (a) Affiliate or Association owns, has acquired or licensed the copyright rights in and to such photographs, and (b) Affiliate or Association has obtained, and has on file at its office, releases or consents from or for every person, entity or thing as may be required by law or otherwise for the reproduction of each such photograph as contemplated herein. Further, Affiliate and/or Association hereby releases, discharges and agrees to indemnify and hold RCI harmless from and against any and all liability, demand, claim, cost, expense, loss or damage (including attorneys' fees) caused by or arising from the reproduction and distribution of such photographs. This indemnification and hold harmless provision shall survive the termination of this Agreement for all applicable statutes of limitation.


3.5 RESERVE UNITS. Affiliate agrees to make available to the RCI Exchange Program NOT APPLICABLE reserve unit(s) at the Resort each week of the year until Affiliate ceases sales of the Timeshare Interests to be sold at the Resort. Each such reserve unit shall be a unit configuration acceptable to RCI. In the event that RCI sends to the Resort written notice that it does not intend to use a reserve unit, Affiliate may use that reserve unit as it sees fit. In the event that RCI sends to the Resort written notice that it does intend to use the reserve unit, or RCI sends no notice to the Resort, RCI may use that reserve unit as it sees fit.


3.6 MANAGEMENT DUTIES. Until Affiliate transfers its management responsibilities to Association, Affiliate agrees, and thereafter Association agrees:


3.6.1 on RCI's request, to promote new services and benefits provided
by RCI to RCI Members;
3.6.2 to perform services and other duties associated with the
operation of the RCI Exchange Program in accordance with the
RCI Procedures Manual and other materials furnished to it by RCI
from time to time;
3.6.3 to maintain high qualitative and managerial standards
throughout the Resort (including maintenance of an efficient and
effective reservations system) and in particular to
maintain high standards of hospitality, service, cleanliness,
maintenance and appearance and a comprehensive maintenance
program;
3.6.4 to operate its business in a commercially reasonable fashion
that will enable it to meet its obligations;
3.6.5 to honor all Confirmed Exchanges at the Resort;
3.6.6 to provide all RCI Members and Exchange Guests with the
services and facilities referred to in the Application for
Affiliation and this Agreement;
3.6.7 to provide all RCI Members and Exchange Guests with the same
rights and privileges at the same rates afforded generally to
Purchasers at the Resort;
3.6.8 to act in a reasonable and co-operative manner to satisfy any
complaints;
3.6.9 to the extent permissible by law, to submit to RCI upon RCI's
request, not to exceed once annually, a report containing the
name, current billing address and current ownership information
for each Purchaser at the Resort. This report shall be current
as of one month prior to the date such report is submitted to
RCI;
3.6.10 not to require Exchange Guests staying at the Resort to attend
a sales presentation;
3.6.11 to collect any bed tax, transient occupancy tax or other local
rate tax or charge on use or occupancy of the Resort's
accommodations from owners of the Timeshare Interests at the
Resort, unless the imposition of such tax is precluded by
law, in which case to collect the applicable taxes from Exchange
Guests;
3.6.12 to provide RCI with Certificates of Insurance reflecting: (1)
those property and casualty coverages in effect as described in
Section 5.3.3 and (2) naming RCI as an additional insured under
such general liability policy as required by Section 5.3.3; and
3.6.13 to inform RCI before the appointment or replacement of any
management and/or maintenance company relating to the Resort
(whose appointment shall not, for the avoidance of doubt, affect
the Affiliate's obligations of management and maintenance of the
Resort).


3.7 CHANGE IN INFORMATION. Affiliate and Association agree to immediately notify RCI of any change in any information set forth in the Application for Affiliation or of any other fact or circumstances affecting the operation of the RCI Exchange Program with respect to the Resort.


3.8 NON-INTERFERENCE. During the term of this Agreement and following its termination, neither Affiliate nor Association shall in any manner:
3.8.1 encourage any Purchaser or any other timeshare owner or RCI
Member, to modify, amend, rescind, contravene or cancel their
RCI membership;
3.8.2 encourage any owners association, club, developer or RCI
Affiliated Resort to modify, amend, rescind, contravene or
cancel its affiliation agreement with RCI; or


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3.8.3 interfere or facilitate interference in any respect with the
contractual relationship between RCI (including any RCI
subsidiary, parent, associated or affiliated company or other
entity in which RCI or its principal holds a controlling
ownership interest) and any party contracting with RCI.


3.9 NON-DISCLOSURE. During the term of this Agreement and after its termination, Affiliate and Association agree that neither shall use for its own benefit (other than as permitted under this Agreement) or disclose to any third party, directly or indirectly, any information with respect to: (a) the terms of this Agreement or this Agreement's prior drafts or documents used in this Agreement's negotiations, (b) any proposals produced by RCI and distributed to Affiliate or Association, (c) any RCI proprietary information (including but not limited to any trade secrets, any confidential business information not readily available to the general public, or any confidential information regarding the operation of the RCI Exchange Program) to which it may be privy, (d) RCI membership numbers or exchange activity of any RCI Member of Exchange Guest, or (e) the names, addresses or telephone numbers of Purchasers at the Resort or other RCI Members. However, disclosure of the terms of this Agreement may be permitted in the following limited circumstances: (i) where such disclosure is required by law, provided that Affiliate or Association give RCI at least twenty (20) days written notice prior to such disclosure, and (ii) where requested by Affiliate's or Association's fiduciaries or proposed lenders, only if: (1) Affiliate or Association secure, on behalf of RCI, the agreement in writing of the receiving party not to further disclose the confidential information, and (2) RCI gives written approval of such disclosure. Notwithstanding the above, Affiliate and Association agree that direct or indirect disclosure of any of the above information to any other exchange company, timeshare or vacation ownership developer or timeshare owners association is expressly prohibited by this Section under any circumstances.


3.10 DENIAL OF ACCESS.
3.10.1 If Affiliate or Association fails to honor a Confirmed Exchange
into the Resort or if an Exchange Guest is otherwise denied
access to a unit at the Resort for which that Exchange Guest has
a Confirmed Exchange, then Affiliate or Association, whichever
has failed to honor such Confirmed Exchange or denied such
access, shall immediately and at its own expense secure
alternative accommodations of similar size and quality for the
same time period for the Exchange Guest and shall reimburse RCI
for any costs incurred by RCI in connection with such failure to
honor the Confirmed Exchange or such denial of access.
3.10.2 Neither Affiliate, Association nor RCI shall have any
obligation to secure alternate accommodations for an Exchange
Guest arriving at the Resort during an interval other than that
for which the Exchange Guest has been confirmed by RCI.


3.11 PROTECTION OF RCI'S INTERESTS. Affiliate and Association agree that during the term of this Agreement and for a period of one (1) year after this Agreement is terminated for any reason, it will not, without RCI's prior written consent, hire, employ, engage or pay for services any person who was employed by RCI during the term of this Agreement; or directly or indirectly induce any such person to terminate or alter his/her relationship with RCI.


ARTICLE 4 -- RELATIONSHIP OF THE PARTIES


4.1 REPRESENTATION OF RELATIONSHIP. Affiliate and Association shall fully and accurately describe the ...